COMPILED NOTES in ENTREPRENEURIAL MIND [Maria Antonnette B.

Gulilat, LPT]
LESSON 2 – ECONOMIC DEVELOPMENT OF ENTREPRENEURSHIP AND ITS COMPETENCE

“The Success of a person is eighty percent human interaction/attitude and twenty percent knowledge of the task/aptitude.”

LEARNING OUTCOMES
1. Describe the Philippine economic landscape in the present time
2. Explain the different factors in determining economic growth
3. Examine the contributory determinants in the making of an economy
4. Discuss the role of employment as a contributory factor in economic development
5. Explain entrepreneurship and socio-economic development

Philippine Economic Landscape in the Present Time

The Philippine Economic landscape remains to be the spring board of questions when economic development is the focused of discussion. The
leaders of this nation, aim greatness for the Filipino people especially during the time of election. Their honest intention of improving the economic
condition is their battle cries that catapulted them into power, yet in spite of the many promises Filipino remain poor. Instead of improving the living
condition of the Filipinos, they amassed wealth as a preparation for the next election. Politics becomes an investment for power and money and it is
not the true essence of public services. Two important factors hinder our growth as a nation:

1) Poverty is the making of its people and kind of leaders that holds the wheels of economic fortune.

Our country is still dominated by poverty and the unjust distribution of wealth. Income is in the hands of the few opportunists. Power is in
the hands of traditional and family politicians as they amass wealth through graft and corruption.

2) Population explosion is another factor that contributes to the poverty of our nation.

We cannot increase the size of the land that is cultivated by the farmers, yet his family size continues in number. Productivity in agriculture remains
the same through the years. Economic activities in the countryside remain in the hands of few entrepreneurs who take advantage in the marketing
of products to the urban center.

Factors in Determining Economic Growth

The following factors are contributory determinants to our slow growth in economic development as a nation:

1. The Filipino Values and Culture.

a. Love for imported products

The country’s colonization for centuries has developed in the Filipino culture of dependence and love for foreign products. We still feel that imported
products are superior in quality and we look our own products as inferior.

We love the taste of imported chocolates, the taste of apple rather than our local guava, the taste of grapes rather than local berries, and the love
for imported clothing rather made in the Philippines. Buying imported good develops the economy of the foreign countries and drains the Philippine
economy.

b. Our Values of BAHALA NA

A true Filipino entrepreneur will not put his destiny in the hands of the BATHALA. He must act with strong determination and push for the
development of his ideas. Innovation and the creation of more goods and services are in the hands of the entrepreneur who has the ability to make
new and innovative products or create a new channel of their distribution.

BAHALA NA is the concept of belief in BATHALA, the gods of the lazy of bones and undetermined individuals. Faith in GOD could be the driving
force of any entrepreneur to make things happen as he believes that his power to think and innovate comes from the true GOD that guides the
destiny of man.

c. Our Crab Mentality

Crab Mentality is the action of people to pull down other who are about to get out the verge of poverty and reach for their success. Enviousness is
the making of people who could not think better for himself. There are many of us who destroy other yet when we look at the mirror we are not
better than them.

This could be a clear example of Pedro opening a SARI-SARI store and JUAN opening the same king of business in the next corner. Thinking that
someone on the other corner is making good in selling barbeque or a LITSONG MANOK, he opens the same outlet not thinking that competition is
pulling down both of their profit. Why can we not think of anything better rather pulling the other fellow in this entrepreneurial activity?

d. The Manana Habit

“Mamaya Na” or “Bukas Na” is a culture that is brought to us by the colonizers who were fond of SIESTA after lunch time. We take time in stride
wasting time. The real entrepreneurs do not believe in siesta as they keep working until things are done to their plans.

Hard work and dedication are the qualities in the making of successful entrepreneurs. In all books and records of successful people that developed
economic fortune, we find in their economic dictionary that success carries with it love for work and time management. They would not keep any
work unfinished during the day. Persistence is a value that we have to develop to make our economy successful.

e. The Value of Time

Relative to the above discussion, is our lack of value to the precious time given to us, 24 hours a day and 364 days in a year. We are always late in
the start of the program, coming to our classes, attending to office work and even in important meetings and appointments. We take all the time in
our hands, not thinking that the meaning of progress rest in our value of this precious gift of time.

The Japanese, our Asian neighbor, are noted for their sense of value of time. They became successful because they are always on time. Meeting
with them is meeting on the dot or else you will not be able to get important business with them. Time wasted is opportunity lost in making a fortune.
Time is gold as the saying goes. Entrepreneurs get the golden opportunity as they do not lose time to make money and fortune.

f. Our Values of HIYA

HIYA could be a positive value in dealing with business condition. It could be a propelling reason for us to create batter service and proper dealings
in business transactions. There are still many of us who make shortcuts in business dealings. Good in its face value but with hidden agenda of fraud
and deception.

Tourism could be a haven for economic development if our people love to treat our visitors with HIYA of cheating them with taxi fares and services.
Our beautiful country is noted for hospitality, a value that may people of the world admire, yet many foreigners are afraid to go to our country
because there are still some of us who are acting WALANG HIYA.

Economic progress in the countryside and even in the urban centers could have come in if we have developed the basic services in education and
social development. Our political and social system have not developed the value of HIYA, as graft and corruption still exist because of our love for
material things, money, and power. Power is the hands of WALANG HIYA that amass the wealth of the people’s taxes which are supposed to
eliminate poverty, and development and improve education.

g. Fiesta and Social Occasions

The celebration of Fiestas of Saints that we inherited from the Spanish colonizers could be another factor in the slow development of our economy.
People especially in the country side would have all their savings spent in a day of the fiesta, entertaining guest, to find out the next day that there is
no more rice to feed their children.

The fattest pig is slaughtered and the best food is prepared and all the festivities are shown to the visitors. People will spend for the best clothes
and attend the coronation of the REYNA with all the fan fares of the local politicians who are attending and preparing for the coming election.

There could be nothing wrong with celebration as it is a part of happy Filipinos. The negative side, is the little money that we could spend
for more important business that would generate more profit in the long run. Spending money in birthdays, baptism, and other social occasions is no
means for an alarm but if we need to make loans with high interest rates, then that creates problem to our daily budget.

Economic progress and development are the making of all people but it must come from the top, the leaders of this nation. We need to harness or
talent and skills toward economic development. We, as a people, are not lazy. We are made the way we are because we have not changed our
values to a more positive system. Proper education could help us develop our values towards work and proper dealings with other people. Graft and
corruption should be taken out of the political and social system in the management of our people. It must start from us if we want this nation to
develop economically.

2. Job Opportunities/Employment

Employment opportunities remain to be elusive among Filipino. The industries in the economic zones and other urban centers could not
accommodate the growing employable people. Most still receive minimum wages that barely support the needs of five members of the family.

a. Employment is one great factor in economic development

The entrepreneur provides the necessary work for people that propel economic development of the nation. The money in circulation for wages and
salaries will help local industries to develop new products and services that generate more small and medium enterprise.

Contractual employment is till the name of the game in most factories as multinational corporations still take advantage of the low labor cost.
Workers are lured to this opportunity and there exist no better employment. The national labor laws still favor multinational interest for fear that they
will pull out their investment when better employment terms will be implemented.

There are some multinational corporations operating in the country with great concern for their employees who give them medical benefits and
better wages and terms of condition of employment. The government should look deeper into these firms and give them tax incentives that would
not necessarily reduce their taxes.

More regular employment also means more income taxes from employees. Economic factor along this area for the country could be two-tone
factors for the better services of those employed. Security of tenure will provide peace of mind among local employees to support their children’s
education.
b. Income opportunity in the countryside is still subsistence in nature

Most people are still dependent on Old farming and fishing system. We have not introduced modern farming technology and the proper
culture of our fishery resources. Our corals and fish sanctuary are damaged by destructive methods of fishing. Our vast shoreline could be
developed into haven for fishery development if new methods and technologies could have been put in place to supply the food of the nation.

MANILA is the dream paradise. The bright attracted dreamers of wealth and fortune that could be found at the end of the rainbow. Most
ended up to be squatters or the political correct term, informal urban settlers.

The theory that agriculture is an essential key to economic development must be pursued with vigor by the government and those people
in the rural setting. Agricultural productivity will minimize internal migration to urban centers. This could be an entrepreneurial venture in the
economic development of the countryside.

