Download Entrepreneurship I

Entrepreneurship I
1.02: Participate in career-planning
to enhance job-success potential
Michelle Perry - Midway HS
1.02 Essential Questions
• What distinguishes an
entrepreneur from a
small business owner or
manager?
• What are the reasons that
people pursue careers as
entrepreneurs?
• What personality traits
are associated with
successful entrepreneurs?
• What skills are needed for
entrepreneurial success?
• How do we assess
entrepreneurial
potential?
• What are the risks and
disadvantages associated
with entrepreneurship?
• What are the trends and
technological
developments in
entrepreneurship?
Michelle Perry - Midway HS
What distinguishes an
entrepreneur from a
small business owner or
manager?
Michelle Perry - Midway HS
Distinguish among entrepreneurs,
small business owners, and managers
• Entrepreneur – an
individual who undertakes
the risk associated with
creating, organizing, and
owning a business
• Entrepreneurship – is the
process of starting and
operating one’s own
business
• Venture – is a business
undertaking involving risk
• Opportunity – is an idea
that has commercial value
• Small Business Owner – the
owner of a business that
was generally started to
create jobs for the owners
and referred to as a “mom
and pop” business
• Manager – an employee
who coordinates people,
processes, and other
resources of a business in
order for the business to
achieve success
Michelle Perry - Midway HS
What are the reasons
that people pursue
careers as entrepreneurs?
Michelle Perry - Midway HS
Identify reasons that people pursue
careers as entrepreneurs
• Being your own boss – this is the
biggest reward of owning your
own business – it gives you the
freedom to make their own
business decisions – they have
the final word on all aspects of
the operation
• Doing something you enjoy – a
business venture normally begins
with something that the
entrepreneur enjoys doing – it
might be a hobby or skill that
they are good at doing – the
entrepreneur gets satisfaction
from creating or developing the
hobby into a viable enterprise
• Having the opportunity to be
creative – most people who
works for someone else is
following their procedures; while
entrepreneurs create their own –
entrepreneurs are able to shape a
business in ways that employees
cannot – this is true with new,
daring or creative ideas – when
an entrepreneur has a creative
idea, they have the power to act
on it
Michelle Perry - Midway HS
Continued…
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Having the freedom to set your own
schedule – even though
entrepreneurs have demands on
their time, they have the flexibility to
determine their own schedule –they
also have the options of working at
home, at the business, or any other
location that suits them
Having job security – employees
today are not guaranteed job security
from their employers – businesses
may relocate outside the United
States and the employees are left
with no company to work for –
entrepreneurs control their own
destiny – as long as the business is
successful, they have a job
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Making more money – people who
work for others are paid wages or a
salary – if you work for a company
and they do well, you may get a raise
or a bonus – a business owner’s
earnings are limited by the potential
of the business
Being recognized within the
community – business ownership
carries with it a certain amount of
prestige – entrepreneurs have taken
on a responsibility that involves hard
work, daring, and know-how –
entrepreneurs make an economic
contribution to the community
through their investment and
creation of jobs
Michelle Perry - Midway HS
What personality traits
are associated with
successful
entrepreneurs?
Michelle Perry - Midway HS
Describe personality traits associated
with successful entrepreneurs
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Persistent – willing to work until a job
is done, no matter how long it takes –
they are tenacious in overcoming
obstacles and pursuing their goals
Creative – they look for new ways to
solve old problems
Responsible – they do not pass the
buck – they take responsibility for
their decisions and actions
Inquisitive – they want to know as
much as possible about whatever
affects their venture – they conduct
research and ask questions to solve
problems. You like to ask questions??
Goal-oriented – they set and achieve
goals
Independent – they want to make
their own decisions
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Self-demanding – they have high
expectations
Self-confident – they believe in
themselves
Risk-taking – they take risks, but they
are not reckless
Restless – once they achieve their
goals, they begin looking for new
challenges
Action-oriented – they are doers as
opposed to spectators – they set
goals, make decisions, and act on
their decisions
Enthusiastic – they are energetic and
passionate about their pursuits
Michelle Perry - Midway HS
What skills are needed
for entrepreneurial
success?
