What is Entrepreneurial Career ?
Entrepreneurship is still not considered as a lucrative career by most of the people including entrepreneurs. When an individual initiates any enterprise, it can be seen as a career as this new venture starts a new passage, a way of life and a field of pursuit. Some people invest their whole life in it while some live here only for a short time period.
Entrepreneurship is not considered as a career for most of the individuals because generally, career process of entrepreneurship starts at different phases of life; some individuals start it early and some start in later half of their life. The current students face a lot of critical consequences due to this "career unevenness" and "career non-recognition". In fact, most of the successful entrepreneurs were not able to take the career of entrepreneurship when they were in their student life.
The mentality of an individual to become an entrepreneur and start a venture of his own, rather than working for other's is a result of a life event, key motivation, or a source of inspiration. Entrepreneurship can be considered as having a married life with the enterprise. There is no limit of working hours for an entrepreneur. Ones the business is settled, his generations can continue with the same and earn prospective benefits. However, if the enterprise does not prove fruitful to them, the business venture may require to be shut down.
Most of the young people are now starting their own enterprise due to lack of opportunities in the formal sectors. This can be seen as the fastest growing field at present. One can have good fortunes in long run and can select his or her own limits: There is abundance of scope and variety of planning and managing the work on our own.
Choice of Entrepreneurship as a Career
Willingness to initiate, experiment and innovate regularly are the main requirements of self employment. In order to meet the ever changing demands and situation on a regular basis, it is very important to be decisive and innovative all the time. The term entrepreneur can also be explained as a person who is self-employed and this is the reason behind considering self-employment as a part of entrepreneurial career.
If an individual chooses entrepreneurship as a career, he will experience something which is altogether different from the conventional jobs in any organisation. Commitment to the venture, risk taking, readiness to face the volatility of the venture, performing multiple rules at a time (like worker, sales person, accountant or owner), decisiveness. etc., are the key features of entrepreneurial career. That is why, some entrepreneurs find it challenging to be in this career.
Having greater freedom, flexibility in the life, more money and avoiding organisational politics and bureaucracies are the main driving forces behind self-employment. But it does not mean that it is always advantageous. Problems like difficulty in maintaining the work-life balance and job autonomy, loss of social life, and handling various responsibilities are the main concerns which one has to deal with while being a self-employed individual.
Positive and Negative Aspects of Entrepreneurial Career
The both positive and negative aspects of entrepreneurial career are discussed below :
1) Positive Aspects :
The various positive aspects associated with entrepreneurship as a career are as follows :
- The entrepreneur enjoys the decision-making power. He/she is the boss of the organisation and can take any kind of decision. No one is there to order him/her.
- A number of self-development opportunities are there before the entrepreneur.
- The satisfaction achieved by getting the rewards for work done by self is very different than in a job.
- One can receive higher monetary advantages than his/her competence, capabilities, and expectations.
- One would earn lot of respect and honor from his friends and family members, which can be seen as an intangible benefit.
- One becomes able to offer jobs to others. instead of working under someone.
- He can also play a vital role in the economic, social and structural development of the country and feel proud about it.
- By fulfilling the career goals and proving the achievements, one can be a great achiever.
2) Negative Aspects :
The different negative aspects associated with entrepreneurial career are as follows:
- Despite being the boss, an entrepreneur is not a real boss of himself/herself as he/she has to work as per the desires of financiers, suppliers, customers, labourers and so on.
- Sometimes due. limited resources, organisational activities will tend to be limited which will create sense of frustration in the in the entrepreneur.
- Entrepreneur has to spend long hours in office to make his/her enterprise sustainable which can hamper his/her family and social life.
- As it is not necessary that whatever entrepreneur plans happens in same manner thus, frustration and depression arises sometimes.
- Due to involved risk in the entrepreneurial venture, a kind of tension is always there.
Factors Favouring Entrepreneurship as a Career Option
The major factors which add to the attractiveness/favouring of entrepreneurship as a career option are stated below :
1) Greater Need for Independence :
There are some individuals who want freedom while selecting where, how, with whom and in what conditions to work. This can be seen as a cue which motivates these individuals to go for entrepreneurship as a career option.
