Professional Studies & Enterprenuership

PROFESSIONAL STUDIES & ENTREPRENEURSHIP
SIDBI (Small Industries Development Bank of India)
The small industries development bank of India a wholly owned subsidies of IDBI
is the principal financial institution for promotion financing and development
industries in the small, tiny and cottage sectors and coordinating the function of other
institution arranged in similar activities .SDBI which became operation in respect of
small sector with special emphasis on village cottage and tiny sector. SDBI activities
include refinancing of term loan granted by SFCS/SFDC/Commercial Banks and other
eligible financial instructions and direct discounting and rediscounting bills arising out
of scale of machinery/ capitates equipment components by manufacturers .Term loan
equipment finance to existing well run small scale units taking up technology up
gradation/ modernization. It extends assistance for infrastructure development of
industrial areas under schemes like seed capital equity fund Mahila Udyam Nidhi and
self employment scheme for ex: - Serviceman, SIDB provides equity types resistance
to special target grooms like new promoters, women and ex-serviceman. It provides
resources supports KVIC, NSIC, SSIDC etc and offers technical and related support
service for the development of small sectors.
SIDBI has also created ventures capital fund to encouraged small ventures
with innovative features in the small scale sectors. Effective from 27 th March 2000 the
SIDBI act has been amended to unable transfer of at 61% of SIDB/equity help by IDBI
to public sector financial entities.
SIDO (Small Industries Development Organization)
Established in 1954.
Head Development Commissioner
Work in three states: - Assam, Meghalaya.
This organization was set on in 1954 with development Commissioner as its
head. Its main objects to maintain close relation with the state government and
different organization and institution of control and state level. It has following
important functions: -
1. Co-ordination: - This organization co-ordinates the work relating to the
development of the small scale industries according to the all India policy programs of
various state Government and the programs for the development of large and small
industries.
2. Industrial Development:-This organization suggests a similar pattern for the
whole country. It assists giving technical advice and helps in the procurement of raw
materials and machinery.
3. Industrial Extension Service:-It works for the marketing assistance training to
help the small industries improvement in productivity and the competitive strength.
SFC (State Financial Corporation)
At present more than 20 states financial corporation are functioning except-

Tamilnadu Industrial Investment Corporation which was set up as a joint stock
company in 1949.
KANAK KUMAR ‘KANAK’ E-MAIL – kkkanak@sify.com

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All other corporation been set up under the state financial corporation act-1951.
The SFC’s are the state level agency established for the development of small and
medium industrial units within there respective states. Thus they provides loans and
under writing assistance to industrial units having paid up capital reserves not
exceeding 1 carore .The maximum amount that can be sanctioned to an industrial
concern by SFC is Rs. 30 lacks . The Industrial Development Bank of India (IDBI) has
made a significant contribution towards the share. Capital of the SFC’s more over the
SFC depends upon the IDBI for refinance in respect of term loan granted by them a
part from the above SFC’s also report to temporary borrowing from the RBI, from IDBI
and by the sale of bonds.
IDBI (Industrial Development Bank of India)
IDBI is the apex banking institution in the long term industrial finance set up in 1964
as a wholly owned subsidiary of the RBI. IDBI was declined from the RBI on 16th Feb
1976. When its entire share capital was transferred to the central government
consequently. Its role was also enlarged to enable it to function as the principle
financial institution for coordinating the function and activities of all India term lending
institutions to some extent the public sectors. The activities of IDBI fall in to the
following categories: -
1. Direct assistance to industrial concerns.
2. Refinancing industrial loans granted by banks and other financial
institution.
3. Rediscounting of bills.
4. Assistance to financial institution by way of subscription to their share
and bonds. The IDBI holds the share in the state financial corporation and the
unit trust of India and acts as a holding company for there institutions.
The financing of exports was also undertaken by the IDBI till the
establishment of EXIM bank in March 1982. Besides the share capital of Rs. 25 carores
wholly subscribed by the central govt. The IDBI raises the bulk of its fund from: -
i) Market borrowing by way of bonds.
ii) The borrowing out of national industrial credit (long term operation) fund of
the RBI. IDBI also takes short term advances from the RBI against lodgment of
use once bills.
Consumer Protection Act-1986
The consumer protection act-1948 came into force on 15.04.87. It extends to whole of
India except Jammu & Kashmir. The objective of the act is to provide the consumer a
simple speedy and inexpensive may of redressed of grievances in case of any
deficiency/defect in goods and services brought /used by him for a consideration.
The remedy available under this act is in addition to any other low for the time
being in force.
Q. Who is a consumer for the purposes of this act?
Answer: A consumer can be a consumer for goods or consumer for service. A

consumer is one who buy some goods for consideration for his use or one who uses
such goods with approval of such buyer.
The consumer doesn’t include any body who buys goods uses the same for
commercial purpose. The intention of the act is to restrict the benefit of act to
ordinary consumers purchasing goods for their own consumption and not for large

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scale manufacture or processing activity carried for profit. For the purpose of services,
a consumer is a person who avails of any consideration or any other beneficiary of
such services with the approval of the former.
TCOs (Technical consultancy organizations)
TCOs were set by IDBI, IFCI and ICICI on collaboration with state level financial/
development institution and commercial banks. Presently 16 TCOs are working in the
country. Some of them are covering more than state. TCOs provide assistance in the
field of preparation of project reports and feasibility studies, training of entrepreneurs.
Project implementation rehabitation, management. Consultancy detailed design
engineering and turn key services, energy audit and conservation.
SISI (Small Industries Services Institute)
It has its own— (1) Workshop,

(2) Technical Project and
(3) Training Programs.
The small scale industries development organization function through the SISI
situated one each in all the state. These have full flanged mechanical work shop and
testing laboratory. Mechanical work shop, heat treatment, milling etc. to undertake
the jobs for small scale industries laboratory provides facilities for chemical testing,
analysis of various row materials and testing for strength. Such laboratories and work
shops are situated to the important industries towns. Institutes also offer the technical
service regarding selection installation and layout of machinery preparation of
designs, drawing and model schemes. It provides facilities of on the spot advice
through field visits to the factory sites.
PROJECT
It is a unique venture with a beginning and an end. Under taken by people and
to meet established goals within define constraints 7 time resources and quality. It is
a document that describes the purpose, objectives, scope and deliverables of project.
We can also define project as a planned and goal oriented socio-economic
development activity requiring financial investment or human participation over a
given time. Examples include construction of physical infrastructure the extension of
credit or financing, the diffusion of a new technology, the conservation or
management of natural recourses and human resources development.
A project definition describes exactly the common understanding its extent and
nature, among the key people involved in a project. The definition provides a
foundation upon which successful project are built. In many cases a definition serves
as a sort of contract between the parties participating in a project, clearly stating
expectation for project time resources and result.
In lay man’s language we can say that a project is an idea. A project can also be
started as a plan.
 Phases In Installing A Project
Installing a project passes through different phases depending upon type of project.
For the purpose of study, let us consider that a project passes through following
phases:
 Project Identification
 Project preparation or Formulation
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(a)Preliminary project study
(b)Feasibility study
 Project appraisal
 Negotiation
 Project approval
 Detailed project planning
 Project implementation
1. Project Identification: - First phase of the project is concerned with identifying
project which has high priority, possible to finance the project and the users are
interested in the project. These project must also meet a prima-facie test of feasibility
i.e. it is viable from technical and financial point of view; cost of the project should be
less than the expected benefits.
Project ideas emerge during analyzing problems, conducting macro economic
and social analysis, pressure from local people etc. The project is then identified so as
to provide the basis for appropriate development strategy.
Identification is a mixture of both formal and informal processes.
Following are the four aspects which are examined starting from the
identification stage and continue in greater and greater details during subsequent
stage. These are attended to the extent needed at that particular stage.
i) Functional aspect: - This includes operational and civil structural plans.
ii) Location and site: - This includes climate to epigraphy, environment,
geology, accessibility, infrastructure, hydrology, social economic and
political aspects, availability of water supply, electricity, construction
material, land, labour etc.
iii) Construction aspects: - This includes design technical requirement etc.
iv) Operational aspects: - Project management, maintenance, review and
expenditure, operational safety and health.
For the purpose of identifying the project, a study of various alternatives is
necessary. To assess the merits of alternative proposals, data available with different
agencies are studied thoroughly. Economical aspects of these alternatives should also
be considered. Topographical maps, official records, geological surveys etc are also
considered.
2. Project preparation or Formulation: - This is an important phase and decides
whether the project should be executed or not, project formulation is done following
two phases-
(a)Preliminary project study: - In this phase preliminary information related
to the project are collected and analyzed to help the decision matter to decide
whether it is desirable to apply more resources to take up detailed study.
(b)Feasibility study: - This is a detailed study conducted considering all
relevant elements so as to help the decision maker to decide, whether the project
should be taken up positioned or abandoned.
This is a preliminary report prepared for taking decision whether a feasible
study should be undertaken or not. The report consists of rough determination of the
utility of the project. A rough engineering estimated cost potential funding sources
expected revenues from the project after its completion, broad location etc. this also
indicates engineering and profitability aspects as compared to other similar project
already executed. The data already available with different agencies are utilized in
preparing the report. If the results are clearly unfavorable, further work on the project
is abandoned.
If the results of the report are found to be favorable and taken within the policy
of the govt. further steps are initiated for carrying out the feasibility study. To know
whether the reports in favorable following sectors need greater emphasis:
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 Demand: - Demand estimate are based or satisfying overall national or
regional demand. The regional demand influences the location and size of
the project/projects that will need to be constructed. Existing project or
services need to be considered for knowing the demand & location for the
project.
 Preliminary technical feasibility: - Various alternative ways for technical
and engineering solution are assessed from the point of view of location, civil
structure interlinked with other project & resources etc.
 Alternative Location: - Various alternative locations of the project/projects
or services are given in the report mentioning merits & demerits of each.
 Preliminary economic feasibility: - This is based on comparison with
similar other existing project, if past experience is not available, available
advice of exports can consultants can be sought .The cost of the existing
projects help in deciding the approximate estimate of the project by making
adjustment of the price riseExisting
or otherSystem
factors affecting the price.
Design alternative solution produce (for each soln.)
Cost Benefit Analysis

