CHAPTER 2

Entrepreneural Character Traits Skills And Competencies

Entrepreneural Character Traits

 The term Character Traits in this lesson refers to the mark or

attribute that distinguishes an entrepreneur from the owner of
an ordinary small business.
 Based on studies conducted by the Small Enterprise Research
and Development Foundation(SERDF) of the Department of
Trade and Industry (DTI), there are ten entrepreneurial
characteristics grouped into three major clusters:

1. Achievement Cluster

2. Planning Cluster

3. Power Cluster

Achievement Cluster

 consists of entrepreneurial character traits that are directly

related to the entrepreneur's desire to be an achiever in the field
of entrepreneurship.
 Successful entrepreneurs constantly set the things to be
achieved and repeatedly find ways to achieve them.

The entrepreneur who belongs to the achievement cluster is

1. An opportunity-seeker
2. Committed oriented
3. Persistent
4. A risk-taker
5. Efficient and quality-oriented
Opportunity seeker

A person who dreams of becoming successful entrepreneur must be a

seeker business opportunities.

A business opportunity-seeker is an entrepreneur who

1. sees and acts on new business opportunities; and

2. seizes unusual opportunities to obtain financing, equipment,

land, work, space and assistance.

 Business opportunities may arise from changes in the

environment, advancement and discoveries in technology,
government programs and policies, people’s interest, hobbies
and past experiences.
 Successful entrepreneurs do not just watch business
opportunities pass by but readily seize them.
 They do not let entrepreneurial opportunities go to way but
immediately act upon them. They perform what they can do or
accomplish today. This cannot wait for tomorrow to come.

Commited

 A highly committed entrepreneur display full committed to the

work or endeavor that he/she is undertaking.
 Commitment is directly related to interest.
 Lack of Interest means lack of commitment

Persistent

 Trials, sacrifices, and failures challenge the entrepreneur to be

persistent.
 The terms “quit” and “surrender” are not included in the
vocabulary of successful entrepreneurs.
 Persistent is the foundation of commitment
Risk Taker

 Successful entrepreneurs are business risk- taker.

Three types of risk-takers
1. Aggressive risk-taker
2. Moderate risk-taker
3. Conservative risk-taker

Efficient And Quality Oriented

 A successful entrepreneur highly values efficiency and the

concept of quality in all business undertakings. He/ She
1. Always performs the required tasks in accordance with existing
standards of excellence or continuously improves on his/ her
past performance and
2. Strives to do things better and faster with minimal cost.

Planning Cluster

Is a set of characteristics of successful entrepreneurs that basically

supports the character traits in the achievement cluster.

The entrepreneur who belongs to the planning cluster is

1. a goal-setter
2. an information-seeker
3. systematic in planning and monitoring

Goal Setter

 The basic concepts of planning is setting goals and objectives.

Goals and objectives are the guiding points that direct all
actions, efforts and struggles of the entrepreneurs
 In setting the goals and objectives of the business venture, the
entrepreneur is usually guided by the SMART principle. This
means that the goals and objectives are specific, Measurable,
Achievable, Realistic and Time-bound
Information Seker

 Entrepreneurs constantly make decisions that will affect the

operations of their business ventures.
 In the Philippines, offices that are expected to have the required
information often do it actually have them. The usual constraints
or limitations encountered in the gathering of information are
data banks that
1. Are incomplete, dated and irrelevant
2. Are costly in maintenance
3. Lack personnel to maintain them

Systematic In Planning And Monitoring

Systematic

 Implies that there is a rational and logical approach in

performing activities. There are step by step procedures that
are scientifically designed to be followed in the preparation of
plans and monitoring of activities

Planning

 refers to the setting of goals and objectives.

Monitoring

 refers to the evaluation of the activities and adopted courses of

actions whether they are carried in accordance with the plans.