We need to introduce new technology to make farming productive with the introduction of new technology to improve irrigation, to improve
working condition, and to increase productivity of the farmers. Technology is one important factor in the development of the economy and
entrepreneurial activity.

3. Availability of Needed Capital

The banks are sources of limited capital for small and medium enterprises. These resources are available in the banking institutions. The poor
people are not aware of these great opportunities and they do not know how to go about it to avail of the funds. Below are the legality of this topic.

a. Republic Act 6977, known as the Magna Carta for Small Enterprise provides the necessary funds for the development of entrepreneurs
in the countryside.

Under this act, are small and medium enterprise engaged in industry, agribusiness, and other services. These funds could be availed by single
proprietorship, cooperatives, partnership or corporation.

In a small and medium enterprise whether engaged in industry, agribusiness

and/or services, whether single proprietorship, partnership, corporation or cooperative
whose total assets, inclusive of this arising from loans but exclusive of the land on which
the particular business entity’s office, plant and equipment are situated, must have value
falling under the following categories.
Micro Less than P150,000.00

Cottage P150,001.00 P1,500,000.00

Small P1,500,001.00 P15,000,000.00

Medium P15,000,001.00 P60,000,000.00

Large P60,000,001.00 above

Source p.19 Entrepreneurship and Small Business Management by Melina, R G.

2003

The intention of the law is to provide the promotion, growth and development of SMALL AND MEDIUM ENTERPRISES by assisting government
and RELEVANT AGENCIES (capitalize for emphasis) in tapping, local and foreign capital and the use of existing guarantee funds.

The Law of Small AND MEDIUM ENTERPRISES DEVELOPMET COUNCIL has some of the important powers that could develop the countryside
and those of the local enterprises described below:

1) To recommend to the President of the Philippines and Congress on policy matters affecting small and medium enterprises;
2) To coordinate and integrate various government and private sector activities relating to small and medium scale enterprises;
3) To monitor and determine the progress of various agencies geared towards the development of the sector;
4) To provide appropriate policy guidelines and coordinate frame work in assisting relevant government agencies in tapping of local and
foreign funds for small and medium enterprise;
5) To assist in the establishment of modern industrial estates outside the urban centers;
6) To promote the viability of small and medium enterprises by way of directing or assisting relevant government agencies in the national,
regional and provincial levels towards the following.

a) Technical training courses and those related to business operation, like simple accounting and bookkeeping;
 b) Labor and management relation and improve working condition. Product development and quality assurance and product
diversification;
c) Improve production techniques and the use of technology in production and the utilization of indigenous community resources and
raw materials;
d) Provision and assistance in the marketing and distribution of products;
e) Provide for concessional interest rates, lower financing fees, and incentives for prompt credit payments, as well as arrangement
tying amortization to business cash flows, effective substitution of government guarantor cover on loans for barrower’s lack of
collateral;
f) It provides for the setting of a RELIEF SYSTEM for distress enterprise as preventive bankruptcy measures and the setting up of
insurance against extraordinary disasters;
g) It provides for INTENSIVE INFORMATION CAMPAIGN and ENTREPRENEURIAL EDUCATION (the intension of which is to give
opportunity for all those with entrepreneurial talent and interest);
h) The law provides easier access and uses of tax credits and other tax and duty incentives as provided for in OMNIBUS investment
code and other laws;
i) Provision for product research and development and system of experimentation and access to information on commercial
technologies.

Republic Act No. 6810 is the establishing of Magna Cart for Countryside and Barangay Business Enterprise, granting exemptions from any
and ALL government rules and regulations and other incentives and benefits and for other purposes.

The important provisions of this ACT are the following:

1. To achieve development of countryside business enterprises in the BARANGAY level through the absence of BUREUCRATIC
RESTRICTIONS and granting of incentive and other benefits;
2. The number of employees should not be more than twenty (20) at any time of the purpose of undertaking a productive business
enterprise that will help the economy in the area;
3. The productive enterprise shall be principally engaged in the following activities:
a) Professional Service
b) Retailing
c) Wholesale or Trading of Commodities, Products, or Merchandise.

Base on the above discussions and the important provisions of the laws mentioned, entrepreneurial activities in the local levels and the
countryside have not developed when all the opportunities were provided by the government for local entrepreneurs. We remain to be poor and the
budding entrepreneurs continue to search for available finds to finance their enterprises.

Analysis of the prevailing conditions and the business laws that grant these incentives points to following failures in the implementation
program:

1. An honest political will to implement the program to develop the countryside and the local entrepreneur. Information dissemination falls to
cascade down to all sectors interested in the program.

2. Vested interest groups take advantage of the program by establishing NON GOVERNMENT AGENCIES in the disguise of helping the
lowly business sector but it turned out that it is for their benefit. The establishment financing agencies with interest rates that benefited
their organization. Some NGO’s lost interest after taking advantage of the government money and now they are nowhere to be found to
be persecuted for their acts of corruptions.

3. Banks and lending institutions required so many paper works beyond the comprehension of small businessmen who don’t have formal
training as provided for the law.

Entrepreneur and Socio-Economic Development

The development of the nation economic activity is the making of small and medium enterprises mostly located in the countryside. They contribute
to the economy of big corporations as they are also consumers of their production. It is the entrepreneur who develops new products and makes
innovation that becomes the backbone of more economies.

The following are the contributions of the Entrepreneur in out Socio-Economic Development:

1. The entrepreneur provides employment

Employment generates income and those employed pay taxes to the government which is turn gives benefits to the social
educational needs of the greater population. Those with income through employment become less burdensome to the government.

2. The entrepreneur pays taxes

Entrepreneur pays taxes in the form of estate tax, sales tax, import and export tax, and permits from the local and national
government.

Taxes collected from the entrepreneur pump up the development of better communities in terms of better road facilities, better
school buildings for the masses, and other social services. With the taxes paid the government could maintain better peace and order situation
as police and military personnel could better protect the people.
 3. The entrepreneur provides new lifestyle and pleasures
Product innovation and development is the making entrepreneurs. Mobile phones are the newest contribution of the entrepreneur to
make a new lifestyle for more Filipinos. Communication between individuals and business became so easy and handy as everyone enjoys new
innovations.

New technology like computers and other household convenience are the results of entrepreneurial geniuses that turned our life to
new lifestyle and pleasures. They provide life convenience beyond the imagination of man.

Entrepreneurs do not stop searching for better product and services.

4. The entrepreneur improves the capital base of the economy

The entrepreneur mobilizes economic activity as the circulation of money which pumps up the economic development of the
community. Capital investment generates profit. Profit, in return, is growth in investment base that will propel more business activities.

Entrepreneurs do not keep their money in the piggy banks or make this as idle deposit in banks. The greater money in circulation the
greater is the economic activity of the nation. More investment generates more employment opportunities for the people.

5. The entrepreneur creates people empowerment and social mobility

Entrepreneurs accumulate financial resources that give them social power in the community. They can afford to buy some personal
luxuries of life. They acquire new life style of travel and pleasure. They make new houses and invest in real properties that make them
respected in the community.

It empowers them to make decisions related to the wise use of money.

Their high income differentiates them from those employed as their life style become more diverse and complex. Empowerment
makes entrepreneur the idol of community for their innovation and hard work.

6. The entrepreneur provides healthy competition

Healthy competition provides people with choices of new products or better services. Entrepreneur seeks better products and
develops new ones that will satisfy their target customers. Competition develops pride for the entrepreneur that their product or service is
superior from the other.

The entrepreneurial ego of human superiority in the development of new product or service drives the entrepreneur to more
innovation and development hence, the greater goods cascade down to the consumer who wants new products and services.

Managerial Skills That Makes a Successful Entrepreneur

Being hardworking and industrious are no guarantee in the making of business activities while they play and important role in the success
of the enterprise. While many successful entrepreneurs have not gone to business schools to acquire managerial theories in the management of the
enterprise, they have developed managerial skills through share observation, or an inherent leadership ability and intelligence.

The entrepreneur has the following managerial skills:

1) The ability to plan and conceptualize

Conceptualization and planning go together. Good concepts need to be put in the planning table to avoid the risk factor. The entrepreneur
is able to forecast the future be seeing to it that the risk involve are properly controlled.

