ENTREPRENEURIAL

DEVELOPEMENT

MODULE 1
Who is an Entrepreneur?

A person who takes the risk of converting

a new idea into reality.

Entrepreneur as a Risk- Bearer

Entrepreneur as an Organizer
Entrepreneur as an Innovator
 MEANING
An entrepreneur is a person who has
possession of a new enterprise, venture or
idea and is accountable for the inherent
risks and the outcome.
DEFINITIONS
An individual who bears the risk of
operating a business in the face of
uncertainty about the future conditions.

-Encyclopedia Britannica
An individual is the one who innovates,
and introduces something new in the
economy.
-Joseph A. Schumpeter
EVOLUTION OF THE CONCEPT OF
ENTREPRENEUR
13th Century- The origin of the English word
entrepreneur comes from the French word
ENTERPRENDRE , which means to do
something or to undertake; meant to designate
an organizer of musical or other entertainments.
16th century- Applied to those who were
engaged in military expeditions.
17th century- extended to cover civil engineering
activities : Construction.
18th century- Economic aspect.
Example:
 Dhirubhai Ambani alias Dhirajlal Hirachand Ambani
was born on December 28, 1932, at Chorwad, Gujarat,
into a Modh family. Dhirubhai Ambani started his
entrepreneurial career by filling gas at a shell pump at a
monthly salary of Rs 300.
 Assisted by his two sons, Mukesh and Anil, Dhiru Bhai
Ambani built India’s largest private sector company,
Reliance India Limited, from a scratch. Over time his
business has diversified into a core specialization in
petrochemicals with additional interests in
telecommunications, IT, energy, power, retail, textiles,
infrastructure services, capital market and logistics.
 DIFFERENCE BETWEEN A
MANAGER AND ENTREPRENEUR
ENTREPRENEUR MANAGER
OWN BOSS SALARIED EMPLOYEE
TAKES OWN DECISION EXECUTES THE DECISION OF
THE OWNER
HIRES EMPLOYEES HE IS AN EMPLOYEE
UNCERTAIN REWARDS WHICH FIXED REWARDS AND SALARY
CAN BE UNLIMITED
 FUNCTIONS OF AN
ENTREPRENEUR
Idea generation and scanning of the best
suitable ideas.
Determination of the business objectives.
Product analysis and market research.
Determination of form of Ownership.
Completion of promotional formalities.
Raising necessary funds.
Procuring machine and materials.
Recruitment of men.
Undertaking the business operations.
 WHY SHOULD YOU BECOME AN
ENTREPRENEUR?
 You will be your own boss and boss to other people
 You will the chance to put your ideas into practice
 You will make money for yourself rather than for
someone else
 You may participate in every aspect of running a
business
 You will have the chance to work directly with your
customers
 You will have the personal satisfaction of creating and
running a successful business
 You will be able to work in a field or area that you really
enjoy
 You will have the chance to build retirement value
TYPES OF AN ENTREPRENEUR
Classification Based On Functional Characteristics:
 Innovating entrepreneurs: Introduces new goods,
inaugurates new method of production, discovers
new market and recognizes the enterprises.
 Imitative entrepreneurs: Do not innovate the
changes themselves, they only imitate techniques
and technology innovated by others.
 Fabian entrepreneurs: Enthusiastic in
experimenting any change in their enterprises.
 Drone entrepreneurs: Do not adopt the changes
even be prepared to suffer from the loss of
business.
Contd…
Classification Based On Behavioral Scientist:
Solo operators: Work alone
Active partners: Joint venture
Inventors: Innovative activities
Challengers: Look for new challenges
Buyers: Buy the ongoing business to reduce risk
Life timers: Family business
Contd…
Classification Based On the Developmental Angel:
Prime mover: Entrepreneur look for development,
expansion and diversification of business.
Manager: Entrepreneur does not initiate expansion.
Minor Innovator: Entrepreneur contributes to
economic progress by finding better use of existing
resources.
Satellite: Entrepreneur assumes supplier’s role.
Local trading: Entrepreneur limits his enterprise to the
local market.
E.g.: Small Scale Enterprises
Contd…
Classification Based On type of Entrepreneurial
Business:
Manufacturing: Entrepreneur produces products.
Wholesaling: Entrepreneur sells products to the
middle man.
Retailing: Entrepreneur directly sells the products to
the people who use or consume them.
Service: Entrepreneur sells services rather than
products.
INTRAPRENEUR
AN EMERGING CLASS
A new breed of entrepreneurs is coming
to the force in large industrial
organization and emerge from within the
confines of an existing enterprise.
E.g.: CEO, Directors
 DIFFERENCE BETWEEN
ENTREPRENEUR AND INTRAPRENEUR

