ENTREPRENEURSHIP forengineers necessary file

Helpful ppt for entrepreneurs

1. Entrepreneurship for Engineers By: Abriham A. Target Group: Leather Engineering Student (Batch-5)

2. Outline of the Course: Definition and types of Entrepreneurship and Entrepreneurs, Role of Entrepreneurs in economic development Advantages & Disadvantages of Entrepreneurship 1. Introduction 2. Creation of New Ventures & Assessing the Feasibility Meaning of New Ventures Setting-up of new venture Assessment and Evaluation of Entrepreneurial Opportunities Types and benefits of feasibility analysis in entrepreneurship 3. Growing the New Venture Concept of new venture growth The Management Team, Strategic Planning, Managing Growth, Financing Growth

3. Course Objectives & Competences to be Acquired Successful students in this course will be able to: Describe the process of Innovation& entrepreneurship, innovative problem solving in the business environment. Understand how innovation and competitive advantage contribute value to new business products and services. Understand the new venture growth & the entrepreneurial traits and skills needed in entrepreneurial ventures. Through the development of a business plan, evaluate the opportunities of a selected venture idea along with the constraints on its feasibility. 5. Risk and insurance of Business enterprises 6. Business plan Definition of Risk, The process of Risk management, Classifying risks by Type of Asset, Insurance of the Small Business. How to prepare business plan in project work

4. Chapter one 1 . Introduction to Entrepreneurship The word an entrepreneur is a person who was commissioned to undertake a particular commercial project. Entrepreneurship is then what the entrepreneur does. Entrepreneurial is an adjective describing how the entrepreneur undertakes what he/she does. The Entrepreneurial process which the entrepreneur engages is the means through which new value is created as a result of the project, the entrepreneurial venture.

5. 1.1 Meaning of entrepreneur Originated from French word , where an individual commissioned to undertake a particular project. An entrepreneur is a person who has already started or is in the process of starting an enterprise. Webster’s dictionary - “ one who organizes, manages and assumes the risk of a business or Enterprise ”. What do you think about the man/woman who started the local clothing drive, food bank, local barber , piano teacher, mechanic or math tutor ???

6. Cont. … Is an individual who: Has the ability to identify and pursue the business opportunities Undertake the business venture (project) Raise the capital to finance it Gathers the necessary physical, financial and human resources needed to operate the business venture. OR Is a person who: Creates the job not a job seeker. Has a dream Has a vision Willing to take the risk and makes something out of nothing.

7. Different Perceptions of an Entrepreneur To an economist, an entrepreneur is one who brings resources, labor, materials, and other assets into combinations that make their value greater than before , and also one who introduces changes, innovations, and a new order. To one businessman, an entrepreneur appears as a threat , an aggressive competitor, whereas to another businessman the same entrepreneur may be an ally, a source of supply, a customer, or someone who creates wealth. For others, the one who finds better ways to utilize resources, reduce waste, and produce jobs others are glad to get .

8. Role of Entrepreneurs in economic development Improvement in per capital income/ wealth generation- (the share of national product to the whole people in the nation) Generation of employment opportunity Inspire others toward entrepreneurship Balanced regional development. Because of computation, they have a chance to distribute throughout the whole region in the country. Concern for High Quality Work and Output – Increased Productivity . Enhance the number of enterprise Provide diversity in firms- (opportunity of variety business sectors in one area) Ensures economic independent- (independent of imports, technology, becomes exporter and compotator).

9. Types of Entrepreneur Innovative entrepreneur Introduce new products, new methods to produce Are mostly in developed Nations because sufficient opportunities of research and inventions remain available in these Nations, Imitative entrepreneur Copy suitable innovations made by innovative entrepreneurs They themselves do not carry or spend money on research, inventions Take relatively lower risks. Fabian entrepreneur Imitate the successful innovations, but with required caution. As far as possible they like to work with old methods only Shy, lazy and Non risk takers Drone Entrepreneurs does not want to accept any type of innovation or change. In the long run, such entrepreneurs face business failures

10. Entrepreneurs-types of business Depending on size, nature and type of business:- Business entrepreneur Develop business idea for new products or service Establish enterprise to materialise idea in reality Trading entrepreneur Undertake trading activities Have to identify potential market to stimulate demand Push many ideas ahead of others in the form of demonstration to promote their business

11. Cont. Industrial entrepreneur Essentially manufacture product and offer service Convert economic resources and technology into a profitable venture Corporate entrepreneur Innovative ideas and skill able to organise, manage and control a corporate undertaking efficiently Usually they are promoters Agricultural entrepreneur Agriculture and allied activities Engage in raising crops marketing of crops, fertilisers and other inputs of agriculture through employment of modern techniques, machines and irrigation.

