With all due respect to my distinguished colleagues, while each of us may have a different definition of entrepreneurship, (and neither of the two mentioned reflect my own beliefs)
I hardly think tossing out personal preferences on this listserv will accomplish very much. A good review article on the subject would be welcome – and no doubt – such a review article would be unable to draw a definitive conclusion. Our own interpretations are, at the end of the day, typically a matter of philosophical perspectives. Given that we are researchers, our definitions are far from ‘facts’ and need only be clearly disclosed for the particular forum we are engaging with.
Regards
Benson
--
Benson Honig Ph.D.
Teresa Cascioli Chair in Entrepreneurial Leadership
DeGroote School of Business, McMaster University
Hamilton Ontario Canada L8S4M4
Tel: 905-525-9140 ext. 23943
Cell: 905-518-1716
Email:
Bhonig@mcmaster.ca
On 2016-06-23, 8:55 AM, "Entrepreneurship Division Listserv on behalf of Charles Hofer" <
ENTREP@AOMLISTS.PACE.EDU on behalf of
chofer@KENNESAW.EDU> wrote:
>All,
>
>A few weeks ago Franz Lohrke posted a "Definition" of Entrepreneurship.
>I strongly disagree with his definition and suggest the following instead.
>
>Franz Lohrke’s Entrepreneurship Definition was as follows
>
>If fortune favors the bold, luck happens when preparation meets opportunity,
>and entrepreneurship occurs when enterprising individuals find valuable
>opportunities, then fortunate (or lucky) entrepreneurs, who build valuable
>enterprises, are often those individuals, who are both bold and prepared.
>
>My Observations on Lohrke’s Definition of Entrepreneurship are as follows.
>
>There is no need to include “fortune” or “luck” or even “preparedness” in
>any definition of entrepreneurship. However, as David Birch’s pioneering
>research [Job Creation in America. New York: Free Press.1987] clearly
>demonstrated, during the mid-20th Century the vast majority (>80%) of all
>new jobs in the U.S. were created by what he (Birch) called “gazelles”,
>i.e., high growth new ventures. [Note: Birch’s later works extended these
>findings to most developed economies] And, since the primary goal of
>Entrepreneurship is to create such high growth new ventures (not small
>businesses that will remain small), leaving job creation out of any definition
>of entrepreneurship is an oversight of the first magnitude, i.e., it is
>such a major oversight as to make any definition of Entrepreneurship that
>excludes job creation essentially worthless.
>
>I suggest the following Entrepreneurship Definition instead.
>
>Entrepreneurship occurs when an individual (or team) identifies an opportunity
>to create value for their customers and themselves by providing products (or
>services) that satisfy previously unmet customer needs; and in the process
>of doing so build new organizations that create jobs for their employees and
>value for their suppliers.
>
>I also offer some additional observations on the Definition of Entrepreneurship
>
>From an economic perspective, we are living in the greatest period in human
>history. Today, the average annual income and personal wealth of people around
>the world is higher than at any other time in human history. Why? It’s because
>of the progress of business around the world. More specifically, it’s because
>business is the primary organ of society that drives innovation (the creation
>of new products and services) and productivity (the production of existing
>products and services more effectively, efficiently, and economically). In this
>context, existing businesses are, in general, the primary drivers of productivity.
>For instance, the average cost of an inexpensive new car today, such as a Ford
>Focus Sedan, is just over $16,000 U.S. By contrast, the average cost of the
>initial 1908 Model T Ford adjusted for inflation was about $40,000 in today’s
>dollars. And that Model T did not have any of the safety features now mandated
>by federal law. Nor did the Model T have today’s fuel efficient engines, power
>steering, air conditioning, and myriad other features that most of us now consider
>necessities for a new car. And, this example could be repeated for most other
>existing products and services, such as food, housing, radio, television, etc.,
>etc. In short, the myriad productivity advances made by existing businesses
>have enabled most members of our society to enjoy a better standard of living
>than at any other previous period in human history. By contrast, new ventures,
>in general, are responsible for introducing most new products and services to
>our society. Apple, Facebook, Google, Microsoft, and Twitter are just a few of
>the thousands of new companies that have introduced such new products to today’s
>society over the past half century.
>
>This dichotomy between the roles of existing and new businesses can be better
>appreciated by examining the examining the employment demographics of various
>groups of individuals in society. In ancient Egypt, there were only about six
>major groups of “employees”: (1) The Political Leaders [Pharaohs]; (2) The
>Religious Leaders [High Priests]; (3) The Military Leaders and Soldiers; (4)
>The Farmers who produced the food; (5) Those who produced clothing, weapons,
>jewelry, and all of the other products available in ancient Egypt, and (6)
>Merchants [Who traded these goods and services]. At that time, over 70% of the
>total population was engaged in farming. By the end of World War II, only about
>7% of the total U.S. population was engaged in farming, and today that number
>has decreased to less than 3%. The most significant aspect of this statistical
>comparison is the fact that such reductions in the percentage of any society’s
>population employed in any business activity associated with that society MUST
>decrease over time. Why? Because, if this does not happen, there will be no
>one available to produce the various new products and services that are invented
>and brought to market by entrepreneurs. Put differently, for Apple, Facebook,
>Google, Microsoft, and Twitter and all other new ventures to grow, the number
>of people employed in auto production, farming, and making and selling all
>other existing products and services must decrease.
>
>Franz Lohrke’s definition of Entrepreneurship totally overlooks this second
>reality of the entrepreneurship process, namely that entrepreneurship not only
>involves the creation of new products and services, it also involves the creation
>of the new jobs that are associated with the production of these new products and
>services. The key point here is that existing businesses must (1) improve the
>overall quality and effectiveness of the existing products and services they make,
>and (2) make these existing products and services at lower prices and costs [from
>a constant dollar perspective] in order to grow and prosper, which in turn means
>that they must make these existing products and services with fewer employees. Put
>differently, if entrepreneurs did not create new products and services, which by
>necessity involves the creation of new jobs to produce these new products and
>services, there would be an increasing percentage of our population that would be
>unemployed. In short, any definition of entrepreneurship that does not include
>entrepreneurship’s role in job creation is not worth the paper it’s printed on.
>
>The Role of Innovation & Productivity in Human Economic Progress
>
>According to Peter Drucker, the basic purpose of business is to create a customer.
>If so, then Innovation and Productivity are the two basic functions of business
>because
>1. Business is the organ of society charged with the creation of economic growth
>2. Innovation & Productivity are the two engines that drive all economic growth
>3. Therefore, Innovation & Productivity are the two basic functions of all business!
>
>Respectfully,
>Dr. Charles Hofer
>770-455-4280 Cell 1
>770-757-3575 Cell 2
>
>
>
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Please do not post messages with attached files. Commercial messages or spammed messages are not allowed on the list. The use of auto-responder "out-of-office" messages may also lead to your removal from the list.
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If you have questions or need help, please contact Jeff Pollack (
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Ventures HO!