Dynamics Of Entrepreneurial Development And Management

Utilization of entrepreneurship and innovation in the organization

Discuss about the Dynamics of Entrepreneurial Development and Management.

There exists a conceptual relationship between entrepreneurship and innovation. The concept combines several kinds of capabilities, knowledge, resources and skills. As a result, the establishment of business structures and strategies has been possible because of the embrasure of contextual factors. Apparently, the heart of entrepreneurship is innovation. Therefore, it is through innovation that entrepreneurs’ progress and further succeed in their business practices. The concept of corporate entrepreneurship refers to coming up new ways of carrying out business (Coulter, 2008). The work of entrepreneurs is to seek for opportunities and further guide the innovation to achieve success. To run a business, it is imperative for one to coordinate factors of production fully which includes land, labor, natural resources and capital which provide excellent business opportunities for entrepreneurs.

Essentially, the consideration of innovation by the BHP Billiton is quite fundamental for changing and positively perfecting on the operation management practices (Holt, 2011). Simply, the technology breakthrough that is a result of creativity entrepreneurship and innovation has sharpened the competitive edge of various institutions. In this regard, this report has explicitly discussed the relevance of innovation and entrepreneurship, in enhancing growth, as well as perfecting in the management of internal and external business environment by BHP Billiton.

Entrepreneurship is described as the ability of an individual to enter into a business venture with the aim of making a profit (Basotia, 2011).  One is required to be a risk taker because of the high risks associated with starting a new business. The categories of risks that an entrepreneur may be exposed to are stated as follows; the global risk, political risk, market risk, business risk and societal risk. In this context, the entrepreneurial skills acquired through learning and sometimes inborn will play a significant role in the development of operational strategies and management of resources. It is a fact that someone with entrepreneurial knowledge if given management duties, is in position take the risk, possess appropriate leadership skills, is flexible, adaptable to change, good at networking, vibrant in decision making and more (Sharma et al., 2010). The employment of such workers by BHP Billiton will support and enhance proper planning, technological use and lead the company in increasing on its portfolio. As a result, BHP Billiton will expand further to more than the 20 current areas it operates.

The term is described as the capability of coming up with new inventions. Some of these designs in the business context include; new ideas, products, services and better solutions to a current problem in the business industry. BHP Billiton can benefit from two types of innovation; product and process (Zimmerer, et al., 2009).  Product innovation involves changing the attributes of goods and services so as to make a difference in customer perception. Process innovation is making a shift in production to help reduce costs and increase profits. Importantly, innovation is gained through the employment of talented individuals and provision of a Conducive innovative environment in the organization. Also, it can develop through exposing the employees to further training programs. Sincerely, enacting strategies that can enhance creativity will inevitably assist BHP Billiton to realize both short term and long term objectives (Mauzy et al., 2003).

Entrepreneurship theories that can enhance the incorporation of technology, diversification, and division of labor

Entrepreneurship and innovation are key components needed for the better performance of business functions. They will assist BHP Billiton to identify the strengths, weaknesses, opportunities and threats and take active measures to ensure everything is put right (Badi et al., 2010). For instance, they will be critical when changing the business model, their aspects, coming up with new enterprises and procedures of carrying the business to incline the processes to business purposes. The increased level of competition and poor performance of the traditional management practices calls for innovations and entrepreneurial skills. 

Therefore, to enhance the functions of a firm (operational, finance, human resource and funding functions) the employees will rely on innovation and entrepreneurial skills to be risk takers and highly innovative to bring to the organization new ideas that never existed before (Desai, 2009). Entrepreneurship and innovation will strategically be used by BHP Billiton managers in business practices to help outdo competitors as well as creating more wealth. A manager can pose competition between departments to exploit the talents possessed by their juniors (Burns, 2009).  Also, facilitating communication among all people can help in sharing ideas and consequently new inventions can be realized.

As earlier noted, the use entrepreneurship theories can, however, enhance the incorporation of technology, diversification, a division of labor, and others. Some of the notable ideas include:

Economic Theories; According to this theory, workers at BHP Billiton will apply their entrepreneurial skills and innovation to evaluate the existing market condition. As a result, they will identify available business opportunities and assist in designing new products that are unique from those of competitors.

Resource-Based Theories; it focuses on the various resources that are available to the entrepreneurs. They the capital required, the data provided on social networks and the human resources. When these resources are exploited appropriately, the chances business success will be high (Sudha, 2008).

Psychological Theories; it is all about the individual’s emotional elements. The company will encourage positive individual actions and personality traits that can influence the environment in carry out their daily activities.

