CURRENT ISSUES IN ENTERPRENEUSHIP NOTES

Business Ethics

Ethics: this is a set of moral principal that govern the action of an
individual or group
The principal should play a significant role in guiding the conduct
of manager’s entrepreneurs and employees in the operation of the business.
Business ethics is concerned the right and wrong in the practice of
entrepreneur ( business)
It addresses both the body of principals governing business practice
with emphasis on the product the consumers and the entrepreneur’s moral
concepts.

Sources of Moral Principles

Doctrines: primarily religion & politics that have there over years
since the beginning of the history e.g

the mosaic ten commandments
Athenian principle of democracy
The British concept of individual justice
The bill of rights of UK.

Value and norms
Values and norms of a given society are related to religious tendencies,
customs and traditions that vary from society to society.

Code and standards
Codes and standards formulated by a particular professional groups and
business organizations. The entrepreneur needs to be critical in all his
dealings i.e conduct and his dealings with others should be within
acceptable business limits as established
by business principals, manners and values.

Important Aspects of Business Ethics

Competition
Competition is regarded as healthy and fair when carried on within
acceptable business limits as established by business principals,
manners and values.

Unfair competitive aspects

Reduction of prices of goods and services to very low levels with
the object of putting competitors out of business.
Explaining the ignorance or the consumers as on quality and quantity.
Grouping together with a view of lowering the prices in order to
push other out of business.
Bribing – in order to get business contracts prevents fair competition.
Gaining control over the supply of any commodity in order to create
an artificial scarcity.

Pricing
An entrepreneur it is necessary to give fair prices of goods and services
Over pricing is likely to put customers away while under pricing might
not be good for competitors.
Customer/Supply relations
Ethical business owners treat customers and suppliers with fairness and
consideration. Honestly and courtesy is required in dealing with
customers e.g Preferential treatment.
Goods & service
The products and services offered by customers must meet the quality and
quantity requirements
Employee treatment
Employees should be treated ethnically e.g

Working for reasonable number of hours
Pleasant working conditions
Listen to their complaints and give satisfactory answers
No discrimination

Product promotions
The entrepreneurs should make sure that all promotional activities are
ethnically presented i.e No mis- representation
Packaging of the right products, Fair promotional method which confirm
to good morals.

7.2 Aspects of Management Ethics

Organization ethics e.g code of ethics
Organization ethics refer to the moral principals or policies set by the
organization with guide behaviour in the organization with guide
behaviour in the organization which guide behaviour in the organization
referred to as code of ethics. The code of ethics should guide the
behaviour of all persons in an organization referred to as the code of
ethics. The code of ethics should guide the behaviour of all persons in
an organization and it’s effectiveness include.

starting the code
Appointing ethics committee.
Holding regular updates on the codes
The entrepreneur should maintain good codes of conduct in order to
enable him deal with.
legal issues
government regulations
social pressures

Individual ethics

Involve personal attributes such as honesty avoiding criminal Acts,
willingness to perform e.t.c. The individual ethics
n influenced by determined by religious political and family backgrounds. Together with the standards of organization one is working in.

Social ethics
Involve ethical issues which relate to;

Environmental awareness
Public relations
Fair competitions

Government obligations
Involves ethical practices to statutory laws and regulation such as

Payment of taxes
Making annual returns e.g NHIF, NSSF
Insurance e.t.c

7.3 Role of an Organization (entrepreneurs) to Stakeholders

Stakeholders include the society, employees and the government.

The role of the business enterprise to society

To provide employment
Conservation of the environment
Develop social amenities e.g schools

Role of the society to the organization

A source of labour
Raw materials to the organization
Market for the products and services
Capital to invest in the business.

Organization role to employees

Good compensation ( wages and salaries)
Good working conditions
Training programmes
Recreation facilities

Role of employees to organization

Creativity and innovation
Time management
Working to set goals
Following rates and regulations
Respecting other co-working and management.
Working to set goals
Following roles / instructions
Roles of organization
Job creation
Infrastructure
Tax
Foreign exchange through exports

Tools of Ethics

Ethical language
The key terms of ethical language are values, rights, duties and roles.
Values are permanent desires that seem to be good in themselves e.g
peace. Values are answers to answers to questions of why? E.g why should
managers behave ethically?