He must be able to visualize the direction of the business towards successful takeoff. He must see that the product or service, the pricing
strategies, the cost of production, and the inventory will generate reasonable profit and return of investment. The take off point of any business is
the generation of profit based on plans and programs.

2) The ability to organize the resources of the enterprise

A good business organization is based on around people and resources. An entrepreneur works with others and needs people with the same
values and working ability. Efficiency and effectiveness in the work arena are the working of people with dedication and talent to do the job properly.

The material and physical resources must be put in place. Waste of time and money has no place in a good organization. The entrepreneur must
be able to give specific directions and work activities that will redound to efficient delivery of the necessary services to customers and clients.

3) The ability to direct and motivate people in his organization

People are like machines that need oil that make them work smoothly and efficiently and effectively. Machines will bug down if no oil is
put into its chamber while in operation. The same principles work with people. They need proper compensation and motivation for them to deliver
the necessary output.

Compensation and benefits are no guarantee for effective performance while it may serve as important ingredients. The entrepreneur must be able
to communicate ideas and plans to his subordinates with the sense of humility. Good communications and human relations will drive people to be
motivated to perform their task and pride.

4) The ability to control

Controlling the whole operation is a difficult task for entrepreneur. Safeguards and control mechanism could put in place with carefully crafted
policies and procedures. Such policies and procedures must be carefully disseminated and understood by all who will implement them.
 In the implementation stage, check valves through monitoring and feedbacks mechanism must be worked out through reports and at times
conference with key people. The progress of operation and other activities related to finance and marketing must generate the necessary reports as
bases for more plans and actions. Controlling cost and non-essential expenses will save import profit that could be invested in profitable operations.

5) The ability to manage time

Time management is very essential ingredient to the success of an entrepreneur. Because of the numerous activities to attend to the entrepreneur
must be able to log on his time schedule so that important activities could be attended on time.

Meetings and conferences occupy most of the time of entrepreneurs. They must be scheduled properly that they will not complicate with important
paper works in the office.

Some entrepreneurs who burn themselves out with stress die early and do not see the fruits of their labor. They must have schedule for his family,
his religion and enjoy some personal pleasure that will eliminate the stressful task of managing his business.

6) The ability to adapt to the changing environment of business

Business today is fast changing with the advent of technology and innovations. The new entrepreneur must be able to adapt to this changes in the
business landscape for him to go with the time of progress and expansion.

Consumers’ taste and preferences are gradually changing to better quality products and services. Competition is shifting to more affordable quality
products and entrepreneur must be aware of this changing customer demand. Changes are applicable adaptability should be given attention to gain
continuous customer patronage.

While the above discussions are the theories and elements of good management, an entrepreneur without formal training should attend seminars
and advance schooling to get further into the realms of better management theories that will help in the operation of the enterprise. Learning is not
the sole property of those in school. Reading and attending various management interventions would make a great difference.

The entrepreneur, before launching into the field of business, must look forward to the challenges of the entrepreneurial life. The decision to go into
the business requires not only investment in money and time but hard work and intelligence in order to succeed. The positive qualities of the
individual are needed to start an investment.

Characteristics of an Entrepreneur

1) Leadership and management abilities

Managerial Leadership is the ability to plan, organize, direct and control the organizational towards the goals and objectives of the organization. It
requires conceptual skills in defining the direction of the business and the development of plans and programs that will work effectively. The mission
and vision of the organization must be set up based on his investment and interest.

The human skill deals with how the leader will relate himself with the people around him and those that he will encounter in the course of his
business. Managers must treat their workers with dignity and honor. They are aware of their needs and problems and workers are treated as
partners in the growth of his organization. Leaders motivate people to excel in their respective field and pay them commensurately with their
efficiency and performance on the job.

2) Positive risk takers

The entrepreneur as a positive risk take, enjoys the challenging of putting his money and time into the test. He calculated the various alternatives
open to him and careful in the choice of actions. They entrepreneur gathers complete data and makes careful analysis before making decisions.

The entrepreneur makes things happen rather than wait for the things to happen. They look at opportunities and make immediate actions before
others plunge into the business venture. They are confident in their intelligence and abilities and optimistic that results will be positive.

3) Self-confidence and positive outlook

The entrepreneur has strong belief in his capacity to make difference in their chosen field. They believe that achievements are guiding principles in
man’s success as faith drives them to do better. The entrepreneur believes in the Lord Almighty and that his talents are God given gift that he must
use for the well-being of mankind. His faith in God drives him to work with great enthusiasm and perseverance to reach his target goals.

The entrepreneur looks at the bright side of the business. Threats are converted into opportunities and he thinks of successes rather than failures.
Positive outlook generates profit and money that makes him richer. The poor becomes poorer because they do not think of how to make money.
They put their destiny to the BATHALA or the BAHALA NA attitude as tomorrow is another day. The entrepreneur thinks of how to make money.

4) Innovativeness and forward looking

The blazing path to entrepreneurial success is the courage to make innovations in products or service. The entrepreneur refuses to stop at his
achievements. He looks forward in creating new things, something different from others. He thinks of new technology that will create new and better
things for the customers. He introduces innovations that will satisfy human needs and wants. He satisfies new market demand for new and better
products.

5) Natural intelligence and decision making skills

 The entrepreneur’s natural intelligence is an important requirement in making effective decisions. The entrepreneur has to make decisions as he
cannot make things happen without making a wise choice of alternatives. Creativity and innovativeness carry with it the power to make decisions as
he needs to satisfy customer needs for new and better products and service.

The success of any business venture rests with good decisions. The entrepreneur has to increase market demand. The customers’ wants and
needs for better product changes over time and the entrepreneur has to make decisions that would fit in in this market demand. The entrepreneur
has to follow a logical process in making decisions.

Characteristics of Entrepreneur
1. Facilitating Character – an entrepreneur must build a team, keep it motivated, and provide an environment for individual growth and
career development.
2. Self-Confidence – entrepreneurs must have belief in themselves and the ability to achieve their goals.
3. Work with Vision and Mission – an entrepreneur must be committed to the project with a time horizon of five to seven years. No ninety-
day wonders are allowed.
4. High Degree of Endurance – success of an entrepreneur demands the ability to work long hours for sustained period of time.
5. Trouble Shooting Nature – an entrepreneur must have an intense desire to complete task or solve a problem. Creativity is an essential
ingredient.
6. Initiative and Enterprising Personality – an entrepreneur must have initiative, accepting personal responsibility for actions, and above all
make good use of resources.
7. Goal Setter – an entrepreneur must be able to set challenging but realistic goals.
8. Calculated Risk-Taking Ability – an entrepreneur must be a moderate risk-taker and learn from any failures.

Types of Entrepreneurs
Entrepreneurs are classified as under different heads as given below. This helps the potential entrepreneurs to choose his own nature
and style of entrepreneurship.

According to the Type of Business

Entrepreneurs are found in various types of business occupations of varying size. We may broadly classify them as follows:

1) Business Entrepreneur
Business entrepreneurs are individuals who conceive an idea for a new product or service and then create a business to materialize their
idea into reality. They tap both production and marketing resources in their search to develop a new business opportunity. They may set up a
big establishment or a small business unit. Trading entrepreneur is one who undertakes trading activities and is not concerned with the
manufacturing work. He identifies potential markets, stimulates demand for his product line and creates a desire and interest among buyers to
go in for his product. He is engaged in both domestic and overseas trade.

2) Industrial Entrepreneur
Industrial entrepreneur is essentially a manufacturer who identifies the potential needs of customers and tailors’ product or service to
meet the marketing needs. He is a product oriented man who starts in an industrial unit because of the possibility of making some new
product.

3) Corporate Entrepreneur
Corporate entrepreneur is a person who demonstrates his innovative skill in organizing and managing a corporate undertaking. A
corporate undertaking is a form of business organization which is registered under some statute or Act which gives it a separate legal entity.

4) Agricultural Entrepreneur
Agricultural entrepreneurs are those entrepreneurs who undertake such agricultural activities as raising and marketing of crops, fertilizers
and other inputs of agriculture.

5) Technical Entrepreneur
A technical entrepreneur is essentially an entrepreneur of “Craftsman type”. He develops a new and improved quality of goods because
of his craftsmanship. He concentrates more on production than marketing. He does not care much to generate sales by applying various sales
promotional techniques. He demonstrates his innovative capabilities in matters of production of goods and rendering services.

