What are the characteristics of an entrepreneur?
- Risk Taking
As it is impossible to eliminate risk from any type of business, there is always an element of risk associated with any business. Entrepreneurs should not be careless but they should accept some risk. An entrepreneur cannot avoid all business risk and must be able to cope with it.
- Time and Energy
Running a business takes time and energy. Professional managers can be brought in if a business generates sufficient income but the development of a business is hard work. This means that willingness to work is important. Running a business can effectively take over the life of an entrepreneur. Entrepreneurs tend to enjoy a challenge/solving problems.
A new business requires inititative, readiness to come up with ideas, make decisions and take action. Dithering or too frequently changing a business strategy creates problems, as does an ineffective approach. In the starting up of a business, there are normally problems so self-confidence, determination and resilience to keep on going are normall valid characteristics of an entrepreneur.
- Strict Leadership Style
- Orders Obeyed without question
- Employees Either Respect or fear the leader
+ Instructions usually followed accurately and quickly
-- Less effective where fresh ideas, flexibility and having proactive staff are valued.
- Employees Seen as a key asset
- Leader still has authority but takes kind and suportive approach to employees
- Considers welfare of employees in decisions.
+ Can win Loyalty and motivate employees
-- People may not work as hard, as may not feel under as much pressure.
- Involves employees in decision making
- Still ultimately makes decisions, but seeks advice of employees
+ Employees May Produce Better Ideas than the boss could alone, more likely to feel respected and valued.
-- Reaching decisions will take more time, may end up empowering employees.
- Employees left to do things their own way
- May choose own working hours, for example.
- Works better with trusted, small companies.
+ Freedom allows less pressure and better ideas.
-- If not the right person, they may spend long periods of time producing little/poor quality work.
Identifying a business opportunity
What Makes a Market?
A market is a system that allows buyers and sellers to agree prices and trade. A market may not necessarily need to be a physical place and can be online such as ebay and call centres. Businesses earn revenue by selling their products or services. This means that they have to have a product that customers are willing to buy.
Giving priority to customers wishes over the product is called being market orientated as opposed to being product orientated. This means having a U.S.P is useful.
Another approach is to think in terms of competitive advantage, being anything which gives your firm an edge over rivals. Recently, there has been increasing efforts put into marketing rather than producing for this reason.
Market differentiation can be accieved by building a strong brand and brand image. Competitive advantage can…