Cost Benefit Risks
(Consider)
Economic Aspect
Technical Social Aspects
Recommendation and Presentation
Fig:-Project Identification &

Feasibility Study
 Benefit: - The project may be beneficial for the local public or for national or
regional level which help is boosting the production or services or the satisfy
needs.
 Methods of implement: - At this stage it should also be indicated as to how
the project can be implemented and whether the agency has sufficient skill
experience and resources need for implementation.
 Implementation: - Based upon the assessment of different alternatives a
favorable alternative should be recommended giving justification for its
selection.
Feasibility study of the project is the most exhausting of all the planning stages,
as stated above a project is syntactically examined in depth at this stage for various
aspects lime a technical, financial, commercial, social managerial and organizational.
• Feasibility study must consider following point in the report: -
1. Project need or project justification, objectives and goals, Data about the industries
and project in particular.
2. Analysis of existing condition.
3. Demand and supply, analysis and project contribution to feel the gap between
demand and supply.
4. Technical analysis:-Various technical aspects related to the project should be
analyzed the aspects considered \should be process to be adopted. Methods of
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production equipment to be used raw materials, fuel, power and water requirement
.Selection of location and its justification from the point of view of availability of raw
materials transportation, man power etc.
5. Social impact consideration:-Existing social and environmental condition and the
impact of project should be situated and describes in the report.
6. Financial aspects:-Total investment to be made on the project giving break up for
individual major items like land, building, plant and machineries, payment of weighs,
cost of materials etc.
Financial viability of the object is considered by knowing payback, period and
return on environment. Payback period so the no. of years required getting
investment back.
7. Economic aspects: - After knowing the financial aspects the study should indicate
whether the project is economical or not.
8. Implementation details:-The report should give details about implementation,
Administrative arrangement, man power, recruitment details etc.
Point to be included in the feasibility study: -
• Government policy in respect of industry of which the project in under
consideration.
• Specification of the output and technique of production.
• Capacity.
• Alternative location.
• Preliminary estimate of venue, cost, capital and operating.
• Marketing analysis.
• Raw material investigation
• Specification and source of supplier.
• Estimation of material, energy and other I/P cost.
• Requirement of equipment with their type capacity cost and source of
supplier
• Know-how production.
• Site investigation.
Following major aspects are generally considered in the process of project
• Details of building, structure of project, yard facilities with their type, size and
cost.
• Layout.
• Category wise labour requirement and labour cost.
• Resources available to complete the project.
3. Project Appraisal: - Feasibility report is examined by different agencies from
their respective view. The government agencies give more emphasis on socio-
economical aspects while the financial institution will critically examine its technical
feasibility and financial viability along with managerial competence of the
organization undertaking the project.
Project appraisal is the most important phase or the project work,
because it provides a comprehensive review of all aspects of the project and is the
culmination of the predatory work. Appraisal is therefore an analysis ex-anti, all
though the project has not been but into operation. The cost benefit of the project is
estimate to arrive at the decision to take up the project.
Aspect considered for project appraisal:-
• Technical aspects: - It has to ensure that project is soundly designed and
appropriately engineered, appraisal is son for technical alternatives considered.

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• Institutional Aspects:-Institutional appraisal considers whether the entity is
properly organized and its management is adequate to perform the job, whether
local facilities are utilized.
• Financial and economical appraisal: - Financial appraisal is done to engine that
their ox sufficient funds to cover the cost for implementing the project.
• Time Value:-Since cost and benefits don’t technique at the same time. The
project appraisal technique has to reduce benefits and cost to a time dimension.
Time involves sacrifices in the present over the future.
• Investment criteria:-Based on financial and economical analysis. Next setup is
investment decision. This decision is based on the exercise to find out the return
which would be available on capital invested. Investment decisions are taken
considering the following factors:
o Alternative use of resources.
o Life span of the project.
o Whether the project is form individual of form society point of view.
o Cost and returns accruing at different point of time.
• Capital rationing: -- Since resources are generally available in limited quantity
and therefore need to be rationed among competing demands and priorities, in
open market and for a private firm, the funds cone from outside the firm of
project internal resources.
• Environment:--In project appraisal social effects are also taken into account
while considering the implication of projects undertaken either by private or
public authorities such intangible social costs and benefits through not
measurable has an important bearing and hence should be high lighted.
4. Negotiations: - In the next stage of the project cycle discussion take place
between the project authorities and financial institutions/ Government department to
ensure success of the project.
5. Approval of the project: - After going through the stage of project appraisal at
various levels and holding discussion project is approved by the government.
6. Project planning: - Planning a project is very important task and should be taken
up with great case as the efficiency and economy of the whole project largely
depends upon its planning. While planning a project each and every detail should be
worked out in anticipation and should be considered carefully considering all the
relevant provision in advance. The actual construction of the project is some time
called as pre-construction project plan. This helps in effective use of resources and
draws detailed plan of implementation of the project.
Plans are developed and translated into activities and tasks, estimates are
made moue precise and accurate, internal administrative system information system
arrangements for finance are made with the financial institutions for timely receipt of
loans.
7. Project implementation:-Project cycle is actual implementation of the project for
its construction and operation. For proper project implementation, emphasis should be
on action as per planning. For this purpose organization set up and sound project
management system should established so as to manage the project in a rational
scientific manner , during the implementation stage of the project; there is need for
continuous monitoring to ensure project implementation as per time and cost
schedules.
 Detail Project Report

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The detailed project reports cover all the aspects of business from analyzing the
market, confirming availability of various such as plant and machinery, raw materials
to forecasting the financial requirements, the scope of the report includes accessing
market potn, collaborators investment decision-making corporate diversification
planning etc, in a very planned manner by formulating detailed manufacturing
techniques and forecasting financial aspects by estimating the cost of raw material.,
formulating the cash flow statement, projecting the balance sheet . The DRR is
prepared by highly qualified and experienced consultation and the market research
and analysis are supported by a panel of experts and computerized databanks.
Each Detailed Project Report Contains:-
1. Introduction:
i)Beginning
ii) Project introduction
iii) Brief history
2. Market Survey:
i) Present market position.
ii) Expected feature demand.
3. Plant and machinery.
4. Raw materials
5. Manufacturing techniques
6. Personal requirement
7. Financial aspects
Critical Path Method(C PM)
The use of this technique Modern Network System has become very essential in
the developing countries like India. This was developed in 1957 and is suitable for the
construction of project and for scheduling plant maintenance. C.P.M. technique is
useful to determine how best to reduce the time required to program routine
production. The direct and indirect expenses; CPM was first used by the research
team lead by Morgan R. Walker to reduce the time required to perform routine plant
over hauling, maintenance and construction work.
With the help of CPM, a manager can know that which operation should be
started after completing a particular operation and what is the status of the worker as
related to the scheduled timing, although an experienced person knows it but this
information available from the network helps all concerned.
Advantage:-
1) It helps in asserting time schedules.
2) With its helps, control of the management becomes easy.
3) It makes better and detailed planning possible.
4) It encourages discipline.
5) It provides a standard method for communicating project plans schedules and cost
performances.
The C.P.M. technique requires grater planning than require otherwise, thus, this
method increases the planning cost but this can easily be justified by concentration
attention a critical paths only and avoiding unnecessary expenses on the strict
supervision other the whole program.
District Industrial Centre (DIC)

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The government has set up district industries centre at the district level. These
centers provide all the service & all the facility to the entrepreneurs at one place for
sitting up small & village industries. These center renders various service required by
small entrepreneurs including identification of a suitable scheme, preparation of
facility report arrangement for supply of machinery and equipment, provision of raw
material’s credit facilities and inputs, marketing and extension service.
DIC is a district industries headed by a general manager who is assisted by 7
functional managers, each is a specialist in following subject:
1. Economic Investigation
2. Machinery and equipment
3. Raw materials
4. Research extension and training
5. Credit
6. Marketing and
7. Cottage industries
 Role of credit manager:-The credit manager has been deputed by the banks of
the DIC. They provide all guidance, assistance, support required by entrepreneur in
obtaining the right type of credit in required amount at the proper time from banks
and financial institutions.
The credit managers are required to recommend the credit proposals of
small entrepreneurs after due arrival (appraisal) to the credit institutions. The
entrepreneurs are therefore not requiring furnishing the same particulars to the
bank again. The credit manager doesn’t posses the authority to sanction loan nor
are they responsible for the recovery of the loans. They act as liaison authority
between loaner on the one hand and the credit institutions on the other.
The Indian Factory Act (1948)
This act safeguards the interest of workers engaged in factories. The act is now
applicable in whole of India. It comes first into force from 1 st Apr 1949 and was
extended to the union territories of Goa-Daman Div in 1963 and to the state of Jammu
& Kashmir in 1970.
This act has defined following terms:-
1. Adult: - A person who has completed defined age described in the act.
2. Adolcent: -A person who hasn’t completed 15th of age.
3. Child:-A person who hasn’t completed his 15th years of age.
4. Calander year:-A period of 12 months from 1st January.
5. Prime mover:-Any engine motor or other appliance which generates or
otherwise provides power.
 License and Registration:-
1. The act specifies that before a factory can be started:
o Prior permission for the state of the factory construction or extension has
to be obtained from the chief inspector.
o Procedure & specification should have been approved by the factory
Inspector.
o The factory has to be registered and the license-fee has to be paid.
2. If an application for permission referred at item:
o Above accomplished by the plans and the specification required by rules
referred an item.
o Above sent to the state government or the chief inspector by registered
post no order in communicated to the applicant within three months from the

