Who is an Entrepreneur?
The word entrepreneur has its origin in the French language. An entrepreneur is one who organises, manages and assumes the risks of an enterprise. Enterprise is an undertaking, especially one which involves minimum four factors (i.e. land, labour, capital and entrepreneur) of production as indicated below.
An entrepreneur visualises a business, takes bold decisions to establish undertaking/enterprise; Coordinates the various factors of production and gives it a start. So it involves the willingness to take risk and innovation in undertaking an economic activity.
Entrepreneurs are the owners of the business/enterprise who invest/contribute the capital and bear the risk of uncertainties during business life.
The entrepreneur and enterprise are linked; the success of an enterprise depends on the entrepreneur. He is action oriented and highly motivated. He has the capability to evaluate business opportunities to collect the necessary inputs/resources to advantage of them and to initiate appropriate action to guarantee success.
Entrepreneur is the main factor of production. He is innovation oriented. He takes decisions regarding the product i.e., what to produce? How to produce? where to produce? and who are the consumers? or where is the market?
Or for whom to produce? It is the entrepreneur who initiates production process after mobilising all the factors of production. He is responsible for the success or failure of the business or for the profit or the loss.
According to Schumpeter, “Entrepreneurs are business leaders and not simple owners of capital. They are men of vision, drive and talent, who spot out opportunities and promptly grasp them for exploitation”.
In the words of Joseph. A. Schumpter “The entrepreneur in an advanced economy is an individual who introduces something new into the economy, a new method of production, a new product with which the consumers are not familiar, a new source of raw material or new market and the alike.”
Further according to him entrepreneur’s function is to “Reform or revolutionise the factors of production by exploiting an invention or more generally an untried technological possibility for producing a new commodity”.
French economist J.B. Say writes, “an entrepreneur is a person who shifts economic resources out of an area of lower productivity into an area of higher productivity and greater output/yield”.
Characteristics and Traits of an Entrepreneur:
The working profit of entrepreneurs is provided by following characteristics and traits.
Entrepreneurs are business leaders. They are persons with vision. They have driven and talent, they spot out the opportunities and promptly size them for exploiting to economic gains, perceptiveness gains.
Characteristics of an Entrepreneur:
An entrepreneur who has a high level of administrative capability, creativeness, self-confidence, organizational skill, desire for responsibility, high degree of commitment, flexibility, energetic and hardworking, farsightedness, resourcefulness and tactfulness stand much better chance of success in running the enterprise.
The personality characteristics of the entrepreneur are quite different from an ordinary person or human being. A few such characteristics are inborn and some are acquired. The traits can be further developed in an individual if they are present to some extent in him, with the help of training and development programmes generally organized under entrepreneurship development programmes.
An entrepreneur should possess the following characteristics:
1. Managerial competence or administrative ability.
3. Innovativeness and creativity.
4. High degree of commitment.
5. Tolerance for Ambiguity/Flexibility.
6. For sightedness or long and short term vision.
7. Knowledgeable or having sound technical knowledge.
8. Risk taker or willing to take moderate risk.
9. Optimistic and confident.
10. Desire for responsibility.
11. High level of energy.
12. Clarity of views.
13. Result oriented.
16. Problem solving attitude or decision maker.
17. Communication ability.
18. Secrecy of business.
19. Realistic approach.
Qualities of Entrepreneur:
For the success of an enterprise an entrepreneur should possess the following qualities:
(1) Risk taker.
(2) Self-confidence and positive self-concept.
(3) Qualities of leadership.
(4) High level of motivation.
(5) Problem solving capability.
(6) Ability to perceive opportunities and challenges.
(7) Independence of thoughts and actions.
(8) Realistic approach to planning.
(11) Managerial competence.
Functions of an Entrepreneur:
The entrepreneur performing the following functions:
(1) Perceives opportunities for profitable investment.
(2) Explores the possibilities and prospects of starting such a manufacturing enterprise.
(3) Obtains requisite technical know-how for the enterprise.
(4) Obtains required industrial license.
(5) Manages business and takes decisions.
(6) Should be dynamic.
(7) Profit oriented.
(11) Knowledgeable in Technology.
(12) Should have low need for Status and Power.
(13) Able to Assume Responsibility.
(15) Adaptive to suggestions.
(16) Decides the plant size.
(17) Selects plant site.
(18) Promotes new inventions.
(19) Coordinates different factors of production.
(20) Arranges input materials, machinery and finance required for the enterprise.
(21) Employees workers of requisite skills.
(22) Deals with Govt. departments such as sales tax, export-import, electricity, labour etc.
(23) Pays wages to workers and interest etc. to banks.
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