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Entrepreneurship for Cooperatives

  1. 1. Entrepreneurship for Cooperatives Edmund Chris S. Acosido
  2. 2. Learning Objectives • Define Entrepreneurial Mindset; • Learn about the tools on developing an entrepreneurial mindset; • Understand the common drawbacks and problems faced by entrepreneurs; • Be updated with the basic data on co-ops • Identify the different types of entrepreneurs.
  3. 3. Preliminaries • Go to and use the code 5594 3552 • Key in the word/s that best describe the picture/words • You can key in up to four (4) answers • Have fun!
  4. 4. WHAT IS ENTREPRENEURIAL MINDSET Mindset Defined Our mindset is made up of belief, ideas and attitudes. Thinking about our mindset can help us when we do things, especially when we face challenges
  5. 5. vs. The Entrepreneurial Mindset Why This Might Fail Why This Might Work
  6. 6. YOU WERE BORN AN ENTREPRENEUR This doesn’t mean you were born to start companies. In fact, most people shouldn’t start companies. But the will to create is encoded in human DNA. And creation is the essence of entrepreneurship. Gain a Competitive Edge Grow Your Business Unit Expand Your Network
  7. 7. THE ENTREPRENEURIAL MINDSET TO GROW — Think Small and Move Fast The companies that operate in this manner are sure to emerge as the leaders in the next decade.
  8. 8. CULTIVATING AN ENTREPRENEURIAL MINDSET Whether you work for a 10-person company, a giant multinational corporation, a not-for-profit, government agency or any type of organization in between to seize the new opportunities and meet the challenges of today’s market we need to think and act like we’re running a startup.
  9. 9. If you want teams making a difference daily, you need to take some pointers from startup culture. MAKE ROOM FOR MISTAKES 03 ENCOURAGE MORE QUESTIONS 01 REMEMBER WHY WE’RE HERE 04 EMBRACE CHANGE 02
  10. 10. WHY DO WE NEED AN ENTREPRENEURIAL MINDSET? • We are all making decisions with limited information • In a time-compressed and resource limited environment • There are no guarantees or safety nets • We take on a certain amount of risk • Competition is changing • The market is changing • Product and Service lifecycles are shorter and shorter
  11. 11. THE TOOL KIT TO DEVELOP AN ENTREPRENEURIAL MINDSET Develop your own competitive advantage by combining 3 puzzle pieces: Your Assets Your Aspirations The Market Realities 1.
  12. 12. THE TOOL KIT TO DEVELOP AN ENTREPRENEURIAL MINDSET Plan to Adapt. Use the ABZ method so that you can adapt based on feedback and lessons learned. 2.
  14. 14. Most of Companies & Our Strategies are “off” by 10 Degrees … so are most of our competitors Closing the Gap Defines Success
  15. 15. THE TOOL KIT TO DEVELOP AN ENTREPRENEURIAL MINDSET Build real, lasting relationships and deploy these into a powerful professional network built on trust. 3.
  16. 16. BUILD & MANAGE YOUR PROFESSIONAL NETWORK A Successful Leader has to have a broader horizon that goes outside the business. And the only way you are going to get that broader perspective is to make sure that you are out there in your networks. In those networks you pick up information and bring it back into the business.
  17. 17. THE TOOL KIT TO DEVELOP AN ENTREPRENEURIAL MINDSET Develop a method to evaluate options and ideas to determine the best new products and services foryour organization. 4.
  18. 18. THE LEAN STARTUP MODEL The core of this entrepreneurial philosophy is pretty straightforward: 1. Define your idea | plan 2. Market test the concepts and assumptions (hypotheses meet experiments) 3. Build a Minimum Viable Product (MVP) | Prototype 4. Roll out new features/designs that are responsive to the market rather than “predictive” of the market 5. Test, test, test 6. Rinse and repeat
  20. 20. THE TOOL KIT TO DEVELOP AN ENTREPRENEURIAL MINDSET Build your skill as a Leader. Build your own Brand! 5.
