Module-I Basic Concepts Entrepreneurship Development
The word „entrepreneur‟ is derived from the French word enterprendre. It means “ to undertake.” • The term “entrepreneur” was applied to business initially by the French economist, Cantillon, in the 18th century, to designate a dealer who purchases the means of production for combining them into marketable products.
• An individual who bears the risk of operating a business in the face of uncertainity about the future conditions. • An entrepreneur is a person who has possession of an enterprise, or venture, and assumes significant accountability for the inherent risks and the outcome. It is an ambitious leader who combines land, labor, and capital to often create and market new goods or services.
Entrepreneur as one who always searches for change, respond to it and exploits it as an opportunity . Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or services.
• An entrepreneur is an economic man who tries to maximise his profits by innovations. • Innovations involve problem- solving and the entrepreneurs gets satisfaction from using his capabilities in attacking problems.
Financial Reasons To Start A Business
Loss of Job Or Change Of Employment
More Income For Necessities Second Income Bridge A Gap Till Retirement
Forced Into Early Retirement Don't Know Or Not Stated
Non-Financial Reasons To Start A Business
9% 7% 9% 41%
Do Something I Love More Flexibility Be Key Decision Maker Change Lifestyle Spend More Time With Family Don't Know or Not Stated
Some Latest Terms
• Not every person who starts a business has the mission of making a lot of money and growing it to a worldclass business. • Some just want a simple balanced lifestyle while doing the kind of work they enjoy doing. such business owners are“Micropreneurs”
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A person within a large corporation who takes direct responsibility for turning an idea into a profitable finished product through assertive risk taking and innovation.
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Advantages of Intrapreneurship Intapreneuring is an excellent opportunity for creative employees with entrepreneurial spirit. and a sense of belonging to their company. management qualities. Employee don’t have to leave his company to fulfill his entrepreneurial dream
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• “Technopreneur” is coined just a couple of years back refer to Technology Entrepreneur. • A Technopreneur has two major characteristics: 1. or using. technology.He is comfortable working with.He does things NOT for profits but he innovate something because he wants to innovate. 2.
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they are inbuilt traits with which a person must be born. 3. All you need is money to be an entrepreneur: • A venture needs capital to survive & it is true that a large number of business failure occur because of lack of adequate financing. 2.Myths About Entrepreneurs
1. Entrepreneurs are born. not made : • Entrepreneurs cannot be taught or learned. All you need is luck to be an entrepreneur: Being in “the right place at the right time “ is always an advantage but “luck happens when preparation meets opportunity “
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Skills of Successful Entrepreneurs
– The ability to manage many different types of jobs and responsibilities at the same time.
– The ability to examine important facts about the business and to determine the least risky way to proceed
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– The ability to obtain all the necessary information to insure that the best possible decisions are made.Skills of Successful Entrepreneurs
– The ability to organize all the resources of the business in order to make it run in the most efficient manner.
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Design and Default • Triggered by „Social Disruption or Interruption” • Entrepreneurs are created in good and bad economic times. • Many begins but few make it.
. • Achievements and Financial Rewards for an Entrepreneur.HOW PEOPLE BECOME AN ENTREPRENEUR?
• By Necessity and Opportunity.
• It also includes the ability to build an entrepreneurial or venture team to complement your (the entrepreneur) own skills and talents.
• It requires a willingness to take calculated risks – both personal and financial. and then to do everything possible to reduce the chances of failure.
.ENTREPRENEUR Vs ENTREPRENEURSHIP Entrepreneurs People who create and grow enterprises Entrepreneurship Process through which entrepreneurs create and grow businesses. Opportunity idea translation creativity.
Economic development of the region. Proper utilization of human potentiality.
. Eradication of regional imbalances. Better economic gain.WHY ENTREPRENEURSHIP
To reduce backwardness of the people. Special attention to take up new activities. To create self-employment and generation of employment opportunity.
Characteristics of Successful Entrepreneur
creativity and innovation
Motivation to succeed
Problem solver Dynamism
Spot and take advantage of opportunities
.Characteristics of Successful Entrepreneur
Determination & Persistence Vision.
How to be a successful Entrepreneur?
an Entrepreneur should have some basic qualities in his personality.”
.“To be a Successful Entrepreneur.
Entrepreneur should be:
Self-confident and optimistic Able to take calculated risk Respond positively to changes Flexible and able to adapt Knowledgeable of markets Able to get along well with others
Energetic and diligent Creative. need to achieve Dynamic Leader
Responsive to suggestions
Take initiatives Resourceful and persevering Perceptive with foresight
Kindsthe type of business of entrepreneurs According to
1 Business entrepreneur 2 Trading entrepreneur 3 Service entrepreneur • According to the use of technology 1 Technical entrepreneur 2 Non-technical entrepreneur • According to the area 1 Urban entrepreneur 2 Rural entrepreneur
Kinds of entrepreneurs
• According to gender 1 Men entrepreneur 2 Woman entrepreneur • According to the sales of operation 1 Small scale entrepreneur 2 large scale entrepreneur • Others 1 Innovative entrepreneur 2 Imitating entrepreneur 3 Drone entrepreneur
TYPES OF ENTREPRENUERS
. discovers new markets. They focus on revolutionalisation and development. establishes new methods of production and restructures the enterprise. Can work only when definite level of progress has been previously accomplished.INNOVATIVE ENTREPRENEURS
Launches new products.
