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Entrepreneurial Competencies | Definition, Competency Requirement for Entrepreneurs & Developing Entrepreneurial Competencies

Entrepreneurial Competencies

What is Entrepreneurial Competencies ?

The term "competency" can be defined in a number of ways. These definitions are governed by specific hind of tasks carried out by the individuals under varying situations. Various traits like skills, knowledge, abilities, and similar characteristics together constitute to components of competency which are elementary for the success and effectiveness of job performance. These traits have the potential to differentiate between the best and the rest of the performers. They are also observable and enable in nature. An individual who is ready to take certain amount of risk for earning profits and achieving success in his entrepreneurial venture is known as an entrepreneur.

Definition of Entrepreneurial Competencies

According to Bird :
"Entrepreneurial competencies defined as underlying characteristics possessed by person which result in new ventures creation, survival and/or growth".

Hence, these competencies comprise pf "applied" knowledge or the behavioral implementation of knowledge that initiates success. Furthermore, competencies constitute only the exposition of skills that generate favorable outcomes. Moreover, competencies comprise of evident behaviors associated with motives and therefore they are not just work motives.

According to Spencer and Spencer :
"A competency as an underlying characteristic of an individual that is causally related to criterion referenced effective and/or superior performance in a job or situation".

Therefore entrepreneurial competencies are comprised of collection of related skills, attitude, knowledge, and expertise which can be obtained through management training and development programmes and which facilitate generation of exceptional performance and escalate profits of the business venture. With view to to execute all the entrepreneurial functions efficiently, an entrepreneur should possess these attributes/traits known as entrepreneurial competencies. Such attributes and behaviors calls for nothing less than excellence in terms of entrepreneurial performance.

Competency Requirement for Entrepreneurs

An entrepreneur achieves success with the help of competency requirements. Specific core competencies are essential for an entrepreneur to become a recognized or known person. Different competencies required in an entrepreneur are as follows: 

Competency Requirement for Entrepreneurs

1) Superintendence 
An entrepreneur should be able to manage the resources or production means and provide maximum output with the minimum costs All the activities of the organisation should be supervised by him/her.

2) Leadership : 
Another core competency required by entrepreneurs is the leadership ability. The capability of leading staff members and other associates is a must for any entrepreneur. He/she must have the power to direct and control others in performing business activities and accomplish success.

3) Decisive : 
An entrepreneur should possess very good decision-making power successful. Sometimes he/she has to take several to become decisions simultaneously. Any kind of uncertainty or doubt by the entrepreneur might influence the business. He/she should take decisions in a resolute and determined manner. In addition, entrepreneurs should restrain themselves from getting influenced by others. They must take all important decisions individually without any support.

4) Risk-taking : 
Any type of business includes several risks; therefore, every entrepreneur should have the risk-taking ability to willingly handle such risks. Business involves lot of financial investments and naturally a business person has to be cautious while making such investments. At times, an entrepreneur may fail to benefit his or her business venture but if he/she is able to take full advantage of the same, then he/she has so much to achieve both in terms of financial matters and from one's own happiness point of view.

5) Confident : 
Confidence is also a core competency required in an entrepreneur. Lot of confidence and conviction is essential for attaining success in business. Whether it is a businessman or business woman, he/she should have no doubts about accomplishing the pre-determined goals and objectives for success. Whenever a person is confident, his/her self-image improves.

6) Willingness : 
Any matter related to business venture must be readily taken up by an entrepreneur. Personal or any other causes should not be the reason for unwillingness or reluctance. Willingness to support or offer assistance is very necessary for achieving success.

7) Enterprising : 
Remarkable success in business. can be attained only if the entrepreneur is enterprising and creative in nature. Passion and appetite for success is essential. Casual or unconcerned approach will not be helpful for a business venture.

8) Innovative : 
Novel and unconventional ideas are the main reasons for attaining success in business. In order to achieve success, an entrepreneur must be ingenious and always try to find better means to improve possibilities of attaining success.

9) Integrity : 
The business decisions made by entrepreneurs are based on the clear set of values and viewpoints of those entrepreneurs. These beliefs and outlooks have an impact on all the actions taken by them, especially during challenging and testing times.

10) Conceptual Thinking : 
The entrepreneur is ready to employ new, unconventional techniques, think of incredible ideas that can just work thereby resulting in progressive changes or considerable developments. He or she is willing to try or open to new ideas without any preconceived notions.

11) Networking : 
A successful entrepreneur is the one who understands the importance of networking in a business venture. Networking is a major business activity which is capable of providing access to right information, sales. collaboration and proficiency. Thus, thorough planning and research are always beneficial in attaining desired outcomes.

12) Commercial Aptitude : 
An entrepreneur must be well-informed with current advances in the sector, search for best practices, and most importantly discover and seize opportunities that are not apparent to other players in the market.

13) Optimism : 
Along with different hurdles and hitches, an entrepreneur always follows his/her target and mission. His vision is to function from a desire to achieve success instead of a fear of failure.

14) Customer Sensitivity : 
Building faith, trust and long-term associations with customers is the main duty of an entrepreneur. He/she also develops a belief of high level of customer service and repeatedly outperforms customer expectation.