2) Desire to Have High Financial Rewards :
Another factor attracting the individuals towards the entrepreneurial career is the desire to have high financial rewards. Generally, individuals prefer to have high financial reward for their efforts in work. It is not possible in a regular job, which is why individuals are attracted toward the entrepreneurial career.
3) Opportunity to Handle Different Aspects of a Business :
Idea generation, conceptualization, designing, marketing as per customer demand and satisfying customers are the key aspects of a particular business. There is almost no other job opportunity which can provide the exposure to these aspects of the business. That is why, individuals shift to entrepreneurial career to have experience of these business aspects.
4) Achievement Orientation :
Achievement orientation is also a favoring factor for the entrepreneurial career. Some individuals are hardworking and motivated and that is why, they desire to grow quickly. There present job does not provide them satisfaction of utilizing their skills and talents and thus, they look for independent businesses.
5) Desire to Implement Ideas :
Individuals are attracted towards the entrepreneurial career because of the desire to implement their own ideas in the business. By becoming entrepreneur, a person can produce a product from his ideas. The short supply of any product can be recognized by entrepreneurs and they can make efforts in fulfilling the shortage gap. They have a motivation and self belief of serving better products or services which is not offered by the current producers and thus, they initiate new ventures.
6) Job Insecurity :
Another reason for choosing entrepreneurial career by individuals is that they feel insecure about the current job in a particular organisation. Due to insecurity about the future of the organisation they shift to self-employment.
7) Family Business :
Individuals having family business may also shift to entrepreneurial career as they are already exposed to entrepreneurial environment. After completing their studies and having some experience in the industry they may start their own venture.
8) Risk-Taking Attitude :
Risk cannot be avoided by the entrepreneurs and thus risk-taking ability can be seen as the most significant trait of an entrepreneur. However, the nature of risk tends to vary from one industry to other and it must be analysed in the beginning. The entrepreneurs are mainly driven by their risk-taking attitude.
9) Lucrative Government Policies :
When infrastructural facilities and financial assistance are offered by the government, it can provide the individuals with better career prospects and financial benefits as compared to conventional jobs, then the individuals can choose to become an entrepreneur.
10) Vision to Leave a Long Lasting Mark :
Individuals are also attracted to the entrepreneurial career because it can make them able to leave a mark on the society. By starting an enterprise, they offer an employment opportunity to the public and improve their living standards. The urge to innovate and improve the living standards of the society makes the society entrepreneurs famous among the general public. The enterprise of the entrepreneur becomes self satisfying, profitable and engaging because of the inner urge, feasible business idea, logical planning and hard work.
Entrepreneurship as a Style of Management
Entrepreneurship can be defined as an approach to management in which attempts are made to accomplish the various opportunities, without giving any major consideration to the available resources. Any type of firm can have entrepreneurial value creating activities. Focus on a particular opportunity. focus on change and its management in the whole organisation are the three key characteristics of entrepreneurship as a style of management. In order to direct and control such organisations, different interrelated and interdependent tools like power, leadership and motivation used by the are entrepreneurs.
Entrepreneurial management is focused towards grabbing the opportunity, introducing a change in the organisation and managing the organisation completely. Enterprise owners and managers add value to themselves (through establishing new ventures) or to the organisation (through introducing new product lines) by exploiting the available opportunities in the market and in this way; they add a new dimension to the management.
In various organisational cultures, responsibility of decision-making and taking initiatives are provided to the :
1) Establishing Team Spirit :
One of the activities which can be undertaken by the entrepreneur establishing team spirit. High level of team spirit can be established in an organisation when all the individuals associated with the organisation accept that they are working together in a team, and by doing so (i.e., by coordination), all goals can be accomplished. Effectively communicating the various activities with each other in a team helps in reducing the nervousness. Open and regular communication can be seen as a two-way path. Another way of building a strong team spirit by entrepreneurs is by listening to the views, suggestions, and other things running in the heads of their employees or team members. This means that an entrepreneur should welcome suggestions from their employees on matters relating to effectively managing the growth and performance of the business.
2) Providing Feedback :
A regular constructive feedback must be given to the employees so that the quality of their work can be improved. However, such feedback must not create any negative impact on the minds of employees in terms of fear of failure. In fact, a reverse feedback should also be looked by the entrepreneurs. Honesty must be present in the feedback to be considered as an effective one and thus, an environment which gives importance to honesty and open communication must be developed. This method should be encouraged by the entrepreneurs who wish for high growth of business and have confidence in their abilities to achieve the same.
