Understanding Entrepreneurial Competencies and their Impact
Entrepreneurial competencies are crucial skills possessed by successful entrepreneurs for effective performance. McClelland and McBer identified key competencies like initiative, systematic planning, problem-solving, and more. Entrepreneurship impacts a nation by providing leadership in industrial development, introducing innovations, and improving productivity.
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CHAPTER 2 COMPETENCIES OF ENTREPRENEURSHIP
ENTREPRENEURIAL COMPETENCIES
PERSONAL ENTREPRENEURIAL COMPETENCIES (PECs)_ The term Entrepreneurial Competencies refers to the abilities or skills that should be possessed by successful entrepreneurs in order to perform functions effectively. entrepreneurial
Entrepreneurial Competencies McClelland and McBer (1985) Initiative Systematic planning 01 06 02 03 04 Sees and acts on opportunities Efficiency orientation 05 Persistence Information seeking
Entrepreneurial Competencies McClelland and McBer (1985) Problem solving 07 12 08 09 10 Self-confidence Use of influence strategies 11 Assertiveness Persuasion
IMPORTANCE OF ENTREPRENEURSHIP
MINDMAP DIAGRAM WRITE YOUR SUBTITLE HERE Enterprising Country Allocate resources productively and efficiently Importance Create wealth Healthy entrepreneurial culture Provide avenues
How Entrepreneurship Impacts a Nation? 1. Providing leadership in the industrial development An entrepreneur is the combination of two skills an ideal person and a manager There must be persons who have vision, initiative and drive to utilize the resources. These qualities and abilities are combined only in entrepreneurs.
2. Introducing innovations and changes Entrepreneur always looks for changes Entrepreneur not only combines the factors of production but also introduces new combinations of factors. Responds to changes and exploits it as an opportunity.
3. Increasing productivity The resources & co-ordinates the various factors of production. entrepreneur allocates scarce An entrepreneur employs each factor in the right proportion by using the best technical devices, division of labour, etc. An entrepreneur tries to eliminate waste in production.
4. Providing employment Entrepreneurship generates employment and income. It also helps to reduce unemployment which is the root of all socio-economic problems.
5. Increasing the standard of living of the people Entrepreneurs can contribute much to the growth of national income of a country by exploiting natural resources, creating wealth and generating employment and income. A country is said to have achieved economic development only when its people enjoy a higher standard of living.
FACTORS AFFECTING ENTREPRENEURSHIP
FACTORS AFFECTING ENTREPRENEURIAL GROWTH Economic Factors Entrepreneurial Growth Non-Economic Factors Government Action Social Condition Psychological Factors
1. Economic factors From a strictly economic viewpoint, it can be said that the same factors which promote economic development account for the emergence of entrepreneurship also. Capital Labour Economic Factors Raw Materials Market
Capital: Capital is one of the most important prerequisites to establish an enterprise. Availability of capital facilitates the entrepreneur to bring together the land of one, machine of another and raw material of yet another to combine them to produce goods. Capital is therefore, regarded as lubricant to the process of production/render services. Labour: The quality rather quantity of labour in another factor which influences the emergence of entrepreneurship.
Raw Materials: The necessity of raw material hardly needs any emphasis for establishing any industrial activity and therefore it influences the emergence of entrepreneurship. In the absence of raw materials, neither any enterprise can be established nor an entrepreneur can emerged. Market: The fact remains that the potential of the market constitutes the major determinant of probable rewards from entrepreneurial function. The size and composition of market both influence entrepreneurship in their own ways.
2. Non-economic factors Non-Economic factors Social Conditions Psychological Factors Legitimacy of Entrepreneurship Social Mobility Security Need Achievement
Social Conditions Legitimacy of Entrepreneurship: The proponents of non- economic factors give emphasis to the relevance of a system of norms and values within a socio-cultural setting for the emergence of entrepreneurship. Social Mobility: Social mobility involves the degree of mobility, both social and geographical, and the nature of mobility channels within a system. Security: Security is a significant factor for entrepreneurial development. If individuals are fearful of losing their economic assets or of being subjected to various negative sanctions, they will not be inclined to increase their insecurity by behaving entrepreneurially.
Psychological Factor Need Achievement: If the average level of need achievement in a society is relatively high, one would expect a relatively high amount development in the society. of entrepreneurship
3. Government action The government by its actions or failure to act also does influence both the economic and non-economic factors for entrepreneurship development. Any interested government in economic can help, through its clear expressed industrial policy, promote entrepreneurship in one way or other, by creating basic facilities, utilities and services and by providing incentives and concessions. The entrepreneurs a facilitative socio-economic setting. Such conductive setting minimizes the risks which the entrepreneurs are to encounter. government can provide the prospective The supportive actions of the government appears as the most conductive to the entrepreneurial growth.
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