ENTTREPRENEURSHIP

DEVELOPMENT
 Entrepreneurship

“Entrepreneur always searches for change,

responds to it, and exploits it as an
opportunity.”
Peter Drucker
 Evolution of Entrpreneurship
• Entrepreneurs have always been present, however their
behavioural patterns were different in different periods of time.
• The word entrepreneur was derived from the French word
“entreprendre”, which means “to undertake”, “go-between”
(Kuratko, 2016).
• The usage of the term entrepreneur can be traced from 1755,
wherein an entrepreneur was used to refer to economic
activities. According to Richard Cantilon “ An entrpreneur is a
person who buys factors of production at certain prices in order
to combine them into a product with a view to selling it at
uncertain prices” Thus an entrepreneur is a bearer of risk which
is non-insurable.
 What is Entrepreneurship

“Entrepreneurship is the identification,

evaluation and exploitation of opportunities”
By Shine
 Definition of Entrepreneurship
• Joseph A. Schumpter writes:
“ The entrepreneur in an advanced economy is an individual
who introduces something new in the economy – a method
of production not yet tested by experience in the branch of
manufacturer concerned, a product with which consumers
are not yet familiar, a new source of raw material or of new
markets and the like.”
It is also to reform or revolutionise the pattern of production
by exploiting an invention or more generally an untried
technological possibility for producing a new commodity.
 Drucker Views on Enterpreneurship
• According to Drucker three conditions are to be
fulfilled
• 1. Innovation at work. It requires knowledge and
ingenuity. It makes great demands on diligence,
persistence and commitment.
• 2. To succeed, innovation must build on their
strengths.
• 3. Innovation always has to be close to the market
focused on the market, indeed market-driven.
 Economic Theories of Entrepreneurship
Technological
Capitalist – Adam Knowledge –
Risk Taker –
Smith, 1776, Jeremy
Richard
David Ricardo, Bentham,
Cantillion, 1755
1871 1838

Risk Taker & Capit

Economic Amas alist –
Innovator – 1866 a Walker,
Von Thunen, Change – Carl , Fran
Walk cis
1850 Menger, 1871 er, 18 A.
87
Risk
T
Novel Unc aker &
e
Resource Avoi rtainty or– ess – ,
d t n
Combination Fran ance – n o va h t
Aler Kirzne
r
k Kn In sep al
– Alfred
i
1921 ght, Jo peter, Isre 1973
Marshall, ch um 2
S 195
1920
 Characteristics of an Entrepreneur

The main characteristics of the entrepreneur are due to their sociological and
psychological factors. Some of those characteristics are mentioned below:
Entrepreneurs are vision-oriented people

Entrepreneurs have a high need in achievement

Entrepreneurs do not rely on fate or luck, however they try to control their own
lives
Entrepreneurs undertake moderate risks, which is why they look for high earning
on their investments
Entrepreneurs have the abilities to deal with several ambiguous situations in their ventures.
They face these ambiguous situations and circumstances regularly because they do certain
jobs and tasks which are entirely new by nature.
High energy level- Success of an entrepreneur demands the ability to work long
hours for sustained periods of time.
8
 Characteristics of Entrepreneur
• Mental ability – intelligent and creative thinker
• Human relations ability
• Communication ability – with suppliers and
creditors
• Technical knowledge
 Example (1): Rise of Levi’s
• Problem:
– Working Clothes for Mining Workers do Not Last

• Solution:
– First Pair of Jeans

Enterprise and its Business Environment ©

Goodfellow Publishers 2016
 Example
• Sunil Mittal with no business background started his
first business at age of 18 with borrowed capital of
20,000 for making cycle parts
• He failed
• Then he set bharti healthcare 1983-84 for making
capsules .It didnt work well due to govt. Policies
• He started manufacturing push button telephones and
he never saw back.
• First answering machine, first cordless, first fax
machine.
 Learnings
• His Mantra one achieves in proportion to what
one sets and negotitates.
• Failures are steps to succeed
• Overcome obstacles, suppress anxieties
• Identify the opportunities
• Take risk
• Have high need for achievement
 J.K. Rowling
• Famous author of Harry Potter books
• She wrote her first book in 1995 – got rejected
by 12 publishers
• Her personal life was in mess

• Her brand is worth $15 billion and the second-

richest female entertainer on the planet,
behind Oprah
 Types of Entrepreneur
Based on business
• Trading Entrepreneur
• Manufacturing
• Agricultural
• Based on use of Technology
• Technical Entrepreneur
• Non Technical Entrepreneur
 Based on Ownership
• Private Entrepreneur
• State
• Joint
• Based on Gender
• Men Entrepreneur
• Women
• Based on size
• Small scale
• Medium scale
• Large scale
 Functions of Entrepreneur
• Entrepreneurial functions
• Managerial functions
• Promotional functions
• Commercial functions
 Functions of Entrepreneurs
• Promotional
• Identification and selection of business ideas
• Project Report preparation
• Requirement of finance

• Commercial
• Production
• Marketing
• Accounting