What do you mean by Entrepreneur?
The person who started his own business with own money is known as an entrepreneur. Entrepreneur is the owner of his own started business. Entrepreneur doesn’t require any formal academic qualification for started business.
In other words an entrepreneur is independent to develop ideas for smooth running of his own started business. Entrepreneur deals with his personal vision inorder to increase profit and productivity. Entrepreneur creates entrepreneurship, without entrepreneur there is no need of entrepreneurship.
- What is Schumpeter Innovation theory? Distinguish between Innovater and inventer/Limitations and Forms of Innovation theory.
Function Of Entrepreneur
The function of an entrepreneur from the generation of idea up to the establishment of an enterprise.Such function of an entrepreneur is broadly divided into three categories that is:-
Innovation is considered as the most important form of making something new.It encourages something new by using creative ideas.It helps in application of new products,searching new sources etc.
Another important function of an entrepreneur is to identify and generate the idea for starting a business.It ensures to adopt various latest techniques in the production process which is possible through vision, education,expression etc.
iii.Scanning of environment
The scanning of the environment and yet considered as another most essential characterised function of entrepreneurs to understand economic, political, natural and technological surroundings of business enterprise. It indirectly helps to better functioning of business.
The other most important function is study which is undertaken after environmental scanning.It means the study of the possibility of success of an idea and its reality.It considers various expected problems that may arise in the implementation of an idea and its effect.
v.Development of business plan and objective
The development of a business plan and objective is considered as another function of an entrepreneur.The business plan refers to the struggle involved in starting and running the business whereas a business objective defines the end towards which activities are directed.
The risk element refers to the future uncertainties which are always present in a business plan.But the risk element is very high in entrepreneurship as it’s conversed with innovation so risk bearing is the most essential function of an entrepreneur.
vii.Managing of fund
Another function of an entrepreneur is the effective management of funds.The management of funds is very much essential for smooth running of enterprise as well as the activities of a business depends upon the finance.Therefore it is considered as the lifeblood of every organisation.
viii.Procurement of machine & materials
The procurement of required machines and materials is yet considered as another function of an entrepreneur.It enables them to arrange cheap & regular sources of raw materials and adept latest technology in order to face competition.
ix.Market analysis & research
The market analysis is considered with collection or various information of the market.It helps to know the linking of customer their requirement and purchasing power.It also enables them to produce product according to market situation and demand or market.
x.Determination of form of enterprise
Another important function of an entrepreneur is to determine the form of enterprise that should be establish.He also decide the legal concept of business form of ownership,authority and responsibility attached with a concerned enterprise.
Leadership is considered as another function of an entrepreneur which is very much essential for the success of enterprise.It refers to the capacity of a leader to lead the work under his guidance.The successful leader must have qualities of self motivation and self confidence for effective implementation of ideas.
The last but not the least function of an entrepreneur is decision making.The power or taking effective decisions in time enables entrepreneurs to the opportunities and lead over competitors.
Decisions can only be taken if an entrepreneur has the power.
i.Effective work management.
ii.Continuous flows of action.
iii.Implementation of power.
What Is Family Business?
The business organisation that is entirely owned and managed by the member of single family is called family business.
In such business number of a family have ownership, interest and significant commitment towards business. Generally it is divided into 3 types that is:-
i.Family owner business.
ii.Family owner & managed business
iii.Family owner & led business.
i.Family owned Business
A business which is owned by a member of the family and whose activities are significantly influenced by other members of the family is called a family owned business.
ii.Family owner & managed business
The business in which measurity of share held by members of a single family and its members also take active part in the top management of the company is called family owned managed business.
iii.Family owned and led business
The business which is owned by one or more family members and one member has a measure of influence on business activities.
Conflicts Of Family Business
i.Lack of protection alien
The most important challenge fixed by family business is lack of protectionism. Generally it is managed by unqualified family members so sometimes the decisions taken are not fulfilled due to lack of professionalism in data maintenance.
ii.Separation of business
The possibility of separation of business is yet considered as another challenge of family business.Therefore the business may come to an end after its separation or it may be very difficult to continue the business separately.
iii.Not able to attract outside talent
Generally key positions held by the family business is yet considered as another challenge of family business.It creates obstacles for outsiders to get a position in the top management. Therefore they are able to attract outside talent to use their ideas and skills which may be useful to the family business.
The continuity of family business is very much affected by the conflict between family member.It arises due to mis-understanding and different views of its member.so much family conflict leads to liquidation of business in near business.
v.Family interest and business interest
The other challenge faced by family business is to identify family interest and business interest.Therefore the management body is enabled to differentiate unit.This interest in family concern becomes a serious problem in future.
Sometime the family members are not serious about the business matter they might become a tool with performing business activity.Therefore the business may suffer a lot due to such activity of family members.
vii.Role of female business
The female members of a family are also important in family business.But some of the business houses are still very conservative to open their door for their female members.This affiliate results in conflicts between the various member families.
viii.Short term approach
Generally family business adopts a short-term business approach with an absence of investment and product development.But such business may not be effective in long due to differentiation in attitude and education level of family members.
ix.Restractive decision making
The decision making in family business is strictly restricted to the members only so only those who are employees of the organisation are not involved in its decision making though they are highly talented and skilled.
The governance system of family business is highly unstructured.That leads to poor performance of a business so the success of family business depends upon a structured and good governance system like other business and corporate sectors.