Entrepreneurship and Small Business Management: A Report on UK Economy

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ENTREPRENEURSHIP AND SMALL
BUSINESS MANAGEMENT
1

Table of Contents
LIST OF FIGURES.......................................................................................................................3
INTRODUCTION........................................................................................................................4
PART 1...................................................................................................................................... 5
LO1 WRITTEN REPORT..............................................................................................................5
1. THE VARIOUS TYPES OF ENTREPRENEURIAL VENTURES WITH REFERENCE TO
TYPOLOGY OF ENTREPRENEURSHIP.....................................................................................5
2. THE DIFFERENCES AND SIMILARITIES BETWEEN SERIAL ENTREPRENEURS,
INTRAPRENEURS AND OWNER MANAGERS.........................................................................7
3. THE PUBLIC AND CORPORATE SECTORS AND DEMONSTRATING VARIOUS
ENTREPRENEURIAL VENTURES.............................................................................................8
4. THE SCOPE, GROWTH AND DEVELOPMENT OF ENTREPRENEURIAL VENTURES............9
PART 2.................................................................................................................................... 11
LO2......................................................................................................................................... 11
1. THE IMPACT OF MICRO AND SMALL BUSINESS IN UK ECONOMY AND INTERPRETING
THE RELEVANT DATA RELATED TO THE SAME....................................................................11
2. THE CONTRIBUTION OF SMALL BUSINESS AND BUSINESS STARTUPS IN THE GROWTH
AND DEVELOPMENT OF SOCIAL ECONOMY.......................................................................12
3. THE EVALUATION AND ANALYSIS OF DIFFERENCES IN SMALL, MEDIUM AND LARGE
BUSINESSES IN CONTEXT TO LOCAL, REGIONAL AND NATIONAL LEVELS OF THE ECONOMY
13
PART 3.................................................................................................................................... 14
LO3 & LO4.............................................................................................................................. 14
1. THE CHARACTERISTICS TRAITS AND SKILLS OF ALAN SUGAR......................................14
2. THE ANALYSIS OF ENTREPRENEURIAL PERSONALITY OF RICHARD BRANSON THAT
REFLECTS THE ENTREPRENEURIAL MOTIVATION AND MIND-SET WITH THE HELP OF HIS
ENTREPRENEURIAL CHARACTERISTICS...............................................................................15
3. THE ANALYSIS OF TRAITS, SKILLS AND MOTIVATIONAL DRIVERS OF SUCCESSFUL
ENTREPRENEURS................................................................................................................16
4. THE EVALUATION OF DIFFERENT ENVIRONMENTS THAT FOSTER OR HINDER
ENTREPRENEURSHIP.......................................................................................................... 17
CONCLUSION.......................................................................................................................... 18
REFERENCES........................................................................................................................... 19
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LIST OF FIGURES
Figure 1 Growth of Private Sector Business In the UK............................................................14
Figure 2 Business share according to Business Size in the UK................................................15
3

INTRODUCTION
This report contains the study of entrepreneurship and management of the small business
which helps in building the entrepreneurial skills. The beginning of every large business
starts with the small business promoted by an entrepreneur. Whether the business is large
or small for the survival of the business, the most important requirement is entrepreneurial
skills. To handle new business, proper training and learning are required which gives
effective decisions. The skills of motivation and leadership are equally important. The
entrepreneurial skills differ from individual to individual according to business, life
experiences and the knowledge that they pursue.
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PART 1
LO1 WRITTEN REPORT
INTRODUCTION
This segment explains the investigation of the various types of ventures that impact the
economy as a whole.
1. THE VARIOUS TYPES OF ENTREPRENEURIAL VENTURES WITH REFERENCE TO
TYPOLOGY OF ENTREPRENEURSHIP
An individual is said to be the entrepreneur when he pursues some skills and knowledge of
leadership and how to innovate the changes by bringing new concepts so as to become
unique among the competitors. An entrepreneur conceives the idea and implements the
same by taking the risks and investing the capital to promote the business in the market by
generating the demand for the products and services (Kuratko, 2016).
The entrepreneurship is the process of creating new approaches within the business for
organizing, managing and guiding the people towards the organizational objectives.it leads
to the development and changes in the business organization in a positive manner.
It is the fact that nowadays in every business and every sector, the efficient entrepreneurs
and effective entrepreneurship skills have become the fundamental requirement. An
effective entrepreneur is confined to not only within the organization but it also represents
and influences the overall economy (Kuratko, 2016).
The various typologies of entrepreneurship within the business organizations are
explained as under:
Large Corporations: Large organizations consist of a life cycle that involves continuous
growth and sustainability by innovating new products and services and also through the
demand for existing products and services. Large corporations always have competitors' in
the market and therefore it is important for such organizations to innovate the products and
services according to the changing trends, which is only possible with the help of efficient
entrepreneurs (Morris et al., 2018).
