SUSTAINABLE BUSINESS IN THE CONTEMPORARY

ENVIRONMENT:
MAKING SENSE OF BUSINESS AND ITS CONTEXTS

WEEK 1 SESSION 2
BUSINESS IN CONTEXT AND
ENTREPRENEURSHIP
(Needle and Burns, 2019) Chapters 1, 10
To access, click here
This session looks at the activities context of the
contemporary environment, which covers business functions
such as marketing and innovation. The latter is associated
with entrepreneurship, which is the process of developing
new products and services. Entrepreneurship is often linked
to personal resilience – an important employability skill that
you will develop today. To conclude, we’ll question the
BUSINESS IN CONTEXT
ENTREPRENEURSHIP
EMPLOYABILITY
OBJECTIVE
LEARNING OUTCOMES  Today you will develop your
 Identify business functions personal resilience – a key
and entrepreneurship skill for entrepreneurs
 Gain an overview of the  It refers to the ability to
activities level and the wider bounce back from adversity
contexts  This is a key developmental
 Evaluate the activities level skill to understand how you
can manage a changing world
more effectively
RECAP OF PREVIOUS SESSION

• In the last session, we established that business can be

best viewed and analysed as a series of related activities
in different contexts.
• We covered two:
• The environmental context
• The organisational and strategic context
THE BUSINESS IN
CONTEXT MODEL
ENVIRONMENTAL CONTEXT
•Political, economic, socio-cultural,
technological, ethical and legal
factors impact the organisation

ORGANISATIONAL AND
STRATEGIC CONTEXT
•Decisions need to be made to
determine the direction of the
organisation

ACTIVITIES CONTEXT
•Business functions within the
organization interact with the
different contexts
ACTIVITIES CONTEXT:
BUSINESS FUNCTIONS
• This module focuses on
four key business
functions
• Different business
Finance Innovation functions interact with
and
Accounting
one another
• For example, business
expansion in another
geographic area will
Marketing
Human Resources impact on staffing levels
Management
and therefore Human
resources management
BUSINESS FUNCTIONS: EXAMPLE
INTERACTIONS
A strategic decision is made to expand into a new market, e.g. a café
chain moves to Australia…
• Now the marketing department needs to target new consumers
• The HR department may seek to hire new expertise, who understand
local laws, regulations, consumer preferences
• Market research may determine that Australian consumers require
tailored coffee products, i.e. the flat white
• Innovation / R & D likely need to develop amended product offering(s)
• All of the above are contingent upon the finance department’s budget
allocations
ACTIVITIES
CONTEXT:
• Traditional concerned with
HRM recruitment, selection,
training, pay, welfare and
industrial relations

• HRM integrates them with the

overall strategy of the
enterprise and sees business
values as an overriding
consideration
This Photo by Unknown Author is licensed under CC BY-SA

• An important element of HRM

is the development of a
corporate culture
ACTIVITIES CONTEXT:
FINANCE AND ACCOUNTING
ACTIVITIES CONTEXT:
FINANCE AND ACCOUNTING IN PRACTICE

Again, suppose a firm makes a strategic decision to invest in new

process technology…
1. In making the decision, company leadership will rely upon internal
forecasts and investment calculations: management accounting
2. Once the decision has been made, management will need to raise
funding – accounting information must be presented externally, to a
bank or potential investor, to demonstrate viability: financial
reporting
3. Once funding is secured it must be allocated/managed on an ongoing
basis: financial management
ACTIVITIES CONTEXT

‘Marketing is the
management process
responsible for identifying,
anticipating and satisfying
customer requirements
profitably’
(The Chartered Institute of Marketing)

This Photo by Unknown Author is licensed under CC BY-SA

ACTIVITIES CONTEXT
• Linked to the survival and growth
of individual companies

• Innovation is linked to higher and

sustainable profit through
increased sales or improved cost
reduction - key ingredient for
survival in a competitive market

• Innovation is associated with

Entrepreneurship, the process of
creating new products and
services, new processes, new
This Photo by Unknown Author is licensed under CC BY-NC methods of management and
new markets
KEY CONCEPT 10.5 ‘…the activity of entrepreneurs,
ENTREPRENEURSHIP who are responsible for the
creation of new products,
processes, services and
market…
They develop new ways of doing
business, create new
organization forms and new
ways of managing people…
Entrepreneurs are usually
willing to lead and to take
responsibility for their actions.’
This Photo by Unknown Author is licensed under CC BY

(Needle and Burns, 2019:369)

WHAT IS ENTREPRENEURSHIP?
INNOVATION
AND
ENTREPRENEUR
SHIP
‘Innovation is the specific tool
of entrepreneurs, the means
by which they exploit change
as an opportunity for a
different business or service. It
is capable of being presented
as a discipline, capable of
being learned, capable of being
practised’

