GE 211

ENTREPRENEURIAL MIND TEACHER: MARY GRACE S. BAID

COURSE : GE 211
COURSE DESCRIPTION : ENTREPRENEURIAL MIND
UNITS : 3 units

TOPICS : 1. Entrepreneurial Mindset: What it is to Think Like

an Entrepreneur
a. Growth & Fixed Mindset
b. Entrepreneur versus Innovator
c. What is Entrepreneurial Mindset?
d. Five (5) Key Characteristics of an
Entrepreneurial Mindset.
e. Traits of an Entrepreneurial Mindset
f. How to Develop an Entrepreneurial
Mindset

2. Entrepreneurship in the Philippine Context

a. Filipino Cultural Values and
Entrepreneurship

3. Innovation
a. Form of Innovation
b. Types of Innovation

4. Ethical and Social Responsibilities of an

Entrepreneur
5. Legal Issues in Entrepreneurship
a. Branding
b. Packaging and Labeling
c. Intellectual Property

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TOPIC 1: Entrepreneurial Mindset: What it is

to Think Like an Entrepreneur
Review: Definition of Entrepreneurship

What is Entrepreneurship?

“Entrepreneurship is neither a science nor an art. It is a practice.” — Peter Drucker

Entrepreneurship is the ability and readiness to develop, organize and run a business
enterprise, along with any of its uncertainties in order to make a profit.

Section 1: Growth and Fixed Mindset

What is Mindset?

In order to grasp the meaning of entrepreneurial mindset, let us first dig into the meaning of
“mindset”.

A mindset refers to whether you believe qualities such as intelligence and talent are fixed or
changeable traits. It is a mental attitude or inclination. According to Thum (2012) an author of
the book The right mindset, “Your mindset is the sum of your knowledge, including beliefs and
thoughts about the world and yourself in it. It is your filter for information you get in and put
out. So it determines how you receive and react to information.”

Also, Gupta and Govindrarajam (2002) says that a mindset is a habit that requires practice. In
addition, a concept developed by psychologist Carol Dweck (2006) that was popularized on her
book, Mindset: The New Psychology of Success. She says that mindset is a “self-perception” or
“self-theory” that people hold about themselves and mindset can either be fixed or growth-
oriented.

Two Types of Mindset

1. Fixed Mindset - This is when one perceives his talent and abilities as a set of traits. This
person is upholding the idea that his brains and talents alone are sufficient. When
thrown with constructive criticism, this person takes in personally. When they see
others succeed, they believe it was because of luck or other unreasonable advantage.

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Usually, this type of person will acknowledge that he is not good in something in order
to avoid challenge or failure.

Example: "Starting up an online business requires a lot of digital marketing skills and
experience. You are terrible with computers! Are you sure you can do it?"

2. Growth Mindset - This is when one perceives his talent and abilities as a set that can be
improved. This person upholds that when there is constant dedication, sufficient effort
and correct process, there will always be a chance to improve. This person engages
himself in meaningful learning activities and practice. When struck with failure, this
person sees this event as an opportunity for growth.

Example: "I might not be good with computers but I think that is something I can
learn as long as I deeply commit to it. I need to learn the skills and have experience
so that I can succeed."

Section 2: Entrepreneur versus Innovator

How is Entrepreneur different from Innovator?

Entrepreneurs and innovators both embrace new value creation, but they approach it from
slightly different perspectives and roles within the business landscape.

Entrepreneur:
• An entrepreneur is typically associated with creating and managing businesses or
ventures.
• Entrepreneurs often focus on identifying opportunities in the market and building
sustainable enterprises around them.
• They are not solely focused on the creation of new products or services but also on
orchestrating the resources, team, and strategy needed to turn ideas into profitable
businesses.
• Entrepreneurs often deal with various aspects of running a company, including
securing funding, managing operations, and scaling the business.

Innovator:
• An innovator, on the other hand, is primarily concerned with generating novel ideas,
solutions, or products.
• Innovators can be found in various roles within organizations, and they may not
always be directly responsible for turning their innovations into businesses.

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• Their focus is on pushing the boundaries of what’s possible, finding new approaches,
and developing creative solutions to problems.
• Innovators often work on improving existing processes, products, or services, and
they might not be concerned with the broader aspects of business management.

