Shari’ah Frameworks of Entrepreneurship

By:
Prof. Dr. Mohd. Ma’sum Billah
masum@applied-islamicfinance.com
masum2001@yahoo.com
+6019-3699542

INTRODUCTION

Entrepreneurship as a very important aspect in today’s management area defined as: a person of very high aptitude who pioneers change, possessing characteristics found in only a very small fraction of the population in commercial view. As the growth of Muslim leader in different economic area especially in the management position, it will be raise a question: what is the sharia framework of Islamic entrepreneurship and leadership in order to guide as to achieve our goal within the Islamic perspective. And of cause for the answer we have to learn from our perfect prophet Muhammad (s.a.w). We have to learn the way prophet did as a leader and an entrepreneur. And other related role that how prophet acted.

Thus in this article we come to discuss the Islamic framework of entrepreneurship base on the study of Prophet Muhammad’s leadership.

It is sure to be understood that Islam is not only a form of worship or religion duties. Islam is a complete way of life (al-Din) for those of us who acknowledge the oneness of Allah and the dignity of Muhammad s.a.w as His final and greatest Messenger. The basic rule in the Islamic storyboard (seerah) is the study of leadership from the Muslim perspective. Thus to learn the Islamic way to be leader and entrepreneur we should go to learn from our prophet. At first, let’s see the

Prophet Muhammad’s Organizational Framework.

Prophet’s (s.a.w) leadership paradigm is used as a benchmark for organizational development. We can see the following model.

Within the framework of the Prophet of Islam’s leadership paradigm, there exist a pragmatic set of workable guideline foe hands-on managers to abide by. The formula adduced for the benefit if t he practicing manager is three plus five （ 3+5 ） :

The first important posture is mutual consultation (syura). It is a methodology for leader to solve problems, initiate solution or map out a strategy.

The framework for action includes a combination of the main elements of alignment, attunement, empowerment, resulting in synergy.

When all of these three elements have been achieved, then we have al-falah, which gives synergy.

Within the framework, the managerial leader has to be middle of the methodology and personal value system that substantiate and contribute to the realization of the important vision of greatness.

And let’s see the three (3) postures of Islamic leadership:

And we should see that these three postures work with the five principle amplifying important aspects of Islamic value system. And the five principle systems are:

In order to get excellent and success in management we have to try to fulfill these five principles in our practices. Now let’s see how Prophet Muhammad implements them in the practice as a manager, as a leader and also as an entrepreneur.

PERSONAL INTEGRITY (Al-kamal asy-syakhshi)

Integrity is the special projecting the spiritual side of leadership. It is a value based principle focus on to character and beliefs rather than on techniques and technology. The managerial leader of integrity in the Islamic is classified as the servant leader, with him being the servant only of God Almighty. Acting as Allah SWT’s designated khalifah on the earth.

Integrity is basically referred in the leader’s ability to keep promises and trusts. Islam emphasizes this. The promises are with God, the ummah, and every other being he interacts with the community of people. The sum total of keeping one’s promise is very important since it shows one’s core character. Thus when a leader promise to do something, he should feel accountable for its due performance.

“And fulfill the promise. Surely (every) promise shall be questioned about.”

Bani Israil, 17:34

Keeping trust implies that is a great sin to commit a breach of trust. Aishah (r.a) narrated that the prophet (s.a.w) had bought some foodstuff on credit for a limited period and mortgaged his armour for it, and when the time came for settlement, the prophet (s.a.w) redeemed the loan true to the time promised.

Integrity holds considerable inner power at its source. It connects with the capability of a leader to guide, direct and influence people based on moral principles and ethical values. Such a quality, supplemented by righteousness, trustworthiness and foresight, get people and ideals together. Keeping promise and trust is a harbinger to creating a legacy of greatness.

In developing people, leaders and successors, prophet (s.a.w) focused in the tacit value of personal integrity.

ENHANCEMENT OF RELATIONSHIPS WITH PEOPLE

The prophet s.a.w was reported to sanctify his time of day into three dimensions: one dimension for Allah SWT, one dimension foe his family and one dimension for himself and his ummah. The time he allocated for his people was best given to the commoner more than to the elite. He was inclined to show preference for the people of merit and would devote greater attention to those who excelled in the Din. He was constantly concerned about the welfare of his people. In the search for fulfillment, Muhammad s.a.w was looking for feedback. He was as having often said:

“Those who are present should convey things to those who are absent and you should let me know about what is needed by people who cannot convey their needs to me. On the Day of Rising, Allah will make firm the feet of a person who convey to a ruler the need of someone who cannot convey it himself”

With feedback, Muhammad s.a.w received first hand information about his performance, and keep close contacts with all his Companions.

Empowerment ensures that people down the line are given the initiative and freedom to realize their full potential, by planning and acting for the good of all. When people empowered creativity and innovation occur to make way for breakthroughs in management.

The prophet s.a.w was constantly alert and proactive, realizing that even the slightest negligence or complacency on his part would be limited b his follower. At the meeting or gathering he did not reserve a special seating for himself and asked that he be no accorded so. When he was with his usrah or halaqah he sat down at the edge that set with him an equitable share so that nobody was construed as more or less honorable than the other. His meetings were of decorum. There were no raised voices, or bad mouthing nor obscenities uttered. He was not the one to find fault with others, nor was anyone over praised. Whatever was superfluous or blatant was ignored. Such was the personality and character of Muhammad s.a.w.

