CHAPTER ONE

INTRODUCTION TO
ENTREPRENEURSHIP
 At the end of this lesson, students should be able to:
a) Define the concept of entrepreneur and
entrepreneurship
b) Differentiate between businessman and
entrepreneurs
c) Explain the roles and social responsibilities of
entrepreneur towards customers, society, suppliers,
staffs, competitors and country.
A society that has entrepreneurs is considered to be
a successful society. This is because entrepreneurs
are individuals who are creative, dynamic and
innovative. They are willing to take risks and face
unpredictable and uncertain challenges by using
their creativity and will power.
Entrepreneurs would develop and penetrate new
business areas in order to stay competitive in the
industry. Then, more products or services being
offered to the society, which would enhance the
society’s economic development.
 The term has been given various definitions by
management scholars and practitioners.

 It is derived from the French word entreprendre which

means ‘to undertake or to try’. (Richard Cantillon,
1775).

 It also refers to a person who undertakes and operates

a new enterprise or venture, and assumes
accountability for the inherent risks.
 An entrepreneur refers to an individual who establishes a
business and manages it to obtain profit and to be
successful (Carland).

 (Kuratko & Hodgetts), an entrepreneur is an individual

who organizes, manages, and assumes the risks of a
business.

 An entepreneur is an individual who creates a new business

in the face of uncertainty for the purpose of achieving
profit and growth by identifying and capitalizing
opportunities and assembling the necessary resources to
capitalize on the identified opportunities (Zimmerer and
Scarborough).
 The dictionary defines an entrepreneur as an individual
who manufactures industrial products or conducts a
business on a big scale.

 Webster’s dictionary, an entrepreneur is an individual who

manages an economic activity, specifically in sponsoring,
owning, managing, and bearing the risks of a business.

 The Encyclopedia Americana defines an entrepreneur as a

businessman who takes risks to combine the factors of
production such as capital, labour, and raw materials and
accepts the rewards through the profits made by the
market value of his products.
 In 1970s, after the New Economic Policy (NEP), then
entrepreneur was widely used in Malaysia.

 Common definition, “someone who establishes a new entity

to offer a new or existing product/service into a new or
existing market, whether it is for a profitable or a non-
profitable outcome. An entrepreneur is an individual who is
able to perceive an opportunity for a business and create an
organization to develop and manage that business
successfully. He is able to identify and seize the opportunity
and bring in the necessary resources such as finance,
workforce, and raw materials to develop and market the
products or services. He takes proper action that is
imaginative, creative, and innovative”.
 Entrepreneurship is the process of seeking businesses
opportunities under conditions of risk.

 “Entrepreneurship also refers to the process of creating

something new of value by devoting the necessary
time and effort, assuming the accompanying financial,
physical, and social risks, and receiving the resulting
rewards of monetary, personal satisfaction, and
independence”.
 According to Yep Putih, entrepreneurship is the ability,
capability, and tendency to perform the following
activities:
i. Identify business opportunities.
ii. Manage a business effort which brings profit to the
entrepreneur and the public.
iii. Obtain success and richness by fulfilling the society’s needs.
iv. Take calculated risks.
v. Manage and utilize the factors of production to bring
economical development and enhance social welfare.
vi. Work hard and be prepared to make new changes that can
increase production quantity and quality from time to time.
 An individual’s preparedness to grab opportunities without
considering the resources at hand (Stevenson, Roberts and
Grousbeck).

 (Dollinger) defined entrepreneurship as the establishment

of an economical firm that is innovative, profit oriented,
willing to take risks, and face uncertainties in the
environment.

