At first glance, the activity of an entrepreneur seems simple. However, it is not. A novice businessman needs to learn and master a lot, so that his business is more profitable, and services or goods are in demand. First of all, it is necessary to determine what determines the success of entrepreneurial activity.
Business activities
Entrepreneurship is a special type of professional activity. Its subject is the realization of the businessman’s personal potential in the process of creating a new structure that will profitably function, or expand an existing one.
The main components for the formation of the structure of this type of activity are:
- motives that are the pursuit of self-realization;
- the goals of expanding the company and benefiting from the manufacture of product activities;
- personality resources of the psychological type: performance, strategic thinking and initiative.
Having familiarized yourself with the definition of a concept, you should find out what determines the success of entrepreneurial activity.
Psychological factors
The success of this type of activity is determined by the level of assignment by the businessman of its main structural and dynamic components: resources, goals and motives.
The psychological factors of the success of entrepreneurial activity in a complex of motives represent the level of dominance of the desire for self-realization, which occurs both at the beginning of the implementation of the activity and at the stage of mastering this business.
If we consider a set of goals, we can conclude that the criterion is the desire to expand the business and get benefits from the production of goods and services.
In the resource block, psychological factors represent the level of actualization of entrepreneurial resources by the subject. These include the following personal qualities :
- initiative, which is expressed in the individual’s desire to create new forms of activity;
- working capacity, which is the businessman’s willingness to work productively in the presence of stressful cases;
- strategic thinking, which is manifested in his ability to see the future of business in uncertain situations.
Determining the success of entrepreneurial activity is one of the most important, therefore, special attention should be paid to it.
Entrepreneurship and wage labor
Entrepreneurship should be understood much more than the current conduct of business. It is important for its owner to find opportunities for creating assets that will be profitable. One of his main tasks is the correct organization of the team and the inspiration of employees for more productive work. To maintain the effectiveness of the activity, it is necessary to regularly improve and correct it.
There are differences between the work of an entrepreneur and an employee. When hired, a person always knows what he has to do. This is due to a preliminary arrangement of labor. With the functions of an entrepreneur, everything is much more complicated, since often situations arise when he has to deal with those matters that he did not initially expect. To understand why business success depends, you should find out what criteria distinguish it from other types.
Comparison of business and wage labor
For comparison, the following criteria are used:
- Labor efficiency. The mercenary works in those volumes that are controlled by his superiors. In this case, the businessman understands that the ability to create an asset will depend on the quality of his work. Therefore, he performs his functions more conscientiously.
- The need for control.
- Riskiness. The work of an entrepreneur is risky enough. This is due to the fact that its remuneration depends on the characteristics of the market and profit. Workers generally receive a fixed wage, but it also depends on the employer's profit. If the market in which it operates is stable, the risks will be minimized, which will also determine the success of the business.
- Salary. The employee will receive a pre-defined payment. The owner of the company will receive for personal consumption that which will not be included in the costs of the company. Its assets are the property of the entrepreneur. They are quite valuable, because they are able to generate income, but should not go into personal consumption.
Culture as a factor of success
Determining why business success depends, you should know that culture is quite important for her. Under this concept should be understood the degree of development of society, which is expressed in the forms and types of organization of people's lives and their relationships. When using the services and purchasing goods, the client expects their representative to observe moral standards.
It is worth noting that the success of entrepreneurship depends on moral standards. From whether there is a problem in the state with their adequacy. For example, in Russia the inviolability of private property is not fully respected. This happened historically due to the impact of the Orthodox culture and socialist policies. The existing mentality has led to the fact that most of the population does not accept the acquisition of wealth, even if it is the result of their labor. The current situation also led to a peculiar attitude to the legislation and the state as a whole.
Domestic business is distinguished by the fact that its ethics or its absence is largely determined neither by personal choice, nor by law. First of all, it depends on the need for the survival of the entrepreneur in conditions of non-compliance with laws, uncertainty and oppression by the state. What determines the success of entrepreneurial activity, and what should be the ethics that contribute to it? It includes such basic norms:
- respect for the inviolability of private property ;
- manifestation of personal initiative;
- fulfillment of obligations, lack of attempts to cause harm and honesty;
- absolute compliance with the terms of contracts with partners;
- independent decision making;
- responsibility for their actions;
- high-quality performance of work;
- taking part in partnerships of a social type;
- ensuring proper health and employment;
- elimination of discrimination during the implementation of activities;
- observance of openness of information to society.
