Enterpreneurship free essay sample

The primary objective of this report is to analyze entrepreneurs regarding their skills, traits and cultural background. This report will provide information on how entrepreneurs came up with their business ideas for their start-ups and pay attention to their ability to turn the ideas into successful business ventures. The two entrepreneurs chosen for this report are Steven Sim from Malaysia and Fred Smith from United States. Dato’ Steven Sim established the famous Secret Recipe cafe and turned it into one of the most successful homegrown franchises in Malaysia. Whilst Fred Smith is the founder, chairman, president, and CEO of Federal Express (FedEx), the first overnight express delivery company in the world, and the largest in the world. 2. 0 Description 2. 1 Dato’ Steven Sim – Secret Recipe It was 15 years ago that Dato’ Steven Sim thought of opening a bakery cafe when he saw the cafe culture was progressively creeping into the lifestyle in some of the Asian countries. The name of â€Å"Secret Recipe† came to him in a dream one day. Together with his four nephews who are all bakers, he created the Secret Recipe brand in the form of its first outlet in SS2, Petaling Jaya. With start-up capital of RM150,000, the cafe had less than 10 types of cake and only five dishes on the menu. Despite the Asian financial crisis in the same year, they were determined to see success through their commitment to offer something different and exciting for their customers. Today, Secret Recipe has successfully been developed as an international lifestyle cafe chain and their business was expanded to overseas (Audit, 2011). 2. 2 Fred Smith – FedEx Fred Smith wrote his initial idea of forming a reliable overnight delivery service in a computerized information age on his economics term paper but it was less than impressed and commented as unfeasible. Undaunted by the Yale professor who had argued that few people would pay a premium for overnight delivery, Smith identified the tremendous difficulty in getting packages and other airfreight delivered within one to two days. Upon Smith’s discharge from the military, he returned to his initial idea that has almost single-handedly changed the way business is conducted. Smith took a controlling interest in an aircraft maintenance company, cobbled together some venture capital funds with his inheritance and successfully launched Federal Express Corp. in 1973 (Entrepreneur, 2009). 3. 0 Analysis The important role of entrepreneurial activity for the conversion of technological and organizational innovation into new and more efficient products and services is well known. However, more than 50% of new ventures terminate within 5 years; thus, it is important to understand the factors that drive new venture success (Baum and Edwin, 2004, p. 587). 3. 1 Skills Entrepreneurial skills are important because the concept of this skill implies the ability to innovate, motivate, be opportunist, be risk bearing, pursue in personality development, to be active in socializing within society and it is a long life learning process. It is critical for an entrepreneur to be able to build great relationships with his team, customers, suppliers, shareholders as well as investors in order to be successful (Mindtools. com, n. d. ). Both of Steven Sim and Fred Smith have the critical and creative thinking skills in common. Dato’ Steven Sim is able to see situations from a variety of perspectives and come up with original ideas. He realizes of the potential ability of adapting cafe culture in Asian countries and take the opportunity to come up with the ideas of bringing in this kind of lifestyle firstly in Malaysia. On the other hand, Fred Smith can also identify the tremendous difficulty in getting packages and other airfreight delivered within one to two days and thus he tried to create a plan to take advantage of the opportunities that he recognized in his university terms paper. Moreover, Dato’ Steven Sim is known for his good general knowledge in marketing skills. He was once involved as one of the marketing geniuses behind a very successful multinational hairstyling academy. He left his job as a marketing director where he was earning a five-figure monthly income after spotting a business trend in the food and beverage industry (Huong, 2011). With his solid experience and skills in marketing, he has been focusing on building a brand more than a cafe. Sim kept strong about his product differentiation concept and successfully built a sustainable global business with a strong well-known brand eventually. As for Fred Smith who is an undergraduate, he possesses a charisma of practical skills. Being well-equipped of knowledge in the air-freight industry, Fred Smith already displayed his entrepreneurial talents early in life. He learned to fly when he was 15 years old and took up crop dusting as a part-time hobby. He clearly understands the market that he is attempting to enter for ensuring the ability to operate and manage his business ideas with a reasonable degree of competence. 