THIRD EDITION. Theory in Practice OXFORD UNIVERSITY PRESS SOUTHERN AFRICA
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1 THIRD EDITION Theory in Practice OXFORD UNIVERSITY PRESS SOUTHERN AFRICA
2 Contents Acknowledgements Dedication Preface PARTI Pre start-up phase: opportunity recognition and e Introduction 1.2 Entrepreneurship as a field of study 1.3 Conceptualising entrepreneurship 1.4 Different domains of entrepreneurship 1.5 Entrepreneurship distinguished from other management forms Entrepreneurship versus conventional management Entrepreneurship versus small business management 1.6 A brief history of entrepreneurship Origins of entrepreneurship The Renaissance and Industrial Revolution periods Modern-era entrepreneurship Entrepreneurship in African societies 1.7 The entrepreneurial process 1.8 Typologies and differential impacts of entrepreneurs High growth versus replicative entrepreneurship Necessity versus opportunity-based entrepreneurship Local versus systemic entrepreneurship 1.9 A framework to explain the entrepreneurial process Gase scenario and exercise Chapter key terms and core concepts Chapter summary Chapter review questions Application questions Relevant chapter Websites References : 2.1 Introduction The individual as a first-order force Entrepreneurial intentions Ajzen's Theory of Planned Behaviour (TPB) Shapero's Model of the Entrepreneurial Event 2.4 Entrepreneurial mindset and cognitions ;
3 Entrepreneurship: Theory in Practice 2.5 Entrepreneur's background and human capital variables Background and characteristics Human capital variables Entrepreneurial capital Entrepreneurial intelligence and creativity Intelligence Creativity Creativity techniques Entrepreneurial motivation and behaviour 'Big Five' key dimensions of entrepreneurial behaviour 68 Gase scenario and exercise 74 Chapter key terms and core concepts 75 Chapter summary 75 Chapter review questions 76 Application questions 76 Relevant chapter Websites 76 References 77 <«a social contsxt Introduction Social capital conceptualised Networks as a form of social capital Network diversity Networking ties Network relations and trust Networks and spatial distance Entrepreneurial heritage Institutional legacy Family background Culture as a form of social capital Cultural values ' Cultural values and entrepreneurial activity African entrepreneurial culture 105 Case scenario and exercise 107 Chapter key terms and core concepts 108 Chapter summary 109 Chapter review questions 109 Application questions 110 Relevant chapter Websites 110 References Introduction Importance of the environment 121
4 4.3 Factors and their impact on entrepreneurship Technological factors Economic factors Regulatory, political and legal factors Socio-cultural factors Sustainability factors Global and international factors Key entrepreneurship indicators The Global Competitiveness Index Ease of doing business indicators Global Entrepreneurship Monitor (GEM) indicators 138 Gase scenario and exercise 143 Chapter key terms and core concepts 144 Chapter summary 144 Chapter review questions 145 Application questions 146 Relevant chapter Websites 146 References 146 ÜHlMil ErareprwMurial apportu texus between the 5.1 Introduction Opportunity and change Entrepreneurs and opportunities Signal detection theory (SDT) Regulatory focus theory (RFT) Opportunity identification as a process Opportunity recognition and development processes Factors influencing the core process Exploiting opportunities for value Opportunities that favour established firms Opportunities that favour new firms Opportunities and risk-taking Risk perception and cognitive biases Integrative framework development 170 Gase scenario and exercise 172 Chapter key terms and core concepts 173 Chapter summary 173 Chapter review questions 174 Application questions 174 Relevant chapter Websites 174 References 174 vii
5 Entrepreneurship: Theory in Practice T Introduction The nature of business plans Controversies around business plans Business plan structure and components Business plans for different types of ventures The business model canvas Benefits and limitations of business plans Fatal flaws to avoid when business planning Business plan presentation 198 Gase scenario and exercise 199 Chapter key terms and concepts 200 Chapter summary 200 Chapter review questions 201 Application questions 201 Relevant chapter Websites 202 References Introduction The sole proprietorship The partnership The partnership agreement Rights and duties of the partners Dissolution of the partnership Advantages and disadvantages of the partnership The Company Types of companies Incorporation of companies Close corporations Small businesses and the Act Company names Directors' duties and liabilities Business rescue Regulatory agencies Winding-up and liquidation Advantages and disadvantages of the Company The franchise Types of franchises Advantages and disadvantages of franchising Is franchising entrepreneurial? 232 viii
6 7.6 The co-operative Defining co-operatives Types of co-operatives Legal characteristics of co-operatives Advantages of co-operatives 239 Gase scenario and exercise 241 Chapter key terms and core concepts 242 Chapter summary 243 Chapter review questions 243 Application questions 244 Relevant chapter Websites 244 References 244 irmtrailrtii'llfllm brgader con,.«u.l issues Introduction The National Development Plan Promotion of entrepreneurship and SMMEs Broad-based black economic empowerment policy Industrial development policy National strategy for the development and promotion of franchising Strategie framework on gender and women's economic empowerment National youth enterprise strategy Co-operatives policy Competition policy Trade policy Fiscal policy Monetary policy Labour policy Intellectual property policy Education policy Bankruptcy policy 276 Case scenario and exercise 276 Chapter key terms and core concepts 279 Chapter summary 279 Chapter review questions 281 Application questions 281 Relevant chapter Websites 283 References 283 ' Introduction Own money 288 ix
