CHAPTER 1

[THE ENTREPRENEURIAL MINDSET]

LEARNING OBJECTIVES
A f t e r r e a d i n g t h i s c h a p t e r, y o u s h o u l d b e a b l e t o :
°What is entrepreneur
°Identify the different types of entrepreneurs
°Describe the entrepreneurial process
°Describe the typical characteristic of Filipino
entrepreneurs
°Explain the factors that influence individuals to pursue
entrepreneurial outcomes
°Explain how entrepreneurs think and how they make
decisions
°Explain the role of risk and failure in the entrepreneurial
process
INTRODUCTION
INTRODUCTION
 Steve Jobs
Apple founder
 Bill Gates Travis Kalanick
Microsoft founder Mark Zuckerberg Uber co-founder
Facebook co-founder
 Lucio Tan
National Bookstore
Philippine Airlines and Owned by Socorro Ramos
Asia Brewery
 Zest-O Corporation Mang Inasal founder
President Alfredo Yao Edgar Sia II
Jollibee founder Lamoiyan Corporation
Tony Tan Caktiong founder Cecilio Pedro
ECHOstore co-founder
Pacita Juan
DISCUSSION
WHAT IS ENTREPRENEUR?
 ‘entrepreneur’
‘entrependre’
which means ‘to
undertake’
Entrepreneurship is the process
of designing, launching and
running a new business, which
is often initially a small business.
The people who create these
 TYPES OF ENTREPRENEURS
Microentrepreneurs Megaentrepreneurs
is a type of entrepreneur that makes  They create a big amount of value-
value added and profits limited added and profits
a small business employing fewer these individuals are also willing to
people absorb huge risks of using enormous
they are not crucial in bringing rapid amount of capital in their business
economic prosperity to a country, ventures
they contributed to the economic growth
nevertheless contribute to inclusive of a certain country.
growth
 Both of
entrepreneurs
undergo the process
of starting and
managing a business
whether it is for
economic growth or
for inclusive
growth
 ENTREPRENEURAL PROCESS
‘entrepreneurial discipline’
It involves several stages from the
awareness of an opportunity to
the realization of a business data.
The steps include the following:
(a) discovery (b) development of
concept (c) organizing resources
 discovery

development of concept

organizing resources
implementation

reaping returns
CHARACTERISTICS OF
AN ENTREPRENEUR
(i)The first pertains to how
personal traits connect with the
way entrepreneurs create “value-
added”
(ii) the second involves the link
between these personal qualities
and the formation of
entrepreneurial intentions.
Entrepreneurial Traits and Creation of
Value-added
 The characteristics of an entrepreneur will vary
depending on whether they are in the developed
countries pursuing
Schumpeterian entrepreneurship or in developing
countries operating small enterprises.
 The level of education, employment status,
wealth, and risk appetite of entrepreneurs differ
Entrepreneurial Traits and
Creation of Value-added
•The level of education,
employment status, wealth, and
risk appetite of entrepreneurs
differ depending on the amount of
value added or profit created by
their enterprises.
Level of education
•Studies have shown that entrepreneurs
need some formal education to be able to
seize the opportunities presented by
inventions, innovations, and other
technological developments.
Employment status
•Individuals who became entrepreneurs in
developed countries are usually former
employees of companies in the formal sector.
Risk appetite
•Risks are associated with
uncertainties in business operation.
•These uncertainties can threaten the
survival and stability of a business
enterprise.
Entrepreneurial Traits and Entrepreneurial
Intentions
•Based on studies, there are two broad set
of factors that may influence the formation
of entrepreneurial intentions: internal and
external factors.
•Internal factors include mainly the
qualities of individuals such as
demographics, personal traits, psychological
characteristics, individual skills, prior
knowledge, and social ties.
•External factors Includes environmental
support and environmental influence.
 ENTREPRENEURAL
DECISION-MAKING

