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Module -1 Entrepreneur
DEFINITION OF AN ENTREPRENEUR According to the dictionary the word Entrepreneur can be defined as one who reorganizes and manages only enterprise especially involving high risk. If taken literally, this definition seems fine, but it is quite incomplete. Researches have shown that entrepreneurs are not necessarily high risk-takers. However, a clever entrepreneur performs to reduce risk and increase the likelihood of success. The definition nowhere mentions anything about opportunities or resources allocated to achieve the success. The only point mentioned in the definition is regarding high risk, which h might not even be Necessary to be successful. An economist defines an entrepreneur as one who beings resources, labor, material and other assets in to combinations that make their value greater than before and also one who introduces changes, innovations and anew order. A Psychologist defines an entrepreneur as a person who is typically driven by some forces, which create a desire to obtain or attain something. A sociologist defines entrepreneur as a person whose actions would determine his social status and who contributes to the development of the society. Management experts define entrepreneur as a person who has a vision and generates an action plan to achieve it. The word itself is derived from the 17th century French verb Entrepreneur and the German word Uternehmen both referring to individuals who are undertakers, i.e. those who undertook the risk of new enterprise. They were contractors who bore the risks of profit or loss; they were soldiers of fortune, adventurers, builders or merchants Though many traits taking, innovation has been associated with the term entrepreneur, which portrays an image as if entrepreneurs are only those individuals who take up the challenges of creating a business with new concept and ideas? But this is not true. Research scientists like Edward de Bono have pointed out that the most important t variable required for entrepreneurship is not innovation, but value addition. Which means that is not always important that an individual comes up with an entirely new idea to be called an entrepreneur. If he is adding incremental values to the current product or service he can rightly be called an entrepreneur.

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Characteristics of an Entrepreneur An Entrepreneur has a dream and he visualizes the ways and means to achieve that dream. In doing so he visualizes market demands, socio-economic and the technological environment and then based on these dynamics, he visualizes a future for his business venture. 1. Vision:- An entrepreneur has a dream and he visualizes the ways and means to achieve that dream. In doing so he visualizes market demands, socio-economic and the technological environment and then based on these dynamics, he visualizes a future for his business venture. 2. KNOWLEDGE: An entrepreneur has sound conceptual knowledge about all the technicalities of his business be it technological, operational, financial or market dynamics. 3. DESIRE TO SUCCEED: An entrepreneur has strong desire to succeed in life. Their dreams are not just limited to achieving one single goal but they constantly work to achieve higher goals. 4. INDEPENDENCE: An entrepreneur needs independence in work and decisionmaking. They dont follow the rules of thumb but make their own rules and destiny. 5. OPTIMISM: Entrepreneurs are highly optimistic about achieving their vision. 6. VALUE ADDITION: Entrepreneurs do not follow the conventional rules of thumb. They have a constant desire to introduce something new to the existing business. They create, innovate or even add value to the existing products/services and therefore, stand out in the market. 7. LEADERSHIP: An entrepreneur exhibits the qualities of leader. They are good planners, organizers, have good communication skills, are empathetic towards their employees, are good decision-makers, take initiatives to implement plans and are result-oriented. 8. HARDWORKING: At times they are called workaholics. Work is worship for them. They put in continuous efforts to achieve success and know that there is no substitute for hard work. 9. DESIRE TO HAVE CONTROL OVER THEIR FATE: Entrepreneurs do not want to move in herds like sheep but want to pave their own paths. They do not believe in luck or destiny.

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10. RISK- taking ability: Frank Knight has identified risk-taking ability as the most integral element in defining entrepreneurial characteristics.

