Sustainability in Entrepreneurship, Innovation

Discuss the relationship between enterprisership, innovation and scotch knowledge. What role does sustain mightiness play in this relationship? Refer to both supposition and compositors cases from the business world to support your discussion. In todays economy, entrepreneurship is an principal(prenominal) subject and entrepreneurial abilities demand become a pivotal demand both nation entirelyy and globally. However, enterprises that succeed mostly do so as they atomic number 18 capable of change for the better, finished innovation. So for an enterprise to be happy innovation is required.Creativity and innovation is at the heart of the 21st century. For example in the United States alone, more than than 16,000 firms operate their own research labs These successful enterprises and their advancements in innovation as a result lead to a countrys frugal development. sparing development has become a focus of attention by governments around the world. As the UK Office o f light and Technology (2007) put it, Innovation is the motor of the modern economy.. Thus at that place is no doubt that a confederacy between entrepreneurship, innovation and economic development prevails.The three pointors be complementary because innovation helps any design of entrepreneurship to prosper, thereby increasing its economic value, thus impart to economic development. This topic will examine this relationship of entrepreneurship, innovation and economic development, and explore the issue of its connection. To begin, it will define these terms, and then connect them accordingly, using economic lit and real life examples for evidence. Secondly, the essay will look at what sustainability is, types f sustainable innovation, whether its a threat or opportunity for enterprises, and its put in on economic development.The term entrepreneurship ass take numerous definitions. entirely put, entrepreneurship is the act of an entrepreneur, and that is someone who as sumes the take a chance for and organizes a business project. Economist Richard Cantillon scratch line used the term entrepreneurship in his book Essai Sur La character de Commerce en General (1959) where he explains that an entrepreneur is one who buys things at a lower price, and sells them at a higher price, undertaking the risk factor. More recently, Joseph Shumpeter provided a thorough description, where he divided entrepreneurship to two types allocating and catalytic.Further, Shumpeter (1934) express on the importance of an entrepreneur to be ripe, Whatever the type, everyone is an entrepreneur altogether when he actually carries out a new combinations and put ups that character as soon as he has built up his business. This leads into the connection of entrepreneurship with innovation. Mintzberg (1983) defined innovation as the means to break away from core grouped patterns. Innovation is the excogitation of something new and in the business world, it would be for paying(a) benefit. fit to Shumpeter, it toilette be the foundation garment of a new product, possible action a new market and so on.Thus, it can be verbalise that innovation is required for an enterprise to succeed, so is a factor contri simplying to the process of entrepreneurship. Innovation can take two earns, incremental or stalk. A radical innovation can be stated as a gap-filler as economist Harvey Leibenstein (1968) put it, which is a novel creation that fills a gap in the market. Radical innovation is a alert for economic development as the fuss is missing markets is solved. There we stick out the connection of innovation with economic development.Economic development can be defined as a validating progress in an economy, usually through government expenditures to promote the wellbeing of the economy and society as a whole. It can be measured by taking into account a countrys standard of living, economic health, environmental sustainability and other factors. Acco rding to Harvey Leibenstein in his book The American Economic Review (1968 p77), there is no universally accepted supposition of economic development, but there are two important elements that guide to development, one of which is the Interaction between the creation of economic capacity and the related creation of demand .. The entrepreneur is likely the prime mover of the capacity creation part of these elements of the growth process. In addition, as said in the Hamilton Project (2012), Innovation has transformed the American economy through the development of automobiles and highways, airplanes, telecommunications, and the internet, all of which have made it increasingly easier for businesses to market their products.. which as a result, help the business enterprises. Thus, it is undeniable that there is fortified connection between entrepreneurship, innovation and conomic development, as has been stated in literature time and time again. It can also be be with the use of real life examples, for instance in the software product patience, which today is globally worth $489 one million million million. Microsoft, the worldwide leader in software engineering science, an innovation founded by Bill Gates, had a r heretoforeue of $28. 37 billion in the year 2002, and employed more than 50,000 employees in 78 countries as said in Andriopoulos and Dawsons, Managing Change, Creativity & Innovation Textbook (2009 p94).Microsofts software is an example of an incremental innovation, and a successful enterprise, which thus became a major(ip) contributor to USAs economic development. An example of a radical innovation that majorly contributed to economic development was Henry chuck out throughs simple craft of the assemblage line method of production in the 1920s. Its application to the production of Ford cars reduced the time to produce the Model T Ford by 68%, thereby increasing efficiency, and reducing its follow by 62%, thereby increasing the demand fo r the car.This a result increased transaction in America, increased travel around the country, helped all businesses reduce woos, and brocaded the standard of living of the middle-class American family who could now afford a car, which had once been a luxury. All these factors contributed to of economic development of the US economy, which was boom at the time. Therefore, it can be firmly stated that a strong connection between entrepreneurship, innovation and economic development does exist, and that they are a good deal time co-occurring.A change in one can have an effect on the other save, they are not dependent upon on another. For example, economic develop does have other factors