What makes an ‘entrepreneur’ an entrepreneur?

Business How To’s

21 February 2019

What makes an ‘entrepreneur’ an entrepreneur?

  • Posted by Awfis Editorial

Your neighbour’s kid, instead of taking on a 9-5 job, decides to open a restaurant. Would you say that is enterprising? Yes, it is. It takes courage to get off the expected, beaten path and do something different.

Does that make him an entrepreneur though? Umm, not so sure of that. There is a lot more that goes into making an entrepreneur an entrepreneur.

Is the idea or business likely to revolutionise the industry or marketplace? Your neighbour’s kid again, if the restaurant had a theme, like ‘cook with the chef’ or an idea that took it beyond food as we all know it, then perhaps he could qualify as an entrepreneur.

Yes, it can be confusing. Let’s understand this a bit more.

Meaning: what’s in a word?

The dictionary defines the word entrepreneur as ‘a person who sets up a business or businesses, taking on financial risks in the hope of profit.’ So, shouldn’t that mean every businessperson is an entrepreneur, since all people start business to make profit, and they take on financial risks?

Apparently not.

An entrepreneur is often seen, and rightly so, as an innovator – one who comes up with new ideas and new business processes. A strong set of management skills and team building abilities are a must-have to become a successful entrepreneur.

As is with many things in the English language, turns out the word ‘Entrepreneur’ is also not an original. This has been borrowed from the 18th century French word ‘Entreprende’, which meant ‘to undertake’. An interesting twist to this is, the word was mainly used to describe a ‘manager or promoter of a theatrical production’. And that’s not too far from the performance of a successful entrepreneur, now, is it?

As the world, and its languages, evolved, so did the word. Through the years, the word ‘entrepreneur’ has seen plenty of changes in its meaning, particularly in relation to business and commerce.

History: how did the term originate?

Much credit goes to Richard Cantillon, an Irishman living in France, who first used the word ‘Entrepreneur’ in his book ‘Essai sur la Nature du Commerce au General (Essay on the Nature of Commerce)’, published in 1755. He uses the term ‘entrepreneur’ to describe anyone who bought or manufactured goods at a certain cost to sell them at an unknown price. It was Cantillon’s usage that established an entrepreneur as a ‘risk-taker’.

This was just the beginning. Soon after, Jean Baptiste Say, a French economist, described an ‘Entrepreneur’ as an ‘adventurer’ or ‘one who undertakes an enterprise, especially a contractor, acting as intermediary between capital and labour’. He even went on to define the entrepreneur as someone who ‘shifts economic resources out of an area of lower and into an area of higher productivity and greater yield.’

It was in 1934 that Joseph Schumpeter, an Austrian American political scientist and economist, gave us a more modern definition of an entrepreneur as ‘the person who destroys the existing economic order by introducing new products and services, by creating new forms of organization, or by exploiting new raw materials.’

And finally it took US business consultant, Peter Drucker, to espouse that an ‘entrepreneur’ should only be that person who creates something new, something different. According to him, an entrepreneur ‘always searches for change, responds to it, and exploits it as an opportunity’.

There you have it, the modern day definition of what started as a manager of a theatrical production.

Rise of the Intrapreneur

Today the word ‘entrepreneur’ is no longer limited really. It is rapidly evolving and starting to mean so many different things for so many different people. In fact, entrepreneurship has gone on to include social entrepreneurship into its for-profit-only folds. Here, companies seek to fulfil social, environment and even humanitarian obligations alongside business goals.

Unlike what you might have been led to believe, entrepreneurship is not just the domain of start-ups. As a trait and a business model, it can be found within an existing firm or large organization as well. Intrapreneurship, as it is called, is when an organisation sets aside substantial funds and even has dedicated talent that focuses on special ideas or projects. These teams are instructed to treat the project like an entrepreneur would, and successful ideas are many times ‘spun-off’ as subsidiary organizations.

Intrapreneurs have all the resources and capital of the firm at their disposal and the environment to think like entrepreneurs, without the typical risks that come with the territory.

Conclusion

Do not confuse the term ‘entrepreneur’ with a ‘small business’ or even used it interchangeably. While it is a fact that most entrepreneurial ventures start out as small businesses, the converse is not strictly true – not all small businesses have an entrepreneurial streak. Many consist only of the owner, or a few employees at best, and most of them might offer an existing product or service. They do not aim at growth or are not looking to change the market.

Entrepreneurial ventures, on the other hand, offer an innovative product or service, and the entrepreneur has plans to scale up by adding employees, looking at international markets, etc. This is made possible through venture capital and angel investments. Successful entrepreneurs must have the ability to steer a business in the right direction through planning, by adapting to changing environments and by building on their own strengths and weakness.

