ENTREPRENEURIAL MOTIVATION AND COMPETENCIES

Structure:
2.0 Introduction
2.1 Objectives
2.2 Entrepreneurial Motivation
2.2.1 Concept and Nature of Motivation
2.2.2 Needs Framework of Entrepreneurial Motivation
2.2.3 Maslow’s Need Hierarchy Model
2.2.4 Manifest Needs Theory
2.2.5Factors Motivating Entrepreneurs
2.3 Entrepreneurship Competencies
2.3.1 Concept of Competency
2.3.2 Elements of Entrepreneurial Competencies
2.3.3 Objectives of Entrepreneurial Competencies
2.3.4Types of Entrepreneurial Competencies
2.3.5Competencies Identified by EDI
2.4 Summary
2.5 Glossary
2.6 Multiple choice Questions
2.7 Short Answer Type Questions
2.8 Long Answer Type Questions
Case Study 2-1: Right Rails of Ravindra Bam
2.0 Introduction

You are already aware of the roles and functions that the entrepreneurs play in relation to the
process of economic development and in relation to the enterprise. Every role has a skill and
competency requirement.

For instance, for a teacher or a performing artist, it is the skill to communicate that plays a
decisive role in their effectiveness besides, of course, their knowledge. For a craftsman or an
artist, it is the creativity and skill in the chosen craft. Talking about entrepreneurship, you
need to have a knack for spotting business opportunities and creativity and innovation in
developing and delivering a product or service.

It is hoped that after reading this chapter you will actually see the potential of a career in
entrepreneurship, and experience a desire to start a venture of your own .At the same time
there might be certain inhibitions in your mind whether such a task is feasible, practical and
sustainable. For every task one needs certain competencies. In this chapter you would learn in
detail about the entrepreneurial competencies. Whereas competencies reinforce a person‘s
perception of feasibility of a career option, there also has to be the will and urge, a
‘perception of the desirability. ‘Is it not paradoxical that entrepreneurship has a key role to
play in economic development, yet there are very few who ever think of it as a career option?
And, it is not that they may be lacking in skills. What one often finds is the lack of
motivation. Competencies equip us with the know–how of entrepreneurial behaviour and
motivation provides answers to know-why of entrepreneurial behaviour.

2.1 Objectives

After reading this unit you would be able to:

 Describe what motivates an entrepreneur and develop your motivation to be an

entrepreneur.
 Explain various theories of motivation.
 Describing and developing the entrepreneurial competencies.
 Explaining the competencies identified by EDI.
 Assessing the entrepreneurial potential.
2.2 Entrepreneurial Motivation

It should be interesting for you to know that the word ‘motivation’ has its origin in the Latin
word ‘movere,’ meaning “to move”. Psychologically, it means an inner or environmental
stimulus to action, forces or the factors that are responsible for initiation, sustaining and
restraining behaviour.

You may be amazed to learn that different people engage in the same behaviour for different
reasons, in fact be more than a reason, a constellation of various influences, and that the
reasons for continuing the same behaviour may be different from the ones that triggered it off
the first place. In other words, motivations may be diverse, multiple and dynamic.

2.2.1 Concept and Nature of Motivation

According to Robert Dubin, “Motivation is the complex of forces starting and keeping a
person at work in an organisation. Motivation is something that moves the person to
action, and continues him in the course of action already initiated.”Motivation refers to
the way a person is enthused at work to intensify his desire and willingness to use his energy
for the achievement of organisational objectives. It is something that moves a person into
action and continues him in the course of action enthusiastically. The role of motivation is to
develop and intensify the desire in every member of the organisation to work effectively and
efficiently in his position.

Motivation is a psychological process. Motivation has close relationship with the behaviour
of human beings. It explains how and why the human behaviour is caused. McFarland
considers the terms used in his definition in a general sense “as forms of tension occurring
within individuals, with resulting behaviour aimed at reducing, eliminating or diverting the
tension. Understanding the needs and derives and their resulting tensions helps to explain and
predict human behaviour, ultimately providing a sound basis for managerial decisions and
action. “Thus, motivation is a term which applies to the entire class of urges, derives, desires,
needs and similar forces.

