MGT602 Handouts Merged by M Habib

Author: Jawad Hassan, Instructor Business Administration, Virtual University of Pakistan

Technical Articles Theme 01 · Title: History and Introduction of Entrepreneurship · Videos: 1-12 · Topics Covered

1. Course Introduction
2. History of entrepreneurship (Part a): The beginning
3. History of entrepreneurship (Part b); as an emerging discipline
4. History of entrepreneurship (Part c); Current practices
5. What is entrepreneurship? The definition
6. Who is an entrepreneur? The definition
7. Role of entrepreneurship in economic development and growth
8. Role of entrepreneurship in economic development and growth (country cases) Part 1
9. Role of entrepreneurship in economic development and growth (region wise) Part 2
10. The decision to become an entrepreneur
11. Common myths about entrepreneurs
12. The potential benefits of being entrepreneur

The Rise of Entrepreneurship

Entrepreneurship is a buzzword nowadays. Entrepreneurship is about doing business, creating profits, and adding workforce to an economy. A business graduate has the choice to establish himself as a job creator or a job seeker. Governments, educational institutions, financial institutions, and NGOs support entrepreneurship through the availability of finance and the development of incubation centers. Entrepreneurship has emerged as a discipline over the years. Entrepreneurship is a practical and experiential subject. Entrepreneurs are expected to be intelligent, genius, and super-smart people. Starting an enterprise and then establishing it as a successful business is not a coincidence, rather it is engineered with the right business process, stable approach, and decisions. Studying entrepreneurship enlightens fresh business graduates with the theory, evolution, dimensions, and challenges of the modern business world. Entrepreneurship is also helpful for in-action businessmen to equip them with technical handling of business matters i.e. marketing, financial and administrative management. A human being who has got some talent as an artist, musician, or has got any other business skills is a potential entrepreneur. A potential entrepreneur can learn the art of doing business i.e. entrepreneurship from mentors (academicians, industry experts, and tech entrepreneurs) who guide you to make smart management, marketing, and strategic decisions.

The act of entrepreneurship is rooted in the enterprising nature of mankind since pre-historic times. The enterprising nature of mankind urges him to discover non-routine actions in a dynamic way i.e. creation of new ventures and finding solutions to the existing problems and challenges, faced by society at large. Initially, humans were hunter-gatherers and used to live in form of isolated entities, known as tribes. Their only adventure was to hunt for their food and shelter and then survive against Mother Nature by confronting different weather conditions. In this pursuit, humans’ enterprising nature ventured fire lightening techniques, tool-making techniques, food hunting, and storing methods. The enterprising nature of mankind further urged him to try different methods to grow food that channelized different farming methods. Farming at a large scale brought the big economic revolution, also called as big green revolution to mankind at that time. The big green revolution turned hunter-gatherer tribes into agricultural societies. Humans were required to have rules, traditions, and governance to run the emerging agricultural societies. Agricultural societies started to produce surplus food which got being traded among the multiple tribes. In that way, the concept of merchant entrepreneur emerged when excess got traded. Mankind further developed the great Silk Road in ancient times to develop trade relations between different continents of the world.

The invention of the steam engine brought the industrial revolution by fulfilling the transportation needs of traders among the farthest trade destinations and markets. The industrial revolution gave birth to the era of manufacturing, the establishment of big industrial units. In this way, an era of craft production led the way to an era of mass production. Railroads, iron factories, textile mills, mining, weapon industry, and all the scientific inventions to date are the fruits of the industrial revolution. The improvement in human living standards and increased traveling needs gave rise to big units and a decline in small business units. The United Kingdom government published the Bolton Report in 1971, indicating 8 important functions of small firms, depicting their importance to the economy. In the meanwhile, Small Business Administration (SBA) from the United States of America enlightened the importance of small firms and stressed the importance of their re-emergence. SBA pointed out that due to new inventions, technological changes, new industries and sub-contracting, demand for more services and variety, individual customer requirements, employment opportunities, privatization and tax benefits from the government are the main reasons why small firms are important to establish an enduring economy. The industrial revolution lead mankind towards a technological revolution, also called as computer revolution. All these revolutions are not accidental but in fact, credited to the human enterprising nature.

1946-First computer machine  1954-First commercial computer  1981-Personal Computer and www/.com revolution  1993-Search Engine revolution  today-Social Media revolution/Artificial intelligence/machine learning.

Entrepreneurship as an Academic Discipline

An academic discipline is a branch of knowledge, a particular area of study, or a subject of study being taught in a college or university. Some of the most known academic disciplines are philosophy, geography, archeology, psychology, economics, history, mathematics, political science, social science, computer science, management science, and linguistics. Entrepreneurship is an interdisciplinary discipline in business administration, sociology, psychology, culture, marketing, finance, and geography. Economics is the mother discipline of entrepreneurship. The term entrepreneur is rooted in the French language in the 12th century. “Entrepreneur” means “to take between” (the act of risk-taking between buyer and seller and creating a venture).

•  Richard Cantillon, an Irish French economist from the 17th century described the entrepreneur as a person who has an insight into a business opportunity and takes the risk by knowing the cost of the venture but the reward is unknown to him. “Entrepreneur is a person with foresight and confidence to operate in a condition where the cost may be known but rewards are uncertain”
•  Jean Baptiste Say, a French businessman from the 18th century broadly categorized an entrepreneur as a buyer and seller and also as an innovative person. “The entrepreneur shifts economic resources out of an area of lower and into an area of higher productivity and greater yield”