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- 1. 1 COURSE TITLE Entrepreneurship for Engineers (Ieng5182) Instructor Information Name: Berhanu T. Office: Bl-18-R-11 Email: tolosabire12@gmail.com
- 2. 2 Chapter 1 THE ENTREPRENEUR AND THE ENTREPRENEURIAL VETURE
- 3. 3 Chapter Outline Introduction Forms of Entrepreneurs Motivation Factors for Entrepreneurship Rewards of Entrepreneurs Competencies of Entrepreneurs Entrepreneurial Process Wage Employee Vs Entrepreneur
- 4. 4 Introduction • Entrepreneurship is the process of creating something different with value by devoting the necessary time and effort. • It is more an attitude than a skill or a profession. ( water engineer vs. entrepreneurship graduate)
- 5. 5 • Entrepreneur is derived from the French word entreprendre, meaning “to undertake.” –The entrepreneur is one who undertakes to organize, manage, and assume the risks of a business. The Evolution of Entrepreneurship
- 6. 6 Entrepreneurship cont.…. • Is the process of recognizing of an opportunity to create value, and the process of acting on this opportunity, whether or not it involves the formation of a new entity. • It involves risk bearing. • It involves some type of innovation, a significant investment, and a strategy that values expansion.
- 7. 7 Entrepreneurship Formulae • Entrepreneurship = entrepreneurial education (behavioral) + mind set (attitude) + supported with actions (thinking to walking) E=EE+MS+SA
- 8. 8 Who is an entrepreneur? • Entrepreneur is an individual who organizes or operates a business. • Is a person who owns, organizes, manages and runs an enterprise assuming the risk of a business or enterprise. many definitions
- 9. 9 Cont’d • Is a person who establishes a business venture and is a visionary leader - a person who dreams great dreams. • Eg: Today’s technological advancements are the results of visionaries that lived in the past. Like; • Thomas Edison: the electric bulb, the alkaline battery. • The wright brothers (Orville and Wilbur): The airplane etc.
- 10. 10 Cont’d • Entrepreneur is an individual who: Has the ability to identify and pursue a business opportunity Undertakes a business venture Raises the capital to finance it Gathers the necessary resources Sets goals for himself/herself and others Assumes major portion of the risk
- 11. 11 Cont’d • Why study entrepreneurship ? • Why now? • Do you want to be an entrepreneur? • Why not? • What do you know about it? • Do you think you can be an entrepreneur?
- 12. 12 Why be an entrepreneur? Luxurious life Better life standard Financial freedom
- 13. 13 Who can be an entrepreneur? If you think you can’t, then you can’t be Positive image to your self to unleash your potential The way we see ourselves really matters !!!!!! Every body
- 14. 14 If you think you can, then you can be an entrepreneur entrepreneurial mindset Avoid Negative Attitude!!!!!!
- 15. 15 Thinking to Doing The doer has gone earlier
- 16. 16 Real world evidences ♣ Bethlehem Tilahun ♣ Bill gates ♣ Steve Jobs
- 17. 17 Bethlehem Tilahun • Bethlehem Tilahun Alemu is one most successful Women in Africa. • She has got 11 different awards from 2011-2014.
- 18. 18 Why study entrepreneurship and be an entrepreneur now? • You have skills and knowledge of engineering and technology. • You have an access to resources like: – laboratory for experimentation (research based) – Time – Supportive Reading materials – Instructors’ supervision – Can have fund for noble ideas • Others: – The need to economic freedom – Contribute for the nation’s unemployment rate
- 19. 19 Forms of Entrepreneurs 1. Individual Entrepreneur 2. Intrapreneur 3. Social Entrepreneur
- 20. 20 1. Individual Entrepreneurs • Also called business entrepreneurs. • Are individuals who conceive idea for new product/service and then create a business to materialize their idea into reality. • Are individuals who started, acquired, or franchised his or her own independent organization. • Examples Are; – Steve Jobs – Bethlehem Tilahun – Bill Gates
- 21. 21 2. Intrapreneur • Is a person who does entrepreneurial work within large organization. • He/she can be described as one who: – works in an existing business, – identifies new products/services or opportunities for an existing business, – is creative and uses ability/insight to market/produce product, – organizes and controls resources to ensure a profit for the existing business
- 22. 22 3. Social Entrepreneurs • Are people who drive social innovation and transform in to various fields including: – Education, – Health, – Environment and – Enterprise development • Eg: Scott Harrison has raised fund and provided drinking water access for 17 countries.
