Introduction to entrepreneur,entrepreneurship and enterprise

Pros and Cons of being an entrepreneur, types of entrepreneur,women entrepreneur-Problems,associations promoting women entrepreneur

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ENTREPRENEURSHIP
DEVELOPMENT

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Unit-1
Introduction to entrepreneur,
Entrepreneurship and enterprise

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Entrepreneur
Entrepreneurship and
Enterprise

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History of entrepreneurship
•16
th
century-military
•17
th
century –architects and contractors
•Rich farmers who manages and makes his business
profitable.
•Who run small business

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•18
th
century -entrepreneur was applied to business
initially

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Entrepreneur –Meaning & Definition
•The word entrepreneur is derived from French
word,entrepredre,which means to undertake
•In a business context, it means to start a business.

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•He gives top priority to R&D
•Works for the well being of the society (eg Foundations)

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•Features of entrepreneur are
•Creator
•innovator
•risk taker
•Change seeker
•Accepts mistakes
•Creator of quality
•Exploit opportunities
•Outstanding leader

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•An entrepreneur is a person who starts an enterprise. He
searches for changes and respond to it.
•Entrepreneurs are innovators who come up with new
ideas for product.
Eg; Nokia with torch ,
smart phones
Convertible freezer

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Definition
•An entrepreneur is one who always searches for change,
responds to it and exploits it as an opportunity. Innovation
is the central tool of entrepreneurs, the means by which
they exploit change as an opportunity for different
business or service
--Peter F.Drucker

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•Entrepreneur
refers to an
individual

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Entrepreneurship
•It can be described as a process of action an
entrepreneur undertakes to establish his enterprise.
•It is the function of arranging capital,labour and raw
material, finding site and introducing a new technique for
the enterprise.

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Definition
•“Entrepreneurship is the investing and risking of
time,money,efforts to start a business and make it
successful”
-Jackson

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•Entrepreneurship refers to the qualities of an
entrepreneur. Qualities are vision,creativity,organising
ability, innovative ideas,leadership,risk taking, decision
making, communication etc.

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Entrepreneurship Process
•Implement the innovative activity-idea and feasibility
•Strategy formulation and adoption-calculate the risk
•Monitoring the activities by adopting solutions for
problems –watches the progress whether yielding
positive or negative result

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•Finally the process involves
•(i) identification of opportunities
•(ii)converting business opportunity into reality
•(iii)identifying locational problems and solve them
•(iv)managing environmental problems
•(v)running business successfully

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Enterprise
•Place of business of an entrepreneur.
•It may be considered as “an organization engaged in a
business activity”
•It is the starting point of an entrepreneur.

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•It has vision and mission
•Organisation chart with levels of management.
•Span of management

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•Short-term and long-term plans
•Major objectives
•Well run enterprise practices PSPD

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•Predictability
•Sustainability
•Profitability
•De-risking

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12 marks
Pros and Cons of
being an entrepreneur

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Advantages (Pros)
•Bridge the gap between knowledge and
application.
•Converting an idea into money
•Be your own boss

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•Originality and respect.
•Competition.
•Better utilization of skills and knowledge

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•Alternative to current career.
•Business opportunity

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•Bridge the gap between knowledge and application.
•People acquire knowledge through education
•All are not interested in applying their knowledge
•Entrepreneurs can bridge the gap between knowledge
and its applications

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•Converting an idea into money.
•Innovative idea into reality
•Besides enjoying economic gain, makes society more
enjoyable
• eg: new model vehicle,jio

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Be your own boss
•People like to enjoy their lives independently
•They possess high capacity to take risk
•Provide opportunity to the society to improve the standard
of living

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Originality and respect
•Creative and original business ideas can be used for
societal benefit
•Originator is respected in the society for his better service

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Competition
•By adapting innovative ideas of entrepreneur the
product/services can be produced at a low cost.
•Society can get quality product.

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Better utilization of skills and knowledge
•Most of them hesitate to use their skill and knowledge for
the benefit of the society.
•Entrepreneur can utilize his creative skill and knowledge
for the benefit of the society.

