EXTRACURRICULAR TOPIC 5: ENTREPRENEURSHIP

 

Life Skills Topic 5

ENTREPRENEURSHIP

Important Entrepreneurial Traits

The Important Entrepreneurial Traits

Mention important entrepreneurial traits

The following are the important entrepreneurial traits

1. Hard Working: running a business requires a lot of energy and drive. This involves the ability to work for long hours when necessary, to work intensely in spurts and to cope with less than a normal amount of sleep.
2. Self-Confident: to succeed, entrepreneurs have to believe in themselves and in their ability to achieve the goals they have set for themselves. This is often shown by a belief that “if you want something badly enough and are prepared to work at it, you’ll usually get it”.
3. Builds for the Future: the goal for most successful business people is to build a secure job and income for themselves which is based on their own abilities. This means entrepreneurs understand that it may take several years to build up business income to a reasonable standard.
4. Profit-Oriented: interest in generating money is a clear indicator of an entrepreneur’s suitability for being a business owner. This means recognizing that the business comes first. Once profits are generated, the entrepreneur can make decisions about how the profits can be used – to expand the enterprise or for personal use.
5. Goal-Oriented: success in business depends upon being able to set realistic goals or targets and to work with determination to achieve them. This ability to set goals (for things the person thinks are worthwhile) and to work to achieve them is fundamental to being an entrepreneur.
6. Persistent: all businesses have their problems and disappointments. Being persistent in solving a problem is one of the keys to being a successful entrepreneur.
7. Copes with Failure: all business ventures inevitably contain disappointments and failures as well as successes. Coping with failures involves recognizing these failures, learning from them and seeking new opportunities. Without this characteristic, early failures may end a person’s attempt at self-employment.
8. Responds to Feedback: entrepreneurs are concerned to know how well they are doing and to keep track of their performance. Obtaining useful feedback and advice from others is another important characteristic of entrepreneurs.
9. Demonstrates Initiative: research shows that successful entrepreneurs take the initiative and put themselves in positions where they are personally responsible for success or failure.
10. Willing to Listen: the successful entrepreneur is not an inward looking person that never uses outside resources. Self-reliance does not exclude the ability to ask for help when needed from such people as bank officials, accountants and business advisers. Being able to listen to the advice of others is a key characteristic of an entrepreneur.
11. Sets Own Standards: setting standards of performance and then working to achieve them is another indicator of a successful entrepreneur. These standards can be income, quality, sales or product turnover. Most entrepreneurs want to do better each year, to set and achieve higher standards from year to year.
12. Copes with Uncertainty: being an entrepreneur is much more uncertain than employment. This uncertainty is about sales and turnover, but it often also exists in other areas such as material delivery and prices, and bank support. An ability to cope with this uncertainty without becoming too stressed is a necessary trait of being an entrepreneur.
13. Committed: starting and running an enterprise demands total commitment by the entrepreneur in terms of time, money and lifestyle. It has to be a major priority in the entrepreneur’s life.
14. Builds on Strengths: successful business people base their work upon the strength(s) they have, such as manual skills, interpersonal skills, selling skills, organizational skills, writing skills, knowledge of a particular product or service, knowledge of people in a trade and ability to make and use a network of contacts.
15. Reliable and Has Integrity: the qualities of honesty, fair dealing and reliability in terms of doing what one has promised to do are essential traits of an entrepreneur.
16. Risk-Taker: being an entrepreneur involves some risks. Entrepreneurs have the ability to take measured or calculated risks. Such risks involve working out the likely costs and gains, the chance of success and the belief in oneself to make the risk pay off. Entrepreneurs may be considered risk avoiders when they reduce their risks by having others assume part of the risk. Those who assume the entrepreneur’s risk may be bankers, suppliers and customers.

Some people think of entrepreneurs as people who are willing to take risks that other people are not. Others define them as people who start and build successful businesses.

