Vinay Malshe

ENTREPRENEURSHIP
DEVELOPMENT
&
SMALL BUSINESS
MANAGEMENT

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 Vinay Malshe

Contents

1. The Concept of Entrepreneurship............................................................................... 3

2. Characteristics of Entrepreneurs ................................................................................ 4

3. Who is an Entrepreneur?............................................................................................. 8

4. Classification of Entrepreneurs................................................................................. 11

5. Importance of an Entrepreneur ................................................................................ 15

6. Entrepreneurial Behaviors, Attributes & Skills ...................................................... 16

7. Entrepreneur & Entrepreneurship........................................................................... 17

8. Entrepreneur, Manager & Intrapreneur ................................................................. 18

9. Case Study ................................................................................................................... 22

10. Barriers to Entrepreneurship .................................................................................. 26

11. Strategic Intent ……………………………………………………………………. 28

12. Business Plan………………………………………………………………………. 29

13. The 6 Habits of True Strategic Thinkers ……………………………………… .. 30

14. “7 Things Great Entrepreneurs Don't Do” ……………………………………... 34

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1. The Concept of Entrepreneurship

Entrepreneurship is a process undertaken by an entrepreneur to augment his business
interests. It is an exercise involving innovation and creativity that leads towards
establishing his/her enterprise.

One of the qualities of entrepreneurship is the ability to discover an investment

opportunity and to organise an enterprise, thereby contributing to real economic growth.
It involves taking of risks and making the necessary investments under conditions of
uncertainty and innovating, planning, and taking decisions so as to increase production
in agriculture, business, industry etc.

Entrepreneurship is a composite skill, the resultant of a mix of many qualities and traits -
these. include tangible factors as imagination, readiness to take risks, ability to bring
together and put to use other factors of production capital, labour, land, as also
intangible factors such as the ability to mobilise scientific and technological advances.

A practical approach is necessary to implement and manage a project by securing the

required licences, approvals and finance from governmental and financial agencies. The
personal incentive is to make profits from the successful management of the project. A
sense of cost consciousness is even more necessary for the long-term success of the
enterprise. However, both are different sides of the same coin.
Entrepreneurship lies more in the ability to minimize the use of resources and to put
them to_ maximum advantage. Without an awareness of quality and desire for
excellence, consumer acceptance cannot be achieved and sustained. Above all,
entrepreneurship today is the product of teamwork and the ability to create, build and
work as a team.

The entrepreneur is the maestro of the business orchestra, wielding his baton to which

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the band is played.

Entrepreneurship is the propensity of mind to calculate risks with confidence to achieve

a pre-determined business or industrial objective. In substance, it is the risk-taking ability
of the individual, broadly coupled with correct decision--making.

2. Characteristics of Entrepreneurs
The characteristics of an entrepreneur that contribute to success are the result of his
achievement motivation. The characteristics of achievement motivated persons as
identified by McClelland have been discussed in, the chapter on ―Future of
Entrepreneurship in India.‖ A successful entrepreneur must be a person with technical
competence, initiative, good judgement, intelligence, leadership qualities, selfconfidence,
energy, attitude, creativeness, fairness, honesty, tactfulness and emotional
stability.

1. Mental ability: Mental ability consists of intelligence and creative thinking. An

entrepreneur must be reasonably intelligent, and should have creative thinking and must
be able to engage in the analysis of various problems and situations in order to deal with
them. The entrepreneur should anticipate changes and must be able to study the various
situations under which decisions have to be made.

2. Clear objectives: An entrepreneur should-have a clear objective as to the exact

nature of the goods to be produced and subsidiary activities to be undertaken. A
successful entrepreneur may also have the objective to establish the product, to make
profit or to render social service.

3. Business secrecy: An entrepreneur must be able to guard business secrets.

Leakage of business secrets to trade competitors is a serious matter, which should be
carefully guarded against by an entrepreneur. An entrepreneur-should be able to make a
proper selection of his assistants.

4. Human Relations Ability: The most important, personality traits contributing to the success
of an entrepreneur is

5. Communication ability: Communication ability is the ability to communicate

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effectively. Good communication also means that both the sender and the receiver
understand each other and are being understood. An entrepreneur who can effectively
communicate with customers, employees, suppliers and creditors will be more likely to
succeed than the entrepreneur who does not.

6. Technical knowledge: An entrepreneur must have a reasonable level of technical

knowledge. Technical knowledge is the one ability that most people are able to acquire if
they try hard enough.
An entrepreneur who has a high level of administrative ability, mental ability, human
relations ability, communication ability, and technical knowledge stands a much better
chance of success than his counterpart who possesses low levels of these basic
qualities. Brilliant men with first class degrees from universities shy away from becoming
entrepreneurs because the one thing they cannot be taught is coping with human
emotions.
7. Motivator: An entrepreneur must build a team, keep it motivated and provide an
environment for individual growth and career development.

8. Self-confidence: Entrepreneurs must have belief in themselves and the ability to

achieve their goals.

9. Long-term involvement. An entrepreneur must be committed to the project with a

time horizon of five to seven years. No ninety-day wonders are allowed.

10. High-energy level- Success of an entrepreneur demands the ability to work long
hours for sustained - periods of time.

11. Persistent problem-solver: An entrepreneur must have an intense desire to

complete a task or solve a problem. Creativity is an essential ingredient.

12. Initiative: An entrepreneur must have initiative accepting personal responsibility for
actions, and above all make good use of resources.

13. Goal setter: An entrepreneur must be able to set challenging but realistic goals.

14. Moderate risk-taker: An entrepreneur must be a moderate risk-taker and learn from
any failures These personal traits go a long way in making an entrepreneur a successful
man/woman. But however, no entrepreneur possesses total strengths. In such cases, he
associates and/or acquires and thus strengthens his enterprise.

Characteristics of Small-Scale Entrepreneurs

1. They are young men.
2. They are energetic zealous/enthusiastic.
3. They have minimum basic education.
4. They are pleasant-mannered.

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5. They are hard-working

6. They are determined.
7. They are systematic.
8. They are self-made men.
9. They are self-confident.
10. They are disciplined men.
11. They follow a planned approach.
12. They are trained/experienced.
13. They have entrepreneurial zeal.
14. They have meagre capital.
15: Their area of operation is small.
16. Generally they deal in one product.

17. They employ a few people. .

18. Their turnover is small.
19. They are flexible

Characteristics of Large-Scale Entrepreneurs

1 Promoted and professionally managed through employed persons.
2. Large capital.
3. Capital contributed by large section of shareholders.
4. Shares are registered in the share markets/stock exchanges.
5. Large assets.
6. Assets acquired on classified credit.
7. Engaged in diversified activities.
8. Promotes and pushes goods in the market.
9. Huge turnover/sales/profits.
10. Easy access to institutional finance.
11. They have greater leverage for development.
12. They are well acquainted with political and officialdom.
13. They are the trendsetters
14. They can create demand for their products through consumer awareness programmes,
education etc.
15. They- are great visionaries, who foresee the need of the country well ahead of times.
16. They are responsible and have a value-driven, corporate philosophy.

