Entrepreneurial Theories and Types of Entrepreneurship - Assignment Example

Gracefulness of Entrepreneurship: Focusing on the Types of Entrepreneurial Activities AFFILIATION: Contents Introduction 3 Types of Entrepreneurs 6 Social Entrepreneurs 6 Family Entrepreneurs 8 Lifestyle Entrepreneurship 11 Rural Entrepreneurs 14 Conclusion 15 References 16 Entrepreneurial Theories and Types of Entrepreneurship Introduction Entrepreneurial spirit receives influence from different variables. The stronger impact comes from the culture in that the resultant businesses operate, and the managers have to mold their practices in order to align them according to civic and social needs of the surrounding community (Abdelgawad, et al., 2013). However, in the light of resource dependence theory, one can argue that the companies have to forge a viable array of social connections with the encompassing communal system so that they can acquire needed and required resources. The acquired resources get converted into final products and services and the organizations offer them to the society. The quality and value of the products solely determine the ability of the companies to have resources for the next business run (Weerawardena & Mort, 2006). The companies have to operate in order to produce relevant products that can help the target audience in terms of fulfilling their needs and wants. Additionally, entrepreneurship cannot work effectively without remaining committed to the needs of the customers. The culture is the force that storms over every concern of the society. The collective cultures value needs of the many over those of the few so the companies have to entrepreneur in such a way that they can assist the general public regarding betterment of living standards, and the individualistic societies are using completely different approach than the abovementioned one (Spear, 2006). There is always room present for bringing innovations and inventions in the market because workforce over there is creative, and they have adequate level of technology at their disposal that they can apply as a means of accomplishing their ambitions (Akhter, 2007). Furthermore, the strategic management values the creativity of employees, and therefore, the entrepreneurial characteristics remain prominent in the organizational setup of the developed nations. The developing nations bring betterment at operational level, and often they import products from developed ones, and develop the model of franchising in order to earn their due share with each deal so the true entrepreneurship that involves innovation and invention is resident of developed nations of America and Europe (Ali, 2010). The literacy rates in developing parts of the world is not remarkable in nature, and because of this reason, professionals are not proficient with reference to their creative powers. The innovation is the defining attribute of entrepreneurships, but the human resources are the sources of bringing newness at organizational and product level as well. According to Steve Jobs, Apple’s human capital is the true competitive advantage because they are real innovators. The paper will discuss social, rural, lifestyle, and family entrepreneurs. The entrepreneurs have different psychological and social needs that they fulfill by engaging in business activities. The social ones work in order to attain their self-actualization goals in the light of Maslow’s hierarchy of needs because they struggle in order to become better humans through engaging in corporate social services. The rural ones do not have sophisticated professional development under their belt, and therefore, they engage in agriculture so that they can fulfill their basic needs of living. The lifestyle ones have inborn leadership skills that induce them to practice their buried skill in practicalized sense. The family entrepreneurs engage in business because they have to protect an organization from extinction that was created by their family-members who either died or became incapacitated for some reason. They operate under the socialization needs determined by Maslow’s theoretical work. Entrepreneurs have to engage in business activities because they have some kinds of psychological needs and wants that remained unfulfilled for far too long. The social setups of the world do not respect those who do not respect themselves, and the person has to operate and work in order to prove their worth in front of the societies. The entrepreneurs start new businesses and corporations in order to meet and serve their specific needs, but they have the fortune to earn many other fruits as well. The financial strength is going to help oneself in reaping political and socialistic strength with the passage of time as well. The human psychology dictates that people are power hungry creatures, and therefore, the businessmen gather political power in the surrounding social system in the long term perspective. The era of The Great Depression was the ultimate fiscal and economic disaster the current developed world had seen in the recent history. The historians rate the featured period as equivalent to World War II in terms social and economic consequences that the slump caused in those days. The companies were laying off employees in thousands, and the remaining ones had to live under constant threats of budget cuts and pay reduction. The people in America were living in consistent sense of insecurity, and therefore, they had to move in a fearful way in the roads as well. The crime rates were growing and people of lower social cradle had to kill for even the modest amounts of money and food. The slow and ongoing corruption of bodies and souls was evident in the streets, riches were getting rich, and the poor were devolving in financial terms. The companies were firing employees because they had to retain suitable amount of bottom-lines in order to keep continuing with their operations (Westhead, 1999). However, soon they ran out of employees who they require in order to perform various jobs in the organizations, and the companies had to shut down because the cost structures were compromised. The ventures did not remain profitable anymore, and therefore, the economic activity was dying out. The economic experts did not have the answers that they had to answer at that time. The economic expertise failed, but theological ones succeeded in this regard because they educated churchgoers about the importance and value of faith with reference to