Our first Assignment Paper has you researching and applying our reading this week to a Company that
symbolizes the entrepreneurial spirit. So, you will be researching “TOMS Shoes” and it’s Founder/Chief
Shoe Giver, Blake Micoskie, in responding to the Assignment questions that follow. TOMS Shoes, is an
online seller of shoes, has a unique marketing philosophy that is based on a considerable level of
corporate responsibility and philanthropy. Their shoes are primarily sold online and for every pair of
shoes a person buys, a pair of shoes is provided to a child in a developing country. As a starting point for
your research, you might want to visit their website at www.toms.com.
In pulling your minimum 2-page response section together, you will want to respond to the following
questions (based on our ebook reading and using “qualified” research sources) and respond to each
question in the order asked.
1. Describe the elements of entrepreneurship.
2. Describe how the key elements of entrepreneurism (as outlined in our reading and based on
your “qualified” research sources) have influenced the Founder of TOMS?
3. Explain how social responsibility and social entrepreneurship play a role in how TOMS is
structured to achieve their profit motive and positive social goals simultaneously.
4. By using and expanding on the “Dream Scale,” that is found in our ebook reading this week,
apply this framework to how would this be applicable to a business that you would like to open
in the future?
5. In follow-up to the 3rd question, how can you personally apply the principles of social
responsibility and social entrepreneurship to the business that you would like to create?
APA Requirements & Suggestions
APA format writing has very specific writing requirements that need to be met and are graded at Kaplan.
A few of these major requirements include:
• Microsoft Office programs only: Word, PowerPoint, or Excel (versions 2007 or higher)
• A Title Page should be the first page of your Assignment
• Each page should be double-spaced (no spaces between paragraphs)
• You will indent each new paragraph
• Font should be Times New Roman and 12 pt. font only
• 1” margins all around for your page setup
• APA formatted Reference Page is the last page of your Assignment
• Your Reference Page should include at least two “qualified” research sources on it
• You should include at least two Citations in your response section (each instance should be
just a sentence or two or support your writing)
• Bullet Points and Numbered Lists should not be used
• Qualified Research Sources should only be used (i.e. no resources exemplified by Wikipedia
and about.com will be accepted) and typically these are found by using resources like the
The dream scale;
Moving from your dream to a business reality involves the following steps:
1. Fantasy 2. Dream 3. Concept 4. Goals 5. Business plan
Most—if not all—successful businesses start with a dream. Yet there’s a difference between those who merely dream and those who make their entrepreneurial dreams come true.
The steps that move from dream to reality make up the entrepreneur’s “dream scale”—from the least-achievable stage of dreaming to the most achievable and action-oriented one.
1. Fantasy. These concepts are impossible or highly unrealistic to achieve. Hucksters make fortunes off people who fantasize about getting rich in their spare time. Whether it’s an infomercial, a weekend real-estate seminar, or a multilevel marketing program, what most of these people sell is the fantasy that you can make money without hard work or risk. Most of these schemes drain money and time away from achievable goals, such as going back to school or starting a realistic business.
2. Dream. Although these concepts are potentially achievable, at this stage, you see only the positive side. Most people have a dream business they’d like to run—a bed-and-breakfast, a wine bar, a fantastically successful social-networking site. Are these fantasies? No. Some people do run delightful B&Bs on Cape Cod; others start Facebook or Twitter. How- ever, the reality is that it’s very difficult and expensive to succeed at most of these businesses. But at this stage, all you see is the upside.
3. Concept. At this stage, you have achievable ideas but you also bring the downsides and difficulties of your dream into focus. You’re willing to challenge your own assumptions and the claims of those who promise to make your dreams come true. You’re not afraid to look at the costs, limitations, or work required, and you’re willing to begin evaluating realistically your chances of success.
4. Goals. At this stage, you make a specific, realistic evaluation of what you personally want to achieve and what you’re willing to sacrifice to achieve it. Even practical visions involve trade-offs: If you want a large business, you may need investors who would exercise some or all the control over your company. Make sure you’re comfortable with these trade-offs.