12. Cont. What is Entrepreneurship? Entrepreneurship is the process of creating something new of value by devoting (giving) the necessary time and effort . It is the process of: Identifying opportunities arranging the resources required to pursue those opportunities investing the resources to exploit the opportunities for long term gains. OR It is the process through which an individuals become aware of business ownership then develop ideas for and initiate a business. 1.2 Meaning of entrepreneurship

13. Cont. … Entrepreneurship also can be defined as the process of creating something different and better with value by: Devoting (giving) the necessary time and effort . Accepting and acknowledging the necessary financial , psychological, and social risks , and Finally receiving the resulting economic rewards and personal satisfaction and freedom to do what you want.

14. Cont. … In general, the process of an e ntrepreneurship includes five critical elements. These are; The ability to perceive an opportunity The ability to commercialize the perceived opportunities The ability to pursue it on a suitable basis. The ability to pursue it through systematic means The acceptance of risk or failure.

15. Advantages of Entrepreneurship They are their own boss They can choose a business that interest them They can make lots of money Generation of Employment. Increasing per Capital Income. Balanced Regional development. Optimum Utilization of Resources. Promoting Self reliance. Helps in raising living standards. Dispersal of economic wealth. Economic independence.

16. Current Importance of Entrepreneurship Three areas of importance Innovation Process of creating, changing, experimenting and transforming Number of New Start-ups Important because new firms contribute to economic development through benefits such as product-process innovation Job Creation Vital to the overall long-term economic health of communities, regions, and nations

17. Disadvantages of Entrepreneurship Entrepreneurship is risky Entrepreneurs face uncertain, an irregular incomes Entrepreneurs work long hours Entrepreneurs must make all decisions by themselves Legal constraints and regulations. Monopoly and protectionism. Inhibitions due to patents. Low Level of Commitment. Shortage of Resources. Lack of Viable concept. Lack of market Knowledge. Lack of technical skill. Lack of seed Capital. Lack of Business Knowledge .

18. Discussion Questions Define entrepreneurship and explain its main characteristics. Innovation is the hallmark of entrepreneurship. Discuss An entrepreneur has an important role to play in the economic development. Comment. Not everyone can be an entrepreneur. Born or taught ???

19. Chapter Two: New venture Introduction: A venture is  a project or activity which is new, exciting, and difficult because it involves the risk of failure . New venture (entrepreneurial venture), is defined as  a business or activity which is in its early stages of business development and growth. Entrepreneurs are important to market economies because they can act as the wheels of the economic growth of the country. By creating new products and services, they stimulate new employment, which ultimately results in the acceleration of economic development . .

20. Setting-up of new venture Before go to setting up of new venture, an entrepreneur should aware the concept and role of new venture. Also he/she should take actions to establish the unit. In the absence of proper planning, all the business activities of the organization becomes meaningless. Therefore an entrepreneur must have creativity, independent thought and planning skill.

21. Steps in planning of setting-up a new venture: Step1 : Identifying & Generating the idea or opportunity It is the first and most important step. Here various techniques can be adopted for idea generation. Such as: Brainstorming-   a problem-solving method that involves the spontaneous contribution of creative ideas and solutions.  Group discussion- a group of individuals, typically who share a similar interest, who gather either formally or informally to discuss ideas, solve problems, or make comments. Data collection - the process of accumulating information and analysing variables of interest.  Market research - any set of techniques used to gather information and better understand a company's target market . Marketers can interview a person in their home, on the street, in the office or in a market research facility.  

22. Step2 : Environmental scanning It refers to the understanding of: Economic Political Technological Demography Socio-cultural Because directly they can influence the function of the business.

23. Step3 : Feasibility study : It refers the way of converting of plan/ idea into reality. It means the detail study of the business. Such activity helps to found the solution for each problem arise ( it may be material cost or other resources). It can  identify the logistical, financial, and market challenges of a proposed business  by evaluating: What the estimate would be to fund the project. When the potential business will offer a return on investment. The market for the proposed product or service . After feasibility study, an entrepreneur have to know about the entire project of new venture is either feasible or not .

24. Step4 : S electing the type of business : An entrepreneur should select the business type for which there is more demand . Example: an industry and commercial market Step5: scale/ size of the selected business: During selection, the business size may either large scale or small scale business. Way of scaling is depending on the capital and the demand.