Fig 2.1: Motivation Model

Nature of Motivation

The features of motivation are as under:

(i) Internal Feeling- Motivation is an internal feeling of an individual. It cannot be

observed directly; we can observe an individual’s actions and then interpret his
behaviour in terms of underlying motives.

(ii) Complex Process- Motivation is a complex process. Individuals may differ in

their motivation even though they are performing the same type of job. For
example: if two men are engaged in cutting stones for constructing a temple, one
 may be motivated by the amount of wages he gets and the other by the satisfaction
he gets by performing his job.

(iii) Continuous Process- Motivation is a continuous process that produces goal

directed behaviour. The individual tries to find alternatives to satisfy his needs.

(iv) Dynamic Process- Needs and motives of an individual change from time to
time, even though he may continue to behave in the same way.

(v) Different from Satisfaction- Motivation implies a drive towards an outcome

while satisfaction involves outcomes already experienced. Satisfaction is the
contentment experienced when a want has been satisfied.

2.2.2 Needs Framework of Entrepreneurial Motivation

In common perception, entrepreneurs are after money and they engage in profit making.
True, profit-as understood in terms of the residual income of the owner after meeting all the
expenses incurred on the engagement and utilisation of other factors of production-is the
reward of entrepreneurship just as salary is to men and women in employment and
professional fees is to those in profession. So everybody works for money. But people
certainly don’t work for money alone. After all, money is required not for its own sake, but
for the sake of the needs of the person that it can fulfil. Money, thus, is not the need as such.
It is teleological (to put it more simply, distantly) related to the internally felt needs (such as
need for food) and socially acquired needs (such as status symbols). This leads to the needs
framework of studying entrepreneurial motivation. This framework serves the important
purpose of enabling us to understand what motivates an entrepreneur.
2.2.3 Maslow’s Need Hierarchy Model

Fig 2.3 Maslow’s Need Hierarchy Model

A.H. Maslow developed a conceptual framework for understanding human motivation which
has been widely acclaimed. He defined a person’s effectiveness as a function of matching
man’s opportunity with the appropriate position of hierarchy of needs. Maslow proposed that
human needs can be arranged in a particular order from the lower to the higher as shown in
Fig. above.

The needs hierarchy is as follows:

(i) Basic Psychological Needs- They are taken as the starting point of motivation
theory and relates to the survival and maintenance of human life.

(ii) Safety and Security Needs- After satisfying the psychological needs, people want
the assurance of maintaining a given economic level. They want job security,
security of source of income, provision for old age etc.

(iii) Social Needs- Man is social being. He is, therefore, interested in conversation,
sociability, exchange of feelings and grievances etc.
 (iv) Esteem and Status Needs- These needs embrace such things as self-confidence,
independence, knowledge and success. They are concerned with prestige and status
of the individual.

(v) Self-Fulfilment Needs- The final step under the need priority model is the need to
fulfil what a person considers to be his mission in life. It involves realising one’s
potentialities for continued self-development and for being creative in the broadest
sense of the word.

2.2.4 Manifest Needs Theory

Another motivational model stressing higher-level needs is that of David McClelland who
described people in terms of three needs: Power, Achievement and Affiliation.

These are discussed below:

(i) Need for Power – The need for power is expressed as a desire to influence others.
In relation to Maslow’s Hierarchy, power would fall somewhere between the
needs for esteem and self-actualisation. People with a need for power tend to
exhibit behaviours such as out-spoken, forceful, willing to engage in
confrontation, and a tendency to stand by their original position. They often are
persuasive speakers and demand a great deal from others. Management often
attracts people with a need for power because of the many opportunities it offers
to exercise and increase power.

(ii) Need for Achievement – The need for achievement would fall between the needs
for esteem and self-actualisation given by Maslow. This need is satisfied not by
the manifestations of success, which confer status, but with the process of carrying
work to its successful completion.

