Business Entrepreneurs

The entrepreneur is the pioneer, the managers the applier of existing best practices. The entrepreneur
engages in strategic activity, the managers need to focus on tactical or operational activity. The
entrepreneur formulates a strategy, the manager implements that strategy. Business success will depend
on the continuing renewal and application of the entrepreneurial spirits. Business success depends on the
application and an efficient management team. The attrition rate of any new business is extremely high.
In the US, the supporter of the entrepreneurial spirit, numerous new enterprises will fail each year.
However in a long-term historical perspective, business success is short-lived. Only a handful of the
largest companies with break even status existing in any country at the beginning of the twentieth century
will exist today. Even those enterprises that is likely to be unrecognizable as the original creations. The
causes of small-business failure depending on the study cited range from inadequate accounting systems
to inability to cope. Finally Growth of underlying problem appears to be an overall lack of strategic
management beginning with an inability to plan at strategy to reach the customer and ending with a
failure to develop a system of controls to keep track performance.'
What considerations should small business entrepreneurs keep in mind when they are deciding whether
a company should follow a growth or a stability strategy?
The launch of any new ventures, which is best undertaken with a detailed understanding of the resources
available and the strategic actions needed to achieve project objectives. There should be an indication of
what should be done in various contingencies. In other words, a new venture needs to be planned in a
detailed manner. This is situation an above. Frequent lack of any such planning, even significant strategic
management, will help to explain the extremely high attrition rate for small businesses in all types of
economy. Companies may however, choose a stability strategy because the entrepreneur is mostly
generating employment for family members. Providing the family a "decent living, and being the "boss" of
a firm small enough that he or she can manage it comfortably. Finally some business owners don't pursue
a growth strategy because they do not want the loss of control that results from bank debt or the sale of
stock to outsiders.
Question 12
What are advantages and disadvantages of privatization of state- owned business?
The privatization of state-owned business enterprises is likely to continue globally for most of these
enterprises must expand internationally in order to survive in the increasingly global environment. They
cannot compete successfully if they are forced to follow inefficient. Policies and regulations emphasizing
employment over efficiency rather than economically oriented, international practices will emphasize
efficiency over employment. The global trend to privatization will probably continue until each country
reaches the point where the efficiency of business is counter by the effectiveness of the not-for-profit of
economy. However as political motives overcome economic ones, government will likely interfere with

that decision.
Some of the advantages of taking a company from state-owned to a private company are that it will force
the company to operate efficiently without state subsidies. If you do not do so you will go out of business.
You will be forced to compete with other companies and will have to reduce your costs.
Some of the disadvantage is that a company will no longer operate in the public interest. While a state
owned company primarily serves the citizens of the state, the primary goals of a privately operated
company are to make profit. It may make these profits at the expense of its customers without serving
them properly.
A number of not-forprofit organizations in the United States have been converting to profit-making. Why
would a not- for- profit organization want to change its status to profit- making?
Profit firms also enjoy exemptions from various other state, local, and federal taxes. Under certain
conditions, these firms Lead benefit from the tax deductibility of donors' contributions and membership
dues. In addition they qualify for special reduced-cost mailing privileges. These benefits are allowed
because private nonprofit are typically service organizations, which are expected to use any excess of
revenue over costs and expenses a surplus rather than a probe either to improve service or to reduce the
price of their service. This service orientation is reflecting fact that not-for-profit organizations do not use
customer to refer to the recipient of the service.
What are the pros and cons of doing so?
Typically not-for-profit organization will include private nonprofit corporations such as hospitals, institutes,
private colleges, and organized charities as well as public governmental units or agencies such as
welfare departments, prisons, and state universities.
Some of the pros for as a non-profit organization would be, no federal, state, or local taxes, meet the
criteria for special grants and government funding. Encourage donation by providing your donors with a
tax deduction, and protect owners and directors from liability through status as a corporation.
Some of the cons of as a non-profit organization are more involved application and qualification process
that requires payment of multiple fees and costs. Finally you must comply with numerous regulatory
requirements, including submitting annual reports to federal and state agencies. You can only pay
managers reasonable salaries, can't divide profits equally. Will be unable to pay board of directors on
dissolution, must distribute assets to other non-profits.

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"Business Entrepreneurs." 123HelpMe.com. 09 Dec 2014
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