Entrepreneur & Entrepreneurship.pptx

PPT on entrepreneurship

1. Entrepreneur & Entrepreneurship Done by Dr.R.Renganayaki SBK College, Aruppukottai

2. Who are the Entrepreneurs The word “ Entrepreneur ” is derived from the F rench word “ Entreprendre ”. Entreprendre means “ to undertake ”. In the 18 th century, Richard C antillion , an Irish man living in France was the first economist who introduced the term Entrepreneur It refers to the risk-taking function of establishing a new venture.

3. Other personalities who coined the term Entrepreneur In accordance to J.A.Schumpen , “A person who introduces innovative changes is an Entrepreneur and he is an integral part of the economic growth”. In accordance to Peter Druker , “Entrepreneur is one who always searches for change, responds to it and exploits it as an opportunity. Innovation is a specific tool of Entrepreneurs, the means by which they exploit change as an opportunity for different business/service”.

4. Entrepreneurship Entrepreneur – refers to a person. Entrepreneurship – refers to a function. In accordance to Schum Peter, “Entrepreneurship is based on purposeful & systematic innovation”. Thus, Entrepreneurship is a process involving various functions to be undertaken to establish an enterprise. Hence, Entrepreneurship is may be regarded as what Entrepreneurs do.

5. Relationship between Entrepreneur & Entrepreneurship Entrepreneur Person Organizer Innovator Motivator Leader Creator Risk Bearer Initiator Visualizer Technician Imitator Administrator Communicator Entrepreneurship Function/Process Organization Innovation Motivation Leadership Creation Risk Bearing Initiative Vision Technology Imitation Administration Communication

6. Importance of Entrepreneurship Entrepreneurs play a strategic role in commercializing new inventions & products They raise productivity through technical & other form of innovation. They make markets more competitive through creation of new markets. Micro Entrepreneurs operating in the informal sector established government authority when governments & their programs inhibit economic department By taking mix, the Entrepreneurs cause industries development in the country.

7. Quality/Characteristics of an Entrepreneur Hard work Business Acumen & Sincereity Predence Achievement Motivation Self-Reliance & Independence. Highly Optimistic Keen foresight Planning & organizing ability Innovativeness Risk taking High level of Energy Maintenance of Public Relations Communication skills

8. Quality/Characteristics of an Entrepreneur- Hardwork A successful Entrepreneur is one who is willing to work hard from the very beginning of his/her enterprise.

9. Quality/Characteristics of an Entrepreneur- Business Acumen & Sincerity It stands for shrewdness & ability. Again, the success of an enterprise depends upon the sincerity of the people behind the enterprise.

10. Quality/Characteristics of an Entrepreneur- Prudence A successful entrepreneur must be prudent in all his dealings. He should have the ability to work out the details of the venture from all the angles, access the favorable factors & pitfalls and take suitable measures to overcome the pitfalls.

11. Quality/Characteristics of an Entrepreneur- Achievement Motivation. The achievement motivation is the most important characteristic of an entrepreneur since all other characteristics emanate from this motivation. He must have a strong desire to achieve high goals in business.

12. Quality/Characteristics of an Entrepreneur- Self Reliance & Independence A successful entrepreneur wants to follow his own routine polices and procedures and he does not like to be guided by others. He does not like to work for others.

13. Quality/Characteristics of an Entrepreneur- Highly Optimistic He always expects a favorable situation for his business. He is able to run his business successfully in the midst of temporary hurdles.

14. Quality/Characteristics of an Entrepreneur- Keen Foresight An entrepreneur must have keen foresight to predict the future business environment. He has the capacity to visualize the likely changes to take place in the market, customer’s attitude, technological developments. Government policy and take timely actions accordingly.

15. Quality/Characteristics of an Entrepreneur- Planning & Organizing ability An entrepreneur is a firm believer in planning & systematic work. He have the ability to bring together all scattered resources required for starting a new venture.

16. Quality/Characteristics of an Entrepreneur- Innovativeness The entrepreneur should initiate research & innovative activities to produce new goods and services.

