Entrepreneurship Module1

Introduction to Entrepreneurship(21SBM654)
Module 1
Entrepreneurial Perspectives
MEANING OF ENTREPRENEURSHIP
 Performing the activities of an entrepreneur is called as entrepreneurship. It is a

French word, which means to undertake. In this all the available resources like innovative
ideas capital labor and business intelligence is utilized in effective manner to produce
innovative products and services. It may also involve creation of new enterprise or
diversification in established enterprises due to available opportunities in the market.
 Entrepreneurship is an ability of an entrepreneur to develop and establish business
enterprise and perform all the functions involved the particular activity.
 Just like managers perform management, entrepreneurs perform entrepreneurship. It is a
process involving different activities to set up an enterprise.
 It starts with discovering of opportunities, designing a business plan, applying resources
and techniques, and finally implementing the ideas. Not only this it also involves
managing and controlling of various risks and uncertainties and turning it into a
successful business venture.
EVOLUTION OF ENTREPRENEURSHIP
 Trade – Nearly 20,000 years ago, entrepreneurship started with trade. Goods were
exchanged between humans for an overall benefit of tribe.
 Agricultural revolution – With time, people learned to domesticate plants and animals.
Group of people cultivate food and exchanged it with people who provided valuable
goods. New areas of specialization began to emerge such as Pottery, Carpentry, Wool-
making and Masonry.
 Expansion of trade routes – Cities started to appear from 2000 BCE. As population
increased, people developed an idea that they can earn profits by trading between cities
and cultures. Popular trade at that time was of salt, fruits, rice and paper making by
China.
 Invention of money – The key development in the history of entrepreneurship was shift
from barter system to currency. Paper money acted as medium of exchange and provided
a way to store value.
 Beginning of the marketplace – Larger marketplaces became more popular to cater
large population. Banking regulation became more advanced for small businesses and
entrepreneurs could purchase goods from abroad. Innovation, Mercantilism and
Explorers was on the rise at that time. Luca Pacioli formulated standardized principles to
keep track of a company’s accounts.
Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 1

 Machines and Industrial revolution – Shift from small scale to large scale production
gave rise to some of the world’s great entrepreneurs such as J. Morgan and John D.
Rockefeller.
 Modern Entrepreneurship – Now-a-days entrepreneurship serves as lifeblood of all
economies of the world. Entrepreneurs are encourages to innovate and are valued for
their contribution in the economy.
TYPES OF ENTREPRENEURS
Traditionally, entrepreneurship is categorized into four main types: small businesses, scalable
startups, large companies and social entrepreneurs. These models cover the fundamentals of
starting a business and focus more on the company itself, rather than the qualities of the
entrepreneur. However, just as the world continues to change, so do businesses. This means new
opportunities for risk-taking and innovative game changers to pave the way in diverse
entrepreneurial ways.
10 Most Common Types of Entrepreneurship
 Small businesses entrepreneurship

 Scalable startup entrepreneurship
 Intrapreneurship
 Large company entrepreneurship
 Imitative entrepreneurship
 Innovative entrepreneurship
 Buyer entrepreneurship
 Researcher entrepreneurship
 Hustler entrepreneurship
 Social entrepreneurship
1. Small business entrepreneurship
This type of entrepreneurship refers to any kind of small business that has been created by one
person, without the goal to expand or franchise. For example, if you were planning to open a nail
salon, a general store or a taco truck your goal would be to launch a single store. You’d likely
plan on hiring local employees or even family members to get your business off the ground and
would need to invest your resources directly into the business.
In this type of business, you only make a profit if your company does, meaning you need to be
very driven, responsible and committed to your vision. In 2020, there were 33.7 million small
businesses in the United States, accounting for 99.9% of companies, proving that small business
entrepreneurship is on the rise.

2. Scalable startup entrepreneurship
Rooted in the idea of changing the world, scalable startups focus on how to create a business
model that is both repeatable and scalable (more sales with more resources). From the get go,
this style of entrepreneurship begins with the hope of rapid expansion and big profit returns.
Many startups have a similar ‘garage to riches’ narrative, beginning with a simple idea that is
brought to life by the tenacity of entrepreneurs with the support of investors. Amazon, Google
and Apple are all examples of trailblazing startups that have changed the world.
3. Intrapreneurship
Unlike an entrepreneur, who is also the founder, designer and manager of a business, an
intrapreneur is a self-motivated, and action-oriented employee who thinks out of the box and
works as an entrepreneur within a company. Intrapreneurship is a way that companies can
support and encourage employees that have entrepreneurial spirit.
Shutterstock, for example, hosts an annual 24-hour hackathon which lets employees pursue
innovative ideas that will benefit the company. Another example of an intrapreneurial innovation
is Facebook’s ‘Like’ button which was also created in a similar hackathon event, which is now
an integral part of the brand.
4. Large company entrepreneurship
Large company entrepreneurship refers to companies like Disney, Google, Toyota, and
Microsoft who have finite life cycles, as in, they keep innovating and offering consumers new
products that are variants around their core product-line.
A distinguishing feature of this type of entrepreneurship is that it is not starting a new business,
rather creating new products or subsidiaries within an existing company, or acquiring smaller
businesses (like when Facebook bought Instagram and WhatsApp). More specifically, these
divisions are focused on reaching new markets, expanding the customer base and growing the
business - sometimes via new company sites.
5. Imitative entrepreneurship
Imitation is the best form of flattery, and an imitative entrepreneur (also referred to as an
adoptive entrepreneur) is one who copies what successful innovative entrepreneurs have
previously done, most often with lower financial risks and limited resources.
If you are using an imitative entrepreneurship style, in essence you are copying an idea but
finding ways to improve it. By taking note of others' mistakes and finding creative ways to make
a business better, you can become a lucrative entrepreneur.

