ENTREPRENEUR

ENTREPRENEUR
Meaning
The word entrepreneur is derived from the french word
entreprendre which means to undertake.
Evolution of concept
1.In 16th century, Frenchmen who organized and led
military force were referred to as entrepreneurs.
2.In 18th century, French economist Richard cantillon
used the word entrepreneur to business.(risk of
establishing new organization).

Entrepreneur is a person who undertakes an enterprise.

The process of creation is called entrepreneurship.

An entrepreneur can be considered as a person who bears the
risk of operating a business in the face of uncertainty about the
future conditions.
Who innovates and introduces something new in the economy
Who shifts resources out of an area of lower and into an area
of productivity and greater yield

Who plays a critical role in economic development and an

integral part of economic transformation

An entrepreneur can be considered as an agent who

buys the four factors of production at certain prices
in order to combine them into product with a view
to selling it at uncertain prices in future.

Evolution of the concept

The word entrepreneur has been derived from the
French word which means to undertake Was
originally meant to designate an organizer of musical
or other entertainments.
According to oxford English dictionary in 1897 was
defined as the director or manger of public musical
institution who gets entertainment in the form of
musical performance.
16th century: In 16th century it was applied to those
who were engaged in military expeditions.

Contd.........
17th century: In 17th century it was extended to
cover civil engineering activities such as construction
and fortification.
18th century: In the beginning of the 18th century the
word was used for economic aspects. In the way the
evolution of the concept of entrepreneur can be
considered to be over more than four centuries.

Charecterestics of
entrepreneur
Action

oriented, highly motivated& ready to take risk

at all levels to achieve goal
Should have determination & commitment
Accept responsibility with enthusiasm
Self confident, dedicated &self disciplined
Both thinker& doer, planner& worker
Future vision ,intelligent, imaginative &self directed

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Qualities of entrepreneur
Success & achievement
Risk bearer
Opportunity explorer
Planner
Stress taker
Facing uncertainties
Independent
Flexible
Self confident
Motivator

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Functions of an
entrepreneur

1. Planning of the project: He is the organizer to conceive the idea of

launching the project and to Program to structure of the business

2. Management: The entrepreneur is also responsible for the management of

business. He tries to have a least cost combination of factors of production.

3. To Face Risks: He faces uncertainly and bears risks in his business

uncertainly comprising those risks against which it is not possible to insure.
He also faces the risk of other producers may enter the market

4. Distribution of Rewards: He is responsible of distributing the rewards to

all factors of production. He pays the reward in the shape of rent, wage, and
interest and bears the risk of profit or loss himself

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5. Sale of Products: An entrepreneur is also responsible of marketing,

advertising. He wants to maximize his profits by selling his product in the
market.

6. Scale of Production: He decided the scale of business in according with

the provision of capital. Then, he takes the decision of what where and
how to produce goods.

7. Joint stock Organization: In a partnership, the entrepreneurial

functions are divided between the partners. But in public limited company,
the board of directors takes this responsibility with nationalized enterprise;
the entrepreneurial decisions are left to the government or a body to which
government has delegated its powers.

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Type of entrepreneurs
1)According to the type of business
i)Business entrepreneur
ii)trading entrepreneur
ii)industrial entrepreneur
(a)Large
(b)medium
(c)small and
(d)tiny
iv)corporate entrepreneur
v)agricultural entrepreneur
(a)plantation b)horticulture c)dairy d)forestry vi)Retail entrepreneur
vii)service entrepreneur

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2)According to the use of technology

i)technical ii)non technical (iii)professional
3)According to the motivation
i)pure ii)induced iii)motivated iv)spontaneous
4)According to growth
i)growth ii)super growth
5)According to stages of development
i)First generarion ii)classical iii)modern
6)According to the area
i)urban ii)rural
7)According to the gender and age
i)men ii)women
8)According to the sale of operation
i)small ii)large
9)Others or unclassified
i)professional ii)non-professional iii)modern iv)traditional v)skilled vi)nonskilled
vii)imitating viii)inherited ix)forced x)national international xii)bureaucratic
xiiii)intrapreneur xiv)immigrant
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INTRAPRENEUR
Is an emerging class found in large industrial organizations who
emerge from within the confines of the large industrial
organizations.
In big organizations top executives are encouraged to catch hold
of new ideas and convert them into products through research
and development activities within the framework of the
organization.

