Chapter One

CONCEPT OF ENTREPRENEURSHIP

ENTREPRENEURSHIP, ENTREPRENEUR & ENTERPRISE

1.

Introduction

If we look at the Nigerian Economic landscape today, we will observe the existence of

many companies whose origins date back to the colonial days of Nigeria's history.

Companies like UAC Nigeria Plc fit such description. There are others like the Shell

Petroleum Development Company of Nigeria Limited. These are large multinational

corporations with huge assets at their disposal. Although we are aware of their

existence and operations, we will not pay any attention to a study of their operations.

What is important to us in our own study is a study of how new businesses emerge and

also how they are to be run or managed successfully. In a way, we can say that our

interest in studying entrepreneurship is not just to understand existing business

organisations, but rather to understand how to establish and manage new businesses,

especially from the scratch. Let us now proceed to define entrepreneurship.

2. Definition of Entrepreneurship

In elementary economics, we were told that there are four factors of production. The

four factors of production are land, labour, capital and the entrepreneur.

The

Entrepreneur according to economic theory is the person who coordinates the other

three factors of production. Following this we shall define the entrepreneur as someone

who starts a business idea, arranges business deals and takes the risks in order to make

a profit.

The words underlined in our definition are very important. First, the entrepreneur is
the one who starts the company or business. Interestingly, one of the key objectives of

this course is to equip students with the necessary skills to start their own business.

Secondly, the entrepreneur takes the necessary business risks. The information that we

are given is that the entrepreneur takes the necessary business risks in the market place.

If the entrepreneur is successful, she/he makes a profit. However, if the entrepreneur is

unsuccessful, the result will be a loss. From what we have discussed so far, it is very

clear that entrepreneurship is all about starting businesses and running them.

3. Entrepreneur and Entrepreneurship

Entrepreneurship involves the creation of values, the process of starting or growing a

new profit-making business, the process of providing a new product or service, and the

intentional creation of value through organisation by an individual contributor or small

group of partners (Hisrich, 1986).

Oslon (1987), leaning on the classical theory of the Capitalists, see entrepreneurship as

risk taking. The entrepreneur is an innovative individual who establishes and manages

a business for the purpose of profit and growth. He says that the critical trait of the

entrepreneur ranges from a keen sense for innovation, knowledge of what is important

and what needs to be done to a high tolerance for ambiguously unstructured situation.

This serves as attitudinal mode for a moderate risk taker.

Entrepreneurship involves the harnessing of individual dreams andd imaginations o

produce values in form of goods and servioes Entrepreneurs ane, therefore, agents o

change and groswth as they act to accelerate the economic growth, dissemination an

application of irnovative deas In doing so they not only ensure efficient use o

resources but also exparnd the boundaries of economie activities. In the developet

economies, entrepreneurs generate two-thirds of all new jobs account for at least h

thirds of all technological innovations: and influence more than two-thirds of th

difereces in economic growth in these days of globalisation and digital econom

Sall irms play a crucial role in experimerntation and innovation that lead

technological change and employment growth

An entrepreneur is one who discovers and decicdes what opportunities he wants

pursue and the risks he is willing and able to acceptThe entrepreneur somehoe

decides between time and money between building his own and buying whicheverthe

opportunity is, in order to attain his goals

An entrepreneuris creative and this is the willingness to look beyond products to ideas

Products and processes are only the vehicle through which an idea becomes effective.

4.

Enterprise

It is a word that encompasses the definition of corporations, small businesses, non-

profit institutions, government bodies, and possibly other kinds of organisations. The

term enterprise seemed to do the job. In practice, the term is applied much more often

to larger organisations than smaller ones.

Some simple definition of an enterprise:

A business firm

A company

Entrepreneurship, the practice of starting new business organisations

An undertaking, especially one of some scope, complication, and risk

Industrious, systematic activity, especially when directed toward profit

private enterprise is basic to capitalism.

Willingness to undertake new ventures and initiatives

A project or undertaking that is especially difficult, complicated or risky

Readiness to engage in daring or difficult action: initiative

Aunit of economic organisation or activity, especially, a business

organisation.