Difference Entrepreneur Intrapreneur

Dependency An entrepreneur is An Intrapreneur is
independent in his dependent on the
operations. entrepreneur
Raising of funds An entrepreneur himself Funds are not raised by
raises funds required for the the Intrapreneur.
enterprise.
Risk Entrepreneur bears the risk An Intrapreneur does not
involved in the business. fully bear the risk
involved in the
enterprise.
Operation An entrepreneur operates An Intrapreneur operates
from outside. from within the
organization.
CONCEPT OF ENTREPRENEURSHIP
The process of creating is called as
Entrepreneurship.
Entrepreneurship can be defined as a process of
action an entrepreneur undertakes to establish an
enterprise.
Entrepreneurship is a process of giving birth to a
new enterprise.
According to A.H Cole, “Entrepreneurship is the
purposeful activity of an individual or a group
of associated individuals, undertaken to initiate,
maintain or increase profit by production or
distribution of economic goods and services”.
 EVOLUTION OF
ENTREPRENEURSHIP
Entrepreneurship During Pre- Independent:
Evolution traced back to Rig-Veda: Metal
handicrafts existed in the society.
East India Company- The manufacturing
entrepreneurship in India emerged as the latest
consequence of EIC. The company injected various
changes in the Indian economy through export of Raw
materials and import of finished goods in India.
 The parsis established good rapport with the EIC to
establish manufacturing sector in India.
 At the time of 1st world war, the Indian Govt protected
certain companies stating that receiving benefits should
be registered in India with rupee capital.
Contd…
Entrepreneurship During Post- Independent:
The first Industrial policy1948- The Govt made
three important resolutions
1. To maintain a proper distribution of economic power
between private and public sector.
2. Encourage the Industrialization by spreading
entrepreneurship from existing centers to other cities,
towns, villages.
3. Distribute the entrepreneurship which concentrated in
a few dominant communities to a large number of
industrially potential people of varied social strata.
Contd…
Five year plan: 3rd five year plan- Govt
provided various incentives and concession in the form
of capital, technology, markets and land to the potential
entrepreneurs to establish Industries.
 e.g.: Some of the SML manufacturing units are TATA,
Birla, Kirloskar etc.
 DEVELOPMENT OF
ENTREPRENEURSHIP
Entrepreneurial development cycle consisting of
the following activities:
1. Stimulatory activities
2. Support activities
3. Sustaining activities
Stimulatory activities

Stimulatory activities: These activities ensure the emergence of

entrepreneurs in the society.
These can be achieved by the following activities:
 Entrepreneurial activities
 Planned publicity for entrepreneurial opportunities
 Identification of potential entrepreneurs through scientific
method
 Motivational training to new entrepreneurs
 Help and guidance in selecting and preparing projrct reports
 Making available techno-economic information and product
profiles
 Evolving locally suitable new products and processes
 Creating entrepreneurial forms
 Recognition of entrepreneurs
Support activities
Support activities: These activities help a person to
develop into an entrepreneur.
These can be achieved by the following activities:
 Registration of unit
 Arranging finance
 Providing land, shed, power, water and so on
 Supplying of scarce raw materials
 Getting licenses/import licenses
 Providing common facilities
 Granting tax relief or other subsidy
 Offering management consultancy services
 Help marketing the product
 Providing information
Sustaining activities

Sustaining activities: These activities are all those that help

in the continuous and efficient functioning of
entrepreneur.
These can be achieved by the following activities:
 Help modernization
 Help diversification/expansion/substitution production
 Additional financing for full capacity utilization
 Deferring repayment/ interest
 Diagnostic industrial extension/ consultancy services
 Production units legislation/policy change
 Product reservation/ creating new ways for marketing
 Quality testing and approving services
 Need based common facilities centers
 STAGES IN ENTREPRENEURIAL
PROCESS
First stage: Identifying and evaluate the
opportunity.
Second stage: Development of the business
plan.
Third stage: Determination of the required
resources.
Fourth stage: Management of the resource.
Development of the business plan
Titlepage
Table of contents
Executive summary
Major section:

1. Description of business
2. Description of industry
3. Technology plan
4. Marketing plan
5. Financial plan
6. Production plan
7. Organization plan
8. Operational plan
9. summary
Determination of the required resource
Determine resources needed
Determine existing resources
Identify resource gaps and available
suppliers
Develop access to those resources
Management of the resource
Develop management style
Identify problems and potential problems
Implement control system
Develop growth strategy
Identifying and evaluate the opportunity

Opportunity assessment
Creation and length of opportunity
Risk and returns of opportunity
Skills and goals
Competitive environment
THE ENTREPRENEURIAL CULTURE
Example:
Employees at Google enjoy a creative,
relaxed and innovative culture. The open
plan offices, informal structure and
entrepreneurial culture help to create a fun
working environment.
Entrepreneurial culture
Entrepreneurial culture implies a set of
values, norms and traits that are
conducive to the growth of
entrepreneurship.
e.g.: No entrepreneur can overlook the
country’s cultural heritage and values if
he wants to survive and progress.
Culture
Culture, Is a "The collective programming of
the mind which distinguishes the members of
one human group from another.
Culture underlies all components of work
environment that support entrepreneurship.
Elements of an Entrepreneurial Culture:

 People and empowerment focused

 Value creation through innovation and change
 Attention to the basics
 Hands-on management
 Doing the right thing
 Freedom to grow and to fail
 Commitment and personal responsibility
 Emphasis on the future and a sense of urgency
Thank you