Socioeconomic Model of Micro and Small Entrepreneurship
by: Sherwin Ragos
A business is an entity that has a distinct personality apart from its creators. It exists because of factors that are inseparable and interwoven. As a system, a business can interact with its environment and adapts itself to the changes it brings. A business should work towards existence, and avoid extinction.
Creation Factors
These factors are the reason for existence. Whether stated formally or informally, explicit or implied, the creation factors are fire within that led to the business existence and continuance to struggle to avoid extinction.
The three corners of the triangle signify the vision, mission, and goals of a business.
Internal Key Players
To unleash the fire within and propel that business towards realization of the vision, mission, and goals, there are internal key players—owners, employees, and customers.
The business’ internal key players are characterized. The owners have entrepreneurial qualities, the employees have the skills and potentials, and the customers have the craving for services for needs and wants satisfaction and benefits.
Core Factors
The arrows signify the interactions that take place. Owner-employee interaction takes place because the owner needs manpower, and employee needs salaries for economic reasons. Employee-customer interaction takes place because the employee is the service provider and the customer is the service receiver. Owner-customer interaction takes place because the owner is interested in the customer’s needs and wants to cater, and the customer is interested of continuous service satisfaction which the owner is in control.
Internal Factors
As pointed in the study, there are internal factors that support the internal key players and the core factors. These are profits, efficiency, and business sustainability. The internal factors are not mutually exclusive. When efficiency is achieved, more profits come in, and these two would sustain the business socioeconomic activities.
External Factors
External environment: market, technological, governmental, and societal exerts pressure on the business. These pressures are in the form of opportunities and threats that the business can exploit or avert. In turn, the business gives back to the environment socioeconomic contributions.
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