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Entrepreneurship Govind PDF
Entrepreneurship Govind PDF
MODULE- I
The Concept of Entrepreneurship
v Definition of Entrepreneurship
v Need for Entrepreneurship
v Factors Influencing Entrepreneurship
Characteristics of Entrepreneurship
v Qualities of Entrepreneurship
v Entrepreneurial functions
v Classification of Entrepreneurs
Difference between
v
v
v
v
v
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INTRODUCTION
The ultimate measure of a man
Is not where he stands
In moments of comfort and convenience
But where he stands
At times of challenge and controversy.
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WHO IS AN ENTREPRENEUR?
An entrepreneur is a person with a dream, originality and daring, who acts as
the boss, who decides as to how the commercial organization shall run, who
co-ordinates all activities or other factors of production, who anticipates the
future trend of demand and prices of products.
An entrepreneur is one of the important segments of economic growth.
Basically he is a person responsible for setting up a business or an enterprise.
Infact, he is one who has the initiative, skill for innovation and who looks for
high achievements. He is a catalytic agent of change and works for the good
of people. He puts up new green-field projects that create wealth, open up
many employment opportunities and leads to the growth of other sectors.
The entrepreneur displays courage to take risk of putting his money into an
idea, courage to face the competition and courage to take a leap into unknown
future and create new enterprises/ business. This creative process is the life
blood of the strong enterprise that leads to the growth and contributes to the
national development.
The entrepreneur will always work towards the creation and enhancement of
entrepreneurial society.
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BASICS OF AN ENTREPRENEUR
Organization
Urge
Innovation
Skill
Risk
Vision
Enterprise
Growth
Management
We can define entrepreneur as one who innovates, raises money, assembles
inputs, choose managers and sets the organization going with his ability to
identify them.
As per Peter Drucker- An entrepreneur is one who always searches for
change, responds to it as an opportunity. Entrepreneurs innovate. Innovation
is a specific instrument of entrepreneurship.
As per Joseph A. Schumpeter- Entrepreneur is one who innovates, raises
money, and assembles inputs, chooses managers and sets the commercial
organization going with his ability to identify them and opportunities which
others are not able to identify and is able to fulfill such economic
opportunities.
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Entrepreneur
Entrepreneurship
Person
Process of action
Enterprise
Object
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Entrepreneurship
Innovation
Risk- bearing
INNOVATION
Innovation, i.e. doing something new or something different is a necessary
condition to be called a person as an entrepreneur. The entrepreneurs are
constantly on the look out to do something different and unique to meet the
requirements of the customers. They may or may not be inventors of new
products or new methods f production but they possess the ability to foresee
the possibility of making use of the inventions for their enterprises. In order to
satisfy the changing preference of customers nowadays many enterprises
have adopted the technique of innovation. For instance, pidilite industries
innovated the new 5.rs pack of fevi quick which was accepted by the
customers as it was easy to use when it was needed. Other example would be
of the mobile enterprise which came up with the scheme for the customers of
refill pack of 999.rs which says Zindagi bhar mobile raho which was
accepted bye the customers. Since customers taste and preferences always
keep on changing, hence the entrepreneur needs to apply invention on a
continuous basis to meet the customers changing demand for products.
RISK- BEARING
Entrepreneurship is the propensity of mind to take calculated risks with
confidence to achieve a predetermined business or Industrial objective. The
capacity to take risk independently and individually with a view to making
profits and seizing the opportunity to make more earnings in the market-
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EMPLOYMENT GENERATION:
Great dynamism is one of the qualities of the small and medium enterprises.
