Meaning and Definition of Entrepreneurship
Entrepreneurship (‘Entrepreneurship’) is derived from the root word ‘Udyam’ of Hindi language. Enterprise means to mobilize resources, plan work and implement the plan so that profit can be obtained for the fulfillment of a certain objective. Enterprise is the only means of earning a living. Whatever business a businessman pursues, there is a risk in it. The degree of risk depends on the size of the business and the skill of the entrepreneur. A person who takes risks is called an ‘entrepreneur’. The ability to take risks is called entrepreneurship. By continuing to do the same business, the entrepreneur becomes efficient in his business and entrepreneurship is directly related to efficiency. Entrepreneur’s nature, behavior and efficiency is called ‘Entrepreneurship’. Every person sets his goal and tries to achieve it, but each person’s ability to set and achieve the goal is different. Every person sets his goal according to his culture, environment and mentality developed by education. Therefore, entrepreneurship means the bold ability to set up new ventures, take risks, take profitable bold decisions and change. Through entrepreneurship, the use of resources, use of latest technology, creation of employment, dynamic leadership, creation of utility, etc. So entrepreneurship is a combination of process and spirit. It is not only a method of earning a living but also an effective technique for skill and personality development. For this reason, different concepts of entrepreneurship are prevalent today. Entrepreneurship is sometimes referred to as organization and coordinator, sometimes as psychological motivation, sometimes as group action.
(1) J. According to J. E. Stepanck, “Entrepreneurship is the ability of an enterprise to take risks, the ability to organize and to diversify and give birth to innovators.”
(2) According to Arthur H. Cole, “Entrepreneurship is that act of individuals gathered as an individual or group by which a profit-oriented business unit is established, operated and developed so that to produce and distribute economic goods and services.
(3) According to Pareek and Nadkarni, “Entrepreneurship refers to the general nature of setting up new undertakings in the society.”
(4) H. W. According to Johnson (H. W. Johnson), “Entrepreneurship consists of three basic elements – innovation, innovation and adaptation”.
(5) Joseph A. According to Joseph A. Schumpter, “Entrepreneurship is an innovation function. It is a leadership function rather than a sum total of ownership.”
(6) Peter F. According to Drucker (Peter F. Drucker), it is important to maximize opportunities in business. In fact, this is the correct definition of entrepreneurship.
(7) According to Locks, “Entrepreneurship is a combination of the willingness to take risks, the desire for income and prestige and the desire for self-expression, creativity and freedom.”
(8) Robert K. According to Lamb (Robert K. Lamb), “Entrepreneurship is that form of social decision-making which is carried out by economic innovations”.
(9) According to Richman and Koppen, “Entrepreneurship refers to any creative external or open system. It is an act of innovation, risk taking and dynamic leadership.”
(10) K. Of. According to Gupta (K. K. Gupta), “Entrepreneurship refers to the ability to discover new opportunities in business, undertake social innovation and take profitable bold decisions.”
In short we can say that culture, environment and mentality together these three inspire a person to set a goal towards some work and as a result, the ability to work is generated that is Entrepreneurship (Entrepreneurship).
Characteristics of Entrepreneurship / Characteristics of Entrepreneurship
The main feature of entrepreneurship is always striving towards achieving certain objectives. Various scholars have given the following characteristics to entrepreneurship-
(1) Environment Driven Activities – Entrepreneurship is an open system inspired by the environment, because it is developed by taking into account the factors of social, political, scientific, technological, economic and natural environment and their changes. Joseph A. Schumpeter (Joseph A. Schumpter) said that “Entrepreneurship is the constructive answer to every external situation.” This statement makes it clear that the effect of continuous change in the thoughts of individuals as a result of social beliefs, education, science, population, government policies, etc., catalyzes the development of entrepreneurship.
