Entrepreneurship and Small Business Management

This assignment involves a comprehensive analysis of entrepreneurship research, small business management, and economic development. It includes various sources such as academic papers, online articles, and statistical data to provide insights into the impact of micro and small businesses on local economies. The assignment also discusses the importance of innovation types and performance reviews in growing UK SMEs.

ENTREPRENEURSHIP
AND SMALL
BUSINESS
MANAGEMENT

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Define different kinds of entrepreneurial ventures and their relation with typology of
entrepreneurship..........................................................................................................................1
P2 Similarities and differences between different entrepreneurial ventures...............................2
TASK 2............................................................................................................................................3
P3 interpret and Assess relevant data & statistics to defined the impact of micro and small
business on economy...................................................................................................................3
P4 Importance of small businesses and business start-up to growth of social economy............5
TASK 3............................................................................................................................................6
P5 Characteristics, skills and traits of successful entrepreneurs and their differentiation form
managers.....................................................................................................................................6
P6 Evaluate how aspects of entrepreneurial personality reflect entrepreneurial mindset and
motivation ..................................................................................................................................8
TASK 4............................................................................................................................................9
P6 Relevant examples to show how background and experience can hinder or foster
entrepreneurship..........................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Entrepreneurship is defined as a procedure of establishing a new business, running and
managing it in order to attain long term growth and high profitability. Under this aspect, a firm
combines capital, labour, land so that high revenue can be generated. Entrepreneurs are those
individuals which start-up these new businesses (Barringer, 2015). These individuals have ability
and urge to convert their ideas and concepts into reality by executing business operations. This
assignment is going to cover various kinds of entrepreneurial ventures along with typology of
entrepreneurship by discussing their similarities and differences. Also, impact of small and micro
businesses on economy of a country is discussed. Different characteristics of entrepreneur, their
background and experiences are discussed to understand which factors foster and hinder growth
of an individual.
TASK 1
Define different kinds of entrepreneurial ventures and their relation with typology of
entrepreneurship
There are different kind of entrepreneurial ventures that differentiate a business form
another. In this regard,
Types of Entrepreneurial Venture Small Business Entrepreneurship: These are those people which run their own
businesses. Main aim of these entrepreneur is to earn high profitability so that
standardised living can be lived without facing any complexity. It includes grocery store,
travel agent, consultant etc. Large Business Entrepreneurship: Entrepreneurs which follow diversification strategy
come under this strategy. These people believe in innovation in accordance with the
needs and demands of customers. These are risk taking people which achieves high
revenues and profitability.
 Scalable Start-up Entrepreneurship: To start business, they attract the attention of
venture capitalist. In contrary, these venture capitalist only funds them if they get
satisfied with their business plan. They earn high revenue and growth without paying
additional on social sites and online media (Bhachu, 2017).
1

 Social Entrepreneurship: It involve innovators who works for social welfare, they don't
have any greed of earning huge revenues or building market share. For making it possible
they solve the social need/problem of people and bring positive changes to the society.
Typology of entrepreneurship: In these regard, there are four kind of entrepreneur which
are mentioned below: Young Innovators: These involve those entrepreneur which are small, young and have
strong desire to attain success at early age. Revitalised Tycoon: They are those middle age entrepreneurs which have already gained
experienced while working in other businesses. However, with passage of time these
person gain high confidence and ready to attain their own business. Natural Entrepreneur: These are the matured entrepreneurs which has good years of
experience. In addition to this, they have personality trait and characteristics of being a
successful entrepreneur. They remain highly motivated and believe external factor are
their barrier.
 Time-Honoured Traditionalist: These are old age entrepreneurs which have reached the
age of 60. Their knowledge, confidence and business experience motivates them to
became an entrepreneur.
Similarities and differences between different entrepreneurial ventures
Basis Small business Scalable start up Large company Social
entrepreneurship
Definition These are small-
sized business
that requires less
investment
because of
operating at small
scale.
It is those
businesses which
operates to attain
its vision due to
suitable planning.
These businesses
have finite cycle
that mainly focus
on developing
new products and
services as per
changing needs.
These are the
innovators that
comes into
market along with
new idea to cater
the needs of
society,
2

