ENTREPRENEURSHIP IN TOURISM and to fulfill them through skill management

resources.
AND HOSPITALITY
• British economist, John Stuart Mill: entrepreneurs
Pointers in IHM 311
as one of the factors of production (land, labour,
What is entrepreneurship? capital and entrepreneur).

• Entrepreneur stems from the French word ADAM SMITH THEORY

“entreprendre” which refers to individuals who
• Known as the Laissez-Faire Theory
undertake the risk of new ventures.
• Promotes economic freedom
• Richard Cantillon, a French economist asserted
• Free-enterprise economy (where the role of government
that an entrepreneur invests, transforms and makes
is only limited to the provision of education, peace, order,
profit / loss.
justice and public infrastructure.
• Adam Smith widened the scope to include the task
Product of John Maynard Keynes’s
of forming an organization for commercial purposes
and the extra qualities of the entrepreneur (ability to • Shaped the way we know entrepreneurship today
foresee potential through changes in the economy purports that government can be allowed to play key roles
and to act on the demand). in economic development especially to emerging
economies or those that are rising from depressed
• French economist, Jean Baptiste : the entrepreneur
economic situations.
was said to influence society by forming enterprises
and in turn influenced by society to recognize needs
RICARDIAN THEORY RISK TAKER- Businesses face risk. Entrepreneurs
minimize risk through research, planning, and skill
• Named after economist David Ricardo
development.
• This theory believed that the land is the key factor for
PERCEPTIVE- Entrepreneurs view problems as
economic growth.
opportunities and challenges.
• Points to land and agriculture as the drivers for the
CURIOUS- Entrepreneurs like to know how things work.
development.
They take the time and initiative to pursue the unknown.
HARROD-DOMAR THEORY
IMAGINATIVE- Entrepreneurs are creative. They imagine
• Theorized by the professors Harrod and Domar. solutions to problems that encourage them to create new

• Points to the value of machine and other physical capital products and generate ideas.

(tangible human- made objects that a company buys or PERSISTENT- True entrepreneurs face bureaucracy,
invest) in economic development. make mistakes, receive criticism, and deal with money,

• As it benefits from efficient production using machines family, or stress problems. But they still stick to their

and effective service provision that were enhanced by dreams of seeing the venture succeed.

modern tools and equipment. (As the state-ofthe-art GOAL-SETTING- Entrepreneurs are motivated by the
amenities determine customer attraction and satisfaction. excitement of staring a new business. Once achieved, they
seek out new goals or ventures to try

ENTREPRENEURIAL CHARACTERISTICS SELF-CONFIDENT- Entrepreneurs believe in themselves.

Their self-confidence takes care of any doubts they may
have.
FLEXIBLE- Entrepreneurs must be flexible in order to ARTISTS: Are highly creative type, very conscious about
adapt to changing trends, markets, technologies, rules, business.
and economic environments.
THE VISIONARY: Too focused on dreams with little
INDEPENDENT- An entrepreneur’s desire for control and focused on reality.
the ability to make decisions often makes it difficult for
ENTREPRENEURSHIP and ECONOMIC
them to work in a controlled environment.
DEVELOPMENT IN TOURISM AND
HARDWORKING- Entrepreneurs need a great deal of
HOSPITALITY- DRIVERS AND BARRIERS TO
energy to see a venture start and succeed.
ENTREPRENEURSHIP
CLASSIFICATION OF ENTREPRENEURS
GLOBAL VARIABLES- these are important to understand
INNOVATIVE ENTREPRENEUR: Such entrepreneurs for anyone to smoothly navigate in the business world.
introduce new goods or new methods of production or
• Research and Development (R&D)
discover new markets or reorganize the enterprise.
• Information and Communication Technology
IMITATIVE OR ADOPTIVE ENTREPRENEUR: Such
(ICT)
entrepreneurs don’t innovate; they copy technology or
• Environment, Social and Corporate Governance
technique of others.
Standards (ESG)
PRIME MOVER: This entrepreneur sets in motion a • Population and Cross-Cultural Diversity (CCD)
powerful sequence of development expansion and • Emerging ideas (AI, VR, Blockchain, etc.)
diversification of business. • Trade Agreements (APEC, NAFTA, EU, CAFTA,
DR and others)
MANAGER: Such an entrepreneur doesn’t initiate
expansion and its content in just staying in business. THE
LOCAL VARIABLES- when someone decides to pursue
and entrepreneurial activity are also important to
understand.
• CULTURE- as affected by the prevailing culture
• COMPETITORS- direct and indirect competitors
• OVERCONSUMPTION OF CULTURAL
COMMODITIES- too much food from private and
commercial establishments going wasted; living in
houses that are way too big; driving cars
everywhere instead of walking or using public
transport; purchasing stuff not because it's needed