Individuals with a high need for achievement generally will take moderate risks,
like situations in which they can take personal responsibility for finding solutions
to problems, and want concrete feedback on their performance.
 (iii) Need for Affiliation – McClelland’s affiliative motive is similar to Maslow’s
social need. The person is concerned with forming friendly relations with others,
desire for companionship, desire to help others. People dominated by the
affilliative need would be attracted to jobs that allow considerable social
interactions. Managers of such individuals should create a climate that does not
constrain interpersonal relations. A manager could also facilitate their need
satisfaction by spending more time with such individuals and periodically
bringing them together as a group.

2.2.4 Factors Motivating Entrepreneurs

Internal Factors

i. Desire to work independently

ii. Occupational experience
iii. Technical/Trade/Qualification and knowledge

External Factors

i. Financial assistance from institutional sources.

ii. Accommodation in industrial estates.
iii. Machinery on hire purchase.
iv. Attitude of the government to help new units.
v. Financial assistance from non-government sources.
vi. Encouragement from big business.
vii. Heavy demand.
viii. Profit margin.
ix. Unsound units available at cheap price.
2.3 Entrepreneurship Competencies

As noted in the introduction, every career draws on the competencies of an individual. Some
of these competencies may be general and some peculiar to the chosen career. You may
understand competencies to mean abilities and skills. However, we would desist from calling
these personality traits as such a conceptualization only reinforces the mistaken belief that
entrepreneurs are born rather than made. We believe that recognition of these competencies
as abilities and skills makes entrepreneurship as a teachable and learnable behaviour. In this
section we orient you towards a set of entrepreneurial competencies developed by the
Entrepreneurship Development Institute of India (EDI) Ahmedabad. These competencies
were identified by a thorough research procedure based on critical analysis of the case studies
of the successful entrepreneurs.

2.3.1 Concept of Competency

A competency may be defined as an underlying characteristic of a person which results in

effective performance of a job. It may include such motive, traits, skills, aspect of one’s self-
image or a body of knowledge which one uses in the practical life .the success of an
entrepreneur is determined by entrepreneurial competencies. If he has such competencies, he
can be expected to achieve his goals.

Whenever we look around, we find certain entrepreneurs doing exceedingly well. They are
managing their enterprises very well and are out to make them grand success. The various
question that normally arise are –who are they? What do they possess? What leadership style
do they follow? And so on. In fact, there is a judicious mixture of knowledge, skills and
personality traits. All these are called entrepreneurial competencies. Knowledge refers to the
collection and retention of information about any job or activity. Knowledge forms the basis
for action. Only knowledge cannot ensure success. Success depends upon the ability or skill
of using the acquired knowledge. Thus, performance depends upon both knowledge and
skills. The personality represents the ‘whole person’ concept. It includes perception, learning
and motivation.

2.3.2 Elements of Entrepreneurial Competencies

The essential elements of entrepreneurial competencies are as follows:

 1. Knowledge
2. Skills
3. Motives and traits

Knowledge
Innovation is possible only through knowledge .in simple words, knowledge means collection
of information and retention of facts that an individual stores in some parts of the brain.
Creative process provides imagination, germinates ideas, nurtures them and develops them
successfully. But innovation is the development process which translates an idea into an
application. it requires persistence in analytical working out the details of product design or
service , and to develop marketing , obtain finances and plan operations.

Skills
Skill is the ability to demonstrate a system and sequence of behaviours that are functionally
related to attaining a goal. An entrepreneur is required to have certain skills which are as
follows:

(a) Anticipatory skills- foresight into a constantly changing environment.

(b) Visioning skills –inducing a group to act in accordance with the leader’s purposes
or the shared purposes of a larger group.

(c) Value congruence skills- the need to be in touch with employee’s

economic ,safety ,psychological, spiritual sexual, aesthetic and physical needs in
order to engage people on the basis of shared motives, value and goals.

