1.5.2 Entrepreneurial Motives & Characteristics Flashcards
The main characteristics required to become a successful entrepreneur
are:
• understanding the market determination • passion •resilience • the ability to cope with risk.
Good entrepreneurs will need to be able to demonstrate a range of
common skills:
FINANCIAL, PERSUASIVE, PROBLEM-SOLVING, NETWORKING. Financial skills: This involves understanding key financial documents
and, more fundamentally, how finance allows a business to function.
• Persuasive abilities: Good entrepreneurs find a way of persuading many
people to do many things that their business needs, from suppliers to
staff to customers.
• Problem-solving skills: These are frequently shown by the ability to identify
causes of the problem and solve the problem by addressing these causes.
• Networking skills: With a wide range of possible business contacts,
entrepreneurs are more likely to find someone who can help when the
business needs help.
Reasons why people set up businesses
Profit maximising, profit satisficing, independence, home-working, ethical stance, social entrepreneurship
Profit maximising:
This means to continually seek to get the most
profit from every business transaction. Though this may seem the way
to get rich, it will often cause long-term problems, with consumers
feeling exploited or even cheated with substandard work caused by
skimping on materials and workmanship.
Profit satisficing
It means a business is making enough profit to keep shareholders happy or it’s sufficient for investors to maintain confidence in the management they appoint. with the need to accept lower than possible profits in the short term to
build a brand or a reputation. blending a desire for profit
with other factors, such as
building a good reputation
or having a good work-life
balance.
financial motives:
profit maximisation and profit
satisficing
non-financial motives:
ethical stance, social
entrepreneurship, independence and home working
More entrepreneurial characteristics
self confidence
- self determination
- self starter
- initiative
- commitment
- creative
- resilient
- risk taker
- hard working
- visionary
- passionate
More entrepreneurial skills
organisation
- communication
- financial management
- negotiating
- solving problems
- quick on their feet
- good at IT
- numeracy
- team working
More on profit satisficingw
where a business focuses on making enough profit so that the owner has a desirable quality of life, or that the shareholders are paid satisfactory dividends and not on maximising profit level
(to generate enough income to live a comfortable life)
Features of profit satisficing
entrepreneur will take fewer risks
- trade-off is lower returns
what is ethical stance?
running a business to support their ethical principles e.g climate change, reusable plastic
What is social entrepreneurship
running a business for a social or environmental cause to make a difference