This quality of dynamism originates in the inherent nature of the small
business. The structure of small and medium enterprises is less complex than
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Small business promotion needs relatively low investment and therefore can
be easily undertaken in rural and semi-urban areas. This in turn creates
additional employment in these areas and prevents migration of people from
rural to urban areas. Since majority of the people are living in the rural areas,
therefore, more of our development efforts should be directed towards this
sector. Small enterprises use local resources and are best suited to rural and
underdeveloped sector. This in turn will also lead to dispersal of industries,
reduction in concentration of economic power and balanced regional
development.
v
INNOVATIONS IN ENTERPRISES:
FAMILY TRADITION:
Individuals who for some reason, initiate, establish maintain and expand new
enterprises generate entrepreneurship in society. It is observed that
entrepreneurs grow in the tradition of their families and society and accept
certain values and norms from these sources.
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Religious, social and cultural factors also influence the individual taking up
an entrepreneurial career, in some countries there is religious and cultural
belief that high profit is unethical. This type of belief inhibits growth of
entrepreneurship.
v
PSYCHOLOGICAL FACTORS:
POLITICAL FACTORS:
The political and also the political stability of country influence the growth of
entrepreneurship. The political system, which promotes free market,
individual freedom and private enterprise, will promote entrepreneurship.
v
ECONOMIC POLICIES:
The economic policies of the government and other financial institutions and
the opportunities available in a society as a result of such policies play a
crucial role in exerting direct influence on entrepreneurship.
In view of the haphazard development of economic zones, Government is
encouraging the entrepreneurs to establish their business in backward and
tribal areas. This is primarily to arrest the migration of people from the
villages to cities and to create employment opportunities locally. Government
is promoting such development by giving incentives like tax holidays (both
sales and income), subsidized power tariff, raw materials, transportation cost
etc.
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QUALITIES OF ENTREPRENEURSHIP
The qualities that contribute to the success of an entrepreneur are as follows: 1. Risk Taking: - Entrepreneurs are moderate risk takers. They enjoy he
excitement of a challenge, but they do not gamble. Entrepreneurs avoid
low- risk situations because there is a lack of challenge. They avoid
high risk situations because they want to succeed. They like achievable
challenges. They do not tend to like situations where the outcome of a
quest depends upon a chance and not on their efforts. They like to
influence the outcome of their quest by putting in more efforts and
then experiencing a sense of accomplishment. A risk situation occurs
when an entrepreneur is required to make a choice between two or
more alternatives whose potential outcomes are not known and must
be evaluated in advance, with limited information. A risk situation
involves potential gain and potential loss. As the size of the business
expands the problems and opportunities become more numerous and
complex. Business growth and development require an entrepreneur
not to be afraid of taking decisions and certain risks. Most people are
afraid to take risks because they want to be safe and avoid failure. An
entrepreneur always takes a calculated risk and is not afraid of failure.
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ENTREPRENEURIAL FUNCTIONS
An entrepreneur is said to perform the following functions:
1. Assumption of risk: - Risk bearing or uncertainty bearing is the most
important function of an entrepreneur which he tries to reduce by his
initiative, skill and good judgment.
2. Business decisions: - The entrepreneur has to decide
a. To enter the industry this offers him the best prospects
b. To produce goods that he thinks will pay him the most
c. To employ those methods of production which seem to him the
most profitable.
d. To effect suitable changes in the size of the business, its location
that are needed for the development of his business.
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Deciding the
Project.
Raising
Finance
Risk Taking
Planning
Production
Managing
Enterprise
Innovation
Earning Profits
Entrepreneur
Fig.2 Entrepreneurial function
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CLASSIFICATION OF ENTREPRENEURS
The entrepreneurs have been broadly classified according to
v
v
v
v
v
Types of business
Use of professional skill
Motivation
Growth
Stages of development
ENTREPRENEURS IN TECHNOLOGY
v
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Non- technical entrepreneur are those who are not concerned with the
technical aspects of the product in which they deal. They are concerned
only with developing alternative marketing and distribution strategies
to promote their business.
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DIFFERENCE BETWEEN
A. ENTREPRENEUR & MANAGER
No.
ENTERPRENEUR
MANAGER
1.
2.
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4.
