Free Essays on Dropping the Atomic Bomb

Dropping the Atomic Bomb On August 6, 1945 the nuclear bomb was dropped on the Japanese city of Hiroshima. The Enola Gay, guided by Colonel Tibbetts, was picked to make the mission. The strategic recorded as fruitful by Capt. William S. Parson at 9:20 A.M. This was an incredibly questionable military methodology in the United States. Was the United States supported in the dropping of the nuclear bomb? Indeed, they were legitimized for some reasons. The essential explanation was, that it would stop the war. How can it be that this war should have been halted so seriously? Despite the fact that here and there it was helping our economy, it was expensive in both cash and lives. Likewise, the United States troopers were experiencing cruel treatment by the unmerciful Japanese. Another explanation the war should have been halted was to protect ourselves from another assault on U.S. soil, which thus would slaughter a significant number of our U.S. residents. This is the reason the war should have been halted; in th is way, legitimizing the utilization of the nuclear bomb. World War II was the costliest war ever, regarding lives lost. No definite figures exist, yet around somewhere in the range of 15 and 20 million military work force were slaughtered. Of these, 292,000 were Americans and 6,000 guiltless United States residents were killed by our foes. It has been evaluated that if the United States had not dropped the bomb and had attacked Japan rather, the United States would have lost around a million troopers. The Japanese self-destructive battling systems incredibly affected this number. The Japanese would prefer to kick the bucket than give up. This is shown by the skirmish of Saipan. At this fight over portion of the number of inhabitants in Saipan strolled off a bluff as opposed to giving up to the United States. This was regularly viable. Commonly when a Japanese trooper chose to explode himself as opposed to giving up he would slaughter numerous Americans with a similar impact. Additi onally the kamikaze methods of the Japanese contenders murdered numerous troopers. In the event that this wa... Free Essays on Dropping the Atomic Bomb Free Essays on Dropping the Atomic Bomb Dropping the Atomic Bomb On August 6, 1945 the nuclear bomb was dropped on the Japanese city of Hiroshima. The Enola Gay, directed by Colonel Tibbetts, was picked to make the mission. The strategic recorded as effective by Capt. William S. Parson at 9:20 A.M. This was an incredibly disputable military methodology in the United States. Was the United States supported in the dropping of the nuclear bomb? Indeed, they were legitimized for some reasons. The essential explanation was, that it would stop the war. Can any anyone explain why this war should have been halted so gravely? Despite the fact that somehow or another it was helping our economy, it was expensive in both cash and lives. Likewise, the United States warriors were experiencing brutal treatment by the unmerciful Japanese. Another explanation the war should have been halted was to safeguard ourselves from another assault on U.S. soil, which thusly would slaughter huge numbers of our U.S. residents. This is the reason the war should have been halte d; along these lines, legitimizing the utilization of the nuclear bomb. World War II was the costliest war ever, as far as lives lost. No precise figures exist, yet around somewhere in the range of 15 and 20 million military faculty were executed. Of these, 292,000 were Americans and 6,000 blameless United States residents were killed by our foes. It has been assessed that if the United States had not dropped the bomb and had attacked Japan rather, the United States would have lost around a million officers. The Japanese self-destructive battling techniques significantly affected this number. The Japanese would prefer to kick the bucket than give up. This is exhibited by the skirmish of Saipan. At this fight over portion of the number of inhabitants in Saipan strolled off a bluff as opposed to giving up to the United States. This was regularly exceptionally successful. Ordinarily when a Japanese trooper chose to explode himself as opposed to giving up he would execute numerous Ameri cans with a similar impact. Additionally the kamikaze methods of the Japanese contenders executed numerous warriors. In the event that this wa...

Management Case Study: Coca Cola Company

The board Case Study: Coca Cola Company Cola-Cola Company Roadmap begins with their main goal, which is long haul. It announces their capacity as an organization and fills in as the standard against which their weight of activity and choices. The strategic Coca-Cola Company is to invigorate the world, to rouse snapshots of hopefulness and satisfaction, to make worth and have any kind of effect. Vision Vision fills in as the system for Coca-Cola Company Roadmap and aides all aspects of the business by portraying what they have to accomplish so as to keep accomplishing reasonable quality development. Individuals, be an enormous work environment where individuals are urged to be as well as can be expected be. Portfolio, bring to the world an arrangement of greatness drink marks that expect and convince people groups wants and needs. Accomplices, support a triumphant system of clients and providers, together they make public, suffering worth. Plane, be a mindful inhabitant that makes a unique by helping assemble and bolster practical networks. Benefit, augment long haul come back to investor while monitoring their general obligations. Efficiency, be a profoundly fruitful, twist and quick moving association. Coca-Cola items Coca-Cola organizations have an exceptionally limited items go which are Coca-cola, Sprite and Fanta. Those items are sold in the market with a distinction size of jugs which are 250ml, 300ml, 1liter and 1.5liter pet. Functioning as a Global Team Coca-Cola organizations worked around two center resources, its brands and its kin. That is the thing that makes working at Coca-Cola so extraordinary. They accept that work is a spot that the business need go each day. It ought to be a position of investigation, imagination, proficient development and relational connections. Its about being enlivened and spurred to accomplish remarkable things. They need individuals to invest heavily in their work and in building brands others love. All things considered, its the joined gifts, aptitudes, information, experience and enthusiasm of our kin that make us what our identity is. Coca-Cola Company has 92,800 partners the world over live and works in the business sectors. They serve in excess of 87 percent of them outside the United State. In the topographically differing condition, they gain from each market and offer those adapts rapidly. Therefore, Coca-Cola Company culture is always communitarian. From refreshment idea and advancement to promoting, Coca-Cola partners are sharing idea across offices and markets in new manners. Thus, Coca-Cola partners are expanding excited about their work and motivated to transform plans without hesitation. With an arrangement of in excess of 3,300 rundown of item, from diet and standard shining refreshments to in any case drinks, for example, 100 percent natural product squeezes and organic product drinks, waters, sports and caffeinated beverages, teas and espressos, milk-and soy-based drinks, Coca-Cola Company assortment traverses the globe. The board Function Arranging Definition Arranging is the way toward defining objectives, creating key, illustrating undertakings and afterward choosing how best to achieve them. Because of the arranging procedure, everybody in the association realizes what ought to be done, who ought to do it, and how it ought to be finished. It is a point by point customized in regards to future game-plan. Plan likewise a diagram determining the asset portions, plans, and different activities vital for accomplishing objectives. It characterizing objectives and afterward deciding the exercises and assets required to accomplish them. Arranging can be contrast of type, an association can order a portion of the significant sorts of plans which are the money related and non monetary plans, formal and casual plans, explicit and routine plans, vital and useful plans, long range and short range plans and the last authoritative and operational plans. Arranging capacity is essential to the supervisors, directors need to design so the laborer exerci ses are reliable with the association objectives and the right kind and measure of assets likewise can be gained. An arranging capacity requires data, judgment and dynamic. Hypotheses As indicated by Dror (1974), he says that arranging is the way toward setting up a lot of choice for activity in future, coordinated at accomplishing objectives. As indicated by Professor Stoner (1997), he says that arranging is of building up goals and fitting game-plans before making a move. As indicated by Archibugi (2008), state that arranging is a strategy for settling on balanced choice; a technique that is, somewhat, basic to numerous zones. Genuine Practice For a Coca-Cola organization, arranging is critical to them in light of the fact that as indicated by Joel Ross and Michael Kami hypothesis, they believe that an association without the procedure arranging resembles a boat without a rudder, circumventing the circle. Its like a tramp that is no spot to go to. Key arranging, usage and plan are the center administration work. Probably the greatest factor for deciding if the association performs up to its latent capacity or not is the degree to which the supervisory crew plays out, the system making and vital actualizing capacity. Coca-Cola association imagines that solitary the great key and great executions are the most dependable verification of good administration. A key arrangement is the scaffold of things to come, which an association uses to lead from what it is to what it imagines it can turn into. Arranging likewise can be a future strategy. Arranging is worrying about look forward into the future and deciding the vision, crucial target of the venture or program. Vision is that gives the general casing of reference inside which statements of purpose are composed and objectives chose. It likewise is the ideal future condition of association. As per Peter F. Drucker, destinations are basic in all the key zones where execution and results straightforwardly add to the development and endurance of a business. The vision of the Coca-Cola association is to turn into the best and the greatest grapple bottler on the planet. They crucial to invigorate the world, to make worth and have any kind of effect wherever they lock in. In the Coca-Cola association, a large portion of the objectives setting and arranging exercises are taking care of by the top administration. The top chief had set three destinations for the Coca-Cola association. The targets of Coca-Cola can be named the vital obj ectives, strategic objectives and operational objectives. Vital objectives are proclamations of what an association wish to accomplish over the time of the vital arrangement prefers throughout the following years, next five years. The vital objectives are viewed as when organization is thinking about the drawn out targets. This vital objective is set up by the top administration with discussion by the parent organization head quartered at Singapore. The top chiefs need to ensure that they are in accordance with the changing condition that they need to survey in the yearly gathering each year. This objectives is to ensure that Coca-Cola organization can proceed give the quality items to the important clients, to extend an extraordinary corporate and attempt to fulfill the client through additional normal assistance and a superb help alongside the total strategic and operational help. The directors additionally need to choose and hold in proficient individuals for the association. Ano ther, the strategic objectives which are characterize the results that significant divisions and offices must accomplish for association to arrive at its general objectives. The top chiefs of the Coca-Cola Company on a yearly premise devise these objectives along with the discussion of the lower level representatives. From that point onward, each departmental executive need to partition the yearly assignments on the quarterly or month to month premise to have a legitimate check to ensure that these goals are accomplished mostly through the promoting after the yearly errands is given. During the current year, directors need to guarantee that Coca-Cola can build the income by 20% of the looked at a year ago and increment the all out retail client around 10%. They likewise need to expand the piece of the overall industry by 5% and 30% of the reactivate the limits of clients. Last, the operational objectives which is that the administrators set to guarantee that every worker can accompl ish their own objectives and determined what are anticipated from them and afterward they are assessed based on specific standards and guidelines followed equally by theã‚â company. This operational objectives may emerge some issue which is some new sales rep can't arrive at their objectives so the supervisors need to guarantee that the sales reps can locate the new client, hold existing one and bring back the ceased accounts by giving them some preparation. Likewise, arranging is fundamental in settling on the executives choices. Dynamic is the investigation of recognizing and picking options dependent on the qualities and inclinations of the leader and it is the procedure of adequately diminishing vulnerability and uncertainty about choices to permit a sensible decision to be produced using among them. A terrible dynamic will have an awful outcome so a decent supervisor should great in dynamic, they need to must sure that each choice they make is useful for the association. The dynamic procedure in the Coca-Cola organization is concentrated. There are six stage in the dynamic of the Coca-Cola organization which are perceive need to settle on choice, create options, evaluate the other options, pick among options, actualize pick and last the gain from criticism. In Coca-Cola organization, choice which consistently takes by the top director can identified with the bundling situating, exchange limits, commercial, value decreases and disper sion. So as a finish of arranging, arranging is the main device of the four capacities in the administration procedure. It is properly said Well arrangement is half done. Contrast with the hypothesis and genuine practice, them two are worried with the future activity which is the manner by which to accomplish the associations objectives with those targets that ar

New Student Series Part 9 Ruchita Brajabasi COLUMBIA UNIVERSITY - SIPA Admissions Blog

