Peter works as senior business analyst in the loans department in a high performing commercial bank in Fiji.
QUESTION
Peter works as senior business analyst in the loans department in a high performing commercial bank in Fiji. Over the past months, he received loan applications from three business entrepreneurs. These three entrepreneurs have new businesses with strong potential. Nevertheless, Peter contends it is important to look at more than just the business itself; the individual also requires a closer examination. The three entrepreneurs are: [1] James, owner of a small delicatessen located in the heart of a thriving business district; [2] Manoa, owner of a 10 minute oil-change-and-lube operation; and [3] Tuamoto, owner of a bookshop that specializes in bestsellers and cookbooks. Peter has had the bank’s external consultant, Dr Tom, interview each of the three business entrepreneurs and after a couple of hours of discussion can usually assess a person’s entrepreneurial characteristics. In the past, Dr Tom has recommended 125 people for loans. Out of these only three, have failed in their business ventures. In general, the success rate is much higher than that for commercial loans. Following is Tom’s evaluation of the three individuals whom he interviewed.
Characteristic
James
Manoa
Tuamoto
Creativity and innovativeness
M
H
M
Independence
H
H
H
Self-confidence
H
H
H
Tolerance for failure
H
H
H
Integrity and reliability
H
M
H
Tolerance for ambiguity
L
M
H
Persistent problem solving
M
M
H
Drive to achieve
M
H
M
Perseverance
H
M
M
Initiative
M
H
M
H = High
M = Medium
L = Low
Based on the above case study, answer the following 3 questions
(a) Out of the three applicants, which one do you think comes closest to possess the qualities of an ideal entrepreneur. Explain. (2 marks)
(b) Out of the three applicants, which applicant would you recommend that the bank lend money? Assume each has asked for a loan of $75, 000. Justify your answer. (2 marks)
(c) What can these three business entrepreneurs do to improve their entrepreneurial profile and their chances for success. Explain. (3 marks)
ANSWER
Evaluating Entrepreneurial Potential: Case Study Analysis
Introduction
This essay aims to analyze the characteristics and evaluations of three business entrepreneurs, namely James, Manoa, and Tuamoto, as conducted by Dr. Tom, the bank’s external consultant. By assessing their entrepreneurial qualities, we can determine which applicant possesses the closest qualities to an ideal entrepreneur, recommend the most suitable candidate for a loan, and provide suggestions to enhance their entrepreneurial profiles and increase their chances of success.
Evaluation of Entrepreneurial Qualities
Closest to the Ideal Entrepreneur
Among the three applicants, James appears to possess the qualities that come closest to those of an ideal entrepreneur. Dr. Tom’s evaluations indicate that James demonstrates high levels of self-confidence, integrity, reliability, tolerance for failure, and perseverance. These qualities, combined with his creative and innovative approach, make him an ideal candidate for entrepreneurial success. James’ ability to adapt to ambiguity, coupled with his persistent problem-solving attitude and initiative, further reinforce his potential as an ideal entrepreneur.
Recommended Loan Recipient
Considering the loan request of $75,000, the applicant most suitable for lending is Manoa. Dr. Tom’s evaluations reveal that Manoa possesses high levels of independence, self-confidence, integrity, reliability, and a strong drive to achieve. These characteristics indicate his ability to manage and run a business effectively. Although Manoa scores medium in some entrepreneurial qualities, his overall profile suggests a reasonable chance of success in his 10-minute oil-change-and-lube operation. With proper financial support, Manoa has the potential to establish and grow his business successfully.
Enhancing Entrepreneurial Profiles and Chances for Success
To improve their entrepreneurial profiles and increase their chances for success, each applicant can focus on specific areas:
James: Despite possessing several key entrepreneurial qualities, James should work on developing a higher tolerance for ambiguity. This can be achieved through exposure to diverse business situations, seeking mentors, and engaging in continuous learning to enhance adaptability.
Manoa: While Manoa shows promise, he should aim to strengthen his persistent problem-solving skills and initiative. By further developing his ability to identify and address business challenges, and by taking proactive steps to seize opportunities, Manoa can enhance his entrepreneurial profile.
Tuamoto: Tuamoto can improve his chances for success by focusing on creativity and innovation. By exploring ways to differentiate his bookshop and adapt to changing market trends, Tuamoto can attract a wider customer base and stand out in the industry.
Conclusion
Based on Dr. Tom’s evaluations, James possesses the qualities that come closest to those of an ideal entrepreneur. However, considering the loan request, Manoa is recommended as the most suitable candidate for lending due to his combination of high independence, self-confidence, integrity, reliability, and a strong drive to achieve. To enhance their entrepreneurial profiles and increase their chances for success, James can work on tolerance for ambiguity, Manoa can focus on persistent problem-solving and initiative, and Tuamoto can emphasize creativity and innovation. By addressing these areas, they can further strengthen their entrepreneurial capabilities and thrive in their respective businesses.
