Report data of entrepreneurship

HRM in Entrepreneurship
Human resource management (HRM or HR) is the strategic approach to the
effective management of organization workers so that they help the business gain a
competitive advantage.

Human Resource Management includes conducting job analyses, planning

personnel needs, recruiting the right people for the job, orienting and training,
managing wages and salaries, providing benefits and incentives, evaluating
performance, resolving disputes, and communicating with all employees at all
levels.

Need of HRM

Entrepreneurs who choose to start a new firm are usually categorized into novice
(founders of their first independent business) and habitual entrepreneurs (founders
of several companies consecutively). We assume that, due to the liability of
newness, novice entrepreneurs lack human resource management competences. As
the company grows the size of the entrepreneurial team and the dynamic of its
composition increase. This makes the need for HRM competency.

Implementation of ten "Cs" of human resources management is also important for

the new ventures to achieve competitive advantage which are: cost effectiveness,
competitive, coherence, credibility, communication, creativity, competitive
advantage, competence, change, and commitment. The ten "Cs" frameworks were
developed by Alan Price in his book "Human Resource Management in a Business
Context".

Intrinsic motivation

In order for inspiration to become a daily driving force and therefore to foster
continuous innovation within firms, high levels of creativity are required. This can
only be attained through intrinsic motivation.
Intrinsic motivation is determinant for high levels of creativity. There are five
aspects of the work environment that are particularly relevant for intrinsic
motivation: encouragement, challenge, autonomy, resources and team composition.
These aspects reflect the characteristics of entrepreneurial ventures.

Recruitment

During the start-up phase the core team members are recruited from both social
and business networks, whereas during the growth phase recruitment is carried
out almost solely from the business network. Furthermore, the people employed to
initiate the business are not necessarily the same type of people who will continue
to sustain the firm. At the beginning founders usually hire generalists who are
willing to put a lot of effort into and feel very passionate about the new venture.
Later, when the firm starts to grow, more seasoned professionals are employed,
who through their knowledge and experience can accelerate the business and foster
growth.

Compensation

Alongside with recruitment, compensation is another crucial area for small firms’
survival and growth. Appropriate compensation is extremely important for
emerging firms to acquire core talents. Entrepreneurial firms are willing to reward
creativity, innovation, willingness to take risks, cooperation, interactive behavior
and tolerance for ambiguity and uncertainty. Rewards systems are usually based on
bonuses which may include both profit and stock sharing. By creating the feeling
of ownership interest in the firm, such systems allow emerging firms to retain core
talents.

Rapidly growing firms often operate without formal HR policies for compensation,
which is often negotiated on an individual basis depending on the needs and
resource constraints of the firm and, on the other hand, on the skills and experience
of the employees (Balkin and Swift, 2006).

Leadership, training and development

According to Schumpeter (1934) a successful innovation requires an act of will

and not of intellect. Therefore innovation, which should not be confused with an
invention, especially depends on leadership and not only on intelligence.
Entrepreneurial management leadership is all about breaking new ground and
going beyond the known. It is also about helping people to engage in new
opportunities.

Entrepreneurs reflect the characteristics of both transformational and charismatic

leadership. Both leadership styles contribute to build up an organizational culture
based on learning, tolerance and trust.

Personnel development appears to be an important issue within the concept of

entrepreneurial leadership .Training and development prefers to enhance the skill
and knowledge of employees.

It is the process of –

1. Enhancing the motivation, knowledge and skills of potential entrepreneurs.

2. Reforming the entrepreneurial behavior in their day- to-day activities.
3. Encouraging them to improve their knowledge and skills.

Entrepreneurial Marketing

The most common features of entrepreneurial marketing include innovation, risk

taking, and being proactive. Entrepreneurial marketing campaigns try to highlight
the company's greatest strengths while emphasizing their value to the customer.
Focusing on innovative products or exemplary customer service is a way to stand
out from competitors.

Marketing strategies are implemented through marketing activities of various

types, which have been summarized as the marketing mix, the set of tools at the
marketer’s disposal.

Gurella marketing

 Guerilla Marketing - Also called Low Budget Marketing

• Basic aim: Maximum attention of the target group – in spite of a low budget –
through inventive and fancy ideas

Examples of Guerilla Marketing Strategies • Word-of-mouth advertising •

Adressing consumers in their everyday work situation, for example via E-Mail •
Sticker and poster campaigns with electrostatic, self-adhesive materials •
„Forehead“-campaigns • Blue jacking: Sending personal messages via Bluetooth •
Advertisements on cars • T-Shirts • Covered advertising • Advertisements on sales
receipts

 The Concept of Ambush Marketing

Also called Freeride-Marketing • A company uses an event which is sponsored by

another company to cause positive effects on their branding without the permission
of the sponsoring company • Both companies are competitors • Ambush Marketing
mostly takes place at big sport events like the FIFA Football World cup or the
Olympic Games.

E.g: K-Swiss at the Paris Open

 The Concept of Viral Marketing

Viral Marketing uses social networks like Facebook etc. to gain brand awareness. •
Information about the product passes virally from human to human • A low-cost
marketing method which is very efficient.

Examples of Viral Marketing

Hotmail When Hotmail launched, much of its early success was due to the virility
of the sign line that it attached to every outgoing email inviting the recipient to
join. This is one of the earliest examples of viral marketing on the internet.

References:

https://www.researchgate.net/publication/242350060_Entrepreneurial_marketing_
A_strategy_for_the_twenty-first_century

https://www.tandfonline.com/doi/abs/10.1080/03088839800000046?journalCode=t
mpm20

https://www.entrepreneur.com/article/43018

http://www.whatishumanresource.com/human-resource-management

https://www.emeraldinsight.com/doi/abs/10.1108/01437720510625403

http://journals.univ-danubius.ro/index.php/oeconomica/article/view/2124/2863