Rights

It’s a claim that entails a person to do something. While a duty is
an obligation to take responsibility e.g to pay tax.

How Companies/ Organizations improve their Ethical Standards

Having codes of conduct
Forming ethical committees
Social audience/ judicial courts
Enhancing control measures i.e rewarding, punishment. This will
motivate people to work
Training ethics to people
Using role models.

Discipline

The term discipline simply means that members of a group confirm to
the rules and regulations framed by an organization
Discipline is the orderly conduct of affairs by the members of an
organization who adheres to its regulations because they desire to
corporate harmoniously in forwarding the end which the group has in
view, and willingly recognized that, to do this, either wishes must
be bought into a reasonable union with the requirements of the group
in action.

Note;

Discipline means ordering i.e the opposite of confusion.
Discipline does not merely mean a strict and technical observance of
rigid, inflexible rules and regulations
Discipline simply means working co-operatively and behaving in an
orderly and normal way as responsible person would expect and
employee to do.
Discipline is the training that corrects mould strengthens or perfects
Discipline is the control gained by enforcing obedience.
Discipline requires punishment.

Code of Ethics
The term ethics refers to a general idea or belief t hat influences
people’s behaviour and attitude. A code of ethics refers to a set of
laid down moral rules or principles which govern behaviour on deciding
on what is right and what is wrong, Ethics from the foundation of the
people of an organization as they make decisions or internally and with
other stakeholders

The basis of ethical standards
Three main elements from a basis of ethical standards

The law
Law defines for society as a whole, which actions are permissible and
which are not. The law establishes the minimum standards of behavuiour.
Actions that are legal may not necessary be ethical

Policies and procedures of the company.
N/B Research suggests that merely a half of an organization have a
written code of ethics. These serve as specific guidelines for people as
decisions are made.

Morale stance
This is the stance or the position of an individual taken when faced
with a dilemma may not be governed by moral rules. Such behaviour is
influenced by the values individuals learn from childhood schools and
family and church.

Training
A major determinant of ethical behaviour is training. Note” you get a
good adult by getting the right child and teaching him right things.
Ethical principles that guide behaviour

honesty; which refers to being truthful, sincere, forthright forward
and frank
integrity – that is being principled, honorable, upright and courageous
act with convictions
do not be two faced
do not adopt an “ End justifies means philosophy
Promise keeping; being worth of trusting, keep promises, fulfill
commitments and abide by the spirit as well as the intent or aim of an
agreement.
fidelity- being faithful and loyal to family, friends, employees and
the country, being confidential

Safeguard the ability to make independent professional judgment by
avoiding undue influence of conflict.

Establishing Ethical Standards in an Organization
although there are no single standards for ethical behaviour managers
must encourage employees to be familiar with various tasks for judging
behaviour using;

utilitarian principle
this refers to choosing the option that offers the greatest number of people

Kant ‘s categorized imperative
Act such that the action taken under the circumstances could be a
universal rule of behaviour

The professional ethics
Take only those actions that a disinterested panel of professional
colleagues would view as proper

Golden rule
Refers to treating other people the way you’d like them treat you.

The television rule
Would you and colleagues fell confortable explaining your actions to a
national T.V audience.

The family rule
Would you feel comfortable explaining to your children your spouse or
your parent why you took a certain action?

Ways of maintaining respectful conduct by office employees

Respect seniors by adhering to their requirements in terms of duty,
social life.
Respect of colleagues – recognize other employees and respect then
to create a friendly working environment
Respect your work simply because it sustains you and do what is
expected of you.
Respect visitors so as to get a positive image of the organization,
treat them with a lot of respect.
Respect customers and clients.