17. Quality/Characteristics of an Entrepreneur- Risk Taking He must love a moderate risk situation High enough to be exciting With a fairly reasonable chance to win.

18. Quality/Characteristics of an Entrepreneur- High Level of Energy An entrepreneur is more energetic than the average person That energy may be a critical factor given the incredible effort required to start a company. Long hours & hardwork are the rule rather than the exception.

19. Quality/Characteristics of an Entrepreneur- Maintenance of Public Relations Maintenance of public relation has a vital role to play on the success/failure of an entrepreneur. He must have cordial relations with the customers to gain their continued support. He must maintain good relations with his employees to motivating them to higher levels of efficiency He must maintain good relatives with his suppliers, creditors and the community at large. So that he may succeed in his venture.

20. Quality/Characteristics of an Entrepreneur- Communication Skill Communication Skill is the secret of the success of the most entrepreneurs Good communication skill enables them to put their points across effectively and with clarity helps them to win customers

21. Functions of Entrepreneurs An agent buys various factors of combining them into a finished product which can be sold in the market. He has to perform the following basic functions Risk Assumption Functions Decision Making Functions Managerial Functions

22. Risk Assumption Function Act as a risk bearing agent of production For instance, risks due to the possibility of changes in the taste of customers Changes in the techniques of production Changes in fashion New inventions Entrepreneurs assumes this risk and tries to reduce these uncertainties by his/her initiative, skill and admirable ability

23. Decision making function He has to take decisions at various stages He has to desire the nature & type of goods to be produced The size of the business Its locations Techniques of productions Second decisions at the appropriate time his business may succeed.

24. Managerial functions Managerial functions are the Co-ordination, Organization and supervision. He has to combine the land, labour & capital for production Managerial functions starting with planning & ending with controlling.

25. Functions of Innovation It is the most important function Innovation is a never ending process and ongoing function. Innovation involves introducing something new Innovation may be Introducing a new product New production technology Open a new market Discover a new source of supply of new material

26. Types of Innovation Incremental innovation This builds an existing idea or model, product or process Evolutionary Innovation This innovation builds on what is known and creates significant new value. It is the next step to incremental Breakthrough Innovation Breakthrough or novel products that are derived from experimental innovation.

27. Frugal Innovation Reducing the use of scare resources is known as frugal innovation. Combines various factors of production such as men, money, machines and methods. To get finished products which can be sold in the market.

28. Idea generations & choosing the right time to business It implies product selection and project identification. Ideas can be generated through various sources. Such as Project profiles Industries Potential surveys New product development in research laboratories Export statistics Probability studies of selected industries Trade fairs & exhibitions

29. Determination of Business Objectives An Entrepreneur should decide the nature and type of business he proposes to start. He should decide service oriented/trading oriented.

30. Market Research Success of any business depends upon its ability to market its products/services He should undertake market research to estimate the demand and supply for the product, size of products, future changes in the volume and patterns of supply and demand for the product.

31. Determination of Form of Organization He has to decide the forms of organization/ownership Main forms of organizations Sole proprietorship Partnership/Joint Stock Co.

32. Promotional Formalities Formalities such as Obtaining registration certification Clearances Submitting application for term and working capital loan

33. Raising of Funds He has raise funds for Purchase of fixed capital as well as working capital Aware of its various sources of funds Govt.Schemes /Assistance provided by financial institutions

34. Procurement of Machinery Should be careful in the selection and purchase of equipment and machinery

35. Procurement of Raw Material Timely and adequate availability of raw materials for continuous plan Identify the cheap and regular source of supply of raw materials

36. Recruitment of staff Recruitment of persons of various cadres such as Skilled & Unskilled workers supervisors Giving necessary training are the other functions of an entrepreneur.

37. Implementation of the Project Project identified is to be implemented in a time bound manner by the Entrepreneur Function of the Entrepreneur is to accomplish all activities from conception stage to commissioning stage in accordance with the schedule successfully.

