ST.

ANTHONY COLLEGE Module for

CALAPAN CITY INC. Entrepreneurial Mind

MODULE DESCRIPTOR
This unit explains the Entrepreneur: Born or made? It includes Entrepreneurship
and Economic Development, Entrepreneur’s Task, Entrepreneurship and Innovation and
Entrepreneurship and Business Size.

NOMINAL DURATION
Aug. 31- Sept. 3 (3 hours)

LEARNING OUTCOMES
At the end of this module, you MUST be able to:
1. explain the contributions of entrepreneurship to society, business firms, and
customers;
2. discuss the concept of entrepreneurship; and
3. explain the entrepreneur’s task.

LEARNING EXPERIENCES

Learning Activities Special Instructions

1. Read Information Sheet about In the learning outcome, you must
Entrepreneur: Born or made. explain the contributions of
2. Answer Self- Check and compare your entrepreneurship to society, business
answer with the Answer Keys. firms, and customers, discuss the
3. Perform Task Sheet by following the concept of entrepreneurship and explain
given instruction. the entrepreneur’s task. To be able to do
4. Perform Job Sheet by following the this, you should understand the
given instruction. following:
1. Entrepreneurship and Economic
Development
2. Entrepreneur’s Task
3. Entrepreneurship and innovation and
4. Entrepreneurship and Business Size.

Go through the information sheets and

answer the self- check to ensure that
knowledge context of concept of
Entrepreneur: Born or made is acquired.
5. Evaluate your own output using the After doing all these activities, you are
performance criteria. ready to proceed to the next module.
 ST. ANTHONY COLLEGE Module for
CALAPAN CITY INC. Entrepreneurial Mind

INFORMATION SHEETS 2.1-1

Entrepreneurship is a very important component of a capitalist economy like the

Philippines. It thrives in the economic systems that support innovation and hard work.
When entrepreneurs become successful, the nation is immensely benefitted.
What is entrepreneurship and how does it affect the economic well-being of many
people? What is the task of entrepreneur regarding economic development? This module
will answer all the concerns stated above.

Entrepreneurship and Economic Development

Economic Development is a scheme aimed at improving the living standards of
the nation’s citizenry. To achieve economic development goals, proper management of
the following elements is necessary:

1. human resources (labor supply, education, discipline, motivation);

2. natural resources (land, minerals, fuel, climate);
3. capital formation (machine, factories, roads); and
4. technology (science, engineering, management, entrepreneurship).
The effective and efficient utilization of the various resource elements contribute
to the economic growth. This happens when the element of entrepreneurship is
performed well. The abundance of natural resources like fertile land, minerals, fuels, and
good climate are plus factors. There is a need for entrepreneurs to perform the function
of harnessing the potentials of any of any or all of the various elements, determining the
right quantity of resources needed, and applying elements at the right time.
Entrepreneurship refers to the economic activity of a person who starts, manages,
and assumes the risk of a business enterprise.
The entrepreneur identifies an economic need, considers offering a business
solution, proceeds to assemble the resources required, and assumes the risk of either
succeeding or failing. An example of these activities is properly shown on Table 1.
Entrepreneur’s Concern Problem at hand Entrepreneur’s Action
1. Identifying an economic 1. High income families 1. Establish a tourism
need are not satisfied with the destination with higher
services provided by standards than the current
tourism destination in their tourism destination is
2. Assembling resources area. providing.
required 2. Resources must be 2. Acquire funds, hire
made available people, constructing
3. Assuming risk 3. Venture must be made buildings, and the like.
3. Prepare project study,
advertise, maintain good
relationship with
 ST. ANTHONY COLLEGE Module for
CALAPAN CITY INC. Entrepreneurial Mind

employees and
customers, among others.
Table 1. An Example of Entrepreneurship Activity

The Entrepreneur’s task

If all the requirements in a capitalist economy are in place, the entrepreneur can
assume his assigned role in the development of the economy. A review of the
contributions of entrepreneurs will reveal that no business, big or small, started without
the hand of the entrepreneur. This is made possible because the surviving enterprises
are responsible for providing the following:
1. products and services for customers and producers;
2. employment;
3. taxes;
4. demand for supplier’s products and services; and
5. training facilities for future entrepreneurs.