6. Innovative entrepreneurship
Innovative entrepreneurs, as the name suggests, are constantly trying to come up with the next
big thing. If you have groundbreaking ideas of how to start a business or specific services and
products that can become business ventures, you might be an innovative entrepreneur.
As an innovator, you know you must always be aware of the current market conditions to find
original and creative ways to disrupt them. Innovation refers not only to product ideas but also
the ways in which business is conducted. Innovative entrepreneurship is all changing the status
quo and pushing boundaries.
7. Buyer entrepreneurship
A buyer entrepreneur purchases either a developing or well-established company and helps them
thrive.Unlike investors, a buyer entrepreneur is involved both financially and personally in the
business, remaining active and directly helping the investment to grow. It is not uncommon for
buyer entrepreneurs to hand off their leadership to someone else at some point, but they always
maintain an active part in the businesses they purchase.
8. Researcher entrepreneurship
Researcher entrepreneurs rely on facts, data and the belief that with the right preparation and
knowledge will be more likely to succeed. If this sounds like you, this is exactly what research
entrepreneurship is all about—a great business idea paired with academic research, and an
understanding of how to stretch limited resources to the max.
Take a look at Nobel Prize winner and physicist, Theodor Hänsch, a researcher entrepreneur who
co-founded MenloSystems, taking his winning optical frequency comb technology and using it
to make products for the market.
9. Hustler entrepreneurship
Don’t let the name throw you off, a hustler in business refers to a self-starter, a highly motivated
person who is driven to succeed. This type of entrepreneurship style grows directly from the
entrepreneur, who must be confident, fearless and have rigorous work ethic.
If you are the type of person who can sell anything to anyone, is always aware of the next big
thing and is able to recognize opportunities, you might just be a hustler after all.
10. Social Entrepreneurship
Social entrepreneurs are innovators whose main goal is to create products and services that both
benefit the world, and make money. Social entrepreneurship relates to nonprofit, for-profit, or
hybrid companies that are committed to social or environmental change. Some examples include

educational programs, microfinance institutions, and companies that provide banking services in
undeveloped countries.
ENTREPRENEURIAL COMPETENCY
Entrepreneurial competency is defined as the individual characteristics; entrepreneur is a person

who undertakes risk for gaining profit in the business venture.
According to BIRD,
 Entrepreneurial competencies are defined as underlying characteristic possessed by a

person which results in new ventures creation survival and/or growth.
They do not include knowledge but do include applied knowledge or the behavioral application
of knowledge that produces success. In addition, competencies do include skill, but only the
manifestation of skills that produce. Success finally competencies are not work motives, but do
include observable behaviors related to motives.
COMPETENCY REQUIREMENT FOR ENTREPRENEURS
Competency requirements make an entrepreneur successful. An entrepreneur should possess

certain core competencies to become a recognized person. They can be listed as,
1. SUPERINTENDENCE
He should have the capacity to assemble the means that production turn-out maximum go at
minimum cost and to supervise the work.
2. LEADERSHIP QUALITIES
A businessman or woman has be able to lead his or her staff members as well as other associates.
He or she must be able to guide others in caring out business and make a success of it.
3. DECISIVE
 A successful business man or woman has to be very decisive. He or she has to take many
decisions sometimes on the spur of the moment.
 Any vacillation (the inability to decide between different opinions or actions ) in
decisions could affect their business.
 They have to be every firm in their decisions. Also while taking decisions they must not
get influenced by others. They should be able to take decisions independently.
4. RISK-TAKING
 Business involves many risks which a business person must be not hesitating to take. Lot
of financial involvement is there and obviously one has to be careful with investments.

 Yet risks have to be taken in money matters as well. Sometimes a businessman may lose
out on his or her venture but when he or she make a success of it then he or she has must
to gain, both financially and from a personal satisfaction point of view.
5. CONFIDENT
Achieving success in business requires confidence. A businessman or business woman has to be

sure of him or herself reaching the set targets of success. It does not help self-image is enhanced
when one is confident.
6. WILINGNESS
A businessman or woman must be willing to undertake any matters concerning their business
venture. He or she must not hesitate for personal or other reasons. Willingness to extend a
helping hand is very essential.
7. ENTREPRISING
One has to be enterprising in order to achieve significant results in business. He or she has to
have the zeal to do things. A laid-back approach will not help.
8. INNOVATIVE
New ideas help make a business venture successful. A successful business man or woman must
be innovative and always strive for something better. New concepts must be formulated and new
ways of doing business must be thoughts of.
9. 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.
10. 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.
CAPACITY BUILDING FOR ENTREPRENEURSHIP
Here are the four key categories of capacity building leading to the development of successful
entrepreneurs.

Operational Capacity Building
Having a brilliant understanding of an industry and business at ground level builds operational
capacity. This of course involves working in a variety of business operations for a period of time
prior to diving into entrepreneurship. This is where you gain valuable insight into what makes
businesses tick. Understanding the dynamics on the floor, in the cubicles, in the field and out on
the road, gives you the perspective on how to lead, organize and plan for operations.
Management Capacity Building
Taking operational experience one more step, gaining management experience in a field or
business will be directly applicable to managing your own business. The valuable experience
you gain managing operations, resources and people will give you the applicable tools for your
own business. With a few years of management experience, you will gain management capacity
and an understanding of responsibilities and accountabilities at that level… all precursors to
managing your own company.
Financial Management Capacity Building
Through a combination of work experience and education, you need to be well-grounded and
versed in managing finances. You need to be able to accurately estimate and build financial
statements and to understand them. With gained skills, you will need to be able to analyze
financial statements, looking at trends and indicators and what those all mean to your business.
Financial reports provide key indicators and information on the business’ financial health…there
is a wealth of information in the financial statements. Other parties, partners and financial
institutions will be looking at you and your organization’s ability to manage finances.
Personal Capacity Building
Of extreme importance, if you don’t have some key personal, entrepreneurial traits you may be
closing up shop fast. Some people are born with strong traits while other behaviors can be
picked up along the development pathway. Demonstrating strong traits and behaviors such as
dedication, perseverance, ambition, determination, strong-will, openness, honesty, transparency,
fairness, etc may move you along the pathway to become a successful entrepreneur.
ENTREPRENEURIAL TRAINING
Training aimed at developing entrepreneurial competence in potential individuals is called

entrepreneurial training. Motivating probable entrepreneurs, assisting these individuals in
endeavor to do the appropriate activities and enterprises, improving their enterprise development
skills, and facilitating them to make economically and technically feasible project reports are the
main activities of entrepreneurial training programmes.

