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Entrepreneurship, Innovation and

Leadership

Assessment 3 Article: Entrepreneurship

Presented in London Metropolitan University

by Rubab Javaid.

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Contents

Page

Introduction…………………………………………………………………3

Diffusion of Innovations (Dol) Theory …………………………………..4-5

McClelland’s theory of Needs / Achievement Motivation Theory………5-6

Analytical conclusion………………………………………………………6-8

Critical Analysis…………………………………………………………….8

References……………………………………………………………………..9

Appendix ( Interview Text) ………………………………………………10-15

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Introduction

An entrepreneur is a person who attempts to profit by risk and initiative. According

to the French economist, Jean-Baptist Say 1800, entrepreneurs shift economic

resources from an area of lower productivity into an area of higher productivity and

greater yield. In other words entrepreneurs create value by exploiting some form of

change, for example in technology, materials, prices or demographics. We call this

process innovation and this is an essential tool for entrepreneurs. The entrepreneur

or business owner, looked at in this report is a Pakistani entrepreneur, Adnan

Bashir Khan from Peshawar, Pakistan. Mr. Khan runs a printing company known

as Roshnai Printers which he started in 2011, amongst other businesses he

previously developed. Roshnai Printers print books, magazines, cards and any sort

of material needed to be printed for schools, the government, or the local magazine

companies. This is a small sole trader business, with around 54 workers, 3 of

which are appointed managers, the rest of which are employees working under

these managers. It consists of around 8 to 9 forms of capital in machinery. Mr.

Khan financed for the start up of this business from his own money, without taking

any loans or overdrafts from the bank. He did so through self funding, by the funds

generated from his other 2 businesses, as well as by selling some of his assets, such

as his car. When asked, what motivated him to become a business owner rather

than work under someone else in a company he responded. “Well as in my own

personality was that I cannot work for other people, I have to come up with my

own ideas and have to focus on things I think over, and it made me do things that

were kind of incredible. I started off with many new ideas and thoughts, and they

came up in the market, and people started like them. I felt I could be a very good

business man rather than a 9 to 5 job person.”

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Mr. Khan & the Diffusion Of Innovations (Dol) Theory

The Dol theory, purports to describe the patterns of adoption, explain the

mechanism, and concerns the manner in which a new technological idea, artifact or

technique, or a new use of an old one, migrates from creation to use. According to

DoI theory, technological innovation is communicated through particular channels,

over time, among the members of a social system. I think this theory best relates to

Mr.Khan’s business as it is also a technological innovation, of an old service but

with a new and more efficient use. The Dol theory suggests, there are 5 stages

through which a technological innovation passes. One of which is knowledge, of

exposure to its existence and understanding of its functions. Mr. Khan had a very

well thought out knowledge of this business, as before starting his own business,

he used to work as a middle man and dealt with contracts concerning clients and

manufacturers, handling their printing jobs. This gave him exposure to the industry

as well as gave him a deep understanding of the running of the business and its

functions and how it operates. Although mass media channels of communication

are relatively important in this stage, but as Mr.Khan mentioned in his interview,

he didn’t depend on mass media channels as he runs his business in a developing

country where there isn’t much exposure through the mass media channels,

although he did make a lot of use of interpersonal channels of communication of

making contacts with change agents through his work as a contractor which is

relatively important in the next stage of persuasion. He achieved this stage of

persuasion by persuading the clients and the manufacturers to agreeing on a low

price of cost between the two, which would help him gain the maximum revenue

for himself, not only that but through his quality and timely delivery, he persuaded

his clients to see him with a positive and trusted image, which he knew would

come in handy, later when he started his own business.

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The third stage is making a decision of rejecting or accepting the idea, of the

business. Mr. Khan took a risk by accepting to start such a business which wasn’t

very innovative it already existed in the market, but by doing it in a new way. By

the use of the best quality of machinery as well as labor, he analyzed his

competitors’ weaknesses and made them into his strengths. Although he was

discouraged by many of his competitors, not to enter this industry as he won’t

stand a chance due to the competition, he still took a risk and made a decision to go

about it.

The fourth stage is implementation, he implemented everything he had learned

whilst a contractor, as well as he learned all the do’s and don’ts of the business by

keeping a close interaction with all of his competitors in the industry, on a friendly

level, and learning from their weaknesses and mistakes. When asked about this he

responded, “I know it was not ethical, but I had to do this in order to survive in this

business.”

