An Analysis of Entrepreneurship - Juxtaposing Diverse Professional Definitions

An Analysis of Entrepreneurship:

Juxtaposing Diverse Professional Definitions

By:

Farah Gosnell

M590

March 13, 2007

Introduction

The definition of entrepreneurship is one that has many experts, from diverse schools of thought, baffled and contentious. These experts, in their respective fields, believe that only their definition holds merit and should readily explain, to the general population, what entrepreneurship means.

This paper will attempt to derive the differences and parallels of the various definitions, from five different areas of expertise and schools of thought, which will include: economics, social, institutional, public, and corporate.

In conclusion, this thought piece gives an example of what entrepreneurship, after much research, means to this author.

Differences and Parallels

The term entrepreneur is derived from the French 'entreprendre', which in its most literal form, comes from the German word 'unternehmen' meaning 'to undertake'. The earliest entrepreneurs, dating back to the 16th century, were explorers engaged by the French military. Over time, paid builders of military bridges, harbors and fortifications, were also considered entrepreneurs (Cunningham). Therefore, the initial entrepreneurs were those employed to perform risky or dangerous jobs.

Consequently, French economists furthered the terminology to include people who bore risk and uncertainty in order to make innovations (Vogel). Hence, at present, it is an irony of economics that most economists cannot agree to a definition of entrepreneurship. This is because entrepreneurship cannot fit neatly into the static equilibrium framework or a "neat" theory in economic modeling.

However, it is important to note that the majority of economists have started using entrepreneurial talent as part of the four factors of production: land, labor, capital and entrepreneurial talent. Entrepreneurial talent has replaced organization, as the fourth factor, because economists believe that entrepreneurial talent is the driving force behind organization. By creatively organizing, entrepreneurs create new commodities or improve "the plan of producing an old commodity" (Lumpkin).

Moreover, now that most economists do believe that entrepreneurs do play a role in every market, in varying degrees, in different forms, and with regularity, a generalized set of entrepreneurship qualities have been developed. Entrepreneurs are risk-bearers, coordinators and organizers, gap-fillers, leaders, and innovators or creative imitators (Burnett).

Thus, it is understandable when one examines a social entrepreneur that he/she exhibits the qualities that have been characterized by economists with the added attribute of altruism. Social entrepreneurs attempt to create social value while embracing the fundamental principles of entrepreneurship. Social entrepreneurs are the innovators and the mechanisms behind social progress for a given society or segment of it.

Inasmuch as social entrepreneurs are innovators for the progress of a given society, institutional entrepreneurship is striving to make academe more of a business venture. This switch to a more entrepreneurial way of operating - being innovative, responsive to the market, and of finding new ways to make money - has caused conflicts to arise. Faculty members, at universities across the nation, feel a certain disdain for treating students as clients or customers. Still, as government support dwindles and the cost of teaching and research increases, virtually all universities and colleges have no choice but to start treating their institutions in a more business-like manner. Presidents of universities and colleges must lay the foundation for change. These leaders should be "opportunity conscious" - trying to anticipate change, identify opportunities, and retain flexibility (Peck). Entrepreneurial universities have leadership that labors to find resources for the entire institution, an enhanced strategy that promotes contract research and consultant work, a diversified funding base, a "stimulated academic heartland" (especially in the sciences, economics, and business) in which faculty member start the process of entrepreneurial activity, and an entrepreneurial culture that develops over time (Kozeracki).

The downside of institutional entrepreneurship that must be addressed is that like any business venture, universities and colleges have the potential of losing money when engaging in an entrepreneurial venture. They, like any business, also run the risk of their leadership losing focus of the mission because making money becomes priority over all else. This can lead to an image problem, if students and parents start believing that the school is increasing tuition and fees just for the sake of profits. In becoming more entrepreneurial, universities and colleges must always conduct themselves in a way that the public it serves trusts that these schools are never losing sight of their earliest vision and are always respecting the value of higher education.

The same holds true for public entrepreneurship. When a government, of any size, decides to become entrepreneurial, it must keep the public that it serves at the forefront of all of its decisions. It seems that when confronting the subject of public entrepreneurship, ethics becomes a major factor in its course. There is example after example of government municipality leaders who have taken advantage of the entrepreneurial process to profit for themselves. This has led to backlash and skepticism among the general public. It is imperative to note that in the past as governments acted in a more entrepreneurial fashion, the risks of incompetence and of corruption increased due to inefficiencies and a lack of ethics by leaders (Frederickson).

Hence, in order for public entrepreneurship to move toward a positive end, there must be responsible risk-taking by the government. Public officials, who are meeting the demands of its citizens, by establishing practical principles and providing ongoing training to ensure that they are acting in an effective and ethical manner, are the prototypic government officials