Aspects regarding the development of the entrepreneurship in Romania.

Mocan, Marian ; Popa, Horia ; Izvercianu, Monica 等

1. INTRODUCTION

The economic development of Romania after 1990 and especially from the last decade has been directly connected to the perspective of joining the European Union. From the moment Romania effectively joined the EU on the 1st of January 2007, the development has been more rapid not only because of the existent opportunities from the Romanian market but also because of the development gap between this one and the Western countries. Although Romania is part of the world economic circuit, some evolutions have been in contradiction with the global evolution.

Economic evolution between 2000-2007 was positive (see table 1). According to the data provided by the National Bank of Romania and by the National Statistics Institute (NSI 2007), a continuous improvement of the analyzed base indicators can be observed (economic growth, inflation rate and unemployment rate).

This evolution has lead to a substantial economic revitalization and to creating some better living conditions for the country's population. It is estimated that, from 2010, Romania will enter the Schengen area and from 2014 it will adopt the Euro as its national currency. As regards the level of the Gross Domestic Product (GDP), in 2007 it has reached the sum of 121 billions [euro] (from 97 billion in 2006), meaning 5.720 [euro]/person. It is a very dynamic growth if we take into account the fact that, in the year 2004 the GDP was of 2.800 [euro]/person and in the year 2000 it was only of 1.800 [euro]/person.

The sectors that have had a substantial growth in the last period, were the ones from the fields of constructions, of Communication and Information Technology, of automotive and of the real estates.

The arrival of 2 important companies (Nokia in Cluj Napoca and of Ford in Craiova) has lead to an unprecedented activation of the Romanian economy.

2. THE ENTREPRENEURSHIP IN ROMANIA

The strong economic development from the last period has brought to the entrepreneurs new problems with which they haven't been used until now. The most important problems that they must face regarding the market are the following: a--a work force crisis in almost all of the sectors of the national economy and in all the professions and jobs. The most affected sectors are constructions, commerce, hotel industry and processing industry. The work force crisis is more accentuated in big cities such as Bucharest, Timis, Sibiu, Cluj, and Constanta. According to some studies realized by some recruiting companies, approximately half of the Romanian companies have aim at increasing their number of employees in the following 3 months; consequently, this pressure regarding the lack of work force will grow even further. The reasons that have led to this crisis are the following:

--Massive migration of the work force towards the developed countries of the European Union even before but also especially after the year 2007. It is estimated that approximately 2 billion persons are hired in the developed countries of the European Union, but especially in Spain and Italy, in the fields of constructions, social services, industry and tourism. The main reason of the massive departures is given by the difference between the salaries from these countries and from Romania. In Table 2, the level of the net salary from Romania in the last 3 years and the predictions for the next 3 years are presented according to the NSI (2007).

--Rapid growth of the Romanian investments, but especially of the foreign investments. In the "Study Regarding the Investment Attractiveness of the South-Eastern Europe 2008" made by Ernst & Young, Romania, is on the first position with an attractiveness level of 52% (Badarau I, 2008). From the 216 interviewed managers, most of them see Romania as the most favorable country for establishing businesses. The comparison has been made between Romania, Turkey, Bulgaria, Greece, Croatia, Serbia, Bosnia Herzegovina and Cyprus.

b--Bureaucracy and the taxation are some other reasons of worry for the entrepreneurs. The high number of forms that must be completed, the number of accounts towards which they have to pay a lot of contributions, the deficit activity of the state institutions that work with entrepreneurs lead to waste of time and to the increase of the entrepreneurs' feeling of uneasiness. It is a real problem already acknowledged by the government that is trying to make a clear evidence of all these taxes and duties and to diminish their number.

Although, globally, from a fiscal point of view, Romania is an attractive country, the high number of taxes and duties, sometimes divided in ridiculous sums lead to an exaggerated waste of time and resources for the companies.

c--The legislation from the work code gives an extremely high power to the employers in comparison with that of th employees. The modifications of the Work Code from 2004 and 2005 have lead to some extremely restrictive stipulations for entrepreneurs regarding sacking, the work period, the vacations and also other rights of the employees. By changing the work code, an attempt was made to implement some European Union specific norms, but they would only be valid for a country with a developed economy, and not for one as Romania has. Given the reduction of the unemployment rate and the increase of the work force demand, the possibilities for negotiation have significantly diminished.

d--Joining the European Union and the necessity of accomplishing the specific norms that are in place, has lead to a lot of challenges and important changes for the entrepreneurs. Eliminating the customs taxes for the Romanian products is of good omen. The European market, a market of 462 millions people, will be directly accessible to the Romanian products with no restrictions. This is also valid for the European products that want to reach the Romanian market. The European legislation regarding the protection of the environment is extremely restrictive and many of the Romanian companies would not be able to obesrve it. Already in 2007, 14 104 companies went bankrupt in Romania (Barzoi V, 2008). Most of the bankruptcies from 2007-5 801 companies, meaning 41% of all--have been registered in the commercial field (retail, lump commerce and distribution), and this is due to the great chains of retail that entered the market. For the year 2008, the international and the native retailers have announced the opening of 56 supermarkets, 29 hypermarkets, 2 stores type cash and carry and 77 discount shops. On the following places for bankruptcy, are the companies from the agricultural field (1093 companies), from the field of constructions (1066 companies) and of the food and drinks industry (1064 companies).