Characteristics They requires less
resources to
operate business
and without
getting interfered
by government.
It focus on
making more
venture capital
that business can
reach large scale
in less time
period
It is an ongoing
process which
changes in
accordance to
fluctuations of
customer demand
Adequate support
and help from
government is
given due to
which running
business became
easy
Objectives To earn a happy
livelihood.
To invite
investors so that
financial help can
be acquired in the
form of
investment
(Carsrud and
Brännback,
2011)
Its major
objective is to
fulfil the needs of
customers by
using advanced
technology
It has main
objective to
maximise the
interest and
satisfaction level
of society through
providing them
social welfare
products and
services.
TASK 2
Interpret and Assess relevant data & statistics to define the impact of micro and small business
on economy
Small and micro business companies have a big contribution to the economic
development and helps in enhancing national income of country. These firms execute their
business in marketplace and helps in stabilising national income, deflation, fluctuation etc.
organisations which are managing business on small level can make economy stronger.
Economic fluctuations highly impacts business organisations. This small and micro business
manages their businesses with innovative ideas, less resource as it helps in growing economy in a
faster way.
These organisation face lack of funds but good knowledge and skills helps them to
manage business in a successful manner. Due to effective working, it does not harm their
profitability. Large organisations prefer to overtake small firms due to which they get
3

overshadowed. They lack profit growth in comparison to large organisations but have more
stability due to which economic instability do not hinder their growth. Major impact of these
micro and small businesses are mentioned below:
 Generation of employment: In order to manage these small businesses, skilled and
capable workforce is required. Due to this, employment opportunities increases and UK
doesn't face issues like unemployment. High employment rate will benefits the economy
to grow at a faster rate with the help of reducing unemployment (Dees, 2017).
 High cash flow: They will benefits in enhancing cash flow as when a new business
initiates it will helps in increment of monetary value for the nation.
 Infrastructure development: Due to payment of taxes and other custom duties, these
businesses will contribute in enhancing national income. This income can be used for the
purpose of building road, hospital etc.
4

This chart depicts that, all small and micro businesses have enhances employment rate for
the country. It is highly beneficial for economic growth and helps in achieving high
development. They contribute in 40% of employment enhancement that has a positive impact on
business organisations (ME Performance Review).
These small and medium businesses contributes 48% and 12% respectively in providing
employment opportunities in UK. Turnover rates in these small businesses is 33% whereas
turnover rate in medium businesses is 14%. In UK, 0.1% businesses are operating large scale
organisation whereas 99.3% businesses are related with small businesses. Remaining
organisations are concerned with medium businesses.
 At present, there are around 5.6 million small and medium businesses in UK.
 Small businesses accounts for 99.3% whereas medium businesses accounts for 0.7%
only.
 Combined turnover of SMEs is around 2 trillion pounds which is about 52% of entire
private sector turnover (UK Small Business Statistics).
Importance of small businesses and business start-up to growth of social economy
Social economy is formulated when different companies forms associations and mutuals.
Start-up business possess a great benefit to the growth of social economy in UK. It is vital for the
5

