Tag: Entrepreneurship

Entrepreneurship!

The activity of setting up a business or businesses, taking on financial risks in the hope of profit. Entrepreneurship is the process of designing, launching and running a new business, which is often initially a small business. The people who create these businesses are, entrepreneurs. As the “capacity and willingness to develop, organize and manage a business venture along with any of its risks in order to make a profit”

The capacity and willingness to develop, organize and manage a business venture along with any of its risks in order to make a profit. The most obvious example of entrepreneurship is the starting of new businesses. In economics, its combines with the land, labor, natural resources and capital can produce the profit. The entrepreneurial spirit is characterizing by innovation and risk-taking and is an essential part of a nation’s. Ability to successes in an ever-changing and increasingly competitive global marketplace.

Entrepreneurship - ilearnlot

  • Why To Be a Best Leader become First Be a Great Follower?

    Why To Be a Best Leader become First Be a Great Follower?

    Why To Be a Best Leader become, First Be a Great Follower?

    To differentiate leader from follower is difficult; they have several similarities as well as also have some differences. In leadership, one should have to take risk and lead the team; have ability to see opportunity that other cannot see. Both should be able to learn from someone or something. Leaders must be independent and isolated and should not rely on anyone but himself and have to be entrepreneurial, and make workplace culture better by working with generous purpose. So Now talking about, Why To Be a Best Leader become First Be a Great Follower?

    Good leadership is needed to solve problems and to navigate unexpected circumstances Followers only need to be competent during the battle and must be able to carry out orders by their leader, with their own ability while at other times; they have no need to be that competent. They could ask for help from their friends but in contrast, Leader cannot ask for help from his followers or else his followers would consider him incompetent. Being a follower is easier than being a leader because leader has to be isolated and should have ability to solve his own problems.

    Leadership can be as successful or effective or both

    • Successful leadership but not effective: In this pattern, leader’s style may not compatible; but follower does the job because of leader’s power and position. They obey the command and follow his idea.
    • Effective leadership: the followers may do the job willingly to cooperate because the leader’s request satisfies the follower’s needs or goal.
    • Successful leadership: it emphasizes upon position, power and close supervision.

    Characteristics of Good Followers

    As leader, it is very important to know about that how to follow and how to lead. Many people believe that if you want to become a good leader then you must be a good follower.

    Some characteristic about good follower:

    • Well finisher: Good followers always concentrate on their task and complete their task according to preplanned.
    • Clear vision: they understand their power and position and it is equally important to understand their role as a leader.
    • Loyalty: Good followers always try to avoid telling bad things about their boss/leader in public. It does not means that they are completely agree with their boss/leader but only do not want to do things in public because to influence the public it is needed to become public loyal.
    • Good followers are obedient enough and humble.
    • Awareness of surrounding: Good follower is well aware of surrounding situations and people. They always try to learn about people behavior and their thinking and how they affect in his work and what is going wrong and then make changes according to demands.
    • Own thinking: To becomes a good follower, you are able to think on your own and decide what is right and what is wrong. Good followers always take side to leader and support them when they are doing right.

    A Great Leader as a Good Follower

    Many qualities are same between leaders and followers. A great leader follows the same trait as followers do but change their style and do some modification in it. Great leader knows their boundary and limitation very well.

    Good leadership is the golden key to get best performance. Need to imply your own clear sets of values and belief and also have to make clear vision for all. Develop some creative ideas for the organization to make changes and reach up to desire goal. From this perspective, leaders are always try that people follow the process and in this way leader always think themselves as a follower.

    There is very important reason to leaders that they have to follow because no one can do it alone and have to create and utilize the energy, ideas and full potential of everyone.

    Leadership requires a close study of human behavior. It is the people who are the factors of importance. There are many different points of view about leadership. One belief is that leadership has to be taught while some are of the view that leaders can’t be made by teaching or training. New Roles of Human Resource Management in Business Development.

    In this modern age, new leaders are coming but most of them fail to cultivate their inner strength, ability to guide the people, to lead the people. There are three basic steps which are followed mostly in the process of training. Information is the first step, gets from simple reading and continuous study which then converted into knowledge.

    Wisdom is the transformation of knowledge. Trained person has to be able to transfer the knowledge into the practice. As a result of training, one should become more self-confident. On receiving training, knowledgeable person becomes capable of taking his own decisions and at this stage; person visualizes the truth-real understanding.

    There are few requirements to reach to the truth, in ascending direction that are desire to learn, listening to the teacher, learning, retention, understanding, reflection, rejection of false views and truth.

    Human relationship gains the most attraction for a leader for the obvious reasons that the leader leads people. For any business, workforce is the basic requirement and for accomplishment leader has to understand people.

    Common logic reason behind the successful leader is the development of proper appreciation human nature. For this, one should have enough confidence and has to explain to other members about task and targets and how that can be accomplished.

    Leader should also explain the subordinates about their position and also impact of success or failure on the ultimate goal. If the goal achieved, that is a success of team not a success of leader alone. Leadership Explained by the Internet.

    The leader has to do the required morale boosting apart from handling the work and must to be in touch with his people. It is necessary to show adequate interest in their personal problems. It is better for his people must perceive as their leader becomes the real guardian of their interests.

    This is necessity to do this as it helps to maintain respective distance from the people. This concept of distant has been mostly appreciated, and understood by successful leader.

    Thus, taking an overall view, the leader has to be a dynamic person and should have capability to turn the adversity in his favors and to gain this. The leader must have the capacity to concentrate, and focus attention on the goal with an aptitude to take timely decisions and have to be sincere in his dealing. He has to show his faithfulness and loyalty towards his mission and the people, and should possess a fair knowledge of his job and profession. Be The Change You Want to See in The World.

    Why To Be a Best Leader become First Be a Great Follower

    So what does a great follower look like? I would suggest great followers share at least five characteristics:

    • They are clear: They understand their role, You can’t be a good follower unless you have clearly identified the leader. While you may be a leader in your own realm, everyone has a boss including you. Great followers not only accept this fact, they embrace it.
    • They are obedient: While obedience may be a politically incorrect concept, it is essential for organizational effectiveness. No one should be allowed to give orders who can’t obey orders. This is how great leaders model the standards of acceptable behavior to their own followers.
    • They are servants: This is crucial, Great followers are observant. They notice what needs to be done to help the leader accomplish his or her goals. Then they do it joyfully, without grumbling or complaining.
    • They are humble: Great followers don’t make it about them, he/she also to be humble, shine the light on the leader, make their own boss look good especially in front of his or her boss.
    • They are loyal: I have written on this before, Great followers never speak ill of their boss in public. This doesn’t mean they can’t disagree or even criticize. “Yes” people aren’t very helpful in the long run. It just means that they don’t do it in public. Great followers understand that public loyalty leads to private influence.

    Many Thinks, Why To Be a Best Leader become First Be a Great Follower?

    The Mark Zuckerberg’s of this world corporate leaders propelled into their positions because of what they created are few and far between. Most leaders start in much humbler, entry-level positions and work their way up the corporate ladder, and this is a good thing. Emerging leaders who work their way up learn about what motivates them and their co-workers. They also learn about what makes a team work well together to achieve goals. They also learn what good and not so good leadership is, and this allows them to develop empathy and compassion for those they will one day lead. In essence, they learn key “follower-ship” lessons that will serve them well when they become leaders.