Entrepreneurs often embody both the innovation mindset and the ability to build and manage
businesses, while innovators are primarily focused on generating innovative ideas and
solutions.

The roles and responsibilities of entrepreneurs and innovators can overlap, and in many cases,
successful entrepreneurs are also innovative thinkers who drive new value creation within their
ventures.

It can be observed that entrepreneurs are called entrepreneurs not because of the size or age
of business but because of the business activity which places innovation in the center. This
ability to inject innovation is regarded as the most crucial contribution of entrepreneurs. It is
therefore wrong to ask if one is an entrepreneur but rather ask how entrepreneurial the person
is. Since entrepreneurship involves discovery, evaluation, and exploitation of opportunities, it
becomes even more relevant with the current speed of technology updates. An entrepreneur
continues to discover, evaluate and exploit possible key areas to further the growth of
technology and other sectors.

Section 3: Entrepreneurial Mindset

What is Entrepreneurial Mindset?

The entrepreneurial mindset is a set of skills, attitudes, and approaches that enable you to
identify opportunities, overcome challenges, and make things happen in a variety of settings.

Entrepreneurial Mindset, as defined by Hisrich, Peters and Shepherd (2017), it involves the
ability to rapidly sense, act, and mobilize, even under uncertain conditions. Additionally, H.
Neck, C. Neck, and Murray (2017) defined it as the ability to quickly sense, act, and get
organized under uncertain conditions. Lastly, Bosman and Fernhaber (2018) defined
entrepreneurial mindset as the inclination to discover, evaluate, and exploit opportunities.

The entrepreneurial mindset is all about embracing a relentless drive to solve problems, seize
opportunities, and create value through resilience, adaptability, and continuous innovation

The essence of the entrepreneurial mindset combines creativity, vision, and a bias for action to
transform concepts into real-world outcomes.

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It involves ideation as well as determination, resourcefulness, and execution to bring those

ideas to fruition.

Why is an Entrepreneurial Mindset Important?

The entrepreneurial mindset is a force you can use to drive transformation at every level,
whether you’re just starting your journey, steering a massive corporation, or venturing into the
unknown.

The entrepreneurial mindset is about relentless personal growth, the wisdom in embracing
mistakes, and using that experience and determination to climb even higher.

Advantages of embracing an entrepreneurial mindset:

1. Conquering Challenges
You see, being entrepreneurial means spotting hurdles and rising above them. It’s about
expanding your repertoire of skills to confront a myriad of obstacles. Not only does the
world value resilience – but employers do, too – and it will serve you well in your career
and your life.

2. Unconventional Thinking
Sometimes, my friends, the most profound solutions come from breaking free of the
established norms. By nurturing your creativity, you’ll tackle problems in ways you’ve
never imagined before.

3. Influence and Inspiration

Remember, you don’t need to change the world overnight to make a lasting impression.
As someone with an entrepreneurial spirit, your skills can spark a meaningful
transformation within your team and community, becoming a source of influence and
inspiration.

4. Stronger Self-Identity
When you embrace the entrepreneurial spirit, you take charge of your ideas, goals, and
dreams. You intimately understand your purpose, strengths, and areas where you can
grow, fostering profound self-awareness. With this kind of self-confidence, you’ll not
only elevate your own abilities but also elevate those around you.

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Section 4: Characteristics of an Entrepreneurial Mindset.

These characteristics collectively define the entrepreneurial mindset, enabling individuals to
identify opportunities, solve problems, and drive positive change in various aspects of life and
business.

Five (5) Key Characteristics of an Entrepreneurial Mindset:

1. Innovation
Entrepreneurs are innovative thinkers who constantly seek new and creative solutions
to problems. They are open to change and view challenges as opportunities for
innovation.

2. Risk-Taking
An entrepreneurial mindset involves a willingness to take calculated risks. Entrepreneurs
understand that risk is inherent in business and are prepared to step out of their
comfort zones to pursue opportunities.

3. Proactive Orientation
Entrepreneurs are proactive individuals who take initiative and seize opportunities. They
do not wait for things to happen but actively shape their circumstances and outcomes.

4. Resilience
Resilience is a key characteristic of entrepreneurs. They are prepared to face setbacks
and failures but use these experiences as learning opportunities and bounce back with
determination.