The reward an entrepreneur gets A manger gets salary for the services
for baring risks involved in the rendered by him in the enterprise.
enterprise is profit which is
highly uncertain.
5.
6.
An entrepreneur needs to
possess
qualities
and
qualification
like
high
achievement motive, originality
in thinking, foresight, riskbearing, ability and soon.
NO
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
ENTREPRENEUR
ENTREPRENEURSHIP
Refers to a person
Is a visualiser
Is a creator
Is an organizer
Is an innovator
Is a technician
Is an initiator
Is a decision- maker
Is a planner
Is a leader
Refers to a process
Is a vision
Is a creation
Is an organization
Is an innovation
Is a technology
Is an initiative
Involves decision making
Involves planning
Involves leadership
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ENTREPRENEUR
LABOUR
ENTERPRISE
CAPITAL
LAND
The entrepreneur and enterprise are Inter- linked. Enterprise is an offshoot of
an entrepreneur. Its success is dependent on the entrepreneur.
No.
ENTREPRENEUR
ADMINSTRATOR
1.
2.
3.
An administrator of a large
organization would hold attitudes
related to the administrative
orientation of the management
process.
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No.
ENTREPRENEUR
INTRAPRENEURSHIP
1.
2.
3.
4.
END OF MODULE I
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MODULE II
THEORIES OF ENTREPRENEURSHIP
Knight on the Role of Uncertainty
Schumpeter on Innovation
Mc Clellands Achievement and Motivation theory
Peter Druckers views on Entrepreneurship
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SCHUMPETER ON INNOVATION
Schumpeter, perhaps more than any other writer, is very explicit about the
economic function of the entrepreneur. The entrepreneur is the prime mover
in economic development and his function is to innovate or to carry out new
combinations. Five types of innovation are distinguished the introduction of
new good (or an improvement in the quality of an existing good); the
introduction of anew method of production; the opening of an new market, in
particular, a export a market in a new territory the conquest of a new source
of supply of raw materials or half- manufactured goods and the creation of
a new type of industrial organization, in particular, the formation of a trust or
some other type of monopoly.
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Some societies produce a large percentage of people with high need for
achievement. Entrepreneurship becomes the link between need achievement
and economic growth.
Mc Clelland considers the need for achievement to be most critical to a
nations economic development. He held that a strong inner spirit in
individuals to attain is a measurable variable arising from a need, which the
individual develops mainly in childhood and seeks to satisfy throughout his
life. This inner spirit which he called need for achievement, if higher, would
produce more energetic entrepreneurs capable of generating rapid economic
development. High need for achievement or ambition motivates an
entrepreneur to take risks, work hard, find new things, save more, and
reinvest the savings in industry and so on. The limited empirical evidence
supports the hypothesis that need for achievement contributes to
entrepreneurial success.
Mc Clelland rated the achievement motivation of different countries on the
basis of ideas related to need for achievement contained in the childrens
stories. This has come to be known as n-factor rating. He established a
correlation between n- factor rating and the prosperity of the countries a
generation ahead.
The criterion on n- factor rating was the inherent concern for achievement or
non- induced achievement motivation.
Mc Clelland found that achievement motivation was lower among people
under developed countries than among these of developed nations. Even in
USA only about ten percent of the people were actually high achievers. It is
the level of aspirations or ambitions that explains the lack of enterprise
underdeveloped countries. Ambition is the level of all motives and aimless
life a goal- less game. Ambitions motivate men, activate them, broaden their
vision and make life meaningful. Ambition builds up achievement pressure in
the individual and provides the base for Mc Clellands n- factor. Ambition is
the lever of all motives. The initiative intentions of an individual are directed
by his ambitions. It is the ambition electrifies mans actions. Therefore, what
matters are not merely the people are their aspirations and the means to
achieve the goals? Therefore, it is the duty leaders and teachers to build up
ambitions into the minds of the young people however ambitions differ greed
and windfall. Greed results in disaster a windfall makes one speculator
.Sometimes personal ambitions may come in way of family aspirations or
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END OF MODULE II
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MODULE III
BUSINESS PLAN
PROJECT
MANAGEMENT
Introduction
Selection of a Product.
