Entrepreneurship is defined as the ability of an individual to discover, assess, and exploit opportunities (Shane and Venkataraman, 2000). Entrepreneurship is often explained by scholars under different titles such as entrepreneurial factors, entrepreneurial functions and entrepreneurial behavior that is also known as entrepreneurial spirit. Entrepreneurial factor is a new factor that is added to factors of production like capital, labour and land and it is explained on remuneration basis through income for the entrepreneur along with the shortage of people with entrepreneur capabilities. The entrepreneur function explains that entrepreneur as a function involves the discovery and exploitation of opportunities or the creation of enterprise. Entrepreneurial behaviour is emphasized as the ability of an entrepreneur to manage and combine innovation, risk taking and proactiveness (Miller, 1983).
The early entrepreneurship theory was first proposed by Richard Cantillon an economist (1680-1734) who defined entrepreneur as an individual that purchases inputs of production at specific prices to combine and form a new product. He proposed that entrepreneurs are the most active among 3 agents such as landowners, hirelings that connect producers with customers (Murray, 1995). However, Jean Baptise Say (1767-1832) improved the theory of Sir Richard Cantillon by further adding that entrepreneurs bring people together in order for productive items to be built (John, 2000).
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Afterwards, Frank Knight (1885-1972) wrote a book titled "Risk Bearing theory" where he introduced the risk-taking dimension as the main characteristic of entrepreneurship. The theory also considers uncertainty as a factor of production that prompts entrepreneurs to act in anticipation of future occurrence (Jeff et al., 2001). Frank Knight (1885-1972) also built his theory on the early economist theory (such as Richard Cantillon and Jean Baptise Say). Later on, Alfred Marshall (1980) explained that land, labour, capital and organisation which are the four factors of production are all driven by entrepreneurship that brings these factors together to deliver values to customers. Alfred Marshall (1980) also explained that a deep understanding of the industry, good leadership skills and a better demand and supply forecast are the characteristics of a successful entrepreneur. Alfred Marshall further stated that possession of these skills is the key determinant of the success of an entrepreneur. Although many economists have also modified the theory of Alfred Marshall by formulating models that position entrepreneur as the fourth factor of production in the place of organisation (Nayab,2011).
Max Weber (1864-1920) a Sociologist proposed that entrepreneurship holds social cultures as the driving force of entrepreneurship. He stated that the society plays a great role on the way entrepreneurs perform as entrepreneurs become a role performer in conformity with the role expectations of the society where entrepreneurs operate and such role expectations are often base on taboos, customs, and the beliefs of the society. Max Weber further implicated religion as a major driver that greatly impact the way entrepreneurs act and he stressed the impacts of capitalism that highlights economic freedom among entrepreneurs (Nayab,2011)..
Mark Casson (1945) is of the opinion that entrepreneurship is as a result of a conducive economic condition. In his book titled "Entrepreneurship, an Economic Theory", Mark Casson (1945) outlined economic factors that encourage or discourage entrepreneurship which are; tax policy, industrial policy, ease of raw materials availability and access to finance, access to market conditions information, the availability of infrastructure and technology and marketing opportunities (Nayab,2011)..
Joseph Schumpeter (1949) theory of innovation proposed that there are 3 major characteristics of an entrepreneur and they include innovation, creativity and foresight. Joseph Schumpeter (1949) stated that an individual is said to be an entrepreneur when such person creates new products, introduces new process for making products, develop markets for his products, identifies new source of raw materials and establishes new ways of making things. However, Schumpeter's innovation theory neglected the risk taking ability of an entrepreneur and the skills of an organisation and he placed an undue importance on innovation (Nayab,2011)..
According to Israel Kirtzner (1935), postulated that entrepreneurship is the transformation of spontaneous learning to conscious knowledge that is driven by the prospect of some gain. Alertness to recognize opportunities by entrepreneur is a typical characteristic of entrepreneur rather than innovation. Israel Kirtzner entrepreneurship models explains that; entrepreneur most often subconsciously identify opportunity to earn money by obtaining resources or producing gods and selling it, entrepreneur finances his business through money borrowed from capitalist, the funds is been used by entrepreneur to fund his business and the entrepreneur pay back the money borrowed from capitalist with interest and retaining his own profit (Nayab,2011)..