 As a conclusion, entrepreneurship benefits the

entrepreneur, the economy and the society. It is a process
that creates and manages a business to achieve the
entrepreneur’s desired goals.
 Entrepreneurs have to have objectives and targets but these are
subservient to the ultimate objective of acquiring the blessings of Allah
s.w.t. In Islam, to indulge in business is to perform an obligatory duty
(fardhu kifayah); unless & until there is an entrepreneur in a
community, the entire community is deemed to be sinful!
That’s how seriously Islam perceives & encourages entrepreneurship.
Profits are merely incidental in the fulfillment of the fardhu kifayah.
But that does not imply weakened profit motivation among
practitioners.
Profits are encouraged in order to prosper the community through
donations, taxes, tithes & the like. With ubudiah (state of servitude
before God) & tauhid (oneness of God), risk taking becomes a guided
endeavour; regardless of the outcome the entrepreneurial Muslim will
always be humble & redha (contented with what God has given).
In contrast to the Western concept of the Islamic Man.
(Adnan et al., 1992, pp. 32-36)
 ATTITUDE SKILLS KNOWLEDGE
Motivation Decision making Law

Confidence Problem solving Management

Initiative Negotiation Economics

Responsibility Communication Accounting

Risk-taker Creativity Values

Diligence Team work Business

Mental & physical fitness Management Culture

Information-seeker Technical Project management

 An entrepreneur is an individual who seeks profitable
opportunities and takes the necessary risks to establish
and operate a business.

 A businessman main desire is to grow his business.

 A manager is responsible for using the organization’s

resources to accomplish the organization’s goals.

 So… all entrepreneurs are businessmen BUT not all

businessmen are entrepreneurs.
 CHARACTERISTICS ENTREPRENEUR BUSINESSMAN
Time Unlimited Limited
Nature of job Flexible Rigid in adapting to
changes
Decision making Makes own decision Follows decision made by
others
Effort and commitment Continuous L ow
Risk taker Moderate Low
Goal Maximize s self potential Solely for profit
by utilizing available maximization
opportunities
i. Customers
ii. Society / community
iii. Suppliers
iv. Staff
v. Competitors
vi. Country

(please refer Entrepreneurship page 44-46)

 ‘Entrepreneurial competencies’ refers to key
characteristics possessed by successful entrepreneurs
in performing entrepreneurial function effectively.
Entrepreneurial competencies can be observed from
the entrepreneur’s attitude, internal life values or
his/her insistence to perform with excellence.

 McClelland and McBer & Co. conducted a research on

successful entrepreneurs at Malawi, India, and
Ecuador. As a result, they listed 13 entrepreneurial
competencies possessed by successful entrepreneur.
i. Personal initiative
ii. Seize opportunities
iii. Endurance
iv. Information-seeker
v. High work quality
vi. Commitment towards work agreements
vii. Efficient
viii. Systematic planning
ix. Creative problem solving
x. Self confidence
xi. Assertion
xii. Persuasion
xiii. Power and authority
 Assessment can be given to students by case
study. Students may find good sources of
outstanding entrepreneurs in Malaysia.
 INDIVIDU BERMOTIVASI TINGGI
Cerita-cerita individu yang berjaya di Malaysia…

TAN SRI MOKHTAR ALBUKHARY

Pengerusi & Pengasas YAYASAN ALBUKHARY
• Berasal dari Kedah, merupakan anak
seorang peniaga lembu.
• Orang ke-7 terkaya di Malaysia.
• Tidak tamat sekolah menengah kerana
desakan hidup.
• Menyumbang banyak pendapatannya
kepada masyarakat dan kebajikan.
• Hidup yang terlalu sederhana, tak
suka
publisiti.
• Kuat prinsip :
Kejujuran menjadi asas, tolong-
menolong menjadi pegangan.
 INDIVIDU BERMOTIVASI TINGGI
Cerita-cerita individu yang berjaya di Malaysia…