Situations of sexual harassment and discrimination

indecent dressing is a common cause and it is be that both men and
women dress in a way not provocative to others in terms of thought
and feelings
sexual favour- this can be in form of seniors asking for sexual
favouor so that they can give promotion transfers e.t.c or Junior
staff offering such to get promotions and transfers.
Use of obscene language

7.4. Social Responsibility
Refers to the roles undertaken by business organization on the
surrounding environment. It is the liability the organization undertakes
to be called upon to account for the conduct that affects communities or
the society at large Organizations are constraint in their conduct by
legislation which in essence affects their relationship with
stake-holders, employee’s suppliers, customers
the society at large and the environment.

The Stakeholders
Therefore business organizations have social responsibility to a number
of groups (stakeholders) who include the society, employees and the
government. The idea behind the stakeholder’s concept is that there are
certain groups which have specific interest in a business. The interests
may differ from one group to another and can be classified into three
main groups.

Internal stakeholders (employees)
This evolves on the objectives of employees and management who are bound
to have an influence on how the organization is run- they are likely to
be interested in. continuity of employment, the growth of the
organization in order to share its prosperity, personal esteem arising
with this success and Individual interests and goals.
Connected stakeholders
Shareholders are not part of the organization itself, except in the case
of managers and staff who hold equity in the company. They will have
distinctive interests in the business, such as

A return on their investment in the form of dividends and an
increase in the capital
Concerns that the business performs within the law and reasonable
ethical parameters
Participation in decision-taking through exercising rights to attend
the annual General meeting and vote.
The organization’s bankers will have specific concerns relating to
the financial performance of the company, so that any short and
long-term financing will be repaid with the minimum of risk. If the
bank provides finance for a company, it will also wish to ensure
that is kept informed of the company’s financial condition.

The customers of the enterprise require a good quality goods and
services at the right price. They also want to have access to products
through convenient, low cost distribution channels. In addition,
businesses are seeing increasing evidence of consumerism – customers
being more demanding of enterprise not only in what they manufacturer
using child labour in Asian countries is
evidence of this- not only did it impact on the manufacture, but it had
a major effect on perceptions of large football league teams buying the
merchandise.

Ongoing and mutually beneficial business relationships
Being paid in time.

External stakeholders
External stakeholders are those generally unconnected with the business
but who nevertheless have an interest in its activities. This category
includes virtually everyone else.
The government seeks compliance with legal requirements as well as;

Ongoing creation of employment and wealth.
Revenues in the form of income tax
capital gains tax,
corporation tax, national insurance contributions, value added tax
and excise duties.
Information, such as statutory company return and export/ import
information for the department on Trade and Industry.

Local authorities
Have a specific concern with the economic activity that can be brought
to their catchments area. They will also be interested in revenues
though local taxation. A wider concern is the impact of the business on
the local environment. The competitors of the business with to ensure
that there is fair competition and that all businesses operating in a
sector are behaving ethically and in a
climate of mutual respect.

Importance of Enterprise social Responsibility

Enhance business relations with the society. Just as a society
depends on business organization for goods and services, so business
depends on society. When business participate in social responsibility.
It creates acceptance by the society as a whole and as such; it will
create a good working conditions that will enable them to work for the
benefits of their organization.
Recognition of the society’s good will. By engaging in social
responsibility, the business organization is appreciating is
appreciating the fact that it is the society as a whole that has enabled
their continual existence.
Supplement governments effort in development organization also have a
relationships with the government at the local, state and federal
levels. By participating in socially responsible activities that relates
to national development such as buildings of schools or providing
training activities to members of a society, the business organization
are helping in the
governments efforts in development.
Means of waste management- business organization also acts as means
of waste management because they ensure that they participate in a clean
environment,.
They ensure that they keep the environment safe for all in the
society hence they act as a means of waste management. They also help in
waste management by recycling waste products.

Social Concerns of an Entrepreneur
Protection of the environment The environment has over the years become
increasingly common within the business organization agenda, promoted by
a consumer interest in the environment impact of business actions.