25. Step6: S election of product Since product is the heart of an organization, selection of a product should be takes place carefully. Because; The selected product should be acceptable everywhere. Profitable product Product market should be wide Knowledge of technical process for manufacturing a product Some especial gain can be obtain if manufacturing is in industrial zone. i.e. special economic zone and agro export zone.

26. step7 : preliminary project report It is a simple data sheet that allows to provide the following information; Requirement of money, material and manpower for setting-up the project. Type of technology and machinery/ equipment are required for the project. Capital- how much economic gain (profit) from the project. Additional information includes: Entrepreneur’s profile; (name, address, education level, work experience, name& location of the project etc.) Detail of fixed and working capital requirement Total cost of the project. Source of capital ( share, loan ….)

27. Step8: Selection of form of the ownership The selection is depend on the amount of capital, liability, personal touch and legal formality. The form of the business ownership may be; Sole proprietorship Partnership Joint company Step9 : L ocation of business unit An entrepreneur should take location decision of a venture very carefully.

28. Cont. … During location decision, an entrepreneur has to take into consideration the following factors: Availability of the raw material, power, labours, banking, facilities, transportation and communication facilities. Nearness to market Modern information facility Step10: Requirement of finance & made capital structure: It includes fixed and working capital which may be loan, share or debenture .

29. Step11 : A cquisition of intellectual property (IP) It is  a type of property consisting of intangible creations of the human intellect, and typically includes copyrights, patents, trademarks, and trade secrets. The employer  owns the intellectual property created by the employee because the employer pays the employee in the form of a salary to do that work unless there is a specific agreement between the parties to the contrary Step12 : physical facilities Refers the type of machinery and equipment how to manufacture. Step13 : Registering small scale industries (SSI) unit Small Scale Industries (SSI) are industries that manufacture, produce and render services on a small or micro scale level .

30. Cont. … Registration is done with the state direction of industries. This helps to get many types of assistance from the government agencies. Few examples of small-scale industries are paper, & local chocolate etc. are mostly settled in an urban area as a separate unit . Step14 : Statutory obligation- An obligation is the responsibility of a party to meet the terms of a contract or agreement.  The statutory obligations applicable to the   design, construction and operation of buildin gs are extensive and complicated . It includes: Municipal licence - A business licence is an official permit that must be obtained to carry out certain types of business activity Power connection SI(standard institute) certificate- It is valid only for one year and founded to establish standards for the orderly growth of industries . Tax related formalities

31. Entrepreneurship and its feasibility analysis What is feasibility analysis? It is the process of determining weather a business idea is viable /workable. It is the preliminary evaluation of a business idea, conducted for the purpose of determining weather idea is worth pursuing (tracking of capital & other resources). A feasibility study allows a business to address where and how it will operate, its competition, possible obstacles, and the funding needed to begin . The business plan then provides a framework that sets out a map for following through and implementing on the entrepreneurial vision . Types of feasibility analysis in entrepreneurship There are four main elements that go into a feasibility study:  technical feasibility, financial feasibility, market feasibility (or market fit), and operational feasibility.

32. Cont. Technical Feasibility- it checks for accessibility of technical resources in the organization. The main technological resources are time, knowledge, the internet and software, which help businesses in a major way, like marketing and staying connected . In case technological resources exist, the study team will conduct assessments to check whether the technical team can customize or update the existing technology to suit the new method of workings for the project by properly checking the health of the hardware and software . Financial Feasibility- it allows an organization to determine  cost-benefit analysis . It gives details about the investment that has to go in to get the desired level of benefit (profit). Factors such as total cost and  expenses  are considered to arrive simultaneously . entrepreneurs can largely benefit from the economic analysis done .

33. Cont. Market Feasibility- It assesses the industry type, the existing marketing characteristics and improvements to make it better, the growth evident and needed, competitive environment of the company’s products and services. Preparations of sales projections can thus be a good market feasibility study example . Organization Feasibility-  it focuses on the organization’s structure, including the legal system, management team’s competency, etc . It checks whether the existing conditions will suffice to implement the business idea.

34. When to conduct feasibility analysis? Timing of feasibility analysis: The proper time to conduct feasibility analysis is early in thinking through the prospects for a new business Before screening idea a lot of resources are spent on them .   Generally, a feasibility study of a business can help to choose the best available alternative by assessing the opportunity cost.  It evaluates whether the project is likely to succeed or not. It highlights the key objectives of the project and lists out the benefits, risks, and roadblocks. It also offers alternative solutions and the means to achieve them.

35. Exercise How to asses/evaluate a feasibility study of an entrepreneurial opportunities? Why is a feasibility study important for entrepreneurship ?