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date on which it is to be sent the permission applied for the said applicatio0n
shall be demand to have be granted.
3. Where a state government or a chief inspector refuse the grant permission to the
site construction or extension of factory or to the registration and licensing of a
factory, the applicant may within 30 days of the date of the date of such refusal is
from the state government in any other case.
 Inspecting staff:-The act permits the state government:-
o To appoint chief inspector and the other inspector to supervise the
condition in factory and to see that provision of the act are practiced.
o To appoint certifying surgeons to examine the condition in factory to the
find out whether any process or action in manufacturing is harmful to cause any
industry to the health of workers.
 Health Provision:-This act prescribes the following provision for maintaining the
health of workers and reducing the possibilities of injuries to their bodies:
o Cleanliness: - Every factory shall be kept clean & free from gases arising
from any drain or their nuisance for their purpose.
o Ventilation and Temperature.
o Artificial and humidification: - If there is an artificial humidification, it
should be of prescribed standard and created by prescribed method.
The water used for such humidification shall be clean and free from dust.
o Lighting: -
(a) Sufficient & suitable lighting whether natural or artificial or both shall be
maintained at the working place.
(b)All glazed windows and sky light shall be kept clean on both the inner and
outer surfaces.
o Drinking water.
o Bathrooms: - If the work in the factory is of such a nature which involves dirt, a
sufficient number of bath-rooms shall be provided.
 Safety provision: -
1. Fencing of machinery: -
a. Every moving part of a prime mover, every fly wheel.
b. Head race and trail race of every water turbine.
2. Work on or near machinery in motion: -The work on or near machinery (moving)
shall be done by a specially trained adult worker wearing tight fitting clothing.
 Welfare provision: -
1. Washing facilities.
2. Sitting facilities.
3. First aid facilities.
4. Welfare facilities: - Welfare officers shall be employed in every factory
employing more than 500 workers. The government may prescribe the duties,
the equalification and conditions of service and number of such officers.
Workers Compensation Act-1923
It is an act to provide for payment by certain classes of employees to their workman

of compensation for injury by accident. Thus this act protects the workers as far as
possible from hardship arising from accidents. The object of awarding compensation is
to replace the actual loss suffered by the workman. It came into force from 1 st July
1924.

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Definition: -Department means any of the following relatives of a diseased workman
namely; a wife, a minor legitimate son and unmarried legitimate daughter or a widow
mother.
Partial Disablement: -This disablement is of a temporary time of accident resulting
in such disablement.
Permanent total disablement shall be demand to result from injuries where the
aggregate percentage loss of earning capacity amounts to one hundred %.of
permanent nature and which he was capable of performing at the
Wages: -It includes any privilege or benefit which is capable of being estimated in
money other than a travailing allowance or any other contributions paid towards
pensions etc.
Workman: - It means any person other than a person employment is of a casual
nature and who is employed otherwise than for the purposes of employer’s trade or
business, who is employed in any such capacity specified monthly wages.
United Nation Industrial Development Organization
It provides developing and under developed countries with advice on all aspect of
industrial policy converted into special agency of UN (united nation) in 1985, Head
office- Vienna (Austria)
Industrial Dispute Act:--
This is an act to make provision for the investigation and settlement of industrial
dispute and for certain other purpose.
(1)Average pay:-
(a) In 3 complete months for monthly paid work-man.
(b) In 4 complete weekly paid work-man.
(c) In full working days for daily paid man.
(2) Award final determination by any labour court, industrial tribunals or national
industrial tribunals.
(3)Employer
(4)Industry
(5)Industrial Disputes
(6)Dismissal of workers
(7)Suspension of worker
(8)Settlement
(9)Strike
(10)Workman
Authorized under the Act:-
(1)Work committee
(2)Conciliation officer
(3) Board of conciliation, IPC193/228
(4)Courts of enquiry
(5)Labour court (Judge) High court or, district session Judge having 3-years
experience)
(6)Industrial tribunals:
(a)Wages (b) Compulsory and other allowance.
(c) Bonus (d) Classification of grades
(7) National tribunals.
Employee State Insurance Act (ESI Act)-1948

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This act provides for certain benefits to employees of factory, in cask of sickness.
Maternity and employment injury and makes provision for certain other matters.
Definition:-
(1) ‘Contribution’ means the sum of money payable to corporation by the principle
employer in respect of an employee and including amount payable by or a behalf of
the employee in accordance with the provision of this Act.
(2) ‘Corporation ’means employees state insurance corporation set up under this Act
(3) ‘Development ’means any of the following relation of a diseased/injured person
namely:
(a) A widow or wholly dependent legitimate or adopted son, unmarried legitimate or
adopted daughter or widow mother.
(b) If wholly or impart dependent on the earning of the insured person at the time of
his death or parent other than a widow mother’
(4)’Employment injury’ means a personal injury to an employee cause by accident
other than occupational disease arising out of and in the course of his employment
being insurable employment.
Contribution: -All the employees in factories and other establishment covered under
this act. The central and state govt. and local bodies give grants to the state govt.
fund. The responsibility of paying the employers and employee share of contribution
is placed on the principal employer. The employee’s share which depends on the rate
of the emoluments is to be deducted from their wages by the employer.
Benefits: - the benefits provided under the act to insured person are:
i. Sickness benefit.
ii. Maternity benefit.
iii. Disablement benefit.
iv. Dependent benefit.
v. Medical benefit.
vi. Funeral benefit.
Adjudication: -
a) Constitution of employees insurance.
b) Power of employee’s insurance court (Has all power of civil court) and may can
Rs.500 as penalties.
The Minimum Wages Act-1946
The concepts of minimum wages first evolved with reference to remuneration of

workers in those industries where the level of wages was substantially low as
compared to the wages for similar type of labour in other industries. An for back as
1928, the international labour conference of international labour organization at
Geneva, adopted a draft convention on minimum rates of wages can be fixed for
workers employed in industries in which no arrangement exist for the effective
regulation of wages and where wages are exceptionally too. The need of a legislation
for fixation of minimum wages in India received an impacts and bill provide for
machinery for fixation and periodical revising of minimum wages was prepared and
discussed at the 7th session of the Indian labour conference NOV-1945. It was
introduce in the central legislative assembly in 11th Apr 1946.
Important provision of the Act
(1) Interpretation
(2) Fixing of minimum rates of wages
(3) Minimum rates of wages
(4) Procedure for fixing and revising minimum wages
(5) Advisory board

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(6) Central advisory board
(7) Composition of comities.
(8) Fixing hours for normal working day.
(9) Wages of worker who works for less than normal working day.
(10) Wages for two or more classes of work.
(11) Minm time rate wages for piece work.
(12) Maintainace of registers and records.
(13) Penalties for certain offence.
(14) Exemption of employer from liability in certain cases.
(15) Power of state government to add schedule: -The appropriate government after
giving by notification in the official gazette not less than three months.
(16) Power of the central government to make rules: -The central government may
subject to the condition of official Gazette, publication by notification in the official
Gazette make rules prescribing the terms of the office members.
The procedure to be followed in the conduct of business, the method of voting,
the number of billing up casual vacancies in membership and quorum necessary for
the transaction of business of the central advisory board.
Industrial Finance Corporation of India (IFCA)
IFCI was the first development bank established in India in the year 1948. Its primary
objective was to assist industry especially when accommodation from traditional
source of finance for the creation of fixed assets was felt inadequate or when
resources to capital market was difficult. IFCI provides assistance to the industrial
concern in the following ways:
1. Long term loans- both in rupee and foreign currencies.
2. Under writing on equity preference and debentures issues.
3. Subscribing to equity preference and debentures issues.
4. Granting the deferred payment in respect of machinery imported from abroad or
purchased in India.
5. Granting of loans raised in foreign currency from foreign financial institution.
Financial assistance may be availed of by any limited company in the public,
private or joint sector or may by a co-operative society in corporated in India, which is
engaged or process to be engaged in the specified industrial activities. Such financial
assistance is available for the setting up of new industrial projects and also for the
expansion diversification renovation or modernization of existing ones. The
corporation also provides financial assistance or concessional terms for setting up
industrial project in industrially loss developed districts in the state/union territories
notified by the central government. The authorized capital of the IFCI (Rs. 22.5crores)
has been subscribed by the industrial development bank of India (50%) and by
scheduled banks, co-operative banks, insurance concerns and investment trusts etc,
by a recent amendment to the IFCI act.
The central govt. has been authorized to raise the authorized capital up to an
amount not exceeding Rs 100crores. The corporation raised its resources by way of:
i. issue of bonds in the market;
ii. borrowing from the central govt. and
iii. foreign credits.
Khadi & Village Industries Commission (KVIC)
The KVIC is established by development of khadi and village industries in a rural area.
The main objectives of KVIC are provision of unemployment of rural areas skill

24
improvement transfer of technology. Rural industrialization and building of strong
rural commodity spread to make the rural people self reliant the significance
characteristics of khadi and village industries under the preview of KVIC are other
ability to use locally available row material, local skill, local market, low per capital
which can be easily adopted by the rural people short gestation period and above
production of consumers goods. KVIC activities have now reached over 2.35 Lakhs
villages in country providing gainful employment opportunity to the rural people. The
wide ranging activities of KVIC include procurement of row materials. KVIC
implements its development programs through 30 states. Khadi and village industries
board which are statuary organization setup under state legislation. 3500 industries
are registered under society registration act 1860 and over 30,000 co-operative
societies are registered under state co-operative act.
KVIC also assists individual entrepreneur through state khadi and village
industries.
Industrial Credit And Investment Corporation Of India (ICICI)
The ICICI was setup as a joint stock company in 1955, with the objectives to
channelise the World Bank fund to industry in India and to help to build up a capital
market. Initially all its capital was held privately by companies instruction and
individuals, but today a very large parts its equity capital is held by public sector
institution such as banks, LIC, GIC and its subsidiaries as a result of subsequent
natinalizat8ion of these institution.
The most significant feature of ICICI’s operation is the foreign currency loan
sanctioned by it. Foreign currency loans are sanctioning half of its total disbursement.
This has been possible because of the facility it enjoys of raising funds the for3eign
currency. The World Bank has been the single largest source of such resources. The
ICICI also raises fund from UK, KFW and DMPF. Since 1973, the ICICI has entered the
international capital market also for raising foreign currency loan. The major portion of
its debentures is the capital market.
The ICICI also borrows from the Industrial Development Bank Of India and the
government. The major portion of its assistance has gone to the private sector, while
it also lays emphasis on financing project in the backward class. The ICICI has also
contributed to the growth of the capital market by under writing of corporate
securities and by directly investing in such securities. It has built up a full-fledged
merchant banking division which provide advisory services in financial matters to the
corporate sector.
Export And Import (EXIM) Bank
The Export Import Bank Of India is the latest apex banking institution in India setup on
the 1st January 1982. The EXIM Bank provides financial assistance to importers and
function as the principal financial institution for co-ordination. The working of other
institution engaged in financial of export and import of goods and service. It provides
refinance facilities also to the commercial bank and financial institution against their
export-import financial activities. The function of the EXIM bank includes:
1) Financing of export from and import in to not only India but all countries
for goods and services.
2) Financing of joint ventures in foreign countries.
3) Financing of export and import of machinery and equipment on lease
basis.