Opportunity-Based Theory; by use of this approach the workers will look at the technological, social and cultural changes and then identify business opportunities that will assist the company to succeed in the exploitation of mineral resources with Australia and other parts of the world (Simonton, 2003).

In this section, internal contextual factors are local factors that have a direct impact on the ability of BHP Billiton to achieve its goals and objectives are discussed. They include:

Domestic contextual factors affecting BHP Billiton’s goals and objectives

The Australian industry; there exist stiff competitions between companies that are in the same business industry of mineral extraction.  However, for BHP Billiton to continue providing high-quality products, it is essential to hire employees with entrepreneurial minds and highly innovative (Cropley, 2001).  Failure to adequately address this issue can negatively affect the business structure and strategy and further methods of production.

Market factor; the customers and potential users of the products and services influence the buying patterns and marketing strategies of business practices. Most organizations look at the market performance before making any decisions. To avoid being affected by market changes, the management of BHP Billiton should encourage the marketing team to identify the consumer needs and preferences to help come up with appropriate structure to follow and this can be through financing market research (Roy, 2009).

Human resource factors; BHP Billiton need to structure their human resource department to ensure that they hire qualified and skilled personnel. The staff will help in the development of entrepreneurship and bring innovations that enhance the company performance (Simonton, 2003). If it fails to hire qualified and further develop them, the company may lose the competitive edge and innovation will no longer achieve. Consequently, the chances of failing to hit targets will be high.

The level of government support; lack of support of business enterprises negatively affects the company in various ways. For instance, it sometimes suffers financial problems due to inability to get cheap loans from the Australian government. The government should, therefore, financially boost the local companies because such enterprises have significantly contributed to the generation of wealth to the state (Sternberg, 2000). 

In this part I examined international factors that have direct and indirect impact on the organizations administrative structures and operational management. They are discussed as follows:  

The legislation; the rules and regulations by different government’s concerning how businesses operate affect the firms’ structures and strategies. Unfavorable changes in these policies will negatively affect BHP Billiton making it a requisite to restructure its management structures as well as formulation of strategies to cope with the changes (Roy, 2009).

Social cultural factors; they include individuals attributes like age, values, beliefs, education and religion. The culture of people has been changing from time to time and thus, there is need for BHP Billiton to restructure and formulate new strategies to incline business values with peoples’ cultural imperatives (Hisrich & Peters, 2011). Therefore, it is wise for management to fully understand the culture of people surrounding the business entity to win their support and consequently the goodwill.

Economic conditions; inflation and changes in demand are the most popular economic conditions that impact the strategies and structure of firms. For the perfection of business practices, it should prepare to handle those factors that can be controlled. For instance, BHP Billiton should just prepare employees to understand phenomenon like inflation to avoid demand of salary increase due to rising prices of goods and services (Desai, 2009).

Technology factor; currently, there is rapid advancement in technology. Business practices are now done on the web and therefore BHP Billiton should restructure its processes and structures to help cope with the technological changes and always incorporate the new developments (Buttner, 2009). It is apparent that most sellers in the international markets have embraced the current technology in doing everything. BHP Billiton therefore, has to ensure it remains at par with innovation to compete favorably.

Conclusion

To sum up, entrepreneurship and innovation is a fundamental contextual factor that influences the structure and strategy of the organization. The managers should ensure that they focus on new methods of running their activities. All the above can be achieved through proper utilization of the factor and understand the technological trends to give room for innovations. Most importantly, the technology should be incorporated in BHP Billiton process and hire qualified and experienced individuals to oversee the operations.

However, the report strongly recommends that domestic challenges should be used to prepare the management in handling the international problems.  With the fact that local firms are directly affected by the foreign companies, it should be a learning point and employ the same strategies that enhance the success of these foreign companies. In addition, research and development programs should be financed by the organization. It will help the business to comprehend and adopt foreign customs resulted from changes in the domestic norms of business practices. The international exchange of skills and knowledge leads to new product designs and manufacturing methods. Thirdly, the company should employ experts to help understand regulations imposed by the foreign government concerning business practices that do affect the structures and strategies. As a result, new ideas of entrepreneurship are recognized that facilitate utilization of human resources accordingly.

References

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Burns,  P. (2009). Entrepreneurship and Small Business: Palgrave Macmillan, China.

Buttner,  E.  H.  (2009). Examining Female Entrepreneurs: Management Style. An Application of a Relational Frame: Journal of Business Ethics, 29(3), 253–269

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Mauzy, J., and Richard A. H. (2003).  Creativity Inc.: Building an Inventive Organization. Harvard Business School Press,  

Roy, R. (2009). Entrepreneurship: Oxford University Press, New Delhi.

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