government in UK to support these micro and small businesses so that people in UK can act
independently and live a healthy living standard. There are different issues that are faced by
people after Brexit. It has impacted the working and revenues of large organisations in a negative
manner. But small businesses were less impacted due to Brexit and helps UK in stabilising their
economy. Importance of start-ups and small businesses in social economy is defined below:
 Providing end number of job opportunities: Small business and start-ups will helps in
generating employment opportunities as they will require workforce to perform business
activities. Start-ups are new businesses that required skills staff to attain sustainability. In
this regard, they will benefits in developing social economy by enhancing national
income (Djankov and et. al., 2010).
 Increment in domestic business culture: As UK economy has faced different issues due
to Brexit, large organisations get severely impacted and their profitability have reduced.
In this regard, small companies have offer products to customers which are needed by
them in affordable prices. Due to this, these small business have paid taxes and other
duties that benefits in social growth in form of infrastructural development.
 Encouraging new and innovative products: Start up are initiated with the purpose of
launching new ideas and innovation. People in UK will get attracted towards the products
that will satisfy their desire in a more satisfactory manner. It will results in increment of
social economy as revenues and profit of organisations will enhance (Importance and
benefits of small business).
TASK 3
Characteristics, skills and traits of successful entrepreneurs and their differentiation form
managers
Every entrepreneur is required to posses efficient characteristics and traits. In this regard,
Peter Jones and Alan Sugar are two successful entrepreneurs that successfully represent
themselves in UK and around globe.
Peter Jones
Peter Jones is a UK based renowned and successful entrepreneur that has successfully
represented itself in retail, media, television etc. Jones is popular for programs like Tycoon,
Dragon den, American investor etc.
6

Characteristics: Some characteristics that are possessed by Jones are mentioned below:
 Self-motivation: Peter has able to motivate himself in difficult and challenging situations
due to which complex situations will be sorted out in an appropriate manner. To avoid
demotivation, Peter use to read magazines and books to learn about business concepts in
detailed manner.
 Take risks: Peter was capable to bear risks associated with business that benefits him in
attaining high profit and success.
Traits:
 Perform business operations for high purpose: Jones has brought up a revolution in
mobile phone sector. Due to which he attains his purposes and became a successful
entrepreneur in UK.
 Believe in product and team: Performing business operation without the support of
team is not possible. Jones was good in managing team that helps him in reaching
success.
Skills:
 Time management: Peter is passionate about organisational goals and objectives. This
motivate him to perform business activities in a timely manner.
 Sense of control: Jones has ability to control situation in accordance with desirability.
This helps him to be a renowned entrepreneur (George and Bock, 2011).
Alan Sugar
Sugar is a renowned business entrepreneur. In business world, Alan has achieved high
success as a producer and actor. After starting a company named AMSTRAD, Sugar achieve
success and became a millionaire.
Characteristics:
 Confidence: Alan has confidence about his capabilities to run and manage business by
beating risks. He is confident about his talent while performing business activities.
 Creativity: This helps him to adopt innovative concepts in business activities.
Traits:
 Flexibility: Sugar adopts flexible working approach to perform business activities due
which carrying out changes in accordance with requirement is easy for him.
7

 Vision: Sugar set up a vision to be a market leader. By hard-work, he has attained desired
success.
Skills:
 Esteem: High self esteem helps Sugar to achieve desired organisational goals. This
results in attainment of success. Communication: Sugar possess good communication skills that helps him to interact
with its employees in an appropriate manner. Due to this, organisational work is carried
out in a productive manner (Five skills every entrepreneur should have).
Differentiation of characteristics of successful entrepreneurs with business manager:
Characteristics/skills Entrepreneur Business managers
Strategic vision They have a clear vision to
introduce new and innovative
products in marketplace.
They follow vision which is
formulated by the management
within an organisation.
Communication An entrepreneur must possess
effective communication skills
that will helps in interacting
with customers in a desired
manner (Goss, 2015).
Effective communication will
benefit manager in
appropriately spreading the
mission and vision of company
to workforce.
Evaluate how aspects of entrepreneurial personality reflect entrepreneurial mindset and
motivation
To achieve desired growth and success, an entrepreneur needs to have some qualities and
capabilities which will differentiate them form ordinary people while performing business
performance. This will assists in gaining competitive advantage in highly competitive market.
Appropriate character, behaviour and qualities helps a person to attain good outcomes.
Personality of an entrepreneur defines its work performing capabilities.
Big five model of personality:
 Openness to experience: It is associated with preference, intellectual curiosity and other
life experience of a person. It helps in stabilising complexity facing capability of an
individual. A successful entrepreneur is required to open himself for various experiences
8

