An Entrepreneur is “someone who specializes in making judgmental decisions about the coordination of scarce resources, emphasizing that “judgmental decisions” implies decision-making under uncertainty and that the ability to identify and exploit opportunities is essential.” (Casson, 1982). Simply, entrepreneurs seek out and identify make new ventures and decide whether to turn the idea into a reality through business planning and research. Entrepreneurship is an important part of the economy today as it is crucial in solving needs and wants of consumers as well as providing new products and services which enable a more efficient life or different experience (Carlsson et al. 2013).
Entrepreneurship first began around 17,000 BCE in New Guinea where locals exchanged obsidian for weapons and other needs. These early entrepreneurs exchanged one set of goods for another.
During the time from the fifth to the fifthteenth century in the medieval era there were no explicit entrepreneurs because the medieval system did not recognize the modern concept of a firm (M. Casson & C. Casson, 2014). However, there was evidence of activity with entrepreneurial characteristics during the time. Business risks were high due to the unsafe methods of transport, for example, shipwrecking as well as robbery. Due to this, entrepreneurs worked through companies of merchant venturers, based in the larger cities, meaning goods could be moved in convoys and ships were chartered communally (M. Casson & C. Casson, 2014). This joint venture developed a trust-worthy culture in which entrepreneurs could operate in their own community assisting each other. Furthermore, establishments such as churches, monasteries and the royal court were also open to individual management by ambitious entrepreneurs however financial rewards were replaced with internal promotion.
The concept of entrepreneurship however has had very little study until the Industrial revolution and the growth of business in the Age of High Imperialism (M. Casson & C. Casson, 2014). In the sixteenth century, important innovations in agricultural practice began and peaked in the mid-eighteenth century. The acquisition of land and increasing size of farms reduced the cost of food, expanded the population and fed a growing work-force during the Industrial revolution (M. Casson & C. Casson, 2014). Canals were the main highway for distribution and allowed raw materials, such as coal, clay and salt, to be distributed to factories as well as finished products being able to reach their markets. These workings were all dependent on the commitment of entrepreneurs (M. Casson & C. Casson, 2014).
The subsequent development of mass production and mass marketing early in the 19th century saw entrepreneurs such as Andrew Carnegie and Henry Ford identify the benefits of mass production and change the way entrepreneurs could develop products (M. Casson & C. Casson, 2014). In 1913, Ford, created the assembly line which consisted of a conveyor belt carrying the work through a series of assembly areas. This allowed him to efficiently build and design cars for his business, the Ford Motor Company, and he became a famous role model for entrepreneurs today.
Entering the entrepreneurial mindset is all about becoming more of a risk taker. As said by Sandra A. Matheson (2013, p.146) ‘It is about making a decision to move in a particular direction and then “just doing it”. No elaborate plan, objectives, tasks, to do lists…. Just doing whatever it takes every day.' This means putting yourself out there and there is no better time than now to become an entrepreneur (Matheson, 2013). Matheson has developed her own success formula for entrepreneurs which uses key modern day concepts to ensure the success of starting a business in our world today. Her formula is as follows; being well prepared, having an international network of colleagues, being a self-directed learner, creating businesses that are sustainable and having key relationships (Matheson, 2013). In evaluation, it's essential as it is in any business to be prepared for the day to day highs and lows of operations and adapting to change. This requires entrepreneurs to be a people person, meaning you can welcome and work with different personalities and manage relationships positively. As said by Matheson ‘Success happens when preparedness meets opportunity' (2013, p.147).
In the growth stage of the business, referrals are key. It's important to be punctual, complete the task at hand and use manners, ultimately this will impress customers and others and lead to loyalty and word of mouth advertising. The goodwill of the business is critical for follow up purchases and referrals so it is important to train staff more than adequately because staff represent the business and can mean the difference between a sale or not (Matheson, 2013).
The characteristics of an entrepreneur are what sets them apart from regular executive officers and managers. These are the qualities and traits the make a business idea a reality. When discussing the characteristics of an entrepreneur the task is subjective as venture capitalists have different opinions of which they prefer in an entrepreneur. However, there are several characteristics that are both inherent and essential to all entrepreneurs. These include honesty, intelligence, skillfulness and education. These are the four essential qualities entrepreneurs must possess, a deficiency in any of these essentials usually threatens venture failure (Hines, 2004). Moreover, there are several traits which entrepreneurs should hold to control their business prosperity in a successful manner. These include a positive energy level, ego, courage, enthusiasm, desire to make money, creativity, resourcefulness, tenacity and leadership qualities. Not one of these qualities is more important than the other, they are all a fundamental part of entrepreneurship (Hines, 2004). Three of these qualities are discussed in more depth below.
The desire to make money is often confused with greed. However, the desire to make money is essentially the entrepreneurs will to win and to accomplish. Unless this thirst for success and wealth is held the business may become another statistic for business failure. Money is the reward all entrepreneurs are avidly seeking, they want profits. They want as much of this as possible to satisfy the risk they have taken.
Tenacity is defined as the quality of continuing to exist. It is imperative to place emphasis on tenacity because young entrepreneurs are faced with so many difficult problems with a growing business that many quit or “want out” because of the pressure they face. It is important to stay in the market place and remember that every business goes through difficult times. It's about how you react to these obstacles that defines you as an entrepreneur.
Leadership qualities are of course principal, they give an entrepreneur the ability ‘to stimulate, relate to, and empathize with his employees, officers, directors, and shareholders.' John L. Hines (2013, pg. 408). Leading staff helps create a positive work culture and assists them in keeping to the task at hand. An entrepreneur must determine the most effective management style he will practice whether it be behavioral or participative for example. This decision should consider the type of business and its processes so the best possible management is achieved.