Adoption Process.
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of
Product(s)
Service(s)
Size of business.
Office equipment and personnel.
Background of entrepreneurs.
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Pricing.
Distribution.
Promotion.
Product forecasts.
Controls.
Form of ownership.
Identification of partners or principal shareholders.
Authority of principals.
Management- team background.
Roles and responsibilities of members of organization.
Letters.
Market Research Data.
Leases or contracts.
Price lists from suppliers.
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EXECUTIVE SUMMARY:
This is prepared after total plan is written. This about 3 to 4pages in length,
this summary should stimulate the interest of the potential investor. This
highlight concise and convincing manner the key point in the business plan
stating the nature of the venture, financing needed, market potential, and
supports to why it will succeed.
INDUSTRIAL ANALYSIS:
This reviews industry trends and competitive strategies. The industry
outlook, including future trends and historical achievements, insight of new
product developments in this industry. Competitor should be identified, with
appropriate strengths and weakness described and how will it affect the new
ventures potential success in the market.
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Setting goals requires the entrepreneur to be well informed about the type of
business and the competitive environment. Goals should be specific and not
so mundane as to lack any basis of control. For example, the entrepreneur
may target a specific market share, units sold, or revenue. These goals are
measurable and be monitored overtime.
In addition, the entrepreneur and his or her family must make a total
commitment to the business in order to be able to meet the demands of a new
venture. For example, it is difficult to operate a new venture on a part- time
basis while still holding on to a full- time position. And it is difficult to
operate a business without an understanding from family members as to the
time and resources that will be needed. Lenders or investors will not be
favorably inclined toward a venture that does not have full- time
commitment. Moreover, lenders or investors will expect the entrepreneur to
make a significant financial commitment to the business even if it means a
second mortgage or a depletion of savings.
Generally, a lack of experience will result in failure unless the entrepreneur
can either attain the necessary knowledge or team up with someone who
already has it. For example, an entrepreneur trying to start a new restaurant
without any experience or knowledge of the restaurant business would be
disastrous.
The entrepreneur should also document customer needs before preparing the
plan. Customer needs can be identified from direct experience, letters from
customers, or from marketing research. A clear understanding of these needs
and how the entrepreneurs business will effectively meet them is vital to the
success of the new venture.
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PROJECT MANAGEMENT
WHAT IS A PROJECT MANAGEMENT ?
It is a specialized branch of management that includes variety of factors such
as organization structure, the process of planning and control, human
relations etc. It is executed as under:
a) Decide the scheme of operations.
b) Break down work into series of operations.
c) Evolve an orderly sequence or programme.
Every project has three basic attributes, namely
v
v
v
The input characteristics define what the project requires such as raw
materials, energy, manpower, financial resources and organizational
structure.
The output characteristics define what the project will generate viz.
production of additional goods, provision of additional services etc. The
social cost benefit aspect affects the equilibrium of availabilities and nonavailabilities in an economy. Thus the benefits which will be accrued to the
society have to be carefully evaluated.
The project idea needs to be evaluated for its feasibility and the setting up of
an enterprise should be based on careful and sound evaluation. Project
appraisal brings credibility to a project and projects from in built weaknesses
and consequently a healthy and viable industry comes up.
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Family
Customers
Friends
Colleagues
Salesman
Social Contacts
Employees
Magazines
Journals
Books
Newsletter
Newspapers
Catalogues
Trade Shows
Seminars/ Workshops
Professional Organizations
Small Business Organizations
Suppliers/ Dealers
One should use as many resources as possible for the purpose of scanning the
environment.
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OBSERVATIONS
Entrepreneurs get tempted to step into the field that profit potential
and is socially acceptable.