6) Non-technical Entrepreneur
Non-technical entrepreneurs are those who are not concerned with the technical aspects of the product in which they deal. They are
concerned only with developing alternative marketing and distribution strategies to promote their business.

7) Professional Entrepreneur
Professional entrepreneur is a person who is interested in establishing a business but does not have interest in managing or operating it
once it is established.

According to Motivation
Motivation is the force that influences the efforts of the entrepreneur to achieve his objectives. An entrepreneur is motivated to achieve or prove
his excellence in job performance. He is also motivated to influence others by demonstrating his power thus satisfying his ego.

1) Pure Entrepreneur
A pure entrepreneur is an individual who is motivated by psychological and economic rewards. He undertakes an entrepreneurial activity
for his personal satisfaction in work, ego or status.

2) Induced Entrepreneur
 Induced entrepreneur is one who is being induced to take up an entrepreneurial task due to the policy measures of the government that
provides assistance, incentives, concessions and necessary overhead facilities to start a venture. Most of the entrepreneurs are induced
entrepreneurs who enter business due to financial, technical and several other provided to them by the state agencies to promote
entrepreneurship.

3) Motivated Entrepreneur
New entrepreneurs are motivated by the desire for self-fulfillment. They come into being because of the possibility of making and
marketing some new product for the use of consumers. If the product is developed to a saleable stage, the entrepreneur is further motivated by
reward in terms of profit and enlarged customer network.

4) Spontaneous Entrepreneur
These entrepreneurs start their business out of their natural talents and instinct. They are persons with initiative, boldness and confidence
in their ability which motivate them to undertake entrepreneurial activity.

5) Growth Entrepreneur
Growth entrepreneurs are those who necessarily take up a high growth industry. These entrepreneurs choose an industry which has
substantial growth prospects.

6) Super-Growth Entrepreneur
Super-growth entrepreneur are those who have shown enormous growth of performance in their venture. The growth performance is
identified by the liquidity of funds, profitability and gearing.

According to Stages of Development

1) First-Generation Entrepreneur
A first generation entrepreneur is one who starts an industrial unit by means of an innovative skill. He is essentially an innovator,
combining different technologies to produce a marketable product or service.
2) Modern Entrepreneur
A modern entrepreneur is one who undertakes those ventures which go well along with the changing demand in the market.
They undertake those ventures which suit the current marketing needs.

3) Classical Entrepreneur
A classical entrepreneur is one who is concerned with the customers and marketing needs through the development of a self-
supporting venture. He is a stereotype entrepreneur whose aim is to maximize his economic returns at a level consistent with the survival
of the firm with or without an element of growth.

4) Innovating Entrepreneurs
Innovating entrepreneurship is characterized by aggressive assemblage of information and analysis of results, deriving from a
novel combination of factors. Men/women in this group are generally aggressive in experimentation who exhibit cleverness in putting
attractive possibilities into practice. One need not invent but convert even old established products or services, by changing their utility,
their value, their economic characteristics, into something new, attractive and utilitarian. Therein lies the key to their phenomenal success.
Such an entrepreneur is one who sees the opportunity for introducing a new technique of production process or a new commodity or a
new market or a new service or even reorganization of an existing enterprise.

Imitative Entrepreneurs:
Imitative entrepreneurship is characterized by readiness to adopt successful innovations by innovating entrepreneurs. They first
imitate techniques and technology innovated by others.

5) Fabian Entrepreneurs
These categories of entrepreneurs are basically running their venture on the basis of conventions and customary practices.
They don’t want to introduce change and not interested in coping with changes in environment. They have all sorts of inhibitions, shyness
and lethargic attitude. They are basically risk averse or and more cautious in their approach.

6) Drone Entrepreneurs
Entrepreneurs who are reluctant to introduce any changes in their production methods, processes and follow their own
traditional style of operations. Though they incur losses and loses their market potential, will not take any effort to overcome the problem.
Their products and the firm will get natural death and knockout.

7) Forced Entrepreneurs
Sometimes, circumstances made many persons to become entrepreneurs. They do not have any plan, forward looking and
business aptitude. To mitigate the situational problem, they are forced to plunge into entrepreneurial venture. Most of the may not be
successful in this category due to lack of training and exposure.

The Decision Making Process:

a) Identify the problem

The risk involved in the management of the business has to be identified and analyzed before the solution could be made. Relevant data and
information must be organized. The core objectives are to minimize the risk factors involved as wrong choice of alternative would result to
production or operation losses.

b) Gather the data that brought the problem

Good and intelligent entrepreneur must be able to get the data that brought about the problem. The solution to the problems is dependent on the
data available at hand. Correct information would give better solutions. False and irrelevant data would give the best solutions.
 c) Analyze the data
Not all information is relevant to the solution of the problem. Some data must be discarded. The data must focus on the problem at the hand. It
must be timely gathered and the information is based on the actual situations prevailing in the business environment. The internal and external
sources must be analyzed to find out which are relevant in formulating alternatives solutions.

d) Formulating alternative solutions

The entrepreneur makes various alternative solutions to the problem at hand. These solutions are subject to a series of analysis and he may need
outside opinion. He may subject the alternatives to further study before making decisions until he finds the right alternative course of actions.

e) Selecting the best alternatives course of action

After all the alternative courses of action had been analyzed, the entrepreneur makes the decision. The decision has to be implemented with the
less possible risks in terms of money, time, and effort. It must take into account the available manpower and material resources, supported with
financial logistics.

f) Implementing the best alternatives

The modern entrepreneur utilizes group efforts in solving business problems. Problems and Solutions are best arrived when people who will be
implementing the decisions are properly consulted and their opinions and ideas are taken into account before the final decision is implemented.
Group effort is required in planning effective for implementation.

Organizing The Business Enterprise

The prospective entrepreneur before going into the intricate field of the business world should first go into deep analysis of their personal and social
attitudes. It is not only material assets but personal values and characteristics. Before venturing into the field of business, it is wise to develop
entrepreneurial studies that will help determine the feasibility of the project.

Some entrepreneurs failed because they are “plain copy cats” in putting the business because the neighbor Juan makes money going into a Mini-
grocery. The entrepreneur must first evaluate his personal interest, experience in the chosen field, the technical skills as well as human skills as
these are the vital component in the success of the business.

Business forecasting and planning skill is another vital component that must be addressed before making investments. Careful preparation is an
essential factor in setting the enterprise into motion. Investment in money and effort may go to waste without adequate preparation and careful
planning. The loss of money and time must be prevented.

Entrepreneurial Studies

The entrepreneur must see for himself the kind of management control and how the business will be able to generate his projected profitable
investment. He sees the wide open market of opportunities and the possible problems before he plunges into the intricate operation of the
enterprise. Wise investment through a careful analysis of the business environment would minimize business failures.

The following steps in the business formation have been done by entrepreneurs that applied a more scientific study of the business condition. A
business project wither or an expansion, undertake a careful panning of the project which will serve a guide in the implementation.

Case 2 – Marian’s Organization: A Chaotic One

It was in November 2020 when Miss Marian Rivero, a business management graduate, opened her store “Marian’s Sales” in downtown
Caloocan City as an exclusive dealer of shoes products of Parisiane in MS City. After a few days, she hired a 16-year old boy to help her in the
various manual tasks in the factory.

The five percent profit margin she attached to the cost of sales on items she was handing provided enough reason for consumers to
patronize her factory. The increasing volume of sales justified her hiring a sales assistant after five months of operation. By February 2021, her
factory was attended by 10 workers plus the helpers and the teenage help.

Presently, Miss Rivero is performing the following functions:

1. Purchasing merchandise’ stocks outside the town;
2. Accounting;
 3. Supervising sales activities
4. Cashiering and treasury;
5. Supervising inventory control

By December 2021, her factory sales reached an average of P1.5 million per month on a P3.5 million net worth. Her customer comes
from Pampanga and the nearby towns of Pangasinan and others.

Marian realized that her sales were limited only by her ability to serve more customers. She felt that if she could only expand her network,
it would be more successful. She is considering putting up a branch in San Carlos City and another one in Lingayen.