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Harvey Leibenstein (1922-1994) considered entrepreneur as an individual that identifies and fill a gap ("gap-filler"). He further indentified 3 traits in entrepreneur that include; an ability to identify the trend of markets, developing products that are in demand but not in supply and identifying activities that are profitable (Nayab,2011)..
David McClelland (1917-1988) in his book titled "Theory of Achievement Motivation", David explained that there are 3 motives that people have for accomplishing things and these motives involve; the need for power, self affiliation and the need for achievement. The need for power and achievement has been implicated to be the major drive for entrepreneurship. David believed that entrepreneurs are individuals that do things in a better way and makes decision in the time of uncertainty. David's research revealed that traditional beliefs do no deter entrepreneur and the dream to achieve big things overpowers monetary drive in an entrepreneur.
Peter Drucker (1909-2005) believed that the behaviour of an entrepreneur, resources and innovation are the keys to entrepreneurship. According to Peter, entrepreneurship ensures an increase in satisfaction for customers from resources creates new values and combines materials in a new productive way(Nayab,2011)..
In the early years, literatures on leadership were predominantly bothered on theoretical concerns that were based on hierarchic models from industrial firms. In these hierarchical models, leaders were expected to maintain efficiency and discipline as they oversaw production and employees. Followers were given not opportunities to think creatively or to generate ideas to improve their ways of working but instead, leaders were only giving orders to workers who are expected to obey orders of the authoritarian leaders obediently. Most of the early theories of leadership were based on traits or the styles of leaders where theorists proposed that there are certain physical and psychological characteristics predisposing individuals to leadership.
Based on Trait and Great Men Leadership theories, trait theory of leadership believed that leaders are born but not made. The theory further proposed that a leader must have some superior qualities that would distinguish him from his followers (Bass 1990). These superior qualities could be some set of intellectuals, interpersonal and physical characteristics like good posture, ability to speak firmly, ability to act confidently, task-oriented and assertive skills. The trait theory of leadership believed that these characteristics are inherent in these leaders from birth. However, leadership was explained by great man theory by through a focus on the greatness of the leader. The great man theory postulated that some men due to their birth order, family background, upbringing and education, they are predestined to be leaders (Bruce et al., 2006).
Charismatic leadership theories believed that charismatic leaders play a significant role in politics, economics, and social life of their environments throughout history. For example, leaders like Martin Luther King Jr., Adolph Hitler, as well as musicians, politicians, and actors have been said to have charismatic influence on their followers. Charismatic leadership theory proposed that apart from inspirational skills that charismatic leaders possess, charismatic leaders also have the ability to generate unusual passionate reactions in their followers as they emerge in times of crisis, displaying their magical endowments to fulfill the unmet emotional needs of their completely trusting and submissive followers (Bass 1990).
According to style theory of leadership, the ways by which leader exercise their influences on their followers is said to be a leadership style. The style theory grouped leadership style into three main categories that include; autocratic, democratic and abdicratic styles. The autocratic style is the type of style in which leaders are known to be highly directive and they do not allow followers to make decisions or be involved in decision making process. Autocratic leaders do not usually intimate their followers with reasons on why they make some certain decisions and as such, followers are expected to act as these leaders direct them to. Autocratic style is instigated by the need to maintain a firm control of followers through this expression of their authoritarian style. However, the democratic leadership style is the style that believes in followers' participation in decision making where they are given opportunities to vote decisions and the leaders' decision may be based on decisions of majority of followers. The abdicratic that is also referred to as Laissez faire leadership style give power or autonomy to their followers. Leaders only interfere in abdicratic style when there is need to provide information to followers.
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Situational theory is a model of leadership that put into consideration the leader, the followers and situations, proposing that leadership is based on time, places, and circumstances (Bass 1990). Situational theory believes in 2 ideologies that say;
1. Situation of any kind will determine the leadership qualities and the leader of such situation.
2. The qualities of leadership of an individual is the product of the previous leadership situation that molded such a leader.
Situational theory disagrees with the trait and great man theory because situational theory believes that 95% of human progress is unconnected to great individuals but individuals like Mahatma, Gandhi and Martin Luther King Jr. perceived to be great leaders actually appeared at a critical historical moment of socially value causes and they devoted themselves to those causes, contributing to those causes and profiting greatly from the works of others (Carson 2003).
