CHAPTER THREE

THE ENTREPRENEUR

Introduction

Different types of entrepreneurs portray certain characteristics and patterns of behavior which
could be all learned and/or acquired depending on the entrepreneur’s environmental
background.

Entrepreneurs may play various roles in the enterprise. They scan the environment, identify
opportunities, plan, organize resources, oversee production, marketing and liaise with their
employees. They also innovate and bear risk.

This sub-module unit focuses on the types, qualities and roles of an entrepreneur in an
enterprise.

Types of Entrepreneurs
Entrepreneurs have their own typical qualities depending on their social, economic, political
and cultural environment. Each has an independent way of thinking and a unique approach to
decision making and handling situations in the business.

The following are the three main types of entrepreneurs.

i.Craft Entrepreneurs
ii.Opportunistic Entrepreneurs
iii.Egoistic Entrepreneurs

i.Craft Entrepreneurs
Craft entrepreneurs are those who may start a business using their learnt or acquired skills.
They may exhibit the following characteristics:
a. They are of blue collar origin i.e they come from the informal sector of employment.
b. Their education or training background is focused on the current business activity.
c. They may have low or high technology experience.
d. They have a reputation in a specific industry e.g masonry, teaching, engineering.
e. They are marginal people and were mostly associated with fellow workers. i.e they do
not identify with unions.
f. They have limited cultural background and social induction with entrepreneurship.
g. They are not interested in growing their business ie they are not ambitious. E.g
mechanics who have worked in motor factories, leave to start their own simple garages.
h. They insist that for things to be done right, they must be done by themselves
i. They tend to hire people they have known for a long time.
j. They gain their customers through prior relations or personal contacts.
k. They do not hold the lowest post nor are they at the management level in the
organization they worked for.
 ii.Opportunistic Entrepreneurs
Opportunistic entrepreneurs are those entrepreneurs who may scan the environment in
search of a viable business opportunity that may exist. They are creative and very
hardworking and venture in businesses they do not necessarily have skills or training in.
These types of entrepreneurs exhibit the following characteristics:
a. They are of middle class origin
b. Their education involved many different kinds of courses
c. They have a variety of work experiences and they have been through various
educational courses.
d. They have a reputation across the industry.
e. They are more aggressive/ambitious.
f. They have been in senior profile levels in employment.
g. They are previously associated with managers and business owners.
h. They believe that those holding the lower posts in an organization should handle
operations.
i. Their customers are neither gained through prior relations nor personal contacts.

iii.Egoistic Entrepreneurs
Egoistic entrepreneurs venture into business not only because there exists a business
opening but because they would also like to satisfy their ego. They are highly motivated.
These types of entrepreneurs are:
a. They are very eager to experiment upon new ideas.
b. They can acquire material and financial resources to experiment upon new ideas
c. Their economic system is well developed enough to bear the costs of venturing into a
business.
d. They are well networked are able to find new markets and customers with ease.

Qualities of an Entrepreneur
Entrepreneurs portray certain characteristics and patterns of behavior which can be all learnt
and/or acquired. Every entrepreneur may not possess all of the qualities useful to make
him/her successful. The following are the various qualities an entrepreneur may have:

a. Risk taking
An entrepreneur is open to risk in his business. They has to make decisions and implement
plans, the success of which cannot be fully guaranteed. He risks financial, material and
human resources at his disposal in the venture that he undertakes.

b. Autonomy/independence
An entrepreneur by his/her own nature likes to be his own boss and does not want to follow
the instruction of another person without thinking further. This, however, does not mean that
they rejects counseling from others. They wants to try his own ideas and while making
decisions, they has to form his own opinion and a set of course of action. They is ready to
carry the burden of the consequences of the decisions they makes. Independence of thought
is important.
 c. Creativity and innovativeness
entrepreneurs must have an aptitude for searching out new ways and means of doing things.
They must be innovative in their approach to carrying out business activities. To remain
competitive, they must experiment to find out new techniques of production, kinds of
materials, types or variety of products. They attempt to modify the method of manufacture to
accommodate technological developments, discover marketing opportunities, identify sources
of supply and develop sound organizations to meet requirements of the environment.

d. Internal locus of control

Entrepreneurs possess a high internal locus of control. They believe that achievement of
goals is dependent on their behavior or individual characteristics.
NB: A person with external locus of control believes that achievement of goals is a result of
luck or other people’s action. Such a person is not an entrepreneur.

e. Need for achievement

Entrepreneurs believe in achieving the set goals. The need to achieve may be satisfied by
acquiring higher status, succeeding in business, inventing and popularizing a product,
targeting new markets and attracting a greater number of customers. It is the achievement
motive which makes an entrepreneur diversify, expand and innovate.