SELECTION OF A PRODUCT
Very essential for being success in business venture. The various factors that
influence the entrepreneur in selecting the right product are:
v
Market for the product if the product also has an export market, it
widens the scope of marketing and hence the success of the enterprise.
Certain products are permitted for production only if the others belong
to de- licensed category. Hence a product belonging to licensed
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Awareness
Interest
Evaluation or mental trial
Trial- physical
Awareness:
A consumer learns about anew idea or a product and obtains limited
information about its qualities, usefulness, performance through
advertisements etc.
Interest:
Once the consumer develops an interest in the innovation, he demands
detailed information about the new products, its utility, its performance, etc.
He gets more information through jingles on radio or TV ads and teaches
through sales- persons, opinion leaders, peers, friends etc.
Evaluation:
The consumer tries to weigh the value of the new product in relation to the
benefits obtained from it i.e. conducts a mental trial of the new product.
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PRODUCT INNOVATION
Internal
Development
Licensing
Acquisition
INTERNAL DEVELOPMENT
Discovering and developing new products by the firm itself a desirable
means.
LICENSING
Securing right to produce the product from a patent holder i.e. contractual
arrangement e.g. coca cola.
ACQUISITION
Buying the firm that developed or patented the product- a costly means.
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Land development
Irrigation
Soil- conservation
Fertilizers, and
Seeds etc.
2. Research projects
Definition of Project- According to World Bank, project can be defined as
An approval for a capital investment to develop facilities to provide goods
and services.
Little and Mireless defines project as A scheme or a part of scheme for
investing resources which can be reasonably analyzed and evaluated as an
independent unit. It is an appraisal for investment with the definite aim of
producing a flow of output over a specific period of time.
Gittinger has defined it as the whole gamut of activities involved in using
resources to gain benefits.
According to Dr. Albert O. Hirchman The development project connotes
purposefulness, some minimum size, a specific location, the introduction of
something qualitative new, and the expectation that a sequence of further
development will be set in motion.
Project can be defined as a scientifically evolved work plan devised to achieve
a specific objective with a specified period of time. The three basic attributes
of a project are
1. A course of action
2. Specific objectives, and
3. Definite time perspective.
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2. Sectoral Projects
In India planning commission has accepted the Sectoral basis as the criterion
for classification
v
v
v
v
v
v
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Capital intensive
Labour- intensive
New projects
Expansion projects
Modernization projects
Diversification projects
Welfare projects
Service projects
Research and development projects
Educational projects
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Size
A Scheme
Social
Benefits
Organization
Selection
Identification
Formulation
Implementation
Appraisal
Management
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MODULE- IV
WOMEN ENTREPRENEURSHIP
Concept of Women entrepreneurship
Growth of women entrepreneurship
Problems of women entrepreneurship
Special schemes for women entrepreneurship
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END OF MODULE IV
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MODULE- V
ANCILLARIZATION
What is an ancillary unit?
Development of ancillary industry in India
Factors affecting ancillarization
Role played by Financial Institutions and commercial
banks
Meaning of sub- contracting
Advantages and disadvantages of sub- contracting
Franchising
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It was more convenient for large scale manufactures to get the ancillary
units to produce certain items for them. With the growing complexity
of management, the large scale manufacturer can now concentrate on
the problems of organization, marketing etc, rather than concentrating
on availability of raw materials etc.
All these facts underscore the point that the development of ancillaries and
their growing popularity have been well supported by economic and
management considerations.
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FRANCHISING
In a sense, franchising is very much similar to branching. Franchising is a
system for selectively distributing goods or services through outlets owned by
the retailer or dealer. Basically, a franchise is a patent or trademark license,
entitling the holder to market particular products or services under a brand
name or trademark according the different terms and conditions.
