Please make sure that it is your own work and not copy and paste off of someone else work. Please read the study guide. Plea
Please make sure that it is your own work and not copy and paste off of someone else work. Please read the study guide. Please watch out for spelling errors and grammar errors. Please use the APA 7 th edition.
Book Reference:Neck, H. M., Neck, C. P., & Murray, E. L. (2021). Entrepreneurship: The practice and mindset (2nd ed). SAGE. https://online.vitalsource.com/#/books/9781544354644
Part I: Introduce yourself to your classmates with your name, location, current employment, and future goals.
Part II: From reading this unit's material, what topic was the most interesting to you? What information did you find the most surprising? Can you foresee a point in your life where you would take a step toward becoming an entrepreneur? Why, or why not?
BUS 8303, Entrepreneurship and Innovative Business Development 1
Course Learning Outcomes for Unit I Upon completion of this unit, students should be able to:
1. Compare the types of entrepreneurship. 1.1 Contrast different types of entrepreneurship related to a level of risk. 1.2 Analyze a type of entrepreneurship.
4. Examine business models.
4.1 Apply a business model. 4.2 Explain a company’s use of business models.
Course/Unit Learning Outcomes
Learning Activity
1.1 Chapter 1 Student Resource: Frugal Innovation Unit I Case Study
1.2, 4.1 Unit Lesson Chapter 1 Unit I Case Study
4.2
Unit Lesson Chapter 1 Student Resource: Challenges of a Family Business Unit I Case Study
Required Unit Resources Chapter 1: Practicing Entrepreneurship In order to access the following resource, click the link below. Navigate to the Video and Multimedia area in Student Resources for Chapter 1 of the eTextbook to view the items listed below.
• Challenges of a Family Business
• Frugal Innovation
Unit Lesson
Characteristics of an Entrepreneur How do you define an entrepreneur? Are you surprised to learn the truth about entrepreneurs rather than the myths that are falsely attributed to entrepreneurs? In the article by Goyette (2019), it is stated that more managers are building an entrepreneurial mindset in their employees with a growing preference to hire people who can contribute within an organization as an intrapreneur, a person who acts and thinks in an entrepreneurial manner. In this course, entrepreneurship is explained in depth to help you understand who entrepreneurs are, the characteristics of entrepreneurs, and why these characteristics support the success of the entrepreneurial venture. In later units, tools and resources will be presented as mechanisms to enhance your creativity and build your own entrepreneurial skills. Characteristics connected to entrepreneurship include creativity,
UNIT I STUDY GUIDE
Exploring Entrepreneurship
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resourcefulness, perseverance, passion, motivation, being future-oriented, optimism, an adventurous spirit, flexibility, ethical behavior, comfort with ambiguity and risk, emotional and social intelligence, and humility. Each of these characteristics associated with successful entrepreneurs comes from research on the qualities displayed by entrepreneurs through a variety of studies that attempted to find out why some people become entrepreneurs, while other people are content to work for others.
Entrepreneurship and Ethics A common theme within the field of entrepreneurship is the importance of being ethical and honest. Since there are many risks associated with the progression from identifying a problem, finding a solution, and building the venture, a variety of people are needed along this path. Entrepreneurs focus more on collaborating with others than on competing against other people or organizations. Within each of these relationships, each person is dependent on the other for building a successful venture. In these relationships, each person must speak the truth, even when the information is detrimental. The earlier any negative information is identified and communicated, the quicker the problem can be addressed. Building teams and networks is another important characteristic of entrepreneurs. An entrepreneurial team is a significant part of a venture’s success.
Some derailers result from childhood experiences where learned messages, such as a fear of failure, hold us back in life. Surprisingly, some people even have a fear of being successful, as the message heard in childhood could have been that the person was inadequate or incapable of being successful.
Social Entrepreneurship
In fitting with this emphasis on ethical behavior, a subdivision within the field of entrepreneurship is about creating non-profit ventures and for-profit ventures that solve a societal need. Social entrepreneurs identify challenges faced by social and environmental problems, such as how to add more protein to a population’s diet in a tropical climate. One solution to this problem could be the creation of shitake mushroom farming to add a new source of protein into the local populations’ diet. Another idea is farming oyster mushrooms to teach people how to earn extra income by selling their mushrooms. Once you start developing your
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entrepreneurial mindset, you will start to notice more examples of social entrepreneurship and the creation of new products to solve unique challenges.
