PETER DRUCKERS VIEW ON ENTREPRENEURSHIP

Peter Drucker has aptly observed that, “Innovation is the specific tool of entrepreneur’s, the means by which they exploit changes as an opportunity for a different business or a different service. It is capable of being presented as a discipline, capable of being learned and practiced. Entrepreneurs need to search purposefully for the sources of innovation, the changes and their symptoms that indicate opportunities for successful innovation. And they need to know and apply the principles of successful innovation.”

Systematic innovation, according to him, consists in the purposeful and organized search for changes and in the systematic analysis of the opportunities such changes might offer scope for economic and social innovation.

According to Drucker, three conditions have to be fulfilled.

1. Innovation at work. It requires knowledge and ingenuity. It makes great demands on diligence, persistence and commitment.
2. To succeed, innovation must build on their strengths
3. Innovation always has to be closed to the market focused on the market, indeed market- driven. Specially, systematic innovation means monitoring sources for innovative opportunity.

The first three sources lie within the enterprise, whether it be a business or a public service institution or within an industry or service sector. They are therefore, visible primarily to people within that industry or service sector. They are basically symptoms. But they are highly reliable indicators of changes that have already occurred or can be made to occur with little effort.

These four source areas are:

1. The unexpected success, the unexpected failure, the unexpected outside event.
2. The incongruity between reality as it actually is and reality as it is assumed to be or as it “ought to be”.
3. Innovation in industry structure or market structure that catches everyone unawares.
4. The second set of sources for innovative opportunity, a set of three, involves changes outside the enterprise or industry:

• Demographics (population changes).
• Changes in perception, mood and meaning.
• New knowledge, scientific and non- scientific.