ENTREPRENEURIAL PROCESS: At its simplest what entrepreneurs do can be viewed as a six-stage procedure: 1. They see opportunities where others dont. 2. They have a vision, a clear understanding of the concept and of what theyre trying to do. 3. They persuade others of their vision, they can communicate the concept effectively. 4. They gather resources to make their vision become a reality (money, people, and things). 5. They organize these resources to create a new venture, product or market (leadership, Teams). 6. They constantly change/adapt themselves according to the changing demands of the market.
IDENTITY AN OPPORTUNITY

ESTABLISH VISION

PERSUADE OTHERS

GATHER RESOURCES

CREATE NEW VENTURE,PRODUCT OR MARKET

CHANGE/ADAPT WITH TIME

i) IDENTIFY AN OPPORTUNITY: According to Timmons (1989) entrepreneurship is about sensing an opportunity where others see chaos, contradiction and confusion.

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Identification of an opportunity is the first step towards building and running successful Business enterprise. Entrepreneurs identify opportunity where o0thers see obstacles and impossibility. Identification of opportunity at the right time is of utmost importance as it gives first movers advantage and takes an enterprise ahead of others who take time to catch up. The first movers advantage not only provides product identification and higher market credibility but also provides better profits and faster economies of scale. Example: Kushagra Bajaj of Bajajs Hindustan; after coming back from US in 2000 with a masters degree in management, he found a big opportunity in the sugar industry in India. The demand for sugar was on rise and there were 100 sugar mills declared sic k out of a total of 553 mills in the sugar industry. He took this problem as an opportunity and took Bajaj Hindustan to the top-notch position in 2005, in the process, becoming the leader in sugar industry in India). (ii) Establish a Vision: Merely seeking opportunity is not enough; an entrepreneur further moves to establish a vision a dream for future which h can be achieved only if opportunities are tapped at the right time.; He has complete faith in his vision and it is quiet clear to him i.e. he can visualize his own optimism. Even if some market forces change, he would re-adjust his vision to keep his dream viable and fruitful. And believe it, entrepreneurs have big visions, something which others might consider as impossible. Example: Dhirubhai Ambani of Reliance had dreamt that he would put a mobile phone in every individuals hand, land the rest is history. We all know that today, even vegetable sellers, farmers, milkmen, gardeners etc are all carrying mobile. Dreaming this big in a poverty-stricken country like India needs guts. (iii) Persuade others: An entrepreneur does not work along, he understands that multiple skills are required to make business successful. Kathleen Allen, an American, academician calls this phase of entrepreneurial process forming the foundation team i.e. an entrepreneur forms a group of individuals who would work together to realize his dream. An entrepreneur prepares a business plan to make the vision and means of achieving the vision clearer to the others who would join the teamed individuals are not just the skilled people who would join in, but also include financiers and even family members who put in their trust in the entrepreneur. (iv) Gather Resources: Identifying an opportunity, establishing a vision and persuading others to join is not enough; a business enterprise needs resources to become successful. This is the phase, which can convert an entrepreneurs dream into realty. Although we are presenting this process as it happens step by step, implying that issues pertaining to resources are considered here, the reality is that part of the early evaluation of the concept will inevitably involve a preliminary evaluation of whether it can be properly resourced. Resources can be considered under four categories: 1. Financial 2. Operating 3. Human 4. Information Parameshwara. P 4

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(v) Create New Venture: Once the entrepreneur has arranged for the resources mentioned about, the next step is the creation/establishment of the new venture and running the business venture successfully while the former task (creation of new venture) requires lot of enthusiasm, persuasion so that he is able to gather optimum resources. The latter task (running the business venture) requires lot of perseverance and passion to believe in self. (vi) Change/Adapt with time: As change has become the rule of the game in todays business environment the entrepreneur needs to continuously keep the organization upgraded and abreast of changing times. This is not a n easy task as it not only involves availability of funds for introducing change but also (which is even more difficult) the adaptability of human resources towards the changed environment. FACTORS RESPONSIBLE FOR EMERGENCE OF ENTREPRENEURSHIP: An individuals decision to pursue an entrepreneurial career is dependent on various factors, These have been discussed below: 1. Background Factors: (a) Education, Training and Experience: The type of education, training and experience an individual has acquired influences his choice of setting up an enterprise. Technically, qualified persons normally set up their ventures in the field of their specialization, mainly because working in ones area of specialization provides confidence and reduce es the uncertainty with the new venture. (b) Family, role models and association with similar type of individuals: If an individual has a supportive family, has role models who have been successful or are in association with the same or similar type of business activity the individual is engaged in, they add vigour to his desire to set up a new venture. (c) Financial Conditions: Both adverse and supporting financial conditions can motivate an individual to set up a new venture. When an individual is unemployed or is not able to support his family demands, or if he has surplus funds, he may start looking for a new business venture where he can put in his time/money to achieve success and thus fulfill his demands. 2. Motivational Factors Need for achievement: This has been identified as the most important reason for Entrepreneurial motivation by various researchers. Need for achievement means the drive to achievement means the drive to achieve a goal. Entrepreneurs have a compelling drive to succeed. They strive for personal achievement rather than reward per se. They have the desire to do something better or more efficiently than it has been done before. Personal motives/expectations: This has been found to be one of the crucial factors responsible for entrepreneurship amongst individuals. These individuals have an internal focus of control i.e. they consider themselves responsible for their growth and development. Parameshwara. P 5