According to David D. Settz A franchisee is a form of business ownership
created by contract whereby a company grants a buyer the rights to engage in
selling or distributing its product or services under a prescribed business
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DISADVANTAGES
Franchising is not an unmixed blessing. There are some disadvantages as well
associated with a franchise arrangement. The main ones are listed as follows:
1) Unlike entrepreneurs who start their own business, the franchisees find
no room or scope for enjoying their creativity. They have to work as
per the given format. One classic example of regimentation in
franchising can be found in the Mc Donalds restaurant organization. A
Mc Donalds franchise is given very little operational latitude, indeed
the operations manual attends to such minor details as when to boil the
bearings on the potato slicer. The purpose of these restrictions is not to
frustrate the franchises, but to ensure that each outlet is run in a
uniform correct manner.
2) A number of restrictions are also imposed upon the franchisees.
Restrictions may relate to remain confined to product line or a
particular geographical location only.
3) Franchisees usually do not have the right to sell their business to the
highest bidder or to leave it to a member of their family without
approval from the franchiser.
4) Though the franchisee can build up goodwill for his or her business by
his or her efforts goodwill still remains the property of the franchiser.
5) The franchisee may become subject to fail with the failure of the
franchiser, another disadvantage facing franchisees is that franchisers
generally reserve the option to buy back an outlet upon termination of
the contract. Many franchisees become vulnerable to this option. As
such, they operate under the constant fear of non- renewal of the
franchise agreements.
Then do these disadvantages mean that franchising is no longer desirable way
to go small business? Certainly not franchising is a proven and complete
business concept. In fact, what do they really mean is that the security that
some people associate with franchising is an illusion? Hard work, realistic
expectations, and very careful investigation are required if becoming a
franchisee is to be a successful, satisfying experience. This underlines the need
for evaluation of a franchising agreement.
END OF MODULE V
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MODULE-VI
ENVIRONMENTAL SCANNING
AND SECTORAL STUDIES
Swot Analysis
Entrepreneurial Environment
Environmental Analysis
Scope for Entrepreneurship in small business sector
Entrepreneurship process of liberalization
Changing Role of Entrepreneurship in the era of
liberalization, privatization and globalization
Entrepreneurship as a Catalyst for meeting global
changes
Creativity & Innovation
Key sectors for the new age Entrepreneurs
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SWOT ANALYSIS
The business environment keeps changing. Government policies and
regulations, economic conditions, social conditions, technological factors,
competitive situation etc. Undergo changes. The environmental changes may
open up new opportunities or pose new threats.
Constant monitoring of the environment is therefore, necessary to identify the
emerging opportunities and threats. In order to understand to what extent a
firm will be able to exploit the opportunities and fight the threats, it is
necessary to evaluate the strengths and weaknesses of the firm. Thus, an
analysis of the strengths and weaknesses of the firm and the opportunities
and threats in the environment that is the SWOT analysis is essential for
framing the business strategies.
S- Strengths.
W- Weaknesses.
O- Opportunities.
T- Threats.
v STRENGTHS AND WEAKNESSES:
Strengths and weakness analysis is a real test for management. The strength
and weaknesses would decide whether a company should continue in a
business, take up new lines of business, as well as the strategy to be employed
in doing so.
For e.g. in case of some products, small scale units have definite advantage
over large- scale units in costs. If a large scale unit were not able to compete
with the small- scale units, in such a case, it would be wise on the part of the
large unit to give up the business of such products.
The strengths and weakness analysis is done by functional audit of different
areas like marketing, finance, design/ engineering, operations etc. The audit
is to be done on the basis of the quantity and quality of skills and the
infrastructures support 3 available facilities in terms of physical facilities,
resource available, speed and flexibility in arranging them.
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ENTREPRENEURIAL ENVIRONMENT
Entrepreneurship environment refers to the various facets within which
enterprises- big, medium and small and others have to operate. The
environment therefore, influences the enterprise. By and large, an
environment created by political, social, economic, national, legal forces etc
influences entrepreneurship.