Keenness to learn
Entrepreneurs analyze the results and try to learn from them. They constantly watch the path
they take. They draw inferences from feedback, information and have alternative plans.

f. Ability to marshall resources

Entrepreneurs have to bring together all the required resources in the right quantities at the
right time. To achieve this, entrepreneurs must have patience, ability to convince others and a
strong conviction that their job is going to be successful.

g. Time-consciousness
Entrepreneurs are interested in timely delivery of results. In order to achieve this they
must complete their activities within a given time.
h. Organizational skills
Entrepreneurs have the ability to organize activities and utilize manpower in order to put
them to productive use.

For effective utilization of resources, the entrepreneur has to build a suitable organization
structure and with it, appropriate manpower.

Hardworking
Starting a business is hard work. An entrepreneur has to cope with the
demanding work of starting a business. Success comes very slowly for those
who are not willing to work hard.
Integrity
Integrity plays an important role in the advancement of any corporation and the lack of it
poses risks of loss of confidence, faith and commitment of employees, clients and colleagues.
Companies can promote integrity by establishing the moral standards expected of its
employees and implementing systems to reinforce these standards. This will entail the
provision of model roles, developing codes of ethical conduct and providing information
channels to report questionable actions. Companies should also include integrity in their
evaluations and consider ethical aspects when formulating long-range plans.

Persistence
Successful entrepreneurs are persistent and hardworking. They master self-discipline to such
extent that if a work is important and related to their goals, they will, eventually, complete it.

Getting things done is the vital link between motivations and their outcome. At times,
entrepreneurs force themselves to choose work over fun, a boring job against a pleasant one,
working on tax papers rather than reading a glamour magazine. This requires a self-control
that many people simply fail to develop in them.

Successful entrepreneurs persist. They understand that it takes time to make it really BIG !!!
They are prepared to go the extra mile and do that little bit extra for which they do not get
paid.

Self Confidence
Self confidence is a key entrepreneurial skill for success. It is easy to become demoralized,
frustrated and resentful if you lack self-confidence.
Self-confidence is concerned with how a person feels about his ability. A successful
entrepreneur believes in his abilities. He is not scared to explore, take risk and take difficult
decisions.
Entrepreneurs are highly motivated to achieve. They tend to be very
competitive.

Information seeking
Opportunity seeking
Honesty
Goal oriented

Role of an entrepreneur in an enterprise

Entrepreneurs play different roles in an enterprise. These include:

a. Initiator
The entrepreneur as the prime mover of the business. He/she is the director of the
enterprise and comes up with ideas which he convinces the members of the organization
to follow. He/she is therefore the promoter of the business.

b. Director
The entrepreneur as a person who engages the participation of others. They knows that
they cannot run the enterprise single handedly. To effectively manage the enterprise, he
requires the knowledge and skills from diverse persons. The entrepreneur incorporates
shareholders incase;
 i. The enterprise is too large for him/her to purchase.
ii. They is not able to purchase the enterprise alone.
iii. They does not want to commit his/her time wholly in the business.

c. Manager
The entrepreneur as the person in charge of coming up with the organizational structure.
The entrepreneur is in charge of developing an effective organizational structure
showing the distribution of the employees’ posts and responsibilities. The
organizational structure is important for effective control and monitoring operation in
the firm and facilitates communication with workers.
- The entrepreneur as the person in charge of developing an organizational design. He
has the role of establishing an effective organizational design reflecting the daily activities
of the organization in relation to time, beliefs and philosophies and how the business relates
with the external environment.

d. Financier
The entrepreneur and the director. He is the controller of all the enterprise activities. He
mobilizes resources needed to start and run a business i.e finances, raw materials, human
effort among others.