24
4) Providing loans to Indian so as to enable it to contribute in the share
capital of a joint venture in a foreign country.
The bank also undertakes limited merchant banking function such as under
riding of stocks shares bonds of companies engaged in export or import and providing
technical administrative and financial assistance to parties is conception with export
or import. The authorized capital of the bank is 200 carore paid up capital Rs. 50
carore subscribed by the central government which would also grant among 20
carores to the bank. The bank analyzes resources from:
a) The open market through the issue of bonds and ventures
b) From RBI from its national industrial credit (Long term operation).
c) Can borrow foreign currency in or outside India. Entire business of the industrial
development bank of India relating to export financing has been taken over by the
EXIM bank.
EXIM bank operates three broad programs of financing loans re-discounting and
grantage as present running programs are operated by the bank as follow:
A) Loans to Indian companies are provided under its
1. Direct financial assistance to exporters.
2. Technology and consultancy services.
3. Overseas investment financing for equity participation by an Indian company in
joint venture abroad.
4. Pre-shipment credit in case of contract for capital goods.
B) Loans to foreign government, companies and financial institutions are provided
under its:
1. Overseas buries credit scheme.
2. Lines of credit to foreign govt.
3. Re-landing function to bank overseas.
C) Loans to commercial bank in India are available under:
1. Export billing.
2. Re-discounting scheme (short term bills).
3. Refinance export credit guaranty programs is available in case of construction and
contracts.
IBRD (World Bank)
International Bank For Reconstruction And Development (IBRD)

It was founded at the international Economic Conference held at Bretton woods
in July 1944 and began its operations in June 1946.Its aim is to assist the Economic
development of its member countries and to raise the standard of living of the people
of the world. The purposes of the Bank set forth in the articles of agreement which are
to assist in reconstruction and development of the territories of the members
facilitating investment by means of guaranties or participation in loans and to
promote the long range balanced growth of international grade and maintenance of
equilibrium in balance of payment. The Management of the World Bank is like IMF
(International Monetary Fund) all powers are vested in a board of governors. The
granting of loans is in four stages:
a) At the first stage discussion about borrower’s repayment capacity
is done and bank sends a mission to study of country agricultural,
mineral and industrial resources position.
b) Second stage investigation about the specific projects starts.
c) At third stage negotiation of the terms of the loan begin.
d) 4th stage is the administration of the loan was and use is verified.

24
The guiding principles of the bank are that it assesses the repayment
prospects of the loan lends only for specific projects which are economically and
technically sound and or high exchange content of the project cost and maintains
continuing relation with borrowers so as to check the projects and keep in touch with
the financial and Economic Development is the borrowing country.
NABARD (National Bank for Agricultural and Rural Development)
It is fond in 1982. The National Bank for Agricultural and Rural development
(NABARD) is the apex development bank for agriculture and rural development. It was
set up on 12’th July 1982 by merging the Agriculture Credit Development and Rural
planning and credit cell of RBI(Reserve Bank of India )and the entire undertaking of
Agriculture Refinance and Development Corporation.
NABARD has been entrusted with three types of function, namely:
(1)Credit function:--It provides through the banking system all kinds of
productive and Investment credit to agriculture small scale Industries cottage and
village Industries, handicrafts and other allied Economic activities. It provides different
types of Refinance i.e. short term, medium term and long term to eligible institution
namely (a) State Co-operative Bank (b) Regional Rural Bank (c) State Land
Development Bank (excluding short term) (d) Commercial Bank; only long term and
other financial institution approval by the Reserve Bank.
NABARD has prescribed lower rates of Interest on the Refinance
provided by it and the rates payable by the ultimate borrowers.
(2) Development function: NABARD coordinates the operation of rural credit
agencies develops expertise to deal with Agricultural and Rural Problems assists
Government. Reserve Bank and other Institution in Rural Development efforts acts
agent to Government and Reserve Bank in relevant areas. It provides facilities for
training and research assists. The state Government enables them to contribute to
the share capital of eligible Institution.
(3)Regulatory Function: The Banking Regulation Act 1949 empowers the
NABARD to under take inspection of Regional Rural Banks and Cooperative Bank
(other than primary co-operative Banks) if any such Bank seeks permission of the
Reserve Bank for opening branch etc. It will have to obtain the recommendation of
NABARD
Resource: The paid-up capital of NABARD is Rs. 1000 crores at present contributed
equally by the Government of India and the Reserve Bank besides the National Rural
credit fund, the NABARD is authorized to raise resources by issue bonds and
debentures guaranteed by the central Government and also to borrow from the RBI,
Central Government and any other organization approved by the central Government.
It can also raise funds externally through the Government of India.
Organization:
NABARD is managed by Board of director comprising of the chairman,
Managing Directors, experts in Rural Economics, experts from co-operative Banks,
three Directors of the Reserve Bank, three directors from Govt. of India and the
representative the state Government.
BUSINESS MANAGEMENT
DUTY:--“Expected action is duty.”

Obligation: - “Knowledge of expected action is obligation.”
Profession:--“Profession is a kind of vocation. It carries with specialized knowledge
and skill the person has acquired.”
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Professional ethics are:
1) Personal morality.
2) Positive and creative thinking.
3) Social and moral obligation.
4) Commitment to profession
5) Maintenance of professional standards.
6) Observance and professional studies code & conduct.
Entrepreneurship:  “Producing new thing of old one in new form is
entrepreneurship.”
Utility: -- Consumption is the destruction of utility.
Factors of production: --
i. Land
ii. Labour
iii. Capital
iv. Enterprise
v. Organization
#All professions are occupation but all occupation are not professions.
MANAGEMENT
Management is according to:

1) F.W.Taylor (Fredrick Winslow Taylor): - “management is knowing exactly what
you want men to do and then seeing that they do it is cheapest and best way”
2) Peter F. Drucker: -“Management is a multipurpose organ that manages a
business, manages managers and manages workers and work.”
3) Henry Feyol: -“To manage is to forecast, to plan, to organize, to command, to co-
ordinate and to control.”
**Function of Management
# (1) Planning,
# (2) Organizing,
# (3) Staffing,
# (4) Directing/leading,
(5) Supervising,
(6) Co-ordination,
# (7) Controlling,
(8) Reporting,
(9)Budgeting and
Communication.
NOTE Universal expected function is mainly of five types which are indicated by
hash (#) sign.
Q. WHAT DO YOU MEAN BY MANAGEMENT AND WHAT IS THE FUNCTION OF

