Problems of entrepreneurship

Problems of entrepreneurship

1. Problems of Entrepreneurship Name- BADM Dept.

2. Problems of Entrepreneurship Traditional Society Indian society is, by and large, in the group of traditions, conservatism and blind faith. Traditionally, certain jobs are not considered good, even today. Due to caste system, people hesitate to leave their traditional occupations Hence people lack business interest, as also the risk bearing capacity and constructive thinking.

3. Problems of Entrepreneurship Hereditary Work The selection of work, occupation and business in India is not in accordance with interest, capacity and feelings. Rather, it is on the basis of hereditary adaption, caste system, religion and gender difference, etc. As a result the entrepreneurs are not able to select the business and industry, according to their capacity, interest and motivations.

4. Problems of Entrepreneurship Unproductive Expenditure People keep their savings, hidden with themselves or go on spending it on marriages, birthday parties, religious rituals, ornaments, immovable property and luxury goods, etc.

5. Problems of Entrepreneurship Lack of Infrastructure Facility Infrastructure facilities, required for development of entrepreneurship, like: means of transportation and communications, banks, insurance, electricity, water, raw materials, roads, stock market services capital market, organized product marketing, etc. have lacked in our country and hence the new entrepreneurs have to face difficulty in setting up the industries and the development of industries has been slow.

6. Problems of Entrepreneurship Lack of Enterprising Mentality Development of entrepreneurship depends upon the nature of human resources. However, several changes have taken place in the mentality of these resources, which have become obstructions in the development of entrepreneurship, like: People do not have high aspirations for gaining achievements. They take no interest in innovations. Most of the young people prefer to do some service, in place of going towards establishing and operating any business or industry The risk bearing capacity and ability to face contingencies of people have reduced. People lack high business and technical abilities. Initially, people participate in entrepreneurship development programmes which complete devotion. But after some time, their mentality goes on changing and they leave that sometimes they leave the idea of adopting entrepreneurship, after completing that programme .

7. Problems of Entrepreneurship Cultural Values Religion has deep effect on Indians. Our ideal has been, “Simple living, high thinking”. In Indian culture, much importance has not been given to material gains, personal property, economic pursuits and high standard of living.

8. Problems of Entrepreneurship Lack of Favorable Environment Every section of the society like workers, consumers, investors, government, etc. has its contribution, in operation of an industry. However, unfortunately, enthusiasm towards work lacks in our country. The consumers view the entrepreneurs, with sense of suspicion, capital is always scarce, policies of the government are also not very practical, competition is not healthy and has become cut throat.

9. Problems of Entrepreneurship Competition with Big Industrial Houses Business activities in India are substantially controlled by some industrial house. They have monopoly on business. Besides, priority is also being to public sector industries. Hence the new entrepreneurs do not think of setting up the industry, due to the reason that he is not in the position to compete with these houses and public sector industries. Hence the entry of new entrepreneurs is very limited.

10. Problems of Entrepreneurship Lack of Educational and Training Facilities Educational and training facilities related to entrepreneurship are available in India, but these have several deficiencies: Institutions making the entrepreneurs are not adequate. Education and training imparted in the institutions are not much practical in respect of entrepreneurship. Trained trainers are also not sufficient.

11. Problems of Entrepreneurship Inadequacy of Capital As compared to western countries, it is becoming difficult in India to maintain standard of living of its people, due to rising prices .

12. Problems of Entrepreneurship Socio- Cultural Factors Socio-cultural factors also attributed to slow progress of entrepreneurship in India, reason being that several caste-systems, social evils, religious blind faiths and fatalism exist in the country.

13. Problems of Entrepreneurship Opposition of Innovations and Changes In our country, traditional ideas are quite dominant. Scientific and logical approach towards problems is lacking.

14. Problems of Entrepreneurship Resource related Obstacles Several resource related obstacles are faced by entrepreneurship development programmes . Hence these programmes are not much successful. These obstacles are as follows: Adequate resources lack in the country. Physical and human resources do not become available to the entrepreneurs, in time. Some times, the cost of required resources being high, the entrepreneurs take less interest. The cost of imparting training to entrepreneurs being high, programmes do not get success.

15. Problems of Entrepreneurship Lack of Technical Structure Professional managers, specialists and trained employees and required for efficient operation of companies and public sector enterprises. It has been termed ‘techno structure’ by J.K. Gailbraith . Due to lack of techno structure in India, the entrepreneurs hesitate to bear the risk of large business.

16. Problems of Entrepreneurship Inadequate Government Facilities and Incentives Infrastructure facilities have not adequately developed in backward areas of India. Due to lack of allotment of land for development of industries, sources of energy an various infrastructure facilities and other incentives by the government, the entrepreneurs are unable to establish industries in backward areas.

17. Problems of Entrepreneurship Bureaucracy and Red Tapism On one side, very few facilities are being provided by the governments to the entrepreneurs and on another side the benefit of these facilities becomes available to very entrepreneurs, due to bureaucracy and red tapism . Several types the entrepreneurs feel unhappy, since in government officers, the officers and the employees do not pay attention on viability and still follow old traditional working style.

18. Problems of Entrepreneurship Concentration of Economic Power Most of the industries of the country are dominated by few big industrialists, which has obstructed the development of entrepreneurship, like: Small entrepreneurs do not get the chance to make progress. Big industrialists get success in twisting the government policies and rules in their favor. Big industrialists run parallel industrial role, along with the government.

19. Problems of Entrepreneurship Less Expenditure on Research and Development Government and private entrepreneur spend too less on research and development. The entrepreneurs consider expenditure on research and development, to be unnecessary. Hence, it not possible to encourage innovations.

20. Problems of Entrepreneurship Heavy Taxation and Corruption Taxation and corruption in India is such a mechanism, in which, whatever is done, is directly or indirectly at the cost to the public. In this situation, whether a person should bear this burden or should set up the industry. In such situation, rapid development of entrepreneurship is not possible.

21. Problems of Entrepreneurship Risk of Losing Invested Capital Starting a business is all about risk. And the small business failure rate is relatively high. According to a study by the National Federation of Independent Businesses (NFIB), 35% of businesses fail within two years, 54% fail within four years and 64% of new businesses fail after six years. When a business fails it can be financially and emotionally devastating. People contemplating entrepreneurship should decide how much they are willing to risk.

22. Problems of Entrepreneurship Lower Quality of Life Until the Business is Established Long hours and hard work can effect the entrepreneur's outside life. Business owners often put their role as company founder ahead of their role as husband, wife, or parent. Marriages and friendships are some unfortunate casualties of entrepreneurship. Part of the problem is that most people launch new businesses between the ages of 25 and 34, just when they start their families.

23. Problems of Entrepreneurship Complete Responsibility Entrepreneurship is highly rewarding, but many entrepreneurs find that they must make decisions on issues they are not very knowledgeable about. When there is no one to ask for answers, the pressure can build quickly. The knowledge that these decisions could decide the success or failure of a business can have a devastating effect on the business owner.