Intrapreneurship In this course, preconditioned restrictive messages about entrepreneurship will be diminished as your knowledge of the field of entrepreneurship is expanded and as you learn how to develop your entrepreneurial skills to become alert in continuously viewing the world through a lens that notices all of the possibilities for creating new ventures to solve problems. Not only is the topic of entrepreneurship relevant to the idea of starting a venture, it’s also relevant from the perspective of intrapreneurship, the focus on creating new products within an organization. An example is 3M, which was originally named Minnesota Mining and Manufacturing Company. It has a history of success, failure, success, innovation, and perseverance (3M, n.d.). In addition to its history of innovation and perseverance, 3M has a focus on collaboration and trust, essential components that propelled 3M into the Fortune 500 list with over 60,000 products and a presence in over 70 countries. One-third of those products were invented within the last 5 years (3M, n.d.). To support intrapreneurship, 3M is known for encouraging employees to spend 15% of their time working on new ideas. Even ideas that do not result in success count as work toward new inventions (Goetz, 2011). 3M’s mission includes the importance of protecting employees and the environment, creating products with a high value to the customer, incubating and protecting disruptive technologies and processes, and developing and engaging employees (3M, n.d.). This type of supportive environment is intentionally designed to encourage entrepreneurial activities that are, in the case of working within an established corporation, examples of intrapreneurship.
Business Models and Entrepreneurship Along with growing entrepreneurial behaviors through intrapreneurship, other forms of entrepreneurship can occur through understanding business models. Business models describe the method for providing a value that results in revenue. Some organizations like YouTube avoided creating a traditional business model around selling a service. Instead, YouTube was created with the intent of harvesting, or selling the company. Their innovative business model was designed to grow the volume of video data, rather than create a business model based on revenue related to uploading video. Another innovative type of business model includes subscription services, the idea of the customer purchasing a regular predetermined quantity of a product over a set timeline, a growing trend in start-up companies. The topic of business models and entrepreneurial venture success has not been studied extensively. An article by McDonald and Eisenhardt (2020) explores how business models position the new venture for success in noting the value in adjusting traditional business models to align with the value proposition. The example from this article points to the difference between Blockbuster and Netflix. Blockbuster’s business model was time-locked; whereas, Netflix’s business model offered ease of use and flexibility while simultaneously tracking individuals’ streaming history and preferences. These key alterations to the business model used by Blockbuster differentiated Netflix as an entertainment provider that offered key values to their users. The openness to reconsidering the business model from a creative value-added perspective locked Blockbuster out of the video rental industry. Even redefining how the industry is described provides new insights into defining the business model. The redefined industry move from video rental to entertainment provider has reshaped this industry with Netflix advancing to creating their content, solidifying their business model even further to block out competing players. The topic of business models and revenue models is covered later in the course in more depth.
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Manager vs. Entrepreneur There is a difference between being a manager and being an entrepreneur. Entrepreneurial ventures are not small versions of large corporations. There is a difference between following a method rather than a process. Entrepreneurs focus on taking action, experimenting, and seeking out the best business model that fits their venture and target market. There is even the idea of failing until success is reached. Failure is an opportunity to learn, rather than accepting a result without considering the various components or variables that were part of the action or experiment.
Behaviors of Entrepreneurs Keep in mind the importance of enjoying this course as part of the entrepreneurial behaviors of playfulness and experimentation. During this course, take time to apply the topics covered in the chapter readings. For example, Table 1.7 in Chapter 1 of the eTextbook shows how to use deliberate practice, which is a concept similar to practicing mindfulness. Consider practicing these activities at least once a day. Being deliberate, being consciously aware, and being in the moment are activities that you could build into your life. The benefit is improved perception, memory, intuition, and metacognition (Neck et al., 2021). These are documented behaviors of entrepreneurs proven to be effective and worth your time in practicing the activities and tools covered throughout this course.
Interactive Activity In each unit, you will find an interactive knowledge check activity, where you follow Claire’s story and help her develop a business idea. This is a nongraded activity.
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In order to check your understanding of concepts from this unit, complete the Unit I Knowledge Check activity. Unit I Knowledge Check PDF version of the Unit I Knowledge Check Note: Be sure to maximize your internet browser so that you can view each individual lesson on a full screen, ensuring that all content is made visible.
Conclusion
In today’s world of uncertainty, stepping out of traditional career paths and stepping into the world of entrepreneurship can provide greater control over your life. Although this sounds contradictory given the unknowns in starting a new venture where even the industry might not have existed before the startup opened, the average employment time within one company has now dropped to 3.2 years for employees between the ages of 25 and 34 (Doyle, 2019). As an entrepreneur, your efforts are directly related to advancing the development of your venture. Growing your idea into a successful venture is a rewarding manifestation of your dream, your idea.
