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Entrepreneur : 1. Person brings in overall change through innovation for the maximum social good. 2. He is a person responsible for setting up a business or enterprise. 3. He is one who has the initiative, skill for innovation and who looks for high achievements. 4. He is a catalytic agent of change and works for the good of people. 5. He puts up new green-field projects that create wealth, open up many employment opportunities and leads to the growth of other sectors.
Word µentrepreneur¶ derived from French verb µenterprendre¶ i.e. µto undertake¶. In early 16th century, Frenchmen who organised and led military expeditions were referred to as µentrepreneurs¶. Around 1700 A.D., term was used for architects and contractors of public works. In many countries, entrepreneur is often associated with a person who starts his own new and small business. Business encompasses mfg., transport, trade and all other self-employed vocations in service sector. But not every new small business is entrepreneurial or represents entrepreneurship.
Term µentrepreneur¶ was applied to business initially by French economist, Cantillon, in 18th century, to designate a dealer who purchases the means of prod. for combining them into marketable products. Another Frenchman, J.B.Say, expanded Cantillon¶s ideas and conceptualized the entrepreneur as an organiser of a business firm, central to its distributive and production functions. Beyond stressing the entrepreneur¶s importance to the business, Say did little with his entrepreneurial analysis. According to Say, he is the economic agent who unties all means of prod., the labour force of the one and capital or land of the others and who finds in the value of the products his results from their employment, the reconstitutions of the entire capital that he utilized and the value of the wages, the interest and the rent which he pays as well as profit belonging to himself.
J.B.Say emphasized the functions of co-ordination, organization and supervision. It can be said that the entrepreneur is an organiser and speculator of business enterprise. Entrepreneur lifts economic resources out of an area of lower into an area of higher productivity and greater yield.
New Encyclopedia Britannica considers an entrepreneur as µan individual who bears the risk of operating a business in face of uncertainty about the future conditions.¶
Whoever concentrates on this is rendering a much more important service to his country than the man who uses huge capital¶. Jan Tinbergen points out : µBest entrepreneur in any developing country is not necessarily the man who uses much capital. As Prof. but rather the man who knows how to organize the employment and training of his employees. but Joseph Schumpeter who argues that the rate of growth in an economy depends to a great extent on activities of entrepreneurs. . has probably put greater emphasis on entrepreneurial function than any other economist. Leading economists including Karl Marx have emphasized the contribution of entrepreneurs to development of economies.
performs one or more of following: i) perceives opportunities for profitable investments Ii) explores the prospects of stating such a mfg. . displays considerable initiative. grit and determination in bringing his project to fruition. He conceives of an industrial enterprise for the purpose. and in this process. enterprise Iii) obtains necessary industrial licenses Iv) arranges initial capital V) provides personal guarantees to financial institutions Vi) promises to met the shortfalls in capital Vii) supplies technical know-how. NEW CONCEPT OF ENTREPRENEUR: Term µentrepreneur¶ has been defined as one who detects and evaluates a new situation in his environment and directs the making of such adjustments in economic systems as he deems necessary.
CHARACTERISTICS OF AN ENTREPRENEUR A successful entrepreneur must be a person with technical competence. An entrepreneur must be reasonably intelligent. energy. self confidence. The entrepreneur should anticipate changes and must be able to study the various situations under which decisions have to be made. . 1. leadership qualities. intelligence. honesty. fairness. tactfulness and emotional stability. creativeness. attitude. Mental Ability: Mental ability consists of intelligence and creative thinking. and should have creative thinking and must be able to engage in the analysis of various problems and situations in order to deal with them. good judgment. initiative.
3.2. to make profit or to render social service. Clear Objectives: He should have a clear objective as to the exact nature of the goods to be produced and subsidiary activities to be undertaken. He should be able to make a proper selection of his assistants. Leakage of business secrets to trade competitors is a serious matter which should be carefully guarded against by an entrepreneur. Business Secrecy: He must be able to guard business secrets. . A successful entrepreneur may also have the objective to establish the product.