5. Business plan. Finally, you’re ready to develop a thorough, thoughtful, step-by-step road map to success. This is where you actually figure out how to make your vision and goals a reality. You examine your industry, study the competition, and research your market. You identify the best strategies for success and detail your action items, milestones, marketing, and operations.
Do you dream of one day owning your own business? Do you have an idea for a new or improved product or service that you hope to turn into a reality— something that people will want, buy, value, and even love? Do you feel a need to be in control of your own life? To have the opportunity to act on your ideas? Do you want to be your own boss? Are you able to motivate yourself to work hard, to do well, even without a boss, or teacher, or parent looking over your shoulder? Do you have the persistence to stick with something until you can make it a reality? Are you willing to risk security—of a job, a paycheck, a manager guiding you, the structure of a workplace—for the excitement and possibility of creating your own company? For the chance to perhaps make a fortune or at least earn a good living? Are you willing to learn how to handle failure in return for the possibility of independent business success? Then what you are dreaming about is “entrepreneurship.” The origin of the word is “entreprendre”—French for “to undertake.” Take a look at that word undertake.” Notice that it emphasizes an attempt to act, and not the outcome of that action. You undertake something. This implies that what matters is that you have begun something; you’ve started on a journey. And although traveling on that journey may not always be a smooth ride, at least you’re in the driver’s seat.
Entrepreneurs change the world
Entrepreneurs make enormous contributions to societies around the globe. Fast-growing entrepreneurial ventures transform entire economies. Even smaller enterprises make tremendous contributions to the health and stability of their communities.
Entrepreneurial companies produce far more than just money. They also provide:
· New ideas and innovation. Although some large corporations have research and development departments, overwhelmingly, new products and services are created and introduced by new small companies. This is certainly true in technology, but it’s also true in the entire spectrum of products and services. Many Fortune 500 companies—from computers to cars, cola to cartoons—were started by entrepreneurs with little more than a new and better idea.
· New jobs. Total new-job creation in the United States is a result of new businesses. In fact, America relies on new businesses to offset the job losses from bigger and older corporations. The Small Business Administration (SBA) estimates that small businesses create 65 percent of all new jobs in the country. Worldwide, substantial job creation is largely a result of new business formation, especially in emerging economies.
· New industries. Entrepreneurs not only create new businesses, but when they’re incredibly successful, they may even end up creating entire new industries. In recent years, for example, the success of a few social media companies—like Facebook—has fostered the generation of a whole ecosystem based around those companies. This leads to an immense explosion of jobs in related businesses.
· Middle class income. In many areas—including rural areas, developing countries, and older regions in the United States—there are no large corporations to provide decent jobs. There, the only path to a middle class lifestyle (or better) is through the creation of one’s own business.
· Flexibility. Smaller companies can open, close, move, and change focus much more quickly than big corporations. Typically, smaller companies are the first to respond to changing market needs and conditions, and often provide a testing ground for big corporations to learn how they themselves will need to adapt. The smaller companies offer the job opportunities and new products our society needs until big firms figure out how to catch up.
· Old values. Big companies get distracted by things such as keeping Wall Street happy, arranging mergers and acquisitions, and rewarding executives with huge bonuses. Newer companies, by contrast, concentrate on the basics: cash flow, profits, providing high-quality products and services, and serving and retaining their customers. Perhaps even more important, owners of newer or smaller businesses know their employees are people, not “human resources,” and need to be treated as such.
Entrepreneurs, in short, make a huge difference. They innovate, pioneering new industries and producing new products. They provide vital services. They support their communities. They create wealth, for the entrepreneurs, the investors, and society. Most important, they create jobs. And when you create jobs—good jobs, with fair pay and good working conditions, where people can take pride in their work and be treated with respect—you change their world, your world, and the world in general.
Growth of entrepreneurship
Humans have been engaged in entrepreneurial endeavors for thousands of years. It’s nothing new for someone to see something that people want to buy and then figure out a way to sell it. It may be part of human nature to be able to identify an opportunity and wish to seize on it, and, through hard work, be motivated to make money in the process.
