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Entrepreneurial Development, The New Paradigm!

Entrepreneurial Development, The New Paradigm!
by

Zack Dafaallah

on 29 March 2013

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Transcript of Entrepreneurial Development, The New Paradigm!

Paradigm! 85% of Millionaires started their own businesses.

40% of the top 1% started their own businesses.

95% of US Wealth is created since 1980 by entrepreneurs. Small Business Start-up In Policy GEM: created by Babson College/ London Business school K-12 Curriculum approved by US Department of Education In Business NFTE’s out of school program reaches 10,000 youths inner city 1999 Bipartisan NCOE established US Today, CNN, NASDAQ and
Ernst & Young all sponsor nationwide 25 in 1980; 1995 under 500; 2005 over 5,000 Courses in
1,600 Colleges In Education Small Business
FAILURE RATE
remains relatively Entrepreneurship can
boost economic growth and SBA
reports that Globally: (WEF) Competition Poor location Insufficient Capital Lack of experience Low sales Source:
Dr. Michael Ames,
Small Business Management Over-investment
in fixed assets Poor credit arrangements Personal use of
business funds Unexpected Growth Poor inventory
management Lack of Planning Starting for the wrong reasons Overexpansion Poor Management Failure to change with times Inadequate Business Plan Ineffective marketing/
self-promotion Ovespending Source:
www.allbusiness.com Poor execution of
internal controls Poor capital structure .. it's all about Business! Skill/idea The Cycle of an
Entrepreneurial
Business so, it really boils down to the individual Entrepreneur whose underlying GOAL is
STARTING and SUCCESSFULLY
running a BUSINESS? The Entrepreneur we focus on So, how do we develop well, for one “Entrepreneurs Create Value and
Realize that Value through the
Creation of Equity
through Ownership.” according to Timmons & Spenilli Developing
the Entrepreneur Entrepreneurship involves a set of skills that is
the result of cultivation and development rather than
innate endowment! Entrepreneurship Training “.. is the building of knowledge
and skills either “about” or “for
the purpose of
ENTREPRENEURSHIP” Evolved in IHE
Academic-Degree Orientation
Knowledge vs Experience
Intended Audience dictates
content and pedagogy
Experiential Dimension
(Faculty-Student)
6-10 year delay in initiating activity HOWEVER, the Kaufman Foundation,
also, finds that Entrepreneurship Education has NO appreciable IMPACT on SMALL BUSINESS Start-up rate! Entrepreneurship Education “.. is the building of knowledge
and skills in preparation of
STARTING a BUSINESS” According to GEM Ultimately, the underlying GOAL and FOCUS
of Entrepreneurship
Education is NOT to start
New Small Businesses! whereas Entrepreneurship Education Pre-structured learning content
Banking vs Problem Posing
Reflective Theoretical vs Practical Applied
Exacting only “simulated” applied work
New Venture Creation is “context” not “goal” which means, the Business
is THERE for the long haul! and, according to the
US Small Business
Administration: a Little Motivation! Individual level-
Entrepreneurs: Entrepreneurship is
a learned competency Entrepreneurs
are not “born”,
they “become” Anyone can be an
Entrepreneur at any
time of one’s life Entrepreneurs
are found in every occupation and career Net Gain: 78,377 Closed: 565,745 2005 Bankruptcies: 39,210 Started: 644,122 well, let's recognize
some MAJOR
differences between Novelty
Involve Key Others
Growth as Goal
Wealth
Profitability and growth
Innovative strategic practices
Fund with other people’s money
Profit as key
Cash crunch? See More Source:
Attard Communications, Inc. Source:
Gustav Berle,
The Do It Yourself Business Book so, why is
Entrepreneurship Training,
NOT helping boost success rate of small business,
you ask! Greene & Brown's Entrepreneur
Resource-Opportunity
Model The
Entrepreneurial
Development From The National Content Standards for Entrepreneurship Education
Courtsey of
The Consortium for Entrepreneurship Education
Columbus, Ohio
www.entre-ed.org Prerequisites for
participating in any
"Entrepreneurial Development"
program Digital Skills
Productivity Applications
Internet Proficiency Word Processing

Spreadsheet

Presentation Emailing

Web Browsing

Web Communication Principles of
Entrepreneurial: Accounting
Marketing
Finance
Operations Discovery
Idea Cultivation
Concept Development
Actualization
Harvesting
Growth Management
Leadership Development Economics
Business Law
Communications
Human Resource Entrepreneurial and Directive Skills Development Stage Tangibles:
Products
Non-Tangibles
Service
Experience Business “EXCHANGE” of “THINGS” for “PROFIT” HOWEVER,
Entrepreneurship is NOT
learned by reading a textbook and then taking a test to prove you are an ENTREPRENEUR! 3.0 Entrepreneurship and
Small Business Ownership but why do they fail? ... in other words,
if Small Business is the engine of
our Economy, Entrepreneurship is
the engine of Small Business! US Senate Commission on SB and Entrepreneurship 1994 UNGA Resolution: Entrepreneurship as a Policy so, what are we missing? (Borjas, 2000; Parker 2004) BUSINESS SKILLS “Nascent Entrepreneurial Success still, research shows that: is often a function of in general, and relevant in particular” ENTREPRENEURIAL TRAINING Essentials First, 1.0 Collective level-
Small Businesses: Represent 99.7 of all employer firms.

