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Creation of new markets, new economic sectors? Entrepreneurship? : Entrepreneurship? Not Just Small Companies Not Just Start-Ups Not the Unscrupulous Promoters Not Just For-Profit Firms Not Just Non-Government Certainly not many “dot.com’s” What is it to you? If Entrepreneurship is the Answer, Then what are other questions? : If Entrepreneurship is the Answer, Then what are other questions? What it isn’t? Why is it important? What role does it play in society? What is its role internationally? How is being an entrepreneur different from being a manager? Entrepreneurship:Traditional Definitions : Entrepreneurship:Traditional Definitions Risk Taker Founder Capitalist Scoundrel Born not Learned Views of Entrepreneurship : Views of Entrepreneurship Francis A. Walker (1876) ...the new captains of industry as the principals agents of production and industrial process. Joseph Schumpter (1934) ...the entrepreneur is the man who gets new things done. Another View : Another View Peter F. Drucker (1964) ...’maximization of opportunities’ is a meaningful, indeed a precise, definition of the entrepreneurial job. It implies that effectiveness rather than efficiency is essential in business. The pertinent question is not how to do things right but how to find the right things to do, and to concentrate resources and efforts on them. More Views of Entrepreneurship : More Views of Entrepreneurship William Baumol (1968) He is the individual who exercises what in the business literature is called ‘leadership’ Albert Shapero (1975) ...a kind of behavior that includes: 1) initiative taking, 2) the organizing or reorganizing of social / economic mechanisms to turn resources and situations to practical account, 3) the acceptance of risk of failure. A major resource utilized by the entrepreneur is himself. Perhaps the Best Working Definition : Perhaps the Best Working Definition “The pursuit of opportunity beyond the resources you currently control” Professor Howard Stevenson Harvard Business School Entrepreneur and Manager : Entrepreneur and Manager Role- Rewards- Educational qualifications- Status- Risk- Innovation- Motive- Everyone needs to be entrepreneur.. Right? : Everyone needs to be entrepreneur.. Right? Entrepreneurs are INDEPENDENT Entrepreneurs get RICH Entrepreneurs have FUN! Entrepreneurs are FASHIONABLE EVERYONE WILL NOT BE HIM : EVERYONE WILL NOT BE HIM RISK! I'll repeat: risk risk risk risk risk risk RISK RISK RISK RISK RISK RISK RISK RISK RISK RISK! Starting a business is risky “The best way to become an entrepreneur is to jump into the water and get your feet wet” : “The best way to become an entrepreneur is to jump into the water and get your feet wet” For the true entrepreneur, reality is the superior teacher; and school is an excuse to delay failure. Jump in, take risks, challenge yourself, trust your instincts, and learn from both experience and experienced. Factors affecting business : Factors affecting business Competition Technological Interest rates Government policy Economic growth or contraction War and terrorism Strikes in other parts of the world Your employees’ personal problems Your investors’ personal problems Changing preference Entrepreneurial spirit : Entrepreneurial spirit Creative Excited about life and optimistic Independent Self-expression Risk-taking Classification of entrepreneurs : Classification of entrepreneurs Types of business Use of technology Motivation Growth Stages of development Area Gender and age Classification of entrepreneurs : Classification of entrepreneurs Clarence Danhof –on the basis of economic development. Innovating entrepreneurs Adoptive/Imitative entrepreneurs Fabian entrepreneurs Drone entrepreneurs Role and importance of entrepreneur : Role and importance of entrepreneur Entrepreneur Economy Self employment Capital formation Employment generation Regional development Innovation Forward and backward linkages Foreign exchange Entrepreneurial motivation : Entrepreneurial motivation Personal goals Need for achievement Ambition Compulsion Support Successful entrepreneurs Capital Status Invention vs. Innovation : Invention vs. Innovation Invention Creation of new things Results in new knowledge Innovation Transformation of ideas into useful application Results in new products The Entrepreneurship System : The Entrepreneurship System Conceptual Model Approach : Conceptual Model Approach Profits Barriers to entry Concentration Competence Education Role models Work experience Dissatisfaction Growth Innovation Level of capital investment Regulations Economies of scale Degree of competition Personal networks Tacit knowledge Job training Exposure to entrepreneurship education Level of education Close role models Awards Media Work position and situation Number of years Team experience experience Unemployment Need for independence/control Market potential Price and cost structure Future prospects Tax structure Level of Entrepreneurial Activity QUALITIES OF ENTREPRENEUR : QUALITIES OF ENTREPRENEUR Self-confidence Team Building Realistic