Her biggest problem now is how to set an organizational structure that will match her expansion plans. Could you please help her? (Source:
Entrepreneurial Management by Marife Acierto (2019) pp. 21 – 37)

COMPILED NOTES in ENTREPRENEURIAL MIND [Maria Antonnette B. Gulilat, LPT]

LESSON 1 - CONCEPT OF ENTREPRENEURSHIP

LEARNING OUTCOMES:
 1. Understand the concepts of entrepreneurship, its need and scope
2. Describe the key concepts in the making of an entrepreneur
3. Develop the skills important in entrepreneurship
4. Identify the factors that develop entrepreneurial activities and success
5. Elaborate the making of a Filipino entrepreneur and their profile

“Opportunity comes from one person’s idea that influences others to take action”

Entrepreneurship
• It is a science of converting processed ideas into a remarkable business venture
• It is also a capacity for innovation, investment, and expansion in new market, product and techniques (Fajardo:2009)
• Implies that an enterprise is at work whenever an individual takes the risks and invests resources to make something unique or
something new, designs a new way of making something that already exists, or creates new markets.
• It refers to all those activities which are to be carried out by a person to establish and to run the business enterprises in accordance with
the changing social, political and economic environments.
• It includes activities relating to the anticipation of the consumers likes and dislikes, feelings and behaviors, tastes and fashions and the
introduction of business ventures to meet out all these expectations of the consumers.

The Entrepreneur

• An entrepreneur is an individual who is alert to profitable opportunities for the exchange of goods or services.
- A street vendor in Divisoria takes the opportunity to make profit by selling school supplies during the opening of the school.
- During Christmas, He or she takes the opportunity of selling Christmas items and in other occasions, sell clothing apparels at
different seasons.
- A cell-phone repair man takes the opportunity of serving various cellular owners who cannot afford to buy new models.

• An entrepreneur is one who organizes, manages, directs and assumes the risks of a business or enterprise. Being an entrepreneur is a
lifestyle or an attitude. It is not a calling for everyone, but rather a choice.

Quick Self – Assessment: These fifteen (15) questions that a potential entrepreneur must ask himself or herself
before setting up a new business a Yes or No answer is
highly recommended.

1) Am I a planner, dreamer or a goal setter?

2) Do I offer a product that people want to buy?
3) Do I have enough resources to start the business?
4) Will my business plan allow cash to flow as soon as possible?
5) Am I working around a tight budget for my expenses?
6) Do I have good credit status?
7) Am I expecting too much from my revenue as a result of my hard work?
8) Am I ready to assess and measure everything before putting it out for the public?
9) Do I have strong people skills?
10) Do I enjoy making decisions and being in charge?
11) Am I good at short and long-range planning?
12) Am I willing to take initiative when confronted with different situations?
13) Am I flexible, and can adapt to changing circumstances?
14) Am I willing to take calculated risks?
15) Am I ready to learn and accept mistakes that I might encounter along the way?
Interpretation:
- If you could answer yes to most of the questions, then you are probably ready to become an entrepreneur.
- There are no correct answers for the questions regardless of your answer.
- These are some of the basic realities that you must face starting the business:
demand for your product or service, cash flow, income potential, marketability, and flexibility.
- Be proud to navigate the road to entrepreneurship and hurdle the challenges and roadblocks along the way.

The entrepreneurial skills and competencies

 • The entrepreneurial skills and competency factors are the following: negotiating, planning, risk assessment, purchasing, accounting,
recruitment, and training, selling, controlling, and dealing with emergencies.

The entrepreneurial as a Missionary

• The entrepreneur is a missionary who perceives opportunities inherent in the exchange of goods with great desire for profit.
• The entrepreneur creates an environmental in which success is possible and the possibility if failure is controllable.
• The entrepreneur is at work whenever he takes risk and invests his personal talents and resources to make something or different as
customers like to buy new and improve products.

Entrepreneur is Goal-Driven

• An entrepreneur is goal-driven and self-confident as he exercises the locus of control.

• He sets high goals and strives to attain the projected target and accomplishments.
• He extracts compliance with set goals and activities to avoid the risk he foresees while planning the activities and programs in the
operation of the enterprise.
• He accepts challenges and responsibility for results.
• He makes sure that people work based on specified work programs and schedules.

The Entrepreneur is a Marketing Man

• The marketing environment is identified by the entrepreneur and thus, he marshals his resources to pursue the opportunities and makes
immediate action to exploit his personal gain.
• The needs and wants of costumers are properly identifies and these are propelling reason for him to take the opportunity to make profit.
• He takes the lead for innovation and makes modifications to make the costumer aware that his product or service is more superior to
those offered by others.

The Entrepreneur Starts Small to Become Big

• Many entrepreneurs start small but with their managerial talents and persistence, they exploit the opportunities available for their
disposal.
• At the early stage, their growth orientation is for expansion of their operation and they persistently pursue approaches that differentiate
them from other managers.

The Making of an Entrepreneur

• The making of an entrepreneur is a dynamic process and an approach.

• As an approach, the entrepreneur considers the business opportunity as a chance to find new ways to solve the problem rather solving
the problem.
• A manager of an organization is characterized as an adapter while the character of an entrepreneur is an innovator.
• The manager employs discipline and precise methodical approach in solving business problems and make new avenues for its solutions.
• Entrepreneurship is a process that can be developed, learned and nurtured.

Entrepreneurship as a Dynamic Process

• Entrepreneurship is a dynamic process of innovation and the establishment of new opportunity for the creation of new venture.
• The small business owner entrepreneur in the sense is self-employed and is different from an innovator entrepreneur.
• The real entrepreneur is an individual with the greatest drive for expansion and growth and has propensity to make a difference in terms
of their achievements in profit and exploitation of the resources for growth and business expansions.
• The entrepreneur develops strategic plans and programs that will ascertain a definite advantage over the others in their line of business.
This is the reason why we see people in the same line of business that others had gone miles over the others. The former is a manager
of his business while the latter is an entrepreneur.

Factors That Develop Entrepreneurial Activities

1) The Entrepreneur Takes the Initiative

With his great interest to capitalize on the opportunity at hand, the entrepreneur takes the initiative of venturing into business. With an amount of
knowledge, he knows that he can operate the venture with minimum risk. Armed with vigour and vitality, he plunges a profitable operation.

2) Organization of Capital Resources

While talents and ambitions are great resources of the entrepreneur, financial, and human resources are important ingredients in the start of the
organization. With his savings and other financial resources, he starts operation on small scale together with his trusted family members or friends
he knew that could help him develop his dream enterprise.

3) The Development of Administrative Machinery

 The management is developed with organizational structure based on the need of operation. Specific duties and responsibilities are assigned to
individuals with talents and skills that fit their respective position. It is based on the individual capacity to do the job and not on personal connection
with the entrepreneur.

4) The Development of Entrepreneurial Autonomy

The entrepreneur develops autonomy in the operation of the enterprise as he takes the lead in all activities of the organization especially in the
early stage of operation. His venture capitalized as he knows the best the direction of the enterprise as he is aware of the calculated risk involved.
Locus of cost control must be in his hands.

5) The Development of SWOT Analysis

The avoidance of risk can be taken with careful analysis of the Strengths, Weaknesses, Opportunities, and Threats of the organization. The
entrepreneur must see the environment of the enterprise based on SWOT analysis so that the risk involve could be seen before it happens.
Forecasting environment events are antidote to future business risk.

Peculiar Characteristics of Managers in Solving Problems

1) He develops systems and procedures that are precise based on current practices in an industry.
2) The manager is interested in solving organizational problems rather than finding other avenues in the solution of the problems.
3) The manager calibrates in the refinement of policies and procedures and tends to revise them to solve existing problems.
4) He finds ways and means to provide solutions and compliance to routine activities.
5) He is interested in details and sensitive to group cohesion and extract group cooperation as a means to group accomplishments.

Characteristics of an Innovator Entrepreneur in Solving Problems

1) He looks at the problem on different angles and finds means to circumvent the same.
2) He discovers the roots of the problems and develops avenues to better solve the problem. He formulates solutions and alternatives.
3) He develops basic assumptions and hypothesis related to current practices and makes innovations based on careful analysis through
SWOT.
4) The innovator entrepreneur is interested in the end results rather than the means to achieve it. He has little tolerance for details and
routine work.
5) He capitalizes on people with bright ideas and talents and gets their opinions and consensus and with little regard for people with
mediocre ideas.