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( c) Business Environment: Supportive business environment like low rate of competition, high profit margins, good economic condition of the region, high demand all contribute towards motivating an individual to set up a new venture. a) Supportive government policies: From time to time, the government keeps formulating policies and programmes to promote entrepreneurs in different fields. Tax holidays, for instance, are such a policy measure. These policies and procedures go a long way towards catalyzing the entrepreneurial motivation. Availability of financial assistance from various funding bodies: An Entrepreneur needs funds to set up a business and many may not be having the required funds to support the requirements of the business set up. In such situation he/ she can obtain assistance from financial institutions. Hence the financial institutions can facilitate the setting up of a new venture by easing out the disbursement of funds to them. Ancillary support: Ancillary support from suppliers, distributors, retailers etc., even bigger units can act as a great encouragement to budding entrepreneurs. Availability of technical factors like premises, electricity, labour: Feasibility with which factors of production are available to the entrepreneurs will facilitate/ obstruct an entrepreneur in making the final decision of setting up a business venture and even in the success of a business. Reward:a) Recognition: Since the success of a business is usually proportionate to the efforts put in by the entrepreneur, setting up of new ventures gives an entrepreneur an individuality, the outcome of which is highly dependent on him. Since the success of an enterprise is associated with the efforts and success of an entrepreneur he/she gets enough recognition to enhanced his/her self-esteem.

Social status: Entrepreneurship is the way to get large profit margins which a salaried employee cannot even think of. Hence, if the business runs successfully, it automatically raises the social status of an individual. Moreover, the idea of being responsible for ones fate, employing a number of individuals, taking important decisions, all go along way in bestowing a higher social status upon an individual. TYPES OF ENTREPRENEUR Classification on the basis of ownership: Founders or pure Entrepreneurs. As the term suggests, they are those individuals who are the founders of the business. They are the ones who conceptualize a business plan and then put in efforts to make the plan a success. For example, Dhirubhai Ambani of the Reliance Group. Second-generation operators of family-owned business: They are the individuals who have inherited the business from their fathers and forefathers. Like Mukesh Ambani and Anil Ambani sons of Dhirubhai Ambani of the Parameshwara. P 6