3) Assigning Responsibilities to Others :
Since an entrepreneur has to deal with a large number of inevitable activities, therefore, it is difficult for him to get involved in all managerial decisions. Some responsibility of taking initiatives should be delegated to the important employees without the fear of being unsuccessful. This will require the creation of a culture in which employees are rewarded for taking initiatives and failures are seen as a chance of improving rather than being punished.
4) Regular Training for Employees :
The ability and capacity of the employees can be enhanced with the help of regular training and thus, the chances of enhancing the growth rate of the organisation will also increase. The new management style must be reflected in the training with the help of involvement of employees in decision-making regarding the topics of training.
5) Increasing Productivity :
The entrepreneurs can increase the firm's productivity with the help of management support in determining the important tasks to be accomplished on priority. basis.
6) Increased Job Satisfaction :
When all the major tasks are completed effectively, it gives an impression of improved level of productivity which further improves the level of job satisfaction among the entrepreneurs. It fills the entrepreneurs with a positive feeling due to the increasing number of activities undertaken by the firm. A greater level of job satisfaction can be achieved with the help of accomplishment of more important activities and growth of the firm to new stages.
Changing Role of the Entrepreneur
With the increasing level of growth and development in an organisation, the role of entrepreneur also keeps changing, and it is also important to update the role of entrepreneur according to the changing needs of the organisation. These changes should not only include the changes in his interaction with the employees but also with the external entities (suppliers, financiers, customers, etc.). In fact, these changing roles and responsibilities are not stationary and as the firm grows, there will be changes in these. aspects and entrepreneur should also develop accordingly. Both the manner and the extent in which different activities are undertaken by an entrepreneur change with the growth and development of the organisation.
The relationship of entrepreneur with the business and its employees is required to be changed from time to time in order to provide better chances for growth. As the activities to be performed everyday by the entrepreneur are changed by the growth, it will also change the focus of entrepreneur resulting in the requirement of new skills. These skills are different from the ones which were required in the initial phase of the enterprise.
Hence, redefining the role of entrepreneur due to growth and development of the organisation can be explained under the following dimensions :
- A shift from a hands-on practitioner to the leader and then to become the coach or mentor of other employees and associates.
- Becoming a general manager from functional expert and again becoming functional expert and finally evolving as culture or strategy conductor.
- Having trust in oneself and others along with believing in the importance of making efforts to achieve something valuable and not only in terms of money.
Early Career Roles and Dilemmas
There are a number of confusing and new roles which has to be encountered by an individual while starting their career as entrepreneurs. Management of stress and tension associated with this career is mainly dealt in personal dilemmas. Apart from this, there is a sense of insecurity and confusion which. arises due to the new roles of being business owners as well as managers which is encountered by these entrepreneurs.
This career also has its effect on the family of entrepreneur. In the funding of new setup, financing is done from the family funds which can put the family under pressure. Individuals generally start with their entrepreneurial endeavors between the ages of 20 to 30 years. This is the time when the people generally plan for getting married and have babies. Thus, individuals who are working as an entrepreneur have to face the pressure of maintaining the balance between their family and work. There are many entrepreneurs who say that they did not manage this dilemma effectively and gave importance to business over their families.
The main concerns in the initial phases of business are related to resource management such as labour. capital, raw materials, etc., for effectively initiating the new venture. The most significant problems faced in the initial stages were found in the study of Kazanjian as related to sales, marketing, and finance problems. The time management of the entrepreneurs depends upon the stage of the development of the enterprise as suggested by McCarthy, Kruger and Schoenecker. The main focus remains on the issues related to the customer in the beginning than in the later stages. For having a successful entrepreneurial career, the individuals should manage their role of being the owner effectively and should interact regularly with the owners of other enterprises
Mid-Career Roles and Dilemmas
We can observe a change in the roles of entrepreneurs during their mid-career. These roles generally involve the activities such as administrative tasks, solving employee problems, business growth and strategic planning. More tension and stress of changing roles are experienced by the entrepreneurs when they start dealing with the greater administrative responsibilities. Such type of stress due to increased responsibilities results in building a feeling of isolation among the entrepreneurs. A recurrent sense of profound loneliness was found in almost 54 per cent of entrepreneurs in the study conducted by Boyd and Gumpert (1984).
