m Meaning of Entrepreneur;

m Evolution of the Concept

m Functions of an Entrepreneur
m Types of Entrepreneur
m Intrapreneur - an emerging Class
m Concept of Entrepreneurship - Evolution of Entrepreneurship
m Development of Entrepreneurship; Stages in entrepreneurial
process;
m Role of entrepreneurs in Economic Development; Entrepreneurship
in India; Entrepreneurship ± its Barriers

5/20/2011 2
ith increasing business opportunities and facilitating
business environment, scope for New Venture Creation
increases.
In the current technology driven era, access to data /
information has become easy, thus increasing awareness
levels and aspiration levels of individuals considerably.
Thus growing business opportunities on one side and well
informed and motivated individuals on the other side will be the
right mix for creating more and more enterprises.

5/20/2011 3
The word µentrepreneur¶ is derived from the French
verb µentreprendre¶, which means µto undertake¶.
This means those who undertook the risk of new
enterprise. Hence, the process of creating a new
enterprise can also be called as
µEntrepreneurship¶ and the persons who creates it
an µEntrepreneur¶.

5/20/2011 4
Entrepreneurship also can be defined as a
process of creating of wealth (ethically) for one or
more persons, using one¶s (team¶s) competence /
skill-set through creation of an enterprise after
evaluating market opportunities along with the
risks involved.

5/20/2011 5
1. Entrepreneur is the one who innovates, and introduces something new in the economy.
«. ã
 


2. He shifts economic resources out of an area of lower and into an area

of higher productivity and greater yield. .. ã  (French Economist)

3. He searches for change, responds to it and exploits opportunities.

Innovation is the specific tool of an entrepreneur. « 
 

4. He is a critical factor in economic development and integral part of

economic transformation. «   

5. He is a person who is able to look at the environment, identify opportunities To improve

environment, marshall resources, and implement action to maximize those opportunities.
«. 



6. He is an agent who buys means of production at a certain price in order to

combine them into a product that is going to sell at prices that are certain
at the moment at which he commits himself to his costs. « 
 

5/20/2011 6
m Idea generation and scanning of the best suitable
idea.
m Determination of the business objective
m Product analysis and market research
m Determination of form of ownership/organization.
m Completion of promotion formalities
m Raising necessary funds.
m Procuring machine and material.
m Recruitment of men.
m Undertaking the business operation.
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16
Some of the common characteristics that
most of the successful entrepreneurs
possess are:
1.Creativity 7. Problem Solving
2.Innovation 8. Goal orientation
3.Optimistic v.Risk Taking and
4.Leadership Decision Making
5.Team Building ability
6.Achievement Motivation 10. Commitment

5/20/2011 17
1. Creativity is the ³ability to bring something new into
existence´. Ideas evolve through creative process.

2. Innovation is key tool of entrepreneurs. It is an act that

endows resources with a new capacity to create wealth.

3. Optimistic :The successful entrepreneurs are not

disturbed by the present problems faced by him. They
are optimistic for future that the situation will become
favorable to business in future.

4. Leadership is the ability of the person to get the work

done by the subordinates.
4. Team Building An entrepreneur should have ability to
build a team. A team is a group of individuals with a
common purpose, that is focused and aligned to
achieve a specific task. A good team will be able to
share knowledge, core competency and goals.

5. Achievement Motivation Entrepreneurs normally

have high need for achievement motivation and are
guided by their inner self, motivating their behaviour
towards accomplishment.
6. Problem Solving Entrepreneurs normally solve the
problems and normally do not avoid.
 7.Orientation is achievement of targets and objectives
for the successful performance of an entrepreneurs,
both long term and short term.
8.Risk taking and Decision-making Entrepreneurs have to
make decisions under conditions of uncertainty and therefore,
are ready to bear risk, but never gamble with results. A good
entrepreneur normally avoids excessively µhigh or low risk¶
situations.
v. Commitment One of the subtle qualities of an
entrepreneur is his / her µwill power¶. Strong determination
with sound thinking fortifies the power. It is this determination
that makes the entrepreneur work for 7X24 around the year.
m ·


· ·
· - Resources
are put to proper use by Entrepreneurs. They combine
various resources Land, Labour, Capital, and
Organisation to produce goods.

m  
· ·
 ·
- provides
employment, reducing unemployment problem.

m  ·
 
 ·

 ·

·  by providing quality goods & services.
m h 
·- providing high yielding
variety of seeds, fertiliser, pesticides, agricultural
implements etc many entrepreneurs buy
agricultural produce for further processing.

m ··

 
· 
- exporting

goods mfg by them help govt to earn Foreign
exchange.
m — · · 
- Government
incentives encourage entrepreneurs to establish industry
units in rural & backward areas- create employment
opportunities in industrially backward areas.

m  ··· : for the

benefit of customers- by regulating taking market
research.
m h  · 

- by providing welfare
activities- adopting villages, schools, stating educational
institutes, healthcare services, sports.

m  

·
· - pooling the savings of people by
issuing shares/ debentures- offering more returns
comparatively.

m 
—
· ·
 ·
h- by establishing
in rural / backward areas, not only balance regional
development but also redistribution of income & wealth.
 m According to
ï Type of business
ï Use of technology
ï Motivation
ï Growth
ï Stages of development
ï Area
ï Age and gender
ï Scale of operation
ï others

5/20/2011 25
 Ô

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ti
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riti ill t

   
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rti ( i, t fili)
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  !

