Features
The nature and characteristics of entrepreneurship are:
1. Process: Entrepreneurship is a distinct process of creating something new, i.e., new products , processes, techniques and so on. The entrepreneurship process requires a good amount of managerial activities such as - planning, organizing, directing and controlling.
According to Joseph Schumpeter entrepreneurship is concerned with:
- Development of new technology
- Introduction of new product.
- Creation of new form of organisation structure.
- Develop,ent of new source of raw materials.
- Entry in new market.
2. Purposeful Activity: Entrepreneurship is purposeful activity. Emphasis is placed on results rather than mere activities. The results may be in the form of:
- Reduction in wastages.
- Optimum use of resources.
- Motivated and dedicated workforce.
- Increase in efficiency.
The main purpose of entrepreneurship activity is to aggrandize (increase) profits. Therefore, entrepreneurs place emphasis on cost-effective activities. The entrepreneurs undertake cost-benefit analysis of each and every activity. The analysis is made not only from short-term point of view, but also from long-term point of view' depending upon the nature of activity.
3. Individual or Group Activity: The entrepreneurship activity can be undertaken by an individual or by a group of individual.
- In case of small size projects, and where there is limited risk, the activity can be undertaken by an individual.
- In case of complex and large size projects, and where there are greater risks, the activity may be undertaken by a group.
4. Future Oriented Activity: Entrepreneurship activity is future oriented. The entrepreneurs need to plan and think ahead. The entrepreneurs need to undertake SWOT analysis. Therefore, there is a need to analysis internal and external environment that would be affecting the plans and strategies of the organisation.
5. Innovation and Creativity: Entrepreneurship activity involves innovation and creativity. The most successful entrepreneurs are the innovators. The innovators are on the constant look out for something different that would give them a competitive advantage. According to Joseph Schumpeter, a person behaves as an entrepreneur only when carrying out innovative activities.
The innovative activities may involve development of a new oroduct in the market, development of new and innovative schmes to promote the product, development of new techniques for production and distribution, etc.
6. Proactiveness: Entrepreneurship requires proactiveness. An entrepreneur is the one who takes proactive decision. Unlike traditional mangers, who take reactive decisions, an entrepreneur takes proactive decisions, and other follow the entrapreneur. Proactiveness gives first mover advantage or competitive edge in the market.
7. Expliots Change into an Opportunity: An entrepreneur always looks for a change. If there is a potential for a change, he responds to it. He expliots the change as an opportunity for different business. Seeking change and converting into an opportunity is the hallmark of entrepreneurship.
8. Risks and Rewards: Entrepreneurship activity is undertaken to assume risks and rewards. Any innovative activity is always subject to risks and uncertainties. If the innovative activity is successful, the entrepreneur will reap rewards, otherwise, the entrepreneur has to assume risks of failure. Therefore, an entrepreneur needs guts to assume risks, and he gets glory when there is success. It is to be noted that entrepreneurs take moderate risks, as compared to gamblers who take extreme risks.
9. Organizing Abilities: An entrepreneur requires highest level of organizing abilities. The entrepreneurship activity requires a proper blend of physical, capital and manpower resources. Right amount of resources, both in terms of quality and quantity needs to be organized so as to achieve higher level of returns.
10. Social and Economic Development: Entrepreneurship activity facilities social and economic development. Due to entrepreneurship, the production of bettter quality goods and services take place, which in turn facilities economic growth of the nation. Also entrepreneurs play an important role in social development by supporting social development activities like health, education, community development, etc.