Defining an Entrepreneur
In our society today, many individuals consider an entrepreneur as someone who creates their own business from scratch. However, a true entrepreneur means so much more. Through the articles of Hebert and Link, Sarasvathy and Gartner, it is found that an entrepreneur can have several different definitions, and everyone seems to have their own opinions on it. It is also interesting that the definition of an entrepreneur is still in debate today. Comparing the articles of these four authors, we are able to find some common ground on what defines an entrepreneur.
Herbert and Link’s Definition
Herbert and Link identify twelve themes to define an entrepreneur, and also explain that these theories are both static and dynamic. However, they state that,
“Only dynamic theories of entrepreneurship have any significant operational meaning” (Hébert, R. F., & Link, A. N., 1989, p. 41).
This quote shows that Hebert and Link primarily categorize their definitions of entrepreneurship as being a dynamic discussion. A summary of the twelve points by Hebert and Link’s theories is explained in their quote,
“The entrepreneur is the person who assumes the risk associated with uncertainty, The entrepreneur is the person who supplies financial capital, The entrepreneur is an innovator, The entrepreneur is a decision maker, The entrepreneur is an industrial leader, The entrepreneur is a manager or superintendent, The entrepreneur is an organizer and coordinator of economic resources, The entrepreneur is the owner of an enterprise, The entrepreneur is an employer of factors of production, The entrepreneur is a contractor, The entrepreneur is an arbitrageur, The entrepreneur is an allocator of resources among alternative uses” (Hébert, R. F., & Link, A. N. ,1989, p. 41).
These twelve theories show readers that it is the actions of an entrepreneur, not necessarily their individual character traits or personality traits that make them stand out from other business owners.
Throughout the article, Herbert and Link included other authors to support their definitions of an entrepreneur, however, each of them added in their own personal points of view on entrepreneurship to develop a deeper understanding and definition of the term. One thing each of these authors agree on is that when entrepreneurs come across uncertainty the way they act upon uncertainty is different than a average businessperson. It is stated in the article,
“Schumpeter’s theory, the dynamic entrepreneur is the person who innovates, who makes ‘new combinations’ in production” (Hébert, R. F., & Link, A. N., 1989, p. 44).
This quote is from one of the authors Hebert and Link used to support their theories and basically means the process of being flexible enough to make changes during production is the key to standing out in business. Overall, Hebert and Link, along with their supporters, define an entrepreneur as someone who is willing to take risks, faces uncertainty and then uses it as an opportunity to revise their business model.
As I was reading Hebert and Link’s article, I found myself creating my own definition of an entrepreneur. I believe that an entrepreneur is someone who listens to other individuals’ opinion on the world and what's important to them, turns negative situations into opportunities that will benefit their business, are creative in their business offerings and generally risk takers. My definition is a little different than Hebert and Link’s, but I do like their twelve theories and agree with most of them.
Sarasvathy’s Definition
Sarasvathy uses effectual reasoning to define an entrepreneur. Sarasvathy (2006, p. 2) describes effectual reasoning as an individual who allows their goals to change over time based on the actions of the individuals they connect with, which makes an effect on their business decisions. She also states,
“effectual thinkers are like explorers setting out on a voyages into uncharted waters” (Sarasvathy, 2006, p. 2).
This idea of effectual reasoning explains that the entrepreneur starts with something small and based on what they hear from the world around them, they will then build upon that feedback in order to achieve success. Sarasvathy (2006, p. 4) uses the example of an individual wanting to start a restaurant. The business started out delivering lunches to a few office colleagues in hopes of attracting them as regular customers who order lunch daily. Having regular customers who order meals on delivery will hopefully turn them into customers who want to take it further and come in to eat at her restaurant. However, as Sarasvathy reveals, the customers actually enjoy her personality more than her food, so she might have to change her business model or hire a new chef. The effects of what the customers want versus what the business produces causes uncertainty for the entrepreneur, so they need to have the willingness to change in order to be a true entrepreneur as defined by Sarasvathy.
Furthermore, in Sarasvathy’s article (Sarasvathy, 2006, p.6) she uses the “Ready-fire-aim" analogy and how turning the unexpected into profits is another aspect of effectual reasoning. Entrepreneurs do not spend a lot of time perfecting their business model before putting it out in the market because they do not want to miss any opportunities. Although it might bring difficulties, the entrepreneur will turn whatever comes their way into a positive outcome. In the end, entrepreneurs do not try to predict the future to succeed, they understand and work with individuals around them to find a way to earn profits in their business and change along the way to fit their customer's needs. I agree with this aspect of an entrepreneur most because one key element of someone who is an entrepreneur, is someone who has the flexibility to change with society’s needs, and when they do this, they seem to be more successful.
Gartner’s Definition
Gartner uses the behavioral trait approach to define entrepreneurship and what type of person acts most like an entrepreneur. It is stated that,
“In the trait approach the entrepreneur is assumed to be a particular personality type, a fixed state of existence, a describable species that one might find a picture of in a field guide, and the point of much entrepreneurship research has been to enumerate a set of characteristics describing this entity known as the entrepreneur” (Gartner, 1988, p. 12).
This quote shows Gartner's theory of how an entrepreneur is classified based on their personality and characteristic traits. However, throughout the article, Gartner expresses that any individual could develop these traits and does not need to be born with them. In the end, Gartner states that,
“The entrepreneur is not a fixed state of existence, rather entrepreneurship is a role that individuals undertake to create organizations” (Gartner, 1988, p. 28).
Creating a business takes an individual with personality traits of someone who can persevere through failures and turn them into opportunities. Gartner shows us that an entrepreneur can be anyone who puts their mind and effort into it.
Throughout reading Gartner’s article, I began to realize that any individual could become an entrepreneur. As long as an individual is willing to set aside their personal opinions and adapt to what society wants, then they can become an entrepreneur. I agree with Gartner, that anyone can become an entrepreneur, because through perseverance and acceptance of feedback, anyone can become successful.
Conclusion
To conclude, although there are different perspectives on what defines an entrepreneur and what traits are required to be an entrepreneur, I believe it all boils down to someone who is willing to put themselves at risk for a business opportunity. For the easiest definition, in my opinion, entrepreneurs are individuals who can persevere through failures and difficulties, and then turn each situation into something that will help their business succeed. I think that each author did a great job in expressing their points of view. I agree with all of their opinions because I feel like they all make great points and combined the definition of entrepreneurship is best explained. However, I can also see why there is still some debate about what the best definition is because it takes all kinds of people to make businesses successful.
Works Cited
Gartner, W. B. (1988). “Who is an entrepreneur?” is the wrong question. American journal of small business, 12(4), 11-32.
Hébert, R. F., & Link, A. N. (1989). In search of the meaning of entrepreneurship. Small business economics, 1(1), 39-49.
Sarasvathy, S. D. (2006). What makes entrepreneurs entrepreneurial?
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