(Peter Drucker)
 INNOVATION AND
ENTREPRENEURSHIP
Stage in Start-up Growth Sustain/scale Renew
life
cycle
Entrepreneurs Adding new Building a portfolio Returning to the
Creatin exploiting new products/services of incremental and radical frame-
g technology or or moving into new radical innovation breaking kind of
wealth market opportunity markets to sustain the innovation which
business began the business

Creatin Social Developing the Spreading the idea Changing the

g social entrepreneurs ideas and widely, diffusing it system - and then
value engaging others in to other acting as agent for
a network for communities of next wave of
social change social change
entrepreneurs
 MODEL FOR
ENTREPRENEURSHIP
Three types of Entrepreneur:
• Lifestyle entrepreneurs: seek independence through self
employment. Very few of these will be innovative
• Growth entrepreneurs: seek wealth, influence and
reputation and many have created large, aggressive
organisations as in the case of Jeff Bezos and Amazon
• Innovative entrepreneurs: their main interest is creating
something new. Growth is a by-product

(Tidd and Bessant, 2020)

FACT-FIND: ARU DIGITAL LIBRARY
DEFINING ENTREPRENEURIAL RESILIENCE
• Log on to the ARUL Digital Library
• Use the ‘Library Search’ function to find the following source:
• Ayala, J-C. & Manzano, G., 2014. ‘The resilience of the entrepreneur. Influence
on the success of the business. A longitudinal analysis.’ Journal of Economic
Psychology. 42: p126-135.
• Open the academic article and identify the following section on p127:
• “2. Resilience of the entrepreneur and business success”
• The authors’ favoured definition of resilience incorporates three
elements: (1) resourcefulness, (2) hardiness and (3) optimism.
• TASK: extract technical definitions for each of the these three from
the article.
IT’S ALL ABOUT RESILIENCE
VIDEO TO HELP YOUR UNDERSTANDING
•The ability to bounce back from low-
points is a critical skill for every
entrepreneur
•But how do you develop resilience?
Ravi Belani shares three ways aspiring
entrepreneurs can begin to build a
toolkit for resilience. Drawing on
research studies from Duke and
Stanford, Belani recommends
practicing these habits to prepare
students to navigate hurdles and jump
at opportunities
•To watch this introductory video, click
here
BREAK
 GETTING YOU READY FOR A
CHANGING WORLD
EMPLOYABILI
TY SKILLS

SELF-
RESILIENCE IS THE ABILITY TO AWARENESS
BOUNCE BACK FROM
PERSONAL
DIFFICULTIES RESILIENCE
Understand more about your own MOTIVATION
DEVELOP YOUR
resilience. AT WORK
PERSONAL
Gain awareness of how well you CUSTOMER
RESILIENCE FOCUS
deal with challenging situations.
Develop your WORKPLACE
Understand how to make yourself CULTURE
capabilities and
stronger and more resilient and
attributes to succeed DECISION-
learn how you can manage a MAKING
in a changing world.
changing world more effectively. MANAGEME
NT SKILLS
 DEVELOP YOUR PERSONAL
RESILIENCE

Assessment Learning Analysis Practice Applicati

Go to Career Resilience refers Look at your overall Identify on
Zone/Step 1 ‘to a dynamic resilience score and ways in Decide on
Explore & process follow the advice which you an
Decide/Caree encompassing provided in your may be able opportunity
r positive individual report in to improve to practise
Assessments adaptation within relation to work. This will the this skill in
take the the context of include some straight- elements of real-life
Personal significant forward skills and resilience
Resilience adversity’ (Luthar, techniques you can use that require
assessment Cicchetti & Becker, to help you maintain and specific
2000: 543) – key develop your levels of attention
personality trait resilience, especially as
CLOSING CASE: ENTREPRENEURSHIP
AS A ‘TEAM GAME’
• Independence,
creativity and
resilience are surely all
essential characteristics
for a successful
entrepreneur
• Apple would never have
become the most powerful
brand in the world without the
vision of Steve Jobs and the
design prowess of Jony Ive
 But is entrepreneurship really
just about individual brilliance?
 What else goes into a successful
product?

Source: Mazzacato (2013, p. 109)