    According to Barbara Kellerman, a leadership lecturer at Harvard University, there is a lot a person can learn about being a good leader by being a good follower. Good followers, she says, are passionately committed and deeply involved. They actively support a good leader (one who is effective and ethical). Do Good Always! Bad followers, on the other hand, do nothing to contribute to the group or the organization.

    Good followers learn to “read” their colleagues, co-workers, customers, and other audiences. They understand what motivates them and what upsets them, skills that they can use when they become leaders. Good followers also learn important diplomacy skills, like the ability to get along well with others while not ignoring differences for example, working well with a colleague who has different political beliefs. Good followers also need to learn to be courageous. Kellerman notes that good followers can aid the leader when he or she is doing the right thing but they also have to have the courage to stand up to the leader if he or she is doing something wrong (Moran, 2014).

    Good followers also learn important collaboration skills that will serve them well as leaders-Good followers and good leaders understand that followers (good and bad) can make or break a leader by influencing how and what goals get achieved-Good followers will assist their leaders in achieving goals. Bad followers can actively sabotage the achievement of goals (Moran, 2014). Good followers also learn to think for themselves and will stand up to a leader who may be heading in the wrong direction (Moran, 2014).

    Being a good follower does not end when one becomes a leader. It is important that emerging leaders understand that they must continue to practice good follower-ship in their leadership roles; they become good follower-ship leaders. During a keynote speech in 2012, former HP executive vice president Vyomesh Joshi said the key to being a great leader was to practice good follower-ship. In other words, leaders who have been good followers and who practice good follower-ship principles as leaders understand how to work with people to bring out the best in them.

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  • Meaning and Essence of Leadership in the Business

    Meaning and Essence of Leadership in the Business

    The Meaning and Essence of Leadership in the Business

    Leadership is a process of influencing the behavior of other people to work willingly towards the achievement of organizational goals. It involves existence of a leader and followers. So leadership is an exercise to influence the behavior of the followers towards attainment/achievement of specified goals. Here the person who guides or directs his followers is known as leader.

    Leadership is a process of influence: Leadership is a process whose important ingredient is the influence exercised by the leader on group members. A person is said to have an influence over others when they are willing to carry out his wishes and accept his advice, guidance and direction. Successful leaders are able to influence the behavior, attitudes and beliefs of their followers.

    Leadership is the function of stimulation: Leadership is the function of motivating people to strive willingly to attain organizational objectives. Leaders are considered successful when they are able to subordinate the individual interests of the employees to the general interests of the organization. A successful leader guides his subordinates to have their individual goals set by themselves in such a way that they do not conflict with the organizational objectives. When this congruency is achieved, workers act enthusiastically to achieve these goals.

    Leadership gives an experience of helping attain the common objectives: Under successful leadership, every person in the organization feels that his operation, however minor it may be, is vital to the attainment of organizational objectives. It happens when the manager feels the importance of individuals, gives them recognition and tells them about the importance of activities performed by them.

    Employees must be satisfied with the type of leadership provided: Only short-term productivity of employees can be increased by pressure and punishment. This approach is not in the long-term interests of the organization. Force generates counter force, which results in a decreased long-term productivity. Long-term interests of the organization are best served when managers allow subordinates to influence their behavior, particularly when subordinates are knowledgeable and competent. A good manager recognizes the fact that leadership is a shared function. A good leader shares everything with his followers; he shares credit, he shares blame, he shares ideas, opinion and experience.

    Leadership is related to a situation: When we talk of leadership, it is always related to a particular situation, at a given point of time and under a specific set of circumstances. That means leadership styles should be different under different circumstances. At one point of time, the subordinates may accept the autocratic behavior of the leader while at a different point of time and under a different set of circumstance, only participative leadership style may be successful. That is why, it is said that leadership is always particular and not general.

    Meaning and Essence of Leadership in the Business! Change is the only unchanging features in this changing world. Everything surrounding us changes with the passage of time to be in line with modernization. The ongoing business environment is no exception when it comes to this trend. Modern business is on a triumphant march through tracking changes via hard work from the most efficient business leaders. New Roles of Human Resource Management in Business Development.

    Effective leaders adopt strategies and techniques to try to win or take the lead in the competitive market, which is ultimately a game of “survival of the fittest.” In both good and bad times, there is always a need for quality leadership. The success of a business or an industry is mostly dependent on the leaders it gets or inherits. The successful implementation of desired leadership techniques is crucial for meeting the changing demands in business. The mystique of leadership in and of itself makes it one of the most widely debated, studied and sought-after commodities in business.

    The Meaning of Leadership

    Leadership is the social process of influencing the behaviors of others without posing any threats of violence. It is a process of influencing the thoughts, attitudes and behaviors of others by setting a direction that helps visualize what they can hope to achieve or what lies ahead for them. It’s the capability of getting other people to do something significant through harnessing their efforts jointly. Be The Change You Want to See in The World.

    Leadership in a very ordinary sense refers to creating a group of followers whom another individual leads. Merely accompanying a group of people isn’t leadership unless the person actually is choosing and showing a direction to the followers. Be Your Extraordinary Self, Without followers a leader isn’t a leader in spite of having the desired qualities or nature of a leader.

    The Essence of Leadership in Business

    The nature of business leadership is both a complex and compelling phenomenon. Many discussions of leadership confuse personality, important objectives, formal position and specific behaviors with acts of leadership. It may involve certain characteristics, but leadership is not confined to these characteristics; rather, it’s all about influencing others in a substantial way.

    Whether the setting is a business, a government, an educational institution or in an athletic setting, most people would agree that having a good leader is desirable. A good leader is someone like a good physician. Just as the physician must identify the patient’s disease accurately to ensure the effectiveness of the prescribed treatment, the business leader must also be able to diagnose problems, values and voices while finding effective solutions.

    In leadership you push past the average expectations by carrying a sense of mission, motivating, learning and inspiring new ways of thinking. This is known as transformational leadership. It emerges as the most updated and diversified techniques in the field of leadership theory and practices to boost workforce competency and performance.

    Leadership and Management in Business

    True leadership in business is a subtle quality, and thus we often confuse management duties with personal style with leadership. Management and leadership are related, but they are not the same. You can be a manager or a leader; you can also be both or neither. The biggest difference between managers and leaders lies in the way they motivate others. When executing plans as a manager, you focus on supervising results, comparing them with goals and correcting deviations. In contrast, as a leader you focus on energizing people to overcome hurdles in reaching goals. Effective leaders hunt pressing issues such as influence, power, dependence, and policies for change. Roles of HR Management in Organizations on Difficult Times.

    Power, achievement and affiliation shape the basic human needs and are acquired over time to result in legitimate reward, coercive, referent and expert powers in business issues affecting leadership behaviors. If as a leader you have a high need for institutional power rather than personal power, you may be more effective. Personal power can be transformed into leadership abilities through the adoption of different approaches to leadership and adjusting your perspective of what the meaning of “power” is.

    What we must remember when trying to expand and embrace the idea of being a leader ourselves is that leadership encompasses the field of a widely discussed phenomenon in the business world. A leader overnight is not made, created or born. The growing influence of global culture and workforce diversity makes the task of being an effective leader that much more challenging. In a very simple and straightforward manner, leadership is all about energizing people toward a specific goal. The theoretical and practical knowledge regarding leadership may facilitate you to implement perfect leadership strategies in business development and activities which you can then embrace using the required adaptability and emotional intelligence to succeed as a business leader.