Human relations ability can also be referred to as tactfulness.Human relations ability: Most important personality traits contributing to the success of an entrepreneur are emotional stability.4. personal relations. suppliers. An entrepreneur who maintains good human relations with customers. He must maintain good relations with his customers if he is to establish relations that will encourage them to continue to patronize his business. consideration and tactfulness. employees. creditors and the community is much more likely to succeed in his business than the individual who does not practice good human relations. He must also maintain good relations with his employees if he is to motivate them to perform their jobs at a high level of efficiency. .
Technical knowledge is the one ability that most people are able to acquire if they try hard enough. employees. An entrepreneur who can effectively communicate with customers.5. Motivator: He must build a team. suppliers and creditors will be more likely to succeed than the entrepreneur who does not. Technical knowledge: He must have a reasonable level of technical knowledge. 7. 6. . Good communication also means that both the sender and the receiver understand each other and are being understood.Communication ability: It is the ability to communicate effectively. keep it motivated and provide an environment for individual growth and career development.
10. 12. Self-confidence: He must have belief in himself and the ability to achieve their goals. and above all make good use of resources. Long-term involvement: He must be committed to the project with a time horizon of five to seven yeas.8. Creativity is an essential ingredient.Persistent problem-solver: He must have an intense desire to complete a task or solve a problem.High energy level: Success of an entrepreneur demands the ability to work long hours for sustained periods of time. 9. . 11. No ninety-day wonders are allowed.Initiative: He must have initiative accepting personal responsibility for actions.
13. Goal setter: He must be able to set challenging but realistic goals. These personal traits go a long way in making an entrepreneur a successful man/woman. he associates and/or acquires and thus strengthens his enterprise. But however. . Moderate risk-taker: He must be a moderate risk-taker and learn from any failures. 14. In such cases. no entrepreneur possesses total strengths.
CHARACTERISTICS OF ENTREPRENEUR Administrative ability Organization skills Intelligence Creativity Innovation Clear objective Business secrecy Sound knowledge Emotional stability Public relations Effective communication Technical knowledge .
CHARACTERISTICS OF SMALLSCALE ENTREPRENEURS Young men Energetic/zealous/enthusiastic Minimum basic education Pleasant-mannered Hard-working Determined Systematic Self-made men Self-confident .
Disciplined men Follow planned approach Trained/experienced Have entrepreneurial zeal Meager capital Area of operation is small Deal in one product Employ few people Turnover is small Flexible .
CHARACTERISTICS OF LARGESCALE ENTERPRISE Promoted and professionally-managed through employed persons Large capital Capital contributed by a large section of shareholders Shares are registered in share markets/stock exchanges Large assets Assets acquired on classified credit Engaged in diversified activities Promotes and pushes goods in the market .
who foresee need of country well ahead of times Responsible and have a value-driven. corporate philosophy . Huge turnover/sales/profits Easy access to institutional finance Greater leverage for development Well acquainted with political and officialdom Trend setters Can create demand for their products through consumer awareness programme. Great visionaries. education etc.
Various types of entrepreneurs are : According to type of business : a. growth and stages of development. Business entrepreneur b. Service entrepreneur 1. . Corporate entrepreneur e. use of professional skill. Agricultural entrepreneur i) Plantation ii) Horticulture iii) Dairy iv) Forestry f. Trading entrepreneur c. Retail entrepreneur g.TYPES OF ENTREPRENEURS Broadly classified according to type of business. motivation. Industrial entrepreneur i) Large ii) Medium iii) Small iv) Tiny d.
Professional entrepreneur d. Non-technical entrepreneur c. According to the motivation: a. Super-growth entrepreneur . Induced entrepreneur c. Growth entrepreneur b. High-tech entrepreneur e. Motivated entrepreneur d. Spontaneous entrepreneur 4. Low-tech entrepreneur 3. According to the use of technology : a. Technical entrepreneur b.2. Pure entrepreneur b. According to the growth: a.