Outlook Communication Emotional Stability Sense of Urgency Value for money Competitive Honorable Good health Slide 24: WOMEN ENTREPRENEURS WOMEN ENTREPRENEURS ? : WOMEN ENTREPRENEURS ? An enterprise owned and controlled by a woman having a minimum financial interest of 51% of the capital and giving at least 51% of employment generated in the enterprise to women. FUNCTIONS OF WOMEN ENTREPRENEURS : FUNCTIONS OF WOMEN ENTREPRENEURS Frederick Harbison: Exploration of the prospects of business. Undertaking risks and economic uncertainties. Innovations or imitation of innovations. Coordination , administration and control. Supervision and leadership. GROWTH OF WOMEN ENTREPRENEURS : GROWTH OF WOMEN ENTREPRENEURS Literacy rate- 40% = 60% MALE Work participation rate- 28% = 52% Low urban population-10% = 18% Total self-employed persons in India=5.2% INDIAN WOMEN ENTREPRENEURS : INDIAN WOMEN ENTREPRENEURS KERALA 358 in 1981 782 in 1984 PROBLEMS OF WOMEN ENTREPRENEURS : PROBLEMS OF WOMEN ENTREPRENEURS Finance Raw materials Competitions Mobility Family ties Education Male-dominated Low risk bearing ability 17th Aug.2010 : 17th Aug.2010 Entrepreneurial Motivation Entrepreneurial motivation : Entrepreneurial motivation Motivation: refers to the way in which urges, drives, desires, striving, aspirations or needs direct, control or explain the behavior of human beings. Dalton E. McFarland. Elements of Motivation: Motive Behavior Goal Motive Behavior Goal Motivational factors : Motivational factors Internal External Entrepreneurial motivation : Entrepreneurial motivation Personal goals (I) Need for achievement (I) Ambition (I) Compulsion (E) Support (E) Successful entrepreneurs (E) Capital (E) Status (E) David McClelland's needs-based motivational model : David McClelland's needs-based motivational model need for affiliation (n-affil) friendly relationships and interaction with other people need for authority and power (n-pow) influential, effective and to make an impact ,personal status and prestige. need for achievement (n-ach) attainment of realistic but challenging goals, and advancement in the job. Feedback as to achievement and progress, and a sense of accomplishment. Rewards and achievement-motivated people : Rewards and achievement-motivated people achievement is more important than material or financial reward. achieving the aim or task gives greater personal satisfaction than receiving praise or recognition financial reward is regarded as a measurement of success, not an end in itself. security is not prime motivator, nor is status. CONTD. : CONTD. feedback is essential, because it enables measurement of success, not for reasons of praise or recognition. achievement-motivated people constantly seek improvements and ways of doing things better. achievement-motivated people will logically favor jobs and responsibilities that naturally satisfy their needs, ie offer flexibility and opportunity to set and achieve goals, eg., sales and business management, and entrepreneurial roles. CHARATERISTICS OF (N-ACH) : CHARATERISTICS OF (N-ACH) the capacity to set high personal but obtainable goals. the concern for personal achievement rather than the rewards of success the desire for job-relevant feedback (how well am I doing?) rather than for attitudinal feedback (how well do you like me?). Factors in entrepreneurial success: : Factors in entrepreneurial success: Achievement Oriented Personality Entrepreneurial Attitudes Belief in Self and Ability Social Context Precipitation Event Intention to Start a Venture Opportunity Recognition Controlling Resources Timing 17th AUG. 2010 : 17th AUG. 2010 Establishing Entrepreneurial System Slide 41: “ You cannot teach a man anything. You can only help him discover it within himself” -Galileo Establishing Entrepreneurial System : Establishing Entrepreneurial System Business ideas Ideas processing Idea selection Inputs Enterprise Business IdeasMansukhbhai Mahadevbhaib Kothari : Business IdeasMansukhbhai Mahadevbhaib Kothari Markets Consumers Peers and friends Analyzing other nations Project profiles Govt. organisations and NGOs Trade fairs and Exhibitions Environmental Variables : Environmental Variables Supplies Employees/Labor Unions Competitors TradeAssociations Communities Customers Creditors SpecialInterestGroups Governments Stockholders Structure Culture Resources Elements of Industry – The Five Forces Model : Elements of Industry – The Five Forces Model Suppliers Buyers NewEntrants Substitutes IndustryCompetitors Intensity ofRivalry BargainingPower ofSuppliers BargainingPower ofBuyers Threat of New Entrants Threat of Substitutes 25th Aug. 09PROTECTING YOUR IDEAS : 25th Aug. 09PROTECTING YOUR IDEAS Developing Creativity and Understanding Innovation : Developing Creativity and Understanding Innovation Innovation : Innovation The process by which entrepreneurs convert opportunities into marketable ideas. More than just a good idea. Creativity is the generation of ideas that result in the improved efficiency or effectiveness of a system Slide 49: Creative Process Ideas EvaluationandImplementation