TAN SRI LIM GOH TONG

Presiden Kehormat & Pengasas GENTING BERHAD
• Lebih dikenali sebagai Uncle Lim.
• Orang ke-4 terkaya di Malaysia.
• Merantau dari Fujian, China ke Malaya
pada 1937.
• Tak berpendidikan, tak tahu membaca
dan
menulis dan tak fasih berbahasa
melayu.
• Semua anak mempunyai pendidikan
tinggi.
• Kuat prinsip :
Apa yang kita fikir untuk buat,
kena buat sampai berjaya walau
apa rintangan yang ada.
Entrepreneur involve in e-business also known as
cyberpreneur.
A cyberpreneur is someone who is starting or
running a business in cyberspace and the
internet. An entrepreneur who has an online
based business on the internet targets
international consumers. These cyberpreneurs
do not need offices or extensive support staff all
over the world. They just need a great idea and
a cable to connect to the internet.
E-business (electronic business), derived from such terms as "e-
mail" and "e-commerce," is the conduct of business on the Internet,
not only buying and selling but also servicing customers and
collaborating with business partners. One of the first to use the term
was IBM, when, in October, 1997, it launched a thematic campaign
built around the term. Today, major corporations are rethinking their
businesses in terms of the Internet and its new culture and
capabilities. Companies are using the Web to buy parts and
supplies from other companies, to collaborate on sales promotions,
and to do joint research. Exploiting the convenience, availability,
and world-wide reach of the Internet, many companies, such as
Amazon.com, the book sellers, have already discovered how to use
the Internet successfully.
 E-Dagang atau lebih dikenali sebagai istilah dotcom
merupakan satu alat / mekanisme yang akan
membantu pembekal perkhidmatan/produk
mengembangkan pasaran produk/perkhidmatan
mereka. E-dagang merupakan satu kaedah transaksi
elektronik secara maya melangkaui sempadan jarak
dan waktu. Dalam suasana maya, syarikat dapat
menubuhkan pejabat secara maya yang dapat
dikunjungi oleh pelanggan pada bila-bila masa dan di
mana sahaja. Pendekatan perniagaan ini merupakan
satu pendekatan yang sangat ideal dan mempunyai
potensi dan ruang yang besar untuk terus
berkembang. Secara mudahnya ia bermaksud “proses
jual / beli secara online.”(Ab. Aziz & Zakaria)
i. Attracts a large number of customers – customer all over
the world.
ii. The company can be visited without time restrictions –
24hrs / 7days throughout the year without encountering
different time zones.
iii. Gives an image of a well-established company – to obtain
customers’ confidence when dealing with the company.
iv. Minimizes management costs – min the management
costs such as phone bill, fax, transportation etc.
v. Disseminates business information – help to spread
business information to individuals within the company
and parties outside the company.
vi. Reduces the size of filling – save storage space in filing
documents; files can be saved in the form of softcopy
and stored in computer systems.
 At the same time,
entrepreneurs can enjoy various facilities such as
electronic mail, online forums, chat rooms, and
information bargains through the library catalogue.
Businesses will be able to store, retrieve, create, and
display information through the server.
By using e-business, companies can send out
information to millions of people.
By surfing website at any time without having to go out
from the building, entrepreneurs can obtain feedback
and improve business operations.
The cost of communication will reduce.
 Lecturers may ask students to discuss with their
members the advantages and disadvantages of
e-business.
 Antara faedah-faedah perniagaan melalui e-dagang ialah:
i. Rakan maya (rakan kongsi & pelanggan)– mempromosi
secara laman web, penyenaraian produk/perkhidmatan
secara online, sepanduk elektronik dan sebagainya melalui
hujung jari anda.
ii. Penajaan - ada juga pemilik laman web lain yang ditaja
oleh syarikat korporat untuk memasarkan
produk/perkhidmatan .
iii. Kaedah pembayaran – transkasi biasanya melibatkan pihak
ketiga seperti bank, syarikat kewangan, dan pengeluar kad
kredit. Memerlukan teknologi pembayaran sebagai contoh
Secure Electronik Transaction (SET) oleh master card &
visa. Di Malaysia kaedah bayaran maya dibangunkan oleh
MIMOS Berhad & Hitechniaga Sdn. Bhd. melalui Jaring’s
Mall.
i. Direct email marketing

ii. Online catalogue

iii. Public relations

THANK YOU
VERY MUCH…