The Development of Entrepreneurship

The Making of a Filipino Entrepreneur

The making of a Filipino entrepreneur is a process of trial and error. The colonization of Filipino for more than 300 years is a great factor in the slow
development of entrepreneurial activity in the country. Our concept of owning a small business like a sari-sari store, or a small tailoring shop, or a
repair shop or market distribution outlet makes the person an entrepreneur. While this concept is true to certain extent, entrepreneurship is more
than being self-employed and making a living out of the meagre income to support family needs or a little of their wants.

The success of Filipino entrepreneur stands in a very shallow foundation. Most Filipino business starts on a copy-cat syndrome. For example,
Maria will start a sari-sari store and here comes Pedro seeing the flourishing business of Maria, opens store opposite the other corner. Juana starts
barbeque stand on the corner of Petra with another outlet offering another variety of street food. This is the scenery in most Philippine business
condition.

The food business outlet is one of the most abused and most prominent activities of some Filipino business entrepreneurs, including that of small
outlet in the distribution of basic grocery and other items called sari-sari store in some cases mini stores. Some enterprising outlets include cellular
phone load that adds to their income.

The Making of Jollibee Foods’ Corporation

The true Filipino entrepreneur is more than of a copycat. While we consider the success of Jollibee Corporation in the food industry, the founder is
not a true Filipino in strict sense of his origin. He has Chinse blood which, he inherited his business acumen form his parents who knew how
business should grow and prosper.

He starts with an ice cream stand and later made it into an outlet for chicken joy and other food items that answer the Filipino bids especially for
chicken. His success was based on his talent and innovation and finding a business that make him a multi-millionaire.

The Foundation of National Bookstore

The making of National Bookstore is not a myth of fortune and honey. The founder, Socorro Ramos, came from a poor family who sustained living
from selling various items to support their basic needs. She was a working student while in high school but because of her persistence and
perseverance, she graduated with honors. Being a working student was not a hindrance to her education as she painstakingly combined studies
with hard work.

After high school, she worked as a sales clerk in Goodwill Bookstore owned by her brother where she learned the rudiments of book business.
Learning the hard way is not easy task and starting a business empire of national magnitude which more than 30 branches all throughout the
country was a product of entrepreneurial acumen coupled with determination and hard work.

Business capital for expansion could come from savings and other resources. The Ramos couple knew that they could expand their business with
the savings that they had and brought the present office of the store at Rizal Avenue in Santa Cruz, Manila where a 9-story edifice was built. They
built a building complex in Pasig where printing and other services are being made.
 With the help of their children, they went into vertical expansion by establishing printing press to print local books and other office forms and
supplies. The ventured on other business activities and expand horizontally and vertically and made them of what they are today. Their children
were trained the same hard way and they are all successful, fitted to inherit the new growing business empire.

Leonardo Sarao, The Jeepney King

The success of the jeepney business is the making of a Filipino entrepreneur. Sarao jeepneys abound in all terminals during the early period of
transport development in the country until copy-cats made jeepneys of similar styles. Leonardo Sarao, the jeepney king, started the business by
being a helper mechanic until he established his repair shop from a meagre capital.

He then started buying second hand parts and engines from Japan and built jeepneys that abound in most streets of the Metropolitan Manila and
its suburbs. He established the jeepney factory with meagre capital and made savings to expand his operations. He ventured into other business
activities and success was not based on his education but hard work and determination. All his children became professionals and are now
engaged in various business activities that made them of what they are today.

The mentioned few successful stories of Filipino entrepreneurs will serve as a selfpropelling reason for us to think that the making of
entrepreneurship is not served in silver platter. The career of these few successful entrepreneurs were built with entrepreneurial genius founded on
slow painstaking hard work. Their personal objective is not only to generate money to sustain needs or wants but the greater drive for personal
fulfilment.

The Challenges for Entrepreneurship

The new generation of young entrepreneurs should look up the high standard of values and character of entrepreneurs who got up the ladder of
success. Success in entrepreneurial activity is based on the inner compulsion to achieve the undeterred difficulties. The values and character of
JUAN TAMAD has no place in the world of entrepreneurial vocabulary.

1) The new entrepreneur must be a doer and willing to work hard until achieves the task he wants for himself. He must possess the versatility for
success and self-confidence that could be overcome risk with his strong determination. The exploration of the total business environment must
be put into total perspective as it interplays with the development of new opportunities and the risk attached to it.

2) Personal attention and comprehensive awareness for the progress of the business is not trusted on other people. The entrepreneurship must
be in direct control of operation and not in indirect control. He must be able to measure the desired results. He must personally verify the data
and financial figures spent and earned in the operation of the business.

3) The new entrepreneur must have high sense of integrity that he stands firm on his principles and ideas. His word of wisdom is a contract to
depend on. He looks at things in different perspectives and approaches things with varied alternatives to attain what he wants. In short, he is
visionary, innovative and unstoppable until he achieves the goal sets for himself.

4) Emotional stability is an important factor in the making of an entrepreneur. While he is impatient for mediocre performance and lazy bones, his
temper must remain in control. Interpersonal relationships must be the banner in negotiations and effective personal communication is the key
factor in closing business deals.

5) The built in self-starting mechanism that drives an entrepreneur to success is his executive ability to manage people and resources. This
executive ability refers to how he plans, organizes, directs and controls the physical and material resources under his disposal. Many
entrepreneurs are describing to have shrewd judgment in character that induced them to see thing the way it should be. An entrepreneur has a
passion for excellences and mediocre performance has no place in his entrepreneurial vocabulary.

The new entrepreneurs and those who believe in their capacity for long hours of work to get things spend 75 percent in planning innovations and
putting them into action. Dreams are built around creativity as he conceived original idea out of his imagination.

The entrepreneur is like a multi-awarded artist with a handful of trophy of accomplishment equipped with inner drive in transforming idea into
tangible reality. Sacrifice for long working hours and abandonment of personal life pleasures make the entrepreneur achieve their target goals. They
organize and develop their ideas into achievable activities and surpass the factor of risk.

Mindset: Its Characteristics and Essentials

A mindset is a belief that qualities like intelligence and talent are fixed or changeable traits. The word mindset was coined by Carol Dweck
in her book "Mindset". It was based from her research about personalities of successful people. She found out that successful people have different
mindsets which are a fixed versus growth mindset.

In reality, there are numerous mindsets, but fixed and growth mindsets are her important discoveries for people living in today's fast
changing and very complex world.

Take the example of abundance versus scarcity as an example of mindset. A mindset of abundance will consider that there is plenty of
resources for everyone and that resources will not run out because they are replaceable. However, a mindset of scarcity shall think that there is
inadequate amount of things around, so some people can either benefit or lose them.

People with a fixed mindset perceive that their talents and abilities are set. They consider their brains and talents are sufficient to become
successful and endure life by becoming smart. They personally take positive criticisms of their capabilities. A fixed mindset sees the world in an
"either/or" perspective. For people with fixed mindset success is based on luck or possibly from some sort of prejudicial advantage. They always
want to avoid challenge, failure and tell themselves they do not have expertise. People with a fixed mindset believe that these qualities are inborn,
fixed, and unchangeable.
 On the other hand, people with a growth mindset trusts that traits can be changed, developed and strengthened by working on them.
These people are certain that their abilities could be developed by commitment, determination and obviously hard work. For them, brains and talent
are simply the starting point of the lifelong success of everyone. People with growth mindset see failure as an opportunity to enhance their
performance and take mistakes as lessons. Instead of giving up, they proceed to what they wanted to do despite failures.

Fixed Mindset Growth Mindset

I'm either good at it, or I'm not. I can learn anything I want to.
When I'm frustrated, I give up. When I'm frustrated, I persevere.
I don't like to be challenged. I want to challenge myself.
When I fail, I'm no good. When I fail, I learn.
Tell me I'm smart. Tell me I try hard.
If you succeed, I feel threatened. If you succeed, I'm inspired.
My abilities determine everything. My effort and attitude determine everything.

Characteristics of an Entrepreneurial Mindset

Entrepreneurship is a challenging and rewarding path. Based on research there is no distinct set of traits signifying success. Although,
there are several characteristics often common to successful entrepreneurs.