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Alternative to current career.
•Many people with entrepreneurial skills will be working for
others (Intrepreneur)
•When they get frustrated working with others they can
change their position to employers

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Business opportunity
•People with entrepreneurial ability can utilize the business
opportunity for personal gain as well as for societal
benefits.
•Eg:Battery cars,philips T bulb, smart TV ,food processor

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Disadvantages (Cons)
•Remuneration
•Benefits
•Time Management
•Management
•Experience

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•Remuneration
no regular income
reward for risk bearing may be positive or negative

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•Benefits
• Start up problems
• enjoy normal profits
• threat of competition
• normal profit or break even

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•Time Management
• time is money for him
• dedicate himself to the business
• work schedule is not predictable

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•Management
• boss of his business
• decision making is the critical factor
• unknown risk

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•Experience
• unskilled person with unskilled staff have difficult
time

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Types of entrepreneur

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1.According to types of business
•Business entrepreneur-printingpress
•Trading entrepreneur-supermarkets,croma
•Industrial entrepreneur-hotel,leather,textile
•Corporate entrepreneur-tcs,wipro
•Agricultural entrepreneur-farmers

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2.According to the use of technology
•Technical entrepreneur-(production)goldsmith,software
•Non-technical entrepreneur(sales) –crackers,vendors
•Professional entrepreneur-start and sell
• start other biz

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3.According to motivation
•Pure entrepreneur-personal satisfaction
•Induced entrepreneur-govt support
•Motivated entrepreneur-help society
•Spontaneous entrepreneur-inborn talent

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4.According to growth
•Growth entrepreneur-flipkart(take high growth industry)
•Super growth entrepreneur-(Mukesh Ambani) shown
enormous growth.(in terms of profitability)

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5.According to stage of development
•First generation entrepreneur
•Modern entrepreneur-go well along with changing
demand (Apple-Steve jobs)
•Classical entrepreneur –concern for customers,maximize
economic gain,survivalof firm (hospitals,educational
institutions)

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Other types
•Fabian entrepreneur:
A Fabian Entrepreneur is one who is very cautious
in taking the decisions, very skeptical, and takes calculative
steps. Eg:Richfarmers

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•Drone entrepreneur
Drone Entrepreneurs won't accept the changes.
They will try to run their business in the traditional way and
they will even accept loss but not willing to adopt the
changes.
Example: tobacco industry

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WOMEN ENTREPRENEUR

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•Women entrepreneurshipis the process where women
organize all the factors of production, undertake risks, and
provide employment to others.

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Leadership Qualities
•Accept challenges
•Ambitious
•Hard work
•Patience
•Motivator
•Skillful
•Educated
•Experienced
•Intelligent
•Studious

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Psycho-Social Barriers
•Poor self-image of women
•Inadequate motivation
•Discriminating treatment
•Lack of courage
•Lack of social acceptance
•Lack of freedom of expression
•Afraid of failures
•Lack of leadership qualities
•

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Basic problems
•Start up finance
•Working capital management
•Lack of information
•Access to technology
•Regulatory requirements

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•Severe Competition
•Lack of confidence
•Marketing problems(male dominance)
•Shortage of raw materials
•Lack of encouragement from family
•Work-life imbalance

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Promotion of women entrepreneurs
•GAD-Gender and development in 1980,identified the role
of women as entrepreneur.
•Last 20years women are becoming entrepreneurs

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Measures to promote are
•Establishing small units
•Correct time for establishment
•Financial assistance
•Solving the problem of gender inequality
•Coordinating the dual role
•Training to have patience
•Training in financial management,IT

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Associations promoting women entrepreneurs
•SHGs-self help groups
•Federation of Indian Women Entrepreneurs(FIWE)
•Women’s India Trust(WIT)
•Consortium of women entrepreneurs of India(CWEI)
•SIDBI
•SIDO

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•NABARD-National Bank for Agriculture and Rural
Development
•Central and state government scheme
•SEWA-Self Employed Women’s
Association
•AWAKE-Association of Women Entrepreneurs of
Karnataka

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Example
•Rupjyoti SHG is a female group at Assam under Central
Jorhat Development block. The group was formed in the
year 2006 with a membership of twenty women. This
SHG’s experience proves how women with the help of the
cooperative principles organize themselves to beat
poverty and despair.
•The primary purpose of self help groups is to improve the
socio-economic status of poor rural women, especially to
increase their income.

