Entrepreneurship was derived from the French word ‘’entreprende’’ meaning to ‘’undertake’’. It is the practice of starting new businesses or revitalizing matured organizations, particularly new businesses in response to identified opportunities. The creation of business is certainly an important facet of entrepreneurship.
The characteristics of seeking opportunities, taking risks beyond security and having the tenacity to push an idea through to reality are important characteristics of entrepreneurs.
It involves the discovery, evaluation and exploitation of opportunities to introduce new goods and services, organizing markets, processes, and new materials through organizing efforts that previously had not existed. It is the pursuit of opportunity without regard to resources currently controlled.
Schumpeter presented five types of entrepreneurial behavior which include: the introduction of a new product; the introduction of a new method of production; the opening of a new market; the conquest of a new source of supply of raw material and the creation of a new organization of an industry.
The three main drivers of an entrepreneur are: the will – power and independence; the aim to triumph and the happiness of creating something new. Resources needed by entrepreneurs include personal touch in which customers will often pay a premium for personalized attention.
In fact, in many industries where product and price differences are minimal, the human factor emerges as a prime competitive advantage. Greater motivation is vital in the management of a small enterprise which consists of the owner(s) consequently; they work harder, longer and with more personal involvement.
Profits and losses have more meaning to them than salaries and bonuses do to the employees of a larger company. A small enterprise also has the prime competitive advantage of greater flexibility.
A big business cannot close a plant without opposition from organized labour, or even raise prices without possible intervention from the government, but a small enterprise can react quickly to competitive changes.
It could also be said that small scale enterprises have shorter business lines of communication, narrow product lines, limited markets and enjoy the advantage proximity of factories and warehouses, they can also quickly spot trouble or opportunity and take appropriate action.
Appropriate analytical skill of market trends is difficult for executives of large companies. This “management myopia” leads to redundancy and bureaucracy. In a small business the whole problem can be understood readily, decisions can be made quickly and results checked easily. Small company can try new sales tactics or introduce new products without attracting undue attention or opposition
The economic resources needed by the entrepreneurs or small scale business owners include money which is necessary to obtain goods and services that are needed for their production activities. A major way in which money is obtained is through personal savings, relations and financial institution. The real value of money can be measured in terms of what necessities, wants and security it will provide for the future.
The equipments which may be as simple as a small knife or a paper clip. It may be a telephone installed by the telephone company, a microwave oven with digital electronic controls, or a pocket computer.
The value of any equipment depends on the efficiency with which it is used because the best equipment cannot think or act on its own.
The importance of human resources cannot be underestimated, energy and skills become a vital issue that concerns all entrepreneurs. Good health is essential to maintaining a high energy level, adequate nutrition, rest and exercise are basic necessities. Personal attitudes also have a strong influence on an individual’s energy supply.
People who accomplish a great deal usually have a positive attitude and goals to motivate them. Skills are developed when a person learns how to do a task competently, anyone can develop skills by willing to put in the necessary effort.
There are several types of skills required by entrepreneurs: practical everyday skills such as writing legibly or doing household chores; vocational skills that enable a person to do a particular job; and recreational skills like dancing, painting, or sports. They enhance their life by adequately developing their skills.
The role of entrepreneurship in economic development can be viewed from various angles. Setting corporate ethical standards is very important because it involves knowing what is right and wrong accordingly. Entrepreneurs create employment for the increased population and also help to prevent rural-urban drift.
They reduce crime rate within the economy coupled with an improvement in the standard of living of the people through the provision of quality products and services. They also motivate workforce employed by the MSMEs. The improvement in standard of living is the responsibility of the entrepreneurs as healthy people will bring about a wealthy economy.
Government revenues gets a boost through the payment of Value added taxes, company income taxes and income taxes by the entrepreneurs.
Entrepreneurs source for their raw materials locally and also rely more on local content in the conduct of their activities therefore help in local resource utilization. They develop indigenous industrial machinery and equipment; evolve a management approach in consonance with the indigenous culture in addition to the provision of larger industries with raw materials for the expanded output. This will reduce the cost of production, reduce the price level and increase the level of economic welfare.
They are confronted by many obstacles in Nigeria such as lack of a pro-active regulatory environment that encourages innovative enterprise development at the grassroots level. Energy, other infrastructural deficits and systemic irregularities are inimical to the survival of small businesses.
There are trade barriers and administrative red- tapeism that curtail capacity building and inhibit access to technical support. Deserves a mention is the lack of effective regulatory mechanisms and oversight of enterprise development initiatives, especially those in the MSME space.
There is an inadequate access to vocational and skills-development training for rural and urban youths involved in the informal economy and also rampant political and bureaucratic corruption, coupled with the absence of social consensus on important macroeconomic policy issues.
Raheem Shefiu is an Acadpreneur, Business consultant, start- ups’ mentor. He specializes in Business, Economics, Entrepreneurship and Management..He is a Senior Lecturer and a Researcher with the Centre For Entrepreneurship Development, CED, Yaba College Of Technology, Yabatech, Lagos, Nigeria