contributing to it, aside from entrepreneurial gain. Secondly, I believe that entrepreneurships can succeed without innovation. This is where I disagree with Schumpeters hypothesis of Creative Destruction. In this, Shumpeter claims that an entrepreneur has to do something novel to be successful, however in world of business there have been instances that prove his theory wrong.For example, in the 1990ss, a team of entrepreneurs from the US implemented a set of multi screen cinemas in Mexico City called Cinemax, which was a well-known and established business model in the US. This was very successful in Mexico City, and the image of cinemas was sold for $300 million ten years later. This is very entrepreneurial, but not innovative. Therefore I believe that whilst innovation and entrepreneurship go fall in in hand, an entrepreneur does not necessarily need to be innovative in his/her thinking to be successful.Hence, I agree with Schumpeters theory only to an extent, in that they are strongly related, but disagree with the fact that an entrepreneurship has to be novel in order to be successful and contribute to economic development. Almost all economies today are growing rapidly, china and India for example. Though this is a primary objective of all countries, governments and other environmentally amiable organizations are far more concerned on ensuring that this development occurs without excessive damage to the environment.The aim is to ensure human needs are met but also conserved for the needs of the future generations, and as a result conserving the environment. This is also known as sustainable development. According to the Brundtland discipline (1987), sustainable development is Development that meets the needs of the present without compromising the ability of future generations to meet their own needs. Sustainability can take many forms, including economic, friendly and environmental. This essay will look at sustainability in the economic form and understand sustainability from the business point of view.The implementation of government regulations, such(prenominal) as UKs DEFRA, which look at conserving and protecting the environment, and fine or knock businesses that do not, may initially seem as a problem for many companies. But in actuality, in can help the businesses and even be an opportunity for innovation. The need to be sustainable has created environmentally friendly inventions, an internal driver of sustainability, boosting economic growth accordingly. Sustainability in business upholds enterprises to cut down on its costs and produce more with less. Companies today reduce, utilize and recycling waste material.In addition, it gives way for invention of environmentally friendly products, such as the Panasonics Rhythm eShower for water conservation and Toyotas invention of the Prius, an electric car, which would in turn reduce fuel consumption. Toyota even won the title of Best Global Green Brands 2012 (BusinessWeek, 2012) for the second time in a row. Further, it has resulted in the invention of renewable energy methods such as solar photovoltaic cells and tidal stream generators, a new industry in the market. British company, Lunar Energy has decided to build the worlds freshman tidal energy farm de ep sea, providing energy for 5000 homes.As a result, creating exercising too. The requirement for businesses to be sustainable has created employment, promoted innovation and has even opened up a whole new industry in renewable energy, thereby contributing to economic growth. The contribution sustainable development makes to the economy is pee in the hanker run, as the economy is sure to sustain in the future as well. The Stern Review on the Economics of mode Change (2006) explains how there is a negative impact on economic growth if governments and businesses are not environmentally friendly.Economist Nicholas Stern stated that if we assumet act in a sustainable manner, the impacts that occur would cost damage worth of 20% of a countrys GDP. Whereas in contrast, investment in greener and more sustainable development today, would only cost 1% of global GDP each year. I believe that spot sustainable development may result in some businesses to lose out, overall it opens new ind ustries, encourages innovation and also works in respect of the economy in the long run.To conclude, It can be stated that sustainability can play an important role in economic development, and can encourage enterprises to innovate environmentally friendly technology, cut costs, and thus be more successful. It also helps a countrys economy in the long run as it would not have to heavily spend on the damages caused by global warming. As said by Schumpeter, (1934 p367) The entrepreneur is the prime mover in economic development and his function is to choose out new combinations. This is true in the sense that through innovation, enterprises can succeed and contribute to an economys development.Thus, it is clear that businesses and innovation have a positive effect on economic development are strongly connected. But again, I do not believe that all enterprises must be innovative to succeed, and that for a new business to open, a current one must be eroded. Therefore in closedown it can be stated that entrepreneurship, innovation and economic development are complementary in real life, and are at often times co-occurring, but are not dependent on one another. And load-bearing(a) businesses to be sustainable will only have a positive impact on the economy, when taking the long run impacts into account.Bibliography The American Economic Review Harvey Leibenstein. (May 1968) Page 77. Volume 78, No. 2, American Economic Association. Entrepreneurship and minuscule Businesses Paul Burns. (2007) 2nd Edition, Palgrave MacMillan, refreshed York Stern Review of the Economics of humour Change Nicholas Stern. (October, 2006) The Theory of Economic Development Joseph A. Shumpeter. (1983) Transaction Publishers, New Brunswick, New Jersey Our Common Future (The Report of the Brundtland way) United Nations World Commission on Environment and Development. 1987) BusinessWeek Bloomberg. (July 2012) Power In and Around Organizations (The Theory of charge Policy) Henry Mintzb erg. (January 1983) print by Prentice Hall, College Division Hamilton Project Michael Greenstone, ecstasy Looney and Leslie B. Samuels. (May 2012) Managing Change, Creativity & Innovation Constantine Andriopoulos and Patrick Dawson. (2007) Published by TJ International Ltd. Padstow, enormous Britain Essai Sur La Nature de Commerce en General Richard Cantillon. (1959) Published by Frank Cass and Co. , London