TJ Clark and Sons is a private, family run, heavy machinery transport business which began during the depression in the 1930's. The business was started by Tom Clark whose mission was to survive the depression and provide for his family. Originally, a horse and cart was used for transport, today the business uses 11 large Kenworth trucks and trailers for its jobs. The businesses mission today is ‘anything that's difficult to move, we move'.
Thomas Clark, the Grandson of the original owner, is now the part-owner and managing director of the business. He grew up watching and learning from his father operating the business and eventually he gained control. He took on the risks of the business and ensured the business sustained a competitive advantage in the marketplace. I believe he is an entrepreneur as he possesses all the qualities and characteristics outlined by Hines and Matheson above. His entrepreneurial mindset and drive can be seen in the interview that was conducted with him. When asked what inspired him to get into the running's of the business he said, ‘My father was my great inspiration, he had a great work ethic and he taught me all the basics of the transport industry. I was also very interested in the trucks and CAT branded machinery that we moved.' Tom has devoted his life to the business, from a very early age he sacrificed travelling with his mates to go work with his Dad and take in all day to day workings of the business. He said he would have loved to travel but it was important to learn how the business operated. Here I saw the entrepreneurial qualities of honesty and devotion to business that an integral part to an entrepreneur's business (Hines, 2004).
When Tom first became managing director of the business in the late 1980's he said that ‘the business was dealing with dated work practices'. This meant that he had to use his own knowledge and help from others to fix up the financial and operating principles of the business to keep up with technology and laws. He said, ‘Change was difficult for the drivers and other stakeholders but we are a small transport business in a specific market that major players are always looking to take control of so we need to sustain our profitability and market share.' This shows Tom has taken on change and helped the business adapt to remain competitive. He has shown the entrepreneurial qualities of leadership and courage (Hines, 2004) to sustain a competitive advantage through ‘innovation, dealing with challenging markets and purchasing better equipment'. He has worked with his major customers, RMS and suppliers to develop key relationships and continued to sign work contracts which have lasted decades. This interaction with his external stakeholders shows that Tom has an entrepreneurial mindset with that described by Sandra A. Matheson in her formula where she mentions relationships are key for success when starting a business today (Matheson, 2013).
At the beginning of the interview, Tom was asked what his personal mission was when he first got a stake in his family business. He exclaimed with a grin ‘to grow and develop the business. Of course, make as much money as I could'. Here it is shown clearly how Tom has the desire to make money and drive to achieve with his business. This is discussed in the specific traits of an entrepreneur to prosper (Hines, 2004) where it is established the desire to make money is somewhat confused with greed, however for an entrepreneur greed is what enables them to survive and achieve for the business. The desire is different from greed as it is the will to accomplish goals and create a profitable business (Hines, 2004).
Tom has of course encountered setbacks along his entrepreneurial life as managing director, when asked what the worst was he said, ‘We did have a large accident in 1998 where a machine we moved for a customer was destroyed but insurance payed out $250,000 so everything turned out fine in the end.' From his answer and his expression, I believe Tom shows the entrepreneurial trait of Tenacity by being able to overcome the pressure he faced with this situation and remaining positive to keep his business running as usual while dealing with crisis (Hines, 2004). Therefore, this example shows how Tom Clark is an entrepreneur.
Tom was given the chance to identify what he thought his three best entrepreneurial qualities were. He mentioned his financial background, people skills and knowledge of what he was doing through experience. These three qualities are seen in the inherent and essential qualities for an entrepreneur (Hines, 2004). Education, intelligence and the skill of being able to communicate with others effectively is analytical for the management of a business by an entrepreneur. These qualities, particularly Tom's knowledge and experience learned from his Father have ensured the success of the business and the reason why it is still running today.
In Conclusion, an Entrepreneur is someone who makes decisions to seek out scarce opportunities for a want or need in a new market and gathers resources to make the product or service a reality. Entrepreneurship first began around 17,000 BCE in New Guinea where locals exchanged obsidian for weapons and other needs. However, studies of entrepreneurship aren't researched until the medieval period in the fifteenth century.
The entrepreneurial mindset is all to do with developing ideas and taking risks. It particularly involves being well prepared, having an international network of colleagues, being a self-directed learner, creating businesses that are sustainable and having key relationships (Matheson, 2013). The characteristics of an entrepreneur are subjective and differ in opinion. There are four essentials; honesty, intelligence, skillfulness and education. These are essential for the success of a venture. The traits that are preferred and common in entrepreneurs include a positive energy level, ego, courage, enthusiasm, desire to make money, creativity, resourcefulness, tenacity and leadership qualities.
Tom Clark, the part-owner at TJ Clark and Sons displays all essentials and many of these traits mentioned above. He is an entrepreneur due to his position of taking on a family business and running it successfully through the hardship including the end of the mining boom and the global financial crisis. Tom presents the entrepreneurial traits of positive energy level, ego, desire to make money, creativity, tenacity and leadership qualities. He has kept strong ties with suppliers and customers through developing relationships and attending social events. Tom is motivated everyday by the strong family connection he has with TJ Clark, he enjoys working with his brother Mick and family friends. He loves his trucks and taking on the latest in modern machinery to make his work more efficient, safe and environmentally sustainable. Lastly, Tom has been devoted to leading the business through the 21st century in a niche market and has been able to sustain a competitive advantage through innovation and embracing change.
...(download the rest of the essay above)