5. Vision
Entrepreneurs possess a clear vision of what they want to achieve. They set ambitious
goals, create plans to realize them, and maintain a long-term perspective on their
journey to success.

Section 5: Traits of an Entrepreneurial Mindset

These three traits of the entrepreneurial mindset are:

1. Solutions-Oriented
An entrepreneurial mindset is characterized by its focus on finding solutions. Individuals
with this mindset are not deterred by challenging conditions; instead, they approach
problems with curiosity, creativity, and critical thinking. They actively seek knowledge,

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are action-oriented, and view adverse events as opportunities. They also emphasize
creating value for others by solving problems, fostering a sense of community, and
surrounding themselves with positive influences.

2. Adaptable
Entrepreneurs are adaptable and embrace change. This adaptability is essential because
the business landscape is constantly evolving. It’s not about discarding management
principles but rather cultivating leaders who can be both entrepreneurial and
managerial when the situation demands it. An entrepreneurial mindset keeps the core
mission in sight even in the face of change, allowing for flexibility and responsiveness.

3. Anti-Fragile
Contrary to what the term might suggest, being anti-fragile is a positive quality for an
entrepreneurial mindset. It means that individuals with this mindset not only withstand
challenges and uncertainties but also thrive and grow stronger because of them. They
don’t just survive adversity. They use it as a catalyst for improvement and innovation.

The Entrepreneurial Mindset is Anti-Fragile

According to Bill Aulet, managing director of the Martin Trust Center for MIT Entrepreneurship,
anti-fragile has four parts:

1. Heart — The confidence to say when change occurs that it’s not something to survive,
but rather “this is what we were built for,” Aulet said.

2. Head — The understanding that when change happens, it’s time to act and have a plan
of what you’re going to do.

3. Hand — “It’s not enough to know what to do when we go into battle,” Aulet said. “We
have to be able to do it.” It’s converting the head’s knowledge into the capability to get
things done.

4. Home — Building a community that can help you get resources, particularly those
beyond your control. Know what to do, have the ability to do it, Aulet said, “then you
have to be able to marshal the resources very quickly to do it.”

The Entrepreneurial Mindset Embraces Uncertainty

The most fundamental thing to embrace as an entrepreneur is uncertainty. Rewards and risk go
hand in hand.

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Entrepreneurship is inherently uncertain, and success often involves navigating through

uncharted waters, facing unexpected challenges, and taking calculated risks.

Embracing uncertainty means being comfortable with ambiguity, adapting to change, and
continuously learning from both successes and failures.

It’s about having the resilience and mindset to persevere in the face of unpredictability while
remaining open to new opportunities and possibilities.

The Entrepreneurial Mindset Embraces New Value Creation

New value creation is a key driver of entrepreneurship. Entrepreneurship often revolves around
identifying opportunities to create something new or improve existing products, services,
processes, or business models.

This focus on innovation and value creation is what sets entrepreneurs apart from traditional
business owners.

Entrepreneurs seek to fill gaps in the market, solve problems, or address unmet needs by
introducing novel and valuable offerings.

Whether it’s through the development of innovative technology, the creation of unique
products, the provision of specialized services, or the reimagining of how business is done, new
value creation is at the heart of entrepreneurial endeavors.

This emphasis on value creation not only benefits customers by offering them better solutions
but also contributes to economic growth, job creation, and progress in society.

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Section 6: How to Develop an Entrepreneurial Mindset

These practices are grounded in the core principles of entrepreneurship and can help you
develop a powerful entrepreneurial mindset that drives success and innovation in various
aspects of your life.

Here are the five highest-value, pragmatic ways to practice and cultivate your entrepreneurial
mindset:

1. Embrace Challenges and Failure

Seek out challenges and problems to solve in your personal and professional life. Be
unafraid to take calculated risks and accept that failures are valuable learning
experiences.

Cultivate resilience by viewing setbacks as opportunities for growth and innovation. Use
failures as stepping stones toward future success.

2. Continuous Learning and Adaptation

Stay curious and committed to learning. Regularly explore new subjects, industries, and
perspectives. Embrace change and adapt to evolving circumstances.

