MPU 22012 - CHAPTER 1

CHAPTER 1

Introduction to
Entrepreneurship

CLO 1

Propose the value proposition of
entrepreneurial idea using Business

model Canvas

LEARNING OBJECTIVE

1.1Discuss the entrepreneurial concept and theories
1.2 Discuss the competencies of entrepreneurs
1.3 Discuss the importance of entrepreneurship to self,
family and society development
1.4 Discuss ethics, professionalism and social

CONCEPT OF ENTREPRENEUR
AND ENTREPRENEURSHIP

ENTREPRENEUR

➢Entrepreneur is an Economic Agent who plays a
vital role in the economic development of a
country.

➢An Entrepreneur is an individual with knowledge,
skills, initiative, drive and spirit of innovation who
aims at achieving goals.

➢An entrepreneur identifies opportunities and seizes
opportunities for economic benefits.

SEVERAL DEFINITION OF ENTREPRENEUR

◦ Schumpeter: innovator who implements change in economy by
introducing new goods

◦ French word: entreprendre – under take or to try

◦ Kuratko & Hodgetts: individuals who organizes, manages, assumes
the risk & business

◦ Zimmer & Scarborgough: individual creates a new buss in the face
of uncertainty to achieve profit by identifying & capitalizing
opportunities and assembling the necessary resources

◦ Accept risks and opportunities of creating, operating, and growing
a new business

◦ Take risks to combine factors of production (capital, labour, raw
mat, land)

◦ Manages economic activity, sponsoring, owning, managing,
bearing risk of buss

 Carland:Establish a buss and manages it to obtain profit and to be
successful

 Who establish new entity to offer a new or existing product or service
into a new or existing mkt,

 Who able to perceive an opportunity for a buss and create an
organization to develop and manage that buss successfully

 Able to identify and seize the opportunity and bring in the necessary
resources e.g finance, workforce, raw materials to develop & mkt the
product & services.

◦ Takes proper action that imaginative, creative, and innovative

◦ Alert about buss opportunities that have not seen by the others

DEFINITION OF
ENTREPRENEURSHIP

 Process of creating and expanding business by
changing national development and societal
prosperity.

 Process seeking business opportunities under
conditions of risk.

 Process of creating something new value by
devoting the necessary time & effort, assuming
accompanying financial, physical and social risks
and receiving resulting reward of monetary,
personal satisfaction and independence.



Differentiate between Entrepreneur &
Businessman (Small)

Characteristics Entrepreneur Businessman

Time Unlimited Limited

Nature of job Flexible Rigid in adapting
to change

Decision making Make own Follow decision
decision made by others

Effort & Continuous Low
Commitment

Risk taker Moderate Low

Goal Maximization self Solely for profit

potential by maximization

utilizing

available

opportunities





THEORIES OF
ENTREPRENEURSHIP

✓ ECONOMIC
✓SOSIOLOGICAL
✓PSYCHOLOGICAL
✓ANTHROPOLOGICAL

ECONOMIC THEORY

◦Favorable economic conditions
◦Economics incentives as motivators
◦Incentives include taxation policy, industrial
policy, sources of finance and raw material,
infrastructure availability, investment and
marketing opportunities, and technology.

SOCIOLOGICAL THEORY

◦Society’s values
◦Customs & traditions
◦Religious beliefs
◦Social changes
◦Influence the behavior of individuals in a
society

PSYCHOLOGICAL THEORY

Necessary psychological characteristics

➢Vision
➢Foresight
➢Ability to face opposition
➢Need for high achievement
➢Self-reliance

ANTHROPOLOGICAL THEORY

◦People with high achievement orientation
are more likely to become entrepreneurs
◦Not influenced by money or external
incentives
◦Consider profit to be a measure of success
and competency

COMPETENCIES OF SUCCESSFUL
ENTREPRENEUR

◦ Personal initiative
◦ Seize opportunities
◦ Endurance
◦ Information seeker
◦ High work quality
◦ Commitment towards work agreement
◦ Efficient
◦ Systematic planning
◦ Creative problem solving
◦ Self confidence
◦ Assertion persuasion
◦ Power and authority

Attitudes, skills & knowledge
required by entrepreneur

Attitudes skills knowledge

Motivation Making decision Law

Confidence Solving problem Management

Initiative Negotiation Economics

Responsibility Communication Accounting
Risk taker Creativity Values

Diligence Team work business

Mental & physical Management Culture
fitness

Information seeker technical Project
management

The importance of entrepreneurship to
self, family and society development

Self
Being an entrepreneur takes commitment.



Family

• People have limited freedom in their jobs.
• 75% of workers don’t think their bosses keep the team motivated.
• The lack of motivation in their current job can inspire people to leave

and become an entrepreneur.



Entrepreneurs have great ideas

• Hewlett Packard is worth
over 30 Billion dolar today.

• They started with less than
$600.

• Obviously, this is an anomaly.

There is nothing wrong with
taking an existing idea and
making your own business
out of it.
As long as you are not break
the terms on anyone else’s
trademarks, patents, or
intellectual property – it is
fine.

Ethics, professionalism and social
responsibilities for entrepreneurs

customer

creditors staff

supplier Social environment
responsibilities

Society/ competitors
community

government



Prepared by Coordinator MPU 22012 PKS