(d) Empowerment skills – The willingness to share power and to do so effectively.

 (e) Self-understanding skills- introspective or self-knowledge skills as well as
framework within which leaders understand both their own needs and goals and
those and those of their employees.
Motives And Traits

Motives deal with recurrent concern for a goal, state or condition appearing in fantasy which
drives, directs and selects behaviour of the individual. In simple words, motive represents
thoughts related to a particular goals or state. McClelland opined that “need for achievement”
is a motive to excel that trend to characterize successful entrepreneurs especially when
reinforced by cultural factors

Trait may be defined as disposition or characteristic way in which a person responds to a set
of stimuli. Such responses represent intelligence, charisma, decisiveness, enthusiasm,
strength, bravery, integrity and self-confidence. Thus, traits are an individual’s personal
characteristics. An entrepreneur provides leadership to his enterprise and so he must possess
the leadership traits he should be:

(i) Adaptable to situations faced,

(ii) Alert to social environments,
(iii) Ambitious and achievements oriented,
(iv) Assertive,
(v) Cooperative,
(vi) Decisive,
(vii) Dominant,
(viii) Energetic,
(ix) Self- confident,
(x) Tolerant of stress.
2.3.3 Objectives of Entrepreneurial Competencies

1. Integrity - The entrepreneur has a clear sense of values and beliefs that underpin the
creative and business decisions that they make; and that influence the actions they take,
particularly when in difficult or challenging circumstances.

2. Conceptual Thinking - The entrepreneur is prepared to use fresh approaches; comes up

with crazy ideas that may just work, leading to radical change or significant improvements;
and takes time to listen to new ideas without pre-judgment.

3. Risk taking - The entrepreneur understands that risk taking means trying something new,
and possibly better, in the sense of stretching beyond what has been done in the past; and that
the constant challenge is to learn how to assess choices responsibly, weighing the possible
outcomes against his/her values and responsibilities.

4. Networking - The entrepreneur understands that networking is a key businessactivity

which can provide access to information, expertise, collaboration and sales; and that careful
planning and preparation helps achieve desired results.

5. Strategic Thinking - the entrepreneur understands and values the planning process,
thinking and planning over a significant timescale; recognises external trends and
opportunities; and is able to think through any complex implications for the business.

6. Commercial Aptitude - the entrepreneur keeps up to date with developments in the

sector; seeks out best practice; and identifies and seizes opportunities that are not obvious to
others.

7. Decisiveness - the entrepreneur resolves issues as they arise; does not get bogged down in
analysis during decision making; and responds flexibly to deal with changing priorities.
8. Optimism - the entrepreneur persists in pursuing goals despite obstacles and setbacks;
operates from hope of success rather than from fear of failure; and sees setbacks as due to
manageable circumstance rather than a personal flaw.

9. Customer Sensitivity - the entrepreneur builds trust and long term relationships with
customers; generates an expectation of high level of customer service; and regularly exceeds
customer expectation.

10. People Focus - the entrepreneur creates common purpose with colleagues through shared
vision and values; walks the talk; sees and values the best in others; builds the total capability
of the immediate and wider team; and always considers the principles of inclusiveness in
planning and dealing with others.

2.3.4 Types of Entrepreneurial Competencies

Entrepreneurial competencies can broadly be classified under the following categories:

1. Behavioural competencies
2. Enterprise launching competencies
3. Enterprise management competencies

In fact, there is no clear-cut demarcation between these set of competencies. They

intermingle with each other.

1. Behavioural competencies

Behavioural competencies relate to the type of behaviour exhibited by the entrepreneur in

performing various task in the discharge of this functions. These behavioural competencies
cut across all types of enterprise, their size, their location, their economic and economic and
social dimension etc. therefore, one may say that these are fundamental to all types of
enterprise and therefore to all types of that these are fundamental to all types of enterprise and
therefore to all types of entrepreneurs.

