MODULE7

ENTREPRENEURSHIP
 The Philippine environment for
entrepreneurship

 Basic facts based on 2008 statistics

oPhilippine population = 90.4 M as projected
by NSO (last 2007 88.7 M)
oUnemployment rate = 7.8 % ( July 2008)
oUnderemployment rate = 18.9 % ( January
2008)
oOver 36.7 % are below the poverty level
oInvestment climate is vacillating
 Philippine entrepreneurial rate =

MSME = 99.6% Micro E = 91.1%

RP Enterprise Small E = 8.1%
Medium E = 0.4%
Large E = 0.4%
 What is entrepreneurship?
 Entrepreneurship is both an art and a
science of converting ideas into highly
marketable goods and services that will
improve man’s quality of life. It involves
the proper utilization of four essentials
such as materials, machine, money and
man (4Ms)
 Entrepreneurship has essential or extra
ordinary features such as the creation of
something new or something different. In
short, it is innovation which distinguishes
entrepreneurship from other activities.

 The key concept of entrepreneurship is

innovation. Any worthy activity which is
new, different or better implies
innovation. It implies to product, services
or methods.
 Contributions of entrepreneurship
Entrepreneurship brings not only to the
entrepreneurs but also to the country as a
whole.
1. Provide self-employment
2. Create employment for others
3. Develops industries especially in the rural
areas
4. Encourages the processing of local
materials into finished or semi-finished
goods
5. Generate additional income for the family
6. Encourages healthy competition which may
assure highest quality products
7. Makes more goods and services available
to the consumers
8. Promotes the use of modern technology in
small scale manufacturing to enhanced
productivity
9. Develops possible market
10. Encourages more research/studies and
inventions of machines and equipment for
domestic consumption
11. Develops entrepreneurial qualities and
positive attitudes among potential
entrepreneurs to bring about significant
changes in the rural areas
Who are the entrepreneurs?
 Entrepreneur is an innovator who…
… does new things and
does things in a new
way
…supplies new product
…makes new techniques in
production
…discovers new market
…develop new sources of
raw materials
 Entrepreneurs are those who launched
their own business from scratch, they
develop scarce resources into successful
business by their instinct, sense of timing
and hard work and ides producing activity.

 The entrepreneurs or the-would-be

entrepreneurs are extraordinary people
by virtue of their chosen career. They
possess qualities that distinguish them
from the ordinary business.
 Characteristics of an
entrepreneur
There are 10 characteristics identified and
defined by Mc Bear and Co. (1986) of a
successful entrepreneur:
1. Opportunity seeker
a. explores and acts on new business
opportunities
b. takes usual opportunities to obtain capital,
facilities, equipment, machineries and
government assistance
2. Persistent
a. formulates different alternatives to overcome
possible
problems that may
come along the way
a. makes personal sacrifices to see a job
completed according to specified standards

3. Committed to a work contract

a. assumes full responsibility for job orders of
customers
b. helps workers or acts as a substitute for
absent workers (if there is need) to get a job
done
c. conveys a concern for pleasing customers
4. Risk takers
a. makes an effort to evaluate advantages of a
business in which he/she would opt for a
modern risk
b. Open to untoward experience and considers
constraints as challenges

5. Competent and Hard worker

a. aspires and works towards quality
performance
b. does things that assures work that meets or
exceeds standards of excellence
6. Goal setter
a. formulates specific, measurable, attainable,
reliable and time-bounded objectives
b. formulates long term goals

7. Information Seeker
a. solicits information about clients,
competitors, suppliers.
b. Confers with experts about business or
technical advice
c. Established linkages to obtain important
information
8. Systematic Planner and Overseers
a. evolves and implements step by step plans
to reach goals
b. assesses options
c. observes performance and adapts
alternative strategies