MANAGEMENT?
ANS.  Management has been defined in various ways by different management
experts. As a result, there is not a single definition on the term but many.
Following are the few of the important definition of management:-
In the opinion of F.W.Taylor (Father of scientific management);
“Management is knowing exactly what you want main to do and then seeing that they
do it in the cheapest and best way ”.
In the opinion of Peter F.Drucker, defined management as saying; “Management
is a multipurpose organ that manages a business, manages managers, and manages
workers & work”.
24
According to Henory Fayol, Who is consider as the father of principles of
management; “To manage is to forecast, to plan, to organize, to command, to co-
ordinate and to control ”.
Having gone through the above definitions of management, we come to the
conclusion that management is getting things done through others in the best
possible way or we can say that it is a process of various functions like planning,
organizing, staffing, leading and controlling the business organization, in such a way
as to achieve the objectives of the organization.
FUNCTION OF MANAGENENTS:
Many management experts have discussed the functions of management in
their own ways. The chief reason for this is their experience in an organization.
However, all the functions listed by different management experts are broadly
classified into five main functions by Harold Koontz and O’Donnel. They are as
follows:--
i. Planning: In simple words, planning means thinking before doing. It involves
selecting mission and objectives and the actions to achieve them. It is today’s
projection for tomorrow’s activity. It involves decision making as to what is to be
done; how it is to be done; when it is to be done; by whom it is to be done and so on.
Thus planning includes determination of objectives, setting rules and procedures,
determining projects, policies and strategies etc. It is very much involved in
organizing, leading, motivating and controlling. The importance of planning lies in the
fact that it ensures smooth and effective completion of activity, whatever it may be
.The efficiency of planning is measured by the amount it contributes to purpose and
objectives as set by organization.
ii. Organizing: The purpose of organizing is to aid in making objectives
meaningful and to contribute to organizational efficiency. To includes bringing
together man, money, machinery and material and other things to execute plans.
When these resources are assemble then the enterprise comes into life Organizing
involves deciding activities , grouping of these activities in form of positions, grouping
of various positions in to departments, assigning such positions to the managers and
delegating authority to each manager to accomplish the work in a planned manner.
iii. Staffing: The purpose of staffing is to ensure that the organizational positions
are filled by qualified and able man-power. Staffing function includes requirement to
man-power, source of man-power, their selection, training and development.
Remuneration and periodic appraises of man-power working in the organizational
enterprise. It is clear that staffing must be closely linked with organization.
iv. Leading: The organization of leading on direction is defined as the process of
influencing people so that they will contribute to organization and its goals. The
functions like planning, organizing and staffing are merely preparation for doing the
work, the leading function actually starts the work leading involves telling the
employees, what and how they have to do. Once, the employees are oriented to their
jobs. They need continuous guiding, communicating, motivating and normal boosting.
v. Controlling: Controlling means to see, where the activities have been or
being performed in conformity with the plans or not. Thus, controlling is comparison of
actual results with the targets and objectives identification of variations between the
two.
In short, controlling facilitates the accomplishment of plans.
Now, it becomes clear that the management process involves a group of functions
on a continuous basis. It can’t function separately. In fact, all these functions are
interrelated in such a manner that every next function depends upon the completion of
the earlier work.
* Role: What is expected action of duty about a person is his/her role.
24
Q. Discuss the role of manager?
Ans Types of role of manager according to Mintz-berg:-
1) Inter personal role :
a) Figure head
b) Leader
c) Liaison
2) Informational role:
a) Monitoring Role
b) Disseminator Role
c) Spokes Man
3) Decisional Role:
a) Entrepreneur
b) Resource allocater
c) Negotiator
d) Trouble handler/disturbance handler.
According to Mintz-berg; role refers to the expected behaviour of the occupant of
the position not all their behaviors. He has pointed out that there are three categories of
roles that a manager performs in an organization. These are given above. Details are as
follows:
1) Interpersonal Role: Interpersonal role of a manager is concerned with his interacting
with other persons both the organizational members and outsiders.
There are three types of interpersonal role. They are:
a) Figure head,
b) Leader and
c) Liaison.
In figure head role, the manager performs activities which are of ceremonial and
symbolic nature; these include greeting the visitors, attending social functions handing-out
merit certificates and other awards to outstanding employees. Role of manager as a
leader involves leading his sub-ordinates and motivating them. In Liaison role, the
manager serves as a connecting link between his organization and outsiders or between
his unit and other units or between subordinates and higher.
2) Informational Role: Information role of a manager includes communication giving and
receiving information both within and outside the organization. There are three types of
informational role of a manager. They are:
a) Monitoring Role,
b) Disseminator Role and
c) Spokes-Man.
In his monitoring role, the manager constantly collects information about those
which affect his activities. In his disseminator role, the manager distributes information to
his subordinates, who may, otherwise not in a position to collect it. As a spokes-man, the
manager represents his organization or unit while interacting with outsiders. These may be
customers, financers, Government, supplier or other agencies of the society.
3) Decisional Role: Decisional role of a manager includes choosing the most appropriate
alternative out of the available ones. In his decisional role, the manager performs four
roles:
a) Entrepreneur,
b) Resource allocater,
c) negotiator and
d) Trouble handler/ disturbance handler.
As an entrepreneur, the manager assumes certain risk as disturb-handler. The manager is
required to contain those forces and events, which tend to disturb the organizational
equilibrium and normal functioning. These forces may be shortage of raw-material,
24
employee’s complaints, grievance and strike by the employees etc. As resource allocater,
the manager allocates resources such as human, financial equipments etc to various units
according to their requirements. As Negotiator, the manager negotiates with various
groups in the organization and outside the organization such as sub-ordinates, share-
holders, outside agencies etc.
* Doing something new or doing old one in a new way or doing a job bearing risk is
Entrepreneurship.
Leadership
According to Lapiere and Farmsworth, “Leadership is the behaviour that affects

the behaviour of other people more than their behaviour affects that of the leader”.
According to Koontz and O’Donnel;“ Leadership may be defined as the ability to
exert interpersonal influence by means of communication towards achievement of goal”.
Types of Leadership:
1) Autocratic leadership;
2) Democratic leadership and
3) Laissez-faire Leadership.
Functions of Leadership:
1) The leader as guide;
2) The leader as planner;
3) The leader as disciplinarian;
4) The leader as coordinator;
5) The leader as morale booster;
6) The leader as supervisor;
7) The leader acts as external group representating;
8) The leader as surrogate of individual responsibility.
Qualities / Characteristics /Traits of A Successful Leader:
A) Human relation awareness;
B) Intelligence;
C) Empathy (i.e. seen the situation of problem from other point of view);
D) Managerial skill;
E) Emotional stability;
F) Objectivity;
G) Firmness;
H) Alertness;
I) Communicative skill;
J) Unity of mutual interest and
1) [
*According to Hollingsworth; IQ- level difference betn leader and workers may not be
exceed than 30.
*According to William James; “Under the positive motivation, 80 to 90% capacity of work
is done by a worker in an organization”.
Career Needs:
I. Top management
II. Middle management
III. Fore line management
Each management has:
i. Conceptual skill
ii. Human relation skill and
iii. Technical skill

24
Q. What do you mean by career needs? Discuss the career needs of a
technician /supervisor/foreman.
ANS.  In order to perform, the duties of a technician effectively, he must have
certain skills. These skills are known as the career needs of technician. Skills refer to
expertness mental ability to understand, to guide, to plan, to take decision etc while
working .So; in short, we can say that the ability and skill which a person must have
for doing a certain type of work of job is known as career needs of that field.
Career needs of a technician / supervisor:
A technician is successful when he is able to make a smooth functioning of
people working under him, he is expected to guide, to plan, to motivate the workers,
so that they may be able to use machines and materials in the best possible way to
achieve the organizational goals. For this, he must use the various skills in appropriate
degrees.
We can classify the skills needed for a technician into the three following
categories:
They are :--( 1) Technical skill
(2) Human relation skill and
(3) Conceptual skill
Though, these skills are interrelated, but the proportion or relative significance of
these skills varies with the three levels of management.
Let the significance of these skills, we discuss one by one:
1. Technical skill: Technical skills are concerned with what is to be done. These
skills refer to specialized knowledge in methods of handling, techniques of specific
job and processing works etc. These skills are most important at lower level of
management and processing works etc. These skills are most important at lower
levels of management and much less important at upper levels. A production
supervisor in a manufacturing organization must know the processes used during
production of a certain item. In most cases, technical skills are important at this
level, because technicians are expected to train their workers in work related
machines, tools and equipments.
2. Human relation skills  These are based on humanitarian approach. These
skills are needed to communicate effectively. The way for effectively
communication is to be sensitive towards receiver’s needs, feeling and
perceptions. The knowledge of how workers behave and how they react in various
situations is quite meaningful for a supervisor. By his human relations skills, a
technicians gain the confidence, co-operation and loyalty of his workers.
3. Conceptual skills  These are concerned with, why a work is to be done. These
skills are the ability to see the organization as a whole to recognize
interrelationship among different functions of the organization. Conceptual skills
are used for abstract thinking and for the concept development involved in
panning and strategy formulation. Conceptual skills involved the ability to
understand how the parts of an organization depend on each other. These skills are
much less important at lower level of management and most important at upper
levels.
In short, we can say that the persons at various levels of management
perform the functions of management in varying degree. The level of skills require at
different managerial levels are different. Technical skills are essential for lower level
of management whereas, conceptual skills are important for top management. Human
relations skills are important at all levels of management.
Q. What do you mean by leadership? Discuss the characteristics

/features/qualities / traits of a successful leader.
24
ANS. → Human beings are the most precious part of an organization. Effective
utilization of the capacity of human resources depends on management. Management
gets the result of human resources through its leader. Leadership is the process of
influencing the behavior of others to work willingly and enthusiastically for achieving
pre-determined goals.
Lapiere and Farmsworth have defined leadership as saying, “Leadership is the
behavior that effect behavior of other people more than their behavior affects that of
the leader”.
According to Koontz and O’Donnell; “leadership may be defined as the ability to
exert interpersonal influence by means of communication towards achievement of
goal”.
Having gone through the above definitions, we can say that, leadership is the
process of influencing others to act in a way that will accomplish the objectives of the
organization.
CHARACTERISTICS:
A leader should have some leadership qualities in order to provide effective
leadership. The important qualities of a successful leader are as follows:-
(1) Human relation: A successful leader should have adequate knowledge of
human relations. Since an important part of leader’s job is to develop employees and
get their voluntary co-operation for achieving goal, he should have intimate
knowledge of employees and their relationship to each other. The knowledge of how
human beings behave and how to react to various situations is quite meaningful for a
leader.
(2) Intelligence For leadership, higher level of intelligence is require. Intelligence
is generally expressed in term of mental ability. In psychological term, it is called I.Q.
A successful leader needs to have high level of intelligence in comparison to his
subordinates.
(3) Objectivity: Objectivity implies that what a leader does should be based on
relevant facts and information. He must asses the situation without any bias or
prejudice. The leader must base his relationship on objectivity. He is objective and
doesn’t permit himself to gate emotionally involved to the extend that he finds it
difficult to make an objective diagnosis and increment the action require.
(4) Emotional Stability: A leader should have high level of emotional stability. He
should be free from bias. He is well adjusted and has no anti-social attitude. He is self
confident and believes that he can meet most situations successfully.
(5) Empathy in interaction: Empathy relates observing the things or situations
from other points of view. The ability to look at things objectively and understanding
them from others point of view, is an important aspect of a successful leadership.
Empathy requires respect for others, their rights, beliefs, values and feelings.
6) Technical skills: A successful leader must have technical skills. Technical skills
are the ability to plan, the ability to process, organize, delegate, analyze, seek advice,
take decision, control and win co-operation. The technical competence of a leader
wins the support of followers.
(7) Alertness: A leader should have high level of alertness. He should have proper
and current knowledge about, what is happening in an around his administrative
arena. It is said, “Alertness gone; danger signal ON”.
(8) Communicative Skills: A successful leader knows, “how to communicative
effectively”. Communication has grade force in getting the acceptance from the
receivers. A leader uses communication skillfully for persuasion and stimulation
purposes. Normally, a successful leader is extrovert.

