Introduction To Entrepreneurship

CHAPTER 1
INTRODUCTION TO ENTREPRENEURSHIP
© Liyana Norizan DIS2016

ENTREPRENEURSHIP
ENTREPRENEURSHIP
 The word entrepreneur is derived from the French word

‘entreprendre’ which means ‘to undertake or to try’.
 The term entrepreneur itself in French refers to a person
who undertakes and operates a new enterprise or venture,
and assumes accountability for the inherent risks.
 In Malaysia, the term entrepreneur became famous after
the implementation of NEP

ENTREPRENEUR & ENTREPRENEURSHIP
 Entrepreneur is someone who establishes a new entity to

offer a new or existing product or service into a new or
existing market, whether its outcomes are profitable or non
profitable. He is also an individual who is able to perceive
an opportunity for a business, seize the opportunity and
bring in the necessary resources such as finance, workforce
and raw material to market a product or service. He takes
proper action that is imaginative, creative and innovative.

ENTREPRENEUR & ENTREPRENEURSHIP
 Entrepreneurship is the process of seeking business

opportunities under conditions of risk. It also refer to the
process of creating something new of value by devoting
necessary time and effort, assuming the accompanying
financial, physical, and social risks, and receiving the
resulting rewards of monetary, personal satisfaction and
independence.

ENTREPRENEUR & BUSINESSMAN
 An entrepreneur is an individual who seeks profitable

opportunities and takes the necessary risks to establish and
operate a business.
 A businessman main desire is to grow his business.
 A manager is responsible for using organizations resources
to accomplish the organizations goals.
Extra Reading:
http://www.forbes.com/sites/quickerbettertech/2012/06/0
6/the-difference-between-an-entrepreneur-and-a-small-
business-owner/#765ba9a634ac
ENTREPRENEUR & BUSINESSMAN
Characteristics Entrepreneur Businessman

Time Unlimited Limited
Nature of job Flexible Rigid in adapting to changes
Decision making Makes own decisions Follows decisions made by

others
Effort and Continuous Low

commitment
Risk taker Moderate Low
Goal Maximizes self potential Solely for profit

by utilizing available maximization
opportunities
CASH FLOW QUADRANT
 Robert Kiyosaki is
the best selling
author of
“Rich Dad Poor Dad”,
the # 1 Personal
Finance book in the
World, and he has
created the ‘Cashflow
Quadrant‘ to easily
breakdown the 4
types of incomes.
CASH FLOW QUADRANT
People in each quadrant have different core values and that is what
separates them into different quadrants.
E FOR EMPLOYEE
 As an Employee, you have a Job.
 This is the majority of the population. In this category, you trade

your time for money, typically working 30 to 80 hours a week for a
salary. For example, you could be a teacher, secretary, engineer,
banker, pilot, nurse, doctor, lawyer or CEO of a company.
 You can always tell who are the Employees by their core values and
the words they use.
“I’m looking for a safe, secured job with benefits.”
 The core value of employees is Security.

CASH FLOW QUADRANT
S FOR SELF-EMPLOYED
 As a Self-Employed, you own a Job. Real estate agents, insurance agents,
doctors, lawyers, consultants and accountants with their own practice,
photographers and graphic designers with their own studios and small
business owners belong to this category.
 In this category, you are still trading your time for money. In most cases, you
may work even longer hours than the Employees and you have no paid
vacations. When you stop working, your income drops or stops.
 You can always tell who are the Self-Employed by their core values and the
words they use.
“If you want it done right, do it by yourself.”
 Self-Employed also pay heavily in taxes and they must trade their time for
money.
 Most big businesses start off as Self-Employed; as they put in a System and
a Team, they have a chance to grow to become big businesses.
CASH FLOW QUADRANT
B FOR BIG BUSINESS OWNER

