Academic journal article Journal of Small Business Management

Defining Entrepreneurship

Academic journal article Journal of Small Business Management

Defining Entrepreneurship

Article excerpt

DEFINING ENTREPRENEURSHIP

We continue to know very little about entrepreneurs, even though there is much interest and many publications on the subject. Much of the material is fragmented and highly controversial. For example, self-employed individuals and business proprietors may be surprised to learn that some academics and researchers would suggest they are not really "entrepreneurs" but "small business owners." Indeed, many people who have long perceived themselves to be successful entrepreneurs would not fit some of the definitions which are now being proposed.

Selection of the appropriate basis for defining and understanding the entrepreneurial person creates a challenging problem for academic researchers and writers. The field of research has been described as young, at a formative stage, and still in its infancy (Paulin et al. 1982, Perryman 1982, Peterson and Horvath 1982, Sexton 1982). There is generally no accepted definition or model of what the entrepreneur is or does (Churchill and Lewis 1986). In the past decade, a number of trends have emerged which distinguish between individual entrepreneurship and corporate entrepreneurship (Wortman 1987), and entrepreneurs and small business owners (Carland et al. 1984). The literature abounds with criteria ranging from creativity and innovation to personal traits such as appearance and style. Models of the entrepreneurial leader are almost as plentiful as the number of authors who write about them.

A large literature has developed ranging from academic studies to prescriptive blueprints for setting up new ventures. The term "entrepreneur" has often been applied to the founder of a new business, or a person "who started a new business where there was none before" (Gartner 1985). In this view, anyone who inherits (Henry Ford II), or buys an existing enterprise (George Steinbrenner's purchase of the Yankees), or manages a turnaround as an employee (Lee Iacocca) is by definition not an entrepreneur. Others reserve the term to apply only to the creative activity of the innovator (Schumpeter 1934). With this last definition, the majority of those pursuing entrepreneurial and business activities would be excluded. Yet, others refer to the identification and exploitation of an opportunity as entrepreneurial (Peterson 1985). Those who develop a niche in the market or develop a strategy to satisfy some need are also, by some, called entrepreneurs (Garfield 1986).

There exist a number of schools of thought which view the notion of entrepreneurship from fundamentally different perspectives. The term has been used to define a wide range of activities such as creation, founding, adapting, and managing a venture. No single discipline provides the tools for managing an entrepreneurial venture (Stevenson 1988). With such a variation in viewpoints, it is not surprising that a consensus has not been reached about what entrepreneurship is.

This article describes six schools of thought and attempts to show how they may be useful for understanding the entrepreneurial process. These schools offer unique viewpoints to illustrate what the entrepreneur does and what functions and processes are key.

SCHOOLS OF THOUGHT

ON ENTREPRENEURSHIP

Although an agreed-upon definition may serve to unite the field, research activity seems to fall within six schools of thought, each with its own underlying set of beliefs. Each of these schools can be categorized according to its interest in studying personal characteristics, opportunities, management, or the need for adapting an existing venture. Assessing Personal Qualities

1. The "Great Person" School of Entrepreneurship

2. The Psychological Characteristics School of Entrepreneurship Recognizing Opportunities

3. The Classical School Entrepreneurship Acting and Managing

4. The Management School of Entrepreneurship

5. …

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