Michelle Perry - Midway HS
Explain skills needed for
entrepreneurial success
• Communication skills – person-to-person, telephone, and written
communication skills – also need listening skills to build positive
relationships – do accurate work
• Math skills – they use basic math skills to budget, keep records,
make decisions and calculations, and put together financial
statements + / >
• Problem-solving skills – they need to be able to come up with
logical ideas to solve problems – solving problems requires
creativity and thinking skills
• Technology and computer skills – computer skills are essential in
almost any business – the ability to understand and use technology
is also essential
• Decision-making skills – they must be able to choose the best
option from among many – good decision makers know their values
and are good at predicting the consequences of actions
Michelle Perry - Midway HS
Skills Continued…
• Organizing and planning skills – they must be expert organizers and
planners, which require logical thinking and good time
management
• Teamwork skills – they need teamwork skills to coordinate and
manage work teams – this involves respecting others, being flexible,
and knowing when to exercise leadership
• Social skills – they need social skills to interact well with employees,
customers, and vendors – involve verbal and nonverbal behavior
• Adaptability skills – they should be adaptable because they
business and economic environment is constantly changing
• Basic business skills – they should have a basic understanding of
how the economy works and an understanding of fundamental
concepts of finance, marketing, and management
Michelle Perry - Midway HS
How do we assess
entrepreneurial
potential?
Michelle Perry - Midway HS
Demonstrate procedures for assessing
entrepreneurial potential
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Assessing your entrepreneurial
characteristics and skills
Develop your profile (set of characteristics or
qualities that identifies a type or category of
person) based on being a successful
entrepreneur
Identify your strengths and weaknesses
Continue to work at maintaining and/or
improving your strengths
Another way to strengthen your
entrepreneurial potential is to think and act
like an achiever (is a person with a record of
successes)
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Develop the foundation skills and if these are
your weaknesses then take courses or classes
to improve the skills Set out to be the best at
whatever you do
Set your sights on accomplishing the
extraordinary
Write your goals down on paper
Pursue your goals with confidence and
commitment
View difficulties as opportunities to learn
and grow
You do not need to be an expert, however,
you must develop the skills necessary to set
up and run a successful business
Obtain employment is similar or related
positions to improve and monitor your skills
Michelle Perry - Midway HS
What are the risks and
disadvantages
associated with
entrepreneurship?
Michelle Perry - Midway HS
Risks/Disadvantages
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Working long hours – long hours are the
norm for entrepreneurs, especially during
the start-up period – during start-up
survival depends on making wise
decisions and not relying on paid help, so
the responsibilities are left to the
entrepreneur – many entrepreneurs work
7 days a week from the time the business
opens until close. Over 40 hours per week.
Having an uncertain income – business
owners make more money than
employees; but only when the business is
good and making money – if a business is
bad then earnings can be low or
nonexistent – most businesses do not
make a profit right away – most business
owners put the profits back into the
business so that it can grow – business
owners do not get a paycheck or benefits
such as health insurance and time off for
vacations
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Being fully responsible – the owner of a
business is responsible for more than just
decision making; they must make sure
everything get done – there is no one else
to take care of tasks such as sweeping the
floors, paying bills, making repairs or
other tasks in the business – the success
or failure of the venture rests entirely on
the owner
Risking one’s investment – the biggest
risk is the possibility of losing one’s
investment – the investment is the
amount of money a person puts into their
business as capital – capital includes the
buildings, equipment, tools, and other
goods needed to produce a product or the
money used to buy these things –
employees do not risk losing money –
before an entrepreneur can earn money
they have to get the venture up and
running
Michelle Perry - Midway HS
What are the trends and
technological
developments in
entrepreneurship?
Michelle Perry - Midway HS
Trends in entrepreneurship
• Internet businesses – new online businesses have emerged
along with traditional businesses adding an online feature –
online businesses have the potential to attract a huge number
of customers because anyone with internet capabilities can
shop at any time
• Service businesses – dominant type of businesses in the
United States economy – even if a company sells a product,
they also provide a service to the customers – most small
businesses are service businesses – services are intangible
things that businesses do for their customers to enhance our
lives – examples include: insurance, sports and entertainment,
tourism, banking, real estate, dry cleaning, fitness centers,
and accountants/tax preparers
Michelle Perry - Midway HS
Trends…
• Home-based businesses –Conducted from the home – due to
technology a home-based business can have an image that is just as
professional as that of a large corporation
• Socially responsible nonprofit businesses – social entrepreneurs
start a business in order to better society – they are focused on
doing good – social entrepreneurs often form nonprofit
organizations (the business owner makes a profit; but the profits
must be kept within the business) – some nonprofits also can
qualify to be tax-exempt – examples of nonprofits that support
specific missions include feeding the hungry, community theatre
groups, education-focused groups, and building homes
• Focus on technology – entrepreneurs who know how to use
technology to improve their business processes create a strong
competitive advantage and enjoy a greater chance of success –
whether technology is a company’s product or it is used to increase
productive, it is a critical component of any business strategy
Michelle Perry - Midway HS
Trends…Outsourcing
• Outsourcing – is contracting with other companies for
services – most common types of outsourcing is
business-process outsourcing (accounting, human
resources management, benefits, payroll, and finance
functions) – benefits of outsourcing:
– outsourcing allows greater efficiency, saving time and
money
– outsourcing decreases overhead investment or debt
– outsourcing lowers regulatory compliance burdens
– outsourcing allows companies to start new projects quickly
– outsourcing makes companies more attractive to investors
because it allows companies to direct more capital directly
into money-making activities
Michelle Perry - Midway HS
Other Trends
• Strategic Alliances – one step beyond outsourcing is
forming a partnership with another company – join with a
larger company to purchase items in large quantities or
help support a product – example: 3M produces tape and
will look to smaller companies to provide the dispensers
• Corporate Ventures – is a new venture started inside a
large corporation – large companies are finding that they
must act like entrepreneurs to remain competitive – these
are spin-off companies – the parent company supplies
resources to the corporate venture get started – often the
new corporate venture becomes an independent company
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Michelle Perry - Midway HS
Reasons that business
start-ups often fail
Michelle Perry - Midway HS
Reasons for failure
• The overall cause of business failure is:
– lack of control on the part of the entrepreneur.