ATechnical entrepreneur: Production oriented, possesses innovative

skills in manufacturing, quality control etc.

ANon technical entrepreneur: Develops marketing, distribution

facilities and strategies

AProfessional entrepreneur: Uses the proceeds from sale of one

business to start another one. Brimming with ideas to start new venture.
  "#$"

APure entrepreneur: Psychological and economic rewards

motivate him

AInduced entrepreneur: Incentives, concessions, benefits

offered by government for entrepreneurs motivates him

ASpontaneous entrepreneur: Born entrepreneurs with

inborn traits of confidence, vision, initiative
 "
AGrowth entrepreneur: One who enters a sector with a
high growth rate; is a positive thinker

ASuper growth entrepreneur: One who enters a

business and shows a quick, steep and upward growth
curve
  ·

  % he is the one who
introduces a new product or a new method of
production or opens a new market or explore new
source of supply of raw material or carry out a new
type of organization. as per the Schumpeter innovative
entrepreneur are real entrepreneur.
 

·

  % are those
who imitate the successful entrepreneurs in
techniques innovated by others.
m Urban entrepreneurs
m Rural entrepreneurs

5/20/2011 31
m Xoung entrepreneur
m Old entrepreneur
m Male entrepreneur
m Female entrepreneur

5/20/2011 32
m Small scale entrepreneur
m Medium scale entrepreneur
m Large entrepreneur

5/20/2011 33
m It is a process undertaken by an entrepreneur to
augment his business interests
m ³ entrepreneurship is the process of creating
something new with value by devoting the
necessary time and effort, assuming the all
financial, psychic, and social risk and receiving
the resulting reward of monetary and personal
satisfaction and independence.´

5/20/2011 34
m Öey to Economic Development
m Öey to New Product / Process development
m Many innovations have completely changed the
way even we think !
m Market opportunities and entrepreneurship are
co-related (assuming there is a facilitating
environment)

5/20/2011 35
m Early period
m Middle ages
m 17th century
m 18th and 1vth century
m 20th century

5/20/2011 36
m Early period:
´ An early example of entrepreneurship is known to be
the example of Marco polo who tried to trade routes to
the far east. He used to sign a contract with a venture
capitalists to sell his goods. The capitalist was the risk
bearer, the merchant-adventure took the role of
trading, bearing all physical and other risks. The profit
were shared by the capitalist and merchant

5/20/2011 37
m In the Middle ages, the term entrepreneur was
referred to a person who was managing
large projects. he was not taking any risk but
managing the projects using the available
resources.
m During 17th century, amalamagation of risk with
entrepreneur had evolved. A person used
to enter into a contractual agreement with Govt. to
perform a service or to supply some goods.
 this involved some risk since the contract price was
fixed and profit or loss was borne by the
entrepreneur.
m As a result of industrialization during 18th century
the person with capital is differentiated from the
person who needs capital.
m During this, the entrepreneur were not
distinguished from manager but in the middle of
20th century, the notion of an entrepreneur as an
innovator was established
 "&   "&  $
 "'(
An entrepreneur must find, evaluate, and develop an
opportunity by overcoming the forces that resist the
creation of something new. The process has four
distinct phases:
(1) Identification and evaluation of the opportunity,
(2) Development of the business plan,
(3) Determination of the required resources,
(4) Management of the resulting enterprise.

40
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&  

 

41
´ Opportunity assessment
´ Real and perceived value of opportunity
´ Risk and returns of opportunity
´ opportunity versus personal skill and goals
´ Competitive environment

5/20/2011 42
m Preparation of the business plan
´ Title of the project, table of contents and executive
summary
´ Description of business and industry
´ Technology plan
´ Financial plan
´ Organizational plan
´ Production and operation plan
´ Marketing and distribution plan
´ Summary of plan

5/20/2011 44
m Determining resources needed
m Deterring existing resources
m Identify the gap and available supplier
m Develop access to needed resources
m Develop management style
m Understand key variable for success
m Identify problems
m Implement control system
m Develop growth strategy
m Inadequate technical knowledge
m Inadequate Finance
m Legal systems
m Bureaucratic Structure
m Infrastructure
m Management deficiency
m Inadequate understanding of Risks involved
m Lack of capital
m Unstable and unpredictable market

5/20/2011 47
As the companies become big, the working becomes more
mechanized and rules driven. Hence, bigger the
organization, lesser will be scope for µinnovation¶.
Managers who possess qualities of entrepreneurs are
encouraged by corporate to initiate new programmes /
projects which may later develop into a new product /
service that could be commercialized.
This process of creating µentrepreneurs¶ inside the
organization is known as ð

¶. However, in
this model the entrepreneurial manager is free from
financial risks.

5/20/2011 48
m New business venturing
ï New business within the organization.
m Innovations
ï New product, improvement, methodology
m Self-renewal
ï Renewal of main ideas
m Proactiveness
ï Initiative, risk taking, competitiveness

5/20/2011 4v