Suitable for underdeveloped countries.IMITATIVE ENTREPRENEURS Adopt victorious innovations launched by the innovative entrepreneurs. Duplicate the technology and techniques innovated by others. He is more an organizer of factor of production than a creator.
Exemplified by great caution and skepticism in experimenting any change in the organization. Their dealings are determined by customs. religion. tradition and past practices.
. Such entrepreneurs are shy and lazy. They imitate only in situations where it becomes necessary to do so.
They are laggards because they continue in their traditional way.DRONE ENTREPRENEURS
Drone Entrepreneurs suffer losses. as they refuse to make any modifications in the existing production methods.
Development of Industries in Rural areas Self-employment
Employment for Others
More goods & Services available Promotion of the Use of Modern Technology
Development of Entrepreneurial Qualities & Attitudes
Encourage more researches Studies
Pandit Jawaharlal Nehru says…. the village moves and the Nation moves
When women move forward. the family moves.
• “ AN ENTERPRISE OWNED AND CONTROLLED BY A WOMAN HAVING A MINIMUM FINANCIAL INTEREST OF 51 PER CENT OF THE CAPITAL AND GIVING AT LEAST 51 PER CENT OF THE EMPLOYMENT GENERATED BY THE ENTERPRISE TO WOMEN” GOVT. OF INDIA
Some vital statistics on women
• 70 % of 1.4 billion of the world poor people are women. • Of 30 million refugees 80 % are women and children • Of 1 billion illiterates two thirds are women • 150 million of kids not in school 2/3 are girls.
. • In India women are 48 % of the population but their participation in economic activity is only 34 %.
– To get economic independence
. Equity etc. importance and social status.Why they need to work
• Push Factors
– Death of bread winner – Sudden fall in family income – Permanent inadequacy in income of the family
• Pull Factors
– Women’s desire to evaluate their talent – To utilize their free time or education – Need and perception of Women’s Liberation. – To gain recognition.
Factors influencing woman Entrepreneurs
• • • • • • • • Establishing their own creativity Establishing their own identity Achievement of excellence Building confidence Develop risk taking ability Motivation Equal Status in society Freedom & mobility
travel agencies. 5 crore.
. etc. they asptre to turnover of more than Rs. health clinic etc.
• Second Category
– Established in cities and towns – Having sufficient education – Undertaking women services-kindergarten. crèches.Types of woman Entrepreneurs
• First Category
– Established in big cities – Having higher level technical & professional qualifications – Sound financial positions with businesses like export houses. beauty parlors.
Animal Husbandry. Fisheries. Agro Forestry. Horticulture. Dairy.• Third Category
– Illiterate women – Financially week – Involved in family business such as Agriculture.Self help groups those who are well served and mentored by micro finance institutions
. Power loom etc. Handloom.
• Fourth category
Women Entrepreneurship in India
• Earlier there were 3 Ks
– Kitchen – Kids – Knitting
• Then came 3 Ps
– Powder – Pappad – Pickles
• At present there are 4 Es
– – – – Electricity Electronics Energy Engineering
2 19.3 31.7 22.Women Work Participation
Country India (1970-1971) India (1980-1981) India (1990-1991) India (2000-2001) USA UK Percentage 14.6 45 43
Indonesia Sri Lanka
• Balaji films
– Ekta Kapoor
• Mahila Gram Udyog
– 7 ladies started in 1959: Lizzat Pappad
– Simon Tata
• Herbal Heritage
Main Problems for women entrepreneurship
• Dual role to play at workplace & at home place • Subordinate to men • Just that her being women • Non-awareness of facilities provided by government • Competition with large scale units • Problems related to marketing
• Encouragement to technical and professional education.Suggestions
• Procedure of getting finance should be simple • Effective propagation of programmes and yojna • Linkages between product. • Effective use of IT • Home based business
. services and market centers.
Role of Entrepreneur in Economic development
New product in market
New technology Creation of employment Discover new source of material Better Standard of living New ideas bring huge changes Develop new market Mobilize capital resources
Labour mgt c. Financial mgt e. Administrative mgt
. Technical feasibility b. Marketing mgt d. Production mgt b. Economic viability 2 Implementation 3 Production a.Problems and Challenges faced by Entrepreneurs
• Internal Problems of Entrepreneurs 1 Planning a.
communication) • Financial (capital. policy • Administrative hurdles • Corruption • Lack of direction • Competitive and volatile environment
.Problems and Challenges faced by Entrepreneurs
External Problems of Entrepreneurs • Infrastructural( Location. recovery. power. ) • Marketing • Taxation • Raw material • Industrial and financial regulations • Inspections • Technology • Govt. water. long term funds.
• Ten Deadly Mistakes of Entrepreneurship:
– Business entrepreneurship fail because:• • • • • • • • • • Management Mistakes Lack of Experience Poor financial control Weak marketing efforts Failure to develop a strategic and effective plan Uncontrolled Growth Poor location Improper inventory control Incorrect or unsuitable pricing The inability of to move into entrepreneurial thinking mindset from the previous secured permanent managerial position held.
– Know your business in depth. – Manage your financial resources effectively.• How to avoid failure in a Entrepreneurial business. – Develop a good. effective and solid Business Plan. – Have a thorough and complete financial statement.
. – Learn hire and manage people effectively.