SYSTEMS OF INNOVATION:
‘NARROW’ VS. ‘BROAD’
PERSPECTIVES
• Mazzucato (2017, p16) distinguishes between the:
1. Narrow conception of innovation systems, which focuses on only
the relationship between:
a) Science and technology subsystem: “capacity-building, training and
formal education, plus science- and technology-related services”
b) Production and innovation subsystem, i.e. the commercial sector
where entrepreneurs operate
2. Broad conception of innovation systems, which incorporates a
range of other contributory subsystems:
i. Policy
ii. Promotion
iii. Representation & Financing
iv. Demand (i.e. market segments)
v. Geo-political context
vi. Socio-economic context
GENERIC NATIONAL INNOVATION
SYSTEM (MAZZUCATO, 2017,
p17)
CLOSING CASE: HYUNDAI
Read this short
excerpt from
Ha-Joon
Chang’s (2022)
recent book,
then answer
the questions
on the next
slide…
QUESTIONS
1. Who was the lead designer of 4. In what ways has the
the first locally-mass-produced United States
South Korean automobile?
government sought to
2. From the launch of its first sole enable its entrepreneurs?
venture car in 1976, how long
did it take for Hyundai to 5. Do you think
overtake Ford in annual governments should
production volume? support their domestic
3. Aside from Chung Ju-yung and industries in the ways
Chung Se-yung, which other described? Are there any
South Koreans were integral to
the commercial success of downsides to such
Hyundai? support?
SUMMARY
 Business activities includes innovation and entrepreneurship,
marketing, human resources management, finance and accounting,
take place in a set of contexts
 These contexts are environmental, strategic and organizational
 Entrepreneurship plays a key role in innovation
 We have identified different types of entrepreneur and factors that
contribute to the development of entrepreneurs
 Resilience is the ability to stay the course when times are tough and
to take setbacks in stride - the quality of resilience is an essential
character trait for entrepreneurs
 There are both narrow and broad perspectives on systems of
innovation and therefore the degree to which individual
entrepreneurship is decisive
TO BE CONTINUED…

 We have now covered the three

contexts in which businesses
operate: environmental,
organizational and strategic, and
activities context
 The next session will look at how
businesses stay competitive.
Above all, they need to respond to
changes in the business
environment
 We will focus on the different
aspects of the business
environment and models used to
SUSTAINABLE BUSINESS IN THE
CONTEMPORARY ENVIRONMENT:
MAKING SENSE OF BUSINESS AND
ITS CONTEXTS

STUDENT SUPPORT
 Answering your questions
to help you succeed
GO THE EXTRA MILE:
SELF-STUDY TO ENHANCE YOUR
UNDERSTANDING
• Take the online quiz
• Watch this video which does away with the ten myths of
entrepreneurship and shows how one can create a successful
start-up business without money, business plan or even an idea
 GO THE EXTRA MILE:
DEVELOP YOUR PERSONAL
RESILIENCE
HOW TO BECOME A RESILIENT ENTREPRENEUR
Every entrepreneur needs to focus on developing less
tangible, but vital skills such as resilience.

In fact, one recent article in Forbes magazine placed the quality of

resiliency at the top of its list of essential character traits
for entrepreneurs.

Click here to read the article and answer the following questions:

1. Why should you blend confidence with humility?

2. Name two companies that have lost the edge.
3. How should we deal with mistakes?
 REFERENCES
• Ayala, J-C. & Manzano, G., 2014. ‘The resilience of the entrepreneur. Influence on the success of the business. A longitudinal
analysis.’ Journal of Economic Psychology. 42: p126-135.
• Beer, M., Spector, B., Lawrence, P., Quinn Mills, D. and Walton, R.E., 1984. Managing Human Assets, Free Press: New York.
• Bessant, J.R. and Tidd, J. 2015, Innovation and entrepreneurship, 3rd edn, Wiley, Chichester.
• Chang, H.-J., 2022. ‘From carbs to cars: how South Korea’s success shows entrepreneurship is a team game’. The Observer.
[online] Available at:
https://www.theguardian.com/books/2022/oct/30/from-carbs-to-cars-how-south-koreas-success-shows-entrepreneurship-is-a-t
eam-game-ha-joon-chang-edible-economics

• Hashemi, S,, 2014. What makes an entrepreneur? [Online Video]. 12 November 2014. Available from TEDxYouth Bath:
https://www.youtube.com/watch?v=r8nHptyS234 . [Accessed: 8 September 2021].
• Luthar, S. S., Cicchetti, D., & Becker, B. 2000. The construct of resilience: A critical evaluation and guidelines for future work.
Child Development, 71(3), 543–562. https://doi.org/10.1111/1467-8624.00164
• Mazzucato, M., 2013. The Entrepreneurial State: Debunking Public vs. Private Sector Myths. London: Anthem Press.
• Mazzucato, M., 2017. ‘Mission-Oriented Innovation Policy: Challenges and opportunities’. The RSA in partnership with UCL.
[pdf] Available at: https://www.thersa.org/globalassets/pdfs/reports/mission-oriented-policy-innovation-report.pdf [Accessed:
6 September 2023]
• Morrison, J., 2020. The Global Business Environment: Towards Sustainability? 5th Edition, London: Macmillan Education UK.
• Needle, D. and Burns, J., 2019. Business in Context: An Introduction to Business and its Environment, 7th Edition. Cengage
Learning.
• Leruste, M., 2017. What they don’t tell you about Entrepreneurship. [Online Video]. Available from TEDxCardiff:
https://www.youtube.com/watch?v=f6nxcfbDfZo. [Accessed: 8 September 2021].
• Schumpeter, J.A., 1961. The Theory of Economic Development. 3rd Edition, Oxford University Press, New York.