The behavioural competencies include:

(i) Initiative: The entrepreneur should be able to take actions that go beyond his job
requirements and to act faster. He is always ahead of others and able to become a
leader in the field of business.
Examples

 Does things before being asked or compelled by the situation.

 Acts to extend the business into new areas, products or services

(ii) Persistence: An entrepreneur is able to make repeated efforts or to take different

actions to overcome an obstacle that get in the way of reaching goals.
Examples

 Takes repeated or different actions to overcome an obstacle

 Takes action in the face of a significant obstacle

(iii) Information Seeking: An entrepreneur is able to take action on how to seek

information to help achieve business objectives or clarify business problems.
Examples

 Does personal research on how to provide a product or service

 Consults experts or experienced persons to get relevant information
 Seeks information or asks questions to clarify a client's or a supplier's
need
 Personally undertakes market research, analysis or investigation
 Uses contacts or information networks to obtain useful information

(iv) Concern for High Quality of Work: An entrepreneur acts to do things that meet
certain standards of excellence which gives him greater satisfaction.
  Examples
  States a desire to produce or sell a top or better quality product or
service
 Compares own work or own company's work favorably to that of
others

(v) Systematic Planning:An entrepreneur develops and uses logical, step-by-step

plans to reach goals.
  Examples

 Plans by breaking a large task down into sub-tasks

 Develops plans that anticipate obstacles
 Evaluate alternatives
 Takes a logical and systematic approach to activities

(vi) Problem Solving: Successful entrepreneur identifies new and potentially unique
ideas to achieve his goals.
  Example

 Switches to an alternative strategy to reach a goal

 Generates new ideas or innovative solutions

(vii) Self-Confidence: A successful entrepreneur has a strong belief in self and own
abilities.
  Examples

 Expresses confidence in own ability to complete a task or meet a

challenge
 Sticks with own judgment in the face of opposition or early lack of
success

(viii) Use of Influence Strategies: An entrepreneur is able to make use of influential

people to reach his business goals.
  Examples

 Acts to develop business contracts

 Uses influential people as agents to accomplish own objectives
 Selectively limits the information given to others
 Uses a strategy to influence or persuade others

(ix) Persuasion: An entrepreneur can successfully persuade or influence others for

mobilizing resources, obtaining inputs, organizing productions and selling his
products or services.
  Examples

 Convinces someone to buy a product or service

 Convinces someone to provide financing
 Convinces someone to do something else that he would like that
person to do
 Asserts own competence, reliability, or other personal or company
qualities
 Asserts strong confidence in own company's products or services

2. Enterprise launching competencies

Opportunities exist in the environment but not all of us are sensitive to them. Similarly,
resources are available to all member of society, but very few make efforts to ensure best use
of these resources. Beside economic insight for sensing opportunities in the area, prospective
entrepreneurs may have to develop the capability of selecting a suitable project, formulating
project reports, arranging the plant machinery etc. they should also identify and avail the
facilities and resources needed to lunch their enterprises.

3. Enterprise management competencies

Various managerial functions such as purchasing, marketing, finance etc. are crucial for the
entrepreneur. Their efficient performance is an important determinant of the success and
sustenance of an enterprise. Management skills of potential entrepreneurs also raise their
result expectancy. Although the extent of management skills required will vary as per the size
of the enterprise the management competencies in the areas like production management,
financial management, marketing management, industrial relations and personal management
, growth and development, etc. are minimum basic reqirements

2.3.5 Entrepreneurial Competencies Identified By EDI

(i) Initiative: Acting out of choice rather than compulsion, taking the lead rather than waiting
for others to start.

(ii) Sees and Acts on opportunities: A mind-set where one is trained to look for business
opportunities from everyday experiences.

(iii) Persistence: A ‘never say die’ attitude, not giving up easily, striving information seeking
continuously until success is achieved.

(iv) Knowing: Knowing who knows, consulting experts, reading relevant material and an
overall openness to ideas and information.

(v) Concern for High Quality of work: Attention to details and observance of established
standards and norms.