7 Entrepreneurship: Theory in Practice 9.3 Other people's money Debt financing Equity finance Shareholder capital Venture capital Angel Investors Crowdfunding as an alternative - beyond traditional debt and equity 325 Case scenario and exercise 327 Key terms and core concepts 332 Chapter summary 332 Chapter review questions 333 Application questions 333 Relevant chapter Websites 334 References 334 fihhhhmkymhiemfc MßfoprsAourship Introduction Defining strategy and the Strategie management process The Strategie management process Components of the Strategie planning process Initial assessment - creating vision and mission statements Strategie analysis Strategy formulation Strategy Implementation Strategy monitoring and control The concept of Strategie entrepreneurship The concept of Blue Ocean strategy The growing field of business modelling in entrepreneurship 367 Case scenario and exercise 368 Chapter key terms and core concepts 370 Chapter summary 371 Chapter review questions 372 Application questions 372 Relevant chapter Websites 372 References 373 Wä rthfcll IS3U8S Introduction The relevance of ethics to the study and practice of entrepreneurship What is ethics? Morality and ethics Ethical absolutism versus relativism Ethical dilemmas 382 x
8 11.4 Approaches to ethics Teleological ethics Deontological ethics Social morality and justice Other ethical approaches Moral judgement and ethical decision-making Moral judgement Ethical decision-making Ethics, the law and compliance Ethics and the law Compliance Legality, legitimacy and the informal economy Corporate social responsibility and entrepreneurship Guidelines for ethical behaviour 414 Gase scenario and exercise 415 Key terms and core concepts 418 Chapter summary 419 Chapter review questions 420 Application questions 420 Relevant chapter Websites 421 References 421 PART 3 Post start-up phase: sustainability and growth P & 12.1 Introduction What is technopreneurship? Understanding technology Defining technology Types and forms of technologies The technological adoption life cycle The technopreneurship ecosytem What is e-commerce? The Internet The Internet and e-commerce Forms of e-commerce Flanning the e-commerce initiative How e-commerce works Guidelines to making the Implementation of e-commerce effective The benefits of e-commerce for the entrepreneur in South Africa E-commerce policy in South Africa 459 Gase scenario and exercise 462 Chapter key terms and core concepts xi
9 Entrepreneurship: Theory in Practice Chapter summary 465 Chapter review questions 466 Application questions 466 Relevant chapter Websites 467 References 467 HK Introduction Why family businesses? What is a family business? The roles and perspectives of major participants in the family business The owner-manager or founder The owner-manager's spouse Husband and wife teams (copreneurs) Children (siblings) and sibling rivalry In-laws Multi-family ownership and partners Non-family employees Differences between family and non-family business enterprises Unique characteristics of family businesses Managing succession in family businesses Pre-planning analysis Succession planning Managing the founder's departure ('letting go') Ensuring transgenerational success and entrepreneurial thinking in a family Governance practices that enable a family business to function effectively 500 Gase scenario and exercise 504 Chapter key terms and core concepts 505 Chapter summary 505 Chapter review questions 506 Application question 507 Relevant chapter Websites 507 References Introduction Defining corporate entrepreneurship Entrepreneurial orientation (EO) Dimensions of corporate entrepreneurship Innovativeness Risk-taking Proactiveness 516 xii
10 Competitive aggressiveness Autonomy Types of corporate entrepreneurship Corporate venturing Intrapreneuring Organisational transformation Industry rule-bending Similarities in the four types Corporate entrepreneurial culture and climate Organisational climate Establishing a corporate entrepreneurial climate Characteristics of a corporate entrepreneurial climate A framework for corporate entrepreneurship - from theory to application An overview of the integrated framework From theory to practice 535 Case scenario and exercise 536 Chapter key terms and core concepts 539 Chapter summary 540 Chapter review questions 541 Application questions 542 Relevant chapter Websites 542 References 542 CHAPTER 15 Social entrepreneurship Introduction What is social entrepreneurship? Why social entrepreneurship? Characteristics of social entrepreneurs The process of social entrepreneurship Social context The mission The social opportunity Action Impact (evaluation and scaling out) Ecopreneurship 584 Case scenario and exercise 586 Chapter key terms and core concepts 588 Chapter summary 588 Chapter review questions 589 Application questions 589 Relevant chapter Websites 590 References 590 xiii
11 Entrepreneurship: Theory in Practice 16.1 Introduction Defining international entrepreneurship Theories of internationalisation The Uppsala Internationalisation Process Model Vernon's International Product Life Cycle (IPLC) Theory Dunning's Eclectic Paradigm The Population Ecology Theory Resource Based Theory Network approach to internationalisation Foreign Direct Investment approaches (FDI) Drivers of internationalisation Requirements for internationalisation Modes of internationalisation Exporting Importing Strategie alliances Licensing International franchising Foreign direct Investment 627 Gase scenario and exercise 629 Key terms and core concepts 631 Chapter summary 632 Chapter review questions 633 Application questions 633 Relevant chapter Websites 633 References 634 Index xiv
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