3. 2 Traits – Big Five Personality Model In the psychological literature on entrepreneurship, entrepreneurs are often described as individuals with certain kinds of stable and enduring characteristics or features. These traits presumably originate from early childhood and persist through their lifetime (Work Culture and Developing Agri-Entrepreneurial Skills among Farmers, 2011, p. 491). The big five personality traits are the best accepted and most commonly used model of personality in academic psychology. 3. 2. 1 Extraversion Extraversion simply means the tendency to experience positive emotions and moods and feel good about oneself and the rest of the world (Jones and George, 2003). Being a successful marketer, Dato’ Steven Sim was naturally much more extraverted, sociable and affectionate. He is always assertive with his concept of international brand building and keeps actively exploring to the overseas market by franchising (Family. my, 2012). Fred Smith’s idea at first was convinced to be unfeasible. However, he never had a negative outlook yet be determined to make it work. In the time-honored style of the true innovative visionary, Smith listened to his own counsel, he starts from naive and single-handedly turned the way up the world does business (Entrepreneur, 2009). 3. 2. 2 Negative affectivity Negative affectivity implies the tendency to experience negative emotions and moods, feel distressed and be critical of one and others (Jones and George, 2003). Dato’ Steven Sim and Fred Smith are both low in negative affectivity entrepreneurs. Both of them do not tend to experience many negative emotions and are less pessimistic even if they met a problem. For example, when Secret Recipe is trying to expand their outlets to Singapore in 1998, their biggest hurdle was to secure a location on the popular Orchard Road because they weren’t a well-known international brand so it was hard to be accepted. However, Dato’ Steven Sim was tenacious and determined enough to break through the difficulty by successfully developing their first Singapore outlet in a neighborhood location and soon opened up more branches in the high-traffic shopping centers (Foo, 2012). Similarly, although FedEx had lost nearly $13. 4 million in its first two years, Smith never considered giving up. Instead of feeling depressed, he was committed and took a leading role in lobbying for air cargo deregulation that finally came in 1977 and these changes allowed FedEx to use larger aircraft, spurred the companys rapid growth. It soon became the premier carrier of high-priority goods in the marketplace and the standard setter for the industry it established (About FedEx, n. d. ). 3. 2. 3 Agreeableness Agreeableness means a person is good natured, co-operative and trusting. It is a tendency to get along well with others (Jones and George, 2003). Dato’ Steven Sim was always talking and working along with the research and development team in close cooperation to come up with new flavors and dishes for our customers who always want something different. Moreover, he has also extended his product range to cater to the more health conscious customers who still want their cake too. This fully shows that Dato’ Steven is a likable individual with high agreeableness who cares about others (Foo, 2012). As for Fred Smith, he emphasizes treating its workers fairly. Managers are carefully trained to foster respect for all employees, and their performance is monitored. In FedEx, managers are evaluated annually by both bosses and workers to ensure good relations between all levels of the company. Fred Smith is highly agreeable and believes that fair treatment instills company loyalty, and company loyalty always pays off (Entrepreneur, 2009). 3. 2. 4 Conscientiousness Conscientiousness expresses that a person is responsible, orderly and dependable which would be a tendency to be careful, scrupulous and preserving (Jones and George, 2003). Dato’ Sim will always do the market studies related to the lifestyle, cultural in the country before entering a new venture in the country. This is to ensure that the product can be accepted by the local community. Products are customized with their local taste then. Accordingly, being high in conscientiousness, Dato’ Steven is self-disciplined and manage to organize a business decision wisely every time. Likewise, Fred Smith, whose charisma and the knowledge he gleaned from several years of studying the air-freight industry (both in the military in Vietnam and later in the United States) definitely made him a high in conscientiousness entrepreneur as well. He sagely organized and expanded the connectivity and efficiency of its global network through aircraft fleets upgrade and numerous acquisitions with step by step, lead FedEx become the largest revolutionary worldwide carriage service corporation nowadays (About FedEx, n. d. ). 