24
(9) Firmness: A successful leader takes each and every related thing in his
consideration before taking any decision. So, he doesn’t fluctuate from his decision
and remains firm on his stand.
(10) Unity in mutual interest: In his studies, George Robert Terry found that
there should be unity in mutual interest between leader and the subordinates. Their
interest should not be contradictory to each other; otherwise it will create
misunderstanding among them, dispute may arise and peace may be disturbed.
(11) Motivating Skill: A leader must have the requisite quality to motivate his
sub-ordinates. Though, there are many external forces which motivate a person for
higher performance, but there are inner drives also which force people to work. The
leader can play active role in stimulating these inner drives for work.
MOTIVATION
Q.  Define motivation? Discuss the important type of motivation.

Ans  Motivation is one of the most important factors affecting human behaviour and
performances. It is an effective instrument in the hands of a leader for inspiring the
work force. By motivating the work-force, management creates will to work, which is
necessary for achievement of organizational goals. Michel J. Jucius has defined
motivation as saying “Motivation is the act of stimulating some one or oneself to get a
desired course of action or to push the right button to get a desired reaction”. Scott
has also defined motivation. In his own words; motivation means, “A process of
stimulating people to action to accomplish desired goals”.
From the above definition we come to the conclusion that, motivation is
something either internal or external that stimulates a person into action and
continues him in the course of action enthusiastically.
Types of motivation:-The following are the important types of motivation:
(1)Internal motivation: It may be defined as internal earge or drive or force which
stimulates a person for doing any work. It is an inner state and varies form man to
man. It is based on the nature of the man.
(2) External Motivation: External motivations are various types of facilities or
punishments which are available in an organization.
Types of external motivation:-
(a) Positive external motivation: Positive motivations are based on various
facilities, which may be physical or psychological. For example, pay, promotion,
appropriate reward, bonus, DA, Conducive and harmonious work-place etc.
(b) Negative Motivation: It are those motivations which are based on fear or
force. e.g. pay-cut, demotion, censure, warning, lay-off etc are negative motivations.
TYPES OF POSITIVE MOTIVATION:
(1) Financial motivation: Financial motivations are those motivations,
which are directly or indirectly associated with monetary rewards. The
most important financial motivations are pay, D.A., bonus, free medical
facility, insurance, profit sharing, retirement-benefits etc.
(2) Non- financial Motivation: It is those, which are not based on
monetary rewards. Prize, participation in management, job rotation,
delegation of authority recognition etc are the examples of non-financial
motivations.
IMPORTANCE OF MOTIVATION IN AN ORGANIZATION:-
The importance of motivation is an organization may be summed up as follows:-
(1) Reduces the gap between to work and willingness to work:

24
A man may be physically, mentally and technically fit to work or may have
capacity to work, but he may not be willing to work. Motivation minimizes the gap
between capacity to work and willingness to work. In a study, William James found
that motivated employees worked at close to 80 to 90% of their ability to work. The
high performance is a must for an organization performance is a must for an
organization and this performance is a must for an organization and this performance
is must for an organization and this performance comes by motivation.
(2) Reduces labour turn-over and absenteeism:
Motivated employees stay in the organization and their absenteeism remains
quite low. High turn-over and absenteeism create many problems in the organization.
Recruiting, training and developing large number of new personnel into a working
team take years. In a competitive economy, this affects the reputation of the
organization unfavorably.
(3)Acceptance of organization changes: The world economy is moving very fast.
Everyday some new products are coming in the market. Due to changes in the
society, their liking and changes in technology, organization has to incorporate those
changes to cope-up with the requirement of the time. When these changes are
introduced in the organization, there is a tendency to resist those changes by the
employees. However, if they are properly motivated, they accept, introduce and
implement those changes keeping the organization on right track of progress.
(4) Sense of belonging: A proper motivation scheme promotes closer rapport
between management and workers. The workers begin to feel that the organization
belongs to them and consider its interest as their own.
(5) Basis of co-operation: Efficiency and o/p are increased through co-operation.
Co-operation couldn’t be obtained without motivation. Motivation prepares the
ground for mutual understanding and co-operation.
(6) Other Reasons: Productivity, etc.
Q.  What is Professional Ethics? Discuss the main aims an objectives of
Professional Ethics.
Or,
What do you mean by Profession? Discuss the objective of Profession.
Ans -> Profession is a kind of vocation. Which carries with it a specialized knowledge
and a skill the individual has a acquired. Professionals render their specialized service
to their clients in return for a pre-determine fee. Services rendered by doctors,
lawyers, charted accountant etc. ask the examples of Professionals. Every profession
has its own professional ethics. Professional ethics is nothing but certain moral and
ethical rules of that is nothing but certain moral and ethical rules of that profession.
The need for ethical cords arises because of the fact that occupations whose
practitioners have mastery over an area of knowledge have a degree of power by
virtue of their expertise. This has resulted in most of the occupations issuing a code of
ethics of professional practice. So that clients may know the standard and
commitment of that profession. The professional ethics is formulated by the apex
body of that profession as for example Indian Medical Council for Medical Practicener,
BCI (Bar Council of India) for Legal Practicener etc. It is specialized moral laws or
ethical rules which the members of that profession is bound to obey.
The following are the objectives of Professional Ethics: -
1. Personal Morality – The first and foremost object of professional ethics is to
develop personal morality among its members. Truth, Character, Duty,
Responsibility, Integrity, Compassion, Manner, Excellence, Efficiency, Love,
Sympathy etc. are the examples of personal morality.
2. Positive and Creative Thinking – Professional Ethics develop Positive and
Creative thinking among its members. Individual thinking may either be creative or
24
destructive. Positive and Creative thinking is beneficial for individual and society.
So the thinking of a Professional should be Positive and Creative.
3. Social and Moral Obligation – Man is a Social animal. Man cannot live without
society. Society serves us from cradle to grave. We all are owe to the society.
Professional Ethics direct its members to be Honest, Loyal, Sympathetic and Co-
operative towards society. They should keep social interest in heir mind while
charging fee.
4. Commitment to Profession – Profession provides means of livelihood to its
members. Ethical code provide the behavioral pattern for professional. These
concepts suggest that the professional should be committed to their profession.
5. Maintenance of Professional Standards – For every Profession some ethical
standard are provided and every individual of the profession is expected to
maintain conformity with those standards.
6. Observance of Professional Code of Conduct – It is expected from the
members of the profession to observe the professional code of conduct. Violation
of profession code of conduct is punishable.
• Some Important Questions and their solutions:
Q No. 1. What do you mean by Departmentation and what are the bases of
Departmentation?
Ans – Bases: -
1. On the Basis of work function
 Personal
 Finance
 Marketing
o Sales
o Purchasing
o Advertisement
 Product
2. On the Basis of Process
 Spining Department
 Dying Department
 Weaving Department
 Finishing Department
3. On the Basis of Timings (Shift wise)
4. On the basis of Product
Q No. 2. What is the Strike and its causes?
Ans – Causes: -
1. Due to Unsatisfaction/Cause related to Finance
2. Cause related to Management
3. Political reasons
Q. What do you mean by Supervisory Management? Discuss the role of a

Supervisor/Technician/Foreman in an Organization.
24
Ans: Supervisory management is above operatives or workers and below the middle
management. He is concerned with explaining the views of management to workers and
views of workers to management. This is why; the job of a technician becomes more
complex than other level of management.
Management treats him the man of workers while workers treat him the man of
management. A technician or a foreman plays three types of roles in an organization.
They are:
1. Functional role
2. Human relation role and
3. Management role.
1. Functional Role: -In functional role a technician performs the following works:-
a. Trainer: -- Since a technician is responsible for the effective performance of
operatives/workers, put under him he must have through knowledge of the
technical aspect of the job being performed by the workers. Though, the
technician doesn’t perform the job himself. However, he is expected to
determine appropriate method of work. Since, many workers may be raw or
un-skill, a supervisor has to perform their job effective.
b. Analyzer: -- As an analyzer, a technician analyzes different aspects of the
job to achieve efficiency in work operations through division of work or
division of labour though he may get assistance from expert such as
industrial engineers in job analyst; but he should be well convergent with
the operations and division of work.
c. Planner: --In performing the role of a planner a technician is expected to
formulate operational plans for workers i.e.; what is to be done; how is to be
done; when is to be done; etc. He establishes production schedules and
procedures to get the work-done in time.
d. Coordinator: -- As a planner, a technician decides what, how, when the work
is to be done. As a coordinator, he decides who will do what? He brings
workers, machines, materials and jobs together and coordinates them for
smooth and orderly functioning. His role as coordinator may be compare as
a clarinet player of an orchestra-party who brings into playing each
instrument act right moment to produce a melodious music.
2. Human Relation Role: A technician is required to perform human relations
role more effectively because, he is directly connected with the workers and work.
His human relation roles are as follows:-
a. Human Relation Expert: - A technician is treated as a human relation expert,
because he serves as a negotiator, buffer man, communicator and that when
the supervisor looks at the problem of workers from their point of view, there is
a less chance of misunderstanding.
b. Consular: - A technician is required to provide counseling of his workers
compromiser. So, he has a developed a good relations with management and
workers. As, he is generally not treated as a member of any one of two groups.
For example, Management and workers.
c. Empathy interaction: - Empathy means observing things or situations from
others point of view. It requires respect for others. In short, we can say. At work
place many problem arise. These problems may be related to the work or work
environment or even personal matters of workers. A good technician observes
the problem patiently and advice workers as to how they can overcome these
problems.
3. Management role: - In management role, a technician performs the following
roles: -
a. Leader: - As a leader, a technicians required to guide his workers represent
the workers and supervise their work. Every management wants to get the
work done in time. So, a good technician not expected always relay on
24
formal authority to get the work done. But, influences the workers by his
personal skill for better performance. Though, a technician has a choice
either to adopt task-oriented or people-oriented style, but a good technician
always prepares an appropriate mixture of the two according to the need or
requirement.
b. Linking-Pin: - A technician functions as a linking-pin between management
and workers, as he is known as a person in the middle. In such a situation a
technician has to satisfy the needs of management as well as the workers.
In addition, he has to serve as a connecting link between the organization
and outsiders or between his unit and other unit of the organization.
c. Motivator: - Acting as motivator, is one of the most important role of a
technician. He has to motivate those workers also, who don’t want to work
with zeal and enthusiasm. They may have even negative feeling about the
organization in such situation; the role of motivating those workers is a
challenging work. In order to perform this role, a technician must
understand the worker fully and create a work environment which provides
satisfaction to them.
d. Controller: -A technician works as a controller which involves evaluation of
work performance of his sub-ordinates/workers. If things go wrong, he takes
suitable remedial action including reward and punishment.
Q. What do you mean by recruitment and selection? Differentiate between recruitment
and selection.
Ans: Recruitment is the process concerned with the identification of sources where the
personnel can be employed and motivate them to offer themselves for employment.
W. B. Werther and Keith Davis have defined recruitment as follows “Recruitment is
the process of finding and attracting capable applicant for employment. The process
begins when new recruits are sought and ends when there applications are submitted.
Thus, Recruitment process is concerned with identification of possible sources of
human supply and tapping them.
Selection: Selection is defined as choosing the fit and rejecting the unfit. In Indian
context, there are more candidates, who are rejected than those who are selected in most
of the selection process.
Thomas H. Stome has defined selection as “Selection is the process of
differentiating between applicants and order to identify those with a greater likelihood of
success in a job.”
Thus, Selection is the process of finding suitable person from many applicants for
placement. Total process of acquiring and placing selection falls in between recruitment
and placement.
• Difference between Selection and Recruitment :-
On the following basis, recruitment and selection may be differentiated:
i. Objective: - The ultimate objective of both recruitment and selection are to acquire
suitable candidates, but there immediate objective differ. The basic objective of
recruitment is to attract maximum number of so that, more options are available. The
basic objective of selection is to choose the best out of the available candidates.
ii. Process: - Recruitment differs from selection in terms of process. Recruitment
adopts the process of creating, application pool as large as possible where as, selection
adopts the process through which more and more candidates are rejected and fewer
candidates are selected. Sometimes even not a candidate is selected. In selection, tests
as for example, intelligent test, aptitude test, achievement test, personality test etc are
conducted. In addition to these oral interviews, checking of references, certificates,
physical examination are also arranged.
iii. Technique: - Recruitment techniques are not very intensive, as against this in
selection, specialized techniques are required.

