Home Entrepreneurship Role and Importance of Business Entrepreneurship in Society

Role and Importance of Business Entrepreneurship in Society

by Olufisayo
Role and Importance of Business

Economists and businessmen have no doubts that the private sector is in a lot of ways much more efficient and effective than the public one, but few common people share this opinion.

They generally believe that their greedy neighbours embark on business enterprises driven mostly by an insatiable passion for money and other selfish aspirations and they refuse to see the role business plays in modern society, the importance of entrepreneurship to individuals, the importance of entrepreneurship in economic development and importance of entrepreneurship in developing countries – the role that makes business not selfish at all.

First and foremost, the business produces and distributes goods and services to satisfy certain public needs. To fulfil this task, the business has to be very flexible and constantly research consumer demands: what’s the point of producing something that nobody wants to buy?

Second, the business creates job opportunities. More than that, most jobs business helps create are productive jobs, i.e.., people employed by business ventures produce “real” goods and services.

Third, the business provides income – here we come at last to the money matter 🙂 But don’t forget: income that a business provides is by no means restricted to the profit its owners get.

It pays salaries and wages to its employees, and this way, makes the whole business world go round: they spend the money they earn buying all kinds of goods and favour further development of business ventures.

Forth, the business contributes to national well-being. It does it in several ways: by means of taxes it pays which make it possible for the government to maintain all kinds of public and social institutions and services; by investing money in developing science and technology and constructing new enterprises; by full use of local resources, including those located in remote rural areas, and in a number of other ways.

Fifth, the business helps enlighten and educate people and encourages their further personal growth. High level of competition makes it vital for both businessmen and their employees to be involved in the constant process of learning and developing their personal qualities such as creativity, determination, communication skills and vision for new business opportunities.

So you see, that despite public opinion on this matter, business is not all that selfish. In fact, it is much more unselfish than a lot of public institutions 🙂 It does not exist to satisfy its own needs – that is a way to business failure.

On the contrary, its function is to satisfy in the long run the consumer demands – our demands and to make our life comfortable. So, when you make this crucial decision to embark on a business enterprise, bear in mind that it is a way to serve society 🙂

Goals of Individuals and Society

Setting goals, and then working to achieve them, is a sign of maturity and responsibility in a society, just as it is a sign of maturity in an individual. What goals have people set for themselves in their economic life? And how well are these goals being achieved? These are the questions discussed in this handout.

One important goal that the people have set for their economy is Full Production in order to achieve full employment. We want to make full use of the productive resources that are available -labour, capital and natural resources -and use these resources efficiently.

How well are we achieving the goal of full employment and full production? The nation can’t realistically expect to provide jobs continuously for 100% of the men and women who are able and willing to work. There will always be some unemployment – roughly 2 to 5% of the labour force.

But when millions of people are unnecessarily unemployed, it means they are not making a productive contribution to the country and they are not earning an income. For this reason, the goal of full production -which requires both full employment and efficiency – is one of the most important in our economy.

A second major goal is a Stable Growth. We want the economy to become bigger and better over the years. We measure the amount of our national output of goods and services by looking at statistics of Gross National Product.

Economic growth is a steady increase in GNP per person (total GNP divided by the nation’s population). We want GNP to increase more or less at a steady rate – about 4 or 5% each year (informal sector estimate) – without having business recessions or rapidly rising prices (inflation), or increases in unemployment.

Production, employment and growth of GNP are all pretty easy to measure. When we come to certain other economic goals, however, we have to talk about them in more general terms.

Freedom of Choice is a goal that practically everyone would include high on the list. But what does it mean in concrete terms? Economists have pointed out that freedom of choice is important for consumers, for workers, and for businesses.

Freedom of consumer choice means that consumers will be able to select the goods they want to buy from a fairly wide range of alternatives, according to individual needs and preferences. We are not satisfied with a system where the consumer is told: “You can have any size and colour that you want – as long as it’s medium and black!”