New Student Series Part 9 Ruchita Brajabasi COLUMBIA UNIVERSITY - SIPA Admissions Blog Today marks our final installment of the New Student Series. Weve been introduced to some extraordinarily talented people, and everyone here in the Admissions Office knows theyll accomplish great things at SIPA.  Ive truly enjoyed getting to know some of our incoming students, and I hope you have too!  After youve read about Ruchita Brajabasi, whos a Teach for India fellow, take a look back at the eight  other students featured on the blog this summer. Im sure youll be just as inspired as we were! Full Name:  Ruchita Brajabasi Program:  Master of Public Administration Concentration: Urban and Social Policy Specialization:  International Organization UN Studies Anticipated Graduation Year:  2017 Hometown: Kolkata, India Undergraduate university, major and graduation year: Manipal University, Biomedical Engineering, 2011 What’s your professional background? I started my career with Accenture, where I worked on designing project management tools. It was a great learning experience because I had to understand the methodologies of product development and management to design tools for it! So I learned best practices of the entire processfrom gathering stakeholder expectations till deployment. My next career stint changed my life in more ways than I can express. I worked as the class teacher for 90 sixth-grade students in an affordable private school in the slums of Mumbai as a Teach For India Fellow. I started with the audacious dream of transforming lives; I think I came out more transformed myself! Did you apply to SIPA to change careers or to gain experience in a career path you already have experience in? While working in the community, I developed empathy for the grassroots perspective. I applied to SIPA to further my understanding of development problems and the means to solve them. What was your reaction when you found out you were accepted to SIPA? I cried. Why did you say yes to SIPA? A number of reasons: I truly believe we learn the most from our peers, and SIPA has the most eclectic mix of students! SIPA’s courses and opportunities cover almost everything under the (development) sun.  One can come out with the precise skills, knowledge and networks one needs to meet his/her vision. NYC. What do you most look forward to as a graduate student at SIPA? Engaging with the 3 Ps (Peers, Professionals and Professors)! Do you have any apprehensions about starting graduate school? It’s a mix of apprehension and excitement: I’ll be leaving behind all that is familiar, and head on to the crazy unknown! But being a math lover, I work best with variables and unknowns,  so it should be fun! What are your goals after SIPA? My vision is to create an equitable society through collaborative educational policy making. After SIPA I would like to work with Governments and International Organizations to develop, implement, and monitor schemes that lead to equity in society. If you could change one small thing about your community, country or the world, what would it be? I would make everyone a better listener. Tell us something interesting about yourself: I have studied in seven different schools and have lived in 14 cities all across India!

Essay on New Media and Public Relations Practice

Introduction New media has caused and continues to send ripples and shock waves throughout the realm of public relations (PR) practice. Increased public and stakeholder access to the internet has in particular set the demand for information from PR practioners at an unprecedented level (Galloway, 2005). Whilst past research findings indicated that PR practioners were ready to accept and use new media in the performance of their functions (Porter Sallot, 2003), current signs show that many are still grappling with the impact of new media on their practice. The term new media is normally used in reference to an array of media practices that utilize digital and computer technologies in one way or another. More notable is the fact that some definitions of new media integrate aspects related to the culture and/or contexts within which the new media is used (Dewdney Ride, 2006). New media technologies share the characteristics of having wide reach, being portable and in effect, enhanced mobility (Galloway, 2005). New media continues to pose significant challenges for PR practitioners especially because it forces them to look for means and ways to marry their traditional PR practice and roles with new and emerging technologies as well as adapt their delivery of information to the usage patterns of these technologies amongst their key publics and stakeholders. In essence therefore, effective application of PR theoretical frameworks to new media, redefinition of the scope of PR practice to cater for the increased demand for information by various stakeholders which is prompted by these technological developments and the aspect of having to acquire technical knowledge and skills without additional remuneration or support are amongst the major challenges PR practitioners face in their use of new media to communicate with key publics and stakeholders. Body Effective application of PR theoretical frameworks to new media is one of the formidable challenges faced by PR practioners in their quest to utilize new media (James, 2008, p.139). For instance, the application of theoretical frameworks to new technologies for the purposes of establishing and maintaining symmetrical two-way communication between organizations, their publics and stakeholders has been identified in various studies as one of the challenges faced by PR practitioners. Findings from these studies further concur that despite the fact that new media have and continue to offer the means for PR practitioners to potentially enhance two-way communication by employing PR theoretical frameworks for instance the model for two-way symmetrical communication by Grunig and Hunt (1984), the goal remains a mirage for many organizations. The McAllister and Taylor (2007) study of community college websites which had aimed to determine whether the said websites fostered two-way communication relationships is just but one examples of these studies. The study concluded that majority of the websites lacked the interactive features necessary for PR practitioners to solicit for opinions, information or inputs from key stakeholders. A study on online investor relations by Hessink, Boggen and Steggink (2007) echoed similar sentiments pointing out that the provision available on most corporate websites for investors to make enquiries via email did not fulfill the criteria for two-way symmetrical communication. Quality and timely company responses to email inquiries were the indicators of effective two-way communication in this particular study. In essence therefore, the inability to effectively apply various PR theoretical frameworks to new media with an aim of enhancing the capacity of PR practitioners to collect vital inform ation as well as monitor the opinions of key stakeholders remains a major challenge for PR practitioners. PR practitioners are also faced with the challenge of keeping abreast with already available technologies as well as technologies whose releases are planned for the future. This is due to the fluid and dynamic nature of technology with new technologies being developed and updated every day (James, 2008, p.140) The latter is compounded by the fact that the aforementioned changes in technology continue to prompt changes in the usage of these technologies among the various organizational stakeholders.   For example, many stakeholders currently expect that content delivery during any event should be done via digital projectors and power-point presentations. Others on the other hand expect the afore mentioned technologies to be coupled with internet access so as to allow presenters during such events to integrate content that is available online with their presentation when they deem it necessary. In this regard, PR practitioners especially those planning for large scale PR projects with a half-life of several years like major international events face the daunting task of having to plan and revisit their plans so as to ensure they accommodate any changes in technology and its usage among their key stakeholders. Moreover, PR practitioners need to be more technologically savvy in areas like software operations, web analytics and publishing amongst others (Nowland, 2006). Recent trends also indicate that PR agencies are broadening their requirements during recruitment exercises so as to ensure that they also hire staff with other areas of expertise for instance in technology besides PR. In short therefore, PR practioners need to acquire skills and knowledge in the use of new media or face extinction. Dynamism in the usage of new media amongst various organizational publics and stakeholders has put PR practitioners under significant pressure to ensure that they provide instant access to content.   Ã‚  For example, internet news services are a far cry from what they were in the past because they no longer rely on news wire services as their primary sources of information. In addition, due to increased internet access, organizations are no longer able to monopolize the information about their companies in the public realm because any stakeholder with internet access can place information about the organization on the net (Taylor Kent, 2006, p.146). This implies that PR practitioners are faced with the challenge of continually meeting the needs of public and stakeholder access to content, at their desired level of accuracy failure to which they will solicit for the information from other more readily available sources (Stephens, 2007, p.35). Enhancement of public and stakeholder access to content on the other hand poses significant ramifications on the relationships between PR practitioners and the management of the organizations they represent and their IT departments (James, 2008, p.145). This is so because for the PR practitioners to provide spontaneous consumer access to information, they must have the appropriate authority to release the information, establish or aid in the establishment of processes that foster the timely release of required content and finally, they must be equipped with technology appropriate for the uploading and/or subsequent dissemination of the content. Achievement of these needs comes at a cost because it greatly strains the PR practitioner relationships with other parties in the organization who feel that the PR department is encroaching on what they perceive to be their professional territory. As such, PR practitioners have the task of identifying processes that facilitate instant public a nd stakeholder access to information and at the same time establish a state of balance and harmony between PR functions and those of other departments in the organization (Pavlick Dozier, as cited in Porter and Sallot, 2003). PR practitioners additionally face the challenge of having to undertake additional work in the absence of a corresponding increase in personnel and/or budgetary allocations (Helsby, 2010). As previously discussed, the dynamic nature of new media as well as changes in the patterns of usage of these new technologies has significantly increased the work of PR practitioners. Further, new technologies have redefined and/or increased the management’s, public and stakeholder expectations of public practioners. For example, when planning for media releases, PR practitioners have to ensure that the content they prepare is appropriate for the various multimedia utilized by the key stakeholders they are targeting. This requires ample knowledge in stakeholder technology usage patterns and skills in the different types of new technology. These expectations are despite the fact that PR practitioners are experiencing difficulties in finding the funds, time as well as the support necessary fo r them to upgrade their skills and engage in professional development (James, 2008, p.144). Last but not least, PR practitioners are under pressure to redefine their the scope of their practice so as to accommodate the impacts of new media on their profession while ensuring that they continue to deliver on their traditional PR roles like crisis management, media and stakeholder relations, marketing communications amongst others (Helsby, 2010). For example during crisis management, PR practitioners can advise the management as well as actively participate in the utilization of new media like the organization’s website to communicate with both the organization’s publics and stakeholders. In so doing they will not only be performing their traditional role of crisis management but they will also be incorporating new technology in the performance of this role. This notion is supported by Taylor and Kent (2007, p.146) who points out that some forms of new media like websites provide a one-way means of communication which the organization can exploit them to convey i nformation to its publics and stakeholders and thus dispel any fears especially during times of crisis. Conclusion In conclusion therefore, new technologies have provided innumerable opportunities for PR practitioners to enhance their functions. However, the effective application of PR theoretical frameworks to new media and acquisition of appropriate skills and knowledge in new media to facilitate its effective utilization which must be done in the absence of funding, time and support are merely the tip of the ice-berg when it comes to the challenges PR practitioners are facing in their quest to fully capitalize on new media. Other factors pausing significant challenges to PR practioners include providing both publics and stakeholders with continuous and spontaneous access to information using the media of their choice, the establishing of meaningful functional relationships with the management of organizations as well as IT departments so as to ensure that they have the authority and resources necessary to provide instant content access to stakeholders and finally redefining the scope of PR pra ctice to embrace new media while still delivering on their traditional PR roles. References Dewdney, A. Ride, P. (2006). The New Media Handbook. New York: Routledge. Galloway, C. (2005). Cyber-PR and ‘dynamic touch’, Public Relations Review, 31, 572–577. Helsby, W. (2010).Digital communications and social media: The challenges facing the PR industry. Retrieved from http://www.prca.org.uk/default.asp?sid=8pid=442 Hessink, H., Bollen, L Steggink, M. (2007). Symmetrical versus asymmetrical company-investor communications via the internet. Corporate Communications: An International Journal, 12, 145–160. James, M. (2008). A review of the impact of new media on public relations: Challenges for terrain, practice and education. Asia Pacific Public Relations Journal, 8, 137-148. McAllister, S. Taylor, M. (2007). Community college web sites as tools for fostering dialogue. Public Relations Review, 33, 230–232. Nowland, P. (2006). PR Trends: A press release for social media. Entrepreneur. com. Retrieved from http://www.entrepreneur.com/marketing/publicrelations/prcolumnistmarknowlan/article170552.html. Porter, L. Sallot, L. (2003). The Internet and public relations: Investigating practitioners’ roles and World Wide Web use. Journalism and Mass Communications Quarterly, 80, 603–622. Stephens, M. (2007). Beyond News. Columbia Journalism Review, 45, 34–39. Taylor, M., Kent, M. (2007). Taxonomy of mediated crisis responses. Public Relations Review, 33, 140–146.