Business enterprises considers now they impact the environment ( how
their activities influence the environment) and how the government
influences their activities. Most business enterprises participates in
activities that ensure the following That the environment is polluted as
little as possible. That they adopt preventive measures ( gives due
consideration to the
environment in the early stages of the activity) That law materials are
used economically.

Participation in community work:-
The immediate areas play a very importance part in the creation of an
organization, its reputation, and its continued operation. The business
enterprise are concerned with active participation in community
development programmes like welfare programmes for the aged, supporting
of activities by providing educational, recreational, cultural, health,
transportation, welfare
and housing facilities and welfare and welfare programmer for the
handicapped and undernourished in the community.

Gender issues
Business organization also strive to participate in gender based issues
which is a historical problem. They do this by ensuring that they employ
both men and women in their organization and that the promotions at work
are based on merits not on the fact that one is a woman or a man. Since
women in activities that will ensure that they ensure that hey are
empowered i.e creating training
programmes for women and providing funds to the women to start small
businesses. They also participate in programs of gender based violence
and female genital mutilation by funding such programmes.

Provision of quality goods and services.
The business enterprises are also concerned with the quality of goods
and services that they provide to the market. They ensure the goods and
services are safe and are of the correct standard and not defective.
They do this by conducting ample research before introducing the product
into the market. They also ensure that any complaints by the consumers
are attendant to and
remedies made. Most business enterprise also educate consumers on their
products and they also avoid misleading adverts.

Ethical Business Practices

Ethics is a major factor in the social responsibility of business.
Ethical philosophy if a branch of philosophy that is concerned with the
judgments of the rightness or wrongness of an act. The aim of
professional or business ethics in the protection of professionalism,
human rights, integrity of character, and good service. In general, the
issues considered in such code of ethics consists of;

Honest – in this respect, it is necessary that facts are presented
fairly and accurately. Claims made about products or services, even
in the
Fairness – every one whom you deal with should be given appropriate
consideration. This includes workers, customers, suppliers and
others with whom the organization interacts.
Loyalty- this is in terms of loyalty to other stakeholders i.e
customers, Workers, n suppliers’ e.g.
Confidentially – this is especially important for service industries
such as banks. It is important that transactions with customers are
respected and protected so that they are not disclosed to third parties.
Trust- there should be a mutual trust where the owners of a business
should have proper trust in their customers, while the customers
should also have enough trust in the organization. Without trust, no
meanigl and lasting relationship can develop.
Courage- this refers to the need to treat others with respect, be
incorruptible in business operations, even when it means losing the
business

There are four main schools of thought in moral philosophy, offering
different approaches to solving ethical dilemmas. These approaches are
ways of an organization forming their code of ethics. They include

Deontology- this is the ethics of principle equating any decision
with a moral law. This principle maintains that the act itself
should be considered in judging the rightness of an act. For the “
normal idealist” the motives of the actor and the a consequences of
the act should be ignored in such judgments. This means that any act
is right if it is consistent with an accepted moral principles or
law. Societies have developed certain rules that members generally
accept e.g people do not rob or deliberately injure each other.
These rules are valid in many situations including organizational ones.
Utilitarianism – this is the most deliberate of the three
approaches. It maintains that the rightness or morality of an act
lies not in lies not in the act nor in the motives of the act and
deems it right if majority benefits. According to utilitarianisms,
if the consequences of an act to the individual and society, both
the good and the bad, represent a net increase in society’s happiness,
then the act is good.
Teleogy- this is the ethics of purpose. It considers whether the
outcome of an action accomplishes the original goal. It uses the
actor’s motives in determining whether the act is right or wrong. It
gives priority to the individual to judge the action. If an act
which is within the law ensures the continuation of the business
then it is right.
Egoism: this is the ethics of self- interest, claiming that personal
or organization benefits are the only rational criterion for judging
economic actions.
Technology issues

7.4. E-Commerce

Communication – is the art of sending and receiving messages or
information from one person to another via a channel
Information- this is a product of data which has been given a
structure and put into a context. In order for people to design and
make what is needed to solve a problem, they first need information.
Technology – this is the generation of knowledge and process to
develop systems that solve problems and extend human capabilities.
Other words, people create technology to solve problems and to make
it possible to do new things. E.g people needed a way to keep cold
during how weather so, they invested the refrigerators
Communication technology is the knowledge, tools, machines and
skills that to into communicating. In other words communication
technology is all the things people make and do to send and receive
messages. Telephones, radios, television and
computers are all examples of technologies that help us communicate
with one another. In addition to communicating with other people,
communication technology can be used to communicate with machines
and to help machines communicate with each other. Information is the
knowledge and skill needed in order to take a particular action.

