Throughout history, man’s existence has been shrouded in a web of complex situations that require a critical approach to problem-solving. The ability of thinkers to proffer solutions to emerging and contemporary problems in society paves the way for business opportunities. Openstax defined entrepreneurs as “problem solvers who proffer solutions using creativity or innovative ventures that exploit opportunities”.
Entrepreneurs fill an essential space in society. More than the ultimate aim of profit, they make life easier through different innovations in the diverse areas of human life. Their role has even become more prominent in a fast-paced world of advancing technological innovation, in which everyday human interaction comes with its fair share of challenges. People continue to look for faster, smarter, and easier ways to accomplish different tasks. This situation creates a perfect opportunity window for entrepreneurs to design new solutions or improve existing ones.
We cannot overemphasise the roles and contributions of entrepreneurs in society. Besides providing job opportunities, they raise the economy’s productivity level and improve people’s quality of life. However, many government policies and business regulations tend to limit the ability of entrepreneurs to perform their roles.
Here, we briefly examine some of the important roles that entrepreneurs play as problem solvers in society.
Drivers of economic growth
Innovations bring high-value contributions to the economy. In the United States of America, small and medium-scale enterprises (SMEs) make up about 44% of the total GDP and about 40% of total national earnings in emerging economies. In Nigeria, SMEs contribute 48% of national GDP, account for 96% of businesses and 84% of employment.
The increased competition among entrepreneurs to attract the bulk of the customer base to their products helps to drive up economic activities. Increased innovation and sales subsequently increase the tax base for the government, hence more resources for development and capital infrastructure.
Through the creation of improved products and services, they increase the level of productivity of an economy, helping to create a free market economy that thrives on free entry, and demand and supply pull.
Employer of labour and job creation
Amidst economic uncertainty, entrepreneurs lead the charge in the provision of gainful employment- not only to themselves but also to most of the population. They set off a value chain of jobs (labour, supplier of inputs, supplier of industrial equipment, marketing, traders, and many more) with their emergence in the economy. In developed and developing economies, entrepreneurs provide opportunities for fresh graduates to gain industry experience, especially in developing countries with high unemployment rates.
With new products springing up from the innovation of entrepreneurs, new jobs with special skills requirements are emerging in the market. In the Information Technological (IT) sector, innovation is creating career paths that were not in existence in the past decades. While it replaces old jobs, it creates new and more jobs alongside.
Poverty reduction through wealth creation
According to the World Bank, about 9.2% of the world, or 689 million people, live in extreme poverty (defined as living on less than $1.90 a day). This worrisome situation prompted the priority for Zero Poverty in the Sustainable Development Goals (SDGs) to seek a solution to eliminating poverty in the world. One of the effective tools for addressing this global concern is entrepreneurship. Entrepreneurship is a cure-all approach to poverty reduction. Economic activities generated through entrepreneurs have a multiplier effect and stimulate the distribution of wealth to more people and geographic areas, in the country’s interest.
Increased social impact
Brand commitment to social development through corporate social responsibility (CSR) is setting the pace for individual and government commitment to sustainability. According to a study by Nielsen in 2015, brands with “a demonstrated commitment to sustainability grew 4 percent year over year, compared to less than 1 percent growth for their competitors”. This reflects that consumers are now concerned with the social impact of brands they patronise.
This has necessitated the commitment of entrepreneurs to set aside a portion of their profit to contribute to providing lasting solutions to social problems. Through sheer grit, they are able to identify the most pressing societal concern and gain the attention of the public and relevant stakeholders. Although the intention might be geared towards profit making and brand strategy, the effects of their social contribution project have improved the quality of life of beneficiaries and their host communities.
Entrepreneurs are critical to the innovation and ease of life we enjoy today. Their innovation in problem-solving transcends them. The quality and sustainability of innovative solutions defined successful entrepreneurs. They adopt unconventional approaches to problem-solving, challenging the old system with fresh ideas and technicalities. Government must continue to create an enabling environment for entrepreneurship in order to stimulate greater prosperity for everyone.
Photo by Olu Eletu via Iwaria