The importance of the Capital Market - Free Essay Example

Sample details Pages: 9 Words: 2836 Downloads: 6 Date added: 2017/06/26 Category Finance Essay Type Compare and contrast essay Did you like this example? Capital market is like an investment funds such as bonds, equities and mortgages are traded in the market. Then, capital market can be defined as a market of securities or equities or debt, where a company as well as government can raise a long-term fund. The market of money is provided longer than a year. Don’t waste time! Our writers will create an original "The importance of the Capital Market" essay for you Create order If it is the raising of short term funds, then it will be taking place on other markets that is money market. In this assignment, we are given the title of Asian Market Capital. There are many countries of Asian, so we have chosen few countries to further details on it. There countries include Japan, Indonesia as well as Hong Kong. Among the countries, we have gone further deeper on the country from Japan about their background as well as history. We would further search for the information on the market capital happen in Japan. Moreover, we going to compare the different investor will be having in market capital field. In addition, we will be discussing the advantages and disadvantages of going initial public offering for a firm. The example and details of cases will be further explained in this assignment. Background In this assignment, we will be discussing about the Asians capital market. Among the countries, we choose to go in deep about the capital market in Japan. In Japan, the Japanese venture capital funds managers always to select either direct managerial monitoring or portfolio diversification to manage their firms investment risks (Gorman and Sahlam, 1989). However, in recent years of 2004, JVCs have used a mix of different strategies, including direct managerial monitoring. This change in industry practice provides an opportunity to test the applicability of agency theory in the JVC industry. There will be some background history about market capital happened in Japan in the past years. The graph above shown that the increase of land in Japan has affected the stock price. The price of the land goes to the peak in the year of 1991. However, the peak area for the stocks price is in the year between 1989 and 1990. Moreover, the both prices started to fell when the year of 2000, an d it is affected to both prices of land as well as stocks. This shown that the total loan outstanding and real estate loans outstanding held by all Japanese banks in year 1980 to 2000. From the year 1980 to 1990, the both total of loans and real estate loans increased substantially. When the total loans levelled off in year 1990, the real estate loans is continued to increase until the year 1998. Furthermore, there were a happened that Japan faced problem in the year of 1998 that bank failure resulted from excessive real estate lending. For example, the company of Nippon Credit Bank, there were only 25% real estate loan comprised up of the total loans, and it was failed in 1998.( Kentaro Iwatsubo, 2005) Literature Review There are many countries in Asian, and in this assignment we have choose few countries as comparison. That is Japan, Indonesia, Hong Kong and Vietnam about their countrys capital market. JAPAN The business firms from Japan have relationships with commercial main banks. The main banks may hold the equity interests in their credit clients in turn, including investment banks. We study the impact of the relationships between firms, main banks as well as investment banks in Japans initial public offering (IPO) underwriting market. By issuing firms can choose whether to engage an investment bank that is related, by virtue of sharing the same main bank, or to engage a non-related investment bank. There are one of the literature concerns on the effects of banking relationships on access to credit and the cost of raising capital. First, the banking relationships and access to credit according to Stiglitz and Weiss (1981) observe that market frictions related information asymmetry can restrict the flow of the capital to investments. However, Petersen and Rajan (1994) hypothesize that by producing information about firms and using the information in their decisions can be partia lly solving the problem of market friction to the creditors. There are small effect on the cost of credit if ties with creditors, but the available of credits financing is more for firms with ties. Secondly, there are the concerns about commercial bank integration into investment banking. Based on Rajan (1992) models the borrowers choice between informed bank debt and arms length public debt as an aspect of the firms effort to offset the benefits of the related lenders ongoing monitoring against the lenders bargaining power. If banking relationships yield information advantages, then integration of commercial banking and investment banking may enhance a lenders bargaining power. In addition, a lender that is integrated is faced with a conflict of interest, in that the proceeds of capital market financing may be used inappropriately to extinguish risky bank debt. Thirdly, the concern about choice of organizational structure. It is given the tension between information cost savi ngs and conflict of interest, the structure of banking organizations can be expected to reflect efforts to realize information cost savings while lessen the conflicts. From Kroszner and Rajan (1997), he use pre-Glass-Steagall data to investigate that how integration affects issue of quality and pricing. They have concluded that market pressures induced commercial bank to address conflicts by choosing levels of integration into investment banking thats is separately incorporated affiliates versus integrated investment banking departments. Indonesia According to Fisman, (2001), the valuable resources for many firms are political connections, however, the connections impact firms strategies and their long-run financial performance are only a handful of studies that document (Faccio, 2002; Johnson and Mitton, 2003). The study shows that the consequences of political ties are a particular interest because these ties are often inconsistent with other value-creating business strategies. By taking the benefit at face value, it is difficult to understand why only a minority of companies access foreign capital markets. Domestic opportunities significantly reduce the net benefits of foreign securities for some firms are a core idea. For instance, the firm with political ties often receive low price loan from state-owned banks (Faccio, 2002; Wiwattanakantang et al., 2006), so they do not need to tap into foreign capital markets. It is also possible that global financing imposes extra costs on closely connected firms because the decision to cross-list shares on foreign exchanges often forces firms to adapt to the regulations that govern these markets (Coffee, 2002; Reese and Weisbach, 2002; Siegel, 2005). If only minority of shareholders are better protected abroad, then the foreign securities issue will becoming expensive for controlling owners accustomed to exploiting domestic investors. Equally, the international business press and foreign analysts will only pay attention on the firms with foreign securities (Baker et al., 2002; Lang et al., 2003). However, the political favours that often dubious legality is difficult to be reconciled by the high levels of public scrutiny. Hong Kong Steen, P. Carey (2006) said that the relationship between hot issues markets and under pricing is well documented in IPO literature. Hot issues markets are characterized by a large number of offerings, concentration of new issues in particular industries, preponderance of smaller issues, frequent over subscription and abnormally high initial returns, Ibbotson and Jaffe (1975). Steen, P. Carey (2006) wrote that Hong Kong IPO market given the size and importance of Hong Kong Stock Exchange (HKSE). That is Hong Kong Stock Exchange Market play an important role in the economy in Hong Kong. We can see Hong Kong economy by viewing it stock exchange market; by this we can also know the capital of the country. Several market conditions have been considered in the context of examining initial under pricing within the papers that have been written. Dawson and Hiraki (1985) in their research of the Hong Kong IPO market between 1979 and 1984 note that under pricing appeared to be superior d uring growing markets than declining markets. Steen. P. Carey (2006) state that their study predates the unification of the four Hong Kong stock exchanges in April 1986 into one central exchange (HKSE). McGuinness (1992), find out that the Hong Kong IPO market from year 1980 to 1986 that reports under pricing was completely linked with the state of market giving support to the suggestion of Beatty and Ritter (1986) that under pricing increases during the raising market period and decreases during the diminishing markets. In the stage of under assessment, Asian financial markets suffered one of the most severe and protected reversals of the post war period. Steen, P. Carey (2006). The collision of market situation on IPO under pricing was likely moderated in Hong Kong by the fundamental stability and formation of financial system. Miller (1998 p.277) said that Hong Kong was able to avoid devaluation because it has a monetary and foreign exchange system that is fundamentally differ ent from that of the rest of Southeast Asia. Hong Kong has a exchange board but no central bank, and as Miller show that the resident of Hong Kong have the confidence in the exchange board. An additional resource of potency is that the financial stability and transparency of Hong Kong companies had extensively privileged interest coverage and return on equity than those in other Asian countries. Jaggi (1997) also found out that the performance and strength of Hong Kong companies is consistent because the company used the company information to monitor it. In year 1997 there is a financial crisis occurred in Hong Kong when Hong Kong is beyond dispute. Chowdry and Goyal (2000) propose that the characteristic to define a country that experiences financial crisis will face a huge falling in its traded equity prices. In general, research investigating the impact of market condition on IPO underpricing has a well defined event which is recognized with the conversion from hot to cold. S teen, P. Carey (2006), found out that the year 1997 provides a unique measurement challenge as two significant events affected Hong Kong in that year; the 27 October stock market correction and the political return of Hong Kong to Chinese rule on June 30. When the Hong Kong is tender to Chinese, this historical event has a huge impact on Hong Kong Stock Exchange. The political handover was an exclusive event and many people celebrate for it, it was connected with a period of hesitation and was followed soon after by the October 27 stock market correction. This uncertainty happens because the investor is unsure about the post handover economic and monetary performance of Hong Kong. Sub theory In capital market, there will be variety of investors for a company or firms who are wanted to expand their business. Moreover, there are some of the firms who need the investors not because to expand their business, but also to support their businesses start up. Angel Investor Individual investors who buy equity in small private firms are called angel investors. Mostly, the first round of outside private equity financing is often obtained from angels. These investors included friends or acquaintances of the entrepreneur. The business receives a sizeable equity share for their funds because their capital investment is often large relative to the amount of capital already in place at the firm. Thus, these investors may have substantial influence in the business decisions of the firm. Besides that, angels may also bring expertise to firm that the entrepreneur lacks. There is a difficulty on finding angels since it is a function how well a firm connected the entrepreneur is in the local community. Venture Capital Firms Venture capital is a limited partnership specializes in raising money to invest in the private equity of young firms. Moreover, venture capitalist is defined as a person or investment firms that makes venture investment. Besides that, they are also expected to bring managerial and technical expertise and capital to their investment. Furthermore, venture capital is fascinated to the fresh company with the limited operating history which is too small to raise capital to the public market. This is because they are yet to reach the levels that are able to secure a bank loan as well as debt offering. The differentiation between Angel Investor and Venture Capital There are different between angel investor and venture capital. Angel investors are always the provider of risk capital to the small or private firms. In addition, the providers are not from the intermediary of other company, but they are wealth people. Moreover, angels are always as the second round of financing start-up goes through, before the firm looks for venture capital partnership, but it is after they has exhausted of all their family and friends money. On the other hand, venture