References Doyle, A. (2019, November 8). How long should an employee stay at a job? The Balance Careers.
https://www.thebalancecareers.com/how-long-should-an-employee-stay-at-a-job-2059796 Goetz, K. (2011, February 1). How 3M gave everyone days off and created an innovation dynamo. Fast
Company. https://www.fastcompany.com/1663137/how-3m-gave-everyone-days-off-and-created-an- innovation-dynamo
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Goyette, K. (2019). 5 things leaders do that stifle innovation. Harvard Business Review. https://libraryresources.columbiasouthern.edu/login?url=https://search.ebscohost.com/login.aspx?dire ct=true&db=bsu&AN=139155074&site=eds-live&scope=site
McDonald, R. M., & Eisenhardt, K. M. (2020). Parallel play: Startups, nascent markets, and effective
business- model design. Administrative Science Quarterly, 65(2), 483–523. https://doi- org.libraryresources.columbiasouthern.edu/10.1177/0001839219852349
Neck, H. M., Neck, C. P., & Murray, E. L. (2021). Entrepreneurship: The practice and mindset. SAGE. 3M. (n.d.). The history of 3M: From humble beginnings to Fortune 500.
https://www.3m.com/3M/en_US/company-us/about-3m/history/
Learning Activities (Nongraded) Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit them. If you have questions, contact your instructor for further guidance and information. In order to access the following resource, click the link below. Utilize the following Chapter 1 Flashcards to review terminology from the eTextbook.
- Course Learning Outcomes for Unit I
- Required Unit Resources
- Unit Lesson
- Characteristics of an Entrepreneur
- Entrepreneurship and Ethics
- Social Entrepreneurship
- Intrapreneurship
- Business Models and Entrepreneurship
- Manager vs. Entrepreneur
- Behaviors of Entrepreneurs
- Interactive Activity
- Conclusion
- References
- Learning Activities (Nongraded)
,
1 PRACTICING ENTREPRENEURSHIP
© Peshkova/Shutterstock
“The best way to predict the future is to create it.”
—Peter Drucker
CHAPTER OUTLINE
· 1.1 Entrepreneurship Requires Action and Practice
· 1.2 Entrepreneurship May Be Different From What You Think
· 1.3 Types of Entrepreneurship
· 1.4 Entrepreneurship Is a Method, Not a Process
· 1.5 The Method Involves Creating the Future, Not Predicting It
· 1.6 The Key Components of the Entrepreneurship Method
· 1.7 The Method Requires Deliberate Practice
· 1.8 How This Book Will Help You Practice Entrepreneurship
Learning Objectives
· 1.1 Explain the importance of action and practice in entrepreneurship.
· 1.2 List the seven lesser-known truths about entrepreneurship.
· 1.3 Compare and contrast the different forms of entrepreneurship in practice today.
· 1.4 Distinguish between entrepreneurship as a method and as a process.
· 1.5 Compare and contrast the prediction and creation approaches to entrepreneurship.
· 1.6 Illustrate the key components of the Entrepreneurship Method.
· 1.7 Assess the role of deliberate practice in achieving mastery.
· 1.8 Propose different ways in which this book can help you practice entrepreneurship.
There’s no doubt that we are living in unpredictable times: High schools and colleges are struggling to keep up with the ever-changing job market; underemployment rates are skyrocketing, especially among younger people; those halfway through their careers are asking what else is possible; mature workers are wondering what comes next; and seniors are postponing their retirement to stay relevant. The traditional concept of staying in one job for your entire working life is a thing of the past, especially when people are being asked to reinvent themselves every 5 years. In a world full of uncertainty, rapid change is the only constant.
Although the future of the traditional workplace may be unclear, the climate is ripe for entrepreneurship. Traditionally, entrepreneurship has been associated with launching new businesses. However, many individuals and institutions are beginning to think of entrepreneurship as a vital life skill that extends far beyond the ability to launch a venture, a life skill that prepares individuals to deal with an ambiguous and uncertain future. In other words, you don’t need to build your own company to think and act like an entrepreneur! Entrepreneurship embodies methods for thinking, acting, identifying opportunities, and approaching problems that enable people to manage change, adjust to new conditions, and take control of actualizing personal goals, aspirations, and even dreams. It’s also a vehicle for developing a set of skills—financial, social, communication, marketing, problem solving, and creative thinking, to name a few—that are applicable across many fields. Taken together, these are mindsets and skillsets that not only enable you to start a venture, but will also distinguish you in a variety of traditional and nontraditional life paths. To be entrepreneurial is to be empowered to create and act on opportunities of all kinds for yourself.