Benefits of ICT to a Business Enterprise

We make use of information to such a great extent in our daily lives
that we probably do not realize how much we are relying on it.
Although information is itself invisible and intangible, the
information may have to use repeatedly will have been recorded in a
paper or prepare for display on a computer screen; though we can
also find whether forecast on radio, convenient at times
Turning to the world of business, we can see that obtaining and
using information effectively is vital. Business makes decisions, at
all levels, more or less continuously; and the quality of those
decisions depends almost entirely on the quality of the information
on which they are based. Businesses complete with one another and
thrive or wither according to how sound their decisions have been.
Business thus needs accessible information that is accurate, up-to-
date and sufficient. ICT (Information and Communication Technology)
refers to the developed knowledge, skills and ideas that pertain to
human communication process and the information they handle.
It is the new science of collecting, storing, processing and
transmitting of information.
Although ICT is important in all organizations, there is a
difference in how important it is. In some organization it is part
of the infrastructure; in some the delivery of goods and services
depends on it; in some, it is a major areas for strategic

improved accuracy, internally and externally
services to customers that are more comprehensive than before
faster processing, leading to prompter responses to customers
Information for management, not previously available, or available
too late to be useful; and tighter financial control.
New customer services previously not possible
New sources of information to allow improved product design and
marketing
New customer services previously not possible
New sources of information to allow improved product design and
marketing
Reduced costs arising from the greater productivity of staff who
supported and assisted by appropriate computer services
A more attractive, cleaner working environment in some cases,
helping recruitment and retention of staff.

Uses of e- business, E, government, e, procurement in small enterprises

E- Business
E- Business is the use of the internet and other networks and
information technology to support electronic commerce, enterprise
communication and collaboration, E, business can also be defined as
web-enabled business process both within an internet worked enterprise
and with its customers and business partners.

Benefits of E-Business

consumers have a much wider choice available on the cyber market
consumers can compare products, features, prices and even look up
reviews before they select what they want
Consumers also have the convenience of having their orders delivered
right to the door step.
Consumers are driven to e-shopping in holders as even branded goods
cost less on the net.
It minimizes inventory costs to the organization. They do this by
adopting just in time- system enhancing the firm’s ability to
forecast demand more accurately.
It improves customer services
It reduces distribution costs

It helps business globalize. This is done through the interest by making
information about certain products available on the net.
It helps market products move quickly.

Because of the significance of small enterprise worldwide, it is
increasingly being realized that if small sector gets behind in the
information, then the whole. The information revolution has opened up a
great deal of potential for small enterprise in the marketing field. The
excellent opportunities E- business offers to small enterprises are to;

Access new market
Improve customization
Lower various kinds of costs
Reduce the size of the enterprise
Sell products/ goods into global market

The fact remains that E- business has empowered small enterprise like
nothing else ad done so in the past. E- Business has emerged as an
opportunity for small enterprises. Not making use of a will turn into a
threat to their very survival

E-Government
E- Government is a new term that finds wide applicability. While the
term still, means different things to different people, available
evidence suggests that it had been undergoing progressive conceptual
development. So for the three generations their conceptual developments
that have been identified are discussed below.