Decision-making is an
essential part of
entrepreneurship that affects
numerous elements in
operating a business based
on Mayr’s Organizational
Management (2013)
 TYPES of MENTAL PROCESSES
 Critical thinking
The systematic and rational way of providing an
answer to a question.
• Creative thinking
Refers to thought process that bring about discovery of
new ideas.
• Strategic thinking
Involves thought processes that assess current situation
that can be useful in the formulation of plans for the
future.
RISKS, COGNITIVE ADAPTABILITY, AND
ENTREPRENEURIAL DECISIONS
Risk- can be described as uncertain
situations and developments that increase the
probability of loss or business failure.
Different types of risk:
 Internal risk- pertains to dangers coming
from management of resources of a business
enterprise that may imperil its operations.
Ex.
Financial risk
Damage to reputation
Failure to innovate
External risk- are threat coming from various
environments outside the business firm.
Ex.
 Lethargic economy
 Increased competition
 Commodity price risk
 Regulatory risk
 Business interruption
Political risk
Risk management- process of
identifying, assessing and responding
to these risks. The forecasting and
evaluation of financial risks together
with the identification of procedures
to avoid or minimize their impact.
For internal risk:
 The company may adopt controls on the
use of physical and financial resources to
ensure efficient resource utilization.
 Install mechanism and prepare a long-term
plan
 It can also devote resources for research
and development that can support the
innovation projects of the company
 For the external risk:
Can hold periodic reviews of
their strategic plans in
preparation
Prepare for contingency plans
in case of emergency
Cognitive adaptability- demands
that an entrepreneur be
flexible and open to various
decision processes.
These are the characteristics
of an entrepreneur:
Flexible
Dynamic
Self-control in decision
making
CONCLUSION
 After reading this chapter, you should be able to know that
entrepreneurship is the process of designing, launching and running a new
business, which is often initially a small business and the people who
create these businesses are called entrepreneurs.
There are different types of entrepreneurs, the micro entrepreneurs
and mega entrepreneurs. mega entrepreneurs is the individuals who are
also willing to absorb huge risks of using enormous amount of capital in
their business ventures while Micro entrepreneurs is a type of
entrepreneur that makes value added and profits limited.
There many entrepreneurial process that are needed to be followed
and this are discovery, development of concept, organizing resources,
implementation and reaping returns.
 The typical characteristics of Filipino entrepreneurs is fearful of business
failure because of their attitude. How does entrepreneurs think and how they
make decisions? Entrepreneurs should recognize the problem so that they fix the
gap between their business and the people desires to improve. Analyze the
problem, after you find the problem you should analyze how it affect your business
and what are the possible solutions to fix this problems. Select the best solution
for this problem so that the problem won't cause too much if there are
unintentional difficulties. Lastly implement the decision that had been made so
that the problem can be solved. There are role of risk and failure in the
entrepreneurial process, and this role might help you become a successful
entrepreneur and this is why we should take risks because we can learn from our
failure and used it to succeed in our business.
The characteristics of being an outstanding entrepreneur as you had learned
that entrepreneur should had a positive mindset, flexible in doing, risk taker, had a
good mental thinking and have an urge to learned to become a better
entrepreneur.
In conclusion an entrepreneur needs to have a
good personal qualities such as being complex,
risk taker, observant, creative, open culture, result-
arranged, group-situated in order to be a
successful entrepreneur. These entrepreneurs’
attributes are the principle esteem that should be
learned, pursued and connected by every person
so as to move toward becoming accomplishment
that decides the achievement or disappointment of
their business condition. These business creative
qualities can be entrust basic component that vary
EVALUATION
1.It refers to the recognition of a business idea or
the detection of opportunities that could make
money for entrepreneur?
2.It gives more details on how the general
business idea can be realized?
3.It describes the process of identifying, sourcing,
and financing human, nonhuman, and other
resources needed for the conduct of business?
6. These are threats coming from various
environments outside the business firms?
7. It pertains to dangers coming from the
management of resources of a business
enterprise that may imperil its operations?
8. Refers to thought processes that bring
about discovering new ideas?
9. What is SWOT?
10. It refers to the systematic and rational way
 Answer: 8.creative thinking
1. Discovery 9.strengths ,
2. Development of a weaknesses,
business concept opportunities,
3.organizing threats
resources 10.critical thinking
4. implementation
5.risk
6.external risks
7. internal risks
• V. Reference
• https://businessjargons.com/entrepreneurial-process.html
• https://en.m.wikipedia.org/wiki/Entrepreneurship
• https://curtsnethen.wordpress.com/entrepreneurial research/micro-vs-macro/
• Pathways to Entrepreneurship (book Pg.1-16)
• https://www.google.com/amp/s/mayrsom.com/2013/03/15/entrepreneurial-decision-making/amp/
• https://www.audible.com/pd/Blue-Ocean-Strategy-
Audiobook/B0036GPMOO?ds_rl=1262685&ds_rl=1263561&ds_rl=1260658&mkwid=DSAINTTitle_dm&pcrid
=239333741503&pmt=b&pkw=&source_code=GO1GBSH07271690CC&cvosrc=ppc%20dynamic%20search.g
oogle.634950925&cvo_crid=239333741503&cvo_pid=33581432409&gclid=Cj0KCQjwov3nBRDFARIsANgsdoE
8hhWEmpu8xUCigWHdgMGUol700T55vCiAo847-REAHohR6VNgpI0aAhG8EALw_wcB&gclsrc=aw.ds
• https://www.mindtools.com/pages/article/newTMC_08.htm
• https://www.entrepreneurshipinabox.com/2062/an-introduction-to-decision-making-process/
•
http://entrepreneurship38.blogspot.com/2016/04/conclusion.html