LEADERSHIP EFFICACY

Efficacy means producing the desired results. It conveys the power pr capacity to produce a desired effect. The prophet s.a.w was able to rise above great odds to forge internal unity among his ummah. He transformed his meagerly equipped forces into a truly synergistic army fired by a sense of mission and a constancy of purpose. He work with the right frame of reference and set the systems for the administataion of government, justice and civil administration. In the process of help he helped to remove fear, psychological barriers and inferiority complex. By empowerment his people he had transformed them into a force to be reckoned eith, a force with an abundance rather that a scarcity mentality, drawing all its strength and inspiration from Allah SWT. The prophet s.a.w’s preeminence in leadership qualities enabled Islam to spread its influence far and wide after his passing. In propagating the universality of Islam, he ensured justice and equity to all peoples under Islamic temporal jurisdiction by being egalitarian in his system of governance regardless of ethic origin, creed or belief. This legacy made Islam credible and respected by all.

In leaving behind a legacy, Muhammad s.a.w had on many occasions literally put his life on the line. On both Makkah and Madinah his thrust was clear, “We are accountable, individual to Allah SWT and collectively to each other, for the well being of this community.” Thus when the prophet of Islam postured “Together we can make a difference” to be his credo, the believers and others took him seriously for his deep belief in what he saying.

ETHICAL CONDUCT

Ethic is a set of moral principles concerned with what is right and what is wrong. It reflects the character of individual, the group and nation state. The basis of Islamic ethic propagated by the prophet s.a.w is tawhid. The tawhidic paradigm of oneness of Allah SWT and complete subservience to Him prevents man from creating mischief on the face of this earth because his orientation is fear of God Almighty.

The Quran exhorts man to enjoin good and forbid evil without attempting to create disorder:

“Andlet there be among you a body of men who should invite to goodness, and enjoin equity and forbid evil. And it is they who shall prosper”

(Al-i-Imran, 3:104)

“And create not disorder in the earth after it has been set in order, and call upon Him in fear and hope. Surely the Mercy of Allah is nigh (near) unto those who do good”

(Al-ARaf, 7:56)

Islamic ethic transcends the material world into the moral and spiritual realm of earning the pleasure of Allah SWT. It is the understanding of right and wrong for the purpose of practice, not just for sake of mere knowledge.

Western ethics utilizes the rational approach and is guided only by reason. Islamic ethics is guided by both religion and reason regulated by Shariah Law. Ethic is synonymous with akhlaq in islam, and is strengthened in character by four elements:

In Islam, corruption and bribery earn the displeasure of Allah SWT. So does carefree living and extravagance:

“And do not devour your wealth among yourselves through falsehood, and offer it not as bribe to the authorities that you may knowledge devour a part of the wealth of other people with injustice.” (Al-Baqarah, 2:188)

The prophet s.a.w had time and again forewarned that Allah SWT witnesses everything we do and holds us accountable for any deviationist action. What is the truly desired is adequate preparation via moral uplift, through the acquirement of spiritual or revealed knowledge.

“O you who believe! If you obey and fear Allah, He will grant you Furqan a distinction (to judge between right and wrong), remove from you (all) evil (that may afflict) you, and forgive you; for Allah is the lord of grace unbounded”

(Al-Anfal, 8:29)

Islam exhorts its beliefs to the practice of ihasn or beneficence. Ihasn is the orientation to continuously and progressively strive to increase one’s level of wholesomeness to attain iman and taqwa.

The art of management involves the motivation of people to achieve desired results. It required competency and skills in the functions of planning, organization, staffing, directing, and controlling. Future, the manger needs to engage in continuous communication and problem solving because no situation is really ideal or stoic at any moment in time.

At last ethical conduct is best summarized here as benchmarking on “amr makruf and nahi munkar, he enjoining in of good and forbidding of evil.

MORAL UPLIFT THROUGH SPIRITUAL KNOWLEDGE

The revealed spiritual knowledge is drawn from the Kitab-Allah and translated into piratical guidance by the Sunnah of the prophet s.a.w. The Hadith have long been the guiding light for appropriate behavior within the community of nation and people of the universe. In management setting, leaders and followers need moral guideline to effect change and progress.

True leader have one abiding quality the moral will to persevere. Moral power rests upon five principle s of qualitative virtues:

Purpose-leaders with strong moral fibre have a definite purpose overpowering their foresight; this is called a sense of mission. Their mission is usually based on a universal spiritual guidance and knowledge. For Muslims they are Quran and Sunnah.

Pride-effective managerial leaders cultivate a high level of self esteem, a healthy and positive belief in heir own abilities

Patience-approaching the millennium of digital technology, speed management is fine for quantitative operation, but when dealing with human being the leader has to pace.

Perseverance- this is the quality of steadfastness, to not give up especially when faced with intense opposition. Spiritual guider leaders do not weaken their resolve “staying the course”.

Perspective-leaders and managers must know what is really important and act according to priority. Perspectives are the philosophies which state that reality can only be understand from different angles or points of view.

CONCLUSION:

Thus fro the above discuss about the leadership and entrepreneurship we can learn the basic framework of Islamic shariah in management leadership and entrepreneurship. We should follow what prophet did and thought to us in principle and at the same time we can make ijitihad base on the real situation within the Islamic aspects.