its ability in cancelling all fears whatsoever. The ratio of believers grew tremendously during the featured economic crisis so church developed a significant level of political power in the society. The counselors guided people to get out of their-selves, and the sense of social service became a stronger attribute in the country as well. The traditional economic theory did not serve the community well enough. The creation of wealth’s island in the country caused social agony in the poor, and the free economy caused the people to suffer beyond recognition. The costs of healthcare started to spike. Types of Entrepreneurs Following are the most common types of entrepreneurs known to the world of business: - Social Entrepreneurs The social entrepreneurships have to take good care of their employees in order to retain them as well. The entrepreneurs operate to serve humanity at both organizational and societal levels. The corporate entrepreneurship is a soft term that business professionals use in order to refer to application of traditional capitalistic techniques on new business concepts and ventures. However, the basic model of entrepreneurship operates in order to provide social services and does not value profitability that much (Hemingway, 2005). The Great Depression helped the businesses to incorporate social values and religious ones in the practices of business. The framework of Judaism, Christianity, and Islam impressed the corporate ventures in the respective geographical locations where each of the theology prevails significantly. The Judaism gave way to greed in the business, and Jews promoted the concept of capitalism during First Industrial Revolution, but after the peril of The Great Depression, the whole world to reconsider the assumptions and presumptions of capitalistic mindset. The theory of Resource Dependence emerged, and the experts argued that social service is going to become a defining characteristic of modern business practices in the near future, and that prediction proved itself as the reality of current times. The notion of Corporate Social Responsibility is a practicalized version of what resource dependence theory professed in the first place. The human relations are based on the important rule of social exchange that requires the individuals to exchange favors in order to keep their connections solid in the society (Korosec & Berman, 2006). The companies obtain raw resources from the societies, and then, process them in order to convert them into finished goods. The products sell, if they are able to provide value to the customers, and if they cannot do that then, the organizational profitability will decline, and sooner or later the malfunctioning companies have to abandon operations because they do not have sufficient resources to obtain wherewithal for the next business cycle. The Great Depression occurred because the companies of that time did not innovate, and therefore, they cannot satisfy the customers. The demand of existing products and services dropped and unemployment kicked in at the end. The entrepreneurial spirit came and saved the world by innovating and finding cheaper ways of producing demanded products and services. The social entrepreneurs do not engage in order to generate financial returns only, but they have the purpose of causing social development in the surrounding society as well. They offer the their employees with attractive packages in order to retain them in the long run perspective, and the entrepreneurs of the featured kind always give more to the society than that of they have taken from the encompassing social system (Auger, et al., 2003). The Great legend, Peter Drucker states that true entrepreneurs never rest, and they have the fondness to cause further development in terms of business and economic activity. The social ones however, are the noblest kind of the entrepreneurs because they work with the vision to help those in need, and they hire people readily, and train them on the job so that they can assist their families in terms of surviving the indignities of the recessed world of economics. The social entrepreneurs are business developers who are accustomed to working in the collective cultures such as China and India where poverty is recorded to be at levels that are off the charts. The entrepreneurs of socialistic nature work in order to prove that corporate practices of normal and natural statures are unethical, and businesses can do a lot more than the achievement and attainment of fiscal goals and objectives. The theory of Social Exchange describes a lot about the psychological nature of the entrepreneurs that engage in order to integrate social work in the framework of business (Baron, 2007). The business professionals have the mental need to prove themselves as better human beings than the others, and the theory of Maslow argues that humans at the later stage of their lives perform noble tasks and help others in the process of development so that they can achieve their self-actualization goals. The social entrepreneurs assist others in the process of personal and professional development, but in reality, they are helping themselves in the conquest of self-enlargement (Korosec & Berman, 2006). In psychological terms, the entrepreneurs have their honor of ending up in the class of humanity’s lovers (Hemingway, 2005). The modern theory of mental sciences urge that people need to spend time with those who they claim to love, and secondly, they have to make a conscious effort and choice of engaging their energies in order to help others develop into better human beings (Seelos & Mair, 2005). Family Entrepreneurs The leaders are of various types, but the relevant ones to this study are situational ones because family entrepreneurs come into the limelight of corporate world due to contextual circumstances, and therefore, they have to develop leadership skills, and economic sense along the way. Often, these kinds of corporate leaders do not have sufficient wins in their lives before; they had to face challenging set of affairs that require the target person to develop in terms of leadership skills so that he or she can manage the company that has familial nature (Chen, et al., 2012). Additionally, entrepreneurs of the featured nature do not own businesses, but their families own them, and they have to take up managerial roles after their relative who was running the business dies or becomes incapacitated due to some medical reasons. Furthermore, family