24
iv. Outcome: - Since recruitment and selection are interrelated steps in the process of
man power acquisition, they differ in terms of their outcome. The outcome of recruitment
is application pool which becomes input for selection process. The outcome of selection
process is in the form of finalizing candidates who will be offered job.
Program Evolution and review Technique (PERT)
PERT was first developed as a Management Aid for completing Polaris Ballistic Missile
Project in USA in October 1958. It worked well in expediting the completion of the project
from 7 years to 5 years. Since then, PERT has become very popular technique used for
project planning and control. In nutshell, it schedules the sequence of activities to be
completed in order to accomplish the project within a short period of time. It helps reduce
both the time and cost of the project.
Advantage: -
1. It determines the expected time required for completing each activity.
2. It helps complete the project within a given period of time.
3. It helps management handle uncertainties involved in the project and thus, reduces
the risk element in the project.
4. It enables management to make optimum allocation of limited resources.
5. It presses for the right action, at the right point and at the right time in the
organization.
Entrepreneur
Entrepreneur is one of the important segments of economic growth. Basically,
entrepreneur is a person responsible for setting of a business or enterprises. Entrepreneur
is one who has the initiative skill for innovation and how looks for high achievements. He
works for the people. He opens up many employment- opportunity and leads to the
growth of other sectors. He is a person how brings in over all change through innovation
for the maximum socials goods. In this process he accelerates person economic as well as
human development. He is a man with outstanding leadership qualities.
Entrepreneur is considered as an individual who bears the risk of operating a business in
the face of uncertainty about the future condition. According to professor John Tin Bergen
“the best entrepreneur in any developing country is not necessary the man who use
capital but rather the man who long how to organize the employment and training of rest
employee”.
An entrepreneur is one who innovates raise, money, assembles inputs, chooses
managers and set the organization going with his ability to identify them. Innovation
occurs through:
I. The introduction of a new quality product.
II. A new product.
III. A discovery of a fresh demand and a fresh source of supply.
IV. By change in the organization and management.
A most appropriate definition of entrepreneur is that he is a man who detects and
evaluates a new situation in his environment and direct the making of such adjustment in
the economic system as him deems necessary.
An entrepreneur performs one or more of the following:-
i. Perceives opportunity for profitable investment.
ii. Explores the prospects of starting manufacturing enterprises.
iii. Arrange initial capital.
iv. Provides personal guaranties to the financial institution promised to meet the
short falls in the capital.
v. Supply technical knows how.
Entrepreneur is an organizer speculator of business enterprises. Entrepreneur lives
economic resources out of an area of lower to an area of higher productivity and better
yield.
Entrepreneur is often associated with a person who starts his own new small business.
*Entrepreneurial Function:-
i. Assumption of risk
24
ii. Business decision
iii. Managerial function
iv. Deciding the project
v. Raising finance
vi. Planning production
vii. Earning profits
viii. To study the market and to take advantage from opportunities and threats.
ix. To arrange finance, raw materials and machinery.
Entrepreneurship
Entrepreneurship is a process of action an entrepreneurship undertakes to establish
his enterprise. Entrepreneurship is a resultant mix of many quality and traits of an
entrepreneurship.
Entrepreneurship can be defined as a process undertaken by entrepreneurship to
argument his business interests. It is an exercise invoking innovation and creativity that
will go towards establishing his/her entrepreneurship.
Entrepreneur Entrepreneurship Enterprise
Person Process of action

Object
Concept of Entrepreneurship: -
Entrepreneurship is the inclination of mind to take calculated risk with confidence
to achieve a predetermined business or industrial objectives.
EN Accepting challenges
TR Organization
EP Skillful management
RE Risk taking
NE Decision making
UR Innovation
SHIP Making the enterprise a success
* Feature of an Entrepreneurship: -
1. Innovation
2. A function of high achievement
3. Organization building
4. Group level activities
5. Managerial skill and leadership
6. Gap filling
7. Entrepreneurship – an emerging class.
* Successful Entrepreneurship:
Following aspects are necessary for the successful entrepreneurship:
1. Regular inflow of information related to buyers, consumers, distributors, dealers,
retailers, transporters etc. about raw material, quality aspects, government organization,
employees and competitors.
2. Satisfying the needs of customers
3. Generation of adequate cash flow
4. Regular objective assessment of the enterprise
5. Improving productivity
6. Maintenance of quality
7. Use of technology of the time
8. Be innovative
9. Keep employees motivated
10. Scrap or waste material be utilized property
11. Time management.

24
*Forms of business organization:-
1. sole proprietorship
2. partnership a) Private
3. Joint stock company b) Public
4. Cooperative Sector
5. Government enterprise/organization.
• Indian partnership act made in 1932.
• Sole proprietorship is the oldest form of business.
• Maximum numbers of partnership in banking business is 10.
Indian partnership act 1932:-
Section-4:-
“Partnership is the relation between persons who have agreed to share the profits
of a business carried on by all or any one of them acting for all”.
Minimum partner 2 Other business.
Maximum partner20
Indian companies act 1956:-

i. Private  Can’t sales its shares in market.
ii. Public  Can sale its share in market.
iii. Public enterprise company (Government Corporation).
iv. Charitable company.
v. Foreign Company.
Company: - According to Prof. P. Asthana; “A company is an artificial person, invisible
and intangible, created by law, endowed with perceptual succession with a common seal,
having distinct entity separate from the members composing it usually with a limited
liability”.
Private Company:-
 In private company, minimum no. of partners should be 2 and maximum no. of
partners should be 50.
 In private company writing of Private Ltd. with name is necessary condition (i.e. Pvt.
Ltd should be written as soul).
 Transfer of shares of private company do not allowed.
 Selling of shares for business purpose is not allowed.
 If any company earns 3 crores or more in 3 years then it will become a public ltd.
company.
Public Ltd. Company:-
 Shares are transferable.
 Shares can be sale.
 Only “Ltd.” word may or may not written as sole.
Village and Cottage Industries:-
It is a small industrial activity of manufacturing, processing, preservation and or
servicing in an areas with population not exceeding 50,000 involving utilization of locally
available natural resources and or human skills, where individual credit requirements do
not exceed Rs. 50000. According to Fiseal Commission; “Cottage industries are those
which are run by the members of the family either for full time or for past time”.
According to Bombay Economic And Industrial Investigation Committee, these
are those industries which do not use modern power and engage a maximum of 9
persons.
Tiny Industries:-
Tiny sectors are small industrial units having investment in plant and machinery up
to 25 lacks irrespective of their location is situated in towns with population less than
50,000. Such industries are also called “Mini Industries”.