Qualities of an Entrepreneur
A true entrepreneur besides possessing functional qualities, must also possess the
broad personality which help in developing initiative and drive to accomplish great tasks
and face challenges squarely.
James J. Berne has stressed the following qualities of a good entrepreneur:

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1. He is an enterprising individual. He is energetic, hard working, resourceful, aware of

new opportunities, able to adjust himself to changing conditions with ease and willing to
assume risks involved in change.

2. He is interested in advancing technologically and in improving the quality of his

product or service.

3. He is interested in expanding the scale of his operations by reinvesting his earnings.

4. He visualizes changes and adapts.

5. He is a firm believer in planning and systematic work.

6. He works for the society at large and for the good of his fellow-beings.
These qualities sum up, what is usually implied from the phrase, the ―spirit of enterprise.‖
It is difficult to conceivers of a first rate industrial entrepreneur who is not adaptable to
change, anxious to grow larger and improve technologically.

3. Who is an Entrepreneur?
An entrepreneur is a person who organizes and manages a business undertaking and
assumes a risk for the sake of profit.

The entrepreneur as a person brings in overall change through, innovation- for the
maximum social good. Human values remain sacred and inspire him to serve society.
He has firm belief in social betterment and he carries out this responsibility with
conviction. In this process, he accelerates personal, economic as well as humandevelopment.

The entrepreneur is a visionary and an integrated man with outstanding leadership

qualities. With a desire to excel, he gives top priority to Research and Development. . He
always works for the well being of the society. More importantly entrepreneurial activities
encompass all fields / sectors and fosters a spirit of enterprise for the welfare of
mankind.

Operating a business takes certain skills. Few people have all the skills needed to run a
business, but they can compensate for their weaknesses by hiring staff or consultants
and by becoming more knowledgeable through education or training.

How can I decide if I have the needed business skills?

You can assess your business skills by evaluating past jobs, volunteer work, positions in
organizations, and personal traits.
Consider your experiences and qualifications under each of the following headings.

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1. Organization and planning: setting and attaining goals, managing time commitments,
and keeping work schedules.

2. Handling money: determining budgets, securing loans, raising funds, keeping financial
records, and completing income tax forms.

3. Selling ideas and products: determining sales quotas and projections; presenting
projects for committees, organizations and/or administrative groups; direct selling to
customers or clientele; handling criticism and rejection.

4. Management: experience in managing all or part of a small business or an agency;

serving as director or major officer of an organization.

5. Working with people: mediating or arbitrating between people with opposing views
when the situation requires; organizing and planning large public events; assuming
officer or executive secretary positions in an organization, and/or handling complaints for
an organization or company; getting along well with most people.

6. Ability to take risks: taking moderate, calculated risks in varied situations (situations
where the chance of winning was not so small as to be a ―gamble‖ or so large as to be a
―sure thing‖ situations where there was a reasonable and challenging chance of
success).

7. Willingness to lead and to work alone: being self-disciplined; handling situations which
were ambiguous and full of uncertainty as to the job requirements; working calmly and
efficiently in the midst of an emergency or crisis.

8. Personality traits: taking the initiative in situations requiring it; accepting and
accomplishing more than your share of the work; willingness to work hard even if the
financial rewards are slow in coming; establishing high standards of performance and
raising them once they are met.

9. Knowledge of products and/or skills in the service offered by your business or in

producing your product: willingness to do self-study, research, and planning to improve
business operations.

Do I need all these skills?

Not all of these experiences are necessary for every business.
Few, if any, persons who start a business are experts at everything. You must be able to
assess your strengths and weaknesses before deciding whether you can take time to
learn what you need to know, or can afford to hire staff or consultants.
Expertise is more important in some businesses than in others.

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Only you can assess whether you have the right expertise to succeed.

How can I assess my skills?

Make a list of your work experiences, hobbies, interests, and acquired skills. You are
preparing your own ―resume‖ so be careful not to exaggerate or deceive yourself about
things on this list. Be honest and objective. After completing the list, it should be fairly
evident what you can bring to your new business and where your interests lie. Keep this
inventory available and use it when selecting the type of business you will launch.

What kind of business should I start?

What are the kinds of businesses you might consider starting?
Make a list of ones you could consider, eliminating only those that are obviously not for
you. Rule out ones that require talents and skills you did not list when you prepared your
―resume‖ and ones in which you have no interest.
You may have an original idea for a business that no one has considered or for a
product that doesn‘t exist. Try not to limit your thinking only to this new business or
product. To do this you must gather information. Evaluate your idea against other
possibilities.

What are some possible sources of information?

You might try one or more of the following sources for information:
• Telephone yellow pages can indicate what is and is not available in your area.
• Public libraries have a number of business directories, including the Thomas Register.
• Entrepreneurial magazines often have articles about new business ideas that have potential.
• Ask friends, coworkers, neighbors, and relatives if they have product or service needs
that are not currently being met.

What are some strategies for making a decision?

After considering business ideas on your list, narrow down the possibilities. To complete
the selection process, talk with people in the same or a similar business who are located
outside of the area where you are considering locating your business. Let them know
that you would value their advice. Usually they will be flattered and willing to share their
experience and advice.
Another strategy involves checking success and failure reports.

You can find this type of information at most public libraries.

Ask for professional advice. There are four professionals you should get to know early in
your business planning: an attorney, accountant, marketing consultant, and banker. Share your
plans with them. They may point out factors you hadn‘t yet considered.Share your thoughts with
your family, friends, and associates.

They may come up with considerations that may discourage you from one idea, or they may
offer real encouragement for pursuing another idea. Having the support and involvement of

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those close to you can be an added benefit. Make the final decision yourself. If you can answer,
―yes‖ to all four of the following questions, you are ready to make a commitment:
1. Does the business satisfy most of my wants and desires? (business selection criteria)
2. Do I have, or can I develop (or hire), the attributes and capabilities that are required for
success in this business?
3. Is the current condition and outlook for this type of business favorable?
4. Am I, and is my family, willing to accept the risks that will accompany my starting the
proposed business?

5. If the answer to question four is ―no,‖ you might want to consider your proposed business
ownership more carefully before proceeding. If you can answer, ―yes‖ to two of the first three,
you may need to rely on your instincts. Remember, there is probably no perfect business. You
will undoubtedly be making compromises no matter what you choose.

New Concept of Entrepreneur

The term ―entrepreneur‖ has been defined as one who detects and evaluates a new situation in
his environment and directs the making of such adjustments in the economic systems as he
deems necessary. He conceives of an industrial enterprise for the. purpose, displays
considerable initiative, grit and determination in bringing his project to fruition, and in this
process, performs one or more of the following:
i. Perceives opportunities for profitable investments;
ii. Explores the prospects of starting such a manufacturing enterprise;
iii. Obtains necessary industrial licenses;
iv. Arranges initial capital;
v. Provides personal guarantees to the financial institutions;
vi. Promises to meet the shortfalls in the capital; and Co
vii. Supplies technical know-how.

