Ethical and Legal Considerations
in Entrepreneurship
As an entrepreneur, navigating the complex
landscape of ethics and legality is crucial.
As an entrepreneur, navigating the complex
landscape of ethics and legality is crucial. Lets
delves into some key aspects :
Stakeholders and Shareholders
Shareholders are a small group of owners or stockholders in a
business.
Stakeholders, on the other hand, encompass a larger group that
includes everyone with a vested interest in the business—
employees, customers, suppliers, the community, and more.
• Ethical Entrepreneurship:
• Being ethical means aligning actions with moral
principles. As an entrepreneur, ethical behavior
involves:
• Awareness: Understanding the impact of decisions on various stakeholders.
• Responsibility: Balancing profit motives with social and environmental
concerns.
• Integrity: Upholding honesty, transparency, and fairness in business
practices.
Legal Issues:
Legal compliance is essential for entrepreneurs. Key areas include:
Contracts: Understanding and fulfilling contractual obligations.
Intellectual Property: Protecting patents, trademarks, and copyrights
Employment Law: Complying with labor regulations.
Legal Issues:
Consumer Protection: Ensuring fair practices and product safety.
Taxation: Meeting tax requirements.
Ignoring legal obligations can lead to severe consequences for the
business.
FUNDAMENTAL OF PRODUCT
DEVELOPMENT
Before commercializing a new product or service, the entrepreneur must focus
first on refining the product or service and validate its market acceptability.
This new product does not have to be totally new product. It can be a new
product line from the existing business of the entrepreneur, a product
extension, an enhancement or a repositioning of an existing product.
Product development
is the process of developing, testing and commercializing a product
or services with the ultimate objective of solving the problem of the
primary target market. It composed of four sequential steps: 1.
developing a product or service description, 2. creating a prototype,
3. testing the prototype and 4. validating the market.
Product and service description
simply describe a product or service works and how it
benefits the customer. A clear product or service
description is important this will serve as the blueprint
of all business operation.
Therefore, the entrepreneur has to take note the
following regarding the product or service description.
1. It should directly address the primary target market in a
personal manner using every day language. The
entrepreneur should put himself or herself in the customer’s
shoes where the product description will be addressed to.
Therefore, the entrepreneur has to take note the
following regarding the product or service description.
2. It should highlight the features that will cater to the customer’s
need or address the customer’s product.
3. Realistic superlatives should be used for the product description.
Motherhood statements such as world class service or product
excellence may not matter to the customers at all.
Creating prototype of the product or service
Prototype – is a preliminary model or sample of a new product or services
that is created to test a product or concept or service process. This is an
exciting process for the entrepreneur because he or she will be able to see
that his or her ideas will soon become tangible reality. The entrepreneur’s
creativity and ingenuity will be used in creating prototype.
Testing Prototype
Testing Prototype – is a vital process before an actual product or service is
launched to the market. Testing the prototype will uncover the final
loopholes that need to be fixed before commercialization. It gives the
entrepreneur a leeway to examine and scrutinize the prototype and provide
feedback as to what can be improved before the launch.
The following testing methods are applied by
the entrepreneur:
1. Focus group discussion
- the participants will provide relevant insights
about the new product or services. The objective of the FGD
is to identify errors, deficiencies and issues that may impede
the success of the product. Participants also need to provide
suggestions and practical solutions on how to improve there
deficiencies.
The following testing methods are applied by
the entrepreneur:
2. Legality and ethical test
- prior to launching , the entrepreneur must ensure
that the product or service complies with all relevant laws and
regulations and has a necessary license or permit to operate a
particular business.
The following testing methods are applied by
the entrepreneur:
3. Safety Test
-the entrepreneur must ensure the product is safe to use, safe consumed (food
and beverages) and safe to be applied (cosmetic product). The product should not in
any way harm the customer or put the customer in peculiar situation. In services, the
entrepreneur must ensure that the processes performed by the service provider must not
be detrimental to the safety and health of the customer.
The following testing methods are applied by
the entrepreneur:
4. Product costing Test
-the entrepreneur must examine every stage of the manufacturing process or
every process of the service blueprint to evaluate and finalize the cost involved. This
is the time when the entrepreneur can match the expected cost versus his or her
budget. Modification in the manufacturing process or service blueprint can still be
made at this point to align with cost objective of the entrepreneur.
The following testing methods are applied by
the entrepreneur:
5. Component Test
- each component of the product or service must be tested
independently to identify component failures for goods or services
failures for services. Any failure identified must be redesigned and
tested again until it becomes fully operational and functional.
The following testing methods are applied by
the entrepreneur:
6. Competitors product / service test
The entrepreneur must test a similar line of products or the
competitors product or service itself to compare and get the
practices to be applied to the new product or services.
MARKETING AND BRANDING
Now as a future entrepreneur, how do you describe the sales of your
product being displayed on the shelves of various malls and groceries
beside the product with a brand name? Do you think the customers will
notice or remember it? Branding will ultimately reside in the mind of
every consumers, thus it play a significant role in every business.
Branding
is a name, symbol or other feature that distinguishes a
seller’s good or services in the marketplace. Your
brand is one of your greatest assets because you brand
is your customers over-all experience of your business.
Brand Strategy
is a long term design for the development of a popular brand in order to achieve the
goals and objectives.
A well-defined strategy shakes all parts of a business and is directly linked to customer
needs, wants ,emotions and competitive surroundings.
Expert believe that a good brand can result in better loyalty for its customer, a better
corporate image and more relevant identity.
COMMONLY USED IN BRANDING
STRATEGIES
1. Purpose
Every brand makes a promise. But in a market in which
customer confidence and budgetary observance is great, its not
just making a promise that separates brand from another, but
having a significant purpose.
How can you define your business purpose? According to
business strategy Insider, purpose can be viewed into two ways:
a. Functional
- this way focuses on the assessment of success in terms of fast and
profitable reasons. For example, the purpose of the business is to make
money.
b. Intentional
- this way focuses on fulfillment as it relates to the capability to
generate money and do well in the world.
2. CONSISTENCY
The significance of consistency is to avoid things
that don’t relate to or improve your brand.
Consistency aids to brand recognition, which fuels
customer loyalty.
3. Emotion
There should be an emotional voice, whispering “ Buy Me”. This
means you allow the customers to have the chance to feel that they are part of
your brand.
You should find ways to connect more deeply and emotionally with you
customer. Make them feel part of the family and use emotion to build
relationship and promote brand loyalty.
4. Flexibility
Marketers should remain flexible too in this rapidly
changing world. Consistency targets at setting the
standard for you brand, flexibility allows you to adjust
and differentiate your approach from your competition.
5. Employee Involvement
It is equally important for your employees to be
well versed in how they communicate with
customers and represent the brand of your
product.
6. Loyalty
Loyalty is an important part of brand strategy. At the end of
the day, the emphasis on positive relationship between you
and your existing customers sets the tone for what potential
customers can expect from doing business with you.
8. Competitive awareness
Do not be frightened of competition. Take it as a challenge
to improve your branding strategy and craft a better value
in your brand.