First Generation Conceptualization
In this conceptual generation, e-government is conceived as the
government equivalent of e-commerce, and used to mean the application of
advanced ICT to deliver government services. This conceptualization
emerged from the relative success of “ e- commerce” applications
resulting in pressure being placed on government organization were
doing. As a public sector equivalent of e-commerce, e-government is
viewed primarily as a tool for electronic delivery of public services.
The government transfers a range of services into electronic formats so
as to make them more conveniently accessible over the
internet.Proponents of this conceptual view include Douglas Holmes
(2001), Negaham cook (2000) and John (Arrow 2001). According to Holmes
“electronic government or egovernment, is the use of information
technology, in particular the internet to deliver public services in as
much more convenient, customer –oriented, costeffective and altogether
different and better way. He further points out that cutting costs, and
improving government efficiency, meeting and improving citizens
expectations and relationships and facilitating economic development are
some of the important considerations driving e-government.

Features of E-Government

It is smart government in the sense that it selectively used of
variety if ICT in ways and areas to add value.
It is customer- driver in that, customer needs and conveniences
drive its organizing structures and business processes.
It is responsive, transparent and accountable, responds to the needs
of its customers, and employs ICT to support continuous engagement
with customers.
It is available on a 24* 7 basis ( 24 hours a day and seven days a
week.) thus it does not kept its customers waiting for office hours
and working days.
It is accessible from anywhere since it is ICT – enabled.

What E- Government is not
E- Government is not simply about technology; it is about the applicants
of technology specifically ICT, in government. E- government is not so
much what the government does but it is about how it accomplishes its
tasks. E- government is not about building a smaller or leaner
government, Smart in the sense that it is simple, moral, accountable,
responsive and transparent and also in the sense that its decisions and
actions are goal-oriented, outcome –driven and performance-based.

E-Procurement
E-procurement has been defined by the CIPS as;
The combined use of information and communication technology through
electronic means to enhance external and internal purchasing and supply
management process alternating a shooter definition is;
E-procurement is the business –to – business purchase and sale of
suppliers and services over the internet. The key enabler of
e-procurement is the ability for systems to communicate across
organization boundaries. While technology for e-procurement provides the
basic means, the main benefits derive from the resultant change in
business procedures, process and perspectives. E-procurement is made
possible by the open standards of XML (extensive mark-up language), a
structured language that allows easy identification of data types in
multiple formats and can be understood across all standard internet
technologies. Adoption of XML will help organizations to integrate
policies seamlessly and exchange information with trading partners.

Implementation issues of e-procurement
The CLPs has provided the following list of issues to be overcome when
implementing e-procurement, organization are not simply passing costs or
process inefficiency onto another part of the organization or onto
suppliers. Competition issues i.e in exchanges using collaborative
purchasing. Possible negative perceptions from supplier’s e.g their
margins reduced further from e-auctions. Website and information control
lost to exchange administrators Negotiated procurement benefits may be
shared with other exchange users who may be competitors

Creation of catalogues can be long process and costly to suppliers.
Education – the concerned people in the organization should be
educated by the entrepreneur in new technologies that have been
selected for the project.
Product quality requirements – the technology selected should
consistently give a uniform product quickly that is demanded by the
customer segment.
Technology that gives overall cost and market acceptance ;- the
selection of technology should aim at giving products and services
of consistent quality that market is looking for. The technology is
selected based on long range requirements of the organization and
that gives consistent product differentiation in the market place

7.5. Globalization Trends

Globalization is an international phenomena which sweeping across all
continents and every sector of business. The political barriers to
business are being eliminated. The electronic media and communication
have reduced the distances putting the customer at the center of
business. Business is going global due to the reasons of globalization
and development of state of art technologies, infrastructural facilities
and reducing time and every for transaction.

Entrepreneurs are taking up new ventures in their quest fro global size
organization, profit and large markets beyond the national boundaries of
the entrepreneur. With the result, entrepreneur is also going global
size organizations; result entrepreneurship is also going global thus
making manufacturing, marketing and management that are represented by
different nationalities. The situation calls for different strategies in
countries not as diverse as South Asia countries, USA,
Kazakhstan, Uzbek or Kenya.