Have generated 64% of new jobs over the past 15 years.

Are 52% home-based and 2% franchises.

Numbered 29.6 million with 21.7 without employees. 2006 Closed: 599,333e Started: 670,058 Net Gain: 70,725 Bankruptcies: 19,695 Closed: 571,300e Bankruptcies: 28,322 Net Gain: 91,800 Started: 633,100 2007 of the Year Awards Entrepreneur Most Do Fail ! Small Businesses 2.0 the question is:
What needs to be done to make
Small Business more Sucessful? Productive skills Managerial skills Directive skills Small Business Owner Entrepreneur Entrepreneurial Venture Conventional Small Business Furthering personal goals.
Primary source of income
Majority of resources.
Business as an extension
personality
Bound with family needs Imitation
Autonomy
Control as goal
Financial Independence
Independently owned/ operated
Not dominant in field
No innovative practices
Fund with Your Own money
Cash Flow as Key
Cash Crunch? Tighten Belt Profit and growth.
Innovative behavior
Employ strategic management also, for our purpose,
here's our definition of Entrepreneurship: Starting a Business! The Knowledge, Skills, Ability, and Willingness to
Exploit and Integrate various Resources to
Innovate and Create Value, i.e. Entrepreneurship: Critical
to Economic Growth? 4.0 According to the Kaufman Foundation, On average, one-year-old businesses create nearly one million new jobs a year, while ten-year-old firms generate just 300,000. Small Business is the engine of our economy;
Entrepreneurship is the engine of Small Business;
Entrepreneurship Education is spreading at extremely high rate, YET
Small Business START-UP rate remains low, and its FAILURE rate remains high! 5.0 so, what are we still missing? Entrepreneurship:
Education vs. Training! well, first let's take a look at
some NEW CONCEPTS and
MAJOR differences, beginning with Academic Orientation Business Creation Orientation Long term process
Extremely intangible
No continuity with existing offerings
Innovation vs Structural Rigidity
Lack of a comprehensive scientific
approach
Content specialists
acting as training-entrepreneurs
Shortage of formally-trained
entrepreneurs as trainers Entrepreneurship Training We have defined two types of specialists:

(CSA) Content Specialist Academic is a person, with a Masters Degree or PhD, who is currently a faculty in an IHE lecturing in the specific field of business education, i.e. Accounting, Finance, Marketing, Management, Operations, etc.

(CSP) Content Specialist Practitioner is a person, with a Bachelors or Masters Degree or PhD, who is currently working in the specific field of business, i.e. a CPA, a Banker/Finance Specialist, Marketing Specialist, Deaprtment Manager, Operations Manager, etc. 6.0 Connecting the Dots! Developing the ENTREPRENEUR 7.0 The Goal “The Purpose of
a Business is to
Create and Keep
a Customer” Quoting Peter Drucker; The Cycle The Anatomy Research Create Value Legalize Cash in Manage Grow Market Get out Give back According to Michael Gerber; although, it's all about Business,
there's no START-UPS without
ENTREPRENEURS! Directive skills Productive skills Managerial skills Human Capital Financial Capital Social Capital Ready Skills Business Skills Entrepreneurial Skills 8.0 LabFrog Ventures Source:
Katz & Green
2006 Source:
Carland et al
1984 Vertically Integrated
Horizontally Integrated
Hybrid Non-Employer Business
Employer Business UNCHANGED let's recap here for a second, Opportunity Entrepreneurship
Necessity Entrepreneurship START
with 100 new
businesses at any
point in time 2-Year Mark
34% will fail 66% will still
be operating 44% will still
be operating 4-Year Mark:
Total of 56% will now be closed Total of 90% will
be closed 10-Year Mark
only 10%
will still be operating Entrepreneurs identify market opportunities or needs, imagine and develop innovative solutions that address those needs, and build organizations to capture those market opportunities Lichtenstein and Lyons because The Entrepreneurial Development Program by Introducing ™ Entrepreneurs
vs.
Small Business Owners for our purpose,
here's our definition of The
Enterprise NESBAcademy.org Providing Learning Essential to Business Success
Full transcript