While it’s true that entrepreneurship has been around for a long time, we are now in a golden age of entrepreneurship. Throughout the world, entrepreneurs are making a greater impact than ever before, and gaining the recognition that comes from that impact.
Although much attention is paid to technology-based start-ups, especially in places like Silicon Valley in California, the truth is entrepreneurship is flowering in all industries and geographic locations around the world. Even concepts that once were the sole province of philanthropists and charitable organizations have now become the interest of entrepreneurs who aim to apply their innovative and strategic thinking to solving some of the globe’s most pressing problems.
Indeed, since the earliest part of the 21st century, there has been a ground shift. The best and the brightest in our society, who before might have gone to work for big corporations, now want to start their own ventures, at younger and younger ages. Some of the growth in entrepreneurial desire has certainly come from seeing the example of those who have succeeded—especially young entrepreneurs—who have created whole new industries, transformed the way we live and work, and made fortunes along the way. Seemingly overnight, entrepreneurs have become millionaires—even billionaires—as a result of launching innovative businesses.
Of course, most entrepreneurs never become millionaires. Yet the chance to act on your ideas, to make your own way, to create new products, to invent new services, and to make a difference in the world, has encouraged record numbers of people to become entrepreneurs.
Factors driving the growth of entrepreneurship
Besides the example of successful entrepreneurs, what’s propelling the rapid growth of interest in launching one’s own businesses?
· Less job stability. The days are long gone when people assumed they would work for one company all their lives. For starters, a large number of businesses today run extraordinarily “lean.” Rather than hiring full-time permanent employees, many businesses opt for part-time personnel or either temporary or contract workers. There has also been a cultural shift in how people view their employment and careers. Most people expect to—want to—change jobs. A person born in the later years of the “baby boom” (1957–1964) held an average number of 11 jobs just between ages 18 and 44.1 Younger people today are likely to have as many different jobs, if not more. Indeed, it’s typical for people in developed countries, especially the United States, to have two, three, or even more “careers” over the course of their lifetimes as their interests change and evolve. With less job stability, there’s more opportunity—and more need—to start your own business.
· Lifestyle driving career choices. Want to live in the mountains so you can ski, or by the beach so you can surf? Be home in the afternoon to raise your kids? Increasingly, people want their careers to mesh with their lifestyle goals. Entrepreneurship allows much more flexibility to create an income in a way that meets personal goals. You can create businesses in locales where the kind of job you want doesn’t exist, have more flexibility in work hours, and spend less time commuting and more time on family, hobbies, or other interests. The desire for a lifestyle that a traditional job can’t satisfy is one key reason that people choose an entrepreneurial path.
· Technology infrastructure. It has become cheaper and easier than ever to start a business. Businesses that once required a huge upfront investment in infrastructure, equipment, and staff can now do a lot more for a lot less. Many of the daily administrative and office tasks can easily be automated; a huge array of companies exists to provide technology solutions to small and new businesses. Web design firms, search marketing specialists, third- party IT services providers, and all sorts of consultants represent merely a few of the new types of business opportunities that have emerged. It’s possible to build a fairly substantial business with only a virtual team, especially for technology needs.
· Technology opportunities. New technology creates new business opportunities. The Internet, in particular, over the last few decades has created entire new industries—mobile, cloud, and social media. Advances in technology and science have led to an explosion in biotech, genetics, and medical equipment and other health care–related industries. “Green” technology is providing significant new prospects in a wide range of environmentally related businesses. In virtually every category, the rapid changes in underlying technology have opened up great possibilities for entrepreneurs.
· Government support for entrepreneurs. Throughout the world, governments have increasingly recognized the importance of new ventures and small businesses for their economic growth and health. National governments are setting up agencies to assist entrepreneurs, lessening regulation and red tape for starting new businesses, and providing tax benefits. Even state, regional, and local governmental entities are getting in on the act, helping to make it easier for new business formation. Officials realize that without new businesses economies stagnate.