• CUSTOMERS- the active and prospective base but simply because it's on sale or costs.

• COMMUNITY- area where the enterprise will be • OVERCOMMERCIALIZATION- a situation where

situated something has become excessively

commercialized.
• COLLABORATORS- such as regulatory bodies,
suppliers, religious communities and other • GENTRIFICATION- An example is Poblacion,

stakeholders. Makati—a 102-hectare residential barangay

located in between the famous Kalayaan and
APPLIED ETHICS IN SERVICE INDUSTRY
Jupiter Streets. Included here is the Rockwell
ENTREPRENEURSHIP
Center which many years back had turned into a
• CULTURE IMPORTATION- A nation adopting - commercial mixed-use hub full of hole-in-the-wall
consciously or unconsciously - the cultural restaurants and bars.
practices of a foreign nation - is 'importing' culture.
• CONFLICT OF VALUES- the disagreement with
• VALUES ERADICATION- He or she forgets the someone who doesn't share our viewpoint and has
responsibility to society and tries to enjoy freedom other beliefs and value systems rather than ours.
in the ultimate sense.
▪ Issues that are realities in both mass and sexual assault, such as rape and unwanted
premium tourism and hospitality markets such touching, and sexual harassment.
as:
▪ Exploitation- Pagsasamantala
▪ Pollution- the introduction of harmful
▪ Unfair Labor Practices
materials into the environment.
**UN SDGS and the role of tourism and hospitality
▪ Economic Infringement- the use or
enterprises (Please read and familiarize)
production of copyright-protected material
without the permission of the copyright
holder. PREPARATION TOWARD AN
▪ Depletion of Natural resources- when ENTREPRENEURIAL JOURNEY
resources are taken from the environment
• CONVERTING IDEAS TO REALITY- It is also
faster than they are replenished. Causes of
about looking at potential business ideas by keenly
natural resource depletion include
and insightfully observing current market conditions
population growth, consumer habits,
and seizing opportunities as it reflected.
industrialization, climate change, and
• CREATIVITY IN ENTREPRENEURSHIP- the
pollution.
ability to develop new ideas and solutions to
▪ Environmental Degradation - the problems. It is the ability to see into the future and
destruction of ecosystems and the extinction generate ideas, solutions and innovations before
of wildlife. they are needed. It is the ability to solve your

▪ Sexual Abuse- any sexual activity without customer's or client's problems before they even

