Entrepreneurship and its Importance
Discuss about the Global Entrepreneurship.
Entrepreneurship reflects a process of designing, introducing and running a new business (Murimbika and Urban 2013). Generally, Entrepreneurship starts with the development of a startup company. Over the years, many entrepreneurs have able to change the entire concepts doing businesses. Entrepreneurship plays a key role in enhancing the present condition of the economy. Therefore, many countries initiate different rules and regulations in order to encourage people to become an entrepreneur. In this report, the focus will be on the entrepreneur development of Ireland. The report will focus on all the factors that can have impact on the rate of entrepreneurship. Furthermore, studies have identified that the rate of entrepreneurship has fallen significantly in Ireland. Therefore, the country is lacking behind compared to any other developed countries in the development entrepreneurship. Therefore, the report will focus on the identification of the factors that are creating adverse impact on the rate of entrepreneurship in Ireland. The report will also evaluate all the factors to highlight the best possible way to improve the rate of entrepreneurship in Ireland.
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Traditionally, Ireland is regarded as one of the popular places that utilize all the new business opportunities in the local area. Ireland has able to maintain almost 50% rate in utilizing new business opportunities in the past decades. However, the present situation has changed this perception dramatically. In the year 2012, Ireland has recorded half of the previous rate i.e., 26% in utilizing new business opportunity. Many factors have played a key role in reducing the percentage of new business development in the country. As a result, the rate of proportion of people who are at the beginning stage of entrepreneur has also to 6.1% as compared to 7.3% in the previous year (Hornsby et al. 2013). Presently the country is in the 18th spot among other OECD countries in developing entrepreneurs. The fall in the rate of entrepreneurship can be highlighted through the comparison with the rate of other countries. For instance, countries like Norway 64%, Sweden 66% and Finland 55% highlighted the significance of the problem (Diaz-Moriana and O’Gorman 2013). Therefore, it represents a huge problem for the country to handle. Since, entrepreneurs not only utilize new opportunities but also play a key role in increasing the income level of the society. Thus, fall in the rate of entrepreneurship has affected the economical condition of the country as well.
Pertinent Facts about the Country
As per the article by O’Gorman (2014), fall in the rate of entrepreneurship can actually create huge amount of negative impact on the economical development of the society. However, several factors play a key role in the decreasing rate of entrepreneurship. Therefore, Ireland also has to identify the factors that are creating adverse impact on the entrepreneurship rate.
Political Factor:
Discontinued businesses and exists is emerged as one of the major political factor that created huge impact on the rate of entrepreneurship in Ireland. Studies have identified that 1.5% of Ireland population have exited the business that was discontinued in the last year. On the other hand, only 0.5% of Ireland people have exited a business that was continued (Kuratko and Audretsch 2013). This highlighted the fact that when entrepreneurs exist a business, it eventually reflects that the business have shut down. It is also identified that lack of profitability is the prime reason for the exit of the entrepreneurs. Furthermore, global recession has also created difficulties to influence private investors to invest in the startup firms. Therefore, it induces many people to discontinue and exit the businesses.
Economic Factor:
Global recession has created huge amount of challenges for the organizations to conduct business properly. In fact, it has damages the growth of many organizations from all across the world. Several multinational organizations have closed their different business segment to cope up with the challenges of the global recession. As per the article by Fitzsimons and O’Gorman (2013), global recession also created dramatic fall in the utilization of the new business opportunities in Ireland. In fact, many cases have been found where people of Ireland have dropped the possibility of utilizing new business opportunity due to increase risk in the market. Studies have identified that only one in four people in Ireland believe that new business opportunity can be utilized successfully even in the presence of adverse impact of global recession in the market.
Social Factor:
In the present globalized world, immigrants have come up as one of the major issue. Since, immigrants have direct social, economical and political impact on the economy. Immigrants also play a critical role in the rate of entrepreneurship development. Since, high rate of immigrant’s entrepreneurship increases the competition among the startup firms. Thus, it increases the level of risk in the market places. Studies have identified that Ireland have high rate 7.2% of early stage immigrant entrepreneurs (Home – Enterprise Ireland 2016). Therefore, it created adverse impact on the rate of early stage entrepreneurship participation by the local people of Ireland.
Issues Related to Low Rate of Entrepreneurship
Technological Factor:
Increase in utilization of technology has created huge amount of challenges for the entrepreneurs. As a result, many entrepreneurs have failed in the early stage of business. Therefore, it damages the self-confidence of many people in Ireland. Many studies have identified that only four in ten people believe that they have the capability to develop a startup firm successfully. This lack of self-confidence have created huge amount of negative impact on the rate of entrepreneurship development. Furthermore, Ireland has experienced many startup businesses closed due to technological advancement in the market.
Environmental Factor:
GEM conceptual model highlighted nine framework conditions for entrepreneurship. These framework effects the institutional environment of entrepreneurship. Therefore, Ireland has to focus on the environmental perspectives at the time of developing environment effectively. For the effective maintenance of environment factor, people in Ireland have to identify new business opportunity in such a way so that it cannot able to create adverse impact on the environment. Furthermore, new business development has to consider rules and regulations implemented by government so that the startups can able to create positive impact on the environment.
Legal Factor:
Government has provided different support for the development of entrepreneurship in the country. However, recent drop in the entrepreneurship rate have suggested that the potential entrepreneurs do not getting too much support from the government. Therefore, government of Ireland will have to channel the support in such a way so that it can able to help entrepreneurs in a much more effective way. Presently, rules and regulations regarding entrepreneurship focused towards financial support. However, others factors like plan development, market information access also have to be provided by the government so that it can able to enhance the rate of entrepreneurship in Ireland.