Are you aware of these top trends affecting HR today?

Business How To’s

27 May 2019

Are you aware of these top trends affecting HR today?

  • Posted by Awfis Editorial

In a world that’s focused more on disruption, innovation and ideas, it is sometimes natural to ignore the ideas and trends that are affecting HR departments. After all, it is the folks in the HR department who hire the people who go on to come up with all those disruptive ideas, right?

Let’s take a moment to find out what are the top trends, in no particular order, in HR today.

#1 It’s a job seeker’s market
Hiring is on the rise and certain skill sets in all industries are hot right now. But there are challenges too. Every industry has some problematic jobs, those that are constantly in need of the right employees – in hospitals it’s good doctors, software engineers in IT, and line engineers in utility services.

With no immediate solution to this shortage of talent, it becomes all the more critical for employers to retain their talent by focusing on workforce development. This works two ways – existing employees do not go looking for a change, and potential employees look at the company as a way to better their careers.

#2 Paid time off is precious
It is important to offer paid time off to employees, especially parental leave and sick leave. Many companies globally, including Adobe, Netflix and Nestle, and closer home, Infosys and TCS have made news with their much-needed paid paternal leave policies.

While many companies have these leaves in place, not many employees take them simply because they are not aware of them. Transparency and clear communication with regards to leaves is critical in making more employees aware of their rights.

#3 Wellness and self-funded healthcare plans
Many employers are going out of their way to offer economical health benefits to their employees without compromising on quality. Some of these include wellness programs, onsite health centers and even self-funded health plans. When an employer focuses on employee wellness, it not only makes them feel cared for but also happier. By bringing healthcare into the organisation, employers are helping reduce the cost of healthcare that employees would need to receive.

#4 Goodbye annual raise; hello variable yearly bonus
One trend that is sweeping HR is the drop in yearly fixed salary raise and an increase in variable bonuses. Employees too seem to prefer a yearly bonus – they feel that gives them ‘greater control’ as it is often a reflection of their performance. The shift away from annual raises is also representative of a more holistic approach that companies have taken towards compensation and benefits. Companies that offer a strong healthcare program or have an amazing workplace culture can afford to pay slightly lower salaries. Eventually it is all about what employees want.

#5 The end of annual reviews
Many employees seem to be opting for regular feedback rather than an annual one. This is in part because of app-enabled technology and millennials too. Most next generation employees believe that an annual review system is cumbersome and doesn’t really have a benefit, neither for the employee nor the employer. With everything in their lives immediate and tech-enabled, an annual review is dying a fast death indeed.

It is interesting to note that companies like GE are swapping their ancient, analog systems for supple, mobile-enabled programs. But there’s a challenge – any performance review should continue to remain objective and minimize bias, which means collecting more data and not less.

#6 Managing multiple generations is more important than ever
Let’s accept that millennials are now the majority in any organisation, but that does not mean sidestepping Gen X and Baby Boomers. If anything, employers need to ask themselves how they can make all generations work together while moving forward.

The good news is that the needs of the millennials and Gen X are not too different. Both need instant access to information, so it might make sense to move beyond emails and start using mobile apps and other newer messaging tools. Interestingly, the Baby Boomers generation too is quite open to adopting these new pieces of tech.

Millennials might tend to be more idealistic, but they and Baby Boomers want the same things – an opportunity to work hard and to make the world better. Keep communication lines open and tell all employees that learning is a two-way street.

#7 Gamification of HR
Most HR policies sound great but implementing many of them is quite cumbersome, to tell the truth. HR tech accessibility is the biggest grouse, with some of it for employers only, leaving employee, the real beneficiaries, out of the loop.

More and more HR teams are starting to release the benefits of implementing technology that will help everyone within the organisation.

Accessible apps and gamification of HR is gaining momentum. Apps that can be accessed via computers at work and even the mobile phone are becoming increasingly popular. Corporate learning is one such aspect that has benefited greatly. Quizzes, social media contests and friendly competition can encourage daily interactions too.

Conclusion
Innovation and disruption seems to be a natural expectation of marketing, sales, production, design and other traditional creative departments. However, as people evolve and gravitate towards these newer ways of working, it is imperative that the HR departments play catch up and find innovative and disruptive ways to engage and retain the talent in their organisations.

Business incubators: giving startups a new lease at life

Business How To’s

23 April 2019

Business incubators: giving startups a new lease at life

  • Posted by Awfis Editorial

We’ve all heard of the term incubator. It’s mostly in the context of a science lab where a controlled environment helps create the ideal conditions for the growth of microorganisms (the good ones). Or you might have heard about it around hospitals and babies – an apparatus where premature or ill babies are looked after until they are well enough to face the world.

