1.5.1 & 1.5.2 Role of an Entrepreneur and Characteristics Flashcards
What is an ENTRPRENEUR?
an Entrepreneur is a PERSON who SETS UP a Business and TAKES RISK in the hope of a PROFIT or REWARD
What are the 4 MAIN ROLES of an ENTREPRENUEUR?
- INOVATORS
- ORGANSING
- KEY DECISIONS
- RISK TAKERS
Explain the ROLE of an Entrepreneur - INNOVATOR
they TRY to MAKE MONEY out of a BUSINESS IDEA
ideas might come from SPOTTING a GAP in the MARKET, a NEW INVENTION or Market Research
However, many people set up a business by copying or adapting what another business does
Explain the ROLE of an Entrepreneur - ORGANISING
RESPONSIBLE for ORGANISING other FACTORS of PRODUCTION
They BUY or HIRE RESOURCES
Organising involves GIVING INSTRUCTIONS, making Arrangements and setting up systems
Explain the ROLE of an Entrepreneur - KEY DECISONS
since they’re OWNERS, they have to make all the KEY DECISIONS. They make decisions on HOW to RAISE FINANCE , Product design , choice of PRODUCTION METHOD, PRICES , RECRUITMENT and wages
Explain the ROLE of an Entrepreneur - RISK TAKERS
they’re Risk Takers as they RISK LOSING any MONEY they PUT into the BUSINESS IF it FAILS
However, IF the BUSINESS is SUCCESSFUL, they will be REWARDED with PROFIT
What are 6 FUNCTIONAL BUSINESS TASKS
- FINANCIAL MANAGEMENT
- ADMINISTRATION
- MARKETING
- PURCHASING
- MANAGING PEOPLE
- PRODUCTION
What are INTRAPRENEURS?
EMPLOYEES who USE ENTREPRENEURIAL SKILLS, WITHOUT having to RISK their OWN MONEY, to find and DEVELOP INITIATIVES that will have FINANCIAL BENEFITS FOR their EMPLOYER
e.g. take risks, creative or innovative, solves problems
What is an ADVANTAGE of INTRAPRENEURS?
EMPLOYING INTRAPRENUERIAL STAFF is a means of SATISFYING the SELF-ACTUALISATION NEEDS of EMPLOYEES
If STAFF APDOT this ROLE they’re being GIVEN the OPPORTUNITY to be CREATIVE and REACH their FULL POTENTIAL
Helps MOTIVATE STAFF and happily RAISE their PRODUCTIVITY
What are 4 BARRIES to ENTREPRENEURSHIP - reasons why People Don’t Start A Business
- LACK of FINANCE
- Lack of ENTREPRENEURIAL CAPACITY
- LACK of IDEAS
- FEAR of FAILURE
Explain how LACK OF FINANCE is a Barrier to Entrepreneurship?
MANY CANNOT ATTRACT the NECESSARY FINANCE.
PROVIDERS (banks) of capital and loans may be RELUCTANT to LEND MONEY to START UPS
Explain how LACK OF ENTREPRENIAL CAPACITY is a Barrier to Entrepreneurship?
Many Lack the NECESSARY ENTREPRENEURIAL SKILLS and CHARACTERISTICS, ENERGY and COMMITEMRTNT.
So therefore FEWER BUSINESSES are SET UP
Explain how LACK OF IDEAS is a Barrier to Entrepreneurship?
No ORIGINAL IDEAS
Lots of MARKETS are SATURATED or SO COMPETITIVE that the POTENTIAL for PROFIT is LIMITED
Explain how FEAR OF FAILURE is a Barrier to Entrepreneurship?
FAILURE RATE for business START UPS can be HIGH, STOP THEM from STARTING A BUSINESS