Land Labor Capital

(Natural Resources) (Human Resources) (Financial Resources)

Entrepreneur

Entrepreneur

Entrepreneur

Figure 2. The Entrepreneur’s Task

In the attempt to make profits, the entrepreneur performs the following specific
functions:
1. to supply the necessary capital;
2. to organize production by buying and combining inputs like materials and labor;
3. to decide on the rate of output, in the light of his expectation about demand; and
4. to bear the risk inherent to the venture.

Entrepreneurship and Innovation

The freedom of competition afforded by the capitalist economy serves to drive the
entrepreneur to innovate and get ahead of his competitors lest he is driven out of the
 ST. ANTHONY COLLEGE Module for
CALAPAN CITY INC. Entrepreneurial Mind

market. Buyers of commodities have a tendency to patronize innovative offerings of any

kind and if one wants patronage, he must remember this motivation.
Innovation may be defined as the introduction of a new method, procedure,
custom, device, among others. Innovation could be any of the following;
1. new product;
2. new process of production;
3. substitution of a cheaper material in an unaltered product;
4. reorganization of production internal function, or distribution arrangement
leading to increased efficiency, better support for a given product, or lower cost; or
5. improvement in instruments or methods of doing innovation. Innovation may
also be viewed as the last stage in an important process consisting of the following:
a. Invention- which refers to the discovery of devising of new products and
processes;
b. Development- which refers to the process by which the ideas and principles
generated from the stage of invention are embodied in concrete products and techniques;
and
c. Innovation- which refers to the actual introduction of a new product or
process.
Innovation, if it must be made successful, must provide value to the buyers over
and above those offered by competitors. To achieve this, innovation must reduce costs
or improve the quality of products or services offered for sale.
Examples of successful innovations are the following:
1. cordless microphone;
2. microwave oven;
3. cellular phone;
4. kung fu fight scenes developed by Bruce Lee in the movies;
5. karaoke music appliance;
6. use of Laser in the treatment of eye conditions; and
7. use of computers by engineers and architects in the design of buildings.

New Ventures and Long-term Enterprises

A new venture cannot remain as such forever. The entrepreneur must develop it
into a small business or make it grow into a mature and bigger company if he is to recoup
the cost of opening a new venture and take advantage of the opportunities presented by
a mature business.
The transition from a new venture to a successful long-term enterprise consist of
four major stages:
1. pre-start-up stage- happens when the entrepreneur starts to question the feasibility
of an idea, product or service. He seeks answers to questions regarding potential
markets, production, and financing. This is the very important stage that the entrepreneur
must consider.
2. start-up stage- includes the activities such as formation of the business, generation of
necessary capital, purchase of facilities and equipment, constructing prototype products,
 ST. ANTHONY COLLEGE Module for
CALAPAN CITY INC. Entrepreneurial Mind

and testing market. No full scale activity must be undertaken at this stage for the simple
reason that feasibility must be established and verified.
3. early growth stage- follows after establishing feasibility. Activities will be on a small
scale. If losses occur, it will naturally be limited also. If the enterprise is successful at this
stage can be exercised.
4. late growth stage- is the final stage before the new venture matures into a stable
enterprise. This is when management is structured, long-term financing is established
and facilities planning are undertaken. This is also the stage where the skills of the
entrepreneurs are less needed. Instead the skilled manager begins to take over.

The Entrepreneur’s Predicament

In the race for winning the all-important consumer’s pesos, the business will have
to offer products or services that have certain advantages over the competition wares. In
the creation of a new venture, the entrepreneur may be successful in offering innovative
products or services. At this stage, he will reap the profits for being ahead of the
competitors. This situation may be temporary because the competitor may attempt to
improve his position by making moves to outpace the entrepreneurs in the race. The
competitor may either imitate or offer better innovations. If the competitor is successful,
the profits of the entrepreneur will decline. To be ahead again, the entrepreneur will
consider offering newer and better innovations.

Entrepreneurship and Business Size

To many people, entrepreneurship means running a small business. New business
ventures, however, can also be undertaken on a larger scale. Both small and large
business are confronted by problems that are entrepreneurial in nature. The examples of
innovations are following:
1. offering business services during Sundays and holidays;
2. manufacture and sale of new products; and
3. selling on a deferred payment scheme
Although entrepreneurship is generally regarded as a useful means of running a
small business, it is also conducive in maintaining the growth of large corporations.