Cultivate a growth mindset by believing in your capacity to learn and adapt. Challenge
your existing beliefs and be open to new ideas and approaches.

3. Creative Problem-Solving
Encourage creative thinking by regularly brainstorming solutions to everyday challenges.
Seek out diverse perspectives and opinions to generate innovative ideas.

Cultivate your creative problem-solving skills by honing your ability to identify problems,
consider multiple solutions, and select the most promising ones.

4. Vision and Goal Setting

Set clear, ambitious goals for your personal and professional life. Develop a vision for
what you want to achieve and create actionable plans to reach those goals.

Cultivate a long-term perspective by regularly revisiting and adjusting your goals.

Maintain a strong sense of purpose and direction in your pursuits.

5. Effective Decision-Making
Make informed, strategic decisions by gathering relevant information, analyzing risks,
and weighing potential outcomes. Avoid indecision and be decisive.

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Cultivate your decision-making skills by seeking feedback, learning from both successful
and unsuccessful decisions, and refining your decision-making process.

Entrepreneurs having an Entrepreneurial mindset are:

1. Opportunity Hunter – They discover untapped opportunities in their field or in an

industry.

2. Innovation Driver – They creatively solve complex problems and makes decisions that
challenges the status quo

3. Risk Taker – You are prepared to take well-calculated risks to propel your goals forward.

4. Resilience Builder – When you faced with setbacks and failures, you bounce back and
use these experiences to your advantage

5. Ambiguity Navigator – You embrace and thrive in situations filled with uncertainty and
ambiguity

6. Adaptability Champion – In a rapidly changing world, you employ strategies to stay

adaptable and flexible

7. Visionary Leader – You can articulate a compelling vision that inspires and guides your
business or venture

8. Time Master – You effectively manage your time, ensuring it’s focused on high-impact
activities

9. Innovative Thinker – You open to adopting new ideas and perspectives to foster
innovation

10. Collaboration Maestro – You take steps to cultivate productive collaborations and build
strong relationships for shared success

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TOPIC 2: Entrepreneurship in the Philippine

Context
Filipino Cultural Values and Entrepreneurship

In exploring the entrepreneurial mindset, it is important to consider a person’s cultural

mindset. The following are Filipino values that are favorable to entrepreneurship.

1. Pakikipagkapwa.

This trait is about how a person treats and relate with the people around him. This also
encompasses the following:
a. concern for hiya (loss of face)
b. pakikisama (togetherness or companionship)
c. pakikibagay (adjusting or adapting to other people)
d. pagmamalasakit (concern)
e. utang na loob (sense of gratitude)
f. amor propio (self-esteem)
g. bayanihan (cooperative spirit)

Pakikipagkapwa promotes the ideals of entrepreneurship because the person’s main

concern is providing better products and services so that he may not experience loss of
face (hiya). The togetherness or companionship (pakikisama) practice improves the
entrepreneur’s network and the reach of his business. The person’s ability to adjust or
adapt to other people’s ways will also help the entrepreneur provide more relevant
products and services as he could understand the needs and wants of these targets.

Moreover, the concern (malasakit) of a Filipino is also helpful in his entrepreneurial

endeavors as this will push him to go the extra mile in order to provide services and
products to his customers. The customers often have different needs and an extra touch
will make customers delighted.

Furthermore, the sense of gratitude (utang na loob) will often make an entrepreneur
look back and offer social responsibility projects. In addition, a Filipino with high self-
esteem often attracts more customers to trust in his displayed confidence. Lastly, the
cooperative spirit (bayanihan) of Filipinos is essential in his entrepreneurial activities as
this will make him more involved with his community and strengthen his ties with his
current target market.

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2. Risk-taking (Lakas ng Loob).

This trait is about pursuing a business without 100% assurance that everything will turn
out right. People without guts will shy away to new opportunities for innovation in
offering products and services. The Filipino term “Bahala na” exemplifies this trait. This
term projects optimism and not fatalism as this “Bahala na” is often followed by
“remedy” (improvisations) along the way. While giving their best, Filipinos also use the
popular phrase “nasa Diyos and awa, nasa tao ang gawa” (look to God for compassion
and to man for action).