4. Classification of Entrepreneurs
The entrepreneurs have been broadly classified according to the type of business, use of
professional skill, motivation, growth and stages of development.

The above classification of entrepreneurs is not exhaustive, for it aims at highlighting the
broad range of entrepreneurs found in business and profession

4.1. Entrepreneurs According to the Type of Business

Entrepreneurs are found in various types of business coronations of varying size.

We may broadly classify them as follows:

Business Entrepreneur: Business entrepreneurs are individuals who conceive an idea
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for a new product or service and-then creates a business to materialize their idea into
reality. They tap both production and marketing‘ resources in their search to develop a
new business opportunity. They may set up a big establishment or a small business unit.
They are called small business entrepreneurs when found in— small business units
such as printing press, textile processing house, advertising agency; readymade
garments, or confectionery. In a majority of cases, entrepreneurs are found in small
trading and manufacturing business and entrepreneurship flourishes when the size of
the business is small.

Trading Entrepreneur: Trading entrepreneur is one who undertakes trading activities

and is not concerned with the manufacturing work. He identifies potential markets,
stimulates demand for his product line and creates a desire and interest among. buyers
to go in for his product. He is engaged in both domestic and overseas trade. Britain, due
to geographical limitations, has developed trade through trading entrepreneurs. These
entrepreneurs demonstrate their ability in pushing many ideas ahead to promote their
business.

Industrial Entrepreneur: Industrial entrepreneur is essentially. A manufacturer, who

identifies the potential needs of customers and tailors a product or service to meet the
marketing needs. He is a product-oriented man who starts in an industrial unit because
of the possibility of making some new product. The entrepreneur has the ability to
convert economic resources and technology into a considerably profitable venture. He is
found in industrial units as the electronic industry, textile units, machine tools or
videocassette tape factory and the like.

Corporate Entrepreneur: Corporate entrepreneur is a person who demonstrates his

innovative skill in organizing and managing corporate undertaking. A corporate
undertaking is a form of business‘ organization, which is registered under some statute
or Act, which gives it a separate legal entity. A trust registered under the Trust Act, or
companies registered under the Companies Act are example of corporate undertakings.
A corporate entrepreneur is thus an individual who plans, develops and manages a
Corporate body.

Agricultural Entrepreneur: Agricultural entrepreneurs are those entrepreneurs who

undertake agricultural activities as raising and marketing of crops, fertilisers and other
inputs of agriculture.

They are motivated to raise agriculture through mechanization, irrigation and application
of technologies for dry land agriculture products. They cover a broad spectrum of the
agricultural sector and includes its allied occupations.

4.2. Entrepreneurs in Technology

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The application of new technology in various succors of the national economy is

essential for the future growth of business.
We may broadly classify these. entrepreneurs on the basis of the use of technology as
follows:

Technical Entrepreneur : A technical entrepreneur is essentially compared to a

―craftsman.‖ He develops improved quality of goods because of his craftsmanship. He
concentrates more on production than marketing. On not much sales generation by and
does not do various sales promotional techniques. He demonstrates his innovative
capabilities in matter of production of goods and rendering of services. The greatest
strength, which the technical entrepreneur has, is his skill in production techniques.

Non-technical Entrepreneur: Non-technical entrepreneurs 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.

Professional Entrepreneur: Professional entrepreneur is a person who is interested in

establishing a business, but does not have interest in managing or operating it once it is
established. A professional entrepreneur sells out the running business and starts
another venture with the sales proceeds. Such an entrepreneur is dynamic and he
conceives new ideas to develop alternative projects.

4.3. Entrepreneur and Motivation

Motivation is the force that influences the efforts of the entrepreneur to achieve his.
objectives. An entrepreneur is motivated to achieve or prove his excellence in job
performance.
He is also motivated to influence others by demonstrating his business acumen.

Pure Entrepreneur: A pure entrepreneur is an individual who is motivated by

psychological and economic rewards. He undertakes an entrepreneurial activity for his
personal satisfaction in work, ego or status.

Induced Entrepreneur: Induced entrepreneur is one who is induced to take up an

entrepreneurial task due to the policy measures of the government that provides
assistance, Incentives, concessions and necessary overhead, facilities to start a venture.
Most of the. induced entrepreneurs enter business due to financial, technical and several
other facilities provided to them by the state agencies to promote entrepreneurship. A
person with a sound project is provided package assistance to his project. Today, import
restriction and allocation to production quotas to small units have induced many people

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to start a small-scale industry.

Motivated Entrepreneur: New entrepreneurs are motivated by the desire for selffulfillment.
They come into being because of the possibility of making and marketing
some new product for the use of consumers. If the product is developed to a saleable stage, the
entrepreneur is further motivated by reward in terms of profit.

Spontaneous Entrepreneur: These entrepreneurs start their business their by

Entrepreneur. They are persons with initiative, boldness and confidence in their_- ability,
which activate, them, underage entrepreneurial activity. Such entrepreneurs have a
strong conviction and confidence in their inborn ability.

4.4. Growth and Entrepreneurs

The development of a new venture has a greater chance of success. The entrepreneurs
a new and open field of business. The customer‘s approval to the new product gives
them psychological satisfaction and enormous profit. The industrial units are identified as
units of high growth, medium growth and low growth industries and as such we have
―Growth Entrepreneur‖ and ―Super-Growth Entrepreneur.‖

Growth Entrepreneur: Growth entrepreneurs are those who necessarily take up a high
growth industry which has substantial growth prospects.

Super-Growth Entrepreneur: Super-growth entrepreneurs are those who have shown

enormous growth of performance in their venture. The growth performance is identified
by the liquidity of funds, profitability and gearing.

8.4. Entrepreneur and Stages of Development

Entrepreneurs may also be classified as the first generation entrepreneur, modern
entrepreneur and classical entrepreneur depending upon the stage of development.
They are explained below:

First-Generation Entrepreneur: A first-generation entrepreneur is one who starts an.

industrial unit by innovative skill. He is essentially an innovator, combining different technologies
to produce a marketable product or service.

Modern Entrepreneur: A modern entrepreneur is one who undertakes those ventures,

which go well along with the changing demand in the market. They undertake those ventures,
which suit the current marketing needs.

Classical Entrepreneur: A classical entrepreneur is one who is concerned with the customers
and marketing needs through the development. of a self-supporting venture. He is a stereotype

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entrepreneur whose aim is to maximise his economic returns at a level consistent ‗with the
survival of the ‗firm with or without an element of growth.

4.5. Others

Innovating Entrepreneurs: Innovating entrepreneurship is characterised by aggressive

assemblage in information and analysis of results, deriving from a novel combination of
factors.