Freedom of occupational choice is an important area of economic freedom. Men and women want to be able to choose the kind of work they will enjoy doing and that will provide adequate wages and personal satisfaction.

Finally, there is much talk about the importance of “free enterprise”. This is an important aspect of freedom of choice. It gives people the freedom to start their business and use the factors of production in such a way as to make a profit. Much of the current economic system is built on the foundation of this particular freedom.

Equality of Opportunity for men and women in society is another goal. It is closely related to freedom of choice because it says that all people should approximately the same degree of freedom – to exercise their rights as consul workers and enterprises.

The goal of Economic Security means that we want the members of economic society to have enough money to be able to buy adequate food, clothing, shelter and other necessities.

Widespread poverty not only means failure to achieve the goal of economic security for these people, but it also raises serious questions about whether we are achieving the goal of Economic Justice in society.

Not everyone agrees on the meaning of fairness and justice in economic life, but its goal that nearly everyone feels is important to define and work toward.

Finally, there is one economic goal that is not limited to the boundaries of the country but spreads overseas to other countries. This is the goal of International Balance. We want to maintain a strong and balanced relationship in foreign trade and international payments.

Failure to achieve this goal not only causes serious economic problems at home and abroad but also increases international tensions threaten world peace.

Photo by Tiger Lily from Pexels

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Ochieng O Joseph May 31, 2011 - 5:38 PM

All the answers are parfect

famousliser June 28, 2011 - 12:48 AM

i luv dis post bcouse is improve my knowledge.

James O September 12, 2011 - 9:46 AM

Wonderful post, but there is need to post also the role of a society to business, since the two co-exist

Atieno F.Mhonie November 9, 2011 - 9:51 PM

Am a student and the website has really assisted me complete my assignment. It is well written in good and easy to understand English. The use of the term ‘business’ insted of ‘entrepreneurship’ has been of great help to me. I now know the two terms basically refer to the same concept.

09 Nov 2011

Explaining Entrepreneurship Concepts January 8, 2012 - 4:46 PM

[…] Entrepreneurship is a concept that is so protean in nature that it is virtually difficult to categorize it in a single acceptable definition. So much so that a well respected economist, Mark Casson once affirm that “entrepreneurship means different things to different people”. […]

Jomie M February 2, 2012 - 3:13 AM

nice article! may I know who’s the author of this? Thanks!

disha agrawal December 26, 2012 - 10:32 AM

this is a very nice article it helped me a lot for completing my assignment successfully

disha agrawal December 26, 2012 - 10:34 AM

I am a student of enterpreneurship I liked this article.

Michael clement Mhando March 1, 2013 - 6:21 PM

Ilike people who are entrepreneur

Francisca C. April 2, 2013 - 2:48 PM

This article is very good article and it has really helped me to complete my assignment. May i know the Author of this. Thank you…

Justin Martin July 7, 2013 - 4:54 AM

There is a worldwide trend, a new and broader interpretation and acceptance of the role of the entrepreneur in society. The business, financial and investment agencies have come to recognize the significant contribution of people who want to go out and start new enterprises, add wealth and market value with their own endeavours. These include those intrepid individuals who buy unprofitable organisations and, leveraging resources and skills, to stage a turn around.

nicodemus mochama February 6, 2015 - 1:00 PM

the answers were useful for they made me finish my assignment succesfully

Olufisayo February 6, 2015 - 3:35 PM

Glad we could help. Regards

sohail August 26, 2015 - 11:17 PM

Yes, it helped me a lot in making the opinion about the role of business in the society, but the socio-economic fabric of the society and its linkage with the business should have been discussed in detail.The Business not only changed the financial stream in the society, but it also has contributed towards changing social trends, demographics, societal norms and structural-functional approach of society in a great way.The opening of fast food outlet in any classical city not only changes the financial and food trends but also contributes towards social trends in society by providing with the people food at takeaway points.I’m chief editor at freelancewritingexpert. com and I want to contribute towards your website

What Is the Role of Business in Society? November 26, 2020 - 3:11 AM

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