Thinking about the first of these definitions, entrepreneurship doesn't necessarily involve starting your own business. Many people who don't work for themselves are recognized as entrepreneurs within their organizations.

Regardless of how you define an "entrepreneur," one thing is certain: becoming a successful entrepreneur isn't easy.

So, how does one person successfully take advantage of an opportunity, while another, equally knowledgeable person does not? Do entrepreneurs have a different genetic makeup? Or do they operate from a different vantage point, that somehow directs their decisions for them?

Though many researchers have studied the subject, there are no definitive answers. What we do know is that successful entrepreneurs seem to have certain traits in common.

We've gathered these traits into four categories:

• Personal characteristics.
• Interpersonal skills.
• Critical and creative thinking skills.
• Practical skills.

We'll now examine each category in more detail, and look at some of the questions you will need to ask yourself if you want to become a successful entrepreneur.

Personal Characteristics

First, examine your personal characteristics, values, and beliefs. Do you have the mindset that's typical of successful entrepreneurs?

• Optimism: Are you an optimistic thinker? Optimism is truly an asset, and it will help get you through the tough times that many entrepreneurs experience as they find a business model that works for them.
• Vision: Can you easily see where things can be improved? Can you quickly grasp the "big picture," and explain this to others? And can you create a compelling vision of the future, and then inspire other people to engage with that vision?
• Initiative: Do you have initiative , and instinctively start problem-solving or business improvement projects?
• Desire for Control: Do you enjoy being in charge and making decisions? Are you motivated to lead others?
• Drive and Persistence: Are you self-motivated and energetic? And are you prepared to work hard, for a very long time, to realize your goals?
• Risk Tolerance: Are you able to take risks, and make decisions when facts are uncertain?
• Resilience: Are you resilient ,so that you can pick yourself up when things don't go as planned? And do you learn and grow from your mistakes and failures?

Interpersonal Skills

As a successful entrepreneur, you'll have to work closely with people – this is where it is critical to be able to build great relationships with your team, customers, suppliers, shareholders, investors, and more.

Some people are more gifted in this area than others, but, fortunately, you can learn and improve these skills. The types of interpersonal skills you'll need include:

• Leadership and Motivation: Can you lead and motivate others to follow you and deliver your vision? And are you able to delegate work to others? As a successful entrepreneur, you'll have to depend on others to get beyond a very early stage in your business – there's just too much to do all on your own!
• Communication Skills: Are you competent with all types of communication? You need to be able to communicate well to sell your vision of the future to investors, potential clients, team members, and more.
• Listening: Do you hear what others are telling you? Your ability to listen can make or break you as an entrepreneur. Make sure that you're skilled at active listening and empathetic listening.
• Personal Relations: Are you emotionally intelligent? The higher your EI, the easier it will be for you to work with others. The good news is that you can improve your emotional intelligence!
• Negotiation: Are you a good negotiator? Not only do you need to negotiate keen prices, you also need to be able to resolve difference between people in a positive, mutually beneficial way.
• Ethics: Do you deal with people based on respect, integrity, fairness, and truthfulness? Can you lead ethically? You'll find it hard to build a happy, committed team if you deal with people – staff, customers or suppliers – in a shabby way.

Critical and Creative Thinking Skills

As an entrepreneur, you also need to come up with fresh ideas, and make good decisions about opportunities and potential projects.

Many people think that you're either born creative or you're not. However, creativity is a skill that you can develop if you invest the time and effort.

• Creative Thinking: Are you able to see situations from a variety of perspectives and come up with original ideas?
• Problem Solving: How good are you at coming up with sound solutions to the problems you're facing?
• Recognizing Opportunities: Do you recognize opportunities when they present themselves? Can you spot a trend? And are you able to create a plan to take advantage of the opportunities you identify?

Practical Skills

You also need the practical skills and knowledge needed to produce goods or services effectively, and run a company.