Men / women in this group are generally aggressive in experimentation who exhibit
cleverness in putting attractive possibilities into practice. One need not invent but
convert even old established products or services by changing their utility, their value,
their economic characteristics into something new, attractive and utilitarian. Therein lies
the key to their phenomenal success. Such an entrepreneur is one who sees the

opportunity for introducing a new technique of production process or a new commodity

or a new market or a new service or even the reorganization of an existing enterprise.
Innovating entrepreneurs are very commonly found in developed countries. There is
death of such entrepreneurs in underdeveloped countries.

A country with little or no

industrial tradition can hardly produce innovating entrepreneurs. Such entrepreneurs can
emerge and work only when a certain level of development is already achieved and
people look forward to change and progress.
Innovating entrepreneurs played the key role in the rise of modern capitalism through
their enterprising spirit, hope of money making, ability to recognize. and exploit
opportunities, etc. Innovative entrepreneurs are creative and always bring in innovation
in their work.

Imitative Entrepreneurs: Imitative entrepreneurship is characterised by readiness to

adopt successful innovations by entrepreneurs. They imitate techniques and technology
innovated by others. They are adoptive and more flexible.

Imitative entrepreneurs are also revolutionary and important. The importance of these humbler
entrepreneurs who exploit possibilities as they present themselves and mostly on a small scale
must not be underestimated. In the first place, such adaptation requires no mean ability. It often
involves what has aptly been called subjective innovation‘, that is the ability to do things which
have not been done before by the particular industrialist, even though, unknown to him, the
problem may have been solved in the same way by others. By western standards, an imitative
entrepreneur may be a pedestrian figure, an adopter and imitator rather than a true innovator.
He is more an organiser of factors of production than a creator. But in a poor country attempting

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to industrialize, he is nevertheless a potent change producing figure. He can set in motion the
chain reaction, which leads to cumulative progress.

This humbler type of entrepreneur is important in undeveloped countries.

4.6. Conclusion
It should be noted that private entrepreneurship has to harmonies economic opportunities with
social and moral responsibility. As our wise people have said, unless the pursuit of wealth is
integrated with the pursuit of Dharma, there could be no lasting prosperity and peace, whether
within a country or among nations. The highly developed countries have realized that
aggressive entrepreneurship without an ethical base can‘ produce more harm than good, more
misery than happiness and more destruction than creation. Harmonized planning of economic
and moral values is a long-drawn-out process, but the goal has to be kept in mind constantly.
One should remain optimistic that entrepreneurship in India will develop on these lines to
promote India‘s economic development on a sound basis, as an integral part of the
development of the economy he burst of creativity and innovation in emerging teleological
industries holds promise for economic development and growth of technology and business.
When talent is linked with technology, people recognize and then push viable ideas and the
entrepreneurial process is under way.

In this time of rapid socio-economic development and technological change, the entrepreneurial
spirit can be of advantage but only if we learn to use it. The entrepreneurs are the agents of
change and our hope for the future.

5. Importance of an Entrepreneur
The Entrepreneur is one of the most important inputs in the economic development of a
country or of regions within the country. Entrepreneurial competence makes all the difference in
the rate of economic growth. In India, state and private entrepreneurship co-exist.

The smalI scale industrial sector and business are left completely to private entrepreneurs. It is
in this context that an increasingly important role has been assigned to the identification and
promotion of entrepreneurs for this sector.

The need for a broad-based entrepreneurial class in India arises from the need to speed up the
process of activating the factors of production, leading to a higher rate of economic growth,
dispersal of economic activities, development of backward and tribal areas, creation of
employment opportunities, improvement in the standard of living of the weaker sections of the
society and involvement of all sections of the society in the process of growth.

The entrepreneur is a critical factor in the socio-economic change. He is the key person who
envisages new opportunities, new techniques, new lines of production, new products and
coordinates all other activities.
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Several factors go into the making of an entrepreneur. Individuals who initiate, establish,
maintain and expand new enterprises constitute the entrepreneurial class. The socialpolitical
and economic conditions, the availability of industrial technology and know— how, state of art
and culture of business and trading, existence of markets for products and services and the
incentives and facilities available for starting an industry or business, all have a bearing on the
growth of entrepreneurship. A conducive environment is created through the policies and
interest of the government in economic and industrial development.

6. Entrepreneurial Behaviors, Attributes & Skills

Entrepreneurial Behaviors
• Grasping opportunity
• Taking initiative
• Solving problems creatively
• Managing autonomously
• Taking responsibility for, and ownership of things
• Seeing things through
• Networking effectively to manage interdependence
• Putting things together creatively
• Using judgment to take calculated risk.

Entrepreneurial Attributes
• Achievement orientation and ambition
• Self confidence and self esteem
• Perseverance
• High internal locus of control (autonomy)
• Action orientation
• Preference for learning by doing
• Hard-working
• Determination
• Creativity

Entrepreneurial Skills
• Creative problem-solving
• Persuading
• Negotiating

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• Selling
• Proposing
• Holistically managing business/projects/situations
• Strategic thinking
• Initiative decision-making under certainty
• Networking Skills
• Visualization
• Planning
• Risk-Taking
• Ability To Deal With Situations
• Organization
• Elicit Positive Response From Administrators, Bankers, Infrastructure

• Institutions, Clients And Employees

• Understanding Of Marketing, Quality Control, Finance, Banking, Commercial Law,
Government Regulations And Procedures, Taxation And: Human Relations
• Awareness Of Technology, Tools And Equipment And Machinery
• Knowledge Of The Product, Processes, Packaging, Advertising And Market
Potential

7. Entrepreneur & Entrepreneurship

The term ―entrepreneur‖ is often used interchangeably with ―entrepreneurship.‖ But,
conceptually; they are different, yet they are just like the two sides of a coin. Their
differences are as follows:

Entrepreneur Entrepreneurship
Refers to a Person Refers to a Process
Visualiser Vision
Creator Creation
Organiser Organization -
Innovator Innovation
Technician Technology
Initiator Initiative
Decision-maker - Decision
Planner Planning
Leader Leadership
Motivator Motivation
Programmer Action
Risk-taker Risk-taking

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Communicator Communication
Administrator Administration

8. Entrepreneur, Manager & Intrapreneur

Introduction
An effective entrepreneurial strategy should be an integral part of an enterprise‘s competitive
positioning. The progressive development in the size of business and the separation of
ownership and management in enterprises has made management a distinct profession.
Although both strive to achieve the similar goals they are said to distinguish themselves in
varied measures.

A professional manager is one who specializes in the work of planning, organizing, leading and
controlling the efforts of others by the systematic used of classified knowledge and principles.
He subscribes to the standards of practice and code of ethics established by a recognized body.