 “B” stands for Big Business Owner and Robert Kiyosaki defines big business as 500
employees or more.
 For Big Business owners, they are looking for good Systems, good Network, and the
smartest people they know to help run their business.
 Unlike the “S”, they don’t want to run the company by themselves. They want to have
a team of smart people run the company for them.
 As a Big Business owner, they have people work hard for them. They pay the least in
taxes and their business continue to generate a cash flow for them even when they
sleep or vacation.
 You can always tell who are the Big Business Owners by their core values and the
words they use.
“Let’s have a System and put the best Team in place.” – System and Team are the 2
key elements to transition from Self-Employed (S) to Big Business Owner (B).
 In this Category, you can work hard for a few years and, once your System and Team
are in place, you could potentially earn passive income that keeps flowing to you for
the rest of your life.
CASH FLOW QUADRANT
I FOR INVESTORS
 Last but not least, “I” stands for “Investors”. These are the
people who have money work hard for them.
 Similar to “B”, Investors also pay less taxes than Employees
and Self-Employed. With the right financial education, their
assets could produce cash flows for them regardless of their
presence.
 The core value of those on the right hand side of the Quadrant
(the “B” and “I”) is very different from those on the left hand
side.
 Big Business Owners (B) and Investors (I) value Freedom – they
don’t want to have a job anymore (unlike “E”) and they don’t
want to have to work for the rest of their lives (unlike “S”).
EVOLUTION OF ENTREPRENEURSHIP







SOCIAL RESPONSIBILITIES OF ENTREPRENEURS
Customers Suppliers
Social
Staff Responsibilities
Competitors
Country
Society/Community

 Responsibilities towards customers

1. Establish a code of responsibility that sets the
guidelines for product quality and customer relations.
2. Monitor and follow ups on complaints.
3. Gather customer feedback.
 Responsibilities towards suppliers

1. Strengthen good relationship with suppliers.
2. Pay any dues to suppliers at the agreed stipulated time
3. Sahre opinions and experiences.
 Responsibilities towards staffs

1. Always take care their welfare.
2. Give adequate wages.
3. Do not restrain them, provide guidance instead.
4. Conduct courses and training to improve staffs.
5. Reward staff with bonuses, allowances, and other perks.
6. Appreciate and recognize dedicated and highly ethical
staff.

 Responsibilities towards society/community

1. Produce, create and improve products.
2. Create choices.
3. Highest quality.
4. Sensitive to their needs.
5. Create more job opportunities.
6. Improve society lifestyle.

 Responsibilities towards competitors

1. Practise healthy competition.
2. Share ideas and opinions.
3. Work together.
 Responsibilities towards Country
1. Create job opportunities.
2. Assists in improving the lifestyle of
society.
3. Improve socio economical aspects
and increase national income.
4. Diversify.
COMPETENCIES OF ENTREPRENEURS
a. personal initiative
b. seize opportunities
c. endurance
d. information-seeker
e. high work quality
f. commitment towards work
agreements
g. efficient
h. systematic-planning
i. creative problem solving
j. self-confidence
k. assertion
l. persuasion
m. power and authority © Liyana Norizan DIS2016
CASE STUDY
 Define theories of entrepreneurships:

 Economic
 Sociological
 Psychological
 Anthropological

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What are the different types of entrepreneurs discussed in the text?

What are the different types of entrepreneurs discussed in the text?

What are some of the responsibilities of entrepreneurs according to the text?

What are some of the responsibilities of entrepreneurs according to the text?

CHAPTER 1

© Liyana Norizan DIS2016

 The word entrepreneur is derived from the French word

© Liyana Norizan DIS2016

 Entrepreneur is someone who establishes a new entity to

© Liyana Norizan DIS2016

 Entrepreneurship is the process of seeking business

© Liyana Norizan DIS2016

 An entrepreneur is an individual who seeks profitable

Characteristics Entrepreneur Businessman

Nature of job Flexible Rigid in adapting to changes

Decision making Makes own decisions Follows decisions made by

Effort and Continuous Low

Goal Maximizes self potential Solely for profit

 This is the majority of the population. In this category, you trade

© Liyana Norizan DIS2016

B FOR BIG BUSINESS OWNER

© Liyana Norizan DIS2016

© Liyana Norizan DIS2016

© Liyana Norizan DIS2016

© Liyana Norizan DIS2016

© Liyana Norizan DIS2016

© Liyana Norizan DIS2016

© Liyana Norizan DIS2016

© Liyana Norizan DIS2016

 Responsibilities towards customers

 Responsibilities towards suppliers

 Responsibilities towards staffs

© Liyana Norizan DIS2016

 Responsibilities towards society/community

© Liyana Norizan DIS2016

 Responsibilities towards competitors

 Define theories of entrepreneurships:

© Liyana Norizan DIS2016

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