The different types of motivational inputs include the wide array of tests, role plays,
psychological games, goal-setting exercise and so on. Helping the individuals to have a better
understanding of their entrepreneurial personality, changing self-concept and values with the
help of self-study and creating the supportive entrepreneurial behavior are the main motives of
these inputs.
Objectives of Entrepreneurial Training:
The main objectives of entrepreneurial training are enlisted below:
1. To encourage the spirit of self-employment among entrepreneurs and develop small and
medium enterprises.
2. To encourage new venture establishment and expansion of the existing ones in rural areas
through designing special programmes.
3. To inculcate the entrepreneurial skills to potential entrepreneurs and help develop the
same in existing entrepreneurs.
4. To enable the entrepreneurs to define or redefine their business objectives and work
individually as well as in group for the realization of the same.
5. To make the entrepreneurs ready for unforeseen threats and risks associated with the
business.
6. To facilitate strategic decision making among entrepreneurs.
7. To inculcate team building and coordination skills for meeting the future demands.
8. To develop the communications skills among the potential entrepreneurs.
9. To make the potential entrepreneurs able to define the vision of their ventures and work
in coordination for the realization of the same.
10. To make the potential entrepreneurs able to analyse the environment around them and
take suitable decisions about the product.
Methods of Entrepreneurial Training :
The various methods of providing training to the entrepreneurs are as follows :
1) Lecture Method :
As the name suggests, lecture method involves providing information to the trainees orally. In
case of any doubt arising in the minds of trainees, clarification can be given spontaneously by the
instructors.
2) Written Instructional Method :
When the training contents are to be used in the future by the trainees, this method is used and it
is most popular in case of standardized production system.
3) Individual Instruction :

In this method, only one person is chosen for providing entrepreneurial training. When a tough
skill is to be imparted in the candidate, this type.of training becomes very useful.
4) Group Instruction :
When the training is to be provided to the group of different individuals, this method is adopted
particularly when these persons have to perform the same type of activities and similar
instructions are to be given to all the candidates.
5) Demonstration Method :
This method is mainly useful when the physical exposure is to be imparted by the trainer. In this
method, the main focus is on providing practical knowledge rather than theoretical knowledge.
6) Meetings :
This method of training mainly involves the group of people to discuss the different issues faced
by them. They share their views, ideas and different conclusions are drawn on the basis of
various alternatives and suggestions.
7) Conference :
This method is generally used for imparting knowledge regarding new ideas and techniques to
the trainees. Here, conferences are organised and experts from different fields are called to share
their knowledge and experiences useful for the trainees.
ENTREPRENEURIAL MOTIVATIONS
Entrepreneurs take major financial risks, work long hours and practically torture themselves
trying to stay afloat and build a business from the ground up. There are five main motivations
that drive most entrepreneurs:
1. Money
You can deny it all you want, but the vast majority of entrepreneurs get into the game at least
partially because of the potential to make lots and lots of money. Stories about entrepreneurial
geniuses like Richard Branson and Mark Zuckerberg make it seem possible for any enthusiastic
citizen with a good idea to become an overnight billionaire. This isn't exactly true, but any
dedicated entrepreneur with a good idea and great timing can make a lot more money than they
ever could in a traditional position. There's nothing wrong with pursuing money, but if the allure
of wealth is the only thing driving you, you risk becoming frustrated if you don't turn a profit in
the first few years.

2. Flexibility
Some entrepreneurs venture out on their own because they're tired of the demands of traditional
work. In a high-level position, the demands are exceptional -- working long hours, catering to the
whims of your bosses and clients, and being stuck in the same old rut of responsibilities. Being
your own boss in the world of entrepreneurship frees you from those restraints. You can work
your own hours, wherever you feel like working, and set your own goals and responsibilities.
Just be aware that entrepreneurship is extremely demanding, especially in the early stages of
growth, so working your own hours doesn't always mean working fewer hours or working under
less stress. In fact, many people find that they work harder, longer, and under tighter constraints
as entrepreneurs than they did as workers - but it's still rewarding.
3. Control
The desire for control drives many entrepreneurs who aspire to attain a leadership position.
When you're the boss of your own organization, you'll get to call all the shots, from who gets
hired and at what salary to what new strategic directions your business heads down.
Workers tired of their previous companies' poor performances, or those working under an inept
CEO, might be especially motivated by this factor. Once rooted in a business, entrepreneurs have
full control over every decision made under them. The flip side is, of course, the additional stress
and pressure that go along with that responsibility. You'll get the privilege of setting the course
for your business, but if that course fails, you'll have only yourself to blame.
4. Teamwork
Some people love working with others. They like the atmosphere of team-based creative problem
solving, the interactions between mutually respectful, intelligent people, and the thrill of
succeeding together. Some jobs offer direct supervisory or leadership roles, but there's nothing
like building your own team from scratch.
As an independent entrepreneur, you'll choose your strategic partners, your mentors, your core
team and even your first round of subsequent employee hires. That means you'll get to pick the
skill sets, talents and personalities you want to work with, and you'll never have to worry about
working on a team that you don't like or can't be productive with. In some ways, your company's
team will be like your family. Just remember that no family lives without occasional
disagreements.
5. Legacy
Some entrepreneurs aren't in it for the money or the experience as much as they're in it for a
lasting legacy. They might want to become the face of a brand and earn a taste of fame along the
way. They might want to leave behind something that appreciates them. They might even want
to pass the business on to a future generation. The point is, they want to create something

meaningful that's going to outlast them. This motivation is one of the strongest for entrepreneurs,
because it can't be achieved in any other application, and it lasts a lot longer than money or
experience.
MODELS FOR ENTREPRENEURIAL DEVELOPMENT
ENTREPRENEURSHIP DEVELOPMENT PROCESS
Entrepreneurship development is the process of enhancing the entrepreneurial knowledge and