Moreover, gaya-gaya (copycat) is also attributed to Filipinos. This trait however is also
helpful for Filipino entrepreneurs as this is the easiest way to prepare and train an
entrepreneur. When a person is copying the best practice of others, he gains more
confidence or lakas ng loob and continue the journey of entrepreneurship.

Furthermore, the Filipino trait pakikipagsapalaran (sense of adventure) and close family
ties add to this risk-taking tendency of Filipinos. The send of adventure drives them to
pursue innovative undertakings and the knowledge that their family will support them
boosts their confidence.

3. Katapatan (Sincerity).

The strong spiritual and moral values evident among Filipinos demands us to be honest
in our different dealings. This trait moves the Filipino entrepreneur to avoid dishonest
and exploitative ways.

Moreover, this trait also promotes smooth labor-management relations. The

entrepreneur offers fair salary and expects a good and honest service from his
employees. On the other hand, the employees also render his honest service and
expects fair treatment.

4. Social Mobility.

Social Mobility means “the degree of difficulty or easiness a society or group of people
allows a member to go up or climb one social level to another”. Filipinos love rags-to-
riches stories and get inspired by stories of people with humble beginnings. This trait
breeds entrepreneurial dreams and talents.

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5. Sipag (deligence), Katipiran (thrift or frugality), Pagkamatiisin (patient, with

endurance) and Pagtitimpi (self-control).

While Filipinos often hear the stories of “Juan Tamad” (Lazy John), Filipinos also have
ways to deal with the followers of Juan. Filipinos have the saying “Ang kasipaga’y
kapatid ng kayamanan” (Industry is the twin of prosperity) and “Ang tamad namamatay
sa gutom” (The lazy man starves to death).

Moreover, the “katipiran” (thrift or frugality) among Filipinos is also exemplified in the
popular saying “Kung may sinuksuok, may madudukot” (Put aside something today and
tomorrow you’ll have something to draw from”. In addition, Filipinos are also known for
their enduring trait. Most work hard for the promise of giving their families a better life.
Lastly, Filipinos are known to have good tolerance. This is good as entrepreneurs face
challenges in emotional and physical pressure of the business undertaking (SERDEF,
2007).

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TOPIC 3: Innovation
Learning Objective:
1. Distinguish between creativity, innovation, and invention.
2. Explain the different types of innovation
3. Identify the different forms of innovation.

Creativity, Innovation, and Invention

Creativity comes in many forms. It can be messy, but creativity is an essential element of
innovation and inventiveness, both of which can drive entrepreneurship.

We enter the world as curious beings. However, as we grow up, we are told to color inside the
lines and that real animals can’t talk—direction that can squelch creativity. Many successful
entrepreneurs work to unlearn some of those messages in order to tap into creative thinking.
What do you do when you are given a task that requires you to be creative? Do you get out
your art supplies and start drawing? Do you pull out your phone or get on your computer and
head straight for a search engine?

What’s the difference among the term Creativity, Innovation, and Invention?

Concept Description
Creativity ability to develop something original, particularly an idea or a
representation of an idea, with an element of aesthetic flair
Innovation change that adds value to an existing product or service
Invention truly novel product, service, or process that, though based on ideas and
products that have come before, represents a leap, a creation truly novel
and different

Creativity

Entrepreneurial creativity and artistic creativity are not so different. You can find inspiration in
your favorite books, songs, and paintings, and you also can take inspiration from existing
products and services. You can find creative inspiration in nature, in conversations with other
creative minds, and through formal ideation exercises, for example, brainstorming.

Ideation is the purposeful process of opening up your mind to new trains of thought that
branch out in all directions from a stated purpose or problem.

Brainstorming is the generation of ideas in an environment free of judgment or dissension with

the goal of creating solutions, is just one of dozens of methods for coming up with new ideas.

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Entrepreneurs work with two types of thinking:

1. Linear thinking—sometimes called vertical thinking—involves a logical, step-by-step

process. Linear thinking is crucial in turning your idea into a business.
2. Lateral thinking is more often creative thinking, free and open thinking in which
established patterns of logical thought are purposefully ignored or even challenged. You
can ignore logic; anything becomes possible. Lateral thinking will allow you to use your
creativity to solve problems that will arise.

Examples of creativity are all around us. They come in the forms of fine art and writing, or in
graffiti and viral videos, or in new products, services, ideas, and processes. In practice, creativity
is incredibly broad. It is all around us whenever or wherever people strive to solve a problem,
large or small, practical or impractical.