Very popular in developed countries like America. Many

Intraprenuers are found leaving their jobs in big organizations
and starting their own enterprises and have become exceedingly
successful in their ventures.
Are causing threat to the organizations they leave who
inaugurate new products.

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Intrapreneur is a person who focuses on innovation and

creativity and who transforms a dream or an idea into a
profitable venture, by operating within the organizational
environment.
Intrapreneurs, by definition, embody the same characteristics
as theEntrepreneur, conviction, passion, and drive.
If the company is supportive, the Intrapreneur succeeds. When
the organization is not, the Intrapreneur usually fails or leaves
to start a new company. An Intrapreneur thinks like an
entrepreneur seeking out opportunities, which benef it the
corporation.
It was a new way of thinking, in making companies more
productive and profitable.
Visionary employees who thought like entrepreneurs.
IBM is one of the leading companies, which encourages
INTRAPRENEUR.
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Elements of
intrapreneurship

New buisness venturing:

Creation of buisness within the organisation
It includes redefining the companys product or services,
development of new market or formation

Innovation
Development of new product

Self renewal
Transformation of an organisation through the renewal of
main ideas
Includes redefining of business concept

Proacativeness
Initiative & risk taking, competitiveness & dashing to take
new challenge

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Point

Intrapreneur

Entrepreneur

Manager

1.Goal management Independent,

Independent , starts
innovates new ideas a new venture
& leads direct
involvement

Delegates and
supervises than
direct involvement

2.status

Not concerned
about traditional
status, but wants
recognition

concerned about
traditional status

3. Risk

Owns moderate risk Bears all the risk

and uncertainity

Does not bear any

risk

4. Rewards

Gets fixed reward

for his work.

Since there will be

risk he may get
profit or loss based
on outcome

Works for salary

which is fixed and
definite for his
servic

5. Innovation

Innovative

Very Innovative

Need not to be
Innovative

6. Decision making

Moderate , limited
to his work

Very much involved Delegates the

decision of top
management

Not concerned
about traditional
status

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Entrepreneurship
concept of Entrepreneurship

It is indivisible process flourishes, when the

interlinked dimensions of individual psychological
entrepreneurship

It lies more in ability to minimize the use of

resources & put them to maximum advantage

It is the process of identifying opportunities in the

market place, arranging the resources required to
peruse these opportunities & inverting the
resources to exploit the opportunities
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Charecterestics Of
Entrepreneurship
Innovation
Risk taking
Skilful management
Organisation
Decision making
Making enterprise a success

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Evolution Of
Entrepreneurship

Early period
MARCO POLO- he used to sign a contract with
ventures capitalist to sell his goods
Capitalist risk bearer
Merchant adventure took the role of trading ,bearing
all physical & other risks
After successful shared the profit by capitalist &
merchant

Middle ages
Entrepreneur managing large project
Not taking any risk only managing the project with
provided resources
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17th centuary
A entrepreneur used to enter into contractual
agreement with govt. To perform a service or to
supply some goods
There was some risk contract prise was fixed
,profit or loss was borne by entrepreneur

18th &19th centuary

As a result of industrialisation during 18 th centaury
the person with capital(capitalist) is differentiated
from the person who needs capital(entrepreneur)
Many technical inventors did not have money to
turn their inventions into products
Some capitalists had to finance them

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20th centuary
During this entrepreneurship not distinguished
from managers &were viewed mostly from the
view of economy
He organises & operates an entrepries for
personal gains
He takes risk, contributes his own, initiative skills
he plans, organises leads his enterprise

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STAGES IN ENTREPRENEURIAL
PROCESS
Identification of opportunity
Evaluation of the opportunity
Preparation of business plan
Determination & organizing the resources
Management of the enterprise

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Identification of opportunity

Identifying and evaluating an opportunity is a difficult

task and one has to be watchful for opportunities.