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  • Mission Statement

    Mission Statement

    What is Mission Statement?

    A mission statement is a short statement of an organization’s purpose, identifying the scope of its operations: what kind of product or service it provides, its primary customers or market, and its geographical region of operation. It may include a short statement of such fundamental matters as the organization’s values or philosophies, a business’s main competitive advantages, or a desired future state the “vision”.

    A mission statement is not simply a description of an organization by an external party, but an expression, made by its leaders, of their desires and intent for the organization. The purpose of a mission statement is to focus and direct the organization itself. It communicates primarily to the people who make up the organization its members or employees giving them a shared understanding of the organization’s intended direction. Organizations normally do not change their mission statements over time, since they define their continuous, ongoing purpose and focus.

    According to Chris Bart, professor of strategy and governance at McMaster University, a commercial mission statement consists of three essential components:

    Key Market: Who is your target client or customer (generalize if needed)?

    Contribution: What product or service do you provide to that client?

    Distinction: What makes your product or service unique, so that the client would choose you?

    Bart estimates that in practice, only about ten percent of mission statements say something meaningful. For this reason, they are widely regarded with contempt.

    The next step is to prepare mission statements. If the vision is “WHAT” of life, then the mission is “WHY” and “HOW”. It identifies the roles and activities to which an individual is committed and provides the overall direction for achieving the vision. Mission focuses on what you want to be and what you want to do- contributions and achievements. Mission focuses on the values and principles upon which being and doing are based. A personal vision needs to be clearly developed so that the mission statement can be based on it.

    I. These statements should clearly indicate the important roles and methodologies followed for fulfilling the vision.

    II. Techniques and tools such as affinity diagram, brainstorming, fish-bone diagram, and surveys should be used.

    III. Mission statements should realize the vision in action. Conduct a mind map to check whether it is really fulfilled.

    IV. These statements will carry the information which needs to be fulfilled in the near future.

    V. Time factor may be brought in to make it more systematic.

    Mission statements are prepared to make the employees understand in clear terms “HOW” to achieve the vision and “WHY” all this has to be done. It is a ROAD MAP for achieving the vision. The mission statements act as a guiding force encouraging the individuals to work towards reaching the vision.

    What is Purpose of Mission statement?

    The sole purpose of a mission statement is to serve as your company’s goal/agenda, it outlines clearly what the goal of the company is. Some generic examples of mission statements would be, “To provide the best service possible within the banking sector for our customers.” or “To provide the best experience for all of our customers.” The reason why businesses make use of mission statements is to make it clear what they look to achieve as an organization, not only for themselves and their employees but to the customers and other people who are a part of the business, such as shareholders. As a company evolves, so will their mission statement, this is to make sure that the company remains on track and to ensure that the mission statement does not lose its touch and become boring or stale.

    North American magazine and website that carries news stories about entrepreneurship, small business management, and business, Entrepreneur explains the purpose of a mission statement as the following:

    “The mission statement reflects every facet of your business: the range and nature of the products you offer, pricing, quality, service, marketplace position, growth potential, use of technology, and your relationships with your customers, employees, suppliers, competitors and the community.”

    It is important that a mission statement is not confused with a vision statement. As discussed earlier, the main purpose of a mission statement is to get across the ambitions of an organization in a short and simple fashion, it is not necessary to go into detail for the mission statement which is evident in examples given. The reason why it is important that a mission statement and vision statement are not confused is because they both serve different purposes. Vision statements tend to be more related to strategic planning and lean more towards discussing where a company aims to be in the future.

    Here are what business leaders say a mission statement should do for a company:

    “A good vision or mission statement will fill a few roles: It will be toothy enough to engage the media, analysts and other industry watchers. It will be aspirational enough to give employees something to reach for and bind them together in their day-to-day work. And it will be clear and specific enough to build the brand and affect public perception of the company. In an ideal world, it will even give your customers a sense that they’re buying into your vision when they purchase one of your products.” by Kyle Monson, a partner at Knock Twice hybrid creative agency.

    “A company’s mission statement is the cornerstone on which it is built. Its strategic plan and its culture are directly tied to the vision the mission statement puts forth. It is important that a mission statement supports the overarching goals and purpose of the company and explain why you exist as a business in a way that can be understood internally within the company and externally to consumers.” by Gerry David, president, and CEO of healthy lifestyle company Celsius Holdings.

    “Creating a mission statement takes time and a lot of decision making. It lays down expectations for how your customers and employees will interact with one another, so take your time with it. Clearly, write down your vision of the company and ask yourself, ‘What am I trying to accomplish?’ Think about how you want others to perceive your company, what’s important to you and your organization, and then prioritize it. Most importantly, make sure it’s clear, concise and easy for anyone to understand.” by Bobby Harris, president, and CEO of Blue Grace Logistics.

  • Library and Internet Research

    Understanding and Using the Library and Internet Research

    What is Library? A library is a collection of sources of information and similar resources, made accessible to a defined community for reference or borrowing. It provides physical or digital access to material and may be a physical building or room, or a virtual space, or both. A library’s collection can include books, periodicals, newspapers, manuscripts, films, maps, prints, documents, micro-form, CDs, cassettes, videotapes, DVDs, Blu-ray Discs, e-books, audio-books, databases, and other formats. Libraries range in size from a few shelves of books to several million items.

    What is Internet Research? Internet research has had a profound impact on the way ideas are formed and knowledge is created. Common applications of Internet research include personal research on a particular subject (something mentioned on the news, a health problem, etc.), students doing research for academic projects and papers, and journalists and other writers researching stories.

    Research is a broad term. Here, it is used to mean “looking something up (on the Web)”. It includes any activity where a topic is identified, and an effort is made to actively gather information for the purpose of furthering understanding. It may include some post-collection analysis like a concern for quality or synthesis.

    A third approach to generate new business ideas is to conduct library and Internet research. A natural tendency is to think that an idea should be chosen, and the process of researching the idea should then begin. This approach is too linear. Often, the best ideas emerge when the general notion of an idea, like creating casual electronic games for adults, is merged with extensive library and Internet research, which might provide insights into the best type of casual games to create.

    Libraries are often an underutilized source of information for generating business ideas. The best approach to utilizing a library is to discuss your general area of interest with a reference librarian, who can point out useful resources, such as industry-specific magazines, trade journals, and industry reports. Simply browsing through several issues of a trade journal on a topic can spark new ideas. Very powerful search engines and databases are also available through university and large public libraries, which would cost hundreds or thousands of dollars to access on your own. An example is IBIS World (www.ibisworld.com), a company that publishes market research on all major industries and subcategories within industries. IBIS World published a 30-page report on the solar power industry, for example, in March 2011, which includes key statistics (about industry growth and profitability), a complete industry analysis, and an outlook for the future. Spending time reading this report could spark new ideas for solar powered devices or help affirm an existing idea.