With the help of information, system and culture, new forms of control can be implemented in the growing organisation for having a better control over operations. The feeling of not having control over the expanding business is experienced by many. entrepreneurs. In order to accomplish higher growth rate of business, the entrepreneur should be able to efficiently delegate work to his employees. Sometimes, in order to manage the growing operations of the developing firms, some external managers who have expertise in their field can be hired.
This will also result in some kinds of issues as these managers may have different orientation and values than the entrepreneurs. In many studies, it is found that the failure or success of many firms depends upon the ability or inability of entrepreneurs to combine the skills of professional managers with their business.
Late Career Dilemmas
A lot of stress is experienced by individuals during the time of retirement or sudden separation from their career. These experiences include adopting a set of new roles at the personal, professional, and family front. Many times, we can see cases where these frustrated entrepreneurs tend to commit suicide and end their lives. In a study conducted on the entrepreneurs who had graduated from Harvard University, it was revealed that 25 per cent entrepreneurs were not interested in retiring or were not planning retirement before the age of 65 and more than 48% individuals were not planning to retire in their entire life.
The phase of anger, denial, depression, acceptance and bargaining may be faced by the entrepreneurs. However, there are various entrepreneurs who never accepted their mortality and they started preparing both their family and the business to operate efficiently in their absence. In a study conducted by Trow in 1961, it was concluded that those businesses which have not planned well for their succession had to suffer financial losses as a consequence, in comparison with those businesses which had appropriate plans regarding the same. In fact, it was found in many studies that if the succession is not planned adequately, it would hamper the business in a great deal.
Defining Survival and Success
In complementarity research, there were two meanings associated with the success as suggested by Amable, Ernst, and Palombarini. These two meanings are economic success and simple survival (with resistance to change). Operationalising the idea of success was presented by Amable, according to which businesses get compatible as they do not incorporate changes in their processes. But the real successful organisations are those which inherent the ability to adapt to changes. Thus the question might be asked that if there will be some changes in the conditions; the business will be unable to adapt itself to the changes. As per evolutionary theory, there are two kinds of species, one which are able to adjust with the changing environment and the other which have the ability to change the environment.
Entrepreneurship also faces the old saying that success has many friends and failure has none. It is not easy to have the systematically generated success and failure statistics and additional research. A number of opportunities are provided for the entrepreneurial success but the fact is its associated risks cannot be avoided and an entrepreneur will have to face these risks. In a research conducted by Small Business Administration's Office of Advocacy, it was found that almost two-third of the new enterprises survive only a life span of two years and the other 44 per cent survive for minimum four years. Thus, it is clear that most of the businesses (more than 50 per cent) do not survive more than four years and it is true for almost all the industries.
This is a common notion that the rate of failure of a restaurant is much higher than any other business line. But in real, the survival rate of the hospitality and leisure businesses, which include restaurants, is approximately equal to the average survival rate of businesses. There are various driving forces behind entrepreneurial success. These forces generally include having sufficient funds, educational level of owner, ability to produce the products meeting the demands of customers, desire to be self-employed and independent as well as freedom to manage time for the family as per one's own wish.
The success of a business greatly depends on the experience of the owner with the business. A better understanding of buying the goods and services can be seen in case of experienced business professionals. They have good understanding of selling and marketing their product or service, negotiating with suppliers, raising money, and managing finances. The business may fail due to lack of experience of running business despite having a good idea of products and services. This means that lack of business knowledge generally leads to the failure of majority of the entrepreneurs. There is huge difference between managing a business and having expertise related to products and services. Therefore, the entrepreneurs must be equipped with necessary skills and experience so as to capitalize the opportunities when they appear.
Survival Strategies for Entrepreneurs
The various strategies which can be used by entrepreneurs for the survival of their ventures are as follows :
1) Management of Cash flow:
One of the important strategies to be followed by entrepreneurs is managing the cash flow. The firm is bound to fail due to non-payments of bills irrespective of the amount of surplus funds they may have. In order to pay rents, electricity charges and other dues, it is important to have cash in hand. In events where cash is required on an urgent basis, the firm will face many difficulties no matter how much capital is with it in the form of bank loan promises, property, clients who owe money, forthcoming orders, etc. The overall financial health of the firm can be managed effectively with the help of appropriate accounting and cash flow management.