(vi) Commitment to Work Contract: Taking personal pains to complete task as scheduled.

(vii) Efficiency Orientation: Concern for conservation of time, money and effort.

(viii) Systematic Planning: Breaking up the complex whole into parts, close examination of
the parts and inferring about the whole.

(ix) Problem Solving: Observing the symptoms, diagnosing and curing.

(x) Self- confidence: Not being afraid of the risks associated with business and relying on
one’s capabilities to successfully manage these.

(xi) Assertiveness: Conveying emphatically one’s vision and convincing others of its value.

(xii) Persuasion: Eliciting support of others in the venture.

(xiii) Use of Influence Strategies: Providing leadership.

(xiv) Monitoring: Ensuring the progress of the venture as planned.

(xv) Concern for employees welfare: Believing in employee well-being as the key to
competitiveness and success and initiating programmes of employee welfare.

2.4 Summary

To take up a career in entrepreneurship you have to feel the desire as well asperceive the
feasibility of entrepreneurship as a career option. Fortunately it is no longer believed that
entrepreneurs are born with certain traits. The emphasis is now on the competencies, which
provide the know-how of how to engage in entrepreneurial behaviour. Knowledge, skills and
abilities for undertaking a particular task can be learnt. A list of general competencies, which
play an important role in entrepreneurial success includes work commitment self-confidence,
systematic planning, concern for quality etc. A change in perspective- an ability to perceive
opportunities and to think of innovative ways of exploiting opportunities is a right step in
thinking like an entrepreneur. Experience in that particular field will go a long way in
providing you the know-how and confidence that you can launch and successfully run an
enterprise. Many motivators for taking the plunge into entrepreneurship have been identified
by McClelland among others. Of these the Need for Achievement plays a very crucial role in
entrepreneurial motivation. It encompasses defining a problem, organizing the means of
solving it, setting goals, seeking challenges and taking moderate risks. Desire for autonomy
also spurs people to start their own ventures, as they do not want to work as subordinates who
have to follow instructions all the time. You will learn about these in the subsequent lessons.
2.5 Glossary

1. Competence – The ability to do something successfully or efficiently.

2. Entrepreneur –A person who sets up a business or businesses, taking on financial

risks in the hope of profits.

3. Entrepreneurship – Is the process of discovering new ways of combining resources.

4. Manifest Needs – The need pattern evident from one’s behaviour.

2.6 Multiple Choice Questions

1. The energizing force that activates behaviour and provides purpose and
direction to that behaviour is known as _____.
A) Motivation
B) Personality
C) Emotion
D) Perception
E) Needs

2. Which term is often used interchangeably with the term “motivation”?

A) Personality
B) Emotion
C) Need
D) Perception
E) Feeling

3. Which step in Maslow’s Hierarchy of Needs Theory deals with achieving one’s
potential?
A) Self-actualisation
B) Physiological
C) Esteem
D) Safety
E) Social

4. Who proposed that achievement, affiliation and power are three important needs
that help explain motivation in workplace situations?
A) McGregor
B) Aldermen
C) Herzberg
D) McClelland
E) Maslow

5. An individual’s belief that he or she is capable of performing a task is called?

A) Self-importance
B) Self-esteem
C) Self-actualisation
D) Self-worth
E) Self- efficiency

6. The word competency may include 3 elements except?

A) Knowledge
B) Need
C) Motives and Traits
D) Skills

7. Entrepreneurial competency is broadly classified under following categories

except?
A) Enterprise launching competencies
B) Persuasion Competencies
C) Behavioural competencies
D) Enterprise management competencies

8. Arrange the following five levels of Maslow’s Need Hierarchy Model Starting from
bottom to top:

A) Esteem Needs
B) Biological and Physiological Needs
C) Safety Needs
D) Self- Actualization Needs
E) Belongingness and Love Needs

9. Which one of the following is not included in Manifests Need Theory?

A) Need for Affirmation
B) Need for Power
C) Need for Affiliation
D) Need for Achievement