skills via structured training programmes. It deals with the study of entrepreneurial behaviour,
dynamics of business, and its development and expansion.
The objectives of entrepreneurship development programmes are to increase the knowledge and
skill of existing entrepreneurs and encourage others to become one. Ultimately, it helps in
increasing the number of such individuals in an economy.
Entrepreneur development focuses on training individuals who are interested in commencing

their venture or expanding their existing one. Furthermore, it concentrates more on encouraging
innovation and evaluating the growth potential of an enterprise. This development process helps
new firms to perform better and achieve their goals and expand their businesses. As a result, the
economy of a nation also improves. Moreover, it enables entrepreneurs to develop and manage
their business better along with the financial insecurities associated with it. An increase in the
rate of development of entrepreneurship ventures alleviates the problem of unemployment in an
economy. Additionally, it decreases the issue of stagnation and increases competition in the
market. A process like this aims to develop the competence of an entrepreneur and his/her
venture. Therefore, it enhances entrepreneurial objectives and encourages more people to
become entrepreneurs.
Objectives of Entrepreneurship Development Programme
The objective of Entrepreneurship Development programme are listed down here
 To Develop Entrepreneurial qualities and habits among the upcoming youth via the help
of proper training and expert counselling.
 To search and identify the best existing and upcoming business ideas and opportunities.
Motivating and guiding various individuals for launching their own new businesses and
startups. Thus, becoming a contributor to the economy.

 To reach risk mitigation to the youth of the nation. Provide and conduct various
programmes to spread the idea of Entrepreneurship in rural areas and villages.
 To generate employment and self-employment with the help of Entrepreneurship and the
growth of small scale businesses.
 To inform about various schemes launched by various Government (central, state or
regional governmental bodies) and also about various taxes put on enterprises.
Entrepreneurship Development Process
Every entrepreneurship development process comprises several steps. Here are the vital steps of
building an effective development programme to help individuals –
1. Learning and researching the business idea

Once an idea is selected for a new business, the entrepreneur must do his own research
and gather all useful information about the business. All ideas may not be worth investing
enough money in them and so the entrepreneurs should do thorough research and gather
financial as well as operational data about the business.
2. Evaluating the business idea thoroughly

Before going ahead with the business idea, the entrepreneur must check the plan
thoroughly. There may be many aspects of the new business that has to be started and the
entrepreneur must be aware of all such angles of the business venture.
The following points may be considered while evaluating the business idea.
 Is the opportunity or idea worth investing in or not?
 What are the major requirements for this product?
 Is the business feasible based on its cost?
 What are the main competitive advantages of the business idea?
 How much is the capital that is required in the business while launching the
product or service? And where and how to get this capital?
 What are the associated risks inherent with the product or service? Such risks can
be ofmany types like Technical Economic, Social and Environmental Risks, etc.
 Whether the idea coincides with the company’s goals or not?
3. Creating a business plan

The third step in the entrepreneurship development process is to create a business plan
based on the idea. The entrepreneur must take enough care in creating the business plan
because it is the document that will be shown to potential investors and financial partners
as well as the potential partners of the firm. Time and effort are required to create a
business plan and therefore, the entrepreneurs must be prepared to spend time on it. The
business plan should contain all major elements of the business, i.e. vision, goals,
financial aspects, etc.

4. Finding the resources

The next step of the process is to find financial and human resources to go ahead with the
project. The entrepreneur must find potential investors and locate the locations where
funding will be available. The entrepreneur must check for the cheapest interest rates for
the investments and recruit the marketing as well as the HR team to run his business.
5. Framing the hierarchy model

The entrepreneur must frame the management and hierarchical structure of the business.
It is an important step because the entire support of the organization will be provided by
the management team. Moreover, the entire command structure will be followed by the
team to run the business.
6. Planning for the future

When all of the above-mentioned steps are followed and the business runs smoothly on
track, the entrepreneur must get ready for the expansion and enhancement of the
business. In this step, the entrepreneur must look for credible sources to avail loans to
expand the business lines and implement new structures along with the growth of the
company.
Entrepreneurship is the backbone of a growing economy and hence all economies around the
globe pay attention to inculcating a healthy entrepreneurial culture. In order to achieve success in
entrepreneurial ventures, the entrepreneurs must have rare skills such as motivation,
determination, life skills, and financial skills among others.
The success of an entrepreneurship venture depends on these factors and hence the entrepreneurs
must be trained as much as possible in growing and developing economies. Entrepreneurship is a
tough task but with proper guidance and training, many individuals can become successful
entrepreneurs. The requirements for this are time and training of the potential future stars in the
business.
Question bank

Module 2
Directing and Controlling
Definition:
Means issuance of orders and leading and motivating subordinates as they go about executing
orders Consists of the process and techniques utilized in issuing instructions and making certain
that operations are carried on as originally planned.
Is a vital in managerial function Is used to stimulate action by giving direction to his

subordinates through orders and also supervise their work to ensure that the plans and policies
achieve the desired actions and results.
To conclude direction is the process of utilizing the techniques in issuing instructions and
making certain that operations are carried out on as originally planned.