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Reliance Group now split into two: Reliance Reliance Industries Limited and Reliance Anil Dhirubhai Ambani Group. Franchisees: Franchisee has been derive ed from a French word which means free. It is a method of doing business wherein the parent owner (the franchiser) licenses his trademarks and tried and proved methods of doing business to a franchisee in exchange for a recurring payment. Here, the franchisee has not conceptualized the business but has invested his money and time in the business. For example, NIIT has given its franchisee operations to local players after thorough scrutiny and proper training. These franchises follow the same curriculum, use the same set of books, have the same pricing strategy and award the same degree. They share the profit margins and get training, curriculum design and books from the parent company i.e., NIIT. Owner Managers: When a person buys a business from the founder and then invests his time and resources in it he is called the owner-manager. Like Sabeer Bhatia is the founder entrepreneur of Hotmail, whereas Microsofts Bill Gates became its owner manager after buying it for 400 Million Dollars. CLASSIFICATION ON THE BASIS OF PERSONALITY TRAITS AND THEIR STYLE OF RUNNING THE BUSINESS: The Achiever: These types of entrepreneurs have personal desires to excel. The only drive that pushes them is the desire to achieve something in life, the desire to make a mark in society, the desire to prove their excellence. No matter how many hurdles come in their way, they are totally determined. They do not need any external stimulus but are self-driven ed. Their characteristics can be termed as achievement personified. They can rightly be called go-getters. This personality often will cause them to build their business around their own personal brand. These entrepreneurs have dreams and dare to fulfill their dreams. Like NarayanMurthy , who had a settled life and was working, quit his job and ventured out on his own to start Infosys. The Induced Entrepreneur: These types of entrepreneurs are induced by some external factors to start a business. The external factors could be like supporting government policies, unemployment, family support, facilitating institutional support, etc. These types of entrepreneur turn out to be more realistic in their approach. For instance, when the government announced subsidies, tax rebates and financial support to small scale industries, several entrepreneurs started their business as SSIs. The Idea Generator: These kinds of entrepreneurs are highly creative People who are always in search h of innovative ideas for setting up new Business ventures. They have the ability to sense the demand much ahead of others. They enjoy the First Movers Advantage and are able to skim higher profits from the market. They can rightly be given the title of Essence of Entrepreneurship. : Like Bill Gates of Microsoft, who began the manufacturing of microcomputer software? 4. The Real Manager: The real Managers run the business in a systematic manner. They analyze business situations; assess the demands of future, both in terms of Opportunities and threats and then take actions based on the above assessments. They believe in incremental changes rather than radical transformations. Parameshwara. P 7

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The Real Achievers: The real achievers are full of life. They are looking for the achievement of not even their own goals but also of people associated with themselves like employees, suppliers and distributors. Classification based on the type of business:

Industrial entrepreneur: Industrial entrepreneur is an entrepreneur who is into manufacturing of a product. He identifies the needs and wants of customers and accordingly manufacturers products to satisfy these needs and wants. It would include all the entrepreneurs essentially into manufacturing. Trading Entrepreneurs: Trading entrepreneur is one who undertakes trading activities (buying and selling of goods and services) and is not concerned with the manufacturing of products. He identifies potential markets, stimulates demands and generates interest among buyers to purchase a product. Corporate Entrepreneur:- Corporate entrepreneur is a person who demonstrates his innovative skill in organizing and managing a corporate undertaking (which is registered under some stature or act that gives it a separate legal entity.) Agricultural Entrepreneur:- Agricultural entrepreneurs are those entrepreneurs who undertake business related to agricultural activities. Like farm equipments, fertilizers and other inputs of agriculture. They provide supportive products that can increase the agricultural products thought biotechnologies, mechanization and improvement in agricultural yield. Based on the stages of Development:First Generation Entrepreneur: A first-generation entrepreneur is one who starts an industrial unit by means of an innovative skill. He is essentially an innovator combining different technologies to produce a marketable product or service. Modern Entrepreneur: A modern entrepreneur is one who undertakes business to satisfy the contemporary demands of the market. They undertake those ventures which suit the current socio-cultural trends. Classical Entrepreneur: A Classical entrepreneur a stereo-type entrepreneur is one whose aim is to maximize the economic returns at a level consistent with the survival of the firm, with or without element of growth. Others: Innovative Entrepreneurs: Innovative entrepreneurs are the forbearers of change in the business. They are full of creative ideas and offer innovative products to the society. It is because of these innovative entrepreneurs that many important changes occur in our society. They experiment and conduct permutations and combinations of ideas to yield new product s and services, Thanks to these innovative entrepreneurs, our society is Parameshwara. P 8

