Entrepreneur – Definition, Functions and Characteristics

Entrepreneur is an individual who, operate, takes risks of a business. Which means the process of running a business by their own. Due to economic crisis through out the world these days, most of the countries are encouraging people to be and entrepreneurial which leads to increase in the jobs for the people and increase the economy of the country. People become entrepreneurs by them-self to start a business when they are controlled by many factors around them. Some people want to leave their jobs and start own business and few people want to earn money sitting at home. May be some people look for the needs for a market and to meet those needs they start their own business by supplying products for the market. If they succeed in this process this makes them successful entrepreneur.

Entrepreneur is an individual or group of individuals who identify the business opportunity then try to reach the business goal or create business value through providing an innovative solution for business difficulties and also realize and accept the risks involved in the business. Entrepreneur came from small business, now a days small business have changed the market significantly and plays an important role in the economic development.

Entrepreneur - Definition, Functions and Characteristics

The entrepreneur is defined as a person who creates and innovates a recognized value of something around the perceived opportunities. Some people still chase for an opportunities to create something after they have reached a position and live a life of luxury, they cannot stop themselves because of there natural behavior. The recognized value can be either Economic, Social or Aesthetic capital. Entrepreneurs can be found in large corporations such as private or public sectors

An entrepreneur can be defined according to six characters; Focus, Advantage, Creativity, Ego-inner and outer, Team and Social. Focus covers target focus, time focus and action focus which provides an evidence of urgency by an entrepreneur to get on with things. Creativity involves ideas and opportunities. Advantage differentiates between the value created and added. Ego has six components split into inner and outer ego the inner ego includes motivation, self-assurance and dedication. The outer ego includes responsibility, accountability and an ability to deal with set backs. Team is a distinct feature that manipulate the characteristics of focus, advantage and creativity. Social influence the nature of the business whether it is a profit or non profit business and it also effects the culture and style of an organisation in which way the employees are treated.

Functions of an Entrepreneur

Entrepreneur can be described as a small business owner from an economic prospective which states that, these small business forms a structure. This structure plays an important role in the economic development which improves the living and working condition and the characteristics function of an entrepreneur can be reflected in a creative response to the changing condition as a result the new ways of development comes in existence by the entrepreneur. Therefore, the function of an entrepreneur is to improve the economy by doing business in an innovative way. The main tasks of an entrepreneur is to recognize the business opportunity, start of their own business, gathering funds for the start of business, advertising the business in the market, analyzing the risk and providing leadership.

Characteristics of an Entrepreneur

  1. Innovativeness: Innovation is one of the important character of an entrepreneur which includes creating of new products or new quality, creating new methods of production to get into the market or to create a new organisation or structure in business. A successful innovation demands a will which is, it demands the leader of the innovation. Innovativeness is a behavior of a person which characterizes the difference between entrepreneurship and entrepreneurial orientation. Innovation is a systematic search for opportunities in new market, products or ideas.
  2. Need for achievement: The theory of McClelland on the need for achievement is one of the most applied theories on entrepreneurship which suggest that, the need for achievement forces the person to struggle for the success. A person who as a strong need for achievement can solve problems themselves, set targets and achieve the targets by their own efforts and they also deliver high performance in achieving the tasks and innovative in doing things.
  3. Locus of control: Locus of control is also an important character which is related to a individual as whether he or she can handle the events in life. An individual with external locus of control believe beyond the circumstances like luck and fate, where as individual with internal locus of control believes in personal control events and effects in lives. For an individual to become a entrepreneur he should have a internal locus of control.
  4. Risk taking tendency:  Risk taking tendency refers to an individual who can handle or avoid the risks in a situations when needed. An entrepreneur is associated with risk, the main factor of differentiating entrepreneurs from a employed workers was a doubt and risk involved by the former. The difference between the manager and the entrepreneur in a business activities are entrepreneur personally takes all the risks an profits involved in the business how every an individual who is in uncertain environment causes risks related to financial well-being,career opportunities, family relations and emotional state.
  5. Tolerance for ambiguity:  Uncertainty occurs when there is an insufficient data. An individual should respond positively to ambiguous situations. People with low level of tolerance for ambiguity find uncertain and unstructured situation more complicated. Entrepreneurial managers are believed to tolerate ambiguity better than the conservative mangers in the organisations because entrepreneurial managers face a less structured, more uncertain set of possibilities and bear the whole responsibilities for decision making.
  6. Self confidence:  An individual should have a self confidence because they work on complete demanding tasks. Self confidence is an outcome of an entrepreneurship an entrepreneur demonstrates a higher degree of self confidence when compared to others.
  7. Positive motions:  The feelings and activeness of personality are motive forces for all human creations. The positive motions affect the variables called feelings and emotions which is a link between them and they are analysed in different environments. The positive motion indicates the positive feeling which promotes creativity.
  8. Creativity:  Creativity performs a link between positive motion and innovation and also performs a link between creativity and starting up a new venture. Creativity is considered as one of the most important factors for creation of new venture which is created by individuals and called as entrepreneurs. It includes the outcomes generated by creativity. Many business ideas are generated by creativity but the creation should be in such a way that they are commercially feasible to implement the ideas into real world. There are few factors influencing the creation of new ventures.
  9. Understanding the opportunity:  Entrepreneur is one who explores for changes, responds to it and searches for an opportunity. The opportunity describes the area of need or challenge on which the problems should be focused. And problems should generate answers to bring the key information and feelings etc.

Leave a Reply

Your email address will not be published. Required fields are marked *