This page deals with economics and business issues,concerning Latin America, and the global economy.-
Friday, August 31, 2012
The nature of entrepreneurship (I)
One characteristic of Global economy is (believe it or not), the wide variety of new opportunities available for entrepreneurs. Let check some examples out: Do you want a birthday card to someone in Europe , USA or Buenos Aires?.What about a book?.Flowers? These days, it is possible to be in touch more often with those we care about , because new means are available . Small businesses have gone further their local markets, taking advantage of connectivity options arising from internet , social networks, smart phones and the likes to establish market positions as it was not possible to think of , a few years ago. (4,6 billion people have access to mobile phone). There is a story of a Mercedes car driver, who has a problem with the engine somewhere in Europe , and it get the problem solved in less than 24 hours ,even though it is more than 800 kilometers away from the main Mercedes supplier How come? Well, a combination of logistics, technology (GPS, and supplier networks),and small business , ready to do the complementary job dealing with the solution. Small business(labor intensive), are the perfect complement for big business , usually capital intensive. The UK government has recently released figures ,showing that the number of graduates leaving university on a self-employment route has soared by 46 per cent over the last six years.(www.yourhiddenpotential.co.uk) .-
Thus, technology and global markets, have allowed to generate new opportunities for entrepreneurs which to take advantage on. Because of the scale volume, and low operational cost (some cases it is needed few laptops, and above all an agile mind), entry cost in global markets, are lower for small business and entrepreneurs.60% of new business in the global markets, are related to entrepreneurs and small business, because of their abilities to move resources from one low productivity use, to another higher productivity alternative, faster than big companies do. But, not all entrepreneurs know these opportunities, neither not all opportunities are captured by entrepreneurs .
Entrepreneurship and business opportunities are a matching process, which depend on transaction cost , economic policies ,and entrepreneurs abilities and competences .However, because of its nature (related to individual ), when it comes to support entrepreneurship activity, it begins with economic growth based policies, flexible regulations ,clear and stable rules ,flexible markets ,which add up to set a framework of strong incentives, for new business. Therefore ,too much government intervention , mean fewer opportunities for entrepreneurs.
On the other side ,how come that the business opportunity and the entrepreneur match one another?. Is it a matter of entrepreneur “opportunity taker” abilities ?, or is it a more complex process which includes self stem , network quality, and market knowledge, which allow entrepreneur to be an “opportunity creator” as well?. It follows that it might come down to the entrepreneur ability to create their own opportunity given a framework of incentives. The later , is The Babson College approach, which support the idea of entrepreneur as the “opportunity creator” instead of being just an “opportunity taker”. In fact, the latest GEM report (2011), shows that the perception of new business opportunities, decrease the fear of failure, which induce entrepreneur to go on to create its own opportunity .-