(2) Risk-taking ability – An important feature of entrepreneurship is the ability to take risks. Entrepreneurship involves the spirit of business to face uncertainties and take risks. There are many risks involved in any new business which can be taken on the basis of courage. In the context of risk and success of economic and business activities, the Japanese phrase ‘fall seven times, rise eight times’ refers to the risk-taking ability of entrepreneurship. Peter F. Drucker (Peter F. Drucker) is of the view that “To consider entrepreneurship too risky is just an illusion, entrepreneurship is not gambling.” This statement makes it clear that entrepreneurship does not remain risky if it is managed properly, adopting appropriate research method and following the principles.
(3) Creative activity – The main feature of entrepreneurship is creative. Therefore, entrepreneurship inspires a person to discover new opportunities, think creatively and implement new ideas. Joseph A. In the words of Schumpeter, “Entrepreneurship is essentially a creative activity.” This statement makes it clear that creative thinking always gives inspiration to implement positive, original and practical ideas.
(4) Innovation work – Entrepreneurship is an innovative work by which creative ideas can be implemented. Innovation includes new technology, new resources, new production, new managerial skills etc. Joseph A. According to Schumpeter “Entrepreneurship is purposeful and systematic innovation”. Peter F. According to Drucker, innovation is the special tool of entrepreneurship.
(5) Process of Personality Formation – Entrepreneurship is not only adopting any new idea, new action or new behavior, but it is the process of identity or personality formation of the individual. Today, no person becomes an entrepreneur just by adopting innovation, but he establishes his identity by constantly engaging in it. Therefore entrepreneurship is also a process of personality formation.
(6) Entrepreneurship is not a personal trait, but a behavior – decision making is important in every field but decisions have risks. Therefore, by developing the ability to make decisions, every person can become an entrepreneur and can behave boldly. For this reason Peter F. Ducker says that “Entrepreneurship is not a personality trait, but a conduct.”
(7) There is a sense of self-reliance – Entrepreneurship awakens the feeling of self-reliance in the person. The country whose people consider self-employment as the purpose of their life, they are more progressive and have the highest spirit of entrepreneurship.
(8) Entrepreneurship is the driving force – Entrepreneurship always motivates a person to make continuous efforts to achieve certain objectives. Entrepreneurship gives motivation to a person to imagine business, plan for social progress and start some use.
(9) Knowledge-Based Behavior – Entrepreneurship is a knowledge-based activity. Entrepreneurship is born on the basis of knowledge and experience. Entrepreneurship is not achieved without knowledge and without experience there is no practice of entrepreneurship. Peter F. In the words of Ecker, “Entrepreneurship is neither a science nor an art, it is a practice; knowledge is its basis.” Entrepreneurship is not just a feeling arising out of the intuition or motivation of the individual. It is based on principles, ideology and practice. Knowledge of economics, management, technical statistics, law, sociology, psychological and behavioral science is essential for developing entrepreneurship.
(10) Entrepreneurship is a lifestyle – Entrepreneurship is not only a work, business or profession, but it is also a lifestyle. Entrepreneurship is a lifestyle that establishes a person as a successful businessman, professional, politician, philanthropist, scientist or in any other way and provides a distinct identity in the society.
Theories of Entrepreneurship
The various principles of entrepreneurship can be briefly explained as follows:
1. Psychological Theories – According to this theory or ideology, the basic motivator of the development of entrepreneurship is the psychological component, that is, the internal desires, attitudes and motivations of the individual have a huge impact on the development of entrepreneurship. The main psychological theories or ideologies are as follows
(i) Innovation ideology – This ideology has been developed by Joseph Schumpeter, in which innovation has been described as the main task of the entrepreneur and said that the behavior of the entrepreneur is creative in every situation. According to Schumpeter, an entrepreneur is an innovator who desires to earn profit through innovation. Psychological powers are inherent in it and it is motivated by them. Because the entrepreneur is born out of the desire to establish his own industrial empire and the goal of enjoying the creation or experiencing the skill. Therefore, the entrepreneur is not a technical person or a capitalist, but he is an ‘innovator’ who also desires to make profit through new changes.