ENTREPRENEURSHIP REQUIRES ACTION AND PRACTICE
>> LO 1.1 Explain the importance of action and practice in entrepreneurship.
Entrepreneurship is a way of thinking, acting, and being that combines the ability to find or create new opportunities with the courage to act on them.
Entrepreneurship: a way of thinking, acting, and being that combines the ability to find or create new opportunities with the courage to act on them.
Master the content at edge.sagepub.com/neckentrepreneurship2e
The pursuits of entrepreneurs have touched every corner of our lives, affecting every aspect of the way we live—from electricity, to music, to transport, to agriculture, to manufacturing, to technology, and many more. Although it can be difficult to see entrepreneurial possibilities in the midst of unemployment, economic recession, war, and natural disasters, it is this sort of turbulence that often pushes us into creating new opportunities for economic progress. History shows us that in spite of the obstacles in their paths, all kinds of entrepreneurs have consistently taken action to change the world. For instance, Benjamin Franklin successfully invented the lightning rod (1749); George Crum created the potato chip (1853); and Josephine Cochrane invented the first automatic dishwasher (1893). This text is about creating the next page of history. It’s time to bring the voices of today’s entrepreneurs into the conversation. It’s also time to bring your voice into the conversation. What kind of entrepreneur do you want to be?
The first automatic dishwasher, invented by Josephine Cochrane
Sam Hood via Wikimedia Commons.
ENTREPRENEURSHIP MAY BE DIFFERENT FROM WHAT YOU THINK
>> LO 1.2 List the seven lesser-known truths about entrepreneurship.
Our belief is that by taking action and putting ideas into practice, everyone “has what it takes” to be an entrepreneur. However, this is not necessarily the same message that is delivered by popular media. Let’s examine some popular images of entrepreneurs. What is the truth behind these images?
Media Images of Entrepreneurs
The media often exaggerate the meteoric rise of “overnight global sensations” such as Bill Gates (Microsoft), Steve Jobs (Apple), Mark Zuckerberg (Facebook), Elon Musk (Tesla), Jack Ma (Alibaba), Oprah Winfrey (Harpo Group), and Travis Kalanick (Uber). The likes of Bill Gates and his peers are certainly inspirational, but we would argue that few can personally identify with the stories surrounding them, and they do little to represent the reality of entrepreneurship.
The truth is there is no such thing as an overnight success.
Debunking the Myths of Entrepreneurship
Rather than focusing on the myth of the overnight success story, let’s take a look at some truths, illustrated in Table 1.1 . Separating truth from fiction can be difficult, especially when some of these truths collide with the stories we read about in the media. Let’s explore these truths in more detail to further understand how entrepreneurship can be a path for many.
Table 1.1 The Truths About Entrepreneurship
|
Truth 1 |
Entrepreneurship is not reserved for startups. |
|
Truth 2 |
Entrepreneurs do not have a special set of personality traits. |
|
Truth 3 |
Entrepreneurship can be taught (it’s a method that requires practice). |
|
Truth 4 |
Entrepreneurs are not extreme risk takers. |
|
Truth 5 |
Entrepreneurs collaborate more than they compete. |
|
Truth 6 |
Entrepreneurs act more than they plan. |
|
Truth 7 |
Entrepreneurship is a life skill. |
Entrepreneurship in Action Juan Giraldo, Waku
Juan Giraldo, founder of Waku
Photo Courtesy of Juan Giraldo
Entrepreneurs are seeing many opportunities in the market for health drinks: no sugar, low sugar, vitamin-infused waters, carbonated, not carbonated, healthy teas, fermented teas, drinkable yogurt, cold brew coffees, smoothies—it seems that we are all craving tasty yet healthy replacements for soda. Dozens of new beverages have emerged in the marketplace to satisfy the latest health trends, serving consumers’ needs to feed mind, body, and spirit. We are in the midst of a generational shift that has created an industry with exponential growth. Take kombucha tea, for instance: This fermented tea, which is claimed to provide significant health benefits, is expected to be a $5 billion industry by 2025.
Juan Giraldo, an Ecuador-born entrepreneur, has been capitalizing on these trends with his company, Waku. Waku produces and sells wellness teas made with 20 super herbs from the Andes Mountains. They compete directly with kombucha-style drinks, but, Juan claims, “Waku tastes much better.” Traditional kombucha is a lightly fermented beverage that boasts great health benefits derived from various probiotics. “Waku’s wellness teas are also delicious and nutritious, but the health benefits stem from the medicinal benefits of the herbs used in the ingredients. The drinks are not fermented and are excellent for one’s digestive system.”