1. Curiosity - Being curious is really shared among successful entrepreneurs. Curiosity leads to questions, and questions lead to answers.
This trait strengthens the ability to understand things with a new standpoint. Nobody really knows everything, and curious people are
conscious of this. Being humble and open-minded lead to greater knowledge, and greater knowledge allows more detailed reflection.
2. Commitment - This is continuing to keep going and persist amidst problems. Rejection and disappointments are essential elements of an
entrepreneur's life which needs to be endured. Lessons must be taken from rejection and should not affect the confidence of an
entrepreneur. The focus should be on achievements, because it would motivate the entrepreneur to persevere as he moves forward and
continues to harvest good outcomes.

3. Optimism - Tough attitude towards challenges makes up successful entrepreneurs. Every time a situation happens, the entrepreneur
should be hopeful in exploring its many learning opportunities. For a successful entrepreneur, there is always a solution to every problem.

4. Flexibility - Entrepreneurship is a challenging field with its unpredicted demands and continuous problems. It helps to be supple to deal
with a series of difficult situations, solve problems easily and make progress from obstacles. A successful entrepreneur usually makes a
journal and timeline to overcome this difficulty.

5. Ownership - Successful entrepreneurs always trust that their success comes from their own ability. Simply they have high internal locus
of control. Whatever life throws at them, they will be able to make or break them through their own actions, decisions and responses. It
has always been their attitude to be responsible for the things that they do. They are very confident that they can always fulfill their
dreams.

6. Leadership - A successful entrepreneur always guides, motivates and empowers his team. It is usual for him to share his vision with his
team to inspire these people. Through convincing communication and involving his team, an effective entrepreneur is able to attain his
visions. He is able to create his own vision by constantly being the model of his team.

7. Connection - In entrepreneurship creating a network is very important. Entrepreneurs must choose those people that would form his
collective links so that he could breed his idea. There should be both emotional and financial bonds. Investment is terms of relationship so
that later this bond could be used for support when needed.

8. Self-respect - In business, it is also vital to take care of both the body, mind and spirit. Taking care of oneself daily through rest, exercise
and diet is essential. Always have ample rest and sleep for renewing ones' energy. Take time to exercise and do whatever one enjoys.
Eating healthy choices and a few treats to nourish the body is basic too.

Profile of A Successful Entrepreneur

Successful people in the field of business are creators of things with difference. They are no ordinary Juan Dela Cruz who we can be seen around
the corner. They are people with great ambition and are alert to the environment that they can explore toward successful venture. They possess
eagle’s eye that can see and dive hundreds of feet down and make catch the prey of opportunities.

Most successful entrepreneurs are described to possess the following profiles:

1. The entrepreneur has strong desire for independence. An entrepreneur would not like to be attached to his employment. He seeks
independence and strives to develop his own business. As he acquires new insights and opportunities, he would seek that sense of
independence. He thinks differently and would venture in trying to satisfy his own curiosity. He assumes responsibility with pride and
determination.
2. The entrepreneur develops strong drive to succeed. Success is for people with the profound need to achieve their dreams and life aspiration.
He does not depend on others as he thinks that his success lies on his own making. He is good organizer and leads other to successful
venture. He finishes things and leaves no stone unturned to get his way.

3. The entrepreneur has strong determination in decision making. The strong personality of the entrepreneur carries with the power to make
decisions. He is aware of developing new markets and creates new things to satisfy customers’ needs and wants. He capitalizes on his inner
drive to make profit before anyone else could take that opportunity. Innovativeness and creativity go with the power to make decisions.

4. The entrepreneur develops feedback mechanism for results. The development of feedback mechanism is one important factor in the
development of successful business entrepreneur. He goes back to where he starts and finds out things the way they are. He believes that
one who does not look back cannot go miles away from his starting point. Feedbacks are factors for analysis and decision making. He needs
data and figures to make wise decisions.

5. The entrepreneur is a result-driven individual. Profit is the result of accomplishment. His achievements are the driving forces that keep him
awake for more opportunities. He expects results for activities be planned. Employees with mediocre abilities and low sense of feeling for
accomplishment have no place in his organization. He expects results to be on time and with highest quality. He is impatient for poor
performance and expects quality output.
(Source: Acierto, Marife. (2019). Entrepreneurial Management. Intramuros, Manila: Unlimited Books & Library Services and
Publishing, Inc. pp. 3 – 14)

Concepts of Entrepreneurial Traits

1. Psychological Traits Entrepreneurship development is due to the ability of the individuals’ urge to achieve something in their life. This
concept was developed by Mc Clelland. According to him individuals have psychological urge to achieve something new. Of course the
degree of urge varies from one individual to the another. Those who have high degree of urge to achieve in their life become entrepreneurs
and all the activities enabling them to fulfil their urges are called entrepreneurship.

Mc Clelland’s research results reveal that the entrepreneurship and its development are the results of a combination of three
needs of individuals:
a. Low need for achievement
b. High need for power and
c. Low need for affiliation

a) Need Achievement: According to David McClelland’s theory of need achievement, a constellation of personality characteristics
which are indicative of high need achievement is the major determinant of entrepreneurship development. Therefore, if the
average level of need achievement in a society is relatively high, one would expect a relatively high amount of entrepreneurship
development in that society. McClelland gives the psychological concept of achievement motivation to account for the differences
in response to similar conditions.

b) Withdrawal of Status Respect:

E.E. Hagen attributed the withdrawal of status respect of a group to the genesis of entrepreneurship. Hagen believes
that the initial condition leading to eventual entrepreneurial behavior is the loss of status by a group. He postulates four types of
events can produce status withdrawal.
• The group may be displaced by force
• It may have its value symbols integrated
• It may drift into a situation of status inconsistency
• It may not be accepted the expected status on migration in a new society.

He further postulates that withdrawal of status respect would give rise to four possible reactions and create four different
personality types:

 Retreatist: He who continues to work in a society but remains different to his work and position.
 Ritualist: He who adopts a kind of defensive behavior and acts in the way accepted and approved in his society but no hopes of
improving his position.
 Reformist: He is a person who forments a rebellion and attempts to establish a new society
 Innovator: He is a creative individual and is likely to be an entrepreneur.

Hagen maintains that once status withdrawal has occurred, the sequence of change in personality formation is set in motion. He refers
that status withdrawal takes a long period of time – as much as five or more generations to result in the emergence of entrepreneurship.
 2. Sociological Traits
Entrepreneurship development is also due to the sociological traits of the individuals living in a particular place. Certain
individuals would like to attain status in the society by means of setting up of a new business or industry. However, they are allowed to act
within the constraints of the cultural norms and religious moves that are customary in the society.

a) Social norms and values:

A society sets certain norms and values for the behavior of people who are part of that society. If people violate or overstep
these norms and values, certain restrictions are likely to be imposed on them. As a result, many people are forced to accept certain
types of jobs and tasks that reflect the social environment. If the society has an open and flexible approach towards various types of
jobs and works, then people will feel free to do whatever they like and even go in for innovation and creativity. When there is more
openness and flexibility, entrepreneurship will not only emerge but also thrive.

b) Role models:
Societies that celebrate entrepreneurship and felicitate successful entrepreneurs in a way encourage many future generations
to take up entrepreneurial activities. This is because successful businessmen prove to be role models for the society at large.

c) Social pressure:
At times, entrepreneurship can emerge in a society due to social restriction too. If a society is orthodox, close and imposes a lot
of restrictions, then it is likely to backfire. People who are at the receiving end are likely to react strongly and go in for change. In other
words, because of negative pressure, more number of people would like to become entrepreneurs as a means of improving their
status. It has been noticed that where people were marginalized, they became entrepreneurs just to prove their abilities and establish
an identity in the society.

d) Respect and Status:

If societies accord recognition and respect to people who dare to do something different and creative, it proves to be an
encouragement for others to do something enterprising. Therein lies the emergence of entrepreneurship. In the traditional societies,
people were looked down upon rather than encouraged for deviating from the set norms or regular occupation. This means there was
no respect for change. Thus, societies where there is respect and recognition for people to do something different are more likely to
see the development of entrepreneurial activities.

e) Security:
The view regarding role of social security in encouraging entrepreneurship development is rather divided. One school of
thought is of the view that people are more prone to take entrepreneurial risks in secure social environments. On the other hand, there
are others who argue that entrepreneurship will more likely emerge if there are turbulent conditions. In both cases, there is scope for
entrepreneurship development.