According to the stages of development: a. Classical entrepreneur 6. According to area: a. According to scale of operation: a. First generation entrepreneur b. According to gender and age: a.5. Modern entrepreneur c. Rural entrepreneur 7. Small scale entrepreneur b. Large scale entrepreneur . Men entrepreneur b. Urban entrepreneur b. Women entrepreneur i) Young ii) old iii) Middle-aged entrepreneurs 8.
9. Immigrant entrepreneur . National entrepreneur k. Bureaucratic entrepreneur m. Professional entrepreneur b. Traditional entrepreneur e. Inherited entrepreneur i. Forced entrepreneur j. International entrepreneur l. Non-professional entrepreneur c. Others or unclassified: a. Intrapreneur entrepreneur n. Modern entrepreneur d. Non-skilled entrepreneur g. Skilled entrepreneur f. Imitating entrepreneur h.
Assumption of Risk : He assumes all possible risks of business.FUNCTIONS OF ENTREPRENEUR 1. 2. . the entrepreneur has to bear the loss himself. techniques of production and does everything that is needed for the development of his business. which emerges due to the possibility of changes in the tastes of consumers. Thus. He enters the particular industry which offers him the best prospects and produces whatever commodities he thinks will pay him the most and employs those methods of production which seem to him the most profitable. techniques of production and new inventions. skill and good judgment. Such risks are not insurable. Business Decisions : He has to decide the nature and type of goods to be produced. If they meterialise. its location. risk-bearing or uncertainty-bearing still remains the most important function of an entrepreneur which he tries to reduce by his initiative. He effects suitable changes in the size of the business.
organises sales including management. sees to the finance. He formulates production plans. these management functions are delegated to the paid managerial personnel. deals with purchase of raw materials. . provides production facilities. Managerial Functions : He performs the managerial function though they are different from entrepreneurial functions.3. In a large establishment.
Abstract analytical tools. More business acumen than managerial or political skill. Time Orientation Respond to quotas and budgets. monthly. Often technically trained if in technical business. May upset Supervising and reporting employees by suddenly doing take most of energy. goal-oriented. Power-motivated End goals of 5-10 year growth of business in view as guides. weekly. traditional corporate self-reliant & self-motivated rewards. Gets hands dirty. Often business-school trained. quarterly. Takes action now to move the next step along way. May have former P&L responsibility in corporation. people-management & political skills Knows business intimately. Professional training. annual planning horizons.DISTINCTION BETWEEN AN ENTREPRENEUR & MANAGER Managers Primary Motives Entrepreneur Want promotion & Wants freedom. the next promotion or transfer Action Delegate action. Skills . their work.
) Status . Market Research Has market studies done Creates needs. forceful and ambitious. etc. Careful Like moderate risk. Creates to discover needs & guide products that often can¶t be product conceptualization tested with market research-potential customers don¶t yet understand them.Courage and Destiny Sees others in charge of Self-confident. his or her destiny. Can be courageous. Attention Risk optimistic. Invests heavily but expects to succeed. but may be fearful of others¶ ability in case of optimism. Talks to customers and forms own opinions. Primarily on events inside Primarily on technology and corporation market place. Cares about status Happy sitting on an orange symbols (corner office crate if job is getting done.
experiences.Failures & Mistakes Strives to avoid mistakes Deals with mistakes and and surprises. until he gets a feel of what bosses want. Delays decision Decisive & action-oriented. Postpones failures as learning recognizing failure. professional or agricultural back-ground . seeks system. power. Agrees with those in Follows private vision. Please others Pleases self and customers Decisions Who they serve Attitude toward the Sees system as nurturing May rapidly advance in a system & protective. when frustrated. position within it reject the system and form his or her own Problem-solving style Works out problems within Escapes problems in large the system & formal structures by leaving & starting over his own Family History Family members worked Entrepreneurial smallfor large organizations business.
some graduate work but not Ph. Absent father or good relations with father relations with father but slightly dependent Middle-class background poor Socio-economic Background Lower-class background in some early studies. .D. middle-class in more recent ones Less well educated in earlier studies. Educational Level Highly educated Relationship others with Hierarchy relationship as basic Transactions and deal making as basic relationship.Relationship Parents with Independent of mother. in later ones.