  21. 21. We Become   What we Eat | Both body and brain health   What we Read | Reading changes brain structure & performance   The 5 People | With whom we spend most of our time
  22. 22. • WE DO NOT LEAD an organization, association or group; and your people do not follow strategic plans, fancy goals or year-end reports | THEY FOLLOW A PERSON • Often, our understanding is diluted with operational plans, goal setting, revenue and sales forecasting, cash flow, HR, compliance and the company’s bottom line. • How You Influence Others is the Most Important Part of Leadership
  23. 23. Individuals are hard-wired to belong Togroups and communities That acknowledge their existence, accept them And help them define their identity. It’s all about BELONGING
  24. 24. Drawbacks & Problems of Entrepreneurship
  25. 25. Problems of Entrepreneurship • Risk of Losing Invested Capital • Starting a business is all about risk. And the small business failure rate is relatively high. According to a study by the National Federation of Independent Businesses (NFIB), 35% of businesses fail within two years, 54% fail within four years and 64% of new businesses fail after six years.
  26. 26. Problems of Entrepreneurship • Long Hours and Hard Work • The average small business owner works 52 hours per week. In many start-up business, 10- 12 hour work days on 6 - 7 days of the week with no paid vacations is the norm. Because owners must often do everything themselves, they experience long, intense, draining work days.
  27. 27. Problems of Entrepreneurship • Lower Quality of Life Until the Business is Established • Long hours and hard work can effect the entrepreneur's outside life. Business owners often put their role as company founder ahead of their role as husband, wife, or parent. Marriages and friendships are some unfortunate casualties of entrepreneurship. Part of the problem is that most people launch new businesses between the ages of 25 and 34, just when they start their families.
  28. 28. Problems of Entrepreneurship • High Levels of Stress • Most entrepreneurs make significant investments in their companies; they leave behind a steady paycheck, and mortgage everything to get into business. Failure can mean total financial failure as well as a psychological blow. This creates high levels of stress and anxiety.
  29. 29. Problems of Entrepreneurship • Complete Responsibility • Entrepreneurship is highly rewarding, but many entrepreneurs find that they must make decisions on issues they are not very knowledgeable about. When there is no one to ask for answers, the pressure can build quickly. The knowledge that these decisions could decide the success or failure of a business can have a devastating effect on the business owner.
  30. 30. Problems of Entrepreneurship • Discouragement • Launching a business requires much dedication, tenacity and discipline. Entrepreneurs may run into many obstacles, some may even appear to be insurmountable. Disillusionment and discouragement can set in, but successful entrepreneurs know that every new business encounters rough patches and that perseverance is required to get through them.
  31. 31. PRINCIPLES OF ENTREPRENEURSHIP How do you define Entrepreneurship?
  32. 32. Entrepreneurship Defined The propensity of mind to take calculated risks with confidence to achieve a pre-determined business or industrial objective The word ‘entrepreneur’ is derived from the French verb enterprendre. It means “to undertake.” In the early 16th century, the Frenchmen who organised and led military expeditions were referred to as “entrepreneurs.” Around 1700 A.D., the term was used for architects and contractors of public works.
  33. 33. Popular Definitions With J. A. Schumpeter, the term entrepreneur had received a wide acclaim. He defined the entrepreneur as an innovator who carries out new combinations to initiate the process of economic development through introduction of new products, new markets, conquests of new source of raw materials and establishment of a new organization of industry.
  34. 34. • Adam Smith described entrepreneur as a person who only provides capital without taking active part in the leading role in enterprise. • Richard Cantillon considered all persons engaged in economic activity as entrepreneurs. • Jean Baptiste Say opined that the entrepreneur was a person endowed with the qualities of judgement, perseverance and a knowledge of the world as well as of business. • Peter F. Drucker defines an entrepreneur as one who always searches for change, responds to it and exploits it as an opportunity. Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or service.