    Internet research is also important. If you are starting from scratch, simply typing “new business ideas” into Google or Yahoo! will produce links to newspaper and magazine articles about the “hottest” and “latest” new business ideas. Although these types of articles are general in nature, they represent a starting point if you’re trying to generate new business ideas from scratch. If you have a specific idea in mind, a useful technique is to set up a Google or Yahoo! “e-mail alert” using keywords that pertain to your topic of interest. Google and Yahoo! alerts are e-mail updates of the latest Google or Yahoo! results including press releases, news articles, and blog posts based on your topic. This technique, which is available for free, will feed you a daily stream of news articles and Blog postings about specific topics. Another approach is to follow business leaders and experts in the industries you’re interested in on Twitter. The best way to locate people on Twitter you might be interested in following is by typing into the search bar labeled “Who to Follow” relevant keywords preceded by the “#” sign. For example, if you’re interested in solar power, type “#solar power” into the search bar. All the results will be people or companies who tweet about solar power topics.

    Once an entrepreneur has an idea, it often needs to be shaped and fine-tuned. One way to do this, in conjunction with the suggestions made previously, is to enlist a mentor to help. An explanation of how to use a mentor in this regard, and where mentors can be found, is described in the “Partnering for Success” feature.

    Library VS Internet Research

    Many people are confused about what constitutes library research versus what constitutes Internet research. Some people argue that effective research is never conducted on the Internet, that one needs access to the resources of a library to conduct thorough investigations. People in this camp argue that institutional libraries pay significant sums to provide access to proprietary databases to their customers that is, databases that offer abstracts, bibliographical information, and, oftentimes, full texts of articles published in scholarly journals. Also, research purists may argue that documents published on the Internet lack the authority of research that is peer-reviewed and published by major publishers. Something important to consider is the difference between an Internet resource and an academic resource accessed via the Internet. For example, if I simply Google “research method,” one of my first search results is from about.com – a good resource, but not necessarily an academic resource. Although I can glean about.com for useful information about the generics of a topic like “research methods,” for the purposes of an academic research assignment, it may be wise to use the Internet to access my library’s databases (like Academic Search Premier, JSTOR, etc.) for online access to a plethora of information pertaining to my search term. The Internet hosts a variety of resources, some of which are useful for casual, everyday references (like about.com) and others which are more appropriate for an academic research assignment (like my library’s databases: Academic Search Premier, JSTOR, etc.)

    Because of a misunderstanding about the way in which the Internet serves both purposes (casual, everyday research and formal, academic research) some students report they never use their library’s resources. Studies of the research processes of students have found that many students limit their investigations to search engines such as Google, paying especially close attention to the first eight or so hits on any search. Unfortunately, students who conduct research in this way often end up with sources that they later realize aren’t useful in crafting informed, thorough, formal academic research and/or arguments.

    To conduct effective research, you may need to use both the library and the Internet. Limiting yourself to the library cuts off some very innovative work that may not yet be accessible for your library’s periodical indexes and abstracts. In turn, relying solely on the Internet is like trying to dig a hole with your tongue rather than a shovel: extremely counterproductive and a waste of time.

    Information junkies know arguments for using either the library or the Internet are out of touch with reality. As research libraries increase the number of electronic resources they subscribe to, many traditional resources are now accessible via the Internet although passwords may be required. In other words, distinctions between the library and the Web are blurring.

  • Brainstorming

    What is Brainstorming?

    Meaning of Brainstorming: “Brainstorming is a group creativity technique by which efforts are made to find a conclusion for a specific problem by gathering a list of ideas spontaneously contributed by its members.”

    Definition of Brainstorming

    Process for generating creative ideas and solutions through intensive and freewheeling group discussion. Every participant is encouraged to think aloud and suggests as many ideas as possible, no matter seemingly how outlandish or bizarre. Analysis, discussion, or criticism of the aired ideas is allowed only when the brainstorming session is over and evaluation session begins. See also lateral thinking and nominal group technique.

    A common way to generate new business ideas is through brainstorming. In general, brainstorming is simply the process of generating several ideas about a specific topic. The approaches range from a person sitting down with a yellow legal pad and jotting down interesting business ideas to formal “brainstorming sessions” led by moderators that involve a group of people.

    In a formal brainstorming session, the leader of the group asks the participants to share their ideas. One person shares an idea, another person reacts to it, another person reacts to the reaction, and so on. A flip chart or an electronic white-board is typically used to record all the ideas. A productive session is freewheeling and lively. The session is not used for analysis or decision making the ideas generated during a brainstorming session need to be filtered and analyzed, but this is done later. Show the four strict rules for conducting a formal brainstorming session. As you’ll see, the number one rule for a brainstorming session is that no criticism is allowed, including chuckles, raised eyebrows, or facial expressions that express skepticism or doubt. Criticism stymies creativity and inhibits the free flow of ideas.

    Formal Brainstorming Session

    I. No criticism is allowed, including chuckles, raised eyebrows, or facial expressions that express skepticism or doubt. Criticism stymies creativity and inhibits the free flow of ideas.
    II. Freewheeling, which is the carefree expression of ideas free from rules or restraints, is encouraged; the more ideas, the better. Even crazy or outlandish ideas may lead to a good idea or a solution to a problem.
    III. The session moves quickly, and nothing is permitted to slow down its pace. For example, it is more important to capture the essence of an idea than to take the time to write it down neatly.
    IV. Leapfrogging is encouraged. This means using one idea as a means of jumping forward quickly to other ideas.

    Brainstorming sessions dedicated to generating new business ideas are often less formal. For example, as described in more detail in Case 11.2, during the creation of Proactiv, a popular acne treatment product, Dr. Katie Rodan, one of the company’s founders, hosted dinner parties at her house and conducted brainstorming sessions with guests. The guests included business executives, market researchers, marketing consultants, an FDA regulatory attorney, and others. Rodan credits this group with helping her and her co-founder brainstorm a number of ideas that helped shape Proactiv and move the process of starting the company forward. Similarly, Sharelle Klause, the founder of Dry Soda, a company that makes an all-natural soda that’s paired with food the way wine is in upscale restaurants, tested her idea by first talking to her husband’s colleagues, who were in the food industry, and then tapped into the professional network of a friend who owned a bottled water company. Through the process, she met a chemist, who was instrumental in helping her develop the initial recipes for her beverage. Klause also went directly to restaurant owners and chefs to ask them to sample early versions of her product. While this approach only loosely fits the definition of brainstorming, the spirit is the same. Klause was bouncing ideas and early prototypes of her product off others to get their reactions and generate additional ideas. DRY Soda is the subject of Case 9.1.

    Approaches to brainstorming are only limited by a person’s imagination. For example, to teach her students an approach to utilizing brainstorming to generate business ideas, Professor Marcene Sonneborn, an adjunct professor at the Whitman School of Management Syracuse University, uses a tool she developed called the “bug report” to help students brainstorm business ideas. She instructs her students to list 75 things that “bug” them in their everyday lives. The number 75 was chosen because it forces students to go beyond thinking about obvious things that bug them (campus parking, roommates, scraping snow off their windshields in the winter), and think more deeply. On occasions, students actually hold focus groups with their friends to brainstorm ideas and fill out their lists.

  • Focus Groups

    What is Focus Groups?