Ideas may be his own or can from various external

sources such as consumers, business associates,
members of distribution system, independent technical
organization, consultant etc

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Evaluation of the opportunity

one has to be careful in evaluating the opportunities

carefully once they identify the opportunity and
identify a suitable project.

It is the most critical element of entrepreneurial

process.,

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Preparation of business plan

the next step is to develop a plan for the venture,

nothing but developing a business plan.

This is the time consuming activity of entrepreneurial

process.

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Determination & organizing the resources

After assessing the resource position a further step is to

assess the resource position

In order to bring his concept to reality entrepreneur has to

organize resources like financial resources, operating
resources, human resources and technical resources.

Then implement the business plan.

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Management of the enterprise

Once the enterprise is established, an entrepreneur

should always look forward to indefinite future,
growth, development and continuation.

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ROLES OF ENTREPRENEUR IN
ECONOMIC DEVELOPMENT

Process through which innovation develops & commercialises

through entrepreneurs activity which in turn results in economic
growth

Entrepreneur bridges the gap between science & market place,

creating new enterprises & brings new products & services into
the market.

In some areas entrepreneur thrusts impact & plays vital role both
in overall economic devpt & creating employment to people

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Role of entrepreneur economic development of

a country:

Entrepreneurship:

Promotes capital formation by mobilizing the idle saving of the public.

Provides immediate large scale employment thereby reducing the

unemployment problem in the country.

Promotes balanced regional development.

Helps reduce the concentration of the economic power.

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Entrepreneurs in india

Past
Business community was involved in trade &commerce.
This community is called Vaisyas & Banias
Few points w.r.t. Entrepreneurship in past
Manufacture & supply of product was based on demand
All members of family are involved in business from
planning to manufacture stage
Industrial activity was controlled by cast system
Skill of any enterprise was inherited from ancestor
Trade activity dept on cast system
Weavers weave cloths,
Goldsmith - ornaments
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Present
Tremendous growth of industries & services over
last50-60 yrs

Highly talented entrepreneur in india

G.D Birla, J.R.D.Tata, Godrej ,Azim premji of wipro

After second world war more buisness oppurtunities

projected like cement,steel

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Barriers of Entrepreneurship

1.Lack of capital.
2.Lack of technical knowledge.
3.Economic business cycles.
4.Non availability of raw materials and resources.
5.Government regulations.
6. Entry of foreign goods and globalization.
7.Risk.
8.Unstable and unpredictable markets.
9. Obsolence of technology and idea.

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Stimulates equitable redistribution of wealth, income and even political

power in the interests of the country.

Encourages effective resource mobilization of capital

and skill which

otherwise would remain unutilized and idle.

Also induces backward and forward linkages which stimulate the process
of economic development

Promotes export trade which is an important ingredient for economic

development

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Women entrepreneurs
women ---50% Of world population(home
maker)
Modern society

Academics teaching, politics business enterprise

banking sector hospital.

Involvement of women generates good

income to support their family

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Functions of women
entrepreneur
Exploration of prospectus of starting new
business
Pool up the resources
Establish the industrial enterprise
Manage the business
Development of strategies
To assume risk& uncertainties
To develop business &business decisions
motivation

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Problem of women
entrepreneur
Finance
Lack of education
Limited mobility
Family ties
Scarcity of raw materials
Stiff competition
Low risk bearing capacity
Social problem
male domination

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Steps taken to develop women

entrepreneur

Provide a basic education & establish

special institution to train them

Conduct special workshop

Favourable credit policies

Providing marketing help

Provide concessions

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Industries promoted by women

entrepreneur
Agarbathi manufacturing
Papad making
Embroidery
Handi-crafts for export
Catering service
DTP
Travel agency

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EDP
Identifying entrepreneur qualities of an
individual, provide required training
Preparing related project reports
Preparing entrepreneur to manage finance
Production technology
marketing

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Objectives of edp

To devp & strengthen entrepreneurial quality

To analysis environmental set up relating to
SSI & small business
To select product
To formulate project report
Good & bad in becoming entrepreneur
To enable him to communicate clearly &
effectively
Enable him to take decision
To select products
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