Little events, ordinary things smashed and reconstituted. Imbued with new meaning. Suddenly they become the bleached bones of a story, wrote Arundathi Roy. Some unreasonable men, as George Bernard Shaw would call them, fuelled by ambition and wielding the hammer of creativity forge meaning from the myriad little events and ordinary things. And when delved through the right lenses this new meaning has that familiar tinge of opportunity. These unreasonable men are what we in the new millennium generally christen Entrepreneurs – linchpins in the economy of today. What had once been a road less taken, entrepreneurship has witnessed escalating numbers of rather gallant explorers. En route, they pursue seemingly diaphanous yet omnipresent niches within the market to solve and proliferate from.
Entrepreneurs discover leaks in the iron regimes of incumbent bystander firms and gather insight from the kaleidoscope of global economies. They bridge the lull between innovation and the consumers where organizational inertia may deter sclerotic firms from seceding out of the status quo. Kodak and its missed opportunities in digital photography would suitably serve as infamous citation on forced innovation lag considering the circumstance that digital photography was its prodigal brainchild. Kodak’s decline was a direct consequence of the company’s inexcusable fears in cannibalizing its established films and chemicals based business. Plummeting sales apparently never disenchanted Kodak from staying close to its core business. Subsequently, the market dinosaur went extinct and all that remains is an iguana teetering at the precipice of bankruptcy.
Yesterday’s juggernaut companies like Xerox, Blockbuster and Blackberry have met with similar fates although to varying extents. That aside, the influx of entrepreneurs has colored the once black-and-white economies to include a broad disparate spectrum of neoteric products, services and methods of production in response to increasing demand for product variety. Thus, the most profound impact that the entrepreneur has is the innovative contribution that he or she makes.
Now, the Schumpeter entrepreneurs are heralds of progress who stimulate change in a more dynamic economy. The new entrants with their unique selling propositions creatively destruct the existing business structure and stifle incumbent firms with disruptive competition. The market besides the consumers stands to gain from this rivalry as more viable prices evolve, productivity is fostered and solely the better alternatives (like Richard Branson would say) shall stand the test of time. Intransigent firms who give the consumer a bad deal are dislodged this way.
With enhanced rivalry a shroud of ambiguity soon sails along. On one hand entrepreneurs create fresh job opportunities and this may as well be credited since it redresses unemployment issues to some degree. Evidently entrepreneurship creates jobs in the short and long terms. As people are employed, their levels of income rise and without lag their purchasing capacity. In wake of this, a vacuum for more products is set up which consequently invigorates other sections of the economy and the society. Simply put, the effect is cascading. Meanwhile, market mobility faces turbulence as people migrate from established firms to more recent ones.
Arrivals and departures run side by side; this being said it is no surprise that the debut of entrepreneurial firms may culminate in layoffs in companies which delay judicious response to changes in the market. This would be the scenario in case of a Schumpeter Mark I regime where entrepreneurs are prime movers in the economy. Probability that the preexistent firms also innovate and ride the tide of market change is a significant symptom of potential failure for entrepreneurial firms. This forms the Schumpeter Mark II regime in the economy where established firms continue at the heart of economic advantage. Therefore, the interim phases following entrepreneurship is dominated by potential failures in addition to displaced firms. No doubt exists as to whether the presence of entrepreneurial activity produces jerks in the economy, as in either of the regimes the end result is a more dynamic economy ultimately receptive to innovation. To conclude whether the change is desirable or inhibitive is reasonably complex and liable to change with state policies, GDP and prevailing business climate.
In a creatively bankrupt market, entrepreneurs contribute key value generating additions by transforming pioneering ideas and information into economically viable entities. Fortunately or unfortunately, not everyone has the required drive to become an entrepreneur. They are an extraordinary breed willing to: embrace necessary risks, create new market trajectories, imbibe and acknowledge change, cajole hitherto unnoticed opportunities and finally, inspire industry evolution. They endeavor to render more transparent businesses aimed further at solving problems rather than simply selling answers. Together these entrepreneurs form an ecosystem of innovation that promotes and fosters growth.
Businesses of the past primarily maintained a stomach for reaping and devouring high profits while the entrepreneurs of the present believe in business as a force for good. Although job creation is thought of as one of the best boons of entrepreneurship, it is certainly not the only one. This is apparent from the fact that most entrepreneurial ventures give subtle thought to charitable goals and often devote their time and resources for the sake of philanthropy. These firms sort of excel in bringing together the right resources, investing, managing, marketing and distributing them efficiently; subsequently their advice to nonprofit organizations and public services institutions would be priceless.
Our key examples in this respect shall include early entrepreneurs like Bill Gates, Elon Musk and the contemporary pioneer Mark Zuckerberg. Bill Gates has decided to shift his attention from heading the tech-giant Microsoft to making the world a better place through investments in social innovation and sustainable development. Mark Zuckerberg of Facebook has committed major earnings to charity besides his ambitions for services like the Internet.org. Elon Musk doing his part has declared public many of Tesla’s patents for the advancement of the automobile industry. All of them are encouraged to such acts of altruistic capitalism because they understand that their own success ultimately depends on nurturing the future generations.
It is fundamental to realize that entrepreneurship and entrepreneurs do not merely happen by chance. Hence, entrepreneurs of a nation are to be duly valued, nurtured and furthermore cultivated. Epochs of economic evolution reveals many firms that have failed to bloom. Causes to this may be manifold. However, at the least some of these factors can be controlled by suitable intervention in hopes of complementing entrepreneurship. One such inhibitive cause is the stereotypes concerning failure. To understand this, consider an arbitrary scenario where a newfound company was to encounter failure. It can lead to potential job and financial losses prominently to the protagonist firm and the companies immediately associated. In case the concerned firm used borrowed funds as capital, the lender too incurs losses. Rephrasing, the economic disturbance created permeates through the local economy. Society with its inane tendency to criticize severely condemns the firm for its unforeseen failure. This has adverse implications as prospective entrepreneurs are discouraged from new ventures. So, destigmatizing failure to the extent feasible should be given proper priority to combat such adversities.
Two other prohibitive aspects are overregulation and corruption. Regulatory hurdles such as stipulations on purchase of licenses and permits may deter entrepreneurship due to climbing costs. Moreover, overregulated commerce reduces market flexibility as potential innovators are discouraged from experimentation. Overboard permits and license regulations soon mimic non-competition agreements in the market which for obvious reasons is unfavorable. Complex, opaque and inconsistent legal code further makes it difficult to rightly judge the legal environment for entrepreneurial activity. Swift and comprehensive codification of the pertaining legal code, inclusive of amendments shall be an appropriate course of action to address this. Corruption regarding protection of intellectual property rights is another promenade of concern. This has in truth created a web of uncertainty for the would-be entrepreneurs. A balanced approach must therefore be applied to ensure that quality and ethics is maintained while simultaneously reducing extant impedance to entrepreneurship.
Entrepreneurship is expected to be a tremendous force in the future. When a subject becomes totally obsolete, we make it a required course (Peter Drucker). When change has desiccated from the economy, intransigent firms flourish and redundancy blows hard, the entrepreneurs shall hail forth the silver lines of innovation because like Charles F Kettering said “The world hates change, yet it is the only thing that has brought progress”. This is the ecstasy of entrepreneurship.