10. Which of the following is NOT considered as the feature of Motivation?

A) Internal Feeling
B) Complex & Continuous Process
C) Dynamic Process
D) External Feeling

11. Which of the following factor/factors motivate Entrepreneur?

A) Encouragement from Big businesses
B) Desire to work independently
C) Location factors
D) Attitude of government to help new units

12. Which of the following issues about the need theories of motivation have the
 most unclear ethical guidelines?
A) Creating work environments & work experiences that let people satisfy their needs.
B) Managing multinational operations according to the needs of people in the host
culture.
C) Managing multinational operations as if they were in their home culture.
D) Manager’s affecting people’s behaviour from knowledge of human motivation
without their informed consent.

13. Motivation:
A) is an external process
B) is innate
C) is an internal process
D) resides only in students who are paying attention

14. A reward that is external to the activity, such as recognition or a good grade, is
called:
A) An extrinsic incentive
B) A primary reinforce
C) An internal drive state
D) An intrinsic incentive

15. Competencies are:

A) The abilities and skills
B) Only Skills
C) Only Abilities
D) The strengths & weaknesses
2.7 Short Answer Type Questions:
1. Define motivation.
2. Explain motivation model in brief.
3. Why motivation is considered a continuous process?
2.8 Long Answer Type Questions:
1. Discuss Maslow’s Need Hierarchy Model.
2. Explain Needs Manifest Theory of David McClelland.
3. What are the various factors that affect the motivation of entrepreneurs?
4. Define entrepreneurial competencies and its various elements.
5. What are the various entrepreneurial competencies identified by EDI? Explain.
Case Study 2-1: Right Rails of Ravindra Bam
He claims to have saved over 25000 trees in eight years. Ravindra Bam has achieved this by
selling his ‘Decorail’ curtain carrier systems to people who would otherwise have got
pelmets. An arts graduate, Bam worked in banks for 16 years and as an administration
manager for a Muscat-based construction company for another six before deciding to return
home and set up his own business. “My wife and I used to collect any new thing we saw
while we were in the Gulf,” he recalls. “ we saw this product there and decided to
manufacture in India.”
Active in the Students’ Federation of India while at college, Bam still believes in creating
employment in rural areas. So after coming back to Pune in 1986 and surveying the market
for two and a half years, he searched for a place where there was no industry and bought land.
All his 40 enployees today are locals and in this project to make curtain rods, tape and hooks,
lack of knowledge of either textiles or engineering proved to be a plus point. “ I might not
have ventured into it had I been an engineer”, he says.
Today, Bam’s Ajay Windecor products makes and exports a range of rope operated drapery
systems besides the orginal Decorail. All of them, except Fast Track which was developed for
heavy-duty use in hotels, hospitals and public places, are telescopic: there are four basic
sizes, which provide rust-resistent, powder-coated rods.
In developing a dealer network, Bam did not want established businessmen. Most of his 150
dealers today are prople who started with Decorail. About 30 of them are women and the
others involve their families in business, because he insists that every dealer must also offer a
curtain stitching service. Along the way, he set up three centers to train his dealers’ wives and
family members for this purpose.
Obviously, the dealers are happy: each sells about 100 units a month, earning between Rs.
1000 and Rs 15000 from commission, cloth and stitching and fitting charges.
Bam insists he has no competition because he keeps his products at least 25 % cheaper than
other systems. Sales have grown 20 percent a year sinch Decorail entered the market in 1991.
It is the only company from Pune besides Telco and Bajaj Auto to advertise on national
television with a monthly adspend of Rs. 2 lakhs; but Bam prefers to participate in
exhibitions catering to middle-class people rather than those held in five-star hotels. The
strategy works: “ Today, people ask for even ordinary curtain rods as Decorail” he adds. So
will Decorail soon become generic for curtain rods?
Questions:
1. What factors in your opinion helped Ravindra Bam make his brand virtually a generic
name in curtain systems?
2. List the major entrepreneurial competencies you find in Ravindra Bam.