The globalization process started worldwide in 80s, the entrepreneurs
are moving to different countries and starting new ventures,. Many
organizations are founded, organized and operated one the principle that
the globe is their field of operations. Modern communication and
transport systems are helping to go global; initially small business
ventures were based on local domestic markets. International business
was consideration domain of large organizations. This perception is fast
changing. Trade has been conducted on international scale for many
years. Establishment of manufacturing organizations, and development of
business by
licensing, arrangements management contracts, joint ventures, mergers,
acquisitions, subsidiaries and strategic partnerships

The availability of cheaper inputs for the production such as raw
materials, infrastructure, trained labour force are taking entrepreneurs
to different counties to give global competitive advantage to their
proposed ventures. Large markets. Going global can generate greater
revenue and greater operating margins. With large funds, it is possible
to purchase sophisticated equipments, update designs and adopt global
manufacturing qualities. An international entrepreneur would like to go
to the countries where there are economic developments and where the
scale of economies can be attained.

Factors Restraining Entrepreneurs from going Global

Government controls and barriers
To protect the local industries, existing industries and employment,
every country tries to protect them. This is done by two ways. One, by
fiscal regulatory measures like, high taxation, inspection, monitoring
controls, quantitative restrictions and foreign exchange controls.
Second through non- monitoring barriers like introduction of controllers
and inspectors, large documentation, legal insecurity, social and
cultural barriers and treatment of outsiders in a different way as
compared to insiders.
Entrepreneurial culture
An entrepreneur should be open to consider dispassionately the business
opportunities that are coming in other countries. The entrepreneur
should have a wide vision to expand geographically.

Advantages of an entrepreneur going global.

Large markets beyond home country borders
Greater motivation in new opportunities
Improvements in the technologies, quality and operations
Extending life of product cycle
Challenges in doing business in competitive environment
Earning foreign exchange for the organization and home country.
Social Cultural Trends
The social cultural environment of a business consists of class
structure, social
mobility nature of social organization, social institutions,
customers and taboos. People’s basic beliefs, values and norms are
largely shaped by their society.
The social setting consists of among other things, people and their
characteristics, their real or apparent roles and their
interpersonal relationships, culture has been defined as “ that
complex whole which includes knowledge, beliefs, art, law, morals,
customs and any other capabilities and habits acquired by people as
members of a society. Thus culture consists of common habits like
people behaviors in their daily lives, and common interest in
entrainment, sports, news advertising e.t.c
Culture serves the needs of people within a society. For instance,
culture provides standards and rules regarding when to eat and what
is appropriate to, eat fro
People‘s behaviors, particularly their consumption patterns and life
styles are influenced to great extent by the social classes to which
they belong. The most commonly used measures of social status are
income, education, occupation and area of residence. Entrepreneurs
should consider their consumers social status before introducing a
product the Kenyan slum area of Kibera.
Another dimension to social and cultural life is the manner in which
social relationships manifest themselves in business, operations,
and operations. Obligations to immediate and extended family
members, kismen, friends and quittances are carried over to reach of
considerations in most business dealings such as those involving
recruitment of personnel and credit sales
The social –cultural dimensions has been identified as one of the
factors contributing to the failure in most African countries.

Economic Trends
Some of the economic factors which promotes and hinders entrepreneurship
includes.
1, Capital: capital is the most important perquisite to establish an
entrepreneur one, machine of another to create his business enterprise.
The stage of economic development in a country plays and important role
while considering establishment of new venture. To some capital refers
to funds available for investment; to others it refers to equipment and
machinery used by entrepreneurs and
managers to produce goods and services; and others still, it refers to
postponed consumption. All these refer to the term capital.

