What is
entrepreneurial decision process?
Answer:
Entrepreneur:
An individual who gather resources
to create an economic activity while bearing different types of social and
economic risks.
Entrepreneurship:
It
is the process of creating something new;
1)
With the value of
devoting the necessary time & effort
2)
Assuming the
accompanying financial and social risks.
3)
And receiving the
resulting rewards of monetary and personal satisfaction and independence.
The Entrepreneurial Decision Process.
Some
ventures result from specific circumstances many entrepreneurs follow the
entrepreneurial process, which entails a movement form something to something a
movement from a present lifestyle to forming a new enterprise, as indicated in
Table .
Decision
for a potential Entrepreneur
Ø Change
from present lifestyle:
The decision to
leave a career or lifestyle is not an easy one. It takes a great deal of energy
and courage to change and do something new and different.
1)
Work
environment (R&C and Marketing)
While working in technology (research
& Development) individuals develop new product ideas or processes and often
leave to from their own companies when these new ideas are not accepted by
their employers (R&D)
2)
Disruption
(A negative force)
A significant number of companies are formed
by individuals who have retired, who are relocated due to a move by the other
members in a dual career family, or who have been fired.
There is possibly no greater force then
personal dislocation to galvanize (snock into taking action) a person’s will to
act.
Ø Form
New Enterprise
The
decision to start a new company accurse when an individual perceives that
forming a new enterprise is both desirable & possible
a)
Desirability
of new venture formation
Aspects
of a once situation that make desirable to start a new enterprise are culture,
subculture, family, teacher and peers.
1)
Culture:
A
culture that values an individual who successfully creates a new business will
spawn more venture formation that one that does not. The American culture places
a high value on being a success and making money all aspects of
entrepreneurship.
2)
Sub
– Culture:
Many subcultures
that shape entrepreneurial value systems operate within a culture framework.
3)
Family:
High percentage of the founders of
companies had fathers & mothers who valued Independent. The Independence
achieve by the companies owners, professionals.
4)
Teachers
Encouragement to
form a company is further stimulated by teachers who can significantly
influence individual to regard entrepreneurship as desirable
5)
Peers:
Finally, peers are very important in
the decision to form a company an idea with a pool and a meeting place where
entrepreneurs can discuss ideas, problems, and solution spawns more new
companies.
b)
Possibility
of new venture formation.
Factors making possible
to create a new venture are government, background marketing, role models, financing.
1)
Govt.
The Govt contributes by providing
the infrastructure to help & support a new venture.
2)
Background:
Formal education and previous business
experience give the skills needed to form and manage a new
enterprise.
3)
Marketing.
There must also be a level of
marketing know how to put together the best total package of product, price,
distribution and promotion needed.
4)
Role
Models:
To see someone else succeed makes it
easies to picture your self engaged in a similar activity.
5)
Financing:
Most
of the start up money for any new company comes from savings, credit, friends,
family and relatives; there is often need for
addition seed capital.
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