Incubation KnowledgeAccumulation The Creative Thinking Process TECHNIQUES FOR CREATIVE PROCESS : TECHNIQUES FOR CREATIVE PROCESS BRAINSTROMING MIND-MAPPING RAPID PROTYPING Processes Associated with the Two Brain Hemispheres : Processes Associated with the Two Brain Hemispheres Left Hemisphere Verbal Analytical Abstract Rational Logical Linear Right Hemisphere Nonverbal Synthesizing Seeing Analogies Nonrational Spatial Intuitive Imaginative PROTECTING YOUR IDEAS : PROTECTING YOUR IDEAS Laws governing intellectual property Patents Copyrights Trademarks Patents Linda Turner : Patents Linda Turner A patent provides the owner with exclusive rights to hold, transfer, and license the production and sale of the product or process. Design patents last for 14 years; all others last for 20 years. Copyrights : Copyrights A copyright provides exclusive rights to creative individuals for the protection of their literary or artistic productions. Duration: life of the author plus 70 years. Trademarks : Trademarks A trademark is a distinctive name, mark, symbol, or motto identified with a company’s product(s) and registered at the Patent and Trademark Office. Trade Secrets : Trade Secrets Customer lists, plans, research and development, pricing information, marketing techniques, and production techniques are examples of potential trade secrets. 26th AUG. 09 : 26th AUG. 09 ENTREPRENEURSHIP DEVELOPMENT PROGRAMMES (EDPs) ENTREPRENEURSHIP DEVELOPMENT PROGRAMMES (EDPs) : ENTREPRENEURSHIP DEVELOPMENT PROGRAMMES (EDPs) Economy is the effect of entrepreneurship Entrepreneurship is the solution the social menaces. EDPs are the solutions to problems of entrepreneurship OBJECTIVES OF EDPs : OBJECTIVES OF EDPs Impart entrepreneurial motivation Environmental scanning Product selection Project formulation Starting new enterprises Understanding sources of support systems Acquiring managerial skill requirements Enabling decision making CURRICULUM OF EDPs : CURRICULUM OF EDPs INTRODUCTION MOTIVATION TRAINING MANAGEMENT SKILLS SUPPORT SYSTEMS PROJECT FEASIBILITY STUDY PLANT VISITS GATEWAYS INTO ENTREPRENEURSHIP : GATEWAYS INTO ENTREPRENEURSHIP Personal & professional skills Information technology Civics Craft , design & technology Sports Analytical and problem solving skills Managerial education Economics ENTREPRENEUR SHIP PHASES OF EDPs : PHASES OF EDPs Pre- training phase Training phase Post-training phase STUDENTS EXERCISES : STUDENTS EXERCISES Describe business What is your dream product/service Who are your customers? Where should you locate the business? How can you attract customers? What is your competition? How much should you charge for the products/service? What advice do you need and who can provide it? Contd. : Contd. How will you organise the managers/workers? How will you split the profits? How much money is needed to start the business? What are your operating costs? (Include yr salary) How much money will your business earn each month? How will you make the business grow in future? 21st Sept 2009 : 21st Sept 2009 Training and Development : Training and Development Training - Provides learners with the knowledge and skills needed for their present jobs Development - Learning that goes beyond today’s job and has a more long-term focus Prepares employees to keep pace with organization as it changes and grows Training vs.Development : Training vs.Development Types of Training : Types of Training Training Development Apprentice- ships On-the-job Training On-the-job Training Needs Assessment Parallel Learning Structures : Organisation Parallel Structure Parallel Learning Structures WHY T&D : WHY T&D Performance improvement To "benchmark” Professional development program Employee be eligible for a planned change in role in the organization To "pilot", or test, the operation of a new performance management system To train about a specific topic TRAINING DOMAIN : TRAINING DOMAIN Communications: Computer skills: Customer service: Diversity: Ethics: Human relations: Quality initiatives: Safety: Sexual harassment: DEVELOPING COMPETENCIES : DEVELOPING COMPETENCIES COMPETENCY RECOGNITION SELF-ASSESSMENT COMPETENCY APPLICATION FEED BACK INNOVATION : INNOVATION Innovation Transformation of ideas into useful application -Results in new products TRANSLATION OF CREATIVE IDEA INTO A USEFUL APPLICATION ANALYTICAL PLANNING ORGANISING RESOURCES IMPLEMENTATION COMMERCIAL APPLICATION Types of Innovation : Types of Innovation Invention Extension Duplication Synthesis Sources of Innovation : Sources of Innovation Unexpected Occurrences Incongruities Process Needs Industry and Market Changes Demographic Changes Perceptual Changes Knowledge-Based Concepts Principles of Innovation : Principles of Innovation DO’S 1 Analysis of opportunities (conceptual) 2 Go out to look, to ask, to listen (perceptual) 3 Simple, focused 4 Capable of being started small 5 Aim at leadership within a given environment. Principles of Innovation : Principles of Innovation DON’T 1 Try to be clever 2 Diversify, splinter, try to do too many things at once 3 Try to innovate for the future. innovate for the PRESENT! CONDITIONS : CONDITIONS 1 Innovation is work. 2 To succeed, innovators must build on their strengths. 