To be a professional manager he should

i. have an insight of his job requirements;
ii. carry out continuous updating of his learning to fulfill his job requirements;
iii. have a performance-oriented relationship with his subordinates, super-ordinates and
colleagues based on mutual respect to facilitate team work for collective contribution to the
organization;
iv. have a relationship based on long-term mutual benefit approach with customers, suppliers
and other members of the public, and
v. have communication with colleagues to improve the standard contribution and the
prestige managerial profession.

Professional Management
The progressive development in the size of business and the separation of ownership and
management in the corporate enterprises have contributed to the emergence of management
as a distinct profession. A management can be professional not, by hiring professional
managers but by adopting the style of professional management. Professional management

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organizes managerial functions by setting long-term objectives, formulating policies and

strategies, developing formal communication network and evaluation system to deal with the
emergence of business problems.

The characteristics of professional management are as follows:

Body of Knowledge: Management theory has a philosophy of its own. It is based on

systematic and scientific studies. Precisely, the management of knowledge is‘ the passport to
enter the world of entrepreneurship.

Management Tools: Tools of management such as accounting, business law, psychology,

statistics and data processing have been developed to enhance the practical utility of the
science of management.

Specialization: There is a growing tendency to select and appoint highly qualified, trained and
experienced persons to manage the business in each functional area of management. This has
created greater demand for professionals.

Separate Discipline: Management studies in many universities and institutions of higher

learning are recognized as a separate discipline. Seminars, special courses, and training
programmes have become essential in management areas like export management, personnel
management, production management, marketing management, financial‘ management, etc.

Code of Conduct: Business management is regarded as a social institution. It has social.

responsibilities towards customers, employees‘ and the society on the whole. Consumer-
oriented marketing concept is an important corporate code of conduct. Pressure of
consumerism, trade unionism, public opinion and legislation are definitely inducing the
management to evolve a code of ethics for consumer satisfactions and holding a major market
share.

Professional Association: In our country too, business management associations have‘ been
formed. They mainly aim at spreading the ethics of business management and build up a sound
public image of the managerial profession.

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A professional manager is required to possess specific management knowledge relating

to
(a) Technical processes, products, materials, equipment and procedures;
(b) Economic knowledge about the basic objective of the entrepreneurs and its position in the
economic and social system within which it is operating;
(c) Human knowledge about employee motivation, moral and delegation of authority; and
(d) Administrative knowledge about application and analysis of data. This will facilitate him to
deal with various problems of the organisation in an effective manner.

A person can become a professional manager by the acquisition of knowledge through

formal education. . An owner-manager can achieve success due to his personal cultural
traits. Many great entrepreneurs are self-made, for they were not handicapped by their
lack of formal education but came out as successful entrepreneurs due to their skill and
intelligence. One can easily identify such an entrepreneur manager in any profession, may it
retailing or wholesaling.

Managers and Entrepreneurs

Both managers and entrepreneurs are answerable for producing results. The results are, of
course, different. In their respective result areas, the buck stops with them. While they can
delegate, they are finally accountable.

Both have to produce results through people working with them though they deal with different
sets of people. They are not effective in the long run, if they are loners. Both are decision-
makers but the decisions are different as their tasks vary. Both have to operate under
constraints, which are understandably different.

To be effective in their respective roles, both have to follow sound principles of management like
planning, staffing, delegation and control. The focus of these management tools may vary
depending upon the ultimate purpose.

Similarities Between Managers and Entrepreneurs

• To produce results
• To produce results through people
• To take decisions
• To cooperate under constraints
• To follow sound principles of management

A successful organisation needs both entrepreneurship and management. The entrepreneurial

role may be played by the Chief Executive and his team of top-level executives, the managerial
role by the middle-level and joint-level executives;

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A Management Tool
The efficiency of professional management lies in the managerial approach, which does not
suffer from dogmatic, ideological and political trappings. It is an approach which trackless the
problem as a ‗whole‘ and not in ‗fractions.‘

The professional manager brings into operation planning, organising, staffing, motivating,
controlling and coordinating the work of technocrats and professional aspects to achieve
predetermined goals. The professional manager must possess a desire to achieve, to expand,
to build and to grow. His goal should be to produce the best results in the shortest time and at
least cost. The manager, who has had to benefit of management education and has exposed to
the managerial tools and techniques of achieving the profit-cum-growth, will be in a position to
deliver the goods to in developing economy like ours.

It is characteristic of an established profession that its members accept the obligation to

contribute to the advancement of standards and to the education of the future aspirants.

The more eminent the member, the more readily he recognizes the obligation. ‗It is quite likely
that his personal contribution to teaching may be small but it will be of high quality. This is the
task facing the professional managers of the future. The entrepreneur may be a, manager but a
paid manager cannot acquire the position of an entrepreneur.

An entrepreneur has great motivation to manage his business successfully. He is keen towards
developing business through innovation, and is satisfied when his efforts give him positive
results. He is the investor, risk-bearer, manager and controller.

The entrepreneur may appoint a manager and delegate some of his functions. However,
manager even after performing his assigned duties cannot substitute the entrepreneur.

The entrepreneur lays down a broad policy for business, assumes risk and makes the business
a concern. The main factors, which distinguish an entrepreneur from a professional manager as
shown below:

Distinctive Features of Entrepreneurs and Professional Manager

Professional Manager Entrepreneur

1. Perception of an/opportunity 1. Setting of objectives
2. Risk-taking 2. Policy formulation
3. Tactical Planning 3. Strategic Planning
4. Interpersonal communication 4. Formal communication
5. Negotiating 5. Organising
6. Troubleshooting 6. Motivating
7. Making it a growing concern 7 Controlling
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8. Innovator 8. Administrator
9. Motivator 9. Skilled, knowledgeable
10. Determined 10. Confident
11. Idealist 11. Specialist
12. Committed 12. Loyal
13. Visionary 13. Planner
14. Planner 14. Implementer

Entrepreneur vs. Manager

The, entrepreneur is a person who is motivated satisfy a high need for achievement in
innovative and creative activities. His creative behaviour and innovative spirit which forms a
process of an endless chain is termed as entrepreneurship.

It is not enough for the entrepreneur to build up the process, but equally important task for him
is to manage the business. He performs entrepreneurial vis-à-vis managerial functions. The
entrepreneur enters at a transitional stage in which what is initially with innovation becomes a
routine, for him the transition from entrepreneurship to management.

Also, the emphasis switches from techniques and analytical methods to insight and to
involvement with people. The entrepreneur perceives and exploits opportunity, and the
subsequent steps necessary for organization and pertinent to management.

The entrepreneur differs from the professional manager in that he undertakes a venture for his
personal gratification. As such he cannot live within the framework of occupational behaviour set
by others. He may engage professional manager to perform some of his functions such as
setting of objectives, policies, procedures, rules, strategies and formal communication network.

However; the entrepreneurial functions of innovation? Assumption of business risk and

commitment to his vision cannot be delegated to the‘ professional manager. Failure to the
professional executive may mean a little more than locating a new job perhaps even at a higher
salary, whereas failure of an entrepreneur in his efforts would mean a devastating loss to his
career. The professional manager has to work within the framework of policy guidelines laid
down by the entrepreneur.