Innovation

According to the management thinker and author Peter Drucker, the key point about
innovation is that it is a response to both changes within markets and changes from outside
markets. For Drucker, classical entrepreneurship psychology highlights the purposeful nature of
innovation. Drucker summarized the sources of innovation into seven categories.

Firms and individuals can innovate by seeking out and developing changes within markets or by
focusing on and cultivating creativity. Firms and individuals should be on the lookout for
opportunities to innovate.

Drucker’s Seven Sources of Innovation

Source Description
The unexpected Looking for new opportunities in the market; unexpected product
performance; unexpected new products as examples
The incongruity Discrepancies between what you think should be and what is reality
Process need Weaknesses in the organization, product, or service
Changes in New regulations; new technologies
industry/market
Demographics Understanding needs and wants of target markets
Changes in Understanding needs and wants of target markets
perceptions
New knowledge New technologies; advancements in thinking; new research

Example:

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McDonald’s was one of the first to launch these self-serve kiosks. Historically, the company has
focused on operational efficiencies (doing more/better with less). In response to changes in the
market, changes in demographics, and process need, McDonald’s incorporated self-serve
cashier stations into their stores. These kiosks address the need of younger generations to
interact more with technology and gives customers faster service in most cases.

What are the advantages of innovation?

• Keeping processes organized: By being innovative in how you perform processes,

especially if you use technology, you create standards and systematize the best work
method for your brand. And this is crucial for strategies to be successful, results to
be achieved, and goals to be reached.
• Developing creativity: With innovation, a company shows that it's open to changes
and that employees can contribute with new ideas and see in practice the benefits
new things can bring to the day to day.
• Increasing the business’s competitiveness: By adopting strategic resources, a
company becomes more attractive to customers, partners, and talents and gains a
competitive advantage in the market.
• Increasing productivity: Innovation proposes more effective processes, more
production control, effective strategy, and more engaged employees.
• Adding value to a product or service: When you innovate, you boost the marketing
of products and services, because you bring something different and unique for your
target audience.
• Increasing profits: With more productivity, a more attractive business, and more
effective management, your business will consequently see greater profits.

Invention

An invention is a leap in capability beyond innovation. Some inventions combine several

innovations into something new. Invention certainly requires creativity, but it goes beyond
coming up with new ideas, combinations of thought, or variations on a theme. Inventors build.

Diffusion of Innovation

Diffusion of Innovation - explains the rate at which consumers will adopt a new product or
service. Popularized by Everett Rogers, an author and scientist

1. The innovators - are the ones willing to take a risk on a new product, the consumers
who want to try it first.
2. The early adopters - are consumers who will adopt new inventions with little to no
information.

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3. Early and Late Majority adopters - will adopt products after being accepted by the
majority.
4. Laggards are often not willing to readily adopt change and are the hardest to convince
to try a new invention.

Diffusion Chasm - an innovation must target a specific audience, or segment, and solve a
specific problem. The most critical point of adoption often occurs at the end of the early
adoption phase, before the early majority steps in and truly confirms (or not) the diffusion of an
invention.

Section 1: Types of Innovation

1. Disruptive Innovation
This type of innovation follows the market more than a specific brand, product, or
service. It can be leveraged by something a company has offered and, as a result, made
their name, but, in general, it's a scalable change that reaches many people at the same
time.

2. Reverse Innovation
A product was first introduced in developed countries and later introduced in
developing markets.Innovations developed in and for low-income, developing markets
are later successfully adapted and adopted in the high-income, developed markets.

3. Incremental Innovation

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It adds new features to a product, brand, or production methods without promoting a

very drastic change.

It's usually an evolution of an innovation already implemented by the brand that

complements and offers improvements, be it to employees, customers, or features of a
business.

4. Breakthrough Innovation
This innovation happens when a new product or service that has never existed appears
in the market.

Companies with excellent research and development teams usually deliver this kind of
innovation.

5. Radical Innovation
A radical innovation really changes the circumstances of a brand, whether in terms of
market or of business dynamics.

It can occur due to a complete change in a company's positioning, work method,

processes, services, and products offered, or how it relates to customers.