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SOCIOCULTURAL
ENVIRONMENT
PRODUCT
P
R
I
C
E
COMPANY
PLACE
P
R
O
M
O
T
I
O
N
ECONOMIC
ENVIRONMENT
POLITICAL
ENVIRONMENT
TECHNOLOGICAL
ENVIRONMENT
A) PRODUCT:
The business has to produce a product that people want to buy. They
have to decide which market segment they are aiming at age, income,
geographical location etc. They then have to differentiate their product so that
it is slightly different from what is on offer at present so that people can be
persuaded to give them a try.
In other words product is a bundle of satisfaction that a costumer buys. It
represent solution to a customers problem .It is in this context that
marketing definition of a product is more than just what the manufacturer
understand it.
B) PRICE:
To a manufacturer, price represent quantity of money received by the firm or
seller .To customer, it represent sacrifice and hence his perception of the value
of product.
The price must be high enough to cover costs and make a profit but low
enough to attract customers. There are a number of possible pricing strategies.
The most commonly used are:
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C) PLACE:
The business must have a location that it can afford, and that is convenient
and suitable for customers and any supplier.
D) PROMOTION:
Promotion means moving from one end to another. Promotion means all
those tools that a marketer uses to take his product from the factory to the
customer and hence involves advertising, sales promotion, personal selling,
public relations publicity and merchandising.
Customers have to be made aware of the product. The two main
considerations are target market and cost. A new business will not be able to
afford to advertise on national television, for instance and would not wish to
because its market will be local to start with. Leaflets, billboards,
advertisements in local newspapers, Yellow Pages and word of mouth
would be more appropriate.
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ENVIRONMENTAL ANALYSIS
This integrated approach which is the key to the development of backward
areas implies a very careful environment analysis or research study of the
target groups of beneficiaries, their activities and differential needs and the
practical modes of operation by which their activities can be linked with the
covering enterprise. Unless these studies are made meticulously, the entire
planning will only give unproductive results. Most of the development
schemes fail to benefit the target clientele because elaborate linkages are not
identified and built up. An imaginative study should
1. Identify the beneficiaries or target groups.
2. Analyze the environment for immediate feasible enterprises in an
integrated manner.
3. Delineate the linkages and institutional arrangements.
4. Recommend appropriate organizational structures to provide
necessary promotional support.
Unfortunately, in most of the studies on backward areas, there is a tendency
to make generalizations and ignore the specific details of feasible projects. As
a result, immediate perception of concrete opportunities by interested
entrepreneurs is left in confusion. Sometime! Area studies make a general
statement of demand and resources and recommend certain enterprises,
which are not immediately feasible due to important reasons unaccounted for
in such studies. It is also not seriously contemplated whether the
recommended enterprises are feasible within the capabilities and investment
capacity of the target- group.
In short, most of the studies fail to disconcern the real issues of growth in the
target area and fail to identify the concrete and specific needs of these
endowments like resource skill etc. to flourish. Enunciation of general
objectives, generic beneficiaries tend to blur the distinct contours of one
homogeneous group from the other. Also, the extension of certain standard
facilities or services does not serve their actual needs. All this possibly
happens because in such basic studies we fail to identify clearly the targetgroups and their specific problems, and make theoretical studies on resources
and demand in an impersonal manner, as a result of which even the schemes
devised on the basis of such studies tend to become too impersonal and rigid.
Sometimes, the scheme become so flexible on account of a standardized
petrified approach that in some most genuine cases demanding a certain
departure from the fixed framework, the scheme is incapable of giving
requisite help. It is therefore, absolutely necessary that any action plan for a
backward area must first identify the target- group, identify the specific
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INDUSTRIAL SECTOR
Small scale industries occupy an important place in the industrial sector. They
have contributed over 40% in the gross industrial production in 1998.