38. Types of entrepreneur Innovative entrepreneur Innovative Entrepreneur is one who is able to potentially profitable opportunities through innovation This type of entrepreneur is highly motivated and talented and innovation is the key function. Adoptive/Imitative Entrepreneur Imitative entrepreneur is one who is ready to adopt the successful innovations already introduced by innovating entrepreneurs. He does not innovate anything by himself but he only imitates techniques and technologies innovated by others

39. Types of entrepreneur Fabian Entrepreneur He is ready to imitate only when it becomes perfectly clear that failure to do so would definitely result in heavy loss for him He is dominated more by customs, religions, traditions & past particles He is not ready to take any risk at all Drone Entrepreneur He is one who is blindly follows the traditional methods of the production even when it causes loss to him

40. Types of entrepreneur – Cole’s Classification Empirical Entrepreneur He is who never introduces anything revolutionary in his method of production or business He is simply follows the principle of rule of thumb He is similar to a drone entrepreneur Rational Entrepreneur He is who ready to introduce even revolution any changes on the basis of the general economic conditions prevailing in that area He takes rational decisions by himself depending upon the situation.

41. Types of entrepreneur – Cole’s Classification Cognitive Entrepreneur One who takes the advises and services of experts and introduces changes He acts on the advices of experts is called a cognitive entrepreneur.

42. Types of entrepreneur – On the basis of type of Business Trading Entrepreneur Who undertakes trading activities He identifies potential markets and creates demand for his chosen product line Industrial Entrepreneur He is a product oriented person who starts his industrial unit for manufacturing some new products

43. Types of entrepreneur – On the basis of type of Business Business Entrepreneur This type of entrepreneur conceives idea for a new product and create a business to materialize his idea into reality He engages in both production and marketing activities Agricultural Entrepreneur This type of entrepreneur undertake agricultural activities They raise the productivity of agriculture through modernization and application of modern technology.

44. Types of entrepreneur – On the basis of use of technology Technical Entrepreneur Entrepreneur who are technically qualified/experienced. They use their technical knowledge in production techniques and persons with experience who use their skills in production process, when they start their venture Non-Technical Entrepreneur Entrepreneur are concerned with the non-technical aspects of business such as developing marketing and distribution strategies to promote sales creating demand for their goods and services

45. Types of entrepreneur – On the basis of type of Business Professional entrepreneur Never stay in the business for long time Such entrepreneur identify innovative ideas and convert them into commercially.

46. Types of entrepreneur – On the basis of motivation Pure Entrepreneur Guided by motive, these entrepreneurs start new business, apply their business skill and prove their excellence in business Induced Entrepreneur Motivate potential businessmen to start their own ventures, the central and shake government offer subsidies in the form of Land at cheap rate Loans at concessional rate Tax exemption Supply of scare raw materials Subsidy on capital investment

47. Types of entrepreneur – On the basis of motivation Spontaneous entrepreneurs Inner urge and strong desire to become an entrepreneur, drive people start their own business Such entrepreneurs have self confidence and inborn talents to run the business successfully They setup their industrial units spontaneously with no motivation from others.

48. Types of entrepreneur – Other Classifications The New Entrepreneur They are basically very ordinary people who find themselves in extraordinary situations in a latter period Academic Entrepreneurs Teachers are referred as to as academic If they design new courses/make innovations either in curriculam /teaching methods/devise new methods of teaching.

49. Types of entrepreneur – Other Classifications Educational Entrepreneurs Many entrepreneurs have come up with new ideas to engage children during summer vacation. During vacations by organizing a varieties of short team course to suit the varied requirements of children and students Paper Entrepreneur A new class of entrepreneurs have engaged in this field for buying & selling of shares Buying & selling of companies , company takeovers, mergers etc.

50. Types of entrepreneur – Other Classifications Ontrepreneur / Netpreneur One can become an entrepreneur very easily by launching “online business”. An individual who launches a new business or an innovation through the internet called by Adam Bryant