Requirements or principles of effective direction:
1) Harmony of objectives: The goals of its members must be in complete harmony with the goals
of an organization The manager must direct the subordinates in such a way that they that they
perceive their goals to be in harmony with enterprise objectives.For Example the company’s
profits may be associated with the employee’s gains by giving additional bonus or promotion.
2) Unity of Command: The subordinates must receive orders and instructions from one
supervisor only the violation of which may lead to conflicting orders, divided loyalties and
decreased personal responsibility for results.
3) Direct supervision: Every supervisor must maintain face-to-face contact with his subordinates
which boosts the morale of the employees, increases their loyalty and provides them with
feedback on how well they are doing.
4) Efficient Communication: Communication is an instrument of direction through which the

supervisor gives orders, allocates jobs and explains duties and ensures performance. Is a two way
process which enables the superior to know how his subordinates feel about the company and
how the company feels on a number of issues concerning them. In communication
comprehension is more important than the content.
5) Follow-through: Is an act of following through the whole performance of his subordinates to

keep check on their activities, help them in their cat and point out deficiencies if any and revise
their direction if required
Leadership Styles:
Three leadership styles widely used:
1) Traits approach
2) Behavioral approach
3) Contingency approach
Traits approach:
Trait is basically a character and deals with personal abilities and assumed to be God’s gift and
abilities are identified as mental and physical energy, emotional stability, knowledge of human
relations, empathy, objectivity, personal motivation, communication skills, teaching ability,
social skills, technical competence, friendliness and affection, integrity and faith, intelligence etc.

Traits approaches –
Trait theories argue that leaders share a number of common personality traits and characteristics,
and that leadership emerges from these traits.Early trait theories promoted the idea that
leadership is an innate, instinctive quality that you either have or don't have.Now we have moved
on from this approach, and we're learning more about what we can do as individuals to develop
leadership qualities within ourselves and others. Traits are external behaviours that emerge from
things going on within the leader's mind – and it's these internal beliefs and processes that are
important for effective leadership.
2 .Behavioral approach
Behavioral theories focus on how leaders behave. There are three types of leaders:
a. Autocratic leaders make decisions without consulting their teams. This is considered
appropriate when decisions genuinely need to be taken quickly, when there's no need for input,
and when team agreement isn't necessary for a successful outcome.
b. Democratic leaders allow the team to provide input before making a decision, although the
degree of input can vary from leader to leader. This type of style is important when team
agreement matters, but it can be quite difficult to manage when there are lots of different
perspectives and ideas.
c. Laissez-faire leaders don't interfere; they allow people within the team to make many of the
decisions. This works well when the team is highly capable and motivated, and when it doesn't
need close monitoring or supervision. However, this style can arise because the leader is lazy or
distracted, and, here, this approach can fail.
3. Contingency approach–
Situation influencing good leadership. The realization that there isn't one correct type of leader
led to theories that the best leadership style is contingent on, or depends on, the situation. These
theories try to predict which leadership style is best in which circumstance.

Order of priority of human needs begins with the person’s unsatisfied need at the lowest level-
identification of the need develops in the form of as goal which leads to the fulfillment of the
need to achieve the goal.
These needs are arranged in the form of a ladder of five successive categories as shown in the
figure above.
(i) Physiological needs: Arise of the basic physiology of life like the need for food,
water, air, etc which must be at least satisfied partially for continued survival.
(ii) Security needs: Needs to feel free from economic threat and physical harm which
need protection from arbitrary lay-off and dismissal, disaster and avoidance of the
unexpected.
(iii) Egoistic needs: are the needs which relate to respect and prestige the need for
dominance for example.
Can be classified as self-esteem and esteem from others. Self esteem is the need for worthiness
of oneself and the esteem is the necessity to think others that he is worthy
(iv) Self-fulfilment needs: are the needs to realize ones potential that is realizing one’s
own capabilities to the fullest-for accomplishing what one is capable of to the fullest.
example a musician must make music etc.
According to Maslow, people attempt satisfy their physical needs first. as long as the needs are
unsatisfied they dominate and after they become reasonably satisfied and progress to the next
level and so on.
Herzberg’s Two-factor theory:
Original study based on the research by Fredrick and Herzberg who interviewed 200 engineers
and accountants and were asked about the good times and bad times they think about their
jobs.Out of these interviews two factors emerged called the
I Maintenance factors
II Motivators or satisfiers.

I Maintenance factors (Factor 1)
1) Fair company polices and administration
2) A supervisor who knows the work
3) A good relationship with ones supervisor.
4) A good relationship with one’s peers.
5) A good relationship with ones subordinates
6) A fair salary
7) Job security
8) Personal life
9) Good working conditions
10) Status
II) Motivators or satisfiers (Factor 2)
1) Opportunity to accomplish something significant
2) Recognition for significant achievements
3) Chance for advancement
4) Opportunity to grow and develop on the job
5) Chance for increased responsibility
6) The job itself.
Some facts about the two factors:
1) Motivators are job centered
2) Maintenance factors are related working conditions and environmental conditions.

3) These two groups of factors are also known as intrinsic and extrinsic rewards.
4) These two sets of factors are unidirectional.
McClelland’s need for achievement theory:
According to McClelland there are three important needs
(i) The need for affiliation

(ii) the need for power
(iii) the need for achievement
(i)Need for affiliation: Reflects desire to interact socially with people Concerned about the
quality of an important personal relationship
(ii)The need for power: Person having high need for power tries to exercise the power and
authority Concerned with influencing others and winning arguments
(iii)The need for achievement :
Has three distinct characteristics
(a) Preference in setting moderately difficult b ut potentially achievable goals
(b) Doing most things himself rather than getting them done by others and willing to take
personal responsibility for his success or failure and does not want to hold responsible for it.
(c) Seeking situations where concrete feedback is possible.
4) Victor Vroom’s Expectancy theory:
Works under conditions of free choice where an ind ividual is motivated towards activity which
he is most capable of rendering and which he believes has the highest probability of leading to
his most preferred goal. The basic concepts of this theory are
1)First and second level outcomes:

Job related goals before an individual such as promotion, increase in salary, recognition, and
praise and so on are called second level outcomes. Each second level outcome can be associated
with a value called valence for each individual. The valence can be positive, negative or zero
Valence positive: individual wants to attain promotion
Valence negative: does not want to attain promotion
Valence zero: outcome towards which he is indifferent
Second level outcomes can be achieved in different ways: promotion by leaving the
organization ,by absenting himself to show dissatisfaction, by joining a pressure group, by
attending a training programme, by bribing somebody, by improving performance or by bribing
somebody and so on.
2)Instrumentality:
All first level outcomes have equal probability of leading the individual to the second level
outcome the individual has subjective estimates of these probabilities ranging from - 1 to +1
which are called instrumentalities. -1 indicates a belief that second level outcome is certain
without the first level outcome 0 indicates a belief that second level outcome is impossible
without first level outcome 1 indicates a belief that second level outcome is certain with first
level outcome
These instrumentalities are helpful in determining the valence of each first-level outcome The
valence of each first-level outcome is the summation of all products arrived by multiplying its
instrumentalities with the related valences of the second level outcomes.
3. Expectancy:
It is the probability estimate which joins the individual’s efforts to first level outcome
Expectancy values are always positive ranging from 0 to 1.
4. Motivation:
Motivation is the multiplicative function of the valence of each first- level outcome (V1) And
they believed expectancy (E) that given effort will be followed by a particular first level
outcome, That is M=f(V1*E)
5. Adams equity theory:
In this theory, Equity is defined as the ratio between The individual’s job inputs (such as effort,
skill, experience, education and seniority) to the job re wards (such as pay or promotion) it is
believed that the individuals motivation, performance and satisfaction will depend on his on his

or her subjective evaluation o f his or her effort/reward ratio and the effort/reward ratio of others
in similar situations.
6. Skinners behavior modification theory:
The theory developed by researches done by B.F Skinner. The theory is believed and based on
the behavior of the past circumstances which they have learnt that the certain behaviors
associated with pleasant outcomes and certain other behaviors are associated with unpleasant
outcomes. Example: Obedience to authority leads to praise and disobedience leads to
punishment.
The consequences that increase the frequency of a behavior are positive reinforcement (praise or
monitory rewards) or negative enforcement (A manager requiring all subordinates to attend early
morning meetings if the performance falls below a certain desired level of the organization.
Negatives of the above theory proposed: Avoids concern for the inner motivation of the
individual. Skinners behavior modification theory is criticized for two reasons
(i) Overemphasis of extrinsic rewards ignores the fact that people are better motivated by
intrinsic rewards.
(ii)The theory is unethical no manager has a right to manipulate and control his employees
behavior life.
Communication
Communication means Exchange of opinions, facts ideas or emotions by two or more persons.
The sum of all things what one does to create an understanding in the minds of others.
Is the process of passing information, correct understanding and with right Interpretation from
one person to another.
Nature of communication
1. It is two way traffic:
Messages, directions, opinions etc .are communicated downward from management to workers.
Likewise grievances, complaints, opinions, point of view etc. are communicated upward from
workers to management.
2. Communication is a pervasive function:
Communication is required not only in direction function but in all functions of management like
planning, organizing, staffing, directing, controlling

3. Communication is a continuous process:
Communication is a regular process just like blood circulation in a human body An organisation
cannot exist without communication.
4. Communication aims at developing mutual understanding and cooperative human

relationship towards the achievement of organisational objectives.
Purpose of communication
1. Flow of information
The relevant information must flow from top to bottom and vice versa. The staff at all levels
must be kept informed about the organizational objectives and other development taking place in
the organization.
2. Coordination
It is through communication the efforts of all the staff working in the organisation can be
coordinated for the accomplishment of the organisational goals.
3. Learning Management skills
The communication facilities flow of information, ideas, beliefs, advice, opinion, orders and
instructions etc. both ways which enable the managers and other supervisory staff to learn
managerial skills through experience of others.
4. Preparing people to accept change
The proper and effective communication is an important tool in the hands of management of any
organization to bring about overall change in the organizational policies, procedures and work
style and make staff to accept and respond positively.
5. Developing Good Human Relations
Management and workers and other staff exchange their ideas, thoughts and perceptions with
each other through communication. This helps to understand each other better. They realize the
difficulties faced by their colleagues at the workplace. This leads to promotion of good human
relation in the organization.
6. Ideas of Subordinates Encouraged:
The communication facilities inviting and encouraging the ideas from subordinates on certain
occasions on any task.this will develop creative thinking.

Importance of communication:
The importance of communication rose from the fact that earlier business was considered only a
technical and formal structure.
But by Hawthorne’s experiments it was realized that every organization requires structure is a
social system involving the interactions of the people working at different levels and proper
communication is required to the goals of the organization, organizations existence from the
birth to continuing.
1. Coordination of activities
 The manager explains to the employees the organizational goals modes of achieving it.
 This requires coordination b/w various employees and also departments
 Through communication top level interact lower level and all employees this interaction
helps in getting the commitment,cooperation and coordination of people.
2.Improves planning and decision making
 Source of information for planning

 Proper communication provide information to the manager i.e useful for decision
making.
 no decision could be taken in the absence of information.
 decision, solves any query, accurate information which comes through communication
only
3.Connect geographically dispersed employees.
 The internet, emails, mobiles, telephone, video conferencing etc

 Helps to create virtual teams
4. Increases managerial efficiency
 The manager conveys the target and issues instructions and allocates job to the
subordinates.
 All these aspects involves communication
 Thus communication is essential for the quick and effective performance of the manager
and entire organization.
5.Maintaining good public relationship
 Communicate with media on organization issues.

 Press release, press conference, open houses.

6. Means to motivate people
Through motivation superior try to analyze the need of subordinates.
If there is smooth flow of information b/w superior and subordinates then easy for superior to
recognise,which type of incentive will motivate his subordinate.
Coordination
Is the orderly synchronization or fitting together of the interdependent efforts of individuals to
attain a common goal.
For example in hospital the proper synchronization of the activities of the nurses, doctors, wards
attendants and lab technicians to give a good care to the patient.
Can be considered as an essential part of all managerial functions of planning, organizing,

directing and directing if the manger performs these functions efficiently and expertly
coordination is automatically generated and there remains no need for special coordination.
Coordination is required at every level of all managerial functions
In planning: performs his function of planning by coordination of the interrelating the plans of
various departments
In organizing: coordination is required in grouping and various activities to subordinates and in

creating departments
In directing: coordination is required to take effect of his particular action will have on other
departments and executives
In controlling: coordination is required manger evaluates operations and checks whether

performance is in conformity with the desired results.
Techniques of coordination:
The following are the important techniques of coordination