Contingency Theory of Leadership proposed that leadership is response of followers to the leadership style that a leader adopts. Fiedler (1967) explained that two factors such as task orientation or relationship orientation motivate leadership style that leaders adopt. Where some leaders are interested in followers getting task done, others may be interested in relationship with their followers. According to Fiedler (1967), relationship between the leaders and their followers, task structure and the power of leaders contribute to leaders influence.
In transactional and transformational leadership theory where the transactional leadership style is a task-oriented and directing style which ensure followers accomplish finite goals, and where leaders move to win their followers compliance through various approaches that include offering rewards, threats and punishment, transformational leaders are leaders that have a strong sense and ability to attract loyalty and commitment from their followers (Harris and Sherblom 2002).
Defining and distinguishing entrepreneurship and leadership as separate theories are often not easy to do. Where leadership involves the process by which others are influenced willingly and legitimately to achieve shared goals. But entrepreneurs do not only identify opportunities but they also organize and manage resources to carryout their goals and visions. It is often possible to identify overlaps between leadership and entrepreneurship through various theories in the field of management from various authors. Entrepreneurship is proposed to be just a mere leadership within a special environmental situation or context. Entrepreneurship has been described as a special case of leadership that distinguishes it from other forms of leadership with respect to individuals that establish companies rather than those that manage already existing firms (Sudam, 2011).
Entrepreneurship in relation to leadership is a new model of leadership that is known as Entrepreneurial leadership that involves people that understand themselves and the environment in which they work and thus shape opportunities that create value for their stakeholders, organisations and society as a whole. Entrepreneurial leaders are most often driven by intent social, environmental and economic opportunities would be created simultaneously. Challenges like lack of resources, high uncertainties do not discourage entrepreneurial leaders but instead, entrepreneurial leaders take actions by experimenting with new solutions to solve old problems. Through combinations of self reflection, analysis, resourcefulness, creative thinking and implementation, entrepreneurial leaders identify methods to inspire and lead others to tackle problems (Danna et al., 2011). Recently, theories have started identifying relationships between entrepreneurship and leadership due to the fact that hold similar notions with conceptual overlaps (Perren and Burgoyne, 2002). According to Perren (2000), he explained that one can simply consider an entrepreneur offering leadership while a leader needs an entrepreneurial flair. The concept of entrepreneurial leadership though at an embryonic stage, Gupta et al., 2004 tried to explain the attributes of entrepreneurial leadership that involve intellectual stimulation, creativity, ambitious foresight, unorthodox thinking and decisive mindset. Also, leadership and vision as been noted to be an important facilitator of entrepreneurship (Timmons,2007) and thus, entrepreneurship and leadership are deeply interconnected (Jensen and Luthans,2006) and in order to be a successful entrepreneur, there must be a need for an individual to possess leadership skills (Colbert,2003). Furthermore, entrepreneurship and leadership both abilities such as drive, passion, vision, risk acceptance, personal drive and innovation (Perren and Burgoyne, 2002). In the research conducted by Vecchio (2003), Vecchio integrated the theory and research of entrepreneurship into a well established traditions of leadership and management and he concluded that many constructs that are used in entrepreneurship area are also seen within the mainstream of leadership theory, thus leading to the conclusion that it is more cogent to see entrepreneurship as a type of leadership that takes place in a specific context.
At the micro-stage of business, entrepreneur does not only act as a marketer, sales representative, financial controller, public relations officer but also, an entrepreneur at the micro stage of business act as a leader (Cope,2001) and thus, entrepreneurship becomes a distinct form of leadership during the growth process of an organisation. Entrepreneurial leadership in firms obtains its formal legitimization from the leader's status, profession and leadership capabilities (Guo, 2009). Entrepreneurial leadership can't be based on power and hierarchy although the position of leader legitimizes entrepreneurial leadership. But the hierarchical chain of command and control are only based on the skills of individuals which for example involve achieving goals innovatively and organizing the resources needed to achieve goals (Skodvin and Andresen, 2006). Through an increasing flow of information, entrepreneurial leaders are able to recognise and evaluate opportunities (Hansson and Monsted, 2008).