as it will benefits in enhancing their work performing capabilities that leads to success
attainment.
 Conscientiousness: It is related with the ability of a person to be disciplined,
independent and organised. People having low conscientiousness prefers flexible working
approach that can hinder the risk bearing capacity of an entrepreneur. High
conscientiousness helps in enhancing independence and activeness to manage business
properly (Aspects of Entrepreneurial personality).
 Extraversion: This is an essential trait that is required by an individual so that desired
market shares and reputation can be sustained within marketplace. It is vital for
entrepreneurs to be self satisfied and assured. This will benefits them in guiding and
motivating workforce in a proper manner (Light, 2011).
 Agreeableness: This specific trait will assists an entrepreneur to manage its workforce in
a collaborative and unified manner. An entrepreneur is required to be supportive,
impartial and truthful which will enhances appropriate working culture within a firm.
 Neuroticism: It will helps in making a person more focused and versioned. An efficient
entrepreneur must be able to deal with his employees in a systematic manner. To be a
successful entrepreneur, a person is required to learn the ways so that issues like stress,
anxiety will not affect business activities (The Big Five Personality Traits).
Advantage: This model is more approachable and helps in identifying the
communication skills and openness of an individual. Also, this model will benefits in motivating
and guiding workforce properly. Due to this, achieving organisational goals became an easy
process.
Disadvantage: This model is not capable to predict any specific behaviour as human
behaviour is related with different factors and do not reflected by personality only. Also, this
model is considerably limited by universalism. Also, it do not helps in understanding culture
specific, age specific, gender specific personality expressions. Due to which this model is not
able to interpret entrepreneurial mindset on a proper manner.
9

TASK 4
Relevant examples to show how background and experience can hinder or foster
entrepreneurship
Capabilities, traits and skills of an entrepreneur differentiate itself form other individuals
which dreams to earn high revenue so that a standardised level of living can be maintained.
These aspects are related with the education and family background of an individual as it impacts
their work performing capabilities. If family background and education of a person is influential
this will reduces the chance of facing complexities while thriving for success.
Family background: It is a vital aspect for individual's development and career. In case
of entrepreneurship, it plays an important role in defining the risk taking and decision making
capabilities of an individual. Peter Jones is a renowned entrepreneur raised in Berkshire,
England, UK. Financial condition of his family was not well but he was given good education in
a private school. Peter's father manages a small business due to which peter have never enjoyed
luxurious life. In starting, he tried to run different kind of businesses but receives failure in return
because of shortage of fund, lack of interest etc. influential family background helps a person in
providing financial support. As Jones was not form an influential background family, he has
faced some struggle that motivates him to achieve high success. Negative aspect is that he faced
difficulties related with lack of funds, investments etc. during his career days.
Alan Sugar is also a renowned entrepreneur in UK. Sugar is chairperson of Tottenham
Hotspur. He was born in a Jewish family and his father was tailor by profession. Due to lack of
money, sugar faced problem in completing his academic study (Naudé, 2014). Both of these
entrepreneur have capabilities to manage difficulties that helps them in gaining advantage over
other struggling peoples (Peter's Jones biograpgy). Sugar was from a poor family that acts as a
barrier in gaining knowledge and academic studies. It can be stated as a negative impact because
of family background. Positive aspect is that it enhances the stress bearing capability of sugar
due to which he was able to deal with difficult situations in a confident manner.
Experience: Jones is a successful entrepreneur which has gain wide popularity in
different fields like television, media, leisure, phones etc. In teen age, Jones has designed a
computer under his own name and brand. But due to business failure, Jones set up its new
business in the field of mobile phones. After facing struggle and criticism, he brought a company
in 2005 which faced a big failure. After fighting against all odds, Jones was able to achieve
10

success. Failure encourages him to change his work performing approach so that he can attain
desired success. Experience of sugar is also inspiring in his teen age he works as a statistician.
Alan sells radio aerials; cars etc. so to earn a good living standard but did not attain success.
After facing so many up and down, he attained desired success and growth. This benefits him in
learning the way to survive in complex situations. Bad impact was that it results in deprivation
form healthy and happy childhood (Alan sugar: facts and information).
CONCLUSION
From above mentioned report, it has been concluded that there are different types of
entrepreneurial venture according to their size, scale and investment. Different ventures have
some similarities and difference in accordance with the organisational objectives of business
owner. Small and micro business posses an considerable impact on the economy of UK as it
helps in providing job opportunities, enhancing revenues and infrastructure etc. they also assists
in developing social economy as they generate employment opportunities for local people. There
are different characteristics and traits, experience and background of entrepreneurs that reflects
their strong personality
11