capital is the investors who invest their capital to a firm as part of the companys partners. So, the company will be the part of the partnership, and they are allowed to vote and make decision. Then, angels investors are only waiting for the return earns from company to them, and they are never go learn deeper to the company. Furthermore, they are not vote or make decision as part of the firm they had invested. However, the venture investors will be planning and finding the way on how much their investment will earn them the amount of returns. Initial Public Offering (IPO) IPOÂÂ  is an acronym for InitialÂÂ  Public Offering. An IPO is the first sale of shares in a company to the public. When IPO occurs, a company will be listed in Bursa Malaysia, and shares will begin to trade immediately. The IPO market goes in cycles depending upon the appetite of investors for new issues. Often the share price will increase quickly after an IPO, so purchasing shares at the IPO price may be a covetedÂÂ  investmentÂÂ  opportunity. When management says it plans to take a company public, it means that an eventual IPO is planned. A successful IPO can raiseÂÂ  a large amount of capital for the newlyÂÂ  public companyÂÂ  and create substantial wealth for insiders who owned shares prior to the IPO. The differences between public and private is that public company can offer its stock to the public in huge amount, while private company is restricted to only friends and family members. Going public is important for those company which wa nt to raise their capital. There are some pro and cons for going public. The Advantages of an Initial Public Offering (IPO) The public offering increased the company stock and value this is so call increased in capitalization of the business. The stock can be used for various activities for instance: currency for mergers and acquisitions, as stock option to help maintain key personnel, they may also sell their shares in the open market. The company will have the better access to the stock markets for future capital inflow. In general terms, the companys valuation and debt to equity ratio will perk up after going public. Company is able to receive much better terms from lenders. The company which going public is easier to promote compare to the company that are private. We can view the achievement of the public company in Bursa Malaysia and thus it had a higher recognition than private company. This benefit raises the public relation images and identifies the stability of a public company. IPO can provide the company with a chance to implement share options schemes for its workforce. This scheme is competent to enhance employee morale, maintain the loyalty of staff to company, and catch the attention of first rate employees. In long term, this can raise the employees productivity and increase the profitability of a company. The Disadvantages of an Initial Public Offering (IPO) For a company which going public need higher reporting requirements, it means further obligations and reporting requirements as public companies have to fulfill the range of regulatory necessities and meet accepted standards of corporate governance. For example, listed companies need an auditor to audit their account and report the financial statement and publish the annual report in the Bursa Malaysia. As the annual report is going to publish in the Bursa Malaysia annually, the company is said to be losing it privacy. The company needs to disclose the report honestly to the public. They cannot hide any details regarding stock option plans, details of lease agreements, gross profit, net income and its borrowing. The others disadvantages is when a company go public, they have to offer the shares to the public or in other word which means that the business owners will have to share it ownership with other investor, and shareholders can affect the company operations; they can vo ice out their opinion and decisions. Conclusion As a conclusion, each country has different experience about the economic growth and the capital markets. Every country applies different style, for Hong Kong they do not have central bank and for Japan they have many commercial banks that they call as main bank. The capital market of the country can be view by the venture capital in the market or the listed company in the stock exchange market. The listed company in the stock exchange market show that the investment of the public to the achievement of the capital market in the country. It reveals how much wealth the country has and how good was the economics of the country.

Enterperneurship and Notes Free Essays

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Entrepreneurship—MGT602 VU Table of Contents Lesson No. Title / Topic 1 Introduction 2 The Nature and Importance of Entrepreneurship 3 Entrepreneurial Process/ Start up 4 The Entrepreneurial and Intrapreneurial Mind 5 The Entrepreneurial and Intrapreneurial Mind (Contd†¦ ) 6 The Entrepreneurial and Intrapreneurial Mind (Contd†¦ ) 7 The Entrepreneurial and Intrapreneurial Mind (Contd†¦ ) 8 The Individual Entrepreneur 9 The Individual Entrepreneur (Contd†¦ ) 10 The Individual Entrepreneur (Contd†¦ 11 International Entrepreneurial Opportunities 12 International Entrepreneurial Opportunities 13 International Entrepreneurial Opportunities (Contd†¦ ) 14 International Entrepreneurial Opportunities (Contd†¦ ) 15 International Entrepreneurial Opportunities (Contd†¦ ) 16 Creativity and Business Idea 17 Creativity and the Business Idea 18 Legal Issues for the Entrepreneur 19 Legal Issues for Entrepreneur (Contd†¦ ) 20 Legal Issues for the Entr epreneur (Contd†¦ ) 21 Creating and Starting the Venture 22 Creating and Starting the Business Venture (Contd†¦ 23 Creating and Starting the Venture (Continued) 24 Creating and Starting the Business Plan Continued) 25 The Marketing Plan 26 The Marketing Mix 27 The Organizational Plan 28 The Organizational Plan (Continued) 29 The Organization Plan (Contd†¦ ) 30 The Financial Plan 31 The Financial Plan (Continued†¦ ) 32 Pro Forma Sources and Uses of Funds 33 Pro forma Sources and Uses of Funds 34 Bank Lending Decision 35 Sources of Capital 36 Sources of Capital (Contd†¦ ) 37 Capital Sources in Pakistan Preparing for the New Venture Launch: Early Management Decisions 38 (Contd†¦ ) Page No. 3 06 08 13 15 18 20 22 24 26 29 33 35 37 39 40 43 46 49 52 54 56 58 60 62 65 68 70 72 75 77 81 83 85 87 89 91 95  © Copyright Virtual University of Pakistan 1 Entrepreneurship—MGT602 VU 39 Preparing for the New Venture Launch: Early Management Decisions (Contdâ € ¦ ) 40 Preparing for the New Venture Launch: Early Management Decisions (Contd†¦ ) 41 Preparing for the New Venture Launch: Early Management Decisions (Contd†¦ ) 96 97 99 42 Preparing for the New Venture Launch: Early Management Decisions (Contd†¦ ) 43 New Venture Expansion Strategies and Issues 44 New Venture Expansion Strategies and Issues (Contd†¦ 45 Entrepreneurship and Pakistan 102 103 105 108  © Copyright Virtual University of Pakistan 2 Entrepreneurship—MGT602 INTRODUCTION Lesson 01 LEARNING OBJECTIVES 1. We will write a custom essay sample on Enterperneurship and Notes or any similar topic only for you Order Now 2. 3. 4. 5. VU 1. To introduce the concept of entrepreneurship and its historical development. 2. To explain the entrepreneurial decision process. 3. To identify the basic types of start-up ventures. 4. To explain the role of entrepreneurship in economic development. 5. To discuss the ethics and racial responsibility of entrepreneurs. NATURE AND DEVELOPMENT OF ENTREPRENEURSHIP The term entrepreneur comes from the French and translates â€Å"between-taker† or go-between. † Earliest Period In this period the money person (forerunner of the capitalist) entered into a contract with the go-between to sell his goods. While the capitalist was a passive risk bearer, the merchant bore all the physical and emotional risks. Middle Ages In this age the term entrepreneur was used to describe both an actor and a person who managed large production projects. In such large production projects, this person did not take any risks, managing the project with the resources provided. A typic al entrepreneur was the cleric who managed architectural projects. 7th Century In the 17th century the entrepreneur was a person who entered into a contract with the government to perform a service Richard Cantillon, a noted economist of the 1700s, developed theories of the entrepreneur and is regarded as the founder of the term. He viewed the entrepreneur as a risk taker who â€Å"buy[s] at certain price and sell[s] at an uncertain price, therefore operating at a risk. † 18th Century In the 18th century the person with capital was differentiated from the one who needed capital. In other words, entrepreneur was distinguished from the capital provider. Many of the inventions developed during this time as was the case with the inventions of Eli Whitney and Thomas Edison were unable to finance invention themselves. Both were capital users (entrepreneurs), not capital providers (venture capitalists. ) Whitney used expropriated crown property. Edison raised capital from private sources. A venture capitalist is a professional money manager who makes risk investments from a pool of equity capital to obtain a high rate of return on investments. 19th and 20th Centuries In the late 19th and early 20th centuries, entrepreneurs were viewed mostly from an economic perspective. The entrepreneur â€Å"contributes his own initiative, skill and ingenuity in planning, organizing and administering the enterprise, assuming the chance of loss and gain. † Andrew Carnegie is one of the best examples of this definition, building the American steel industry on of the wonders of industrial world, primarily through his competitiveness rather than creativity. In the middle of the 20th century, the notion of an entrepreneur as an innovator was established.  © Copyright Virtual University of Pakistan 3 Entrepreneurship—MGT602 Innovation, the act of introducing something new, is one of the most difficult tasks for the entrepreneur. VU Edward Harriman and John Pierpont Morgan are examples of this type of entrepreneur. Edward reorganized the Ontario and southern railroad through the northern pacific trust and john developed his large banking house by reorganizing and financing the nation’s industries. This ability to innovate is an instinct that distinguishes human beings from other creatures and can be observed throughout history. DEFINITION OF ENTREPRENEUR The concept of entrepreneurship from a personal perspective has been explored in this century. This exploration is reflected in the following three definitions of an entrepreneur: In almost all definitions of entrepreneurship, there is agreement that we are talking about a kind of behavior that includes: 1. Initiative taking 2. The organizing and reorganizing or social/economic mechanisms to turn resources and situations to practical account. 3. The acceptance of risk or failure. To an economist, an entrepreneur is one who brings resources, labor, materials, and other assets into combinations that make their value greater than before, and one who introduces changes, innovations, and a new order. To a psychologist, such a person is typically driven by certain forces- the need to obtain something, to experiment, to accomplish or perhaps to escape the authority of others. Entrepreneurship is the dynamic process of creating incremental wealth. Our definition of entrepreneurship involves four aspects: 1. You read "Enterperneurship and Notes" in category "Papers" Entrepreneurship involves the creation process. 2. It requires the devotion of the necessary time and effort. 3. It involves assuming the necessary risks. 