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•All the members decided to conduct a meeting of SHG,
twice a month and decided that each member would
deposit an amount of 30/-per month. In the monthly
meeting the contributions would be mobilised and money
deposited in the bank in the first week of every month so
that members of the groups can take loan when needed.

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•The members of the group are primarily engaged in
weaving. They prepare Assamese dresses like gamosa,
makhalla sadar, woollen shawl, tangali (uses at the time
of bohag bihu) etc. in their own handlooms. Therefore,
they undertake tailoring, stitching and embroidery
activities like pillow cover, handkerchief, table cover etc.
They also make some of the decorated items according to
their needs.

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•The SHG members are engaged in some seasonal work.
They prepare varieties of food
items like pickle, at the time of bihu, laru-pitha, muri,
various other items made by coconut which are sold
locally. Some of the members are involved in the activities
like cow keeping, goatry and poultry. They also use the
milk for daily use in their houses.

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•During last two years, they mobilised their own resources
through thrift and credit activity. But, now they have
diversified their activity with the help of loan taken from
the Assam Gramin Vikash Bank, Lahdoigarh, Jorhat. They
got loan from AGBB amounting to Rs. 40,000/-for the first
time and after repayment of the loan again they again got
Rs. 1,20,000/-

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Factors influencing entrepreneurship
development
•Economic factors:
Capital
Labour
Raw Materials
Market

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•Social Factors:
Social Mobility
Family Background
Education
•Psychological factors:
Need for achievement
Perception and motivation
Learning and personality

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•Technical factor
•Political factors
•Legal factors

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Latest policies of
government towards
entrepreneurship

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•National Bank for Agriculture and Rural Development
•The Rural Small Business Development Centre(RSBDC)
•National Small Industries Corporation(NSIC)
•The National Commission for Enterprise in the Unorganised
sector(NCEUS)

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•Rural and Women Entrepreneurship Development
(RWED)
•World Association for Small and Medium
Enterprise(WASME)
•Start –UP India
•Make in India

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•Atal Innovation Mission (AIM)
•Support to Training and Employment Programme for
Women(STEP)
•Digital India
•Stand-Up India

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Importance and relevance of entrepreneur
•Generation of employment opportunities
•Improvement of standard of living
•Economic development
•Introduce new goods /services, new techniques, new
production methods,

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•Ensures balanced regional development
•Helps in import reduction and export promotion
•Development of infrastructure facilities –
roads,bridges,buildings etc

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•Equal distribution of income
•Empowerment of women
•Creation of social infrastructure –school,
colleges,healthcare, banking etc

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Characteristics of an entrepreneur
•Mental ability –intelligent and creative thinking
•Clear objective –to make profit or render service
•Business secrecy –safeguard business secrets

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•Human relation ability-good relation with
customer,employees,government,creditors,suppliers etc
•Communication ability –good communication with all
stake holders
•Technical knowledge
•motivator

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•Self-confidence
•Long-term involvement
•High energy level
•Problem solver
•Goal setter
•Risk taker

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Competency requirements
•It is one of the factor which
makes an entrepreneur
successful.

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Competencies are:
•Superintendence –supervise the work
•Control –control men,money,material,machinery at work
•Direction –goal oriented
•Innovation-introducing new product
•Organizer -proper allocation of task

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•Managing time
•Effective decision making
•Co-ordination of various business functions
•Fund management
•Initiate change
•Leadership qualities

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Awareness of self-competency and
development
•Everyentrepreneur should be aware of self-
competencies.
•This is also called core competence
•Core competence means strengthof
entrepreneur

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•“Understand Yourself”
•Appoint professionals or
outsource –in the area of
weakness

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Self competencies are
•To run business independently
•Opportunity recognition
•Action-oriented
•Desire for achievement
•Self-starting ability

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•Self-starting ability
•Risk bearing
•Creativity
•Networking
•Team building talent
•Hero-making
•Dynamism

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•Empirical mind set
•Pragmatic
•Leadership quality
•Belief in personal efficiency
These competencies are required for an
entrepreneur.