  35. 35. • According to Max Weber – “Entrepreneurs are a product of particular social condition in which they are brought up and it is the society which shapes individuals as entrepreneurs.” • International Labour Organisation (ILO) defines entrepreneurs as those people who have the ability to see and evaluate business opportunities, together with the necessary resources to take advantage of them and to initiate appropriate action to ensure success.
  36. 36. Entrepreneurship is a key driver of economic growth and job creation.
  37. 37. • Entrepreneurship has become increasingly crucial as the Philippines struggles with economic challenge. • Strong Filipino entrepreneurship is urgently needed. • Entrepreneurship is a very important component of a capital economy like the Philippines. • It thrives in economic systems that support innovation and hard work.
  38. 38. Economic development is a scheme aimed at improving the living standards of the nation’s citizenry. To achieve economic development goals, proper management. The following elements are necessary: 1. Human resources (labor supply, education, discipline, motivation) 2. Natural resources (land, fuel, climate) 3. Capital formation (machines, factories, roads) 4. Technology (science, engineering, management, entrepreneurship)
  39. 39. Source: Department of Trade and Industry
  40. 40. Source: Department of Trade and Industry
  41. 41. Name the famous Entrepreneurs in the pictures
  42. 42. Famous Filipino Entrepreneurs
  43. 43. Henry Sy He came from an impoverished family in Jinjiang, a town near Xiamen, China. The entire family left China in 1936 to help the family patriarch manage a thriving convenience store in Manila. His success led to the opening of his first shoe store, the SM in Avenida, Manila. Henry had problems finding shoe manufacturers who could design shoes according to what he had in mind, but he persisted. He spoke to customers and built his own network of suppliers and manufacturers. That never-say-die attitude got Henry Sy to where he is now: one of the richest men in the world and a world-class commercial center developer who provides opportunities to both entrepreneurs and the working class!
  44. 44. Socorro Ramos More popularly known as Nanay Coring is a 92 year old entrepreneur who was born in September 23, 1923 at the rural community of Sta. Cruz, Laguna. At 92, Socorro only acts as the General Manager of the National Books Store. She said that it does not matter if you are born poor, because you are not destined that way, if you only believe you can. Moreover, being an entrepreneur is more of passion and dedication, rather than capital.
  45. 45. Tony Tan Caktiong In 1975, Tony bought a Magnolia ice cream parlor. However, it was not generating enough business. After talking with his customers and people within the neighborhood, Tony decided to include sandwiches, fried chicken, and French fries in the menu. In time, the restaurant found itself packed to overflowing capacity. By 1978, Tony had opened six more restaurants, but the main item was no longer ice cream. Tony then decided to adapt the McDonald’s concept and named his franchise after his work ethic of being as “busy as a bee.” Today Jollibee has grown to more than 2,500 stores in the Philippines plus locations in the US, China, Saudi Arabia, Vietnam, Singapore, and Brunei.
  46. 46. John Gokongwei, Jr. John’s life story is a “rich-to-rags-to riches” story. John Jr. was born in China to the scion of one of the wealthiest families in Cebu. When the father died, so did the business and the family fortune was soon gone. John Jr. supported his family by peddling items along the streets of Cebu by bike. Soon, he was trading items by boat to Lucena City and to Manila by truck. Eventually, he started importing items from the US. Today, the Gokongwei family owns several successful and highly diversified businesses. Among these are Robina Land Corporation and Cebu Pacific.
  47. 47. Mariano Que Many of today’s entrepreneurs would learn the value of customer experience and innovation through Mariano Que. Like many of the entrepreneurs discussed so far, Mariano found opportunities for entrepreneurship after World War 2. Mariano had been working in a local drugstore when the war destroyed several businesses in the city. Mariano sold high-quality sulfa tablets, which ensured him a steady clientele. With his hard work and dedication to build up savings, he was able to put up his first drug store in 1945, which he named Mercury Drug. Mariano’s dedication to his business has allowed Mercury Drug into 700 stores and a widely recognized name for quality pharmaceuticals.