• Goal Setting: Do you regularly set goals, create a plan to achieve them, and then carry out that plan?
• Planning and Organizing: Do you have the talents, skills, and abilities necessary to achieve your goals? Can you coordinate people to achieve these efficiently and effectively? (Here, effective project management skills are important, as are basic organization skills.) And do you know how to develop a coherent, well thought-through business plan, including developing and learning from appropriate financial forecast ?
• Decision Making: How good are you at making decisions? Do you make them based on relevant information and by weighing the potential consequences? And are you confident in the decisions that you make?
• Core decision-making tools include - Decision Tree Analysis
• Grid

You need knowledge in several areas when starting or running a business. For instance:

• Business knowledge: Do you have a good general knowledge of the main functional areas of a business (sales, marketing, finance, and operations), and are you able to operate or manage others in these areas with a reasonable degree of competence?
• Entrepreneurial knowledge: Do you understand how entrepreneurs raise capital? And do you understand the sheer amount of experimentation and hard work that may be needed to find a business model that works for you?
• Opportunity-specific knowledge: Do you understand the market you're attempting to enter, and do you know what you need to do to bring your product or service to market?
• Venture-specific knowledge: Do you know what you need to do to make this type of business successful? And do you understand the specifics of the business that you want to start? (This is where it's often useful to work for a short time in a similar business.)

You can also learn from others who have worked on projects similar to the ones that you're contemplating, or find a mentor – someone else who's been there before and is willing to coach you.

Is Running a Business for You?

Armed with this information, assess your skills in each of these areas. The harder you work to build your skills, the more successful you're likely to be.

Having said that, many successful business-owners are impulsive, uncomfortable with risk, or belligerent with colleagues and customers. Still others have little business knowledge, and have simply hired the talent they need to succeed.

You can succeed without some of these skills, however, the more you're missing, the more likely you are to fail.

As you work through your analysis, you may feel that you're ready to take the plunge into your own venture. Alternatively, you may decide to wait and further develop your skills. You may even decide that entrepreneurship isn't for you.

Whatever your choice, make sure that it feels right. Running a business isn't for everyone.

Key Points

While there is no one "right" set of characteristics for being a successful entrepreneur, certain general traits and practical skills will help you succeed.

By examining your own personal strengths and weaknesses and comparing these with those of the typical entrepreneur, you can get a sense of how well this career will fit with your personality.

Remember, becoming an entrepreneur is a career decision like any other. Do your homework, look at your needs and desires, and then decide whether this path is for you.

Self-employment

The Meaning, Advantages and Challenges of Self-Employment

Explain the meaning, advantages and challenges of self-employment

Is a situation in which an individual works for himself instead of working for an employer that pays a salary or a wage. A self-employedindividual earns his income through conducting profitable operations from a trade or business that he operates directly.

Advantages of self-employment

• Leads rather thanfollows
• Can implement ideas
• Can be creative
• Potential income unlimited
• Independence
• Can take initiative
• Controls work environment
• Gives orders

Challenges of Self Employment

• Long, irregular hours of work
• Broad responsibility
• Must take risks
• Income not stable nor guaranteed
• No fringe benefits
• Always involved infinances
• Time constraint
• Uncertain future
• Learning never ends
• Hard to delegate work
• Too much paperwork
• Dependent on employee actions

Paid Employment

The Meaning, Advantages and Challenges of Paid Employment

Explain the meaning, advantages and challenges of paid employment

Is a relationship between two parties, usually based on a contract where work is paid for in either monetary terms or other terms.

Advantages of Paid Employment

• Specific (or fixed)responsibilities
• Steady income
• Fringe benefits
• Fixed hours of work
• More certain future
• Set span of control
• Minimal risks

Challenges of Paid Employment

• Follows orders
• Ability not easily recognized
• Set income
• Limited responsibility
• Difficulty to implement ideas
• Dependent on theemployer

• READ TOPIC 6: Goal Setting

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