Marketing Manager Course - Chapter 08

McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
8
Chapter
Entrepreneurship
Entrepreneurship
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
After reading this chapter, you should be able to:
z
Distinguish between an entrepreneurship and a
small business.
z
Develop negotiation, networking, and leadership
skills that can help you as an entrepreneur.
z
Recognize why some entrepreneurships fail.
z
Analyze the advantages and disadvantages of the
legal forms of enterprises.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
(continued)
z
Learn how capital is raised through debt and
equity financing and recognize the merits of each
approach.
z
Evaluate alternative forms of entrepreneurship,
such as franchising, spin-offs, and
intrapreneurships.
z

Recognize and evaluate entrepreneurship as a
career path and a source of innovation and new job
opportunities.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Introduction
z
Creating a new enterprise is one of
the greatest management
challenges.
z
Entrepreneurs have built
successful companies by being able
to exploit unmet needs in the
market.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
What is Entrepreneurship?
z
The process of creating a
business enterprise capable of
entering new or established
markets.
z
It involves deploying resources
and people in a unique way to
develop a new organization.
z
An entrepreneur is an
individual who creates an
enterprise that becomes a new
entry to a market.

McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Entrepreneurship Myths
z
Myth 1: Entrepreneurs are born, not made.
z
Myth 2: It is necessary to have access to money to
become an entrepreneur.
z
Myth 3: An entrepreneur takes a large or irrational
risk in starting a business.
z
Myth 4: Most successful entrepreneurs start with a
break-through invention.
z
Myth 5: Entrepreneurs become successful on their
first venture.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Entrepreneurial Venture versus
Small Business Management
Small Business
z
Independently owned and
operated
z
Small in size
z
Does not dominate its
markets
z
Has less than 100

employees
Entrepreneurship
z
Growth is one of the most
important goals
z
The goal is to become a
medium-sized firm of 100-
499 employees; or
z
A large firm with 500 or
more employees.
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
The Importance of Entrepreneurship
z
Job Creation
¾
Entrepreneurship accounts for most new jobs in
the U.S. economy.
z
Innovation
¾
Entrepreneurships are responsible for
introducing a major proportion of new and
innovative products and services into market.
z
Opportunities for Diverse People
¾
People of diverse background can improve their
economic status by becoming entrepreneurs.

McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Key Characteristics of Entrepreneurs
z
High need for achievement
z
Internal locus of control
z
Willingness to take risks
z
Self-confidence
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Entrepreneurial Skills
z
Negotiation skills
¾
Ability to obtain resources that are
controlled by other individuals.
z
Networking skills
¾
Gather information and build alliances
9
Personal network
9
Business network
z
Leadership skills
¾
Provide a shared vision
McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.