• Never leave total control of your business to
your employees even if they are professionals.
Remember, professionals are only there to
advise you on what to do. The final decision lies
in your hand as the entrepreneur and business
owner!
Michelle Perry - Midway HS
• High Debt Ratio - the 1st cause of business failures.
This is the measurement of the percentage of total
dollars in a business that is provided by creditors. You
are looking at what you owe your creditors in
comparison to what the business owns in assets. If you
owe your creditors $59,000 and your assets (what the
business owns) are $106,000 then your debt ratio is
55.6%. This means that 55.6% of what you own would
have to be sold off to pay your creditors.
• High level of mismanagement -The 2nd cause of
business failures. If your key staff lacks professionalism,
then your business is in trouble. Since your staff are in
charge of running the day to day affairs of your
business, their professionalism should not be
compromised for anything.
Michelle Perry - Midway HS
• Unexpected resignation of staff -The 3rd reason. This
can really pose a threat to your business so you must
be prepared for it. In business, poaching is really a
factor to deal with. Big companies are always poaching
good employees away from other companies by
enticing them with improved salaries and incentives.
• Inadequate Inventory - If you have inadequate stock
either for production or for your customers, your
business is bound for failure. Also; if you stock too
much inventory, you are still bound to fail because you
are tying down working capital.
• Selling products below cost price - The 5th cause of
business failures . Sometimes in business, cash crunch,
fierce competition or economic factor make businesses
sell their goods below cost price and this can ruin your
business.
Michelle Perry - Midway HS
• Dwindling working capital - Depreciating working capital may
be as a result of unnecessary expenditure, too much
inventory and weak cash flow management on the part of the
entrepreneur.
• Consistent negative cash flow – The 7th factor. Cash flow is to
a business what blood is to humans. No business can survive
without strong cash flow management. A solution to negative
cash flow is to hire a professional accountant to keep a keen
eye on the cash flow.
• Declining Profit - If there is a down turn in profit margins due
to competition or deflation, your business could be negatively
affected. A solution to declining profit is to increase your sales
volume so you can make more profit on turnover or better
still; diversify.
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Michelle Perry - Midway HS
• Loss of market share - Loss of market share is the 9th
cause of most business failures. If you observe you are
losing your market share due to either competition,
new technology, innovation or trend, then this is a sign
that your business is on the verge of been liquidated.
• Inability to secure operational capital - Lastly, your
inability to secure funds from financial institutions
could lead to business failure. Raising capital is one of
the most difficult tasks in business. But it is often said
that “where there is a will, there is a way.” If financial
institutions refuse to assist you financially, you have to
turn to other sources of funds
Michelle Perry - Midway HS
Reasons that entrepreneurs need to
be aware of industry trends and
technological developments
• By observing the world around you and looking at
demographic changes, the development of new ideas
can identify a possible business opportunity or
expansion of a current business
• Popular trends such as health and fitness; ethnic
diversity; and an improving economy can provide
guidance in product development
• Technology and industry trends can assist in the
business operations
• Recognizing new trends and to think creatively are
essential for business success
Michelle Perry - Midway HS
Professional-development
opportunities for entrepreneurs
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Government agencies such as SBA
Workforce Development agencies
Chamber of Commerce
Community colleges to improve skills
Professional organizations
Trade associations
Internet programs
Mentor/relatives
Michelle Perry - Midway HS
Discussion
and
Questions
Michelle Perry - Midway HS
"Professional Presence In The Workplace - How to
demonstrate Professional Presence in the
Workplace"
https://www.youtube.com/watch?v=FsimbWV7Ek0
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They Love
https://www.youtube.com/watch?v=y9olVPiXN-s
Michelle Perry - Midway HS