Entrepreneurship
The word “entrepreneur” is derived from the French verb “entreprendre”, which means ‘to undertake’. This refers to those who “undertake” the risk of new enterprises. An enterprise is created by an entrepreneur. The process of creation is called “entrepreneurship”.
Meaning
Entrepreneurship is a process of actions of an entrepreneur who is a person always in search of something new and exploits such ideas into gainful opportunities by accepting the risk and uncertainty with the enterprise. It is the process of starting a business, a startup company or other organization. The entrepreneur develops a business plan, acquires the human and other required resources, and is fully responsible for its success or failure.Entrepreneurship operates within an entrepreneurship ecosystem.
Definitions
According to A.H.Cole
Entrepreneurship is the purposeful activity of an individual or a group of associated individual,undertaken to initiate,maintain or aggrandize profit by production or distribution of economic goods and services.
According to J.A. Timmons
Entrepreneurship is the ability to create and build something from practically nothing.
According to Musselman and Jackson
“Entrepreneurship is the investing and risking of time, money and effort to start a business and make it successful.
Characteristics of Entrepreneurship
Entrepreneurship is characterized by the following features:
1. Economic and dynamic activity
Entrepreneurship is an economic activity because it involves the creation and operation of an enterprise with a view to creating value or wealth by ensuring optimum utilization of scarce resources. Since this value creation activity is performed continuously in the midst of uncertain business environment, therefore, entrepreneurship is regarded as a dynamic force.
2. Related to innovation
Entrepreneurship involves a continuous search for new ideas. Entrepreneurship compels an individual to continuously evaluate the existing modes of business operations so that more efficient and effective systems can be evolved and adopted. In other words, entrepreneurship is a continuous effort for synergy (optimization of performance) in organizations.
3. Profit potential
“Profit potential is the likely level of return or compensation to the entrepreneur for taking on the risk of developing an idea into an actual business venture.” Without profit potential, the efforts of entrepreneurs would remain only an abstract and a theoretical leisure activity.
4. Risk bearing
The essence of entrepreneurship is the ‘willingness to assume risk’ arising out of the creation and implementation of new ideas. New ideas are always tentative and their results may not be instantaneous and positive.An entrepreneur has to have patience to see his efforts bear fruit. In the intervening period (time gap between the conception and implementation of an idea and its results), an entrepreneur has to assume risk. If an entrepreneur does not have the willingness to assume risk, entrepreneurship would never succeed.