4. The rewards of being an entrepreneur are independence, personal satisfaction, and monetary reward. For the person who actually starts his or her own business there is a high failure rate due to poor sales, intense competition, lack of capital or lack of managerial ability. THE ENTR EPRENEURIAL DECISION PROCESS (Deciding to become an entrepreneur by leaving present activity ) Many individuals have difficulty bringing their ideas to the market and creating new venture entrepreneurship and the actual entrepreneurial decisions have resulted in several million new businesses being started throughout the world. Although no one knows the exact number in the United States. Indeed, millions of ventures are formed despite recession, inflation, high interest rates, and lack of infrastructure, economic uncertainty and the high probability of failure The entrepreneurial decision process entails a movement from something to something— a movement from a present life style to forming a new enterprise. To leave a present live-style to create something new comes from a negative force–disruption. Many companies are formed by people who have retired, moved, or been fired. Another cause of disruption  © Copyright Virtual University of Pakistan 4 Entrepreneurship—MGT602 is completing an educational degree. The decision to start a new company occurs when an individual perceives that forming a new enterprise is both desirable and possible. VU KEY TERMS Breakthrough innovations A new product with some technological change Business ethics The study of behavior and morals in a business situation Desirability of new venture formation Aspects of a situation that make it desirable to start a new company. Entrepreneur Individual who takes risks and starts something new Entrepreneur as an innovator An individual developing something unique Entrepreneurial decision process Deciding to become an entrepreneur by leaving present activity Entrepreneurship Process of creating something new and assuming the risks and rewards  © Copyright Virtual University of Pakistan 5 Entrepreneurship—MGT602 THE NATURE AND IMPORTANCE OF ENTREPRENEURSHIP Lesson 02 VU LEARNING OBJECTIVES 1. To introduce the concept of entrepreneurship and its historical development. . To explain the entrepreneurial decision process. Desirability of New Venture Formation (Aspects of a situation that make it desirable to start a new company) The perception that starting a new company is desirable results from an individual’s culture, subculture, family, teachers and peers. American culture places a high value on being your own boss, being a success and making money therefore, it is not surprising to find a high rate of company formation in the United States. On the other hand in some countries making money is not as valued and failure may be a disgrace. The rate of business formation in these countries is not as high. Many subcultures that shape value systems operate within a cultural framework. Studies indicate that a high percentage of founders of companies had fathers and/or mothers who valued independence. Encouragement to form a company is also gained from teachers, who can significantly influence individuals. An area having a strong educational base is also a requirement for entrepreneurial activity. Peers are important, also, as is an area with an entrepreneurial pool and peer-meeting place. Possibility of New Venture Formation (Factors making it possible to create a new venture) Although the desire of new venture formation derived from the individual’s culture, subculture, family, teachers and peers needs to be present before any action is taken, the second feature necessary centers around this question â€Å"What makes it possible to form a new company? † Formal education nd previous business experience give a potential entrepreneur the skills needed to form and manage a new enterprise. Although educational systems are important in providing the needed business knowledge, individual will tend to be more successful in forming in fields in which they have worked. The government also contributes by providing the infrastructure to help a new venture. The market must be large enough and the entrepreneur must have the marketing know-how to put together the entire packa ge. Finally, financial resources must be readily available. Although most start-up money comes from personal savings, credit, and friends, but there is often a need for additional capital. Riskcapital availability plays an essential role in the development and growth of entrepreneurial activity.  © Copyright Virtual University of Pakistan 6 Entrepreneurship—MGT602 VU KEY TERMS Foundation companies A type of company formed from research and development that usually does not go public. Gazelles Very high growth ventures. Government as an innovator A government active in commercializing technology High-potential ventures. A venture that has high growth potential and therefore receives great investor interest Entrepreneurship Entrepreneurship within an existing business structure Iterative synthesis The intersection of knowledge and social need that starts the product development process Lifestyle firm A small venture that supports the owners and usually does not grow Ordinary innovation Z new product with little technological change Possibility of new venture formation Factors making it possible to create a new venture Copyright Virtual University of Pakistan 7 Entrepreneurship—MGT602 ENTREPRENEURIAL PROCESS/START UPS Lesson 03 LEARNING OBJECTIVES 1. To identify the basic types of start-up ventures. 2. To explain the role of entrepreneurship in economic development 3. To discuss the ethics and racial responsibility of TYPES OF START-UPS Life-Style Firms A life-style firm exists primarily to support the owners and usually has little growth opportunity. This type of firm may grow after several years to 30 or 40 employees. Foundation Companies VU A type of company formed from research and development that usually does not go public. This firm can grow in five to ten years from 40 to 400 employees. High-Potential Venture A venture has high growth potential and therefore receives great investor interest. The company may start out like a foundation company, but its growth is far more rapid. After five to ten years the company could employ around 500 employees. These firms are also called gazelles and are most important for the economic development of an area ROLE OF ENTREPRENEURSHIP IN ECONOMIC DEVELOPMENT The role of entrepreneurship in economic development involves initiating change in the structure of business and society. One theory of economic growth depicts innovation as the key, not only in developing new products, but also in stimulating investment interest. The new capital created expands the capacity for growth (supply side), and new spending utilizes the new capacity and output (demand side. In spite of the importance of investment and innovation in the economic development of an area, there is still a lack of understanding of few factors which are as follows: †¢ The product-evolution process is the process through which innovation develops and commercializes through entrepreneurial activity, which in turn stimulates economic growth. It begins with knowledge in the base technology and ends with products or services availabl e in the marketplace. †¢ The critical point in the process is the intersection of knowledge and a recognized social need, called the iterative synthesis. This point often fails to evolve into a marketable innovation. Most innovations introduced in the market are ordinary innovations, with little uniqueness. Technological innovations refer to new products with significant technological advancements. †¢ †¢ †¢ Breakthrough innovations mean the development of new products with some technological change. Regardless of the level of uniqueness or technology, each innovation evolves into and develops towards commercialization through one of three mechanisms: the government, entrepreneurship, or entrepreneurship. Entrepreneurship has assisted in revitalizing areas of the  © Copyright Virtual University of Pakistan 8 Entrepreneurship—MGT602 VU inner city. Individuals in inner-city areas can relate to the concept and see it as a possibility for changing their present situation. GOVERNMENT AS AN INNOVATOR A government active in commercializing technology is known as an innovative government. Commercializing technology is frequently called technology transfer. However, few inventions resulting from government-sponsored research have reached the commercial market. Most of the by-products from scientific research have little application to any social need. The government lacks the business skills needed for successful commercialization. Government bureaucracy and red tape also often inhibit the timely formation of the business. Recently, federal labs have been required to commercialize some of their technology each year and some are providing entrepreneurial training Intrapreneurship Intrapreneurship refers to entrepreneurship within an existing organization or business structure. Existing businesses have the financial resources, business skills, and arketing and distribution system to commercialize innovation successfully. Often the bureaucratic structure, emphasis on short-term profits, and structured organization inhibit creativity. Some corporations have tried to establish an Entrepreneurial spirit in their organization, some in the form of strategic business units (SBUs. ) Intrapreneurship can also bridge the gap between science and the ma rketplace. It is the practice of using entrepreneurial skills without taking on the risks or accountability associated with entrepreneurial activities. It is practiced by employees within an established organization using a systemized business model. Employees, perhaps engaged in a special project within a larger firm are supposed to behave as entrepreneurs, even though they have the resources and capabilities of the larger firm to draw upon. Capturing the dynamic nature of entrepreneurial management (trying things until successful, learning from failures, attempting to conserve resources, etc. ) adds to the potential of otherwise static organizations without exposing those employees or self mployed people to the risks or accountability normally associated with entrepreneurial failure. Employee Intrapreneur An employee Intrapreneur is the person who focuses on innovation and creativity and who transforms a dream or an idea into a profitable venture, by operating within the organizational environment. Thus, Intrapreneurs are inside entrepreneurs who follow the goal of the organization. Employees, perhaps engaged in a special project within a larger firm are supposed to behave as entrepreneurs, even though they have the resources, capabilities and security of the larger firm to draw upon. Capturing a little of the dynamic nature of entrepreneurial management (trying things until successful, learning from failures, attempting to conserve resources, etc. ) adds to the potential of an otherwise static organizations without exposing those employees to the risks or accountability normally associated with entrepreneurial failure Entrepreneurship The third method for bridging the gap between the science and the marketplace is via  © Copyright Virtual University of Pakistan 9 Entrepreneurship—MGT602 VU entrepreneurship. Many entrepreneurs have difficult time bridging this gap and creating new ventures. They may often lack managerial skills, marketing capabilities, or financial resources. They frequently do not know how to interface with banks, suppliers, customers, and distributors. Yet, entrepreneurship is the most effective method for bridging the gap and creating new enterprises, these activities affect an areas economy by building the economic base and providing jobs. ENTREPRENEURIAL CAREERS AND EDUCATION Since 1985 there has been an increased interest in entrepreneurial careers fostered by factors such as increased media coverage of entrepreneurs and employment shifts. A conceptual model for understanding entrepreneurial careers views the career stages as interacting with other stages and events in the individual’s life, the life-cycle approach. This approach conceptualizes entrepreneurial careers in nine categories. 1. Educational environment 2. The individual’s personality 3. Childhood family environment 4. Employment history 5. Adult development history 6. Adult family/non-work history 7. Current work situation 8. The individual’s current perspective 9. The current family situation Although there exist a common perception that entrepreneur are less educated than the general population however studies have found entrepreneurs overall and female entrepreneurs in particular, are far more educated than the general population. However, this education sometimes does not develop the specific skills needed in the venture, especially for women entrepreneurs. Childhood influences have been explored, particularly in terms of values and the individual’s personality . The traits most frequently researched are the need for achievement, locus of control, risk-taking, and gender identity. The research on the childhood family environment of the entrepreneur has had more definite results. Entrepreneurs tend to have self-employed fathers, and many also have entrepreneurial mothers. The family plays an important role in establishing the desirability of entrepreneurship as a career. Employment history also has an impact on entrepreneur careers in both positive and a negative sense. Entrepreneurs tend to have a higher probability of success when the venture created is in their field of experience. Negative displacement (such as dissatisfaction with various aspects of ones job) also encourages entrepreneurship. Although no definite research has been done on the adult development history of entrepreneurs, it appears to also affect entrepreneur’s careers. One’s development history has somewhat more of an impact on women, since they tend to start businesses at a later stage in life. There is a lack of data on adult family/non-work history and the available data adds little understanding towards entrepreneurial career development. Entrepreneurs are known for their strong work values, their long workdays, and their dominant management style. They tend to fall in love with the organization and will sacrifice almost Copyright Virtual University of Pakistan 10 Entrepreneurship—MGT602 VU anything in order for it to survive. While in college, few future entrepreneurs realize that they will pursue entrepreneurship as their major life goal. Relatively few individuals will start a business immediately after graduation. Entrepreneurship education is a fast growing area in colleges an d universities. While the courses vary by university, there is a great commonality, especially in the initial few courses. The skills required by entrepreneurs can be classified in to three main areas: 1. Technical skills involve such things as writing, listening, oral presentations, coaching, and technical know-how. 2. Business management skills include those areas involved in starting, developing and managing any enterprise. 