. ii) Use of new method of production. iv) The conquest of new source of supplying raw material or v) A new form of organization. i. Schumpeter (1934) for the first time put the human agent at the centre of the process of economic development and assigned a critical role to entrepreneurship in his theory of economic development. entrepreneur is a Schumpeterian innovator and something more than a leader. The entrepreneur looks for ideas and puts them into effect for economic development.e. as organiser of human capital.Entrepreneurship & Economic Growth Economic development of any region is an outcome of purposeful human activity. According to Schumpeter. economic development consists of employing resources in a different way¶. According to Baumol. According to him. He stands at centre of whole process of economic development. The process of innovation may be in the form of i) Introduction of new product. he depicted an entrepreneur not only a premier agent of production who brings together all factors of production but also provides a sound management and control for the survival as well as the growth of the production unit. iii) Opening of new market. bringing in a new combination of means of production. natural material resources. According to Schumpeter µEntrepreneurship is essentially a creative activity or it is an innovative function. worker and consumer. the entrepreneur occupies a crucial place in the process of economic development.¶ Hence. Men assume various roles in development process.
Thus the entrepreneur is the agent of change in society. and the existence of µinnovative entrepreneurs¶ depends on the necessary social and economic overheads. His hypothesis is that a society with a generally high level of achievement will produce more energetic entrepreneurs.e. Schumpeter further says that economic growth depends on the rate of applied technical progress (i. In the Indian context. products of innovators from other developed regions. who I turn will accelerate the process of economic development. These economic and social overheads are very poor in backward regions which cause short supply of entrepreneurs. In Schumpeter model. David McClelland explained the development of entrepreneurship in terms of human motivation to achieve or need for achievement. His role as an imitator is likely to be guided and controlled by various constraints and conditions peculiar to his area of operation and the factors under which he conducts his minimal modest industrial activity. but an µimitator¶ who would copy the organisation. entrepreneurship has yet another dimension. entrepreneur is an innovator. innovation) and rate of technical progress in the economic field which in turn depends on the supply of entrepreneurs in the society. . technology. An entrepreneur may not necessarily be in innovator.
. role expectations. According to him. There are thinkers who believe that the µSchumpterian entrepreneurs are needed in underdeveloped countries for rapid economic development¶ is only through entrepreneurs that substantial development can be brought about. Kunkel believes that the behavioral pattern of individuals is important for development and such a pattern can be influenced by external stimulus so as to alter it in the manner we want it. It becomes imperative that there exists a motivational training programme including measures to modify the environment to stimulate entrepreneurial behaviour among individuals. In other words. we can bring about such behaviour on their part by appropriate alterations in the social environment so as to influence them to take to entrepreneurial pursuits. if we want more people in society to behave as entrepreneurs. Entrepreneurs are an important source of economic development. Max Weber. expressed the view that creative and entrepreneurial energies are generated by the adoption of exogenously supplied beliefs which in turn produce intense efforts in occupational pursuits and accumulation of productive assets leading to the manufacture of goods and service. social tensions and inter-group relations in society. Cochran and Young underscore the importance of the role society plays in shaping the entrepreneurial personality and consider the scarce ingredients which are essential in the emergence of potential entrepreneurs cultural values. entrepreneurs are a product of the particular social conditions in which they live and it is the society which shapes the personality of individual entrepreneurs.
S. Germany. Area chosen by women are retail trade. hotels. Women entrepreneurs have been making a significant impact in all segments of economy in Canada. women own 25% of all business. Great Britain. cleaning. there is a phenomenal increase in no. religious. even though their sales on an average are less than two-fifths of those of other small businesses. cultural. In advanced countries of the world. of self-employed women after the Word War.S. education. restaurants. in Canada one-third. in France one-fifth. Australia and the U. In U. . social. insurance and manufacturing.Women Entrepreneurship The emergence of entrepreneurs in a society depends to a great extent on economic. cultural and psychological factor prevailing in society.