6. Open Innovation
This innovation occurs when a company taps the internal and external ideas to improve
their current operations. This collaboration in innovation usually happens in automobile
production.

Section 2: Forms of Innovation

These innovative activities could be in the form of the following according to Schumpeter
(1942) new goods, new methods of production, new markets, new sources of inputs, and
new types of organizing

1. Product innovation
Easily noticed, product innovation actually brings something new to the market.
Television, for example, was something innovative when it was invented, bringing
image, sound, and entertainment into people's houses.

It was a radical innovation that, with acceptance of the public, became disruptive and
over time began to rely on incremental innovation. The whole world followed the
release of different kinds of TV: color, cable, flat-screen, and, today, smart TV.

2. Service innovation

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A visible example of service innovation is food delivery. For a long time, in order to eat
something from a restaurant, customers needed to walk into the place or order takeout.
That's when the market innovated and offered delivery service so that customers could
order whatever they wanted with just a phone call. Over time, it became possible to
order food on websites, and now we can order food on mobile apps at our fingertips.

3. Innovation in production processes

Here it is interesting to highlight environmental awareness. Many cosmetic brands, for
example, innovate by implementing cruelty-free processes that don’t involve animals.

4. Innovation in business model

Innovation in the business model is very common in startups. A simple example would
be marketplaces. Virtual stores like Amazon mediate between buyers and sellers.
Another example would be virtual banks. Today, there are many financial institutions
with no physical facilities for customer service and whose transactions are all performed
online.

5. Technological innovation
Technological innovation is the most evident kind of innovation. The advance of
technology brings about many opportunities. Thinking back a few centuries, the
Industrial Revolution springs to mind as a good example, since it changed production
methods in companies, work methods, and even workers’ lives. In a modern context,
though, the primary examples are the internet and smartphones, which revolutionized
not only products and services, but also society's behavior. Technological innovation, as
we see in the case of Industry 4.0 technologies, enables us to take steps that would
otherwise be unachievable with human power alone.

6. Logistical innovation
For a long time, it would take up to a month to receive a letter by mail. For international
products, it would take an average of three months. To change this, companies and
distributors innovated in logistics, creating storage points and strategic distribution
centers. Today, there are apps to hire delivery services and even delivery drones!

7. Marketing innovation
Ways of acquiring new customers have evolved, and we're seeing more and more
innovations in marketing. Sometimes, the way you advertise can be innovative. With the
creation of social media, for example, lots of brands innovated by advertising on those
platforms instead of newspapers and television.

8. Organizational innovation
Organizational innovation brings several other kinds of innovation. They concern
structural changes and practices that improve productivity, services, products, and

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processes. Home offices are an example of organizational innovation, as are

management software, customer service chatbots, and trainee programs in which
employees get to know all departments of a company before actually working in one of
them.

TOPIC 4: Ethical & Social Responsibility of an

Entrepreneur
Shareholder
- a person, company, or institution that owns at least one share of a company's stock or in
a mutual fund.
- a small group who are the owners (or stockholders)

Stakeholder
- a party that has an interest in a company and can either affect or be affected by the
business. The primary stakeholders in a typical corporation are its investors, employees,
customers, and suppliers.
- a large group that includes all those people and organizations with a vested interest in
the business.
Ethics
- a branch of philosophy that is concerned with human conduct, more specifically the
behaviour of individuals in society.
- the behavior you expect of yourself, in both your professional and personal life, you are
engaging in a philosophical dialogue with yourself to establish the standards of behavior
you choose to uphold

Business Ethics
- The moral principles, policies, and values that govern the way companies and individuals
engage in business activity.

- Guides the conduct by which entrepreneurs and their companies abide by the law and
respect the rights of their stakeholders, particularly their customers, clients, employees,
and the surrounding community and environment.

Ethical Theory by Immanuel Kant

Duty-based ethics – emphasizes the underlying intent or reason behind a decision and whether
that decision is good or bad.

1. Utilitarian ethics – focuses on the usefulness or utility of the decision.

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2. Protestant work ethics – looks at the decision from the viewpoint of capitalism, free
markets, and a sense of duty to ensure maximum return on investment.
3. Virtue ethics – claims that ethics consists of a series of innate but latent virtues that an
individual needs to develop overtime.

