Page 19 - DMGT310_ENTREPRENEURSHIP_AND_SMALL_BUSINESS_MANAGEMENT

Entrepreneurship and Small Business Management

Notes Almost 2-3% of all innovations are due to the entrepreneurs. Without the boom of inventions
the world would have been a much dry place to live in. Inventions provide an easier way
of getting things done through better and standardized technology.
The individual gets maximum scope for growth and opportunity if he enters into
entrepreneurship. He not only earns, the right term would be he learns while he earns.
This is a real motivating factor for any entrepreneur as the knowledge and skills he
develops while owning his enterprise are his assets for life time which usually, lacks
when a person is under employment.
Although entrepreneurship is a challenging task but in most of the cases the rewards it
gives are much more than what one anticipates.
Entrepreneurship is one of the four mainstream economic factors, viz, land, labor, capital
and entrepreneurship. The word itself has been derived from the French word entrepreneur
in the 17th century, which means the person who undertakes the risk of new enterprise.
The persons would undertake the work of a contractor and bear the risk of profit or loss.

Adam Smith interpreted the work “enterpriser” in his famous book, Wealth of Nation in
1776 as an individual undertaking the formation of an organization for commercial purposes.
In his view, entrepreneurs reacted to economic change, thereby becoming the economic
agents who transformed demand into supply.

In the 19th century entrepreneurs were recognized as the captains of industry, the risk-
takers and decision-makers. They were the individuals who desired to acquire wealth and
who gathered and managed resources to create new enterprises. The implication of an
entrepreneur has changed from captains of industry to an elusive individual who reaped
profits at the expense of others.

Till the nineteenth century various concepts of entrepreneurship had emerged. Since then
in respect of managing the enterprise, the task of management has been recognized as an
important matter. For management, the responsibility of entrepreneurs has been delegated
to the managers.

Now the term entrepreneurship cannot be clearly defined or the entrepreneurs cannot be
clearly identified as a particular person. According to modern management experts,
entrepreneurship can be considered as a behaviour encompassing an individual’s pursuit
of opportunity irrespective of the resources controlled.

1.7 Keywords

Employment: Employment is a contract between two parties, one being the employer and the
other being the employee.
Entrepreneur: Someone who organizes a business venture and assumes the risk for it.
Entrepreneurship: Entrepreneurship is the act and art of being an entrepreneur or one who
undertakes innovations or introducing new things, finance and business acumen in an effort to
transform innovations into economic goods.

Factors of Production: Factors of production are the inputs to the production process.
Far-sightedness: Ability of planning prudently for the future.
Initiative: The power or opportunity to act or take charge before others do.
Innovator: An innovator in a general sense is a person or an organization who is one of the first
to introduce into reality something better than before.

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