3. Personal entrepreneurial skills differentiate an entrepreneur from a manager and include inner control (discipline), risk taking, innovativeness, persistence, visionary leadership, and being change oriented. These skills and objectives form the basis of the modular approach to an entrepreneurship curriculum. Today entrepreneurs are recognizing the need to learn some of the science of management in an MBA program in order to grow their businesses effectively in the global environment. ETHICS AND SOCIAL RESPONSIBILITY OF ENTREPRENEURS The entrepreneur must establish a balance between ethical exigencies, economic expediency, and social responsibility. A managers attitudes concerning corporate responsibility tend to be supportive of laws and professional codes of ethics. Entrepreneurs have few reference persons, role models, and developed internal ethics codes. Entrepreneurs are sensitive to peers pressure and social norms in the community as well as pressures from their companies. While ethics refers to the â€Å"study of whatever is right and good for humans,† business ethics concerns itself with the investigation of business practices in light of human values. The word â€Å"ethics† stems from the Greek ethos, meaning custom and usage. Development of Our Ethical Concepts Socrates, Plato, and Aristotle provide the earliest writings dealing with ethical conceptions; earlier writings involving moral codes can be found in both Judaism and Hinduism. American attitudes on ethics result from three principle influences: Judeo-Christian heritage, a belief in individualism and opportunities based on ability rather than social status. Research on business ethics can be broken down into four broad classifications: 1. Pedagogically-oriented inquiry 2. Theory-building without empirical testing 3. Empirical research, measuring the attitudes and ethical beliefs of students and academic faculty 4. Empirical research within business environments THE FUTURE OF ENTREPRENE URSHIP In spite of the differences in definition of entrepreneurship, there are common aspects such as risk taking, creativity, independence, and rewards. Entrepreneurship is currently being embraced by educational institutions, governments, societies, and corporations. Schools are increasing their emphasis on entrepreneurship in terms of courses and academic research. In Europe many universities have started programs in entrepreneurship. There has also been an increase in academic research, endowed chairs and centers of Copyright Virtual University of Pakistan 11 Entrepreneurship—MGT602 VU entrepreneurial activity. Governments have also promoted the growth of entrepreneurship. Individuals are encouraged to form new businesses and provided tax incentives, roads, and a communications system to facilitate this creative process. Some state governments are developing strategies for fostering entrepreneurial a ctivity. The venture capital industry has benefited from lowering of capital gains tax rates and more relaxed rules regarding pension fund investment. Society’s support of entrepreneurship is critical in providing motivation and public support. The media has played a powerful role in developing public support. Media coverage uplifts the image of the entrepreneur and growth companies. Articles have appeared in newspapers such as New York Times, The Wall Street Journal, and the Washington Post. Business magazines such as Barrons, Business Week, Forbes, and Fortune have provided coverage. Magazines such as Black Enterprise, Entrepreneur, Inc. , and Venture focus on issues of the entrepreneurial process. Television on both a national and local level has highlighted entrepreneurship. Large companies will continue to have a special interest in Entrepreneurship in the future. The largest 15 companies account for over 20 percent of the total U. S. research and development. Other companies will create more new businesses through Entrepreneurship. KEY TERMS Product-evolution process Process for developing and commercializing an innovation Risk taking Taking calculated chances in creating and running a venture. Technological innovation A new product with significant technological advancement Technology transfer Commercializing the technology in the laboratories into new products  © Copyright Virtual University of Pakistan 12 Entrepreneurship—MGT602 THE ENTREPRENEURIAL AND INTRAPRENEURIAL MIND LEARNING OBJECTIV ES 1. To explain the aspects of the entrepreneurial process. 2. To explain the differences between entrepreneurial and managerial domains. 3. To explain the organizational environment conducive for entrepreneurship. 4. To identify the general characteristics of an Entrepreneur. 5. To explain the process of establishing entrepreneurship in an organization. VU Lesson 04 ENTREPR E NEURIAL PROCESS The entrepreneurial process involves finding, evaluating, and developing an opportunity by overcoming the strong forces that resist the creation of something new. Phase 1: Identifying and Evaluating the Opportunity Most good business opportunities result from an entrepreneur being alert to possibilities. Some sources are often fruitful, including consumers and business associates. Channel members of the distribution system-retailers, wholesalers or manufacturer’s reps-are also helpful. Technically-oriented individuals often identify business opportunities when working on other projects. Each opportunity must be carefully screened and evaluated-this is the most critical element of the entrepreneurial process. . The evaluation process involves looking at b. The creation and length of the opportunity c. Its real and perceived value d. Its risks and return. e. It’s fit with the skills and goals of the entrepreneur f. Its differential advantage in its competitive environment It is important to understand the cause of the opportunity, as the resulting opportunity may have a different market size and time dimension. The market size and the length of the window of opportunity are the primarily bases for determining risks and rewards. The risks reflect the market, competition, technology, and amount of capital involved. The amount of capital forms the basis for the return and rewards. The return and reward of the present opportunity needs to be viewed in light of any possible subsequent opportunities as well. The opportunity must fit the personal skills and goals of the entrepreneur. The entrepreneur must be able to put forth the necessary time and effort required for the venture to succeed. One must believe in the opportunity enough to make the necessary sacrifices. Opportunity analysis, or an opportunity assessment plan, should focus on the opportunity and provide the basis to make the decision, including: a. A description of the product or service b. An assessment of the opportunity c. Assessment of the entrepreneur and the team d. Specifications of all the activities and resources needed e. The source of capital to finance the initial venture The most difficult aspect of opportunity analysis is the assessment of the opportunity. Phase 2: Develop a Business Plan A good business plan must be developed in order to exploit the opportunity defined. A good business plan is important in developing the opportunity and in determining the resources required, obtaining those resources and successfully managing the venture.  © Copyright Virtual University of Pakistan 13 Entrepreneurship—MGT602 VU Phase 3: Determine the Resources Required. Assessing the resources needed starts with an appraisal of the entrepreneur’s present resources. Any resources that are critical must be distinguished from those that are just helpful. Care must be taken not to underestimate the amount and variety of resources needed. Acquiring needed resources, while giving up as little control as possible, is difficult. The entrepreneur should try to maintain as large an ownership position as possible, particularly in the start-up stage. As the business develops, more funds will probably be needed, requiring more ownership be relinquished. Alternative resource suppliers should be identified, along with their needs and desires, in order to structure a deal with the lowest cost and loss of control. Phase 4: Manage the Enterprise. The entrepreneur must employ these resources through implementation of the business plan. This involves implementing a management structure, as well as identifying a control system. KEY TERMS Administrative domain The ways managers make decisions Business plan The description of the future direction of the business Corporate culture The environment of a particular organization Entrepreneurial domain The ways entrepreneurs make decisions Entrepreneurial process The process through which a new venture is created by an entrepreneur Entrepreneurial culture The environment of an entrepreneurial-oriented organization Entrepreneurship Entrepreneurship within an existing business organization Opportunity identification The process by which an entrepreneur comes up with the opportunity for a new venture Opportunity parameters Barriers to new product creation and development Top management commitment Managers in an organization strongly supporting entrepreneurship Traditional managers Managers in a non-entrepreneurial-oriented organization Window of opportunity The time period available for creating the new venture  © Copyright Virtual University of Pakistan 14 Entrepre neurship—MGT602 VU THE ENTREPRENEURIAL AND INTRAPRENEURIAL MIND (continued†¦) Lesson 05 LEARNING OBJECTIVES 1. To explain the aspects of the entrepreneurial process. 2. To explain the differences between entrepreneurial and managerial domains. 3. To explain the organizational environment conducive for entrepreneurship. 4. To identify the general characteristics of an entrepreneur. 5. To explain the process of establishing entrepreneurship in an organization. MANAGERIAL VERSUS ENTREPRENEURIAL DECISION MAKING The difference between the entrepreneurial and managerial styles involves five business dimensions. Strategic Orientation The entrepreneur’s strategic orientation depends on his or her perception of the opportunity. This orientation is most important when other opportunities have diminishing returns accompanied by rapid changes in technology, consumer economies, social values or political rules. When the use of planning systems is the strategic orientation, there is more pressure for the administrative domain to be operant. Commitment to Opportunity The entrepreneurial domainis pressured by the need for action and has a short time span in terms of opportunity commitment. The administrative domain (the ways mangers make decisions) is not only slow to act on an opportunity, but the commitment is usually for a longer time span. Commitment of Resources An entrepreneur is used to having resources committed at periodic intervals, often based on certain tasks or objectives being reached. In acquiring these resources the entrepreneur is forced to achieve significant milestones using very few resources. In the administrative domain, the commitment of resources is for the total amount needed. Administrative-oriented individuals receive personal rewards by effectively administering the resources under their control. Control of Resources The administrator is rewarded by effective resource administration and has a drive to own or accumulate as many resources as possible. The entrepreneur, under pressure of limited resources, strives to rent resources on an as-needed basis. Managerial Structure In the administrative domain, the organizational structure is formalized and hierarchical in nature. The entrepreneur employs a flat organizational structure with informal networks. CAUSES FOR RECENT INTEREST IN INTRAPRENEURSHIP  © Copyright Virtual University of Pakistan 15 Entrepreneurship—MGT602 VU Interest in intrapreneurship has resulted from events occurring on social, cultural, and business levels. There is an increasing interest in â€Å"doing your own thing. † Individuals frequently desire to create something of their own. They want responsibility and want more freedom in their organizations. Frustration can develop and result in the employee becoming less productive or leaving the organization. This has recently caused more discontent in structured organizations. When meaning is not provided within the organization, individuals often search for an institution, such as entrepreneurship, that will provide it. Intrapreneurship is one method for stimulating and capitalizing on those who think that something can be done differently and better, such as Xerox Corporation’s commitment to Xerox Technology Ventures. It is important to instill the intrapreneurial spirit in an organization in order to innovate and grow. In a large organization problems occur that thwart creativity and innovation. This growth and diversity that can result are critical, since large corporations are more efficient in a competitive market than are smaller firms. The resistance against flexibility, growth, and diversification can be overcome by developing a spirit of entrepreneurship, called Intrapreneurship, within the existing organization. There are social, cultural, and business pressures for Entrepreneurship. Hyper competition has forced U. S. companies to focus on new product development and increased productivity. Reductions in large corporation’s staff are being absorbed in the workforce, particularly in small businesses. Entrepreneurial endeavors consist of four key elements. 