Entrepreneurship

Entrepreneurial Renaissance
• North America, Asia, and Western Europe
under the grip of an entrepreneurial
renaissance
• Moving away from nations of managers to
becoming nations of owners
• Two decades ago, bigger was better, but
since 1990 smaller has been termed
smarter
• Until 1990, North America’s engine of
growth depended upon Fortune 1000 firms
• Since 1990 the Fortune 1000 have been
declining in total employment because of:
Downsizing
Rightsizing, and
Reengineering
 Small Business Administration of
the US (SBA)
• In 2000, 2,000,000 US firms employed more than 25
people
• But only 15,000companies employed over 500 people
• Firms employing less than 500 people accounted for 40
percent of the GDP
• These firms employed 50 percent of the workforce
• Same firms provided more than 50 percent of new jobs
• During 1990 to 2000, firms that employed less than 500,
created 19 million new jobs
• During the same period firms employing over 500 people
had lost 3.7 million jobs
 a small business
• In America, a small business is defined
as:
1. Any nonfarm enterprise with over 10,000
annual income
2. Less than 500 employees
• In addition to 2,000,000 firms employing
25 to 500 people, 4,000,000 firms
employs less than 25 and yet another
12,000,000 people are self-employed!
 Small business in India
How do we define a small firm in India?

• But the bad news is that:

• 60 percent of all new businesses failed
within their first two years’ of existence
• 70 percent failed within the first 5 years
• Why do that happen
 Entrepreneurial Rewards and
Risks
• Being an entrepreneur or small business manager
satisfies personal needs for:
• Freedom
• Flexibility
• Variety
• Creativity
• Responsibility
• Control
• Authority
• The entrepreneur reaps the fruits of her
labor.
• The entrepreneurial ventures offer rewards
for the entrepreneurs as well as his
employees
• Small firms at the startups, early stages ,
and growth stages have considerable
advantages over working for large
companies
• Large businesses are more oppressive and
political, have more organizational levels,
and lack personal freedom
• Employees do not control their destiny
• because most decisions are made by
groups
• In an entrepreneurial situation, the employee
has number one billing, no the organization
 Strengths and Weaknesses of
Entrepreneurial Ventures
• Entrepreneurs often complain about the
new enterprise’s weaknesses rather than
leverage its strengths.
• For a new enterprise to succeed it should
have a competitive advantage in
operational excellence as found in the
case of Toyota, Dell, Cisco, Intel, etc.
• This would mean that entrepreneurs could
possess competitive advantages like:
• Speed
• Size
• Flexibility
• Personal service
• Information technology
• First or last mover advantage
• They must understand how to compensate
for enterprises' weaknesses or critical
risks such as limited human and financial
resources and lack of diversification, etc.
 Business Environment
• Government
• Technological
• Socio-economical
• Geographical
• Competition
• Suppliers
 Firm’s environment
• Macro environment
• Micro environment
• Relevant Environment
 Industry
• Threat of new entrants
• Rivalry among competing firms
• Bargaining power of suppliers
• Bargaining power of buyers
• Threat of substitutes
 Indian Industry – Tomorrow
• Challenges
1.Advanced technology
2.Energy conservation
3.Rapid automation
4.High productivity
5.Low prices
6.Efficiency oriented privatization
 Future projects

Cost effective
Low capital based
Energy efficient
Use of advanced technology
Pollution and radiation free environment
 Different stages of projects
 Pre-investment stage
 Investment stage
 Operation

How do we identify projects?

How do we generate ideas?