Small- scale industries: The basic objectives underlying the development of
small- scale are the increase in the supply of manufactured goods, promotion
of capital information the development of indigenous entrepreneurial talents
and skills and the creation of broader employment opportunities. This sector
provides a wider scope for the potential entrepreneur to develop his or her
own industry. There is a good scope and enormous potential to use
technology based products in the small- scale sector. An entrepreneur can
exploit a profitable venture in any of the industries reserved for exclusive
department under the small- scale sector. There are as many at 384 items for
exclusive purchase from the small- scale industries.
Small- scale industries play an important role in increasing the national
income, in meeting the shortage of consumers goods, in promoting balanced
regional development, in reducing inequalities in the distribution of income
and wealth and in relieving the economic pressure on land and over
crowding in urban areas. Outdated technology, shortage of finance, shortage
of raw material and inadequate marketing facilities are some of the problems
faced by small entrepreneurs.
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SERVICE SECTOR
The service sector has gained importance for the entrepreneurs because of its
rapid expansion. Service sector includes all kinds of business and provides
opportunities to the entrepreneurs in business such as hotels, tourist services,
personal services such as dry cleaning, beauty shops, photographic studies,
auto repair, electric repair shops, wielding repair etc.
Transport: They provide time and place utilities in urban and rural areas to
both men and material. The different modes or transport are of immense
importance in the areas, which are not served by roads and railways. There is
a scope for entrepreneur to design prototypes of new carts with the
application of indigenous technology so that they may have better mobility
and greater carrying capacity. The primary need in the rural area is an
efficient system of road transport.
The rural economy has a good opportunity for an entrepreneur to develop
some business. They can exploit possibilities for a venture in some shops or
services. Entrepreneurship flourishes in small business sector for they have
enormous opportunities in manufacturing and non- manufacturing activities.
The government is keen in encouraging the competitive strength of the small
scale producers and it has taken a number of measures such as:
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These are golden opportunities for the prospective entrepreneurs to selfemployed independent businessman. The future is very bright.
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Bring about an attitudinal change in the minds of the people and the
society in general. A conservative and religious society or a society that
is bound by customs and traditions cannot take full advantage of
entrepreneurial opportunities. An entrepreneur may have to strive to
convert the society into a dynamic, rational and a progressive one. He
may have to influence the government into bringing about economic
reforms of various types for exploiting global opportunities.
Exploit change and use it not only for his and for the benefit of his
organization but also for the benefit of his economy.
CREATIVITY
Creativity implies conceptualizing, visualizing or bringing into being
something that does not yet exist. It is about curiosity and observation. In the
history of science, there are interesting examples of creativity occurring at the
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INNOVATION
Innovation builds creativity when something new, tangible and value
creating is developed from the ideas, innovation can be focused on the theme
of being better-incremental improvements-as well as the theme of being
radically different. The former will often form the world of the entrepreneur,
who us attempting to make his or her organization d stronger than his rivals
.The later is often ,but certainly not always, reserved for the true
entrepreneur, who is more concerned with doing something genuinely new
and different rather than improving on ideas that have gone before.
Innovation is about seeing the creative new idea through to completion, to
final application but, of course, this will not necessarily be a business. It is the
entrepreneur who builds a business around the idea and innovation. Both can
e difficult roads and require courage and perseverance as well as creativity
and imagination. These are attributes that the entrepreneur brings and his or
her role in innovation is crucial.
There are the basic approaches with innovation, which are not mutually
exclusive, and we have seen illustrated in the stories in part two. First, it is
possible to have a problem and to be seeking solution, or at least a resolution.
Edwin Land invented Polaroid camera because his young daughter could not
understand why she had to wait for the pictures to be printed when he took
her photograph. Second, we might have an idea in effect a solution and be
searching for a problem to which it can be applied 3Ms. Post- it notes
happened when a 3m employee created a glue with only loose sticking
properties, and a college applied it to a need he had for making page in a
manuscript. Third, we might identify a need and design something that fits.
James Dysons dual cyclone cleaner came about because of his frustration
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Cyber Cafes
Bio Tech
Apparels
Rural Products like Handicrafts etc
Beauty Parlours
...THE END
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