The last stage of this theory is confirmation, which is reinforced based on positive

outcomes. Mr. Khan received a number of positive outcomes, which gave him the

confirmation of his risk paying off. One of which is, that Roshnai Printers are

today known as one of the best printers in this industry in that district, most

importantly for their best quality and efficiency. Also in 2011 when the business

had started it was categorized as a “D” grade business by the market, and today it

is categorized as a “B” grade business, Roshnai Printers made its way up 3 levels

within a short period of just 2 years.

Mr.Khan & McClelland’s theory of Needs / Achievement

Motivation Theory

David McClelland’s theory of Needs / Achievement Motivation states that human

behaviour is affected by three needs Need for Power, Achievement and Affiliation.

Need for achievement is the urge to excel, to accomplish in relation to a set of

standards, to struggle to achieve success. Need for power is the desire to influence

other individual’s behaviour as per your wish. In other words, it is the desire to

have control over others and to be influential. Need for affiliation is a need for

open and sociable interpersonal relationships. In other words, it is a desire for

relationship based on co-operation and mutual understanding.

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Mr.Khan’s business plans is based on each one of these needs. As for Mr. Khan’s

need for achievement, it was solely based on McClelland’s theory in which he

suggested it is to get success with one’s own efforts and is not influenced by

money , and views profit as measure of success. This is based upon Mr.Khan

because he mentioned he came from a business running family, his father also ran

a business, but he wanted to create his own business with his own efforts, which

motivated him to start from scratch on his own. He also sees profit as a form a

success and is not influenced by money because he already has two running

businesses, he started Roshnai Printers as a form of further success and

achievement.

As for Mr.Khan’s need for power to dominate and influence others, he also shows

that when he tells us, that before starting his business, he called over all of his

competitors over for a dinner party, and got to know all of them, coming on good

terms with them. He also came closer to them through his previous job as a

contractor when dealing with them as manufacturers for his clients. He befriended

many of them, and due to such friendly terms, he now has a sort of domination

over them where he can get them to agree to lower their printing charges when

trying to chase away new competitors in the market. This gives Mr. Khan a form of

power to influence and dominate others, through well known politics which run in

the business industry, better referred to as “I scratch your back, you scratch mine.”

As for the last aspect of this theory, which is an affiliation of basically maintaining

friendly relations with others, like mentioned above he has done that with his

competitors, but also through his other businesses with clients such as the United

Nations, and many other businesses with which he interacted before through his

other businesses, which now come to him for the use of printing, due to his

previous dealings with them.

Analytical conclusion

In my opinion Mr. Adnan Khan is a true entrepreneur. This is because of his views

of growing a business within the same sort of industry on a different level, which

gives it a smaller risk of failing. Also due to the amount of calculated risks he

takes. He tends to do lots of research before making a decision. With Roshnai

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Printers he worked as a middle man before starting the business, he then got to

know his competitors and their weaknesses and overcame those. He also works as

a democratic leader within his organizational structure, by having his managers on

board when making a decision and taking feedback from his workers and managers

and interacting with them on a daily basis. He has a strong vision which he works

on with strategic techniques, and is already planning of growing this business

further into the food industry in a few years time. The model below best describes

how Mr. Khan went about his business plan which shows he is a true entrepreneur.

He also proves himself as a true entrepreneur through his close communication

skills with all of his competitors, previous business dealings, and with his close

relative and friends through which he advertises his business, by having them

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represent a sticker of his company on their cars or simply having them pass on his

company’s information to potential clients they may know. He planned out this

business by getting to know its target audience, which were the clients whose

contracts he dealt with, his competitors through which he fulfilled the contracts, by

creating a positive image of himself before hand with the clients and

manufacturers, and by identifying his competitors’ weaknesses and making them

his business’s strong aspects.

Critical Analysis:

Although Mr. Khan has flourishing business now, his idea was not an innovative

one, his techniques on production and grabbing the market was innovative, but the

main business idea of printing was not innovative, as it had already existed in the

market. Another factor, to look at would be that although Mr. Khan made his way

up to a successful business, he did use some unethical practices, such as when

getting to know his competitors and beating them at their own game, by

befriending them first, and then visiting their industries, and studying their

weaknesses and strengths and making them his strong aspects, thus getting all of

their clients.