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more networked now; we started off networking by transfer of letters through a messenger (stories even speak of pigeons as messengers), then came formal postage system, then communication. evolved to telephonic conversation, mobile, internet, email, and video conferencing. The innovations as networking have been tremendous and are still happening values (like ring tones, cameras, mobile television, mobile radio in mobiles), or change the unity of the same thing (like using mobile for net surfing. Initiative Entrepreneurs: Initative entrepreneurs adapt a successful innovation. They are risk-aversive and so they do not try out new ideas or products, but is a new idea is accepted by the market, they imitate the new idea and hence join in the competition. Fabian Entrepreneurs: Fabian entrepreneurs adapt a successful innovation. They are not readily interested in introducing any change in their organization and when they do so it is because unless they the change they would be out of the market. Drone Entrepreneurs: Drone entrepreneurs are not open to creativity and change They do not like changing the working of organizations with the changing the working of organizations with the changing times. They prefer facing losses to introducing changes in their present processes, equipments and policies. In the present competitive world, these entrepreneurs are simply kicked out of the business for not being able to adapt themselves to the changing dynamics of business.. Women Entrepreneurs: In 1988, for the first time, the definition of Women Entrepreneurs Enterprise was evolved that termed an SSI unit/industry-related service or business enterprise, managed by one or more women entrepreneurs in propriety concerns, or in which she/they individually or jointly have a share capital of not less than 51 per cent as company/members of a cooperative society, as a Womens Enterprise. Corpreneurs:- When both husband and wife together start and run a business venture then they are called copreneurs. Emergence of copreneurs in the present times is a reflection of the fact that womens role in business is increasing. INTRAPRENEURSHIP: The term intrapreneur emerged in during the seventies. Several senior executives of big corporations left their jobs to start their own small business because the top bosses in these corporations were not receptive to innovative ideas. These executives -turned entrepreneurs achieved phenomenal success in their new ventures; posing a threat to the corporations they had left. These types of entrepreneurs came to be known as intrapreneurs, This kind of brain drain phenomena is not limited to the US, but has spread all over the world, Companies, as a result, have started devising ways and means to stop this outflow of talent, experience e and innovation. The notion of intrapreneurship requires that managers inside the company should be encouraged to be entrepreneurs within the firm rather than go outside. For an entrepreneur to survive in an organization he/she needs to be sponsored and given adequate freedom to implement his ideas. Otherwise, the entrepreneurial spark will die. The entrepreneur who starts his own business generally does to because he aspires to run Parameshwara. P 9

Entrepreneurship Development his own show and does not like taking orders from others. INTRAPRENEURING; DEFINITION

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Intrapreneuring means the entrepreneurial activities that acquire organizational sanctions and commitments of resources for the sole objective of innovative results. Intrapreneuring aims at boosting the entrepreneurial spirit within the limits of organization, thus creating an environment to develop. Intrapreneurship centers around the restructuring and re-emergence of the firms capacity to develop innovative skills and new ideas. Intrapreneurship is not just limited to the germination of new ideas, but includes even the implementation of those ideas. CHARACTERISTICS OF INTRAPRENEURS: Intrapreneurs bridge the gap between inventors and managers. They take new ideas and turn them into profitable realities. They have vision and the courage to realize it. They can imagine what business prospects will follow from the way customers respond to their innovations. They have the ability to plan necessary steps for actualization of the idea. They have high need for achievement and they take moderate calculated risks. They are dedicated to their work that they shut out other concerns, including their family life. Following is a table giving an insight into the basic differences between Managers, Entrepreneurs and Intrapreneurs. Point of difference Prime Objective Time Scale Managers Promotion, Reward Time scale achieving targets determined by the corporate organization. No direct participation in the work, they in fact delegate and supervise work. Entrepreneurs Control over destiny, money Time Scale for achieving targets is determined by the entrepreneurs themselves. Direct involvement in all the activities of the business. Intrapreneurs Freedom to take decisions, reward Time Scale for achieving targets is determined by the entrepreneurs themselves. Direct involvement in all the activities of the business.