the optimism of the Romanian entrepreneurs, is quite high.. In a research made by Eurochambres Economic Survey (Vaschi M, 2008), a percentage of 53.8% from these think that the business environment will evolve positively in 2008, only 18.9% think that the business environment will become worse, while 27.3% think that there will be no major changes in comparison with 2007. More optimistic than the Romanians, were only the entrepreneurs from the Czech Republic--54.5% and from Bulgaria 66.4%, while the weight of the skeptics is higher in Hungary (23.8%) and Slovakia (25.5%).

3. SOLUTION PROPOSED

Adapting a firm's activity to the demands of an ever-changing market must be done by using top notch changing management. It is necessary that a firm develops SMART objectives (Specific, Measurable, Adequate, Realistic, and Tangible) together with new ideas, enthusiasm, and a strong leadership (Mocan M. 2007). The stages that a transformation process must have and the conditions it must uphold are:

a--Defining your purpose and objectives. This is done by starting from the idea that every firm is different and every transformation process is unique. The essence of transformation must be based on the enhancement of the firm's performances and on reaching a superior level of development. This must lead to in-depth transformations based on radical changes.

b--Designing a graph of change development. This is achieved by clearly defining the necessary activities for this process, starting from the objectives defined at the previous step and deciding which the priorities are.

c--Defining milestones. We refer to the 'breaking' of the changing process into several pieces so that the changing process will be accepted more easily by the organization members. an evaluation and monitoring of the changes performed so far will be made at these milestones; changes can be made according to the problems that occurred during the process. Having short term successes can boost the employees' moral and make them get more easily involved in the future changing process.

d--Using efficient communication and efficient leadership. The changing process can be easily accepted if its necessity is understood. A direct, efficient communication can lead to a better understanding of the benefits, of the necessity of this process and of the important impact it will bring to the firm and its members. It is best if the emotional side of things is accentuated-like, for instance, the need for adapting to the new conditions.

e--Maintaining the rhythm and stimulating employee enthusiasm. The two aspects (rhythm and enthusiasm) are interdependent. A process that takes too long leads to loss in patience and therefore to loss of enthusiasm on behalf of the employees. They need to be periodically stimulated by encouraging them to participate with ideas to the changing process. It is not necessary for them to give big solutions, just solutions to small scale processes. It can be said that 4 kinds of ideas are important, those who answer the following questions:

--Why is change needed? Ideas that are born from the motivation of change are essential both on a large as on a small scale.

--What needs to be changed? In this case both the major and the minor processes that will be changed must be defined.

--Who needs to be changed? In this case we are talking about the people, their functions and their place in the firm.

--How does it need to be changed? Practical solutions that are utilized during the whole process are the most valuable out of the whole changing process.

d--Personalizing changes and increasing employee learning capabilities. In order to increase conviction and trust in the employees a firm must find and promote in its turn new models that promote the new changes and values towards which the firm is heading. About the learning abilities of adults: they depend on individual personalities as well as on the internal values that the firm promotes in the organization. A very high success rate offers the employees the possibility of learning new things and then attributing specific tasks to this new knowledge.

4. CONCLUSION

Romania is in a very favorable point in its development now. Joining the EU was an opportunity for the economical environment in this county. During this period entrepreneurs get confronted with new situations that about which they have no experience. The way in which they will deal with the problems depends on their personality, on the knowledge they have or on the knowledge they have and their courage to change the things that no longer work.

5. REFERENCES

Badarau I (2008), Romania is nr. 1 target for the foreign investors, Ziarul Financiar, 18.04.2008, pag. 3.

Barzoi V (2008;, Over 14.000 out of the market, Capital, nr. 5, febuary 2008, pag. 4

Mocan M et al (2007). Management, Eurobit Publisher House, ISBN 978-973-620-307-7, Timisoara Romania

National Statistic Institute (2007) Statistics Annuary of Romania, Bucharest

Vaschi M (2008), The young's rise the level of salaries on the market, Capital, nr. 14, April 2008, pag. 1

Tab. 1. Evolution of the macro-economical indicators

Year Economic Inflation Unemployment
 growth [%] rate [%] rate [%]

2000 2.1 40.4 10.5
2001 5.7 30.3 8.8
2002 5.1 17.8 8.4
2003 5.2 14.1 7.4
2004 8.4 9.3 6.3
2005 4.1 8.6 5.9
2006 7.9 4.67 5.2
2007 6.0 6.57 3.9

Tab. 2. Level of net salary

Year 2005 2006 2007

Salary [[euro]] 204 243 313

Year 2008 2009 2010

Salary [[euro]] 338 378 417