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References

Burns, P., 2001. Entrepreneurship and Small Business. 1st ed. New

York, N.Y: Palgrave.

Huang, Kevin Shihping, and Yu-Lin Wang. "Entrepreneurship and

Innovation: A Review of the Theory and Literatures."

McClelland, D.C, 1998. Human Motivation . 1st ed. New York, N.Y:

Press Syndicate .

Rogers, E.M, 2003. Diffusion of Innovations. 5th ed. New York: Free

Press.

Shane, S., 2003. The General Theory of Entrepreneurship. 1st ed.

Cheltenham : Edward Elgar Publishing Ltd.

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Appendix

Q: Hi, I’m here with Adnan B. Khan, and he’s a former friend of mine, he runs a number of

different businesses, so I decided to interview him, and one of the specific ones that we will be

concentrating on is Roshnai Printers, so Adnan tell me about yourself?

Mr.Khan: I have done Bachelors in telecom engineering, and then masters in business

administration. I was always persuaded to do some kind of a business, I never knew what kind of

a business I’d be doing, I belong to a business family as in I grew up related to many businesses,

and well I started my first business as I dealt with cars, as I built them and then sold them. Then

in 2009 I started an organization for youth and development, we were basically social workers,

we started it from a small place, with 3 or 4 people, gradually, it went to 9 to 10 thousand

members around Pakistan, and around 1500 to 2000 international members. We worked with

different UN agencies, Unites nations, United Nations for high commisons, and UN consulate

and some other big donors. This organization gave me an idea, that why shouldn’t I promote

entrepreneurship business, as my country is facing loads of problems and issues, people don’t

have jobs people are facing loads of issues and everybody is getting frustrated, this was the point

that made us realize that we should get into businesses, as give many people opportunities, as

one business links to another, another links to another and so on as it is a chain, One business can

get hundreds of people on job, so this was the basic idea where we started. My first business was

Prolog, which is a logistics company, dealing with our projects in OYD we had to purchase

different items and different things so, from here I started my own business. I used to deal in

equipments and logistics and I had to but things for the company around, for UN donors, UN

agencies….

Q: So what made you want to be a business owner?

Mr. Khan: Well, as in my own personality was I cannot work for people, I have to come up with

my own ideas, I have to focus on things that I think over, and it made me do things that were

kind of incredible. I started off with many new ideas, many new thoughts, and they came up in

the market with a Bam! In our country. And people started to like those things. And I felt I could

be a very good business man rather than a job person, so I felt I should stick to business and I am

doing good business these days,.

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Q: Which business do you want to talk about today?

Mr. Khan : Well I would prefer to talk about Roshnai Printers, Roshnai Printers, is something

new for me, a new baby. I started it in 2011, its basically a printing agency, which prints books,

magazines, cards any type of printing materials for the government, schools, colleges, agencies

and everybody around. It’s a one stop solution for everybody. I started it from a very low level,

as in I used to get work from market, as in if somebody had to print something I would take that

job from them, and I would go to different printing companies, and I would do that printing job

for them. This made me learn more about printing, as what printing is , how we should do

printing, how the machines are how they work, whats the raw material being used, labor,

electricity and loads of other things. After that I purchased my own machines, my own set up my

own employees, I started off with a government tender, as in I had to print around 8,000 books

for the government, so this is how I started and currently I am focusing on diversifying this

printing agency, as in getting into other medical equipment, the printing of medical equipment,

medicines, brochures, guides and many other things.

Q: So when you started this business, how did you finance for this business, how did you start it,

where did you get the money from? And how much did you start with?

Mr. Khan: Well I had previously worked for 2 years, as I was running two small enterprises,

small businesses which made me, earn some money and I saved that amount. Secondly I started

from a very, small amount as in, maybe it would be a thousand pounds? And I kept outsourcing

different printing jobs to people who had the industries in market. As in I was acting like a

middle man. This made me learn the mechanism of this industry how it works what are the

needs, what are the basic needs of this industry. What’s the labor raw material and many other

costs it made me learn all that, and then I realized, what the loop holes were and I came up with

my own innovative idea that started working for me, and currently I am doing good as I’m

printing books, which is a very good job currently in demand, and I am glad, I switched over to

this business.