Intrapreneurs

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Of late, a new breed of corporate entrepreneurs has come to the fore in large organizations.
They are called ―intrapreneurs.‖ They are entrepreneurs who catch hold of a new idea for a
product, service, or process and work to bring this idea to fruition within the framework of the
organisation. Intrapreneurs with their innovations and dedicated effort are perceived as a
valuable asset by the organisation, inspiring others. He serves as a champion to others in the
organisation. In America, a number of intrapreneurs are leaving their jobs to start their own
ventures. Many such intrapreneurs have become exceedingly successful in their new ventures
and, what is more, they are causing a threat to the companies they left a few years ago.

9. Case Study
The Great Indian Dreamer

Many Indian businessmen have successfully replicated what has been done elsewhere or
moved beyond traditional areas, but ITC‘s Deveshwar alone has dared to dream of what never
was (By- Swami Nathan S Anklesaria Aiyar).

One of my favourite posters says, ―Some people see the world as it is, and ask why. But I think
of things that never were, and ask, why not?‖

Management gurus may wax eloquent over sticking to the knitting and focusing on core
competence. But the truly outstanding businessmen are those that can think out of the box.
These are the great dreamers that produce great leaps forward.

How many top Indian businessmen qualify for the title of Great Dreamer? Hardly any. Most are
dynastic successors, following in the footsteps of their fathers (Mukesh Ambani and Kumar, to
name only two). Some have indeed come up with new dreams, but these are typically dreams
about doing in India what has been done elsewhere. Very rarely are they about things that
never were.

Consider Ratan Tata, who has strong credentials. In the 1980s, when most Indian
businessmen, including JRD Tata, were still focusing on manufacturing empires, Ratan saw the
huge potential of high technology. He suffered severe setbacks like the flopping of ventures like
Elxsi and Plantek abroad, but persisted. He reaped his high-tech reward in the 1990s when Tata
Consultancy Service emerged as a global power.

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His other big dream was to produce a made-in-India car. His first attempts via the Tata Sierra
and Tata Estate were disastrous. Institutional investors feared that Ratan‘s dream of making an
indigenous car would bankrupt India‘s best truck company. Why not stick to the knitting? When
the Indica was launched and initially flopped, there was a chorus of ―I told you so.‖ But Ratan
fixed the problems of the Indica and relaunched it. The new version proved a winner. It is now
set to capture global markets, through a marketing tieup with British Rover.

Ratan Tata certainly broke new ground in India, and in the Tata group. But in effect he repeated
in India what had been done abroad. He did not invent software, he replicated in TCS what had
been done elsewhere. He justified Telco‘s entry into cars by saying that many companies the
world over (like General Motors and Toyota) made both cars and trucks. So, he was a Great
Replicator rather than a Great Dreamer.

Does Narayanmurthy of Infosys deserve the title of Great Dreamer? Which other professional
engineer in the 1980s could have dreamed of overtaking the biggest captains of industry in
India? Indian engineers used to think of themselves as employees, not as employers, let alone
potential multinationals. Narayanmurthy broke that mould.

Yet he did no more than replicate what thousands of software professionals had already done
abroad. In Silicon Valley and elsewhere, software professionals had set up their own
companies, often with the help of venture capital. To do the same in India was far more
daunting and challenging. The controls were strangulating, venture capital was absent, and
India had a terrible global image, Narayanmurthy can justly claim fame for providing that what
was possible in Silicon Valley is also possible in India. But that does not quite qualify as Great
Dreaming.

INDEED, some would say that Azim Premji was the greater dreamer. Narayanmurthy
was trained in software and continued in the same field. But Premji came from a business family
making vegetable oil. He could have stuck to the knitting and become India‘s biggest edible oil
producer. Instead, he diversified into computer hardware and software. Premji is undoubtedly a
Great Diversifier, but that is not the same thing as a Great Dreamer.

Pramod Bhasin of GE Capital also has good credentials. To him goes the credit of first
visualizing India as the business process outsourcing (BPO) capital of the world. His vision is
now driving an entirely new service industry, and the mighty USA is worried about losing
millions of jobs to India.

But Bhasin too was a replicate. BPO first emerged in Ireland and the Caribbean, and Bhasin‘s
key achievement was to see that this could be done even better in India.

Who, then, can really claim to have dreamed of things that never were and asked
why not? I can think of only one name; Yogi Deveshwar.

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As Chairman of ITC, he could have continued producing cigarettes, or building more ITC
hostels. Instead, he has invented the concept of the e-choupal, and aims to create the biggest
agricultural distribution system in India by linking farmers to markets through the internet. The
vision itself is breathtaking, bridging the supposed digital divide in one great leap. The world
over, many governments have talked of using the internet as a tool of grassroots empowerment,
and some have done so through large-scale public investment and subsidies (Digvijay Singh‘s
Gyandoot project in Madhya Pradesh is good example).

But Deveshwar had the vision to see the e-choupal as a commercial operation, and hence
capable of replication throughout India without political subsidies and intervention. Large
farmers and traditional middlemen (arhaitis) have been hired by ITC to help run-echoupals,
harnessing their traditional knowledge.

ITC is creating several new e-choupals every day, and has already established over 3,000 of
them, connecting 18,000 villages. Deveshwar wants to cover the whole of India, and in the
process make the e-choupal business bigger than even ITC‘s cigarette business,

That is something no other company or country has attempted. Others in India (like Drishtee)
have also tried to use the internet for rural marketing, but these have been small –scale efforts.
None has attempted anything with the breadth and speed that Deveshwar has displayed. When
he became head of ITC in the mid-1990s, I voiced fears that he was an opportunist trying to use
bogus patriotism to grab power from the major shareholder, BAT. I was plain wrong, and need
to eat crow. Deveshwar gets my vote for the title of the Great Indian Dreamer.

Enterprise makes the difference

• China‘s reforms predated ours by fifteen years; but mainland China had no strong private
industrial enterprises like India‘s.

• Major industries like steel, aluminium, cement, chemicals and pharmaceuticals are still
dominated by Indian companies.

• Indian companies with improved practices have ably defended their turf.

Following India‘s economic reforms, western businessmen used to point out how basely India
fared in FDI compared with China. But maintained that they underestimated India. The two
countries‘ conditions differed markedly china‘s reforms pre dated ours by fifteen years; china‘s
reforms predated ours by fifteen years; but mainland china has no strong private industrial
enterprises like India‘s.

Foreign investors have had to compete against established Indian business, with our entry
barriers higher and business better or entry barriers higher and business better originated.