Often. She may also want to oversee and control every aspect of her business and may feel she will lose that opportunity if she grows to the point where she cannot. whether they are owned by men or women. Expansion might mean a loss of control or disruption in the amount of time she invests in other facets of her life. Dina Lavoie. whereas men are more likely to have nine employees or more. In a recent study. Professor of Entrepreneurship. she also explains that other identified differences such as higher interest rates. They have made their mark in business for the following reasons : i) They want new challenges and opportunities for self-fulfillment ii) They want to prove their mettle in innovative and competitive jobs iii) They want the change to control the balance between their family responsibilities and their business lives. lower credit approval rates and espousal co-signature requirements are primarily attributable to the fact that women operate younger and smaller firms that are known to meet with such financing problems. However. . it has mentioned that women face tougher security requirements on their lines o credit than do men. women business owners hire an average of two or three employees. Montreal has observed that. a micro-business fits a woman¶s life-style.
.2% of total 2.5% of total self-employed persons in the country were recorded. lowskilled. Only 2. Majority of them are engaged in unorganised sector like agriculture. 90% women workers were in rural areas and only 10% in urban areas. There were more than 2.86 lacs women accounting for only 4. only 1.96 lacs women entrepreneurs claiming 11. handicrafts.4% of total employed.64 million entrepreneurs in India during 1995-96. Participation of women as industrial entrepreneurs. This is almost double the percentages of women among the total population of selfemployed during 1981.5 million women workers were in organised sector-a mere 12. agro-based industries. majority were concentrated in low-paid.Women entrepreneurship in India As per 1991 census. Of this. however is comparatively a recent phenomenon ± commencing from 70s onwards. low-technology and low-productivity jobs in the rural and unorganised sector. handlooms and cottage-based industries.
Their participation. preparation of information material. creation of common marketing exposition centers. however. of activities such as motivational drive. and use of mass media etc. conducting training. is increasing. a no. creation of women industrial estate/areas/sheds. training of trainers/promoters. of women entrepreneurs particularly in district and rural areas were likely to be developed for small business. Combined effect of all these is bound to accelerate the process of women entrepreneurship development. a large no. . 9% were women entrepreneurs. are required. The rough estimate showed that amongst the SSI entrepreneurs aprox. The present rate of success in EDP training was likely to go up with growing experience and improved techniques of training and follow-up. Besides the SSI women entrepreneurs. In order to mobilise % of women entrepreneurs.
solar cooker etc. eatables. These factors indicate a relatively deeper commitment to entrepreneurial profession on the part of entrepreneur. the challenge and adventure to do something new. poultry. design. dairy. readymade garments. According to Mclelland and Winter. identifying the demand from the market. such as engineering. . doll-making. due to death or incapacitation of a near relation. we find women in different types of industries. external motivation. electronics. knitting. employment to needy and destitutes to set up an ancillary unit. ceramics. jewellery. business already in the family are some of the factors which gave stimulus to women entrepreneurs to start business. handicrafts. In addition. soap. toy making. traditional as well as non-traditional. special qualifications attained for running a concern. tax benefit for self and for relations are the push factors. plastics. nurseries. drugs. creches.Women entrepreneurs in Several Industries Today. liking for business and wanting to have an independent occupation are some of the attractive leverage for women. canning. textile designing. fabrics. Responsibility thrust. motivation is an critical factor that leads one towards entrepreneurship. This apart. printing.
It is observed that educational and experience has little or no effect on the choice of selection of business opportunity. Knowing their other limitations. 15% for plastics. The impression is that pickles and garments are the products specially suitable for women. the enterprise set-up by women cover a wide range of activities and only 2% are in food products and 13% in traditional business of garments/hosiery. 20% women opt for chemicals. There is general belief that women have inclination towards simple products involving low technologies. 10 lacs investment. 70% of enterprises set-up by women below Rs. 7% for electronics items etc. . they prefer smaller projects and thus select business opportunities requiring moderate investment.Moderate Investment Mostly women are interested in moderate returns. Selection of business venture is depended on background of entrepreneur. While the selection of opportunity is based on the motives and special constraints for women. 12% for engineering.
rather a close higher correlation is found between the activities of husband and the venture selected by a woman. A lady with no technical qualification may be in business of manufacturing electrical bulbs or special chemicals. a lady with specialised knowledge of computer software may be in printing business. General assumption that only technically qualified woman will go for technical items and other prefer non-technical items does not seem to be hold true. : . Similarly.