Participation

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ENTREPRENEUR Do things that are not generally done in the ordinary course of business Some entrepreneurs become celebritiesothers become ridiculed for their failed dreams. All contribute to the spirit of free enterprise. Evolution Derived from a French word in 17th Century Entreprendre means the individual who undertook the risk of a new enterprise. to undertake. undertake. Entrepreneur is a person who creates an enterprise. The process of creation is called as entrepreneurship. Examples: soldiers of fortune, adventurers, builders, merchants and funeral directors. In the earlier part of 16th century, the French men who organized and led military expeditions were referred to as entrepreneurs. French tradition regarded an entrepreneur as a person translating a profitable idea into a productive activity. It also recognized a rich farmer as an entrepreneur who manages and makes his business profitable by his intelligence and wealth. Definitions Essai sur la nature du commerce en general describes an entrepreneur as a person who pays a certain price for a product to resell it at an uncertain price, thereby making decisions about obtaining and using resources while consequently assuming the risk of enterprise 1755 According to Robert Schwartz The entrepreneur is essentially a visualizer and an actualizer. He can visualize something and when he visualizes it he sees exactly how to make it happen. Peter F Drucker He searches for change, responds to it and exploits opportunities. Innovation is the specific role of an entrepreneur. Adam Smith in The Wealth of Nations, spoke of the enterpriser as an individual who undertook the formation of an organization for commercial purposes. He describes the role of industrialist as a person with unusual foresight who Point of recognize the potential demand for goods and services. could Entrepreneur Manager
Difference

Charms of being an Entrepreneur by setting up an To start a venture

Motive

You will be your You will have a chance to put your ideas into practice. Status Owner of the enterprise You will make money for yourself rather than for others. He is an employee You may participateAn entrepreneur being aspect of of in each and every the owner running manager does not learn and gain a business and bear A experience in a variety of disciplines. all the risks Risk bearing the enterprise assumes any risk involved in the and uncertainty enterprise. To work directly with your customer Personal satisfaction of creating and running a business You will be able to work in a field or area that you really Salary which is certain enjoy. Profits and are directly proportional
Rewards to risk and fixed

enterprise. He understands the venture for boss to others. own boss andhis personal gratification.

To render his service in an enterprise already setup by someone else

Entrepreneur Vs Manager
Innovation He acts as an innovator and also called as change agent Execution of plans prepared by the entrepreneur A manager needs to possess distinct qualifications in terms of sound knowledge in management theory and practice.

Parameshwara.& Qualification P
Qualities

Needs to possess qualities and qualifications like high achievement motive, originality in thinking, foresight, risk bearing ability etc.

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Characteristics of an Entrepreneur Creativity: the ability to bring something new into existence. This emphasizes on ability and not the activity. The creative process for an idea involves five stages Germination: The seeding stage of new idea Preparation: Conscious search for knowledge Incubation: Subconscious assimilation of information. Illumination: Recognizing an idea as feasible Verification: Application or test to prove idea has value.

Innovation: It is the act that endows resources with a new capacity to create wealth. It Innovation: indeed creates a resource. Dynamism: it is potential combination of prosperity. Given the potentialities of the enterprise, he sets attainable goals, which are to be accomplished within specific time frames. Tends to approach problems in pragmatic way. Leadership Team building: Team is a group of individuals with a common purpose, that is focused building: and aligned to achieve a specific task or set of outcomes. Team building skills consists of five stages Wanting to feel better Identifying the problem and needs of the enterprise Creating a vision Setting goals for the group Reviewing progress

