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CCT112 - Week 3 Notes
Notes for Week 3 of CCT112
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Week 3 NotesJanuary 31, 2023 8:24 PM
Chapter 5
Understanding and embracing an entrepreneurial mindset
The Context of entrepreneurship
Entrepreneurship
• The process of starting new organizations, generally in response to opportunities
Social Enterprises/ventures
• Organizations that are started in response to needs within the community
How can entrepreneurial ventures add value?
• Creative destruction
○ (joseph Schumpeter) the process of transformation that accompanies radical innovation
where the way things were done before is destroyed.
• Entrepreneurially alert
○ (Israel kirzner) : Entrepreneurs are able to perceive the opportunities for entrepreneurial
profits by being sensitive to signals in the marketplace
• Entrepreneurial Ventures
○ Organizations that pursue opportunities, are characterized by innovative practices, and have
growth and profitability as their main goals.
• Small business
○ An organization that is independently owned, operated, and financed; has fewer than 1pp
employees; doesn't necessarily engage in any new or innovative practices and has relatively
little impact on its industry
Role of entrepreneurial managers
• Opportunities can be recognized, discovered or enacted
• A recognition strategy works best when both supply and demand are known
• Entrepreneur relies on his or her experience and actively employs sophisticated search techniques
to discover the opportunity.
• When neither supply nor demand is known and the entrepreneur creates something new or
enacts an opportunity
Entrepreneurship vs Self employment
• Self employment
○ Refers to individuals who work for profit or fees in their own business, profession, trade or
farm
• Entrepreneurs may self employed or they become employees of the company they have started
• Tax requirements and certain laws require that both entrepreneurs and self employed individuals
create a legally recognized organization
Why is entrepreneurship important ?
• Innovation
• Number of new start ups
• Job creation
• Global entrepreneurship
Innovation
• A process of changing, experimenting, transforming and revolutionizing, and its a key aspect of
entrepreneurial activity
• Entrepreneurial firms as a "agents of change" by provide an essential source of new and unique
ideas that may otherwise go untapped
• Small firms produce approximately 30 times more patents per employee than large patenting
, firms
Number of new start ups
• All businesses - whether they fit the definition of entrepreneurial ventures or not were new start
ups at one point in time, the most suitable measure we have of the important role of
entrepreneurship is to look at the number of new firms over a period of time.
• As of December 2018 there were 1.2 million employer business registered in canada, of these,
1.18 million were small businesses (97.950, 22 266 were medium sized businesses (1.95%) and
3010 were large enterprises
Job creation
• Job creation is important to the overall long term economic health of communities, regions, and
nations
• Businesses with fewer than 100 employees represent 97.7% of the total business establishments
in Canada
• Small businesses employ 8.4 million employees or 70% of the Canadian private workforce and
were responsible for creating 67.5% of all private jobs from 2003 to 2017
Global Entrepreneurship
• Global entrepreneurship monitor (GEM) - studies the impact of entrepreneurial activity on
economic growth in various countries
• The 2016 GEM covered 60 economies and surveyed more than 120,000 adults and revealed that
people aged 25 to 44 wee much more likely to be entrepreneurs than individuals who are late in
their career
What do entrepreneurs do?
• Initially, an entrepreneur is engaged in assessing the potentioal for the entrepreneurial venture
and then dealing with start up issues, then the entrepreneur
○ Researches the ventures feasibility
○ Proceeds to plan the venture
○ Organizing the venture
○ Launches the venture
○ Switches into more of a managerial role
The Timmons model of the entrepreneurial process
Social responsibility and ethical issues facing entrepreneurs
• The international standards organization has developed standards for sustainability and for social
responsibility
• There are some entrepreneurs who take their social responsibilities seriously
• Entrepreneurs have pursued opportunities with products and services that protect the global
environment
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