    A focus group is small, but the demographically diverse group of people whose reactions are studied especially in market research or political analysis in guided or open discussions about a new product or something else to determine the reactions that can be expected from a larger population. It is a form of qualitative research consisting of interviews in which a group of people is asked about their perceptions, opinions, beliefs, and attitudes towards a product, service, concept, advertisement, idea, or packaging. Questions are asked in an interactive group setting where participants are free to talk with other group members. During this process, the researcher either takes notes or records the vital points he or she is getting from the group. Researchers should select members of the focus group carefully for effective and authoritative responses.

    Define of Focus Groups

    “A group of people assembled to participate in a discussion about a product before it is launched, or to provide feedback on a political campaign, television series, etc.”

    Definitions of Focus Groups

    Market research: Small number of people (usually between 4 and 15, but typically 8) brought together with a moderator to focus on a specific product or topic. Focus groups aim at a discussion instead of on individual responses to formal questions and produce qualitative data (preferences and beliefs) that may or may not be representative of the general population.

    Problem-solving: Idea generation or forecasting technique where several experts or informed individuals share their point of view on a specific topic or problem.

    A focus group is a gathering of 5 to 10 people who are selected because of their relationship to the issue being discussed. Although focus groups are used for a variety of purposes, they can be used to help generate new business ideas.

    Focus groups typically involve a group of people who are familiar with a topic, are brought together to respond to questions, and shed light on an issue through the give-and-take nature of a group discussion. Focus groups usually work best as a follow-up to brainstorming, when the general idea for a business has been formulated, such as casual electronic games for adults, but further refinement of the idea is needed. Usually, focus groups are conducted by trained moderators. The moderator’s primary goals are to keep the group “focused” and to generate lively discussion. Much of the effectiveness of a focus group session depends on the moderator’s ability to ask questions and keep the discussion on track. For example, a retail establishment in which coffee is sold, such as Starbucks, might conduct a focus group consisting of 7 to 10 frequent customers and ask the group, “What is it that you don’t like about our coffee shop?” A customer may say, “You sell 1-pound bags of your specialty ground coffees for people to brew at home. That’s okay, but I often run out of the coffee in just a few days. Sometimes it’s a week before I get back to the shop to buy another bag. If you sold 3-pound or 5-pound bags, I’d actually use more coffee because I wouldn’t run out so often. I guess I could buy two or three 1-pound bags at the same time, but that gets a little pricey. I’d buy a 3- or 5-pound bag, however, if you’d discount your price a little for larger quantities.” The moderator may then ask the group, “How many people here would buy 3-pound or 5-pound bags of our coffee if they were available?” If five hands shoot up, the coffee shop may have just uncovered an idea for a new product line.

    Some companies utilize hybrid focus group methodologies to achieve specific insights and goals. An example is “college drop-ins.” This approach involves paying college students to host a party at their campus and providing them a budget to buy food and snacks. During the party, the hosts interview and videotape other students about specific market issues. Everything is up-front—the partygoers are told that the information is being collected for a market research firm (on behalf of a client).

    History of Focus Groups

    Focus groups have a long history and were used during the Second World War (1939-1945) to examine the effectiveness of propaganda. Associate director sociologist Robert K. Merton set up focus groups at the Bureau of Applied Social Research in the USA prior to 1976. Psychologist and marketing expert Ernest Dichter coined the term “focus group” itself before his death in 1991.

  • The Creative Process

    The Creative Process

    Creativity is a phenomenon whereby something new and somehow valuable is formed. The created item may be intangible (such as an idea, a scientific theory, a musical composition, or a joke) or a physical object (such as an invention, a literary work, or a painting).

    Scholarly interest in creativity involves many definitions and concepts pertaining to a number of disciplines: engineering, psychology, cognitive science, education, philosophy (particularly philosophy of science), technology, theology, sociology, linguistics, business studies, songwriting, and economics, covering the relations between creativity and general intelligence, mental and neurological processes, personality type and creative ability, creativity and mental health; the potential for fostering creativity through education and training, especially as augmented by technology; the maximization of creativity for national economic benefit, and the application of creative resources to improve the effectiveness of teaching and learning.

    The Creative process can be broken into stages:

    Preparation

    This is the first phase, which most people call “work.” A writer, for example, prepares by writing, by reading, or by revising earlier work. A musician plays scales, chords, or songs; a painter messes with paints or visits an art gallery; an entrepreneur researches problems to solve; a programmer plays with code. In each example, the creative is going through relatively mundane processes.

    The reason I say most people call this phase “work” is that these processes may or may not be inherently enjoyable. They’re also fairly mundane and tedious, but the creative has learned that this process is necessary to plant the seeds that lead to…Preparation is the background, experience, and knowledge that an entrepreneur brings to the opportunity recognition process. Just as an athlete must practice to excel, an entrepreneur needs the experience to spot opportunities. Over time, the results of research suggest that as much as 50 to 90 percent of start-up ideas emerge from a person’s prior work experience.

    Incubation

    Incubation is the stage during which a person considers an idea or thinks about a problem; it is the “mulling things over” phase. Sometimes incubation is a conscious activity, and sometimes it is unconscious and occurs while a person is engaged in another activity. One writer characterized this phenomenon by saying that “ideas churn around below the threshold of consciousness.”

    This would be the mystical process if there were one, because you often don’t know that you’re incubating an idea, or if you do know you’re working on one, you don’t know when it’s going to come out. It’s during this phase that your conscious and subconscious minds are working on the idea, making new connections, separating out unnecessary ideas, and grabbing for other ideas.

    This is the phase that most people mess up the most with distractions and the hustle and bustle of daily lives. Modern life, with its many beeps, buzzes, and distractions, has the strong tendency to grab the attention of both our subconscious and our unconscious mind, and as result, the creative process stops and is instead replaced by more immediate concerns.

    Insight

    Insight is the flash of recognition when the solution to a problem is seen or an idea is born. It is sometimes called the “eureka” experience. In a business context, this is the moment an entrepreneur recognizes an opportunity. Sometimes this experience pushes the process forward, and sometimes it prompts an individual to return to the preparation stage. For example, an entrepreneur may recognize the potential for an opportunity but may feel that more knowledge and thought is required before pursuing it.

    Evaluation

    Evaluation is the stage of the creative process during which an idea is subjected to scrutiny and analyzed for its viability. Many entrepreneurs mistakenly skip this step and try to implement an idea before they’ve made sure it is viable. Evaluation is a particularly challenging stage of the creative process because it requires an entrepreneur to take a candid look at the viability of an idea.

    Elaboration

    Elaboration is the stage during which the creative idea is put into a final form: The details are worked out and the idea is transformed into something of value, such as a new product, service, or business concept. In the case of a new business, this is the point at which a business plan is written.

    Illumination

    This is the “Eureka” moment that many of us spend our days questing after. When it hits, the creative urge is so incredibly strong that we lose track of what else is happening. The driving impulse is to get whatever is going on in our heads down into whatever medium it’s intended for.

    The most frustrating thing for me is that the “illumination” moments happen at the most inopportune times. They invariably happen when I’m in the shower when I’m driving by myself, when I’m working out, or when I’m sitting in mind-numbing meetings that I can’t get out of. Of course, the bad part is as I said above: the impulse is to get the idea out as soon as possible, so it’s not at all uncommon for me to stop showering, driving, or working out and run to the nearest notepad – and, in meetings, I start purging immediately anyway. I’ve yet to gain enough clout to excuse myself from the meetings, but I’m working on it.