3. 2. 5 Openness to Experience Openness to experience indicates the tendency of a person to be imaginative; with original, broad interests and independent minded as well as be daring to take risks and having divergent thinking (Jones and George, 2003). Dato’ Steven Sim is a typical representative of a wide openness entrepreneur. He had much focused on Secret Recipe brand building to make it truly unique and distinctive compared with his competitors. He took the risk of introducing the brand-new concept of cafe in a casual atmosphere with customizing his products with the local taste to firstly open up the cafe lifestyle ideas in Malaysia. Mainly due to rapidly rising fuel costs and sparse package volume, FedEx continued to run in desperate financial trouble at the earlier stage. As an entrepreneur who was able to stand the gaff, Fred Smith, with his highly openness took the remaining money and flew to Las Vegas and won $27,000 at the blackjack table which had kept them alive from the crisis (Storyteller, 2013). 3. 3 Culture – Hofstede Cultural Dimension Theory The entrepreneurial work culture is the composite of personal values, managerial skills, experiences and behaviors that characterize the entrepreneur in terms of one’s spirit of initiative, risk propensity, innovative capacity and ability to manage a firm in relation to the economic environment (Ey. com, n. d. ). 3. 3. 1 Uncertainty Avoidance Based on the Hofstede Cultural Dimension Theory, the dimension of Uncertainty Avoidance has to do with the way that a society deals with the extent to which the members of a culture feel threatened by ambiguous or unknown situations and have created beliefs and institutions that try to avoid these (Geert-hofstede. com, n. d. ). However, Dato’ Steven and Fred Smith both have the same culture of willingness to take risks at the heart of their business concept. They see the business opportunity in perspective and strive to achieve it passionately. Even if the culture of cafe was not well-received at the early stage in Malaysia, Dato’ Steven still try to bring in this cafe lifestyle and promoted his cafe by walking with giving flyers with free coffee to people who visited his cafe. He then took the chance to understand customer satisfaction and asked for customers’ comments to know people preferences. Early business failures are viewed as providing vital experience for future successes. Although FedEx had lost most of his fortune in the early days, Fred Smith never considered giving up. He was once saved his company from survival at a critical time with his persistence and courage to have a bet on the blackjack table. 3. 3. 2 Individualism The dimension of Individualism addresses the degree of interdependence a society maintains among its members (Geert-hofstede. com, n. d. ). Being a collectivistic society with low degree of individualism, Malaysia fosters strong relationships, where everyone takes responsibility for fellow members of their group. For example, Dato’ Steven created a management system which is responsible for examining the quality of the products in every branch and also employee training to ensure that achievement of specified level of quality. 3. 3. 3 Power Distance Power distance is defined as the extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally (Geert-hofstede. com, n. d. ). Nevertheless, the fairly low degree of power distance in FedEx has shown the typical American behavioral patterns. This can be explained by the American premise of â€Å"liberty and justice for all. † This is evidenced by an explicit emphasis on equal rights in all aspects of employees by Fred Smith. Within American organizations as FedEx, hierarchy is established for convenience, superiors are accessible and managers rely on individual employees and teams for their expertise. Both managers and employees expect to be consulted and information is shared frequently whilst the communication is informal, direct and participative to a degree (SUCCESS, n. d. ). 4. 0 Conclusion From the analysis of these two entrepreneurs in this report, I have learnt that there is a different business culture from each of the country. However, almost every entrepreneur might have the same personality and each of their distinguishing features can have important impacts to their business decision. In conclusion, a successful entrepreneur must preserve essential distinctions along his behavioral, functional and occupational dimensions.