. before returning to the job market. advertising. had a family and went back to work for a year before deciding to take a break in her career. she reared two children before taking up a job as executive assistant to TELCO¶s resident director there. Then she moved to Citibank. Six year later. communications. after raising two children to school-going age. she joined American Express Bank in Delhi as a senior account manager. at TELCO. management and perhaps even banking. Delhi. Both women entrepreneurs symbolised a small but growing phenomenon. Another woman graduate of IIM had opted out of her job as assistant manager. advertising and banking. For five years. As most professional women have confirmed it¶s easier to make a comeback in sunrise professions like marketing. And its phenomenon that¶s cutting a broad swathe across industries as diverse as computers.Women Intrapreneurs A woman graduate of IIM started her career with a two years stint at Citibank in Mumbai. women who quit relatively well-paid jobs to raise children.
. weak collateral position..Profile of woman entrepreneur & her business Fist-born child of middle class parents Father and/or mother in independent business Collage-educated. Marketing & Inf. Personnel management Biggest problems in current operations : Lack of exp. High energy level Biggest problems in start-up Lack of business training : Obtaining credit. Moderate risk-taker High tolerance for ambiguity. Married Early 30s for the first significant venture Previous experience in new venture Desires independence Motivated by desire for independence and job satisfaction Small and young business Self-confident. Cash flow mgmt. Taxation . seed capital. In financial plg.
OUTSTANDING QUALITIES OF WOMEN ENTREPRENEURS Accept chanllenges Ambitious Drive Enthusiastic Hard work Patience Industrious Motivator Skilful Unquenchable optimism Adventurous Conscious Educated Determination to excel Keenness to learn & imbibe new ideas Experienced Intelligent Perseverance Studious .
coordinating and directing. controlling. planning. organizing. .Psycho-Social Barriers Poor self image of women Inadequate motivation Discriminating treatment Faulty socialization Role conflict Cultural values Lack of courage and self-confidence Inadequate encouragement Lack of social acceptance Unjust social-economic and cultural system Lack of freedom of expression Afraid of failures and criticism Susceptible to negative attitudes Non-persistent attitude Low dignity of labour Lacking in leadership qualities i.e.
1. Establish a savings and loan institution to provide credit to women to start fifty new businesses per year c. . To strengthen women entrepreneurs through public policy advocacy & research : a. Inform policymakers on monthly or quarterly basis about the organization's activities. Legislators. Organise public policy days to educate women on legislation that affects them. officials and representatives of women¶s business orgs. Would participate. skills so they can gain the tools and confidence to run their businesses. Help identify partners for women-owned businesses. Develop a databank with local. regional and national economic and political information to be used by the organization's members. providing them with data on annual revenues generated by women-owned businesses as a % of GNP and how much these revenues contribute to the national tax base. To expand services. to women business owners a. b. b. such as training & credit. 2. c. govt. Train 200 women in negotiation leadership and mgmt.Goals & Supporting Activities of Women¶s org.
educators & mass media representatives to meet each other. training programs. To promote women¶s entrepreneurship : a. 4. Organise monthly networking events for professional business women. political officials. develop professional contacts and discuss common issues. Sponsor a contest to honor a leading business woman c.3. c. etc. Publish newsletters. . Set up a databank for women entrepreneurs to include information on business opportunities. Develop a campaign targeted at the local media and schools to portray successful women in business. To empower women business leaders through networking : a. Hold an annual grade show to bring women entrepreneurs together with potential partners or investors b. profiles of women entrepreneurs and data to highlight their economic contribution to society b.
Development of Women Entrepreneurs .
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