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Trained, experienced manager is a resource in which India scores over China. So, China has
giants like computer maker Legend, But Indians are setting up operations in China in fields like
Parma, IT and automotives. Also, foreign firms have interred India post-1991 in industries like
cell phones or IT equipment. Their advertising levels are such as to make one wonder how
Indian owned firms can ever survive them. Yet, their share in the Indian economy is small. Major
industries like steel, aluminum, cement, chemicals and pharmaceuticals are still dominated by
Indian companies. And, despite fears that Indian concerns would be wiped out many have even
survived (and improved sales) in sectors like automotive and consumer electronics.

Foreign concerns have succeeded in sectors giving them the advantage of scale. It equipment
is one such. An added factor has been access to technology that Indian firms lacked, as in
mobile phones. Indian companies have thus had more success in technology- neutral areas,
surmounting FDI. Mean while, foreign knowledge of the Indian market is inferior, as is the
networking. But, now that interest rates are down, their only other advantage is better
management practices. Indian companies with improved practices have thus ably defended
their turf; they also often profit from lower capital costs owing to older plant and equipment.
What has distinguished winners firm losers is a greater commitment to enterprise, and better
business practices.

The Tata oil Mills Company investment led many to write off the conglomerate as having
no appetite for competition. Analysts also gave Tata motors the thumbs- down when it launched
India‘s first indigenously designed car, the indicate But, very soon, Tata tea tool over Tetley
(UK) to become the world‘s second largest tea company. Tata steel too streamlined itself and
became one of the world‘s lowest cost steel producers. Even Tata Chemicals has been turned
around dramatically. Suddenly market analysts are bending over backward to give high marks
to Tata concerns. The Aditya Birla group too has tremendous resilience. Following the short
listed advance of Indian cement companies like India cements, and the foreign Lafarge, the
group executed a coup by acquiring.

L&T‘s cement business to become India‘s top cement producer. Also, it has taken over the
premium garments business of Coats Viyella (UK) and acquired foreign controlled Indian
Aluminium despite Sterlite. It is making upstream acquisitions abroad. Such groups have built
India‘s Industrial foundations – pioneering in steel, power, cement, chemicals, aluminium,
automobiles and IT. Creation of industrial assets apart, they harnessed new technologies and
built strong organizations and marketing networks that spanned the country. And they built
brand power. The Tata Group‘s senior managers believe they created Institutionalized
enterprise‘.

Other groups like Bharat Forge, Dr Reddy‘s, Hero Honda, L&T, Ranbaxy, Reliance, and TVS
also have a tradition of enterprise and are entrenched in India‘s marketplace. Many pharma
companies have set up outside India, and the Indian auto components industry is beginning to
be taken seriously as a possible world supplier.

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Today economists liken India to a further economic powerhouse. But that will first need reform,
stable policies and an end to religious fanaticism. Much additionally depends on the success of
Indian business groups in adopting the right strategies and improving business processes to
compete globally.

Such groups still carry some past baggage. The license raj encouraged arrogance towards
stakeholders, and bureaucratic, wasteful habits. Those must be jettisoned and companies must
learn to harness new-age technologies (like Internet), something is which most Indian
companies lag.

Where manufacturing process technology is not the key factor of success, Indian companies
have a natural advantage compared with foreign companies, especially the new entrants. If it is
unable to compete, it will have only itself to blame – leaving the field open to the Chinese, who
are fast learners.

10. Barriers to Entrepreneurship

A large number of entrepreneurs particularly in the small enterprises fall due to several
problems and barriers.

Entry barriers are those forces limiting access to identified business opportunities and
capitalization on these opportunities.

Survival barriers are constraints on the conditions essential for the small business entity.
Exit barriers are constraints limiting the termination of small industrial ventures that have
outlived their business viability or the growth of such ventures to a different size category.

Entry Barriers
1. Lack of a viable concept.
2. Lack of market knowledge
3. Lack of technical skills
4. Lack of seed capital
5. Lack of business know-how
6. Complacency - lack of motivation
7. Social stigma
8. Time presences and distractions
9. Legal constraints and regulations
10. Monopoly and protectionism
11. Inhibitions due to patents
12 . A cultural bias in identifying and managing the entrepreneurial development process.
13. Limited industry-specific data and insufficient market information.
14. Limited effectiveness of the infrastructure base.
15. Existence of visible and invisible obstacles to entry of a specific societal group (e.g. women)
into business. .
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16. Unorganized capital market and traditional feasibility assessment processes.

17. Unsympathetic and cumbersome government attitude.
18. Hostile environment
19. Limited access to technology.

Survival Barriers
1. A behavioural pattern that could impair basic managerial practices.
2. Constraining practices within the capital market.
3. The threatening shadow of changing technology.
4. Limited learning
5. The cultural management of resources
6. Failure of guidance agencies to guide.
7. Scarce information and limited dissemination of that information.

Exit Barriers
1. The emotional commitment of the entrepreneur to his venture.
2. Specialized assets, sunk funds..
3. The increasing demand for managerial skills.
4. Fear of failure.

11. Strategic Management – Definition & Concept

Strategic Management is defined as the set of decisions and actions resulting in formulation and
implementation of strategies designed to achieve the objectives of organization. It covers the
entire cycle of planning and control at strategic level.

strategic management include:

• Strategic analysis
• Environmental scanning
• Strategic planning
• Choice of strategies
• Implementation of strategies
• Review and control

VISION

• The faculty or state of being able to see

• The ability to think about or plan the future with imagination or wisdom
• A mental image produced by the imagination

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• A vision statement is a declaration of a company's goals for the midterm or long-term

future
• Aspirational in nature, vision statements lay out the most important primary goals for a
company

MISSION

A What business are we in? Answer to this question requires a consideration of the mission
definition or the scope of the business activities the firm pursues.

The mission of a business may be defined as the

―Fundamental, unique purpose that sets it apart from other firms of its type

• Corporate mission spells out the scope of operation in terms of products and markets or of
service and client

• Through its mission, a company indicates what it is trying to achieve and in what field

In short, mission represents the stylistic objectives of company

OBJECTIVE

This question involves establishing objectives to be accomplished. Both questions help define
the nature of business and provide a framework for analysis, choice, implementation and
evaluation processes

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12. Business Plan

• The owner/manager lacks the skills to run the day-to-day operations of the business

• The business lacks a solid business plan

• The business is under-capitalized

• Lack of understanding of its customer base

• The business is established at the wrong time or in the wrong location

• The business doesn‘t understand or value customer service

Definition of a Business Plan

A written summary of an entrepreneur‘s proposed venture, its operational and financial details,
its marketing opportunities and strategy, and its managers‘ skills and abilities.

• Creates consistent ―Blue Print‖ for the business (Serves as ―check list‖)

• Idea of marketing, financing, operating potential prior to investment

• Gives last chance to fail on paper

• Strategic partnering

• To attract key people

• Build commitment among team members

Business Opportunity Identification

• Planning Commission (5 Year Plans)

• Suggestions by FIs, CARE, CRISIL, ICRA

• New / Emerging Technologies

• Survey of Local Sources

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• Emulating Consumption Pattern from Abroad

• Restoring Life to Sick Units

• Trade Fairs & Exhibitions

The 6 Habits of True Strategic

Thinkers
You're the boss, but you still spend too much time on the day-to-day. Here's how to
become the strategic leader your company needs.