    I was speaking to a friend a few weeks ago, and I told her I was frustrated because I was pregnant with ideas and didn’t have time to get them out. Keeping with the analogy, when a Eureka! moment hits, it’s much like labor – you’re done with incubating, and it’s time for…

    Implementation

    This phase is the one in which the idea you’ve been preparing and incubating sees the light of day. It’s when that written piece comes out, when that song flows when that canvas reveals its painting, and so on. It’s also when a good creative starts to evaluate the idea and determine whether it’s good or not – but only after they have enough to see where it’s going.

    Most of the creative I know or work with get really frustrated with others during this phase. Other people only see the creation at the end, and they don’t recognize or care much about the process that generated that idea. This is especially true with some supervisors and bosses who expect the end product on a certain schedule, even though the creative process does not work that way. Creative know that for every good idea, there are at least a few that don’t work out, but they can’t know ahead of time what’s going to work out and what won’t.

    The creative process begins with work and ends with work. The takeaway point here is that creativity is not just percolating and Eureka: it’s percolating and Eureka sandwiched between work phases.

  • Successful Characteristics of Entrepreneur

    Successful Characteristics of Entrepreneur

    Have you ever thought about striking out on your own? After all, being your own boss can be an exciting prospect. However, owning a business isn’t for everyone. To be a successful entrepreneur, you must have or develop certain personality traits. Here are nine characteristics you should ideally possess to start and run your own business:

    I. Motivation: Entrepreneurs are enthusiastic, optimistic and future-oriented. They believe they’ll be successful and are willing to risk their resources in pursuit of profit. They have high energy levels and are sometimes impatient. They are always thinking about their business and how to increase their market share. Are you self-motivated enough to do this, and can you stay motivated for extended periods of time? Can you bounce back in the face of challenges?

    Meaning of Motivation is a theoretical construct used to explain behavior. It gives the reason for people’s actions, desires, and needs. Motivation can also be defined as one’s direction to behavior, or what causes a person to want to repeat a behavior and vice versa. A motive is what prompts the person to act in a certain way, or at least develop an inclination for specific behavior. According to Maehr and Meyer, “Motivation is a word that is part of the popular culture as few other psychological concepts are.”

    II. Creativity and Persuasiveness: Successful entrepreneurs have the creative capacity to recognize and pursue opportunities. They possess strong selling skills and are both persuasive and persistent. Are you willing to promote your business tirelessly and look for new ways to get the word out about your product or service? Meaning of Creativity is a phenomenon whereby something new and somehow valuable is formed. The created item may be intangible (such as an idea, a scientific theory, a musical composition, or a joke) or a physical object (such as an invention, a literary work, or a painting).

    III. Versatility: Company workers can usually rely on a staff or colleagues to provide service or support. As an entrepreneur, you’ll typically start out as a “Solo-entrepreneur,” meaning you will be on your own for a while. You may not have the luxury of hiring a support staff initially. Therefore, you will end up wearing several different hats, including secretary, bookkeeper and so on. You need to be mentally prepared to take on all these tasks at the beginning. Can you do that? Meaning of Versatility; ability to adapt or be adapted to many different functions or activities.

    IV. Superb Business Skills: Entrepreneurs are naturally capable of setting up the internal systems, procedures and processes necessary to operate a business. They are focused on cash flow, sales and revenue at all times. Successful entrepreneurs rely on their business skills, know-how and contacts. Evaluate your current talents and professional network. Will your skills, contacts and experience readily transfer to the business idea you want to pursue?

    V. Risk Tolerance: Launching any entrepreneurial venture is risky. Are you willing to assume that risk? You can reduce your risk by thoroughly researching your business concept, industry and market. You can also test your concept on a small scale. Can you get a letter of intent from prospective customers to purchase? If so, do you think customers would actually go through with their transaction?

    VI. Drive: As an entrepreneur, you are in the driver’s seat, so you must be proactive in your approaches to everything. Are you a doer — someone willing to take the reins — or would you rather someone else do things for you? Meaning of Drive; operate and control the direction and speed of a motor vehicle. Propel or carry along by force in a specified direction.

    VII. Vision: One of your responsibilities as founder and head of your company is deciding where your business should go. That requires vision. Without it, your boat will be lost at sea. Are you the type of person who looks ahead and can see the big picture? Meaning of Vision; the faculty or state of being able to see. The ability to think about or plan the future with imagination or wisdom. An experience of seeing someone or something in a dream or trance, or as a supernatural apparition.

    VIII. Flexibility and Open-Mindedness: While entrepreneurs need a steadfast vision and direction, they will face a lot of unknowns. You will need to be ready to tweak any initial plans and strategies. New and better ways of doing things may come along as well. Can you be open-minded and flexible in the face of change? Definition of Flexibility; The quality of bending easily without breaking.

    IX. Decisiveness: As an entrepreneur, you won’t have room for procrastination or indecision. Not only will these traits stall progress, but they can also cause you to miss crucial opportunities that could move you toward success. Can you make decisions quickly and seize the moment? Definition of Decisiveness; The ability to make decisions quickly and effectively. the conclusive nature of an issue that has been settled or a result that has been produced.

  • Personal Characteristics of the Entrepreneur

    Personal Characteristics of the Entrepreneur

    An entrepreneur is typically in control of a commercial undertaking, directing the factors of production – the human, financial and material resources that are required to exploit a business opportunity. They act as the manager and oversee the launch and growth of an enterprise. Entrepreneurship is the process by which an individual (or team) identifies a business opportunity and acquires and deploys the necessary resources required for its exploitation. The exploitation of entrepreneurial opportunities may include actions such as developing a business plan, hiring the human resources, acquiring financial and material resources, providing leadership, and being responsible for the venture’s success or failure.

    How did Michael Dell come up with the idea of a “build it yourself” computer company? How did Dave Roberts, the founder of Pop Cap Games, figure out that there is a large and growing market for “casual” electronic games?

    Researchers have identified several characteristics that tend to make some people better at recognizing opportunities than others. Before we talk about them, there is an important yet subtle difference between two key terms pertaining to this topic. We’ve already defined an opportunity as a favorable set of circumstances that create the need for a new product, service, or business. But, the term opportunity recognition refers to the process of perceiving the possibility of a profitable new business or a new product or service. That is, an opportunity cannot be pursued until it’s recognized. Now let’s look at some Personal or specific characteristics shared by those who excel at recognizing an opportunity.

    Prior Experience

    Several studies show that prior experience in an industry helps entrepreneurs recognize business opportunities. For example, evidence over time about the founders of firms appearing on the Inc. 500 list shows that well over 40 percent of those studied got the idea for their new businesses while working as employees for companies in the same industries. This finding is consistent with the findings of research studies the National Federation of Independent Businesses’ group has completed over time. There are several explanations for these findings. By working in an industry, an individual may spot a market niche that is under-served. It is also possible that while working in a particular area, an individual builds a network of social contacts in that industry that may provide insights that lead to opportunities.

    Once an entrepreneur starts a firm, new venture opportunities become apparent. This is called the corridor principle, which states that once an entrepreneur starts a firm, he or she begins a journey down a path where “corridors” leading to new venture opportunities become apparent. The insight provided by this principle is simply that once someone starts a firm and becomes immersed in an industry, it’s much easier for that person to see new opportunities in the industry than it is for someone looking in from the outside.