(ii) Achievement ideology- This ideology has been propounded by McClelland. They are of the view that a strong desire for achievement attracts a person towards entrepreneurial activities. The ability to be an entrepreneur develops in a person only with the feeling of touching the heights of excellence and achieving special achievements in the field of business or industry. For high achievement, the entrepreneur needs sufficient imagination, thinking-reflection, new combination etc.
(iii) Minor group ideology – This ideology has been propounded by Everett Hagen, which believes that the creativity of a victim minority group in the society is the main source of entrepreneurship. It has developed this ideology based on the ‘Samarai community’ of Japan. According to this ideology, the loss of prestige of a social group becomes the root cause of its personality formation and entrepreneurial development.
(iv) Behaviorist ideology- This ideology has been developed by John Kunkel, who believes that the development of entrepreneurship depends on the past and existing social structure of any society and it is influenced by various socio-economic motivations. According to them, entrepreneurship depends on a particular combination of circumstances, which are difficult to create but easy to destroy. Entrepreneurship is basically the outcome of the socio-economic structure of a country.
2. Sociological Theories – Sociologists have been recognized that courageous actions are influenced by the values of the society. The position of different individuals in the society, tradition, cultural values, group dynamics etc. factors influence the development of entrepreneurship. Sociological ideologies are based on this assumption. The main sociological ideologies are in the fore–
(i) The ideology of social change – This ideology of entrepreneurship has been developed by Max Weber who first tried to state that the development of entrepreneurship is dependent on the moral value system of the society concerned. They believe that the religion and sect in which a person lives and the religious values and beliefs he accepts, are the only factors in his professional life. Entrepreneurial energy.
(ii) Cultural Value Ideology – This theory has been propounded by Thomas Cochrane. According to Thomas Cochrane’s ideology, “Cultural values, roles, aspirations and social approval play an important role in the development of entrepreneurship.” Entrepreneur’s performance depends upon his profession, role, aspirations, approval groups, professional requirements of the work, social values etc. and his personal tendency.
(iii) Entrepreneurial Group Ideology – This ideology was developed by F. W. Young, who stresses that entrepreneurial activity extends from entrepreneurial groups, not individuals, because groups have the ability to respond to specificity. They are of the opinion that when a sub-group feels low status and status in a large society, its reaction ability gives rise to entrepreneurial behavior in the society.
(iv) Cultural ideology – This ideology of entrepreneurship emphasizes that the development of entrepreneurship is possible only in a society where social responses are not stable, but where there are wide options for employment of the individual and which Encourages personality development of entrepreneurial individuals.
3. Economic Theory – The exponent of this theory is mainly G. F. Papanek (G. F. Papanek) and J. R. Haris (J. R. Harries). According to him, “Economic motivations are the main driving force of entrepreneurship”. These scholars are of the opinion that favorable economic conditions contribute the most in the birth and development of entrepreneurship. In some cases this is not visible, but the internal driver of the person is always related to economic benefits. From this point of view, these economic incentives and profits are a sufficient condition for the origin of industrial entrepreneurship.
4. Integrated Theory The integrated theory of entrepreneurship emphasizes that entrepreneurship is influenced by many social, economic, political and psychological factors or that the development of entrepreneurship is the result of many factors. Following are the major unifying ideologies–
(i) Entrepreneurial Disposition Theory – This ideology has been propounded by T.V.Rao. T.V. Rao has considered the Entrepreneurial Disposition to be very important in the development of entrepreneurship. If seen, the very basis of entrepreneurship is to have an adventurous attitude. If the adventurous attitude is removed from the entrepreneur, then his entire existence will end. It is the courageous attitude of the entrepreneur that motivates him to take risks, step forward and set up new ventures.
(ii) Process Theory – Shri Venkatarao has given five stages of process ideology of development of entrepreneurship, which include motivation, identification, development, promotion and follow-up action. First of all, an environment of development is created by providing incentives for the development of entrepreneurship. After that entrepreneurial people are identified and they are induced towards creative work, after that managerial, technical and vocational guidance programs are conducted for the development of the entrepreneurs.