Having considered only these norms, it is difficult to understand what the success of entrepreneurial activity depends on, so it is worth continuing to study the material on this topic.
Key Success Factors
It is worth considering the main factors affecting the success of business. In the days of classical capitalism, there was only one main factor, which was capital. At the same time, capitalists acquired inventions and ideas, and managers were also hired. With the development of science and technology, an increase in the manufacturability of products was made. For this, the entrepreneur had to join forces with managers, developers, innovators who have modern ways of marketing products, organizing production and management.
Considering the main features of entrepreneurial activity, we can distinguish the following equal factors: capital, innovation and management. It is worth noting that today the manager, owner of capital and innovator have the same opportunities in entrepreneurship. At the same time, any of them can initiate the creation of a project or start their own business, inviting two other partners.
Capital
Capital is not only cash. They can be a huge number of various intellectual and material goods that will become investments for the provision of services and the manufacture of goods. When capital is combined with management and innovation, the human and natural resources that form labor are combined.
The considered factors of successful entrepreneurial activity can also involve methods for saving resources and time in labor, which helps to increase the productivity of the use of natural resources and labor. With the help of experience and knowledge, it is possible to significantly reduce the amount of required investment and speed up the solution of production problems.
Innovation
Innovation is a product of the creative process. They imply the transformation of scientific and engineering ideas when creating experiments in production and technical solutions. This product of thinking should be distinguished by originality and novelty. You should also consider the availability of production capabilities for the implementation of the project.
To find out what determines the success of entrepreneurial activity, you need to understand what benefits and demand innovations can have. That they were worthwhile, it is necessary to follow the rules of their development and implementation. First of all, an idea is created or borrowed and transformed into a solution of an engineering-technical type. Next, an assessment is made of their usefulness to consumers, as well as the efficiency and adaptability of the manufacturing process. If the creation of the project is continued, an experimental batch is made. After the release of products in full volume and its implementation on the market, approaches are developed to create purchasing power.
You can achieve success in implementing entrepreneurial activity by mastering the science of innovation management, which has existed and improved over the past few years. For this, a businessman needs to ensure an increase in the scale of production, development and updating of goods, as well as an extension of their life cycle.
Regular innovation and product updates will lead to the long-term and efficient existence of the company. Determining what determines the success of entrepreneurial activity, one should take into account the need to conduct an assessment of the need for changes, as well as to timely identify the time of updating. This is due to the ability to search for effective alternatives in relation to the technologies used, which will lead to product improvement and increased demand for it. Reducing the cycle of creating innovation is the main task of the enterprise, which determines its competitiveness and success.
Management
One of the factors that affects the success of business is management. Its essence lies in the creation of purposefully working groups of unorganized people. Management allows you to use the abilities of subjects to implement the ideas posed by the company, due to their joint work. The manager has a task, which is to bring the company to the goal with the proper functioning and processes.
In order to achieve the success of the enterprise, it is necessary to adhere to the following management principles:
- unity of directions;
- division of labor and responsibility;
- unity of all general disciplines;
- compliance with the previously agreed order;
- fair reward;
- sociability and collectivity.
To make entrepreneurial decisions and their implementation, the following management tools are required: leadership, motivation, coordination, control and coordination. The greatest emphasis is on collectivity and personality, as well as determining the powers of managers and performers. The effectiveness of management decisions allows to achieve positive results in the conduct of activities.
Output
Based on the material under consideration, the success of an entrepreneurial activity depends on many factors. Conducting research on its criteria allows us to take a fresh look at this problem. Modern training materials designed to train future entrepreneurs have few differences from manager training programs. For this reason, the study of the functions of management and innovation is essential. With the right approach to the study of materials, you can understand how to achieve success in carrying out entrepreneurial activities.
Having examined the information presented, you can understand what personal qualities a businessman should possess. Factors affecting the optimal functioning of the company are essential. Each business owner must consider them in order to achieve the desired results. This information is especially important for aspiring entrepreneurs.
It is also worth noting that the success of business depends on the reliability of the market in which it is carried out.