    Cognitive Factors

    Opportunity recognition may be an innate skill or a cognitive process. There are some who think that entrepreneurs have a “sixth sense” that allows them to see opportunities that others miss. This sixth sense is called entrepreneurial alertness, which is formally defined as the ability to notice things without engaging in the deliberate search. Most entrepreneurs see themselves in this light, believing they are more “alert” than others. Alertness is largely a learned skill, and people who have more knowledge of an area tend to be more alert to opportunities in that area than others? A computer engineer, for example, would be more alert to needs and opportunities within the computer industry than a lawyer would be.

    The research findings on entrepreneurial alertness are mixed. Some researchers conclude that alertness goes beyond noticing things and involves a more purposeful effort. For example, one scholar believes that the crucial difference between opportunity finders (i.e., Entrepreneurs) and non-finders is their relative assessments of the marketplace. In other words, entrepreneurs may be better than others at sizing up the marketplace and inferring the likely implications.

    Social Networks

    The extent and depth of an individual’s social network affects opportunity recognition. People who build a substantial network of social and professional contacts will be exposed to more opportunities and ideas than people with sparse networks. This exposure can lead to new business

    starts. Research results over time consistently suggest that somewhere between 40 percent and 50 percent of those who start businesses got their ideas through social contacts. In a related study, the differences between solo entrepreneurs (those who identified their business ideas on their own) and network entrepreneurs (those who identified their ideas through social contacts) were examined. The researchers found that network entrepreneurs identified significantly more opportunities than solo entrepreneurs but were less likely to describe themselves as being particularly alert or creative.

    An important concept that sheds light on the importance of social networks to opportunity recognition is the differential impact of strong-tie versus weak-tie relationships. Relationships with other people are called “ties.” We all have ties. Strong-tie relationships are characterized by frequent interaction and ties between coworkers, friends, and spouses. Weak-tie relationships are characterized by infrequent interaction and ties between casual acquaintances. According to research in this area, it is more likely that an entrepreneur will get a new business idea through a weak-tie than a strong-tie relationship because strong-tie relationships, which typically form between like-minded individuals, tend to reinforce insights and ideas the individuals already have. Weak-tie relationships, on the other hand, which form between casual acquaintances, are not as apt to be between like-minded individuals, so one person may say something to another that sparks a completely new idea. An example might be an electrician explaining to a restaurant owner how he solved a business problem. After hearing the solution, the restaurant owner might say, “I would never have heard that solution from someone in my company or industry. That insight is completely new to me and just might help me solve my problem.”

    Creativity

    Creativity is a phenomenon whereby something new and somehow valuable is formed. The created item may be intangible (such as an idea, a scientific theory, a musical composition, or a joke) or a physical object (such as an invention, a literary work, or a painting).

    Scholarly interest in creativity involves many definitions and concepts pertaining to a number of disciplines: engineering, psychology, cognitive science, education, philosophy (particularly philosophy of science), technology, theology, sociology, linguistics, business studies, songwriting, and economics, covering the relations between creativity and general intelligence, mental and neurological processes, personality type and creative ability, creativity and mental health; the potential for fostering creativity through education and training, especially as augmented by technology; the maximization of creativity for national economic benefit, and the application of creative resources to improve the effectiveness of teaching and learning.

    Creativity is the process of generating a novel or useful idea. Opportunity recognition may be, at least in part, a creative process. On an anecdotal basis, it is easy to see the creativity involved in forming many products, services, and businesses. Increasingly, teams of entrepreneurs working within a company are sources of creativity for their firm.

  • What is Efficacy of Activated Processes?

    What is Efficacy of Activated Processes?

    Much research has been conducted on the four major psychological processes through which self-beliefs of efficacy affect human functioning.

    Cognitive Processes

    The effects of self-efficacy beliefs on cognitive processes take a variety of forms. Much human behavior, being purposive, is regulated by forethought embodying valued goals. Personal goal setting is influenced by self-appraisal of capabilities. The stronger the perceived self-efficacy, the higher the goal challenges people set for themselves and the firmer is their commitment to them.

    Most courses of action are initially organized in thought. People’s beliefs in their efficacy shape the types of anticipatory scenarios they construct and rehearse. Those who have a high sense of efficacy, visualize success scenarios that provide positive guides and supports for performance. Those who doubt their efficacy, visualize failure scenarios and dwell on the many things that can go wrong. It is difficult to achieve much while fighting self-doubt. A major function of thought is to enable people to predict events and to develop ways to control those that affect their lives. Such skills require effective cognitive processing of information that contains many ambiguities and uncertainties. In learning predictive and regulative rules people must draw on their knowledge to construct options, to weight and integrate predictive factors, to test and revise their judgments against the immediate and distal results of their actions, and to remember which factors they had tested and how well they had worked.

    It requires a strong sense of efficacy to remain task oriented in the face of pressing situational demands, failures and setbacks that have significant repercussions. Indeed, when people are faced with the tasks of managing difficult environmental demands under taxing circumstances, those who are beset by self-doubts about their efficacy become more and more erratic in their analytic thinking, lower their aspirations and the quality of their performance deteriorates. In contrast, those who maintain a resilient sense of efficacy set themselves challenging goals and use good analytic thinking which pays off in performance accomplishments.

    Motivational Processes

    Self-beliefs of efficacy play a key role in the self-regulation of motivation. Most human motivation is cognitively generated. People motivate themselves and guide their actions anticipatorily by the exercise of forethought. They form beliefs about what they can do. They anticipate likely outcomes of prospective actions. They set goals for themselves and plan courses of action designed to realize valued futures.

    There are three different forms of cognitive motivators around which different theories have been built. They include causal attributions, outcome expectancies, and cognized goals. The corresponding theories are attribution theory, expectancy-value theory and goal theory, respectively. Self-efficacy beliefs operate in each of these types of cognitive motivation. Self-efficacy beliefs influence causal attributions. People who regard themselves as highly efficacious attribute their failures to insufficient effort, those who regard themselves as inefficacious attribute their failures to low ability. Causal attributions affect motivation, performance and affective reactions mainly through beliefs of self-efficacy.

    In expectancy-value theory, motivation is regulated by the expectation that a given course of behavior will produce certain outcomes and the value of those outcomes. But people act on their beliefs about what they can do, as well as on their beliefs about the likely outcomes of performance. The motivating influence of outcome expectancies is thus partly governed by self-beliefs of efficacy. There are countless attractive options people do not pursue because they judge they lack the capabilities for them. The predictiveness of expectancy-value theory is enhanced by including the influence of perceived self- efficacy.

    The capacity to exercise self-influence by goal challenges and evaluative reaction to one’s own attainments provides a major cognitive mechanism of motivation. A large body of evidence shows that explicit, challenging goals enhance and sustain motivation. Goals operate largely through self-influence processes rather than regulate motivation and action directly. Motivation based on goal setting involves a cognitive comparison process. By making self-satisfaction conditional on matching adopted goals, people give direction to their behavior and create incentives to persist in their efforts until they fulfill their goals. They seek self-satisfaction from fulfilling valued goals and are prompted to intensify their efforts by discontent with substandard performances.