The premise of a business incubator is not much different, and it draws from both these scenarios. For an entrepreneur a new business is like a baby, needing round-the-clock attention and care. And it also needs the right environment that can help it grow and flourish.

So, is that all there is to it? Let’s find out a little bit more.

Meaning: what’s in a word?

The corporate world describes a business incubator as a facility that is established to nurture fledgling businesses during their young or early years. It offers all the support services and builds the right environment needed by the yet young and fragile business to grow before it can take on the world as a serious entity.

Do not mistake a business incubator as a business assistance program or service. An incubator’s role is that and so much more. But before we get into it, let’s step back a bit and see how the concept came into origin.

History: how did the term originate?

The formal inception of business incubation started in the USA way back in 1959. Massey-Fergusson, the largest industrial center in Batavia, shut down in 1956 and left behind an 850,000 square foot complex of multi-storied buildings which was purchased by the Mancuso family. Instead of splitting it into many units and renting it out to several businesses, as many would have done, Joseph L. Mancuso decided to offer shared office services, but took it a few steps beyond by including assistance with raising capital and also offering business advice. And that’s how Batavia Industrial Centre became the world’s first business incubator. Over the years it has helped thousands of businesses find their feet in the corporate landscape.

The idea took off in the 1980s and soon spread to the UK and Europe, emerging on the other side of the Atlantic Ocean as innovation centres, pépinières d’entreprises, science parks, etc.

Business Incubator: Not business assistance

We’ve already mentioned above that a business incubator is not like a typical business assistance program. For starters, a business incubator does not cater to the needs of any and every company. Entrepreneurs looking to be part of a business incubation program have to apply for admission. The criteria for acceptance vary from program to program, and company to company. However, in general, only those startups which have feasible business ideas and a workable business plan are admitted.

Yes, most business incubators offer office space and shared administrative services to clients. But the core of a true business incubation program is the services it provides to startups. Many incubation programs serve affiliate or virtual clients which do not occupy the incubator facility. These could be home-based businesses or companies in their early days that work out of their own premises but can benefit from incubator services. Virtual clients could be those that are too remote from an incubation facility but can receive counselling and other assistance electronically.

Startup companies often turn to an incubation service to overcome the hurdles of lack of resources, experience and networks. Some of the most common incubator services include:

  • Help with business basics and marketing
  • Networking activities including access to strategic partners and investors
  • Market Research
  • Accounting/financial management
  • Assistance with bank loans, loan funds and guarantee programs
  • Help with presentation skills and business etiquette
  • Links to higher education resources
  • Comprehensive business training programs and mentoring
  • Technology assistance
  • Help with regulatory compliance
  • Intellectual property management

Present Day Scenario

Today there are about 7,000 incubators worldwide, with a large chunk of them spread across the US and Europe. While government entities, such as cities or counties, take up 21%, around 33% of these are sponsored by economic development organizations,. And then there are academic institutions, including two- and four-year colleges, universities and technical colleges, which account for another 20%.

Business incubation isn’t limited to just developed nations; incubation environments are being created in developing countries and organizations such as UNIDO and the World Bank are offering financial assistance. Several countries also run incubation programs that are funded by their regional or national governments as part of their overall economic development strategy.

Conclusion

Business incubation isn’t a program that is limited to assisting individual businesses. It is a means of meeting a range of economic and socioeconomic policy needs of a nation, including but not limited to job creation, fostering an entrepreneurial climate, building or accelerating growth of local industries, diversifying local economies, business creation and retention, identifying potential business opportunities and community revitalization.

How long a company spends in an incubation program depends on a number of factors, including the type of business and the entrepreneur’s business expertise. Businesses with long research and development cycles take much longer than say, a manufacturing or service companies which can produce and bring a product or service to market quickly. On average, incubator clients spend close to 33 months in the program. Several incubation programs rely on development benchmarks, like company revenues or staffing levels, instead of time.

Instagram Trends of 2019: stay ahead of the game

Business How To’s

14 March 2019

Instagram Trends of 2019: stay ahead of the game

  • Posted by Awfis Editorial

March 13th was a black day for many of us who spend nearly all our waking hours on Instagram and Facebook. A technical glitch created a major outage and a sort of existential crisis for millions (yes, you read that right) of users. Just how large a following Instagram has was amply evident during this digital apocalypse.

If your brand has still not tapped into the possibilities of Instagram, it’s not too late yet. Move over Facebook and other social media platforms; Instagram is well on its way to becoming the ultimate marketing tool for brands looking to build a strong digital presence. Month on month, this photo and video sharing platform is leapfrogging its way into boardrooms and marketing meetings.

And quite rightly so. It offers a slew of exceptional advantages that make all the difference between a brand being #1 or #2. Throughout last year, the app made upgrades and modifications to its interface, and completely spoiled us with all the fun stuff.

