Answer in brief. Explain the characteristics/functions of entrepreneur. - Organisation of Commerce and Management

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Answer in Brief

Explain the characteristics of entrepreneur.

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Solution 1

The following are the characteristics of entrepreneurship :

  1. Economic activity:
    An entrepreneur produces a new product for the consumers as per their needs. He feels the need for this to satisfy human wants and as well in exchange earn a better livelihood. Hence entrepreneurship is an economic activity.
  2. Innovation:
    Entrepreneurship is an innovation. He brings a new product in the market, uses new production technology, discovers a new source* of supply of raw materials, and opens a new market for the specific product. In view of changing taste of consumers from time to time, entrepreneurship is of research and development to produce goods to satisfy the customers.
  3. Creative activity:
    Innovation should have strong support for creativity. Introducing creativity in producing some new is a big challenge for the entrepreneur. Thus creativity is an essential part of entrepreneurship.
  4. Organization building:
    It is an activity where various factors of production have to be organized. Different factors like place utility, time utility, form utility, etc. have to be considered to collect them under one roof for new production.
  5. Managerial skill and leadership: Leadership and managerial skills are the most important facts of entrepreneurship. Other skills can be considered secondary. An entrepreneur must have the ability to lead and manage.
  6. Risk bearing :
    An entrepreneur is an agent who buys factors of production at certain prices. In order to combine them into a product, to sell them at uncertain prices in the future. Thus they too are risk-bearing agents of production.
  7. Gap filling function:
    The most significant feature of entrepreneurship is gap filling. It is the entrepreneur’s job to fill the gap or make up the deficiencies that always exist in the knowledge about the production function.
  8. Skillful management:
    The success of any entrepreneurship depends on the management of the organization. With professional management and skilled managers, entrepreneurship becomes a successful activity.

Solution 2

According to Cantillon, “An entrepreneur is a person who buys factor services at certain prices with a view to sell the product at uncertain prices”.
Characteristics of an entrepreneur are as follows:
i. Foresees future- An entrepreneur can look into the future and identify upcoming opportunities and threats. Thus, this quality helps an entrepreneur to take proper and timely decisions.
ii. High goals- An entrepreneur always sets high goals and tries to achieve them in the best possible manner. He/she also removes the hindrances that come in his/her way, thereby achieving the objectives so framed.
iii. Positive attitude- An entrepreneur works with a positive attitude towards all activities. He/she takes all decisions confidently and never loses hopes during failures.
iv. Hardworking- An entrepreneur works hard to achieve organisational goals on time. He not only works for long hours but also handles the problems independently.
v. Creative- An entrepreneur is creative in nature. He/she either produces new things or upgrades the existing things in a new way. Thus, innovation is an essential characteristic of a successful entrepreneur.
vi. Good communicator- A successful entrepreneur needs to be a good communicator as he is required to communicate effectively with various parties such as buyers, sellers and employees.

Concept: Characteristics of Entrepreneurship
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