15) People Focus : 
With the help of shared vision and moral standards, an entrepreneur develops a mutual purpose with his/her peers. He/she always takes into the principles of comprehensiveness in planning and controlling others; he/she walks the talk, establishes the total ability of the immediate and wider team and values the best in others.

Awareness of Self Competency

Knowledge, skills, and abilities together constitute to form self-competency which enables self-assessment of one's strengths and weaknesses. Self-competency aids in determining and accomplishing both personal as well as professional goals and objectives. It helps in maintaining a work-life balance and also enables the individuals in undertaking new learning processes such as new or improved attitudes, behaviors, and skills.

Forming or initiating a business venture and maintaining it successfully is the prime job of an entrepreneur. Various changes taking place in the business environment have a major influence on business ventures and every entrepreneur has to alter his business strategies and plans in accordance with these environmental changes. In order to realize these modifications, the entrepreneur has to most importantly get acquainted with his own and weaknesses. Once he is familiar with these he can enhance and upgrade his his competencies and work on his weaknesses. 

Self-competencies are the personal traits and characteristics which inspire and stimulate an individual to become a successful entrepreneur Awareness is nothing but a state or potential to feel, to understand or to have consciousness towards sensory trends, objects and events. With certain level of consciousness, an observer can affirm sense data without any definite and implicit understanding Predominantly, awareness is a state or a quality of being conscious of some events happening around.

With reference to the above discussion, awareness is the foundation of finalization of any activity and hence with regards to strengthening entrepreneurial competencies, it is it is vital to have awareness about these requisite entrepreneurial competencies. Having awareness about the entrepreneurial competencies is also essential because these competencies provide an opportunity to individuals to acquire fundamental information regarding the skills, capabilities and qualities required to become a successful and competent entrepreneur After acquiring this fundamental information, a person can evaluate whether he has these capabilities innate in himself or which can be Such fundamental information also enables the individuals to comprehend about the important competencies required to be possessed by them.

Assessment of Competencies 

Measuring the competencies of an individual is known competency assessment These measurements involve job knowledge tests, bis-data instruments, diagnostic and promotion tests, mental ability tests, estimation of social skills, customer service skills and structured interviews. Assessment of human resource selection has become more important with the emergence of increased responsibility towards manpower decisions. The role of human resource management's research and development personnel is to formulate selection methods. They are professionals who create methods which can be customized to particular needs of an agency. The selection methods formulated by these experts have certain features which are as follows :

1) A complete range of job-related abilities involving social skills and reasoning aptitude together constitute to selection criterion. Different formats of selection criteria are as follows : 
  • Structured interviews,
  • Multiple-choice tests, either computer-based or paper and pencil, 
  • Bio-data questionnaires,
  • Job-knowledge tests,
  • Physical performance tests,
  • Social skills inventories,
  • Executive assessment centers, 
  • Language-learning ability tests,
  • Professional examinations for managers and executives.

2) The selection method also involves complete documentation procedure and validation of the documents and the information provided.

3) Office of Personnel Management (OPM) formulates policies and procedures related with the personnel, and provide them with information regarding their pay available opportunities. Test administrators rates and having a strong network across the nation efficiently and competently manage and direct tests of OPM design.

Developing Entrepreneurial Competencies

Success of an entrepreneurial venture is greatly dependent on the qualities and competencies possessed by the entrepreneurs. Some of these qualities are inherent or inborn, while others can be learned through education, and training and development programmes. Prof. Davis C. McClelland conducted the famous "Kakinada Experiments" which manifested this fact quite substantially. Human behavior and performance is in consonance with the competencies. There are list of ways or approaches through which different competencies can be inculcated or developed.

The most significant ways employed for developing entrepreneurial competencies are as follows : 

1) Gaining First Hand Knowledge about Competencies: 
It is impossible to develop different competencies without distinctly interpreting their meaning, importance, and implications. A diligent and dedicated attempt should be made by an entrepreneur in order to thoroughly comprehend different competencies, which are necessary to systematically perform the given job.

2) Competency Recognition : 
The various competencies possessed by an individual govern the behavior or performance of that individual. Hence, it is important to first identify or recognize the requisite competencies that an individual should possess for performing in the desired manner. Thus, in simple terms, in the competency recognition phase, an attempt is made to identify the competency required by an individual.

3) Self-Assessment : 
Once the competencies necessary for a specific type of behavior are identified, an entrepreneur must evaluate the degree up to which he possess these competencies and till what level he is utilizing these competencies while accomplishing his objectives and goals.

4) Comparison of Competencies : 
After self assessment, a comparison is made between competencies possessed by an individual with those competencies which necessary to accomplish the pre-determined performance levels. In case any imperfections or shortcomings are noticed, a sincere attempt should be made to ascertain the causes for the same.

5) Developing Competencies and Feedback : 
The final step is to develop those competencies which the individual has identified are not present in him but are essential for a deriving a desired entrepreneurial behavior. Formulating methods and resources for generating the requisite competency can be done with the help of different behavioral scientists. The individual who does not possess the required competency is asked to practice the required competencies on regular basis, until it becomes part of his behavior.

After following the entire process of developing the required entrepreneurial competencies, one should seek to analyse how much change has taken place in an individual's behavior after acquiring the necessary competencies, and to what degree it has been beneficial. The desired competency can become a part of the personality or habit of an individual if it is exercised on a continual basis.

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