consent. Other forms of sexual violence are realize the problem exists.
• PASSION- FOLLOW THROUGH
ENTREPRENEURSHIP-
o Entrepreneurial passion is critical for the
success of any venture whether start-up or
in expansion.
o It is a motivational paradigm that is
characterized by positive emotional and
internal drive.
o An engagement with personally significant
work that is prominent to self-value of the
businessperson.
• INNOVATION IN ENTREPRENEURSHIP- From
ideas to solution then to transformation.
According to the Oslo Manual (2018),
there are 5 types of innovation:
• ORGANIZATIONAL- changes
organizational strategies that will cause a
change in company and general culture.
(Ex: Work from home arrangement)
• PROCESS- change in way that product or
services get produced, created and
delivered to final consumers. (Virtual Tours)
• PRODUCT- introducing new or enhanced
product or service features that will induce
new product or service experience and
satisfaction and not necessarily involving an
increase in sales. (Edible water pouch)
• MARKETING- having creative ideas and
executing same in the area of price,
packaging, design or promotion. (Refilling
outlets for hygiene products)
• ECO INNOVATION- synonymous to
innovation borne out of a business direction
towards its sustainability agenda. With
response to UN SDG Agenda of 2030.
in (Solar powered hotels; electronic
vehicles for short distance tour.)
• INTERPERSONAL COMPETENCIES-
These are qualities, behaviors, and soft skills
that are exhibited when interacting and
communicating with others.
 • BUSINESS COMPETENCIES-
trends, and challenges about a product or
service have to be identified and understood
in order to navigate the intricacies of
entrepreneurial pursuit.
• PROTECTION OF CREATIVE IDEAS-
o PATENTS- the restricted right granted for an
invention, including the materials
processes that is attributed to it, through and
approval of patent application.
o TRADEMARKS- identifiable sign, word or
symbol that indicates the identity of a
product or service, and is protected through
a legal and non-legal process.
o COPYRIGHT- the right over an intellectual
property that is protected through a legal
process, in case of copy issues.
• THREE O’S:
• OPPORTUNITY SEEKING- an ongoing
process of considering, evaluating and
pursuing market- based activities that are
believed advantageous for the enterprise.
Facts, • OPPORTUNITY SCREENING- the
process by which entrepreneurs evaluate
innovative product ideas, strategies and
marketing trends.
• OPPORTUNITY SEIZING- all about taking
the opportunity in a business activity as it
presents itself and while it is still available.
and
TOURISM AND HOSPITALITY BUSINESS
ENVIRONMENT
• A tourism product is a combination of
tangible and intangible elements such as
natural, cultural, and man-made resources,
attractions, facilities, services and activities.
• Industry 4.0
o This means that the digitalization and
traditional process were linked
together in a network. The results in
an intelligent value chain and product
life cycle.
• The concept of the sharing economy is utilizing • Evaluating a firm's strengths and
unused personal resources such as spare weaknesses helps identify areas where the
bedrooms and car seats more efficiently. organization excels and where it needs
• Innovative Collaboration- a service improvement, ultimately enabling the
innovation where brands of different industries organization to capitalize on opportunities
are collaborating to provide complementing and mitigate threats in the market.
service to guests. (Ex: hotel firm partnering with
• Opportunities and threats in the business
a known car brand to provide limousine service
environment are external factors that
to guest executives with business meeting)
organizations must monitor and respond to.
• Wearable Technology- used in high-end
These factors are often unpredictable and
accommodation establishments worldwide. (use
beyond the organization's control, requiring
of key cards both employees and guests could
strategic planning and adaptability.
collect information such as areas frequented by
guests, virtual reality inside the hotel room) • Key success factors are controllable

• Cloud services and other services app- for variables critical for competition that

smaller hotels that can’t afford in-house organizations must focus on to achieve

technical support is a big help to their operation. success in their industry. These factors can

(SaaS) include innovation, customer service, quality,

and efficiency.
STRATEGIC MANAGEMENT IN
• Organizations should respond to competition
ENTREPRENEUSHIP
by differentiating themselves through higher
quality, innovative products or services,
 superior customer service, and effective within an organization that provide a
marketing strategies. competitive advantage and are difficult for
competitors to replicate.
• Developing strategic options involves
exploring various paths and opportunities • Core competencies should be difficult for
available to the organization to achieve its competitors to duplicate and should provide
goals. It helps in establishing a clear valuable benefits to customers, thereby
direction and plan for the organization's giving the organization a sustainable
future growth and success. competitive advantage.

• Strategic plans should be implemented by • Identifying target markets and implementing

converting them into actionable steps and market segmentation strategies allows
specific initiatives that guide daily operations organizations to understand the diverse
and decision-making within the organization. needs and preferences of customers,
This ensures alignment with long-term goals enabling them to tailor their products or
and objectives. services more effectively.

• Businesses can thrive by reducing • Organizations can leverage their unique

expenditures on electricity and water bills, resources to offer value to customers by
leading to lower overhead costs. This allows providing services or features that
for more efficient resource allocation and competitors cannot replicate, thereby
potentially higher profitability. enhancing customer satisfaction and loyalty.

• Core competencies refer to the unique

combination of resources and capabilities