Q: Did you do any market research before starting this business? , Or did you just start it out of

the blue?

Mr. Khan: Well, I did some research for about 6 to 7 months, as in I visited different industries,

all over the country. I researched on their system as in what machines they were using, what

were the market trends, what were the loop holes, what issues were they facing, and what was

the demand in market. And then after the research I chose this one segment, as in printing for

industries, as printing has a vast field of printing on laptops, business card, mobile phones, and

then in all that I chose the printing of books. So after thorough research, I thought about it and I

worked on it, and my research, gave me an idea that I should stick to this business, do the

printing of books.

Q: What motivated you to run a business in the first place?

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Mr. Khan: Well motivation as in, if one if doing a job, you are working for somebody, on his

ideas, on his thoughts, on his base, it kills your mind, it kills your brain, it kills your thoughts.

This is what I think. By running your own business, starting your own opportunity, it gives

opportunities to many other people, as in when ever you start a business you are linked to many

other businesses…it’s a chain, secondly you give opportunity to 10 other

businesses…Everybody can not do a business, one needs to be very clear on his mind , his

thoughts, as in there are many people who are job oriented, many people who are business

oriented, and in my case I am business oriented…

Q: How did you start, grow and establish you business?

Mr. Khan: I was already into different businesses, as in business related to the social sector,

business related to manufacturing, businesses related to consultancies, and logistics… Every big

entrepreneur or business man has switched to 5 to 10 businesses and then at the end there is one

business that clicks for him…I personally believe that diversification is the best solution of a

business man. One should stick to different businesses as in, if one is doing a food business he

should stick to different businesses which are food related. A number of different chains,

connected to one single business. Right now my business isn’t that much established, its getting

established slowly, and gradually, right now I’m in the mid level of establishment. When it

established I will switch over to other different businesses, to grow my business, to grow and

expand. … I started this business from a very small level, before starting this business I studied

about printing, what it is how people do it, then I started meeting people, who were in need of

printing jobs, as in they are printing material to do, I took those jobs as my clients, did them on

different industries in the local market, as a middle man. What happened was the I earned

money, and I learned about the business as in, how it is printed and what are the requirements of

the donors, or people, or clients.. I studied both the clients and manufacturer, and studied all the

loop holes, so from there on I categorized those issues and linked them up and then I started

printing. This is how I started.

Q: What skills did you need, for this business?

Mr. Khan : Strong entrepreneurial skills, because there are already people in this business, in this

industry from 20 to 30 years, and being a new entrant in this business, is kind of difficult as I had

less amount to spend in this business, I did not have a big chunk to invest, so starting from a

small set up, we have to think about different things, work on different things, we have to act

wisely. As in you’re spending a small amount and if you don’t do well, you will be completely

stuck. Secondly I had to communicate with my clients, and with the manufacturers who are

doing these jobs for me. So strong communication skills, entrepreneurial skills, and thirdly I had

to convince both of the parties to earn some profit for myself, I had to take the job on a

reasonable amount, and then I had to get it done by the third party on a reasonable amount, to

save some money for myself. And I was acting as a middle man.

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Q: Did you have a business plan?

Mr. Khan: Yes, definitely, yes. Without a business plan, you can never ever succeed. A

successful business man needs a proper business plan, who should know about his finances, how

much money one has, how one has to spend, in appropriate ways and proper, set up. Now if I did

not have a business plan, I wouldn’t have known about things like, which machinery to buy, if I

had spend it on a wrong machine, I would be stuck. So a proper business plan, proper research,

and proper homework, made me do things quickly and advisedly.

Q: So did you plan on starting small, and growing big later?

Mr. Khan: Well honestly speaking everyone wants to start, from a big level, as in a big setup big

industry. But in my case I had to start from a small level, I had fewer resources, less amount to

spend, so I started from a small enterprise I would call. Right now as in the brand name Roshnai

Printers, its one of the printers known for producing quality printing jobs and working effectively

and efficiently. In this book agency there are around 54 printers in our region. I started in a “D”

category, and now I have reached to “B” category, I still have one more category to get up to.

Q: What’s the size of the business right now?