· Mature financing environment. Investors have become more and more comfortable with putting their funds into new and risky ventures. The unbelievable financial success of those who have invested in entrepreneurial ventures since the last two decades of the 20th century and during the first decade in this century has led to the growth of a large pool of investors willing to take risks on entrepreneurs and new ventures. There’s now a mature, sophisticated, and well-funded investing community in a few key regions of developed countries. And, even in smaller communities and less developed areas, many more private investors— “angel investors”—are willing to support entrepreneurs. The availability of more venture capital means the possibility of many more new businesses launching.
· Financial considerations. Many people simply don’t feel they can meet their financial goals by working for an hourly wage or even a professional- level salary. This is especially true in areas with few high-growth and professional opportunities, as well as in many developing countries. The notoriety given to young multimillionaire founders and early employees of high-tech start-ups has fueled many people’s dreams. No surprise, then, that many people feel that they can achieve their financial goals more fully and easily if they choose to become self-employed—or to build their own business and employ others.
Thinking like an Entrepreneur
Can you learn to be an entrepreneur, or must you be born with an entrepreneurial spirit? While some people are naturally more oriented toward an entrepreneurial lifestyle, and feel more comfortable with the uncertainty that comes with entrepreneurship, it’s definitely possible to work on developing some of the key attitudes and attributes of those who start and grow successful businesses.
Many business books and experts assert that there’s just one kind of person who can be a successful entrepreneur—someone who’s a risk taker, extroverted, a natural salesperson, a leader and a visionary, someone willing to work around the clock.
It’s a great list, but it’s just not true. There’s a whole range of personalities who become successful entrepreneurs. The key is to find the right type of business to suit you.
Of course, someone who, by nature, needs an extremely high level of security, guidance, and reassurance might be a poor fit for an entrepreneurial lifestyle. But the idea that you must relish risk—be an emotional skydiver—is often overstated when describing the types of people who make good entrepreneurs. Many people who don’t think of themselves as embracing risk become entrepreneurs. The key is that although a successful entrepreneur takes risks, those risks are measured. While entrepreneurs frequently go out on limbs, the ones that make it generally test that limb first to make sure it has a good chance of bearing their weight.
Great entrepreneurs expect change
Change is inevitable, but one thing that sets successful entrepreneurs apart from others is their willingness to adapt to, embrace, even leverage change for their own gain. Many entrepreneurial companies, especially those involved in technology, have change at the very core of their existence. Still, for every business, change is inevitable.
Even companies that were created on the basis of innovation often become staid over time. Once they have established customers, channels, business units, and models, it’s easy for them to get complacent. Their employees become used to doing things the way they always did. When companies are mired down in doing things the same old way, they’re viewed as rich targets for newer, entrepreneurial companies to go after.
The best entrepreneurs—the ones who succeed over decades—recognize that they must keep responding to change, reinventing their companies, continually innovating.
In planning for change, keep in mind the kinds of conditions that will affect your business’s future.
· Technological changes. It’s impossible to predict the exact technological developments that will affect your industry, but you can be sure that you’ll be faced with such changes. Even if you are making old-fashioned chocolate chip cookies, you’ll find that advancements in oven design, food storage, and inventory control software will place competitive pressures on your business. Competitors’ technological advances may cause significant downward pricing pressures on you.
· Sociological changes. Evaluate demographic and lifestyle trends in light of their potential influence on your business. In the cookie business, for example, consumer interest in natural foods or the number of school- age children in the population may influence the number and kind of cookies you sell. What sociological factors have the greatest impact on your company? Keep your eye on trends that represent true change; be careful not to build a business on passing fads.
· Competitive changes. New businesses launch every day. How hard is it for a new competitor to enter the market, and what are the barriers to entry? The Internet has made it possible for companies all over the world to compete against each other, increasing the number and type of competitors you may face.
· Market and marketing changes. Consider how your company deals with these outside changes. Also anticipate major internal changes, such as growth, the arrival or departure of key personnel, and new products or services. No business is static. Planning a company to be agile and responsive to change will make the inevitable changes easier.