Juan has been an entrepreneur since he was 19 years old. His first company was an advertising firm that he sold to his business partner, and his next venture was an online fashion outlet, which went bankrupt within 18 months. After that, he became CEO of a small IT consulting firm before founding Waku. The idea for Waku arose when Juan and his friend, Nicolas Estrella, exchanged fond memories of the “wellness tea” they used to drink in their homeland of Ecuador. After both moved to Boston, they decided to produce their own version of this beverage and sell it in the Boston area. The initial production of the tea helped support the businesses of approximately six independent Andes farmers who grew the medicinal herbs and flowers used to produce the product. What exactly is Waku? It is a filtered water brew blend of 20 herbs and flowers. The name comes from the Quechua word wanku (together), which represents the combining of the ingredients as well as the team effort that goes into the production of the product.
Juan’s first step was to travel to Ecuador to source the right ingredients in order to test his concept. Back in the United States, the Waku team began developing prototypes. At the same time he was developing Waku, Juan was also earning his MBA at Babson College. Thinking that millennials were his target market, he felt surrounded by his potential customers and used them as resources. Juan would buy rival tea products and conduct countless taste tests to compare his Waku recipes to the competition. By developing early prototypes and conducting taste tests, he was able to interact with potential customers and get valuable feedback. Juan quickly learned that his target customers were not millennials who were well educated and well traveled, but women between the ages of 40 and 60 who wanted to live a healthier lifestyle.
The early growth of Waku created supply challenges. As the company grew from shipping one pallet of ingredients from Ecuador to ordering one full container (11 pallets) a month, Waku altered its strategy for paying its suppliers. Originally, Juan was expected to pay for all ingredients at the time of purchase, but that required a lot of cash up front. At the same time, Waku needed the ingredients from its suppliers to effectively meet forecasted demand. To find a solution, Juan traveled to Ecuador to work out a deal with the suppliers. After building trust with his suppliers, he proposed that they give Waku 180 days of credit to pay for ingredients. This would allow Waku the time to get the ingredients, produce the teas, sell the teas, and then pay its suppliers. As Juan explains, “At first the suppliers were hesitant, but after I showed them Waku’s plans for payment and how important the suppliers were to the brand, they agreed.”
With $200,000 in annual revenues, Juan believes the product has the potential to be a legitimate contender for market share as the business grows. Although Juan is certainly concerned with profits, that is not his only motive. His business offers beverages that he grew up with, and he truly believes in the brand because of how much it hits home. “I want to provide opportunities for the people back in Ecuador. Producing top-quality ingredients is what we are known for in the rural parts of my country.” Today, Waku has four full-time employees, an intern, and a strategic consultant. It also provides steady, reliable business to many farmers throughout rural Ecuador. As Waku continues to grow, many people in Ecuador will reap the benefits through an influx of capital and job creation.
Although he has been an entrepreneur for a long time, Juan admits that he didn’t know much about the healthy beverage sector and needed a lot of advice. “I sent out emails to the top competitors in the industry, simply asking for advice. And many were more than willing to offer it!” Juan recalled. His advice to other entrepreneurs? “Don’t be shy to ask for help. Mentors can have huge impacts on your performance. Reach out to the superstars in your industry. You will be amazed how many people will want to help a young entrepreneur who has the burning desire to succeed.”
Critical Thinking Questions
What differentiates Waku from other health beverages on the market today?
Why was Juan able to approach his suppliers with the request he made regarding payment?
Does Waku have a responsibility to the region of the world in which it sources its ingredients and finds its inspiration? •
Sources:
Juan Giraldo (interview with author, October 22, 2018).
https://www.grandviewresearch.com/press-release/global-kombucha-market
https://livewaku.com/
https://www.bostonglobe.com/lifestyle/food-dining/2018/10/15/waku-wellness-tea-with-roots-ecuador/23cPv5lwSkwLrkdhcNSrnN/story.html
Truth 1: Entrepreneurship Is Not Reserved for Startups
The term startup came into vogue during the 1990s dot-com bubble, when a plethora of web-based companies were born. The term has various meanings, but we subscribe to Steve Blank’s definition of startup: a temporary organization in search of a scalable business model.1 In the traditional view of startups, anyone who starts a business is called an entrepreneur. The entrepreneur crea
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