Mr. Khan: Well the starting point was a small business, as in micro enterprise, but right now I

would consider it as a medium business company. I started off with 2 employees. And currently I

have 54 employees… I started off with one single machine, and currently I have 8 machines. I

still have a long way to go.

Q: Whats the organizational structure? Who does what in the organization?

Mr. Khan : Well I have a team as in a manager who deals with clients, then I have another

manager who deals with the mechanics, and labor. And in between them its me, in my case I

sometimes work myself on a machine like I remember, I was standing for 15 to 16 hours in front

of a machine collecting the paper. Putting it in a machine and then cutting it, it was a sort of

labor, I was short of labor and I had to deliver those books on time so I had to work day and

night. 24 hours day and night. I still remember those days..

Q: So you have these 2 managers and under them are the rest of the employees who do the labor

work?

Mr. Khan: One manager deals with all the clients we have, the other one deals with all the

laborers, and I have third manager who deals with the accounts, logistics as in the raw material,

and other issues… I direct my managers, the managers further on tells the laborers what to do

and how to do it. And in my case I’m the type of person that I talk to my laborers, I sit with

them, I eat with them , I have a cup of tea with them , I even take them to doctors if they are sick,

I help them in terms of money if they have to pay somebody, etc. … I directly communicate with

them to get an idea of what they want, and then in the case of managers, if I have to take some

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strict actions, I do it through them, but for the soft corners, that is the place where I come, and for

the hard stuff I tell the managers to do it, If I have to kick somebody out or something I tell the

manager to do it.

Q: Do you ask your managers for advice, in a way that that may know better than you?

Mr. Khan : Yes I definitely take them on board, when I have to take decisions.

Q: How did you identify and assess your competition?

Mr. Khan: Well what I did was, I got know all of the printers my industry, as there were 54

printers, I got their names, their contact numbers, I got their details as in where they lived, from

where do they belong, which machines do they have, how much in number do they have, how

much labor do they have, I found out anything and everything about those printers. Then I

studied each of them as in what loop holes do they have, what issues they have, I studied all

those 54 ones. Then I came up with a plan, what I did was, I invited all of the owners for a

dinner. I invited everybody and I introduced myself to them that I am this and I would love to see

your industries and all that. Basically my point was to get some socializing, to get to know them;

I started visiting their industries, one to one, I started to study them what loop holes, they have

what are their strong points, then I decided, I came up with a group of people, to whom I had to

stick as in working all alone I could never ever compete with all of them, so what I did was that I

selected, like 4 or 5 printers, with whom I was already friendly, as in I gave them different ideas,

do this do that, and they worked on my small ideas and their businesses started to improve. I had

to build a trust factor with them. After that I started my own set up , and when I was in need of

help I asked them. They started to help me, and then those people who I had identified with loop

holes, I started to hit them, although it was unethical I did it to survive myself, such as I saw that

this one’s machines aren’t working properly, that one’s labor is not working, that printer is using

a third quality raw material, and this is how I started to grab their clients… I got a single machine

initially but it was the best one in the whole market. I hired the best labor in the market, I got the

best raw material in the market.

Q: How did you advertise you business?

Mr. Khan: Through social contacts, my won positive image, secondly I was initially doing

several different printing jobs for different clients, what I did was , I earned a lesser amount, but

I gave them quality work , and on time, so I had already build up some kind of trust factor with

the clients, then when I started with my own machines, I started to do the same with my own

business.

Q: And this was self funded business? No loans from the bank?

Mr. Khan: Exactly, I sold my car, I sold my land, I sold anything and everything I had.

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Q: How did you use the web and social media for your business? Do you advertise through the

internet? How do you use the internet for your business?

Mr. Khan: Well, before getting into those aspects, you have to study your demographics, the

trends and what people want. And in the case of my industry, you won’t find my clients on the

internet, you won’t find them having websites, or working on the internet, since this is a

interpersonal channel business, based on contacts. It depends on the business. .. Mostly people

know about my previous business, what I have been doing, what I did was that I came up with

my new visiting cards, where ever I meet someone I give them my visiting cards, I made small

stickers and I gave it to my friends and they are putting them on their vehicle, Roshnai Printers,

so people can see them everywhere. They ask who’s doing it, Adnan is doing it. This is how I’m

doing the marketing of it. As in branding it to myself.