Wonder what everyone’s favourite app has in store this year. We did a little snooping and this is what we believe users and brands can look forward to.

Going further with Augmented Reality

Augmented Reality (AR) is set to be one of the biggest Instagram trends of 2019. If you thought this is some futuristic stuff, you’d be surprised to know that you have already interacted with it through Instagram Stories. Those cute face filters, such as the puppy dog ears and nose? Those are actually AR filters. Who knew, right? Simply put, AR is superimposing virtual effects (computer generated images and videos) onto the real world through the camera.

There are over 400 million people using Instagram Stories daily! And that, dear brands, is a fantastic opportunity for you to jump on to the face filter bandwagon. Create your own custom AR filters for your customers to use using Facebook’s Spark AR Studio.

And how does this benefit you? In order for your customers to use the filters, they need to follow you on Instagram or at least visit your brand profile. Once they do that, it’s all up to you to keep them engaged. AR filters have all the makings of going viral. Question is how soon you are going to cash in.

Everybody likes a good story

Instagram might have started out as a place to post pretty pictures of food and cats, but it is a serious business tool today. With the numerous features it offers, it’s a space to engage with customers and to build a community of fans.

If you’ve been following Instagram’s progress, you’ll see how Stories has slowly and steadily grown in popularity over the last few years. Many users are now actively posting on Stories rather than their classic feed, which has become more secondary. To put it in digital parlance, the main feed is more like their home page – strategic, planned, etc. – where people can stop by to see what’s happening. However, Stories is more natural and shows their quirky, ‘human’ side.

Instagram’s been quick to catch up on this trend and most of its recent updates have been around Stories: polls, questions, emoji reactions, stickers, countdown, music, focus mode … the list goes on. This means brands will now find easier and better ways to communicate with their audience, taking customer engagement to a whole new level. You can use Story stickers to give some measure of involvement to customers during product decisions. Track their feedback, and tweak and change your offering until it satisfies the majority.

Shopping @Instagram

Today, nearly 62% of smartphone users are making purchases via their mobile devices on the go. If you are an ecommerce brand, Instagram is your gateway to more sales. With nifty features like shopping and product tagging, monetising your presence on Instagram has never been easier.

Whether it’s loyal followers who want to purchase your products or potential ones who discover you on Instagram, this platform is now a bona fide sales channel that you can no longer afford to ignore.

Its built-in shopping reminder – the tiny shopping bag icon that appears in the lower-left corner of your posts – is a quiet trigger of shopping opportunities.

Using Instagram product tagging allows you to capture more mobile users who are always on the go, and shopping while they do it. And as more customers realise just how easy and fun it is, the tribe of Instagram shoppers is only going to grow.

All that they need to do is click on your shoppable posts via the ‘Shop’ button that is conveniently located directly below your highlights/bio. Serious shoppers can browse through all your shoppable posts, making it really easy for you to appeal to their inner shopaholic.

Nearly 46% of people say they avoid purchasing from a brand if it means a disconnected mobile experience. Instagram product tagging takes care of that seamlessly. It sends your customers directly to your product pages – sitting snug within the Instagram app itself.

Get real with influencers

The influencer marketing industry is expected to touch $5-10 billion by 2020. And this has been largely due to Instagram. And even though most brands are gung-ho about influencer marketing, the regular folks are starting to see through the thin veneer of perfect Instagram posts, overly edited photographs and sponsored content.

Influencers are getting real now. They have come to realise that in order to retain their followers and also their brand deals, they will need to get more personal and authentic this year. You will see more influencers being open about their sponsored content, even explaining to their followers how much of their income comes from sponsored posts.

This will mean more genuine experiences for customers and far more deeper, meaningful and authentic relationships.

The trend sort of kicked off in 2018 itself, which saw the rise of a new kind of Instagram influencer focused on authenticity. The example of body positive Jenna Kutcher is perfect. She went from 166k to 700k+ followers in just a year, that too without paying for a single follower.

Watch out for IGTV

When IGTV was launched in June 2018, it was a bit of a damp squib. Which was quite surprising, as the vertical video format is easier to work with while creating content, and for users as well to watch on their phone. However, the good guys always win in the end. It was closer to the end of the year when some of the bigger brands and influencers started dabbling in IGTV. 2019, we believe, will see vertical video come into its own. More brands and public figures will publish long-form content and more users will start to check IGTV. Be ready for the shift, and start working on creating vertical videos soon.

Conclusion

Instagram has always been a visual medium. ‘Show, don’t tell’, has been the mantra all along. And now with its many new features and upgrades, Instagram will help you turn your feed into a fun and easy selling machine too.