1)Rules procedures and policies:
Helps in coordinating the subunits in the performance of their Repetitive activities. Standard
policies, procedures and policies are laid down to cover all possible situations
If the breakdown of the above occurs more rules, regulations are required to be framed to take
care of the breakdown
2)Planning:
Ensures coordinated effort and targets of each department dovetail with the targets of all other
departments.
Example: fixing the targets of the10000 units of additional production and consequently the sales
requires the coordination of the two departments respectively to meet the demands and achieve
the target.
3)Hierarchy:
Is the simplest device of achieving coordination by hierarchy or chain of command By putting

together independent units under one boss some coordination among their activities is achieved.
Sometimes defective because makes individuals dependent upon, passive towards and
subordinates to the leader.
4)Direct contact:
Used to solve the problems created at the lower levels which affects the employees can be
resolved by formal informal contacts to prevent overloading to top executives.
5)Task force:
Temporary group made up of representatives from the same departments facing problems and
exists as long as the problems lasts and each participant returns to normal tasks once the solution
is reached
6)Committees:
Arise due the fact when certain decisions consistently become permanent. These groups are
labelled committees. This device greatly eases the rigidity of the hierarchical structure, promotes
effective communication and understanding, of ideas, encourages the acceptance of commitment
to policies and makes implantation more effective.
7)Induction:

Of a new employee is a social setting of his work is also a coordinating mechanism.
The device familiarizes the new employee with organizations rules and regulations dominant
norms and behaviour, values and beliefs and integrates his personal goals with organizational
goals.
8)Indoctrination:
Device commonly used in religious and military organizations is another coordinating device
which develops the desire to work together for a purpose. The major task of a leader being to
build an organization can be succeeded by the indoctrination and other means by converting the
neutral body into a committed body
9)Incentives:
Providing independent units with an incentive to collaborate such as profit sharing plan is
another mechanism.
10)Liaison departments :
Evolved to handle transactions and typically occurs between the sales and production
departments.
11)Workflow:
Workflow is the sequence of steps by which the organization acquires inputs and transforms
them into outputs and exports these to the environment which is largely shaped by the
technological, economic and social considerations and helps them in coordination.
Importance of Coordination
1) Unity in Diversity
Every large org has a large number of employees,each with and background view or
openions,activities.therefore there are diversity activities in an org.
However ,all these activities would not be highly effective in the absence of coordination.
2) Unity of direction
An org needs to integrate the efforts and skills of different employees in order to achieve
common objectives.coordination also eliminates duplication of work leading to cost efficient
operations.
3) Encouragement of team spirit

In an org,there exist many conflicts b/w employees,departments etc.coordination encourages

people and departments to work as one big team and achieve the common objectives of the org.
4) Functional differentiation
An org has many departments or sections performing different functions.All these functions are
important for achieving the overall goals of the organization.if all departments work in isolation
from the others then they might not work in tendem.therefore coordination is essential for
integrating the functions.
5) Optimum utilization of resources
Primarily,coordination ensures that employee do not engage in cross-purpose work since it

brings together the human and material resources of the org.therfore less wastage of resources.
6) Grow in size:
Large organization has large no.of employees.
They have different habits,behaviour and approaches in a particular situation.many time they
won’t work in harmony.hence coordination is important.
7) Specialization
one person specialization may be unknown by the other employee that leads to
misunderstanding.coordination playa a major role in bringing them together.
8) Empire building
refers to top level of organization.it is important to achieve coordination among top level and
subordinates.
CONTROLLING
Controlling consists of verifying whether everything occurs in conformities with the plans
adopted, instructions issued and principles established. Controlling ensures that there is effective
and efficient utilization of organizational resources so as to achieve the planned goals.
• Controlling is an important function of management
• It verifies that all the allotted tasks are being performed on time
• Controlling ensures that activities in an organization are performed as per the plans.

• Controlling also ensures that an organization’s resources are being used effectively and
efficiently for the achievement of predetermined goals.
• It is a function that brings back the management cycle back to the planning function.
Nature & Purpose of Control
 Control is an essential function of management
 Control is an ongoing process
 Control is forward – working because pas cannot be controlled
 Control involves measurement
 The essence of control is action
 Control is an integrated system
CONTROL PROCESS/STEPS IN CONTROLLING
The basic control process involves mainly these steps as shown in Figure
1) The Establishment of Standards:
Because plans are the yardsticks against which controls must be revised, it follows
logically that the first step in the control process would be to accomplish plans. Plans can be
considered as the criterion or the standards against which we compare the actual performance in
order to figure out the deviations.
2) Measurement of Performance:
The measurement of performance against standards should be on a forward looking basis

so that deviations may be detected in advance by appropriate actions. The degree of difficulty in
measuring various types of organizational performance, of course, is determined primarily by the
activity being measured.
For example, it is far more difficult to measure the performance of highway maintenance worker
than to measure the performance of a student enrolled in a college level management course.
3) Comparing Measured Performance to Stated Standards:
When managers have taken a measure of organizational performance, their next step in
controlling is to compare this measure against some standard. A standard is the level of activity
established to serve as a model for evaluating organizational performance. The performance

evaluated can be for the organization as a whole or for some individuals working within the
organization. In essence, standards are the yardsticks that determine whether organizational
performance is adequate or inadequate.
4) Taking Corrective Actions:
After actual performance has been measured compared with established performance
standards, the next step in the controlling process is to take corrective action, if
necessary.Corrective action is managerial activity aimed at bringing organizational performance
up to the level of performance standards. In other words, corrective action focuses on correcting
organizational mistakes that hinder organizational performance. Before taking any corrective
action, however, managers should make sure that the standards they are using were properly
established and that their measurements of organizational performance are valid and reliable.
5) Follow – ups
After taking corrective actions management must do follow up.Follow up is done to find
out whether corrective actions are taken properly.Its also to find out whether deviations and their
causes are removed.If follow up is done properly,the actual performance will be equal or better
than established standards.
METHODS OF ESTABLISHING CONTROL
Various methods are used by management for controlling the various deviations in the
organization. i)Traditional Techniques
1.Personal observation 2.statistical reports 3.Break even analysis 4.Budgetary Control
ii)Modern techniques 1.Return on investment 2.Responsibility accounting 3.Management audit