- 23. 23 Motivation Factors for Entrepreneurship • The reasons for small firm formation can be divided between "Pull" and "Push" influences. • Pull influence • Some individuals are attracted towards small business ownership by positive motive such as: – Desire for independence – Desire to exploit an opportunity – Financial incentive/motivation
- 24. 24 Cont’d • Push influence • Many people are pushed into finding a new enterprise by variety of negative factors including; – Redundancy (Being without a job, idleness) – Unemployment – Disagreement with previous employer
- 25. 25 Rewards of Entrepreneurs • Self-actualization/personal fulfilment. • Feeling of freedom and independence. • Providing jobs and benefits to others. • Creating economic value (product/service, incomes for workers, profits for shareholders/partners).
- 26. 26 Cont’d • Entrepreneurial myths - (not facts) – Entrepreneurs are lucky – Entrepreneurs make or break on the first venture – Entrepreneurs are born not made – Entrepreneurs are High-Tech wizards – Entrepreneurs are extreme risk takers (gamblers) – All Entrepreneurs need to be successful is money $$
- 27. 27 Cont’d • Costs of being an Entrepreneur – Works long class sessions – Always concerned about the business – Needs high energy – High level of stress – Sacrifices other important aspects of life – Limited social life – Not much time with family and friends – Risk
- 28. 28 Competencies of Entrepreneurs • Layers of competency are: 1. Personal effectiveness competencies 2. Academic competencies 3. Workplace competencies 4. Industry wide technical competencies 5. Industry sector technical competencies 6. Management and occupational requirements
- 30. 30 1. Personal Effectiveness Competencies • Interpersonal skills • Strong initiative • Ambition • Adaptability & flexibility • Willingness to take risks • Willingness to learn
- 31. 31 2. Workplace Competencies • Creative thinking • Networking • Planning and organizing • Problem solving & decision making • Checking, examining, & recording • Computer applications • Business fundamentals
- 32. 32 3. Academic Competencies • Reading an writing • Mathematics • Science and Technology • Communication (speaking and listening) • Critical and analytical thinking
- 33. 33 4. Industry Wide Competencies • Principles of entrepreneurship • Innovation & invention • Planning • Marketing • Financial management • Business operations • Risk assessment & management
- 34. 34 Entrepreneurial Process • 1st stage • Income generation: to generate surplus or profit. • 2nd stage • Self-employment: refers to an individual’s fulltime involvement in his own occupation. • Terminal stage • Entrepreneurship: looking for diversification and growth.
- 35. 35 Paradigm Shift of Entrepreneurship • A paradigm is a preconceived idea of what the world is, what is should be like and how it should operate. • A shift from opportunity discovery to opportunity creation( causation to effectuation) A. Causation B. Effectuation
- 36. 36 A. Causation • Refers to traditional systematic decision making process. • The entrepreneur first defines the goal and thereafter chooses the means of how to get there. • Success in a causation process requires collection of pre-information for – planning and, – predicting future events and – minimizing risks.
- 37. 37 B. Effectuation • Effectuation is especially for expert entrepreneurs. • In effectuation, entrepreneurs do not start with a given goal; they start by thinking of: – who they are, – what they know and – whom they know. • Effectual logic is thus based on the awareness of available means and resources.
- 38. 38 Wage Employee Vs Entrepreneur Wage Employee • Work for others • Follow instructions • Routine job • Earning is fixed, never negative • Does not create wealth Entrepreneur • Own boss • Make own plans • Creative activity • Can be negative sometimes, generally surplus • Create wealth, contribute to GDP
- 39. 39 Entrepreneurs Vs Inventors • An inventor is a highly driven individual motivated by his or her own work. • An inventor falls in love with the invention. • Entrepreneur falls in love with the organization (the new venture).
- 40. 40 Advantages of Entrepreneurship • To an Individual • Provides Self Employment for the entrepreneur • Entrepreneur can provide employment for near & dear one • Entrepreneurship often provides an employment and livelihood for next generations • Freedom to use own ideas – Innovation and creativity • Unlimited income / higher retained income • Independence • Satisfaction
- 41. 41 Cont’d • To the Nation • Provides larger employment • Results in wider distribution of wealth • Mobilizes local resources, skills and savings • Accelerates the speed of economic development • Stimulates innovation & efficiency
- 42. 42 End of Chapter One Thanks a lot !!
- 43. 43 Quiz(10%) • What do you aspire to be after school? – Wage Employee? – An Entrepreneur? – Or what else? • Why? • There is no right answer. • Write your answer on a piece of paper.