  48. 48. What is an entrepreneur? Entrepreneur is an owner or manager of a business enterprise who makes money through risk and initiative. The entrepreneur leads the firm or organization and also demonstrates leadership qualities by selecting managerial staff. Management skill and strong team building abilities are essential leadership attributes for successful entrepreneurs. Entrepreneurs emerge from the population on demand, and become leaders because they perceive opportunities available and are well- positioned to take advantage of them. An entrepreneur may perceive that they are among the few to recognize or be able to solve a problem.
  49. 49. Types of Entrepreneur Social entrepreneur A social entrepreneur is motivated by a desire to help, improve and transform social, environmental, educational and economic conditions. The social entrepreneur is driven by an emotional desire to address some of the big social and economic conditions in the world, for example, poverty and educational deprivation, rather than by the desire for profit. Social entrepreneurs seek to develop innovative solutions to global problems that can be copied by others to enact change.
  50. 50. Types of Entrepreneur Serial entrepreneur A serial entrepreneur is one who continuously comes up with new ideas and starts new businesses. In the media, the serial entrepreneur is represented as possessing a higher propensity for risk, innovation and achievement. Serial entrepreneurs are more likely to experience repeated entrepreneurial success.
  51. 51. Types of Entrepreneur Lifestyle entrepreneur A lifestyle entrepreneur places passion before profit when launching a business in order to combine personal interests and talent with the ability to earn a living. Many entrepreneurs may be primarily motivated by the intention to make their business profitable in order to sell to shareholders. In contrast, a lifestyle entrepreneur intentionally chooses a business model intended to develop and grow their business in order to make a long-term, sustainable and viable living working in a field where they have a particular interest, passion, talent, knowledge or high degree of expertise.
  52. 52. Entrepreneurs They are often strong individualists, optimistic and resourceful, and they usually have a high degree of problem solving ability. Entrepreneurs look for new and better ways. They are not satisfied with the status quo. Therefore, entrepreneurs are agents of change, they use innovation and creativity as a tool, finding new ways to address needs and wants, new solutions to problems and new processes for achieving production.
  53. 53. As an Entrepreneur, I use the different parts of my body to…
  54. 54. Entrepreneurs Possess Several Positive Characteristics
  55. 55. Social Enterprises Cooperatives are people- centered enterprises owned, controlled and run by and for their members to realize their common economic, social, and cultural needs and aspirations. Cooperatives bring people together in a democratic and equal way. Whether the members are the customers, employees, users or residents, cooperatives are democratically managed by the 'one member, one vote' rule. Members share equal voting rights regardless of the amount of capital they put into the enterprise.
  56. 56. COOPERATIVE Cooperatives allow people to take control of their economic future and, because they are not owned by shareholders, the economic and social benefits of their activity stay in the communities where they are established. Profits generated are either reinvested in the enterprise or returned to the members. The cooperative movement is far from being a marginal phenomenon, at least 12% of humanity is a cooperator of any of the 3 million cooperatives on earth.
  57. 57. Cooperative Data As of December 2019 513,000 Direct Employment ₱512 Billion Total Asset ₱22 Billion Net Surplus EMPLOYMENT ASSET NET SURPLUS Luzon 363,107 315,382,099,391.18 13,721,043,269.34 Visayas 32,887 84,222,850,672.64 3,262,602,859.62 Mindanao 117,123 112,158,569,258.71 4,936,557,335.52 2.5 Million Indirect Employment
  58. 58. 11.6 Million Members Male 5,042,995 Female 6,512,510 No. of Cooperatives Membership Luzon 10,234 5,820,642 Visayas 3,608 2,339,115 Mindanao 4,739 3,395,748 18,581 Cooperatives Cooperative Data As of December 2019
  59. 59. • Coops engaged in savings and credit • Consumer / canteen and catering services • Sale of Agricultural products • Marketing/Trading (non-agri products) • Production/Manufacturing • Transportation • Rental of Equipment/Office Space • Labor Service • Water services • Training providers • Others economic activities Economic Activities of Cooperatives
  60. 60. Thank You!