Power Cluster

 The power cluster includes a set of character traits that reflect

the degree of the interpersonal relations maintained by
successful entrepreneurs with the suppliers of raw materials,
financial institutions, customers, competitors, the government,
employees, and all other stakeholders.
 Power is all about title, position, authority, control, and
supremacy, you’ll find it a challenge. Entrepreneurs can give
themselves any title or position they want. They have complete
 authority to do whatever they want whenever they want, and
they have ultimate control.

An entrepreneur in the power cluster is

 A persuasive and positive networker

 Self- confident

Persuasive And Positive Networker

Persuasion

 Is the capacity of the entrepreneur to convince people.

Networking

 Is the entrepreneurs abilities to bind and merge their business

with others companies of business items.

Self Confident

 Self confidence is a key entrepreneurial skill for success.

 Self- confidence is concerned with how a person feels
about his ability.
 Self- confidence is concerned with how a person feels about his
ability. A successful entrepreneur believes in his abilities. He is
not scared to explore un-chartered territories, take risk and take
difficult decisions.
 A person can have high self- confidence in one situation and
totally lack in another.

Entrepreneurial Skills

 SKILLS are considered as the personal abilities to do things

well. They come from the totality of the knowledge, practice or
experience and aptitude of a person.
  It required and developed by a person through constant and
correct practice. They connote dexterity, excellence and
expertise in the performance of particular tasks.

Cognetive Skills

 mental ability of the entrepreneur to learn new things, generate

new ideas and express knowledge in both oral and written
forms.
 The human brain is responsible for the development of
cognitive skills, which are essentials in making systematic and
effective plans and monitoring them.

Cognitive Skills Of An Entrepreneur Include

 Ability to understand written material.

 Ability to learn and apply new information.
 Ability to solve problems systematically.
 Ability to create new ideas.
 Ability to innovate new products and procedures or methods.

Problem Solving Skill

Problems are common in the life of an entrepreneur as he/she

manages the day-day-day operations of the business venture. These
problem can be big or small, ordinary or unusual, and repetitive or non-
repetitive.

To be labeled a problem, a situation must have something about it

which is believed to be difficult.

The task of pinpointing or defining or clarifying or analyzing a problem

may be difficult or the task of solving it may be difficult or both. In other
instances solving the problem is easy.

The Scientific Approach In Solving Business Problems Involves

1. Defining the real problem

2. Gathering information about the problem,
3. Formulating alternative solutions,
 4. Evaluating alternative solutions
5. Selecting and implementing the optimal solution
6. Evaluating the decision

Defining The Problem.

 every problem solving methodology the first step is defining or

identifying the problem.
 most difficult and the most important of all the steps.
 involves diagnosing the situation so that the focus on the real
problem and not on its symptoms

Gathering Information About The Problem

 purpose of information gathering is to support the planning of

your organization's work to become more fully inclusive.
 important to look at available facts objective information,
including demographics and best practices.

Formulating Alternative Solutions

The entrepreneur must keep in mind that a problem always has

alternative viable solutions. Otherwise, it is not a problem he /she must
list down all the possible solutions to the problem

Alternative solutions grouped by categories:

1. Effect to the business in general

2. Effect to the work force
3. Effect to the supplier of raw materials and utility provider
4. Effect to the end user and prospective consumers
5. Effect to the future operation
6. Effect to other departments or units
7. Effect to the financial, marketing, and production operations

Evaluating Alternative Solutions

In higher marketing, operation and production management, and
operation research courses, there are quantitative approaches in
evaluating the optimal solution to the problem

In the process of evaluating each alternative solution, the following

criteria must be considered

In the process of evaluating each alternative solution, the

following criteria must be considered:

1. Availability of production resources

2. Cost involved in the implementation
3. Degree of the risk involved
4. Effect to the whole business
5. Nature, type and size of the problem
6. Level of urgency
7. Different forces in the environment

Selecting And Implementing The Optical Solutions

 The optical solution creates the highest contribution to the

revenue of the business or the lowest contribution to the
incurrence of cost. Unless the decision is implemented, the
problem will not be solved.
 The decision either be effective or not. It is effective when it
solves the effect of problem.
 There is no such thing as the “ best solution” but only one that
is deal or which when implemented will not create another
problem.