entrepreneurs work through people who they trust, and they balance the corporate ship. The entrepreneurs who manage family corporations always remain focused at operational level of the issues, and they plan very delicately in order to avoid mistakes because they have sentimental feelings towards the companies that they manage and run. They experience fear of losing what they have, and do not take extraordinary risks because they do not have the hearts and courage to risk what has been created by their elders by working with sheer commitment in the past. The theory of self-interest argue that humans protect what they love, and have strong emotions of affection towards an entity to that they are attached at an emotional level. The founders such as Steve Jobs have taken their companies to the heights of effectiveness because they loved their companies (Henry, 2010). The persons become attached to their professions, they face the challenges with bravery, and they do not quit their jobs in hard times. The family entrepreneurs have to keep themselves committed to the unstoppable growth of their companies because they cannot let them die as they hold too much psychological value for the leaders of abovementioned kind. The ecological and emotional factors of the underlying family system pushes the heirs of business professionals into the economic arena in order to save the organization that was orphaned due to death or severe medical condition of the owner. The soul of economy found life once again when the businesses innovated on their own, and the theory of Adam Smith backed up those innovative ventures, and gave a new prospective to the nation to work with. Deep down all those economic terminologies and references, the religious values of Christianity impressed the public to share what they have in order to help others to make it through the rough times. The sense of sharing caused inactive funds to disseminate into the society, and the lower social circles were partially benefited from the newest approach. However, it was enough to catch the attention of the economic guru of that time whom quickly suggested that businesses have to become socially concerned entities in the future so that the possibility of depression can be minimized in the upcoming times. The prevalent governmental systems have to keep a close eye on the economic trends of the countries, and they start to take corrective measures at the first sign of trouble. Additionally, the depression has to occur because it takes place due to natural order of the events. The economic inefficiencies cause the businesses to overproduce and they face losses due to their poor and emotional economic and strategic choices. The government has to be active in order to maximize the time of boom and minimize the period of depression as well. The governments have to fight monopolistic elements in the national systems as well so that competition remains constant, and the businesses must innovate in order to offer customers with undying value at all times. The element of competitive forces pushes the businesses to offer new products and services to keep the customers interested in their offerings. The companies grew a new department with the title of Research and Development that works with the vision and purpose of developing new products that can satisfy the customers in more adequate manner. The innovative forces and entrepreneurial spirit is powerfully present in the setup of regular organizations because they have to develop new products in order to remain above the competitors. The companies are requiring creative and innovative employees so that they can innovate on a regular basis. The organizations are trying to retain workers by offering them monetary and nonmonetary benefits as well. The human capital will make all the difference that any company needs to survive and thrive in the market as well. The organizations are integrating the notion of teamwork in their setups because they are well aware of the fact that the whole is greater than sum of its parts, and the sense of synergy is developing as the concrete partiality of the organizations in the modern day. All the factors that were previously mentioned help the economies fight the situation of depression. In addition, the strategic leadership of the companies put a vital hand with reference to applying entrepreneurial principles in the organizations. The role of top management represents a pivotal dynamic of the game because the leaders have to provide the commercial entities with the vision, and if they are not interested in trying new products, and technologies then, the companies operating under them are destined to be doomed (Peredo & Mclean, 2006). The developed world has reached to the moon and they are attempting to send a manned mission to the mars as well because of one attribute that is the will to invent and innovate. The research to grow alternative energy sources is clear as a day, and the scientists are engaged to make human life easy in the future when oil reserves of the globe will run out. The vision to have a benefit in the future that next generation can apply in order to support the process of betterment in their lives in the true spirit of entrepreneurship. God has created two forces and they take different forms in various areas of our lives. In social setups, education represents the evolutionary force whereas, in business, entrepreneurship works for the same purpose. Lifestyle Entrepreneurship The people who do not like to follow others, and they have the confidence to try new ventures. They love to play the game of economics and they are addicted to that as well. They are born leaders and risk-takers. They have problem with people who need and want to guide them. They have a hunger for power as well. They hate to follow, but they love to lead. They have a significant self-image and they believe in the value of human effort in the process of making things possible (Akhter, 2007). The leaders who develop their personalities to perform their jobs never give up on the concept of constant and innovative growth at all times, and they do not believe in stopping. Unlike the survivalist, the born leaders develop teams and keep expanding their corporate dealings. The companies that operate under intuitive leaders continue to innovate as Apple was doing in the stature of Steve Jobs. The born leaders are driven, and they never prevent the process of betterment in the company. The born