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Achievement motivation: Entrepreneurs have a high need for achievement and are guided motivation: by their inner self, motivating their behavior towards accomplishments. Based on this entrepreneurs can be classified as dreamers, doubters and doers. Problem solving: Define the problem Gather information identify various solutions solving: Evaluate alternatives and select best option Take action Evaluate the action taken Goal orientation: Goal setting is the achievement of targets and objectives for successful orientation: performance of an entrepreneur. The goal setting process has three steps: Definition of Goal Specific goals Feedback Target Oriented Goals Achievement Oriented Specific or Primary Overall Goal Secondary goals. Long range / Short range Personal / Social Risk taking and decision making: Entrepreneurs are persons who take decisions under making: conditions of uncertainty and therefore are willing to bear risk. Persons who can take risks and make quick decisions always prosper. Commitment: One of the subtle qualities of an entrepreneur is his will power. Strong Commitment: determination with sound thinking fortifies will power. Functions Idea generation and scanning of the best suitable idea Determination of the business objectives Product Analysis and market research Determination of form of ownership / organization Completion of promotional formalities Raising necessary funds Procuring machine and material Recruitment of men Undertaking the business operations Types of Entrepreneurs Based on Functional Characteristics Innovative Entrepreneur: They introduce new goods or new methods of production or Entrepreneur: discover new markets or reorganize their markets. Entrepreneurs in this group are characterized by an aggressive assemblage of information for trying out a novel combination of factors. Imitative or adoptive entrepreneur: They do not innovate but imitate the techniques entrepreneur: and technology of others. Entrepreneurs in this group are characterized by their readiness to adopt successful innovations by successful entrepreneurs. Fabian entrepreneur: Such entrepreneurs display great caution and skepticism in entrepreneur: experimenting with any change in their enterprise. They change only when there is an imminent threat to the very existence of their enterprise. Drone entrepreneur: Such entrepreneurs are characterized by a die-hard conservatism entrepreneur: and may even be prepared to suffer the loss of business.

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Based on Developmental Angle Prime mover: This entrepreneur sets in motion a powerful sequence of development, mover: expansion and diversification of business. Manager: Such an entrepreneur does not initiate expansion and is content just staying Manager: in business. Minor innovator: This entrepreneur contributes to economic progress by finding innovator: better use for existing resources. Satellite: This entrepreneur assumes a suppliers role and slowly moves towards a Satellite: productive enterprise. Local Trading: Such an entrepreneur limits his enterprise to the local market. Trading: Based on types of Entrepreneurial Business Manufacturing: An entrepreneur who runs such a business actually and produces the Manufacturing: products that can be sold using resources and supplies. E.g.: Apparel and textile products, chemical related products etc. Wholesaling: An entrepreneur with such a business sells products to the middle man. Wholesaling: Retailing: An entrepreneur with such a business sells products directly to the people Retailing: who use or consume them. Service: An entrepreneur in this business sells service rather than products. Service: Based on Nine Personality types of entrepreneurs The Improver: If you operate your business predominately in the improver mode, you Improver: are focused on using your company as a means to improve the world. They run the business with high integrity and ethics. The Advisor: The business personality type will provide an extremely high level of Advisor: assistance & advice to customers. The advisors motto is customer is right and we must do every thing to please them. The Superstar: Here the business is centered on the charisma and high energy of the Superstar: superstar CEO. This personality often will cause you to build your business around your own personal brand. They will be too competitive and workaholics. The Artist: The business personality is the reserved but a highly creative type (E.g.: Artist: Web design, Ad agency). As an artist type you will tend to build your own business around the unique talents and creativities that you have. You may be overly sensitive to your customers response even if the feedback is constructive. Let go the negative self-image. The visionary: A business built by a visionary will often be based on the future vision visionary: and thoughts of the founder. You will have a high degree of curiosity to understand the world around you and will set-up plan to avoid the landmines. Visionaries can be too focused on the dream with little focus on reality. Action must precede vision. The Analyst: here your companys focus is on fixing problems in a systematic way. Analyst: These companies excel at problem solving. The Fireball: A business owned and operated by a fireball is full of life, energy and Fireball: optimism. Your company is life energizing and makes customer feel the company has a get it done attitude in a fun and playful manner. The Hero: You have an incredible will and ability to lead the world and your business Hero: through any challenge. You are the essence of entrepreneurship and can assemble great companies. Parameshwara. P 14

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The Healer: If you are a healer, you provide nurturing and harmony to your business. Healer: You have an uncanny ability to survive and persist with an inner calm. Based on Schools of Thought on Entrepreneurship:

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Model

Focus / Purpose
The entrepreneur has an intuitive ability sixth sense & traits & instincts he is born with Have unique values, attitudes, and needs, which drive them

Behaviors / Skills

Situatio n

Great Person School

Intuition, Energy, Persistence, and self-esteem

Start up

Psychologic al Characteristi cs School

Personal values, risk taking, need for achievement

Start up
Start up & early growth

Classical School

Innovation

Innovation, Creativity and discovery

Management School

Organizers of economic venture; they are people who organize, own, manage and assume the risk.