2) Target the Sales :
The rate of survival can be improved with the help of better sales but it does not mean to avoid the other functions, however, sales is the most important function among all. Merely having an attractive salesman skill will not help in boosting the sales level. However, enhancing the sales level in the business can be achieved through effective CRM (Customer Relationship Management) systems, having sense of integrity and commitment while selling the products, etc. CRM systems help in identifying important customers and other potential customers.
3) Prepare a Financial Strategy :
Often it happens that during the time of some urgent needs, entrepreneurs are left with no finance, although it s readily available in ordinary time period. Thus, they should prepare a financial plan during their good times to face the uncertainties in future. Some of these financial plans may include :
- Saving excess money,
- Account opening with the suppliers,
- Having credit cards,
- Extending the business overdraft by bank loan.
4) Look for New Clients :
Most of the firms feel comfortable in having two or three main clients as these firms know each other well: their requirements and the main issues, but one should not forget the uncertainty of the business. One should always look for new clients or customer so that the business keeps running despite the failure of one of the major clients.
5) System Development :
Almost all the activities have to be handled by the entrepreneurs in the initial phases of the business and it is very important for them to spare time from all these activities so that they can focus on expanding business. This can be done by having some systems in line which will help in delegating various functions such as Customer Relationship Management (CRM), bookkeeping, accounting, marketing, production management, and so on This will help the entrepreneur to handle the main activities and delegating other activities of less sensitive nature to others.
6) Improve Business Skills :
For a successful business, an entrepreneur not only needs to focus on the craft but also on enhancing the business skills. He can learn such skill with the help of various product-related training programmes available around him. For example, no matter how delicious food is served by a South-Indian restaurant, but if the owner does not own required business skills, he is likely to fail in his business.
7) Time-Out :
No doubt hard work and commitment are the essence of any business, but entrepreneurs should not ignore the much needed break. They should go for holidays from time to time which will not only revitalize their enthusiasm and creativity, but will also test the stability and strength of their business. If the business remains in motion in the absence of entrepreneur, it can be taken as a positive sign regarding the strength of the business. Instability and vulnerability can be experienced in that business where constant supervision from the businessman is required.
Reasons for Entrepreneurial Success
The success of any enterprise depends heavily on the external acknowledgement and freedom, and not on greed and lucrative yet fake traps. Many successful entrepreneurs believe that although money is a good measure of success yet it is not the whole world. The various reasons for the success of entrepreneurs are as follows:
1) Competitive Advantage :
Success cannot be achieved only on the basis products and services. There must be an analysis of what are the different factors which distinguish the firm from other competitors before, initiating any venture. The entrepreneurs keep on trying to gain expertise in their endeavors which can help referral them in achieving success. According to Entrepreneur magazine, greater opportunities and sales will be there when one has a greater level of perceived expertise. Therefore, we can say that in order to succeed, an entrepreneur needs to develop competitive advantage.
2) Well-defined Purpose :
The fundamental of any business plan or transaction depends on the well defined objectives and it can be seen as the main reason for its success. In the absence of well defined dream, objective, target or mission, it is very difficult to become successful.
3) High Speed :
The main reason for reaching greater heights and attaining milestones depends upon the speed with which the activities are undertaken by an entrepreneur. No work should be left unless it is completed and appropriate speed while executing should be maintained. The ones who utilize their time optimally are considered to be most productive, and it is closely related to the proper management of working hours.
4) Appropriate Financial Management :
Efficient management of financial and money matters determine the success of the enterprise. There should not be any unexpected expenses and all the aspects of the business should have their own budget. Impulsive spending of money and loss of control over the monetary flow are the main reasons for failure of the business.
5) Social Skills :
The success of any entrepreneur also depends upon his or her social skills. It is quite useful to have contacts with the influential and powerful individuals. Successful enterprises always have a close interaction as they know the importance of cooperation. Following the advice's of other professionals can also prove a critical factor in achieving success.
6) Self-Discipline :
Self-control is the basis of self discipline and it is the outcome of self-imposed personal parameters. Despite working in the best economic situations, the success of business is doubtful without discipline. Different types of obstacles can be overcome by the entrepreneurs having self-discipline. Positive work ethics which leads to effective and efficient performance is possible with self-discipline.