9. Persuasive/Salesman
a. implements planned strategies to persuade
or convinced others
b. sells ideas to other people
c. uses business contacts to attain goals
10. Self-confident
a. possesses strong belief in self and in what
he/she accomplishes
b. has confidence in meeting problems and
challenges especially those that are related
to the business
 Personal Entrepreneurial
Competencies
As a result of continuous study of
entrepreneurial character traits, several
qualities were evolved by the Management
System International, a consulting firm based
in Washington. These are collectively called
personal entrepreneurial competencies
or PECS. They are referred to as
competencies because these qualities are
translated into actions – demonstrated and
exhibited – by an individual in order to make
things happen rather than remain as passive
traits or mere mental pre-occupation.
These competencies are clustered into the
following:

1. Achievement cluster
a. Opportunity seeking
b. Persistence
c. Commitment to work contact
d. Risk taking
e. Demand for efficiency and quality
2. Planning cluster
a. Goal setting
b. Information seeking
c. Systematic planning and monitoring

3. Power cluster
a. Persuasion and networking
b. Self-confidence
 Social and Economic Impact of
Entrepreneurship
 People have many physical needs. Basically, they
need food, clothing, shelter, air and water. In
addition, they also need other things like
transportation, bags, shoes, soap, salt and sugar,
medicine and many others.

 People living in the community are dependent

on each other for the products and service
each of them needs every day. This is so
because as the community grows, individual
roles become more distinct and specialized. It
is difficult for everyone to provide for
everything he needs.
A need for a product or service is an
economic opportunity. When people need
something they are willing to pay someone
who is able to provide it to them. The
ability of individuals to perceive the kind of
products or services that others need and
to deliver these at the right time, to the
right place, to the right people and at the
right price, is what is generally referred to
as entrepreneurship. When
entrepreneurship is a practice of many
members of a community or society, that
society develops very rapidly.
The following benefits that result from
entrepreneurship explain why
development takes place when a
society becomes entrepreneurial.
1. Entrepreneurship creates employment

When entrepreneurs put up a business,

they oftentimes need to hire or employ at
least one or two to hundreds of other
people in order to get something done.
When entrepreneurial activities slow
down, the country’s unemployment rate
goes up. Every society
wants all qualified members
of its work force to be
gainfully employed.
2. Entrepreneurship improves the
quality of life
Entrepreneurial undertakings
contribute significantly to the continuous
improvement of living standards. The
development of new products and the
delivery of needed services make life
easier and comfortable for society in
general.
3. Entrepreneurship contributes to
more equitable distribution of income
and therefore eases social unrest.
Entrepreneurs continuously search,
identify and/or develop raw materials
needed for the production of goods and
services. To them, nothing or almost nothing
is useless. They are, therefore, the ones who
often see the economic potentials of raw
materials and other resources in the rural
areas.
By putting up an enterprise in the locality,
entrepreneurs are actually dispersing the
benefits of development to other parts of
the country. When many segments of the
society are deprived, social tensions may
arise.
Income that is evenly distributed means
less poor people. The eradication of
poverty will help solve social problems like
crime, juvenile delinquency and
malnutrition.
4. Entrepreneurship utilizes and
mobilizes resources to make the
country productive
Our country will develop faster
economically if none of its resources were
idle or unused. For example, we have plenty
of iron ore that can be processes to supply
the needs of industries that manufacture
spare parts for cars and machines.
Putting up a metal factory to process iron
ore does not only utilize the raw materials
and feed other local industries. It also save
much for the country in terms of dollars and
time same local industries need no longer
be dependent on its iron-ore imports all the
time.
Entrepreneurship also provides a way to
make productive use of capital resources
such as family or personal savings.
Otherwise, these may remain utilized or
channeled to unproductive ventures
(gambling) or luxury spending.
5. Entrepreneurship brings social
benefits through the government.
With the revenues the government
collects from taxes, duties and licenses by the
entrepreneurs (not to mention income tax
the entrepreneurs’ workers pay) the
government allocates the disbursement of
these revenues to different services and
projects for communities.