Production planning, people organization, capitalization and budgeting

Early growth & Maturity

Leadership school

Leaders of people; have the ability to adapt their style to the needs of people

Motivating, directing & leading

Early growth & Maturity

Intrapreneur ship school

It is the development of independent units to create, market & expand services

Alertness to opportunities, maximizing decisions

Maturity and change

Arthur Coles Classification Parameshwara. P 16

Entrepreneurship Development Empirical Rule of thumb (from scratch to 1860) Rational Informed (1860 -1890) Cognitive Sophisticated (from 1980 onwards) Intrapreneur

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They emerge form within the confines of an existing enterprise. In big organizations, the top executives are encouraged to catch hold of new ideas and then convert these into products through R&D activities within the framework of organization. It is also found that an increasing number of Intrapreneurs is leaving their jobs in big organization and is starting own enterprises. Many of them have become exceedingly successful. What is more important that they are causing a threat to the organization, which they left. Entrepreneurship In a conference of Entrepreneurship it is defined as Entrepreneurship if the attempt to create value through recognition of business opportunity, the management of risktaking appropriate to the opportunity, and through the communicative and management skills to mobilize human, financial and material resources necessary to bring a project to fruition. According to A. H. Cole Entrepreneurship is the purposeful activity of an individual or group of associated individuals, undertaken to initiate, maintain or aggrandize profit by production or distribution of economic goods and services. Evolution and Development Entrepreneurship is regarded as closely associated with economic history of India. Accordingly its evolution is traced way back to even early as Rig-Veda, when metal handicraft existed in the country. The important upheavals include decline of handicraft industry towards the end of 18th century, advent of East India Company, Swadeshi Campaign, First & Second World war, partition of undivided India etc. Post Independence, the Govt. took three important measures in its industrial resolutions: To maintain proper distribution of economic power between private and public sector To encourage the tempo of industrialization by spreading entrepreneurship from the existing centers to other cities, towns and villages, and To disseminate the entrepreneurship acumen concentrated in a few dominant communities to a large number of industrially potential people of varied social strata. Role of Entrepreneurship in Economic Development Promotes capital formation by mobilizing the idle saving of the public. Provides immediate large-scale employment thereby reduces unemployment (the root cause for all socio economic problems). Promotes balanced regional development. Helps reduce the concentration of economic power. Parameshwara. P 17

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It stimulates the equitable redistribution of wealth, income and even political power in the interest of the country. It also promotes countrys export trade. It also induces forward and backward linkages, which stimulates the process of economic development in the country. Entrepreneurial Culture What is culture? Culture refers to those learned behaviors characterizing the total way of life members within any given society. In simple, it is the value based practice. An Entrepreneurial culture consists of a group of individuals who have suppressed interests in an effort to achieve group success because group success will advance their individual interests. 11 Secrets for building Entrepreneurial Culture Build parallel interests Be an architect of the future. Be decisive, multifaceted, and ethical to a fault. Know the risk measure the reward. Communication - be a shower not a teller. Power to the people Become a trust builder. Sharing wealth increases wealth. Be constant, consistent and concise. Treat important people like important people. Do simple things simply do them. Stages in Entrepreneurial Process Entrepreneurial Development can be explained in five stages Perceiving, identifying and evaluating opportunity Creation & scope of opportunity Perceived and actual worth of the opportunity Risks and profiles involved in the opportunity Competitors analysis Drawing up a business plan. Executive Summary Concept of the business Management Team Production / Marketing & Sales / Finance Plans Structure and operation Marshalling resources. Creating the enterprise Consolidation and management Critical factors to success Management Style Parameshwara. P 18

Entrepreneurship Development Identify present & potential Problems Implementing a control system Professionalize the management Get into new markets.

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