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Running head: SUMMARY: INNOVATION AND ENTREPRENEURSHIP

Summary: Innovation and Entrepreneurship
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SUMMARY: INNOVATION AND ENTREPRENEURSHIP

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Summary: Innovation and Entrepreneurship
Introduction
According to classical economists, economies have a tendency to maintain equilibrium as
they optimize their results in incremental growth with time. However, Peter F. Drucker notes that
an entrepreneur upsets and disorganizes this nature by generating wealth through processes
described as creative destruction. These actions and activities involve dealing with uncertainty
and unknown and having the capability to exploit change respond to the changes in an intelligent
way. Drucker notes that to think that everyone that starts a new business is entrepreneurial is a
misconception. People take the risk of starting a shop or a franchise but are not creative or
innovative to develop something new or create new customer value. Therefore, through his
world-renowned book, Innovation, and Entrepreneurship, Peter Drucker introduces the
foundations of an entrepreneurial economy. Drucker notes that most of the successful
innovations in the world are as a result of a calculated plan of actions that needed both strategy
and forethought and not a stroke of genius. The author notes that while different ways exist on
how to approach innovation and entrepreneurship, they require close analysis and strategy. Using
world renowned success stories like McDonald's', the book highlights how these skills are
applied in both public and private sector organizations. This essay offers a summary of the key
points and processes to innovation by entrepreneurs that the author wants the readers, and
practitioners to understand to build an entrepreneurial economy.

SUMMARY: INNOVATION AND ENTREPRENEURSHIP

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Parts of the Book
Innovation and entrepreneurship are divided into three main parts: "The Practice of
Innovation", “The Practice of Entrepreneurship, and “Entrepreneurial Strategies “. In the
introduction, Drucker uses the example of the United States to describe innovation and
entrepreneurs in relation to its economy. The book defines innovation as a mean through which
entrepreneurs exploit change with the aim of creating new products and business opportunities.
Entrepreneurs by their nature create a market niche while at the same time fill consumer needs.
Part 1: The Innovation Practice
Drucker notes that successful innovative practice is based on calculated hard work
through systematic actions and plans by entrepreneurs. Drucker introduces and uses the systemic
innovation model as a framework that entrepreneurs can use to exploit innovative opportunities.
Accordingly, his principles of innovation need entrepreneurs to analyse opp...