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Small Corporations: There was a remarkable growth in the startups of new businesses in
the UK. These startups generated huge employment opportunities about 19.8%. In the UK.
Local supermarkets, consulting companies, internet cafes, automobile retailers, etc. were
some of the small startups in the UK in the last few years. All such establishments took place
because of some members called entrepreneurs (Morris et al., 2018).
Scalable Startups of Business:
Such types of ventures have the goal to change the existing plan and always aim at quality
and creativity and innovation. Therefore, in such business efficient employees are required.
Scalable means to expand capital and investment with some innovations (Morris et al.,
2018).
Serial Entrepreneurs:
Serial entrepreneurs are the individuals that conceive the idea of setting up or promoting
the business, which is later managed by the successor on the basis of pre-planned
strategies. If in the future, the process is required to be repeated for that some investment
is retained by the serial entrepreneur (Morris et al., 2018).
Intrapreneurs: The Intrapreneurs involves the authorized employees of the company who
are involved in the decision-making process of the management for the creativity and
innovation of the products and services (Morris et al., 2018).
Lifestyle Entrepreneurs: Such entrepreneurs have the passion and are focused on the things
they love to do instead of aiming at earning the profit in the business (Morris et al., 2018).
Social Entrepreneurs: The main goal of such entrepreneurs is to solve the problems of the
society and whatever the profits are generated from the business instead of distributing it
among the shareholders, it is reinvested in the business for the betterment of the society
(Morris et al., 2018).
Independent Entrepreneurs: These entrepreneurs are self-driven i.e. the management of
the business and the related activities are controlled by themselves. The self-taking decision
makes several tasks easier to perform by outsourcing the tasks to the available workers
(Morris et al., 2018).
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2. THE DIFFERENCES AND SIMILARITIES BETWEEN SERIAL ENTREPRENEURS,
INTRAPRENEURS AND OWNER MANAGERS
The following represents the difference between serial entrepreneurs, Intrapreneurs and
owner managers (Adachi and Hisada, 2017).
Basis Serial Entrepreneurs Intrapreneurs Owner Managers
Meaning The creator/founder
of an enterprise who
takes the risk to earn
a profit.
An employee of the
organization
authorized to involve
in the decision
making for innovative
ideas for products
and services.
Responsible
individual who
controls and
administers the
business.
Risk Self-borne Taken by the
organization
Involved in taking
the risk.
Main Aim To earn a profit by
creating
opportunities.
To earn rewards with
help of the skills and
abilities.
To get promote
and to provide
rewards to the
staff.
Status Owner of the business An employee of the
same business.
An employee of
the same business
Reward Profit Salary/Rewards. Salary
Decision making Spontaneous,
involuntary
Recuperative. Rational
Driving force The innovation of new
ideas and creativity
Changing and
renewing the existing
business structure.
Preserves the
existing state of
affairs
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The following represents the similarities of serial entrepreneurs, Intrapreneurs and owner
managers (Adachi and Hisada, 2017).
Entrepreneur and Intrapreneur Entrepreneur and Manager
Vision and Strategy is required Power of decision making
Leadership skills used to be successful Well-known of the business
The process of planning, building,
validating, and launching is the same
Pursues the knowledge of the business
environment
Both create various opportunities for
innovation
Ability to manage business
Ability to forecast.
3. THE PUBLIC AND CORPORATE SECTORS AND DEMONSTRATING VARIOUS
ENTREPRENEURIAL VENTURES
In public sector enterprises, as the management of public sector enterprises is done by the
government, the entrepreneurship skills are with the government. Whatever the changes
are required to be made in the organizational unit, the government ideas are required to be
implemented. The employees are not offered to share in profits in public sectors
(Emontspool and Servais, 2019).
In the corporate sector entrepreneurship, there is the establishment of new ventures with
different innovations and development of new products and services as well as changing the
existing business structures. At every level of the organization, there should be
entrepreneurial skills cultivated among employees.
There are different types of entrepreneurship ventures which can be classified on the basis
of ownership, size of enterprises and gender as under (Emontspool and Servais, 2019):
(i) Based on Ownership:
Private: In private ventures, the entrepreneurs reflect the group of people focused mainly
to earn profit instead of societal welfare. The main aim is to maximize the profit by
improving the products and services that will lead to the growth of the business enterprise.
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Public: In public ventures, the enterprise is managed and controlled by the government. So
the entrepreneur in such case aims to work for society and does not involve activities that
are highly risky.
Voluntary: Involuntary ventures, the entrepreneurs focus mainly on the welfare of the
society by providing them with basic amenities without the aim of earning the profit.
Voluntary ventures are controlled and managed by a group of people and the funds
collected as a part of a donation for the benefits of the society (Emontspool and Servais,
2019).