1. New business venturing refers to the creation of new business within an existing organization. 2. Organizational innovativeness refers to product and service innovation with an emphasis on development and innovation in technology. 3. Self-renewal reflects the transformation of organizations through the renewal of the key ideas on which they are built. 4. Proactiveness includes initiative and risk taking, as well as competitive aggressiveness KEY TERMS Administrative domain The ways managers make decisions Business plan The description of the future direction of the business Corporate culture The environment of a particular organization Entrepreneurial domain The ways entrepreneurs make decisions Entrepreneurial process The process through which a new venture is created by an entrepreneur Entrepreneurial culture The environment of an entrepreneurial-oriented organization Entrepreneurship  © Copyright Virtual University of Pakistan 16 Entrepreneurship—MGT602 Entrepreneurship within an existing business organization Opportunity identification The process by which an entrepreneur comes up with the opportunity for a new venture Opportunity parameters Barriers to new product creation and development Top management commitment Managers in an organization strongly supporting Entrepreneurship Traditional managers Managers in a non-entrepreneurial-oriented organization Window of opportunity The time period available for creating the new venture VU  © Copyright Virtual University of Pakistan 17 Entrepreneurship—MGT602 VU THE ENTREPRENEURIAL AND INTRAPRENEURIAL MIND (continued†¦) Lesson 06 LEARNING OBJECTIVES 1. 2. 3. 4. 5. To explain the aspects of the entrepreneurial process. To explain the differences between entrepreneurial and managerial domains. To explain the organizational environment conducive for entrepreneurship. To identify the general characteristics of an entrepreneur. To explain the process of establishing entrepreneurs hip in an organization. CORPORATE VERSUS INTRAPRENEURIAL CULTURE Smaller, aggressive, entrepreneurial firms are developing more new products and becoming dominant in certain markets. Many companies are attempting to create the same spirit, culture, and rewards of entrepreneurship in their organizations. The typical corporate culture has a climate and reward system that favors conservative decision making. Emphasis is on gathering large amounts of data as the basis for a rational decision. Risky decisions are often postponed until hard facts are gathered or a consultant is hired. Often there are so many approvals required that no individual feels personally responsible for the project. The guiding principles in a traditional corporate culture are: 1. 2. 3. 4. 5. 6. Follow instructions given Do not make mistakes Do not fail Do not take initiative Stay within your turf and protect your backside This restrictive environment is not conducive to creativity, flexibility, and risk taking The guiding principles of intrapreneurs Aspects of an Entrepreneurial culture are quite different: 1. 2. 3. 4. 5. Develop visions, goals, and action plans Be rewarded for actions taken Suggest, try, and experiment Create and develop Take responsibility and ownership There are differences in the norms of the two cultures. The traditional culture is hierarchical in nature, with established procedures, lines of authority, and control mechanisms. These support the present corporate culture, and do not encourage new venture creation. The culture of an intrapreneurial firm has a flat organizational structure with networking, teamwork, sponsors, and mentors. Close working relationships help establish an atmosphere or trust that facilitates accomplishment of visions. Individuals make suggestions across functional areas, resulting in cross-fertilization of ideas. The two cultures produce different types of individuals and management styles.  © Copyright Virtual University of Pakistan 18 Entrepreneurship—MGT602 VU Motivation Traditional managers are motivated primarily by promotion and typical corporate rewards. Entrepreneurs and intrapreneurs thrive on independence and the ability to create. Intrapreneurs expect their performance to be suitably rewarded. There are also time orientation differences. Managers emphasize the short run, entrepreneurs the long run, and intrapreneurs somewhere in between. Intrapreneurs use a midpoint mode between delegation of managers and direct involvement of entrepreneurs. Entrepreneurs and intrapreneurs are moderate risk takers; managers are much more cautious. Most entrepreneurs fail at least once, and Intrapreneurs learn to conceal risky projects from management until the last possible moment. Traditional managers tend to be most concerned about those at higher levels, entrepreneurs serve self and customers, and intrapreneurs add sponsors. CLIMATE FOR INTRAPRENEURSHIP In establishing an Intrapreneurial environment, certain factors and leadership characteristics need to be present. The first of these is that the organization operates on the frontiers of technology. Since research and development are key sources for new product ideas, the firm must operate on the cutting edge of technology and encourage and supporting new ideas instead of discouraging them. Second is experimentation, or trial and error, is encouraged. Successful new products usually do not appear fully developed; instead they evolve. A company wanting to establish an intrapreneurial spirit has to establish an environment that allows mistakes and failures. Without the opportunity to fail, few corporate intrapreneurial ventures will be developed. Third an organization should make sure that there are no initial opportunity parameters, such as turf protection, inhibiting creativity in new product development. Fourth, the resources of the firm need to be available and easily accessible. Often, insufficient funds are allocated not to creating something new but instead to solving a problem that have an immediate effect on the bottom line. Some companies, such as Xerox, 3M, and ATT have established separate venture capital areas for funding new internal ventures. Fifth a multidisciplinary team approach needs to be encouraged. One key to Intrapreneurial success is the existence of â€Å"skunkworks† involving key people. Developing the needed team work for a new venture is further complicated by the fact that a team member’s promotion within the corporation is related to performance in the current position, not in the new venture. The corporate environment must establish a long time horizon for evaluating the success of the overall program. Sixth the spirit of intrapreneurship cannot be forced on individuals; it must be voluntary. Most managers in a corporation are not capable of being successful intrapreneurs. Those who do emerge from this self selection process must be allowed the latitude to carry a project through to completion. An intrapreneur falls in love with the new venture and will do almost anything to ensure its success. The seventh characteristic is a reward system. The intrapreneur needs to be appropriately rewarded for the energy and effort expended on the new venture. An equity position in the new venture is one of the best motivational methods. Eight a corporate environment favorable for intrapreneurship has sponsors and champions throughout the organization that supports the creative activity and resulting failures. Finally the intrapreneurial activity must be whole-heartedly supported by top management.  © Copyright Virtual University of Pakistan 19 Entrepreneurship—MGT602 VU THE ENTREPRENEURIAL AND INTRAPRENEURIAL MIND (continued†¦) Lesson 07 LEARNING OBJECTIVES 1. 2. 3. 4. 5. To explain the aspects of the entrepreneurial process. To explain the differences between entrepreneurial and managerial domains. To explain the organizational environment conducive for entrepreneurship. To identify the general characteristics of an Entrepreneur. To explain the process of establishing entrepreneurship in an organization. INTRAPRENEURIAL LEADERSHIP CHARACTERISTICS There are certain individual characteristics needed for a person to be successful Entrepreneurs, including: 1. Understanding the environment 2. Being visionary and flexible 3. Creating management options 4. Encourage teamwork while employing a multi-disciplined approach 5. Encouraging open discussion 6. Building a coalition of supporters, and persisting An Entrepreneur needs to understand all aspects of the environment. Part of this ability is reflected in individual’s level of creativity. Creativity tends to decrease with age and education. The individual must be creative and have a broad understanding of the internal and external environments of the corporation. The intrapreneurial person must be a visionary leader-a person who dreams great dreams. Leadership is the ability to dream great things and communicate them in a way that people say yes to being a part of the dream. To establish a successful new venture, the intrapreneurial leader must have a dream and overcome all obstacles to achieve it. The third necessary characteristic is that the intrapreneur must be flexible and create management options. An intrapreneur is open to and encourages change. By challenging the beliefs and assumptions of the corporation, an intrapreneur can create something new in the organization structure. He or she must possess the ability to encourage teamwork and use a multi-disciplined approach. Every new company formation requires a broad range of business skills. The intrapreneur must be a good diplomat to minimize disruption. Open discussion must be encouraged to develop a good team for creating something new. Many corporate managers have forgotten that frank, open discussion is part of the learning process. A successful venture can be formed only when the team feels the freedom to disagree and to critique an idea. The degree of openness among the team depends on the degree of openness of the intrapreneur. Openness leads to a strong coalition of supporters and encouragers. The intrapreneur must encourage each team member, particularly during hard times. A good intrapreneur makes everyone a hero. Only through persistence will a new venture be created and successful commercialization result. ESTABLISHING INTRAPRENEURSHIP IN THE ORGANIZATION To establish an intrapreneurial environment, the organization must implement a procedure. This can be done internally, but it is easier to use an outsider to facilitate the process. This is particularly true when the environment is very traditional. There are some steps involved in it. Step 1: The first step is to secure a commitment to intrapreneurship in the organization by top, upper, and middle management. Without top management commitment, the organization will never be able to make the necessary changes. Once top management has committed to intrapreneurship for a sufficient length of time, the concept is introduced throughout the organization. This is effectively accomplished through seminars. General guidelines need to be  © Copyright Virtual University of Pakistan 20 Entrepreneurship—MGT602 VU stablished for intrapreneurial venture development. Next, intrapreneurial leaders need to be identified, selected, and trained. Step 2: Ideas and general interest areas should be identified, along with the amount of risk money that is available. The overall expectat ions and target results should be established, specifying time frame, profitability requirements, and impact of the organization. A mentor/sponsor system needs to be established. Step 3: A company needs to use technology to make itself faster and more flexible. Technology has allowed small companies to act like they are big ones. Large companies can use technology to make them responsive and flexible. Step 4: The organization can use a group of managers to train and share their experiences with other members. These sessions should be conducted one day per month for a specified period of time. Information about intrapreneurship and about the company’s specific activities should be well publicized. Step 5: The organization needs to develop ways to get closer to its customers by tapping the data base, hiring from smaller rivals, and helping the retailer. Step 6: An organization must learn to be more productive with fewer resources. With middle management cutbacks, more control has been given to lower levels of the organization. The span of control should be increased. Step 7: The organization needs to establish a strong support structure. Because they do not immediately affect the bottom line, intrapreneurial activities can be overlooked and receive little funding. These ventures require flexible, innovative behavior, with the intrapreneurs having total authority over expenditures and access to funds. Step 8: The support must involve trying the rewards to the performance of the intrapreneurial unit. This encourages team members to work harder and compete more effectively. The equity portion of the compensation is particularly difficult to handle. Step 9: The organization needs to implement an evaluation system that allows successful units to expand and unsuccessful ones to be eliminated. PROBLEMS AND SUCCESSFUL EFFORTS Intrapreneurship, also called corporate venturing, is not without problems. One study found that new ventures started within a corporation performed worse than those started independently. Independent start-ups tend to outperform corporate start-ups. There are many examples of companies that have successfully implemented intrapreneurship. 