KABWE INSTITUTE OF TECHNOLOGY

SUBJECT: ENTREPRENEURSHIP LECTURER: ELIAS NKHUWA

(0977 825842)
INTRODUCTION TO ENTREPRENEURSHIP

1.0 Topic Introduction

Entrepreneurship center of attention is recognizing a business opportunity and developing

that opportunity into a viable business. The controlling functions—accounting, finance,
marketing, management—as well as legal, moral, social and economic considerations are
applied. Student responsibility and initiative are encouraged as business strategies are
created, planned, and presented as a final product—a business plan for an actual business
venture. Through the process of developing the business plan, students acquire skills
necessary to operate a successful business.

2.0 Introducing Entrepreneurship

The word ENTREPRENEUR originates from the borrowed 13th Century French verb,
ENTREPRENDRE, which means "to undertake" and was first defined by the Irish‐French
economist Richard Cantillon. Jean‐Baptiste Say, a French economist, is believed to have
coined the word "entrepreneur" in the 19th century. Entrepreneurs are typically portrayed as
a risk-loving, hard-working, adventurous bunch. Indeed, "undertaker" (as in someone who
undertakes), "enterprise" and "adventurer" were among the terms used for entrepreneurs
before the English language imported the term we now use from French.

Great attention has been paid to the subject of entrepreneurship over the past few years, as
people have realised that small firms or SMEs are engines to economic growth and
employment, income growth and poverty reduction. Developing countries have established
policies and tax incentives that encourage the planning and implementation of small
businesses with the belief that a small business can potentially grow into a large business.

3.0 Learning objectives

 Define the terms business, entrepreneurship and entrepreneur
 Distinguish between entrepreneurship and intrapreneurship
 Understand entrepreneurial concepts such as creativity, innovation and invention

3.1 Important Aspects of Entrepreneurship

The following concepts are identified as integral to the understanding of entrepreneurship.

Entrepreneurship means that an individual must be able to:

1st. Identify an opportunity ‐ there must be a real business opportunity.

2nd. Be innovative and creative ‐ Something new and different is required that is
needed by a target audience.
3rd. Gather resources ‐ Capital and labour must be found.

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 4th. Create and grow a business ‐ This means the start of a new business venture
or the conversion of an existing business.
5th. Take risk ‐ There will be both personal and financial risks.
6th. Create rewards ‐ Reward can be in the form of profit or increased value of the
business.
7th. Manage a business ‐ There must be planning, organisation, supervising,
leadership and management control of all the functions.

3.2 Entrepreneurship Defined

Entrepreneurship, just like management, has no single definition. There are variations and
in some cases inconsistencies.

What then is Entrepreneurship? Generally people’s response is that entrepreneurship is

about creating or establishing a business. Entrepreneurship, however, is more than simply
Starting or operating a small business as we shall observe.

Entrepreneurship is both a science and an art. The science lies in the established process of
planning and managing business (i.e., something researched, measured and objective). The
art lies in the innovative thought, implementation and growth of a business.

The most common definition is “The art of creating or developing a business through
innovation, creativity, progressive imagination and risk taking initiative”

Note: Entrepreneurship occurs in new as well as old, small and large, fast and slow
growing, government owned, private owned, profit and non-profit organisations (e.g. NGOs)

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 4.0 Important Entrepreneurship Concepts

4.1 Business Defined

The term business is defined as “An organization operated with the objective of making a
profit from the sale of goods or services.” In most cases a potential entrepreneur will be
creating a “small business” that he or she hopes to grow into a large and successful
enterprise.

4.2 Enterprise

Another term for business. This can be classified as Micro, Small and Medium Enterprises
(MSMEs or SMEs). Enterprises are for profit and started by Entrepreneurs. Others are not-for-
profit for instance, social enterprises like NGOs. Enterprises are all legal and registered.
Examples include Large Enterprises, Corporations, Unincorporated, State Owned
Enterprises, and NGOs.

4.3 Definition of Intrapreneurship

Intrapreneurship is a practice that allows employees to act like an entrepreneur within a

company or organisation to come up with an innovative idea, product, service or project. It is
also known as Corporate Entrepreneurship. Intrapreneurs drive the process of
Intrapreneurship, thus are the engines of growth within companies and organisations.

4.3.1 Main Differences between an Intrapreneur and an Entrepreneur

S/N Entrepreneur Intrapreneur

1 Starts their own company Works within the company that was created
by someone else
2 May struggle to find resources despite Has easy access to company resources
having great business ideas
3 Faces more risks May not face the risks associated with the
entrepreneur
4 Most of the rewards go to the company or Retains all the rewards of his or her hard
organisation work

5.0 Creativity and Innovation

In entrepreneurship, Creativity is the spark that drives the development of new products or
services or ways to do business that are new and unique. Creativity is the ability to come up
with original ideas while innovation involves implementing those ideas into new products
and processes. It is continuous learning, questioning, and thinking outside of prescribed
formulas (thinking outside the box).

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Innovation means implementing new business ideas and plans in order to generate profits,
helping the community and accompanying company or organisation goals. Innovation relates
to introducing a new product or service in the market. There is no innovation without
creativity. Creativity is a prerequisite to innovation. Innovation is key to the success of any
entrepreneur.

6.0 Innovation and Invention

Invention refers to occurrence of a completely new idea for a product, a service, a process
and technology that has never existed. Innovation is fruitfully implementing new ideas and
creating value for customers. Invention means creating something totally new whereas
innovation involves the improvement or modification of something that already exists.

7.0 Risk

A risk is defined as the probability that the actual result is negatively different from planned
event. It is a possible, usually negative outcome e.g. hazard. Business risk is the exposure
an Enterprise has to an issue (s) that may lower its profits or cause it to go bankrupt.
Companies use various techniques to identify risks and eliminate or mitigate them
(Calculated risk).

8.0 Business Idea and Business Opportunity

An entrepreneur’s initial task is to scan the environment and come up with new business
ideas. A business idea refers to a concept for a new product or service that has the potential
to generate revenue and create value for customers. It is from the created business ideas
that bring about opportunity identification. However, it is worth noting that good ideas don’t
necessarily make good business opportunities.