4.PERT
5. CPM
6. Management Information system 7.Internal audit
i)Traditional Techniques 1.Personal observation
personal observation enables the manager to collect first hand information
It also creates a psychological pressure on the employees to perform well as they are aware that
they are being observed personally on their job
under this technique,manager notes the actual performance of employee

Then the manager decides whose performance is weak and how to improve it.
However,it is a very time consuming exercise and cannot effectively be used in all kinds of jobs
2. Statistical Reports
Statistical analysis in the form of averages,percentages,ratios etc present useful information to

the managers regarding performance of the organization in various areas.
Such information is present in the form of charts,graphs,tables etc.enables the managers to read
them more easily.
It allows a comparision to be made with performance in previous periods and also with the
benchmarks.
3. Break Even Analysis
is a Technique used by managers to study the relationship b/w cost,volume,profits. It determines

the probable profit and losses at different levels of activity.
The sales volume at which there is no profit,no loss is known as breakeven point. Breakeven
point is determined by the intersection of total Revenue and Total cost curves. It is beyond this
point that the firm will start earning profits.
It is a useful technique for the managers as it helps in estimating profits at different levels of
activities.

4. Budgetary control
It is a Technique of managerial control in which all operations are planned in advance in the
form of budgets
The actual results are then compared with budgetary standards This comparision tells us what
necessary action is required.
Different types of budget are 1.Sales budget
2. Production budget
3. Research and development budget 4.Advertising budget
Modern Techniques 5.Return on investment
Ratios of net profit to the total investment employed in the business is termed as return on
investment,generally expressed as percentage.
ROI= Profit Total Investment.
Using this percentage of profit is identified.
if ROI is high then the financial performance of a business is good
It helps to compare its present performance with that of previous year’s performance and also
helps for inter-firm comparisions.
it also shows the areas where corrective actions are needed.
6. Responsibility accounting:
It is defined as the system of accounting under which each department head is made responsible
for the performance of his department.
each department is made a profit center.
i)Profit center- manager is responsible for both revenue and cost incurred ii)Investment center-
center is responsible not only for profit but also for investments Ex:small start-up company
7. Management audit
It is helpful in identifying the deficiencies in the performance of management functions and

suggesting possible improvements.

It helps the management to handle the operation effectively.
8. PERT(Program Evaluation and Review Techniques)
This was developed during 1957-58 for USA Navy.
A project is split into activities and all the activities are integrated in a highly logical sequence to
find the shortest time required to complete the entire project
PERT was created primarily to handle R&D projects.
9. Critical Path Method(CPM)
This concentrates mainly on cost rather than duration like PERT.
The use of both PERT and CPM has grown rapidly today in controlling time bound projects such
as repairing a weak bridge,construction of huge building This Technique also follows the
principles of PERT i.e.critical activities are identified.more importance is given to completion of
these critical activities.
10. Management Information System
In order to control the organization properly the management needs accurate computer based
information.They need information about the internal working of the organisation and also about
the external environment.
Information collected continously to identify problems and find out solutions.
MIS collects data,processes it and provides it to the managers so that appropriate corrective
action may be taken in case of deviations from standards.
11. Internal audit
is conducted by an internal auditor who is an employee of an organization. He makes an

independent appraisal of financial and other operations.

He identifies the defects and deviations and reports to the management.

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Introduction to Entrepreneurship(21SBM654)

 Performing the activities of an entrepreneur is called as entrepreneurship. It is a

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 1

10 Most Common Types of Entrepreneurship

 Small businesses entrepreneurship

1. Small business entrepreneurship

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 2

2. Scalable startup entrepreneurship

4. Large company entrepreneurship

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 3

10. Social Entrepreneurship

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 4

Entrepreneurial competency is defined as the individual characteristics; entrepreneur is a person

 Entrepreneurial competencies are defined as underlying characteristic possessed by a

COMPETENCY REQUIREMENT FOR ENTREPRENEURS

Competency requirements make an entrepreneur successful. An entrepreneur should possess

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 5

Achieving success in business requires confidence. A businessman or business woman has to be

10. CONCEPTUAL THINKING

CAPACITY BUILDING FOR ENTREPRENEURSHIP

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 6

Operational Capacity Building

Management Capacity Building

Financial Management Capacity Building

Personal Capacity Building

Training aimed at developing entrepreneurial competence in potential individuals is called

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 7

Objectives of Entrepreneurial Training:

The main objectives of entrepreneurial training are enlisted below:

Methods of Entrepreneurial Training :

The various methods of providing training to the entrepreneurs are as follows :

2) Written Instructional Method :

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 8

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 9

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 10

MODELS FOR ENTREPRENEURIAL DEVELOPMENT

ENTREPRENEURSHIP DEVELOPMENT PROCESS

Entrepreneurship development is the process of enhancing the entrepreneurial knowledge and

Entrepreneur development focuses on training individuals who are interested in commencing

Objectives of Entrepreneurship Development Programme

The objective of Entrepreneurship Development programme are listed down here

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 11

Entrepreneurship Development Process

1. Learning and researching the business idea

2. Evaluating the business idea thoroughly

3. Creating a business plan

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 12

4. Finding the resources

5. Framing the hierarchy model

6. Planning for the future

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 13

Is a vital in managerial function Is used to stimulate action by giving direction to his

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 14

Requirements or principles of effective direction:

4) Efficient Communication: Communication is an instrument of direction through which the

5) Follow-through: Is an act of following through the whole performance of his subordinates to

Three leadership styles widely used:

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 15

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 16

Herzberg’s Two-factor theory:

Varsha G B ,Asst. Prof, Dept of CSE,SUIET Page 17

I Maintenance factors (Factor 1)

1) Fair company polices and administration