(ii) Based on the size of the business:
Small-Scale Enterprise: The enterprises where there are less than 10 employees working
generate the turnover below £2 million are the micro-enterprises. While the small
enterprises employee approx. 50 employees and not more and the turnover of such
enterprises is about £10 million.
Medium-Scale Enterprise: The medium scale enterprise employs about 250 employees to
generate a turnover of £50 million.
Large-Scale Enterprise: In the large scale enterprises, there are more than 250 employees
that generate the turnover of more than £50 million (Emontspool and Servais, 2019).
(iii) Based on gender:
Men: The men entrepreneurs involve the male based enterprise that owns, manages and
controls the business and business activities.
Women: If the business enterprise is wholly or partially that consists of 51% profit sharing in
the hands of women which is monitored and controlled under the women guidance are
known as women based enterprises.
From the above discussion, it is justified that, public sector enterprises are rigid in nature
due to the involvement of political factors, while in corporate sectors, they have the honour
to work on their abilities and to develop their management culture (Emontspool and
Servais, 2019).
4. THE SCOPE, GROWTH AND DEVELOPMENT OF ENTREPRENEURIAL VENTURES
At every level of companies, entrepreneurial skills are important. As the recession period is
decreasing gradually in the UK, the scope and development sector has been increased.
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Investment in new businesses is made and most of the adults are focusing to become an
entrepreneur rather than doing the job (Emontspool and Servais, 2019).
Apart from this, entrepreneurship, intrapreneurship and managerial entrepreneur are the
most basic requirement of any venture. Innovation is the basic key of every individual which
has increased many startups in the UK.
According to the statistics, the scope and growth of such ventures are totally opened as
99.03% business are established as a small business. So there are the chances that the small
enterprises will capture the whole competitive market (Emontspool and Servais, 2019).
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PART 2
LO2
1. THE IMPACT OF MICRO AND SMALL BUSINESS IN UK ECONOMY AND
INTERPRETING THE RELEVANT DATA RELATED TO THE SAME
In the UK after the recession, the number of micro and small enterprises has increased.
These companies need funds either during the startup or in the middle of the journey. From
the past 3 years, small businesses are getting 60% of the funds invested from outside i.e.
loans for business startups. The reasons for taking funds are different like to start or to
expand the business, to issue the capital or to acquire the assets (Burns, 2016).
Thereafter there were many technological changes after the financial crisis in the year 2008,
many financial institutions lose their trustworthiness. Even banks started providing secured
loans to businesses. The loans and grants for business startups were accessible online. So it
became easier for the small business enterprises to take the loans for the startups through
online platforms.
Small business enterprises have created many job opportunities which have led the
economic growth. In present there are 5.7 million private sector small business enterprises
in the UK according to 2018 report as compared to the report of 2000, this was around 3.5
million. In short, there is a 63% increase in the number of small business enterprises (Burns,
2016).
About 60% of employment is generated by small business enterprises. £2 million was the
aggregate turnover of small business enterprises among which 52% consists of private
sector units (Rhodes, 2018).
It has revealed from the research of Hamsphire Trust Bank and Centre for Economics and
Business Research that £196 billion of business contributed to the growth of 11% between
2015 to 2020. Till 2020, the contribution to the UK economy may raise up to £217 billion
from small business enterprises of 10 UK cities (Burns, 2016).
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Figure 1 Growth of Private Sector Business in the UK
(Source: Burns, 2016)
Examples of such small business enterprises are Viacom in the IT sector, Uber, Airbnb etc.
have created a huge competition in the market of the UK. As London is the pinpoint for
small business enterprises the contribution of it in the economy will increase by 2020 from
£149 billion to £164 billion i.e. about 76% contribution in the UK economy (Burns, 2016).
It is to be determined that the importance of small business enterprises has contributed
much in the growth of the economy by generating an aggregate turnover of £2 trillion in the
last year. Microenterprises are the vital part of the UK economy as it contributed the
innovation growth and also introduced new entrepreneurs in the market (Burns, 2016).
2. THE CONTRIBUTION OF SMALL BUSINESS AND BUSINESS STARTUPS IN THE
GROWTH AND DEVELOPMENT OF SOCIAL ECONOMY
In the growth of the social economy, small business has played a vital role. Such businesses
are successful because they focus mainly on the local requirements like photography
services, catering, printing and stationery, financial consultants, etc. The factors of the social
economy supported both; public and private sectors (Cowling et al., 2015).
Simon Woodroffe came with the starting up the business of restaurant and had become the
successful business in serving the food and drink. Another example Henry John Heinz the
supplier of pickles, vinegar and sauerkraut by wagons using a horse to grocers. Apart from
this, he also developed baby foods, tomato ketchup and baked beans.
In the UK, 2/3rd of the population are entrepreneurs and less than 6 employees are
employed by 90%. In every sector, 99.5% of the contribution if made by small business
accounts (Rhodes, 2018). Small businesses are mainly involved in services like, personal
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