Evaluating Decisions

 decision maker must continuously search for the most optimal

solution.
 Another objective in evaluating the solution is to determine
whether there are changes in the environment or some
developments that make the solution already undesirable

Technical Skills
  abilities and knowledge needed to perform specific tasks.
 practical, and often relate to mechanical, information
technology, mathematical, or be scientific tasks.

Some examples include knowledge of programming languages,

mechanical equipment, or tools.

The technical skills focus mainly on the mechanical or practical aspect

of a person rather than his/her abstractor theoretical thinking. The
technical skills are the external replica of a person’s cognitive skills.

The technical skills of an entrepreneur include proficiency and ability,

among others, in the following areas

1. Information Technology
2. Feasibility study and business plan preparation
3. Technical writing skills
4. Marketing
5. Management and Finance

Interpersonal Skills

 Interpersonal skills are basically about the relationship and

interaction of the entrepreneur with the workers, suppliers,
creditors, prospective customers and other members of the
business community.

The interpersonal skills of an entrepreneur may include, among

others, the following:

1. Skills in verbal communication

2. Skills in non-verbal communication
3. Skills in listening
4. Skills in leading
5. Skills in negotiating

Core Competencies
  person who aspires to become a successful entrepreneur must
fully understand and apply the concepts and principles of
entrepreneurship.
 He/ She must possess and internalize the character traits that
are common among successful entrepreneurs.

The Competitive advantage refers to the strategic position and

condition of the entrepreneurial venture that

1. Provides the necessary attributes to outperform competitors

2. Distinguishes the venture from competitors
3. Achieves superior performance in the industry and
4. Produces a product or develops production methods that can
hardly be copied by competitors.

Total Perspective Of Successful Entrepreneur

to ensure victory as a future entrepreneur you must:

1. Understand fully the concepts and principles of

entrepreneurship
2. Internalize and live out the character traits that are common
among successful entrepreneurs; and
3. Acquire, develop, sharpen and focus your entrepreneurial skills

Doing all of these will define your core competencies and provide and
establish your competitive advantage in the business world
 Preliminary Activities Of Entrepreneurial Venture Creation

WEEK 6

THE PHYSICAL ENVIRONMENT

Nature And Environment

 entrepreneurial venture is created out of the business

opportunities which the entrepreneur should seek to exploit.
 These business opportunities emerge from the entrepreneurial
ideas that arise from the changes in the environment,
government policy, or technological advancements

The entrepreneur needs to possess the necessary entrepreneurial

character traits, skills, and competencies before exploiting the business
opportunities.
Entrepreneurial Character Traits, Skills, and Competencies
Influencing the Opening of Business

If a prospective entrepreneur possesses the necessary character traits,

skills, and competencies, should he/she immediately open a new
business in order to exploit the business opportunity
The answer is a big “NO.” He/she must first evaluate and analyze first
the business environment. The environment where the business
venture will operate is an important factor to consider in opening a new
business

THREE LAYERS OF ENVIRONMENT

1. Physical Environment
2. Social Environment
3. Industry Environment
PHYSICAL ENVIRONMENT OR
NATURAL ENVIRONMENT
Composed of the natural elements that
are inherent in the Earth. It is divided into
climate, physical reso urces, and wildlife.
CLIMATE

 must consider the prevalent

climatic condition of the area where he/she intends to open the
business to determine whether it can withstand or is fit to the
climatic condition in the local area.
PHYSICAL RESOURCES
The availability of raw materials is another major factor that can
influence the success or failure of the business venture.
  Determine the cost of the products.
 Products that are made from rare raw materials will definitely
cost more than those that are made from common ones.
 Assess the availability of raw materials in the locality before
opening a new business.
 Evaluate if the available raw materials to be used for the
proposed business are sufficient for a long – term operation
WILDLIFE

 Entrepreneur must ensure that

 his/her business contributes to
 the preservation and not the destruction of the ecological
system of the local community and our country in general.
 Must not open a business venture that will destroy the wildlife
reserve