    Motivation based on goals or personal standards is governed by three types of self-influences. They include self-satisfying and self-dissatisfying reactions to one’s performance, perceived self-efficacy for goal attainment, and readjustment of personal goals based on one’s progress. Self-efficacy beliefs contribute to motivation in several ways: They determine the goals people set for themselves; how much effort they expend; how long they persevere in the face of difficulties; and their resilience to failures. When faced with obstacles and failures people who harbor self-doubts about their capabilities slacken their efforts or give up quickly. Those who have a strong belief in their capabilities exert greater effort when they fail to master the challenge. Strong perseverance contributes to performance accomplishments.

    Affective Processes

    People’s beliefs in their coping capabilities affect how much stress and depression they experience in threatening or difficult situations, as well as their level of motivation. Perceived self-efficacy to exercise control over stressors plays a central role in anxiety arousal. People who believe they can exercise control over threats do not conjure up disturbing thought patterns. But those who believe they cannot manage threats experience high anxiety arousal. They dwell on their coping deficiencies. They view many aspects of their environment as fraught with danger. They magnify the severity of possible threats and worry about things that rarely happen. Through such inefficacious thinking they distress themselves and impair their level of functioning. Perceived coping self-efficacy regulates avoidance behavior as well as anxiety arousal. The stronger the sense of self-efficacy the bolder people are in taking on taxing and threatening activities.

    Anxiety arousal is affected not only by perceived coping efficacy but by perceived efficacy to control disturbing thoughts. The exercise of control over one’s own consciousness is summed up well in the proverb: “You cannot prevent the birds of worry and care from flying over your head. But you can stop them from building a nest in your head.” Perceived self-efficacy to control thought processes is a key factor in regulating thought produced stress and depression. It is not the sheer frequency of disturbing thoughts but the perceived inability to turn them off that is the major source of distress. Both perceived coping self-efficacy and thought control efficacy operate jointly to reduce anxiety and avoidant behavior.

    Social cognitive theory prescribes mastery experiences as the principal means of personality change. Guided mastery is a powerful vehicle for instilling a robust sense of coping efficacy in people whose functioning is seriously impaired by intense apprehension and phobic self-protective reactions. Mastery experiences are structured in ways to build coping skills and instill beliefs that one can exercise control over potential threats. Intractable phobics, of course, are not about to do what they dread. One must, therefore, create an environment so that incapacitated phobics can perform successfully despite themselves. This is achieved by enlisting a variety of performance mastery aids. Feared activities are first modeled to show people how to cope with threats and to disconfirm their worst fears. Coping tasks are broken down into subtasks of easily mastered steps. Performing feared activities together with the therapist further enables phobics to do things they would resist doing by themselves. Another way of overcoming resistance is to use graduated time. Phobics will refuse threatening tasks if they will have to endure stress for a long time. But they will risk them for a short period. As their coping efficacy increases the time they perform the activity is extended. Protective aids and dosing the severity of threats also help to restore and develop a sense of coping efficacy.

    After functioning is fully restored, the mastery aids are withdrawn to verify that coping successes stem from personal efficacy rather than from mastery aids. Self-directed mastery experiences, designed to provide varied confirmatory tests of coping capabilities, are then arranged to strengthen and generalize the sense of coping efficacy. Once people develop a resilient sense of efficacy they can withstand difficulties and adversities without adverse effects.

    Guided mastery treatment achieves widespread psychological changes in a relatively short time. It eliminates phobic behavior and anxiety and biological stress reactions, creates positive attitudes and eradicates phobic ruminations and nightmares. Evidence that achievement of coping efficacy profoundly affects dream activity is a particularly striking generalized impact.

    A low sense of efficacy to exercise control produces depression as well as anxiety. It does so in several different ways. One route to depression is through unfulfilled aspiration. People who impose on themselves standards of self-worth they judge they cannot attain drive themselves to bouts of depression. A second efficacy route to depression is through a low sense of social efficacy. People who judge themselves to be socially efficacious seek out and cultivate social relationships that provide models on how to manage difficult situations, cushion the adverse effects of chronic stressors and bring satisfaction to people’s lives. Perceived social inefficacy to develop satisfying and supportive relationships increases vulnerability to depression through social isolation. Much human depression is cognitively generated by dejecting ruminative thought. A low sense of efficacy to exercise control over ruminative thought also contributes to the occurrence, duration and recurrence of depressive episodes.

    Other efficacy-activated processes in the affective domain concern the impact of perceived coping self-efficacy on biological systems that affect health functioning. Stress has been implicated as an important contributing factor to many physical dysfunctions. Controllability appears to be a key organizing principle regarding the nature of these stress effects. It is not stressful life conditions per se, but the perceived inability to manage them that is debilitating. Thus, exposure to stressors with ability to control them has no adverse biological effects. But exposure to the same stressors without the ability to control them impairs the immune system. The impairment of immune function increases susceptibility to infection, contributes to the development of physical disorders and accelerates the progression of disease.

    Biological systems are highly interdependent. A weak sense of efficacy to exercise control over stressors activates autonomic reactions, catecholamine secretion and release of endogenous opioids. These biological systems are involved in the regulation of the immune system. Stress activated in the process of acquiring coping capabilities may have different effects than stress experienced in aversive situations with no prospect in sight of ever gaining any self-protective efficacy. There are substantial evolutionary benefits to experiencing enhanced immune function during development of coping capabilities vital for effective adaptation. It would not be evolutionarily advantageous if acute stressors invariably impaired immune function, because of their prevalence in everyday life. If this were the case, people would experience high vulnerability to infective agents that would quickly do them in. There is some evidence that providing people with effective means for managing stressors may have a positive effect on immune function. Moreover, stress aroused while gaining coping mastery over stressors can enhance different components of the immune system.

    There are other ways in which perceived self-efficacy serves to promote health. Lifestyle habits can enhance or impair health. This enables people to exert behavioral influence over their vitality and quality of health. Perceived self-efficacy affects every phase of personal change–whether people even consider changing their health habits; whether they enlist the motivation and perseverance needed to succeed should they choose to do so; and how well they maintain the habit changes they have achieved. The stronger the perceived self-regulatory efficacy the more successful people are in reducing health-impairing habits and adopting and integrating health-promoting habits into their regular lifestyle. Comprehensive community programs designed to prevent cardiovascular disease by altering risk-related habits reduce the rate of morbidity and mortality.

    Selection Processes

    The discussion so far has centered on efficacy-activated processes that enable people to create beneficial environments and to exercise some control over those they encounter day in and day out. People are partly the product of their environment. Therefore, beliefs of personal efficacy can shape the course lives take by influencing they types of activities and environments people choose. People avoid activities and situations they believe exceed their coping capabilities. But they readily undertake challenging activities and select situations they judge themselves capable of handling. By the choices they make, people cultivate different competencies, interests and social networks that determine life courses. Any factor that influences choice behavior can profoundly affect the direction of personal development. This is because the social influences operating in selected environments continue to promote certain competencies, values, and interests long after the efficacy decisional determinant has rendered its inaugurating effect.

    Career choice and development is but one example of the power of self-efficacy beliefs to affect the course of life paths through choice-related processes. The higher the level of people’s perceived self-efficacy the wider the range of career options they seriously consider, the greater their interest in them, and the better they prepare themselves educationally for the occupational pursuits they choose and the greater is their success. Occupations structure a good part of people’s lives and provide them with a major source of personal growth.