As per the article by Bruton, Ketchen and Ireland (2013), utilization of the proper strategy is necessary for the increase in the rate of entrepreneurship. The strategies for the enhancement of the entrepreneurship rate have to consider all the factors that can create adverse impact. Otherwise, the implemented strategy might not able to fulfill the objective. Strategies for enhancing the rate of entrepreneurship are as follows:
As per the article by Holmes et al. (2014), government has to play a key role in utilizing new business opportunities for the development of the economy. Since, lack of safety has emerged as one of the prime reason for the lower rate of entrepreneurship. Government has to provide certain level of support and security so that it can induce people to utilize the new business opportunities effectively. Government can also utilize new version of loyalty scheme so that it can support new business ventures. Government can also utilize advance form of legislation on debt resolution and insolvency so that people can feel more secure at the time of investing their money in new business ventures.
Political Factor
Media also has to play a crucial role in developing entrepreneurs in Ireland. Since, proper utilization of media can actually increase the awareness of the people regarding the benefit of entrepreneurship. Furthermore, media can increase the public acceptance of a particular new business venture. On the other hand, media can also highlight some role models who have achieved immense success by becoming an entrepreneur. Therefore, it will induce people to reconsider their thoughts of not utilizing the opportunity of becoming an entrepreneur.
Education:
Ireland education system will have to provide more focus on several perspectives of becoming an entrepreneur. Particularly in higher or management education, a good foundation has to be developed so that people can able to take on the challenges of entrepreneurship. Furthermore, educational institutions also have to conduct several events regarding entrepreneurial activities so that people can face the challenges of entrepreneurship more effectively.
Increase the Rate of Women Entrepreneurship:
Studies have identified that only 4% of women have participated in early stage of entrepreneurship, as compared to 9% of men in Ireland (Kuratko, Hornsby and Hayton 2015). Therefore, it highlights the fact that women are still not focusing too much on becoming an entrepreneur. Therefore, government has to implement special benefits to induce women of the country to take on the challenges of entrepreneurship. Furthermore, effective utilization of women entrepreneurship will open up different business perspectives as well. For instance, studies have identified that 57% of women entrepreneur put prime focus on the customer service while 43% of the men put their prime focus on business services (Timothy McCarthy, O’Riordan and Griffin 2014). Thus, it will create different perspective of doing business that eventually will create positive impact on the rate of entrepreneurship in Ireland.
Conclusion:
From the above analysis, it can be evaluated that entrepreneurship is a key factor that can have huge amount of impact on the overall development of the economy. Therefore, decrease in the rate of entrepreneurship in Ireland also has created adverse impact on the development of the economy. Therefore, it is up to the government of Ireland to utilize the above mentioned strategies so that it can able to influence people to become an entrepreneurs. Furthermore, emphasize on education will help people to increase the knowledge level that eventually induce people to take more risk and utilize new business opportunities.
References:
Bruton, G.D., Ketchen, D.J. and Ireland, R.D., 2013. Entrepreneurship as a solution to poverty. Journal of Business Venturing, 28(6), pp.683-689.
Diaz-Moriana, V. and O’Gorman, C., 2013. Informal investors and the informal venture capital market in Ireland. Journal of Asian Scientific Research, 3(6), p.630.
Fitzsimons, P. and O’Gorman, C., 2013. Entrepreneurship in Ireland 2012: global entrepreneurship monitor (GEM).
Holmes Jr, R.M., Holcomb, T.R., Klein, P.G. and Ireland, R.D., 2014, January. A Judgmental Decision-Making Approach to Entrepreneurship: Toward a Behavioral Model. In Academy of Management Proceedings (Vol. 2014, No. 1, p. 15844). Academy of Management.
Hornsby, J.S., Kuratko, D.F., Holt, D.T. and Wales, W.J., 2013. Assessing a measurement of organizational preparedness for corporate entrepreneurship.Journal of Product Innovation Management, 30(5), pp.937-955.
Kuratko, D.F. and Audretsch, D.B., 2013. Clarifying the domains of corporate entrepreneurship. International Entrepreneurship and Management Journal,9(3), pp.323-335.
Kuratko, D.F., Hornsby, J.S. and Hayton, J., 2015. Corporate entrepreneurship: the innovative challenge for a new global economic reality.Small Business Economics, 45(2), pp.245-253.
Murimbika, M. and Urban, B., 2013. Strategic management practices and corporate entrepreneurship: A cluster analysis of financial and business services firms in South Africa. African Journal of Business Management,7(16), p.1522.
O’Gorman, C., 2014. . ENTREPRENEURSHIP IN IRELAND. ent in Ireland, p.407.
Smallbone, D., Virtanen, M. and Sauka, A. eds., 2016. Entrepreneurship, Innovation and Regional Development. Edward Elgar Publishing.
Timothy McCarthy, P., O’Riordan, C. and Griffin, R., 2014. The other end of entrepreneurship: a narrative study of insolvency practice in Ireland.International Journal of Entrepreneurial Behavior & Research, 20(2), pp.173-192.
www.enterprise-ireland.com, 2016. Home – Enterprise Ireland. [online] Enterprise-ireland.com. Available at: <https://www.enterprise-ireland.com> [Accessed 10 Aug. 2016].