7) Strong Determination :
Success also depends upon strong determination which is recognized by the successful entrepreneurs while initiating any business. Despite the failure to meet various expectations, an entrepreneur never stops making efforts until his goals are achieved.
8) Adequate Capital :
Cash can be considered as blood to business and if a business does not have enough cash, it may fail. The successful entrepreneurs always maintain adequate amount of cash flow to manage and run all business activities smoothly.
9) Strong Focus :
Another reason which leads to success of an entrepreneur is initiating business with complete focus. Entrepreneurs generally wish to engage themselves more than one business, but in such cases their focus is divided and none of the business endeavor is accomplished effectively. Therefore, it becomes important for an entrepreneur to develop a strong focus.
10) Risk Taking and Confidence :
Risk taking ability is the foundation of the success of any business. Risks are taken by the successful entrepreneurs when it is related to their businesses. successful entrepreneur will never be afraid of taking risks and the choices made by him, as he believes in his decisions and hopes. that these will yield him greater profits. The entrepreneurs are well aware with the saying "no pain no gain". They are those individuals who always persist with their vision.
Guidelines to Achieve Survival and Success
A lot of important lessons are learnt by the entrepreneurs while being an entrepreneur. The main nine principles stated below are considered to be the most vital for achieving long-term survival and success :
1) Make a Plan and Make it Great :
Plans should be made according to the targets as failure generally a result of improper planning. The successful entrepreneurs always have a better planning in comparison to failed businessmen. This planning is neglected by many businessmen by which different activities of the business can be synced together. Failing to plan will result in failure of the business.
2) Develop Understanding of Financial Information :
It is very important for an entrepreneur to have a better understanding of different financial information which can be used in managing daily operations. This will help him in understanding the performance of business and in planning for the future.
3) Get to Know the Customers :
Giving personalized attention and significance to the customers can be seen as one of the most basic elements which can decide the success of any enterprise in comparison to other competitors. With the help of activities like giving personal attention to the customers, responding to their calls, making efforts to know more about their tastes and preferences, getting their feedback, etc., an entrepreneur can develop a customer base and influence the customers become loyal.
4) Always Learn Something New :
An entrepreneur should never stop learning. He should be engaged in learning new things and skills from different sources. It will be very beneficial for the entrepreneurial career irrespective of the performance of the business.
5) Grab Attention :
Just by running various promotional activities for a long-term for increasing the awareness is not good for the businessmen as it will result in wastage of money and time. If this is pursued, there are greater chances of running out of funds before the fulfillment of the goals. In fact there must be some earnings from every activity which is undertaken for the promotion of the business in order to have greater business and attracting more attention.
6) Design the Workspace for Success :
In order to ensure increased level of personal performance and improved productivity, office space must be utilized in an effective manner. This will also help in creating a professional impression on the clients who visit the premise.
7) Follow-up Constantly :
Every entrepreneur must focus on maintaining a regular contact with the employees, management team and business associates. They should be engaged in follow-up and follow-through with the prospects, and business alliances. The prospects can be converted into customers with the help of proper follow-up and thus, the value of every sales activity can be increased along with improved frequency of buying. Thus, one can have a better relationship with the suppliers and other business stakeholders.
8) Decide Even with Limited Information :
An entrepreneur should be able to use the limited data for effective decision-making. As the situations change, the entrepreneurs need to change their business strategies as per the demand. In such conditions, the entrepreneurs should not sit quietly but use the available data to design the future plan. Any kind of delay in decision-making may result in the loss of certain opportunity.
9) Learn from Mistakes :
One cannot gain from. every gamble and every business does not gain success in this manner. Learning from the past mistakes can be seen as a critical factor for the success of the business. Investors will be worried if entrepreneurs are not able to fulfill these concerns as the various problems and issues are not discussed with them once the business starts running.
10) Understand Weaknesses :
Being involved in every aspect of the business is quite common for an entrepreneur who proclaims himself to be a multi-tasker. Here, it is also very important to have a better understanding of when to involve oneself and when to delegate the issue to others for resolution. The expertise in one area is mainly identified by an entrepreneur, for example, finance, sales, marketing, and operations. The experts can be hired in the other fields, where the entrepreneurs lack expertise.