REFERENCES
Books and Journals
Barringer, B. R., 2015. Entrepreneurship: Successfully launching new ventures. Pearson
Education India.Psychology Press.
Bhachu, P. ed., 2017. Immigration and entrepreneurship: culture, capital, and ethnic networks.
Routledge.
Carsrud, A. and Brännback, M., 2011. Entrepreneurial motivations: what do we still need to
know?. Journal of Small Business Management. 49(1). pp.9-26.
Dees, J. G., 2017. 1 The Meaning of Social Entrepreneurship. In Case Studies in Social
Entrepreneurship and Sustainability(pp. 34-42). Routledge.
Djankov, S., and et. al., 2010. The effect of corporate taxes on investment and entrepreneurship.
American Economic Journal: Macroeconomics. 2(3). pp.31-64.
George, G. and Bock, A. J., 2011. The business model in practice and its implications for
entrepreneurship research. Entrepreneurship theory and practice. 35(1). pp.83-111.
Goss, D., 2015. Small Business and Society (Routledge Revivals). Routledge.Kelley, D. J.,
Singer, S. and Herrington, M., 2012. Global entrepreneurship monitor 2011 global
report. Global Entrepreneurship Research Association, London Business School.
Light, P. C., 2011. The search for social entrepreneurship. Strategic Direction. 27(6).
Naudé, W., 2014. Entrepreneurship and economic development. International Development.
Ideas, Experiences and Prospects.carborough, N. M., 2016. Essentials of
entrepreneurship and small business management. Pearson.
Online
Aspects of Entrepreneurial personality. 2017. [Online].Available
through:<http://smallbusiness.chron.com/important-small-businesses-local-economies-
5251.html>.
Impact of micro and small business on economy. 2018. [Online]. Available through:
<https://www.ons.gov.uk/economy/nationalaccounts/uksectoraccounts/articles/
economicreview/apr2017>
The Big Five Personality Traits. 2019. [Available
through] :<https://www.verywellmind.com/the-big-five-personality-dimensions-
2795422>
Business statistics of SMEs in UK. 2017. [Online]. Available
through:<https://researchbriefings.files.parliament.uk/documents/SN06152/SN06152.pdf>
Innovation types and performance in growing UK SMEs. 2017. [Online]. Available
through:<https://www.emeraldinsight.com/doi/abs/10.1108/01443570710756974>
UK Small Business Statistics. 2018. [Online]. Available through:<https://www.fsb.org.uk/media-
centre/small-business-statistics>
SME Performance Review. 2018. [Online]. Available
through:<https://ec.europa.eu/growth/smes/business-friendly-environment/performance-
review_es>. SME Profit. 2016. [Online]. Available
through:<https://www.merchantsavvy.co.uk/uk-sme-data-stats-charts/>
12

Peter's Jones biograpgy. 2019. [Online]. Available through:<http://www.peterjones.com/about-
peter-jones/>
Alan sugar: facts and information. 2013. [Online]. Available
through:<http://primaryfacts.com/2874/alan-sugar-facts-and-information/>
Five skills every entrepreneur should have. 2019. [Online]. Available
through:<https://www.investopedia.com/articles/personal-finance/080615/5-skills-
every-entrepreneur-needs.asp>
Importance and benefits of small business. 2019. [Online]. Available
through:<http://businesscasestudies.co.uk/nfte-uk/the-importance-of-entrepreneurship-
in-small-businesses/the-importance-and-benefits-of-small-businesses-today.html>
13