Introduction to Entrepreneurship
Overview of Entrepreneurship
Responding to World Challenges
Today’s world faces significant challenges. This includes environmental challenges, such as climate disruption caused by man-made greenhouse gas emissions, and societal challenges, including rising income inequality and other forms of social injustice. There are several ways that businesses are responding to these challenges.
Some organizations are accepting deteriorating environmental, economic, and social conditions and are managing through the decline by adapting to limitations. Other organizations speak to the need to make choices between what is good for the environment and society or doing what is good for the economy.
However, there are also more proactive, positive responses, including ones that champion business as a force for positive societal change.
Addressing Society’s Concerns
Addressing ecological and social concerns can create business opportunities that benefit both the economy and society. This is one of the core philosophies of sustainable business practices. Sustainable businesses can help address society’s concerns while providing profit-making opportunities for business owners.
Sustainable business is in large part about changing business practices. Successful sustainable businesses are focused on the creation of new products, services, or practices that address or mitigate environmental and social concerns in new ways. Success in implementing sustainable business practices relies on entrepreneurship and innovation.
Relevance of Entrepreneurship and Innovation
Entrepreneurship and innovation are relevant in many different sustainable business contexts. They are fundamental for the success of start-up companies that are providing innovative solutions to meet environmental or social challenges. Entrepreneurship and innovation are also highly relevant for established businesses. This applies all the way up to multinational companies and all the way down to small- to medium-sized companies.
Companies undertake sustainability entrepreneurship for a variety of reasons, including to enhance their brand name and reputation and to benefit financially by being market leaders in business practices that reduce environmental and societal impacts in their sphere of operating influence. They also engage in sustainability entrepreneurship to affect positive societal change.
What is Entrepreneurship?
Entrepreneurship is to a large degree a mind-set, always striving to do new things in an innovative and better way. The meaning of entrepreneurship is derived from the French seventeenth-century term for someone who “undertakes” and more specifically someone who undertakes a specific project or activity.
In the nineteenth century, the French economist Jean Baptiste Say refined the meaning of entrepreneurship to individuals who create value by shifting resources from lower- to higher-valued activities. The higher value activities can be activities that bring value to both individuals and society.
It is the twentieth-century thought on entrepreneurship from Joseph Schumpeter, an Austrian born and then Harvard University-based economist and sociologist, which has most influenced contemporary thinking about entrepreneurship. In Schumpeter’s view, entrepreneurs are innovators who drive the “creative destruction” process, reforming or revolutionizing the pattern of production.
In many respects, sustainable businesses are significantly changing, if not revolutionizing, the patterns of production and service delivery, transforming business practices in ways that benefit the environment and society.
Another helpful view of entrepreneurship is provided by the twenty-first-century management scholar Peter Drucker. Drucker suggests that entrepreneurs always search for change, respond to it, and exploit it as an opportunity.
Entrepreneurs take risks in starting new activities and take on significant personal responsibility. Many sustainability entrepreneurs perceive opportunities emanating from increased public concern about the environment and climate disruption and are responding to this opportunity with profit-making ventures that address these concerns.
Putting these perspectives together, entrepreneurship can be viewed as:
Taking on Risk and Responsibility
Making Better (higher value) use of Resources
Creating New Value that is Meaningful to Customers
Doing it all over again and again
Entrepreneurship is an attitude and drive to pursue opportunity and create something new and of value.
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