land- according to economies the term land refers to all farm land
and all natural resources provided by nature. Therefore agricultural
land, forests, rivers lakes, seas and all natural resources are
according to economists, land, forests, rivers, lakes, seas and all
natural resources area according to economies to economists land. It
should be realized that the amount of land is finite and can, therefore,
not be appreciably increased.. Land as a factor of economic production
explains the existence of a variety of business
including furniture business and food business.
Labour – this refers to all the physical and mental effort exerted in
the production of goods and services. Unlike land, labour can be
substantially expanded by increasing both its quantity and or improving
its quality. Quantity of labour can be increased by higher birthrates
and or/ improving its quality its quality. Quantity of labour can be
increased by higher birthrates and / or from inflow of people from other
countries. The quantity on other had can be improved through better
health of labourers, better education and vocational training of people
or combining labour with more and better quantities of the other factors
of production.
entrepreneurship – the process of combining land, labour and capital
in some one way in order to produce pertinent goods and services is
called entrepreneurship. One factor that bothers many potential business
owners is how to determine in advance whether one has the qualities of a
successful entrepreneur. Although it is difficult to predict to predict
whether a particular individual will succeed or not if he ventures into
business.

Consumer Trends
A consumer is the end user of a product offered by an organization.
Understanding consumer behaviour is of paramount importance because and
entrepreneur first have to identify consumer needs and then develop a
product that will satisfy those needs if the firm to succeed in the long
–term. There are certain factors that influence consumer behaviour that
the present and future entrepreneurs have to consider.

These factors are divided into;
Internal influences

External influences

Internal influences

Needs and motives- a need is simply a deprivation of something of
value. When a need is sufficiently aroused it becomes a motive. That
is, a motive is an inner state that directs and individual towards
the goals of satisfying a felt need.
Perception- perception refers to the way an individual vies the
world around him. An individual’s perception of an object will
determine how he or she will react towards that object or event.
Entrepreneurs acquire the purchase and consumption
experience they apply to the future related behaviour.
Attributes – an attitude is a leaned tendency to respond to product,
brand of company in a way that is consistently favourable or
unfavorable. The more favorable a consumer’s attitude towards a
product, the higher the usage rate and vice-versa
Personality- personality refers to rather enduring traits or factors
that affect t he manner in which an individual deals with hi
immediate environment. Entrepreneurs are interested in personality
because they believe it affects consumer
behaviors

External factors

Culture- culture is a learned behaviour and results of behaviour
whose component elements are shared and transmitted by members of a
particular society. The entrepreneurs who hope to avoid costly
mistakes should familiarize. Themselves with the culture and
sub-cultures of people they plan to market their products to.
Social class- a social class is defined as an open aggregate of
people with similar social ranking. Class differences are important
to entrepreneurs because certain product is more likely to appeal to
one class that another.
Family- the family has an important influence on the consumption
behaviour of an individual. Quite often each consumption family
member has specific roles in the buying process.
Purchasing power- this is people’s ability to buy goods and services
according to economists whether people buy a product
or not largely depends on their incomes. Price of the present product and prices of substitute products and complimentary
goods among others.

Challenges Posed by Emerging Trends

There is a challenge in changing the type of business activity to
engage in.
It is also difficult to attract additional capital especially for
those who want to venture in small businesses due to the preference
accorded to large enterprise owners by the loaning institutions
Entrepreneurs also have the challenge of sustaining and maintaining
their businesses
Human resource is the one who can make best use of other resource to
convert raw materials into finished products. If no proper resource
to convert raw materials into finished products. If not properly
managed, the enterprise may not be able to realize
its objectives
Marketing is also a challenge because if no proper marketing
strategy is not formulated, then the business enterprise may
collapse. Marketing is the lifeline of any firm.
Developing and entrepreneur culture is also very difficult due to
difficult of many cultural activities that inhibit entrepreneurship.

Management of the Challenges

One should identify a business opportunity and develop a business
idea and do several evaluation of the business idea before engaging
into business
To sustain the business avoid excessive optimism, prepare good
marketing plans, make good cash projection, keep familiar with the
market and be sensitive to stress points in the business
To attract an additional capital ensures you have a proper business
plan that can enable the lenders to lend you money.
An entrepreneur should ensure that there are effective measures to
develop, maintain and motivate his employees in order to manage his
human resource effective
The entrepreneur should find it necessary to update the technology
processes and product as per the need of that time.
An entrepreneur should ensure he/she consider all the factors that
affect consumer consumption before establishing which marketing
strategy to use