3M allows employees to devote 15 percent of their time to independent projects. After failing to recognize the potential of Wozniak’s personal computer, Hewlett-Packard has taken steps to take advantage of future opportunities. Even IBM has developed the independent business unit concept. The problems of ntrapreneurship are not insurmountable, and the concept can lead to new products, growth and the development of an entirely new corporate environment and culture.  © Copyright Virtual University of Pakistan 21 Entrepreneurship—MGT602 THE INDIVIDUAL ENTREPRENEUR Lesson 08 LEARNING OBJECTIV ES 1. To iden tify some key entrepreneurial feelings and motivations. 2. To identify key elements in an entrepreneur’s background. 3. To discuss the importance of role models and support systems. 4. To identify the similarities and differences between male and female entrepreneurs. 5. To explain the differences between inventors and entrepreneurs. VU ENTREPR E NEURIAL FEELINGS There is no â€Å"true entrepreneurial profile†- entrepreneurs come from many educational backgrounds, family situations, and work experiences. A potential entrepreneur may presently be a nurse, secretary, assembly line worker, sales person, mechanic, home maker, manager or engineer. A potential entrepreneur can be male or female and of any race or nationality. Locus of Control One concern people have when forming is whether they will be able to sustain the drive and energy required to form something new and to manage the new enterprise and make it grow. While research results are inconsistent, internal control seems to be a characteristic of entrepreneurs. Internal beliefs appear to differentiate entrepreneurs from the general public, but not from managers. Managers and entrepreneurs both have an internality tendency. Feelings about Independence and Need for Achievement. The entrepreneur also has the need for independence, to do things in his or her own way and time. Another controversial characteristic is the entrepreneur’s need for achievement. McClelland specified three attributes as characteristics of entrepreneurs: 1. Individual responsibility for solving problems and setting and achieving goals. 2. Moderate risk taking as a function of skill. 3. Knowledge of results of decision/task accomplishment. McClelland concluded that a high need for achievement leads individuals to engage in entrepreneurial behavior, although other studies have been inconsistent. Risk Taking Risk taking seems a part of the entrepreneurial process. However, it has not yet been empirically established whether risk-taking is a distinguishing characteristics of entrepreneurs. ENTREPR E NEURIAL BACKGRO UND AND CHARACT E RIST ICS Only a few background characteristics have differentiated the entrepreneur from the general populace or managers. Childhood Family Environment The impact of birth order and social status has had conflicting research results. There is strong evidence that entrepreneurs, both male and female, tend to have self-employed or entrepreneurial fathers. Having a father who is self-employed provides a strong inspiration in the example of independence and flexibility of self-employment. This feeling of independence is often further enforced by an entrepreneurial mother. The overall parental  © Copyright Virtual University of Pakistan 22 Entrepreneurship—MGT602 VU relationship may be the most important aspect of the childhood environment in establishing the desirability of entrepreneurial activity. Parents of entrepreneurs need to be supportive and encourage independence, achievement, and responsibility. This supportive relationship appears to be most important for females. Female entrepreneurs tend to grow up in middle- to upper-class environments, where families are child-centered, and are similar to their fathers in personality. KEY TERMS Departure points The activities occurring when the venture is started Inventor An individual who creates something new Locus of control An attribute indicating the sense of control that a person has over life Moral-support network Individuals who give psychological support to an entrepreneur Entrepreneurship – MGT602 VU  © Copyright Virtual University of Pakistan 23 Entrepreneurship—MGT602 VU THE INDIVIDUAL ENTREPRENEUR (continued†¦) Lesson 09 LEARNING OBJECTIVES 1. To identify some key entrepreneurial feelings and motivations. 2. To identify key elements in an entrepreneur’s background. 3. To discuss the importance of role models and support systems. 4. To identify the similarities and differences between male and female entrepreneurs. 5. To explain the differences between inventors and entrepreneurs. ENTREPRENEURIAL BACKGROUND AND CHARACTERISTICS Education Education appears important in the upbringing of the entrepreneur, in the level of education obtained and in playing a major role in coping with problems. Although formal education is not necessary for starting a new business, it does provide a good background. In education, female entrepreneurs previously experienced some disadvantage, with few having degrees in engineering, science, or math. The ability to deal with people and communicate clearly in written and spoken work is also important. Personal Values Studies have failed to indicate that entrepreneurs can be differentiated on personal valued from managers, unsuccessful entrepreneurs, or the general public. Leadership, support, aggression, benevolence, conformity, creativity, veracity, and resource seeking may also be important. A successful entrepreneur is frequently characterized as a winner; winning may be a prerequisite for his or her actually becoming one. Age Entrepreneurial age is the age of the entrepreneur reflected in the experience. Entrepreneurial experience is one of the best predictors of success. In chronological age, most entrepreneurs start their careers between ages 22 and 55. Earlier starts in an entrepreneurial career seem to be better than later ones. Generally, male entrepreneurs start their first venture in their early 30s, while women tend to do so in their middle 30s. Work History Dissatisfaction with one’s job often motivates the launching of a new venture. Previous technical and industry experience is also important once the decision to start a business is made. Experience in the following areas is particularly important: financing; product or service development; manufacturing; development of distribution channels; and preparation of a marketing plan. As the venture becomes established, managerial experience and skills become more important. Entrepreneurial experience becomes increasingly important as the complexity of the venture increases. MOTIVATION While motivations may vary, the reason cited most often for becoming an entrepreneur independence-not wants to work for anyone else. Other motivating factors differ between male and female entrepreneurs. Money is the second reason for men’s starting a venture. Job satisfaction, achievement, opportunity, and money are the second order reasons for women.  © Copyright Virtual University of Pakistan 24 Entrepreneurship—MGT602 VU KEY TERMS Motivations That causes people to do something Need for achievement An individual’s need to be recognized Need for independence. Being one’s own boss-one of the strongest needs of an entrepreneur Professional-support network Individuals who help the entrepreneur in business activities Role models Individuals influencing an entrepreneur’s career choice and style Social status The level at which an individual in viewed by society Work history The past work experiences of an individual  © Copyright Virtual University of Pakistan 25 Entrepreneurship—MGT602 VU THE INDIVIDUAL ENTREPRENEUR (continued†¦) Lesson 10 LEARNING OBJECTIVES 1. To identify some key entrepreneurial feelings and motivations. 2. To identify key elements in an entrepreneur’s background. 3. To discuss the importance of role models and support systems. 4. To identify the similarities and differences between male and female entrepreneurs. 5. To explain the differences between inventors and entrepreneurs. ROLE MODELS AND SUPPORT SYSTEMS One of the most important factors influencing entrepreneurs in their career choice is role models. Role models can be parents, relatives, or successful entrepreneurs in the community. Role models can also serve in a supportive capacity as mentors during and after the new venture is launched. This support system is most crucial during the start-up phase. It is important that an entrepreneur establish connections to support resources early in the venture formation process. As contacts expand they form a network with density (extensiveness of ties between two individuals) and centrality (the total distance of the entrepreneur to all other individuals. ) The strength of ties between the entrepreneur and any individual is dependent on the frequency, level, and reciprocity of the relationship. An informal network for moral and professional support benefits the entrepreneur. Moral-Support Network It is important for the entrepreneur to establish a moral support network of family and friends. Most entrepreneurs indicate that their spouses are their biggest supporters. Friends can provide advice that is more honest than that received from others, plus encouragement, understanding, and assistance. Relatives can also be sources of moral support, particularly if they are also entrepreneurs. Professional-Support Network The entrepreneur also needs advice and counsel, which can be obtained from members of a professional support network. A mentor-protege relationship is an excellent way to secure the needed professional advice. The mentor is a coach, sounding board, and advocate. The individual selected needs to be an expert in the field. An entrepreneur can initiate the â€Å"mentor-finding process† by identifying and contacting a number of experts. The mentor should be periodically apprised of the progress of the business so that a relationship can gradually develop. Another source of advice is a network of business associates. Self-employed individuals who have experience in starting a business are good sources. Clients and buyers are also important as they provide word-of-mouth advertising. Suppliers are good components of the professional-support network-they help to establish credibility with creditors and customers, and provide good information on trends in the industry. Trade associations are good network additions, as they keep up with new developments and can provide overall industry data. Affiliations ith individuals developed in hobbies, sporting events, civic involvements and school alumni groups are excellent sources of referrals, advice, and information. Each entrepreneur needs to establish both a moral- and a professional-support network to share problems with and gain overall support. MALE VERSUS FEMALE ENTREPREN EURS Women are now starting new ventures at three times the rate of men. Women form over 70  © Copyright Virtual University of Pakistan 26 Entrepreneurship—MGT602 VU percent of all new businesses. Women now own over 8. 5 million small businesses, an increase of over 45 percent since 1990. In some respects female entrepreneurs possess very different motivations, business skills, and occupational backgrounds. Factors in the start-up process for male and female entrepreneurs are different, especially in such areas as support systems, sources of funds, and problems. Men are motivated by the drive to control their own destinies. Women tend to be more motivated by the need for achievement arising from job frustration. Departure points and reasons for starting the business are similar for both men and women. Both generally have a strong interest and experience in the area of their venture. For men, the transition to a new venture is easier when the venture is an outgrowth of a present job. Women often leave a previous occupation with a high level of frustration and enthusiasm for the new venture rather than experience. Start-Up Financing Males often have investors, bank loans, or personal loans in addition to personal funds as sources of startup capital. Women usually rely solely on personal assets or savings. Obtaining financing and lines of credit are major problems for women. Occupations Both groups tend to have experience in the field of their ventures. Men more often have experience in manufacturing, finance, or technical areas. Most women usually have administrative experience, often in service-related fields. Personality Both men and women tend to be energetic, goal-oriented, and independent. Men are often more confident and less flexible and tolerant than women. Backgrounds The backgrounds of male and female entrepreneurs tend to be similar. Women are little older when they embark on their careers. Men often have studied in technical- or business-related areas, while women tend to have liberal arts education. Many women busi How to cite Enterperneurship and Notes, Papers