3. Economic Factors
Apart from the psychological and sociological factors, entrepreneurship development is also due to the existing economic
activities of the state where the entrepreneurs live. Individuals learn from the existing economic activities as how best to equip
themselves for meeting the future challenges. They collect adequate economic and technical information and decide as how best to
introduce new business that suits to the expectations of the Government and its revised economic policies.

a) Capital:
Capital is one of the most important prerequisites to establish an enterprise. Availability of capital helps an
entrepreneur to bring together the land of one, machine of another and raw material of yet another to combine them to produce
goods. Therefore, capital is regarded as lubricant to the production process. Basically, capital is the life blood of any activity. If
capital is available, people who have innovative ideas would like to put them into reality. Without having any obstacles, if capital
is available, it will act as a lifeline to entrepreneurs. So, if capital is available, entrepreneurial activities will increase.

b) Labor:
The quality and quantity of labor is another factor which influences the emergence of entrepreneurship. Availability of
labor makes entrepreneurship attractive. More than abundantly available labor, the presence of skilled labor force is very
important because such a workforce is generally less mobile than other resources. If entrepreneurial activities are initiated near
areas where labor is available, then it is easy to carry out the business more comfortably and profitably at low cost.

c) Raw Materials:
Raw materials are required for establishing any industrial activity and therefore have an influence in the emergence
of entrepreneurship. In the absence of raw materials, neither any enterprise can be established nor can an entrepreneur
emerge. In some cases, technological innovations can compensate for raw material inadequacies. The supply of raw materials
is not influenced by themselves but becomes influential depending upon other opportunity conditions. The more favorable these
conditions are, the more likely is the raw material to have its influence on entrepreneurial emergence.

d) Market:
It is not only the availability of capital, labor and raw materials but a readily available market that attracts
entrepreneurial activities. Ultimately, it is the market that fetches revenue for any business. If sufficient market is not there,
people will naturally hesitate to do business in a sector where there is no market. In addition to market opportunities, it is
equally important to ensure future market opportunities for the emergence of entrepreneurial activities.
(Sources:https://backup.pondiuni.edu.in/storage/dde/dde_ug_pg_books/MCOM1005%20Entrepreneurship%20Magnt.pdf, https://www.bustudymate.in/wp-content/uploads/2019/11/Unit-I.pdf)

Case 1: STUDY ON LUCK?

 In the early 1990s, British psychologist and researcher Richard Wiseman carried out an experiement on luck to determine what defines a lucky or
unlucky person. Over several years, using advertisements in newspapers and magazines. Wiseman sought out people who felt consistently lucky or
unlucky. He interviewed them and identifies 400 volunteers whom he asked to participate in the following experiement.

The 400 participants were divided into two groups: those who considered themselves lucky, and those who considered themselves unlucky. Both
groups were given a newspaper and asked to count how many photographs in contained.

It took approximately 2 minutes, on average, for the unlucky people to count all the photos, but it only took a few seconds for the lucky people.
Why? Because the lucky people had spotted a large message ocupying more then half od the newspaper’s second page that stated: “Stop
counting. There are 43 photograps in this newspaper.” The unlucky people had missed this chance opportunity because they were too focused what
they thought they were supposed to look for.

Wiseman concluded thath unlucky people tend to miss opportunities because they are too focused on something else; whereas lucky people tend
to be more open to recognizing chance opportunities.

Wiseman’ overall findings have revealed that “although unlucky people have lamost no insight into the real causes of their good and bad luck, their
thoughts and behaviors are responsible for much of their fortume” (or misfortune).

Critical Thinking Questions:

1. Identify a successful entrepreneur. Do you believe luck played a role in their success? Why or why not?
2. Do you consider yourself a particularly lucky or unlucky person? Or do you fall somewhere in the middle? Give some reasons to support
your answer.
3. Can you think of a chance/opportunity that came your way because you were open to it? How might you make yourself more open to
“lucky” opportunities in the future?
(Source: Wiseman, R, (2003) The luck factor: The four essential principles. New York, NY: Hyperion.)

Case 2: How Entrepreneurs Find Opportunity

(SourcesBy H. James Wilson, Danna Greenberg, and Kate McKone-Sweet Source: https://hbr.org/2011/09/entrepreneurs-findopportunity)

In 2003, Jim Poss was walking down a Boston street when he noticed a trash vehicle in action. The truck was idling at a pickup point,
blocking traffic, with smoke pouring out of its exhaust. Litter was still all over the street.

There has to be a better way, he thought to himself.

Looking into the problem, Poss learned that garbage trucks consume more than 1 billion gallons of fuel in the U.S. alone. They average
only 2.8 miles per gallon and are among the most expensive vehicles to operate. In the early 2000s, municipalities and waste collection services
were considering more fuel-efficient vehicles and better collection routes to reduce their overall costs and environmental footprint. Poss was not
convinced that this was the right approach.

Through discussions with diverse stakeholders, he turned the problem upside down: the answer might not be about developing a more
efficient collection process, but about reducing the need for frequent trash collection. As he considered this solution, he discovered multiple benefits:
if trash receptacles held more trash, they would not need to be emptied so often; if trash did not need to be collected so often, collection costs and
associated pollution would be reduced; and if receptacles did not overflow, there would be less litter on the streets. There were many advantages to
this approach.

By applying the solar technology he used at work, Poss envisioned how a new machine might better manage trash. His initial concept of a
solar-powered trash compactor was dismissed in favor of other ideas for environmentally friendly inventions, including a machine that would
generate electricity from the movement of the ocean. Nonetheless the problem and the potential solutions continued to occupy his mind. "I took
pictures of trashcans on my honeymoon," Poss confessed.

He began to involve others, choosing a team based on who he knew might be interested within his social network. "We are motivated in
part because we care about the environment and in part because we know this can be financially successful." Poss and his assembled team
experimented with a variety of options and finally returned to - the Big Belly - an innovation that provides clear solutions to the problems he noted on
the city street that day. The current version can hold up to five times more trash than traditional receptacles. As a result, it dramatically decreases
the frequency of trash pickup and cuts fuel use and trash-truck emissions by up to 80 percent.

Entrepreneurial leaders like Jim Poss create opportunities using three practices that we have observed again and again in our research of
over 1,500 organizations in the past two years. While each practice is separately rooted in existing theory, entrepreneurial leaders distinguish
themselves by adroitly circulating between all three, as Poss's story illustrates:

Relying on self and social awareness. Entrepreneurial leaders shape opportunities within the context of who they are, what they know,
and who they know. Notice how Poss began with a problem he experienced directly in his life, linked that concern to his expertise in solar
technology, and then connected his ideas with others in his community and his broader networks.

Employing cognitive ambidexterity. This practice is characterized by switching flexibly back and forth between "prediction" and "creation"
approaches to thought and action. The prediction approach, which is based on analysis using existing information, works best under conditions of
certainty and low levels of perceived uncertainty. The creation approach, on the other hand, involves taking action to generate data that did not exist
previously or that are inaccessible. Note how Poss used the prediction approach as he analyzed available operational and financial data on trash
truck fuel consumption. In situations where data wasn't available, generated data himself by creating conversations and prototypes to guide his next
steps.

In some instances prediction and creation logics are portrayed as incompatib methods of thought and action. However, in our research
into entrepreneuria leadership we found this distinction to be artificial. Through conscious effort, way of thinking can be used to inform and progress
the other way of thinking making the approaches complementary. Moreover, by engaging prediction an creation approaches, entrepreneurial
leaders are able to create greater value than they had tried only one of these approaches.
 Considering social, environmental, and economic value simultaneoush We use the acronym SEERS - which refers to social,
environmental an economic responsibility, and sustainability to capture the full scope of impac that entrepreneurial leaders consider at once.
Consider how Poss was able t simultaneously consider customer benefits (reduced costs for municipalities) and environmental impact (lower fuels
emissions) without instinctively privileging on dimension over another. Using these three practices, he turned garbage into an opportunity.

Critical Thinking Questions:

1. What was the observation of Poss about the garbage problem? What was his solution to this problem? Relate here.
2. 2. What particular habit in the entrepreneurial was used by Poss in this situation? Discuss briefly.
3. Given the chance, with the same garbage problem here in the Philippines, how will you solve it the entrepreneurial way? Tell your
solution/s.