24
Small Scale Industries:-
Small scale industry is an industry, in which investment in fixed assets in plant and
machinery does not exceed Rs. 3 crores and Rs. 3 crores in case of an “ancillary unit” also
irrespective of the no. of persons employed.
However, it is necessary to note at this stage the difference between a cottage or a
village industry and a small scale industry. The cottage and village industries are based
on traditional skills and practically require no modern machinery. The small scale industry
as compared to them is quite big and it works with modern machines and electrically.
However, there is no hard and fast rule for this and it is a matter of convenience only.
Advantage Of Small Scale Industry:-
1. It provides better and quick employment.
2. It is labour intensive and capital saving.
3. With small investment production can be easily and quickly started.
4. Highly sophisticated machines and modern technology is not needed.
5. It attracts small saving and diverts them into productive channels.
6. It provides economic development by rapid industrialization.
7. It provides check on monopoly.
8. It reduces imbalance of income and property.
Ancillary Units: -
Ancillary industries are those small scale industries, which are engaged in:
i. The manufacture of parts, components, sub-assemblies and tooling etc, for
supply against know or anticipated demands of one or more large industries.
Or
ii. The rendering of services and supplying or rendering or proposing to supply or
rendering 50% of their production or the total services as the case may be.
In the definition of small scale industry the value of plant and machinery includes
the investment made in productive plant and machinery. In calculating the value of plant
and machinery the actual payment made by the owner irrespective of whether plant and
machinery is old or new will be taken into account. The cost of tools, jigs, dies moulds and
spare parts for maintenance the cost of installation of plant and machinery will not be
taken into account while calculating the value of plant and machinery. Similarly, cost of
generating sets, extra transformers, bank and service charges etc are not taken into
account in calculating the cost of plant and machinery.
Medium Scale Industries:-
Those industries in which investment in fixed assets in plant and machinery does not
exceed Rs. 5 crores and not less than the limit of small scale units.
Large Scale Industries:-
Those industries in which investment in fixed assets in plant and machinery exceeds Rs. 5
crores.
Joint Stock Company
Limited financial resources heavy burden of risk involved in both of the previous forms of
organization has led to the formation of joint stock companies. These have limited
liability. In this system, capital is contributed by a large no. of persons. It is voluntary
association of individual or profit, having a capital divided into transferable shares of
different values. The capital is raised by selling shares of different values. Persons who
purchase the share are called share holders. The board of director is responsible for policy
making important financial and technical decision and efficiency working of an enterprise.
In this form of organization, liability of the share holders is limited to the extent of
the amount of shares hold by him and he is free from the responsibility of the department
and claims on the company beyond the value of shares. Because of this advantage, all
section of people is encouraged to contribute for the company.
These shares are transferable.
There are two main types of joint stock companies:-
1. Private Ltd. Company:-
24
This type of company can be formed by two or more persons. The maximum no. of
membership is to limited to 50. In this transfer of shares is limited to members only and
general public can’t be invited to subscribe the shares. Normally, the members of such a
company are friends and relatives.
A private limited company need not make the prospectus, accounts and other
particular open to the public. The members only entitled to receive a copy of the balance
sheet and auditor’s report. The government also doesn’t interface in the working of the
company. In this system, persons who want to take advantage of limited liability and at
the same time to keep the business as private as possible can subscribe.
2. Public Ltd. Company:-
It is one whose membership is open to general public as its name indicates. The
minimum number required to form such a company is 7 but, there is no upper limit. Such
companies can advertise to offer its share to general public through the prospectus.
These public limited companies are subjected to greater control and supervision of the
governments. This control is necessary to protect the interest of the share holders and
the members of the public. Shares are transferable in part or full without requiring any
prior approval. The affairs of the company are managed by an elected body known as
‘Board of Directors’. The no. of members in the board of directors is limited to 7.
Raising Finance for Joint Stock Companies:-
Money is necessary to start and to keep the business running. It is also needed to
meet expansion, replacement and alteration. The required capital is supplied by
individuals, societies and associations. Funds can also be taken from banks, Finance
Corporation etc in the form of loan.
Following are the sources from where money can be taken for an enterprise:
a. Issue of Shares:-
A portion of the money required for enterprise is collected in the form of shares.
b. Issue of Debentures:-
When company desire to raise the required finance through loans instead of sale of
shares, then debentures are issued. In this way, it is advantageous because debenture
holder can’t claim for ownership and he is to be paid interest only. Debentures may be
issued either for initial needs of enterprise or for development and extension.
c. Loan advances from banks and other financial institutions like LIC and UTI.
d. State loans from Industrial Corporation, state finance corporation or through
industrial development corporation.
Advantages:
Following are the advantages of the Joint Stock Company over the previous two forms
of business organization:-
i. The liability being limited, the share holder bears no risks and therefore more and
more persons are encouraged to invest capital. Thus more amount of capital can be
collected to run modern industries.
ii. Because of large no. of investors, the risk of loss is divided. Therefore, even average
persons can contribute capital without much hesitation.
iii. In the Joint Stock Companies, the work is divided among different groups of persons;
hence better work can be done.
iv. It has great potentialities for expansion.
Disadvantage:
i. Lack of personal interest on the part of the salaried managers because there is
no relation between effort and income for them and this lead to in efficiency and
waste.
ii. If requires a large no. of legal formalities to be observed.
iii. It is difficult to preserve secrecy in these companies.
Entrepreneurship

24
Entrepreneur: - Entrepreneur is an organizer and speculator of a business enterprise.
Entrepreneur lifts economic resources out of an area of lower to an area of higher
productivity and greater yield.
Entrepreneur is either originator of n new business ventures or a manager who tries to
improve an organizational unit by initiating productive change. Entrepreneur is often
associated with a person who starts his own new and small business.
Entrepreneurship - Entrepreneurship is a process of action an entrepreneur undertakes
to establish his enterprise. Entrepreneurship is a resultant mix of many qualities and
traits of an, entrepreneur.
Qualities of an Entrepreneur Successful Entrepreneurship:
1. Self-confidence Following aspects are necessary for the
2. Result oriented successful entrepreneurship:
3. Risk taker 1. Regular inflow of informational related to
4. Innovativeness, creative buyers, consumers, distributors, dealers,
5. Knowledgeable retailers, transporters etc., about raw
6. Open minded, and flexible material, quality aspects, government
7. Foresightedness organizations, employees and
8. Leadership competitors.
9. Managerial competence 2. Satisfying the needs of customers.
3. Generation of adequate cash flow.
10. Realistic approach
4. Regular objective assessment of the
11. Energetic and hardworking
enterprise.
12. Resourcefulness.
5. Improving productivity.
13. Tactfulness 6. Maintenance of quality.
14. Clarity of views. 7. Use of technology of the time.
8. Be innovative.
9. Keep employees motivated
10. Scrap or waste material is utilized
properly.
11. Time management.
Objectives Of Entrepreneurial Successful Entrepreneurship:
development:
Objectives of entrepreneurial development Following aspects are necessary for the
program are to help to: - successful entrepreneurship:
1. Develop and strengthen their entrepreneurial i. Regular inflow of informational related
quality. to buyers, consumers, distributors,
2. Analyze environment related to small business dealers, retailers, transporters etc.,
and small industry. about raw material, quality aspects,
3. Select product and its project. government organizations, employees
4. Formulate projects. and competitors.
ii. Satisfying the needs of customers.
5. Understand the procedure for setting up of
iii. Generation of adequate cash flow.
small enterprise.
iv. Regular objective assessment of the
6. Support needed for launching the enterprise.
enterprise.
7. Acquire basic management skills.
v. Improving productivity.
8. Appreciate the social responsibilities. vi. Maintenance of quality.
9. Let him set the objectives of his[ business. vii. Use of technology of the time.
10. Prepare him to accept risks. viii. Be innovative.
11. Take strategic decisions. ix. Keep employees motivated
12. Develop communicating skills. x. Scrap or waste material be utilized
properly.
xi. Time management.
ENTREPRENEUR MOTIVATION

24
Motivation is related to the inner urge present in art individual which demands from
him to do something new and something unique and to perform better than others.
Motivation is a force that influences the efforts of the entrepreneur to achieve his
objectives. He is motivated to achieve his excellence in job performance. He is further
motivated by reward in terms of profit.
Entrepreneurial development
For the economic development, entrepreneurial development is necessary. Fur the
purpose of entrepreneurial development, rapid growth of small scale sector is necessary.
Entrepreneurial development programs are designed to help a person in strengthening
his entrepreneurial motive and in acquiring skills and capabilities necessary for playing
his role effectively. Main objective of the entrepreneurial development program is to
motivate and assist prospective and potential entrepreneurs to set up small scale units of
their own and thus become self-employed and contribute significantly to production and
employment in the country.
Entrepreneurial development program must be designed properly and should
incorporate the following: -
Developing, achievement, motivation and sharpening entrant-uric I traits and
Project planning and development, and guidance on industrial opportunities, incentives
and facilities, rules and regulations.

24

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PROFESSIONAL STUDIES & ENTREPRENEURSHIP

SIDBI (Small Industries Development Bank of India)

SIDO (Small Industries Development Organization)

SFC (State Financial Corporation)

At present more than 20 states financial corporation are functioning except-

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IDBI (Industrial Development Bank of India)

Consumer Protection Act-1986

Q. Who is a consumer for the purposes of this act?

Answer: A consumer can be a consumer for goods or consumer for service. A

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TCOs (Technical consultancy organizations)

SISI (Small Industries Services Institute)

It has its own— (1) Workshop,

 Phases In Installing A Project

Design alternative solution produce (for each soln.)

Cost Benefit Analysis

Recommendation and Presentation

Fig:-Project Identification &

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 Detail Project Report

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Critical Path Method(C PM)

District Industrial Centre (DIC)

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The Indian Factory Act (1948)

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Workers Compensation Act-1923

It is an act to provide for payment by certain classes of employees to their workman

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United Nation Industrial Development Organization

Employee State Insurance Act (ESI Act)-1948

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The Minimum Wages Act-1946

The concepts of minimum wages first evolved with reference to remuneration of

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Industrial Finance Corporation of India (IFCA)

Khadi & Village Industries Commission (KVIC)

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Industrial Credit And Investment Corporation Of India (ICICI)

Export And Import (EXIM) Bank

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IBRD (World Bank)

International Bank For Reconstruction And Development (IBRD)

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NABARD (National Bank for Agricultural and Rural Development)

DUTY:--“Expected action is duty.”

Management is according to:

Q. WHAT DO YOU MEAN BY MANAGEMENT AND WHAT IS THE FUNCTION OF

According to Lapiere and Farmsworth, “Leadership is the behaviour that affects

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Q. What do you mean by leadership? Discuss the characteristics

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Q.  Define motivation? Discuss the important type of motivation.

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• Some Important Questions and their solutions:

Q. What do you mean by Supervisory Management? Discuss the role of a

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Person Process of action

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Indian companies act 1956:-

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Professional Studies & Enterprenuership

Professional Studies & Enterprenuership