leaders believe in teamwork, and they follow democratic method of governance, but survivalists follow the autocratic regime in this regard. The natural leaders support constant growth in human capital of the organization. The leaders of material type will always inspire greatness in others. The leaders have the need to remain powerful at all times, and they keep their positions by delegating responsibilities to others. They work through people, and often these types of entrepreneurs operate in technological industry where constant invention and innovation is the need of the hour. The leaders recognize the value of humanistic growth (Auger, et al., 2003), and they play the role of facilitators so that people continue to grow while working in the organizations. The leaders will use reward system to retain the employees as well. They will not let anyone leave the job without making an effort to prevent the turnover. Entrepreneurship is a sophisticated name of successful application of projects that other businesses have deemed impossible. The founder of FedEx made a difference in the courier package delivery industry, and he was dissatisfied customer who was irritated by lateness of deliveries by US mail. He commenced the company in order to prove that timely delivery is very much possible, if the organizations perform time management properly, and now his company is leading the show in the world of courier services. Innovation occurs at two levels of the organization, and both create different and unique degree of financial and economic success in the market. The first level is organizational one where companies bring operational changes in their setup so that their level of efficiency can be enhanced. The cost of production and delivery drops as a result of successful application of abovementioned action plan. The companies that use first type of change follow a limited strategic regime, and they keep on doing same or similar sorts of operations (Seelos & Mair, 2005). The companies that opt to have second order change make strategic changes and introduce the culture of change in their setup so that the employees cannot relax for even a moment. The innovation is the driving force that keeps these organizations moving forward. They bring operational and strategic makeovers in order to achieve their goals and objectives. Their leaders never give up and provide the employees with the energy to do the same (Spear, 2006). They experience pain and emotional trauma, but they have the will and courage to try again and again until they get what they want and need to have. For these folks, the addiction of economic game is immense in nature, and they love to prove others wrong by pulling the apparent impossibility off. The childhood has the secret that develop these kinds of personalities who can nail the world. They are socially perceived failures, and they had to face bullying at school. Some of the leaders are by birth, and they have a hard time finding deeper meaning of their lives. The featured type of entrepreneur does not enjoy working under the tighter organizational regime (Westhead, 1999), and therefore, they get irritated at a psychological and emotional level, if they have to take orders from others. Additionally, the theory of self-efficacy establishes that leaders have strong self-image, and they have sensitive egos as well. They had to experience emotional trauma, if their efforts are not recognized and rewarded accordingly. They develop an urge to prove their worth to the world, and therefore, they craft and create their own organizational setups (Macko & Tyszka, 2009). They cannot follow, but they can definitively lead others, according to Peter Drucker. In most of the cases, the leaders have to lose their jobs, and life dares them to do better (Peredo & Mclean, 2006). The professionals mock them about their unproven skill set that they have to apply in order to emerge as successful professionals and leaders. The lifestyle entrepreneurs always have an intention to prove their strength to the world. However, according to Andy Kessler, they are free electrons that are so vibrant in nature that they always want to do something (Kessler, 2012). They are committed to action because they cannot let the world call them failure once again. The lifestyle entrepreneurs have the dream of constantly growing because if they do not do so then they develop anxiety and fear of becoming obsolete with the passage of time. The Maslow’s hierarchy of needs says that people have two sorts of developmental requirements. The social entrepreneurs work to gain political and social power in the community by serving the humanity while, lifestyle ones have to develop a centralized organizational system in order to authoritatively rule others so that they can shame their competitors by demonstration their strength. Rural Entrepreneurs The rural entrepreneurs are the business professionals who do create a basic and natural levels of the organization because they do not have sufficient professional development under their belts to create sophisticated form of the company (McElwee, et al., 2011). They work in the industry of agricultural products and services. The developed nations have overly protected their agricultural sectors from international competition, and therefore, the engaged souls in the field have enough earning potential that they do not have switch professions in order to find better paying jobs. The Maslow’s theoretical contribution argues that rural entrepreneurs find new technologies and sales channels in order to increase the efficiency and marketability of their products respectively. However, their fundamental goal is to fulfill their necessity of life. Conclusion This paper has an objective of discussing different types of entrepreneurships that the world has seen in recent years. The defining attribute of any new venture is to bring operational and strategic changes that defy normal and prevalent practices in the specific industry. The entrepreneurs have to be leaders in order to perform their roles that either come to them naturally or they have to do them because of situational factors in their lives. Natural or not, entrepreneurs are courageous people whom have to prove to the world that they have more worth than what meets the apparent eye. Humans have the natural gift to learn and adapts to new situations that differentiate them from all other creatures of God. 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