In the beginning, there was just you and your partners. You did every job. You coded, you
met with investors, you emptied the trash and phoned in the midnight pizza. Now you have
others to do all that and it's time for you to "be strategic."

Whatever that means.

If you find yourself resisting "being strategic," because it sounds like a fast track to
irrelevance, or vaguely like an excuse to slack off, you're not alone. Every leader's
temptation is to deal with what's directly in front, because it always seems more urgent and
concrete. Unfortunately, if you do that, you put your company at risk. While you concentrate
on steering around potholes, you'll miss windfall opportunities, not to mention any signals
that the road you're on is leading off a cliff.

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This is a tough job, make no mistake. "We need strategic leaders!‖ is a pretty constant
refrain at every company, large and small. One reason the job is so tough: no one really
understands what it entails. It's hard to be a strategic leader if you don't know what strategic
leaders are supposed to do.

After two decades of advising organizations large and small, my colleagues and I have
formed a clear idea of what's required of you in this role. Adaptive strategic leaders — the
kind who thrive in today’s uncertain environment – do six things well:

Anticipate

Most of the focus at most companies is on what’s directly ahead. The leaders lack
―peripheral vision.‖ This can leave your company vulnerable to rivals who detect and act on
ambiguous signals. To anticipate well, you must:

 Look for game-changing information at the periphery of your industry

 Search beyond the current boundaries of your business
 Build wide external networks to help you scan the horizon better

Think Critically

―Conventional wisdom‖ opens you to fewer raised eyebrows and second guessing. But if you
swallow every management fad, herdlike belief, and safe opinion at face value, your
company loses all competitive advantage. Critical thinkers question everything. To master
this skill you must force yourself to:

 Reframe problems to get to the bottom of things, in terms of root causes

 Challenge current beliefs and mindsets, including their own
 Uncover hypocrisy, manipulation, and bias in organizational decisions

Interpret

Ambiguity is unsettling. Faced with it, the temptation is to reach for a fast (and potentially
wrongheaded) solution. A good strategic leader holds steady, synthesizing information
from many sources before developing a viewpoint. To get good at this, you have to:

 Seek patterns in multiple sources of data

 Encourage others to do the same
 Question prevailing assumptions and test multiple hypotheses simultaneously

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Decide

Many leaders fall pretty to ―analysis paralysis.‖ You have to develop processes and enforce
them, so that you arrive at a ―good enough‖ position. To do that well, you have to:

 Carefully frame the decision to get to the crux of the matter

 Balance speed, rigor, quality and agility. Leave perfection to higher powers
 Take a stand even with incomplete information and amid diverse views

Align

Total consensus is rare. A strategic leader must foster open dialogue, build trust and engage
key stakeholders, especially when views diverge. To pull that off, you need to:

 Understand what drives other people's agendas, including what remains hidden
 Bring tough issues to the surface, even when it's uncomfortable
 Assess risk tolerance and follow through to build the necessary support

Learn

As your company grows, honest feedback is harder and harder to come by. You have to do
what you can to keep it coming. This is crucial because success and failure--especially
failure--are valuable sources of organizational learning. Here's what you need to do:

 Encourage and exemplify honest, rigorous debriefs to extract lessons

 Shift course quickly if you realize you're off track

Celebrate both success and (well-intentioned) failures that provide insight

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7 Things Great Entrepreneurs Don't Do

These days, everyone with a MacBook and a blog thinks he’s an entrepreneur. Well, here’s a
little tough love for the entrepreneurial generation: Calling yourself a CEO doesn’t make you
one and a small army of Twitter followers doesn’t make you a leader, either.
As a wise VC who’s name escapes me once said, “There are entrepreneurs and there are
Entrepreneurs.”

Not to dash your hopes and dreams, but the truth is the vast majority of you simply aren’t cut
out to be entrepreneurs or leaders. I know you don’t want to hear that, but it’s true. And the
sooner you realize you’re not going to be the second coming of Mark Zuckerberg, the better.

Don’t get me wrong. It’s great to reach for the stars. As Robert Browning said, “A man’s reach
should exceed his grasp.” But having grown up in the high-tech industry and worked with
hundreds of real CEOs, VCs, and Entrepreneurs for decades, one thing I can tell you is the
word has become so overused, it’s almost meaningless.
So while there is no one-size-fits-all model for true entrepreneurs, in my experience, there
are some things they seem to have in common. This might surprise you, but what sets them
apart isn’t some laundry list of attributes. It’s their actions. What makes them unique is what
they do and, perhaps more importantly, what they don’t do.
1. They don’t think about work-life balance.
They’re mostly workaholics. What that means is their work comes first. It’s what they live
for. They’re not freewheeling, fun-loving people who live for the weekend. They live to do
what they love, and that’s work.

2. They don’t try to be what they’re not.

Probably the most damaging business myth to come along in decades is personal branding.
You are not a product, and you can’t change who you are. Besides, real entrepreneurs don’t
think about themselves. They think about their ideas and how to turn them into great
products and services. And they deliver.

3. They don’t do it for the money.

They don’t whine about how hard they work for peanuts. They just do it. And because they’re
passionate about what they do and focused like a laser beam, the money eventually comes,
big-time.

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4. They don’t have day jobs.

Great entrepreneurs don’t just dip their toes in the water. They jump in headfirst without a
thought about the rocks below. They don’t do a little of this and a little of that. When they
hit on something they think is really cool and exciting, they go all in.

5. They don’t give in to fear.

They don’t pay attention to those voices in their heads – you know, the ones that haunt you
with everything that can go wrong. They’re not fearless, mind you. Nobody is. They just don’t
let their fear stop them from taking risks. They do listen to some voices, though: the voice of
reason and their instincts.

6. They don’t have grand visions.

While some do have grand delusions that they’re destined for greatness – a prophecy that’s
often self-fulfilling, interestingly enough – for the most part, they generally don’t have grand
visions for their companies. Zuckerberg, for example, wasn’t trying to create a company. He
just wanted to rate the looks of fellow classmates.

7. They don’t have virtual mentors.

Most people follow all sorts of writers, bloggers and tweeters these days. That’s fine, but to
get somewhere in life, to do great things, you have to have real mentors in the real world.
Former Intel chairman Andy Grove mentored Steve Jobs. Jobs, in turn, advised Google
founders Larry Page and Sergey Brin. Behind every great entrepreneur is at least one great
mentor. A real one.

Most importantly, real entrepreneurs don’t call themselves entrepreneurs. They don’t do
what everyone else is doing. They don’t follow the status quo, conventional wisdom or
popular fads. They carve their own unique path. They’re leaders of their own destiny. That’s
what drives them. And that’s why they succeed.

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