Moral compass
- is a state of mind where an individual has developed the needed capabilities to
differentiate between right and wrong, or between just and unjust in challenging
circumstances.

To develop and internalize a moral compass, an entrepreneur and the members of the
organization need to continually exercise and develop their ethical “muscles.” These ethics-
based muscles include qualities such as trust, truthfulness, respect, responsibility, commitment,
care, love, and justice.

Profit Sharing
- What Is A Profit Sharing Bonus?
- Profit sharing is an employee bonus that eligible employees receive over a set time
period (quarterly or annually). The compensation paid to the employee depends on the
profitability of the company over that time period and how their profit sharing plan is
set up

Corporate Social Responsibility

- is a business model that helps a company be socially accountable to itself, its
stakeholders, and the public.

There are many examples of CSR initiatives in the Philippine outsourcing industry. Some
companies have established CSR committees or departments to oversee and implement these
initiatives. Typical focus areas include environmental sustainability, employee well-being, and
community engagement.

Social Entrepreneurship
- Social entrepreneurship describes ventures launched by entrepreneurs who are first and
foremost advocates or champions for a social cause.
- This new breed of entrepreneur leverages the power of their position, their standing in
the community, and the potential synergy and wealth-creation power of an enterprise
as a vehicle or platform to advance their social goals and personal agenda.
- These social causes often include a solution for a costly and chronic social problem or
pain, a social wrong or injustice that must be corrected, or a global issue that has been
either overlooked or marginalized by society or organizations.

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TOPIC 5: Legal Issues in Entrepreneurship

Unlike working in a large corporate environment with an established structure, entrepreneurs
often create and operate a new business venture by their own rules.

Philippine antitrust laws, primarily governed by the Philippine Competition Act (PCA), are
designed to prevent business practices that could harm consumer welfare or impede fair
competition.

The Philippine Competition Act (PCA) or R.A. 10667

- is the primary competition law of the Philippines for promoting fair competition in the
marketplace and protecting well-being of consumers in the process.

RA 7394, The Consumer Act of the Philippines

- This Act, consisting of 173 articles divided into six Titles, establishes the Consumer Act of
the Philippines. The policy of the State aims at protecting the interests of the consumer,
promote his general welfare and to establish standards of conduct for business and
industry.

Branding

Branding
- is the process of creating a distinct identity for a business in the minds of your target
audience and the general population.

It gives your organization an identity, makes your business memorable, encourages consumers
to buy from you, supports your marketing and advertising, and brings your employees pride.

Brand
- is a name, term, design, symbol or any other feature that distinguishes one seller's good
or service from those of other sellers.

Trademark Registration
By registering a trademark, a brand gains exclusive rights to use specific signs (like words, logos,
or symbols) to distinguish its goods or services from those of other entities. This prevents
others from using a confusingly similar mark without permission.

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The trademark symbol ™ is a symbol to indicate that the preceding mark is a trademark,
specifically an unregistered trademark.

The registered trademark symbol ® which is reserved for trademarks registered with an
appropriate government agency.

Packaging and Labeling

The Philippine Consumer Act requires related agencies to enforce additional labeling
requirements for other products, including food, cosmetics, and hazardous substances.

- The Generics Act (Republic Act No. 6675) regulated labeling requirements for drugs.
- Republic Act No. 7394 "Consumer Act of the Philippines," Article 77: provides for the
minimum labeling requirements for consumer products.
- Republic Act No. 7394 "Consumer Act of the Philippines," Article 108: The State shall
protect the consumer from misleading advertisements and fraudulent sales promotion
practices.
- Republic Act No. 7394 "Consumer Act of the Philippines," Article 110: An advertisement
shall be false, deceptive or misleading if it is not in conformity with the provisions of this
Act or if it is misleading in a material respect.

Intellectual Property
Intellectual property (IP) rights are created by federal law and protect small businesses from
problems such as this. IP law also helps establish brand awareness and secure secondary
revenue streams.

Intellectual property (IP) is the output or result of the creative work of one or more individuals
to turn a unique idea into a practical and value-added product/service; this manifestation of
original ideas is legally protected.

IP can take the form of a patent, a copyright, a trademark, or a variation thereof called a
trademark secret.

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