Entrepreneurs in Illegal Business
Chapter 3: Entrepreneurial Leadership and Management
3. Entrepreneurial leadership and management Organising the business of crime requires a market-oriented approach, where market share is important. There are markets for heroin, cocaine and other drugs. There are markets for illegal weapons and stolen cars. There are markets for illegal gambling, prostitution, protection and money laundering. Whatever business a criminal organisation is in, the market share is important to establish, sustain and increase. Typically contributions of an entrepreneur are to develop new markets and increase the market share on existing markets. Under the modern concept of criminal marketing, markets are people who are willing and able to satisfy their needs. An entrepreneur is creative and resourceful in satisfying invisible and visible demand. An entrepreneur can create customers or buyers. This makes an entrepreneur different from an ordinary businessman who mainly performs traditional functions of management. ENTREPRENEURIAL JUDGMENT IN DECISION MAKING Why does a criminal entrepreneur choose to organise a criminal business enterprise in order to exploit a market opportunity? Alvarez and Barney (2007) argue that entrepreneurial opportunities can be exploited in a variety of ways and seek to understand the conditions under which organising an enterprise is the most efficient way of exploiting a particular opportunity. Opportunities to create new economic value exist because of demand for goods and services in illegal markets. Entering an illegal market as an entrepreneur is based on the assumption that there are competitive imperfections reflecting changes in technology, demand or other factors that individuals or groups in an economy attempt to exploit....
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