3 Innovation is an effect in economy and society. 1st Dec 2009 : 1st Dec 2009 IV UNIT PROJECT UNIT-IV Project Formulation : UNIT-IV Project Formulation Project :The word project comes from the Latin word projectum from projicere, "to throw something forwards" originally meant "something that comes before anything else is done". A scientifically evolved work plan devised to achieve a specific objective within a specified period of time. (There are different schools of thoughts in defining ‘project’) Definitions : Definitions Project management institute USA: “Project is a system involving the co-ordination of a number of separate department entities through the organisation, and which must be completed within prescribed schedules and time constraints” A project is a temporary endeavor undertaken to create a unique product or service. Temporary means that the project has an end date. Unique means that the project's end result is different than the results of other functions of the organization. en.wikipedia.org/wiki/Project Projects : Projects A project is a collection of linked activities carried out in an organised manner with a clearly defined start point and finish point to achieve some specific results that satisfy the needs of an organisation as derived from the current business plans OBJECTIVES : OBJECTIVES STARTING POINT END POINT TIME LIMIT SPECIFIC MEASURABLE REALISTIC WITHIN ORGANISATIONAL RESOURCES LOCATION GOOD RESULT WHY PROJECT? : WHY PROJECT? Some special features exhibited by projects: 1.Rarity of product- The definition of the project’s deliverables are unique Or the conditions of their creation are unique Or both 2.Constraints on process- Time is limited Resources are limited Money is limited SO, Helps the entrepreneur smooth running and setting up of new ventures running without hindrances. PROJECT CLASSIFICATION: : PROJECT CLASSIFICATION: Quantifiable and non-quantifiable projects (Little and Mirrless) Sectoral Projects: Agricultural and Allied sector Irrigation and power sector Industry and Mining sector Transport and communication sector Social Service sector Miscellaneous (The Planning Commission in India) Contd. : Contd. Techno-Economic Projects: Causation-oriented classification Magnitude-oriented classification Factor Intensity-oriented classification Financial Institute Classification New Projects Expansion Project Modernization Projects Diversification Projects Contd. : Contd. Services Projects Welfare Projects Service Projects Research and Development Projects Educational Projects Feasibility Analysis : Feasibility Analysis Economic feasibility, Financial feasibility, Technological Feasibility; Social cost – benefit analysis; Preparation of feasibility report. Economic feasibility : Economic feasibility Market analysis: 4 ps of marketing. Demand and supply analysis. Competitors analysis. Financial feasibility : Financial feasibility Financial statement: Statements of total project cost. Initial capital requirement. Working capital Permanent capital Income statement Cash flows Balance sheets Break –even point Technological Feasibility : Technological Feasibility Technical analysis: Description of the product Manufacturing process Plant size and production schedules Selection of machineries and equipments Availability of raw materials Waste disposal methods Plant layout and estimation of cost Institutions assisting Entrepreneur : Institutions assisting Entrepreneur District Industries Centres (DIC), Small Industries Development Organisations (SIDO), Small Industries Service Institutions (SISI), Financial schemes offered by various financial institutions like Commercial Banks, IDBI, ICICI, SIDBI, Commercial banks and entrepreneurial development, Small Industries Development Organisations (SIDO) : Small Industries Development Organisations (SIDO) Apex body and nodal agency for formulating, coordinating and monitoring SSIs. Development commissioner is the head of the SIDO. It has 27 offices, 31 SISI, 37 Extension centres, 3 product-cum-process development centres, and 4 production centres. FUNCTIONS OF SIDO : FUNCTIONS OF SIDO CO-ORDINATION FUNCTION Evolve national policy for development of SSI Co-ordinate the policies and programmes of state govt. Liasioning related central ministries, planning commission, state govts, financial institutions etc. Co-ordinate the programmes for development of industrial estates. INDUSTRIAL DEVELOPMENT FUNCTION : INDUSTRIAL DEVELOPMENT FUNCTION To reserve items for production by SSIs Collect consumer items imported, help to produce such items Support for development of ancillary units Encourage SSIs to participate in govt. stores purchase programmes. EXTENSION FUNCTION : EXTENSION FUNCTION Technical services for improving technical process, production planning, selection of machinery, lay-out and design. Consultancy and training services Marketing assistances Economic investigation and information DISTRICTS INDUSTIES CENTRES(DICS) : DISTRICTS INDUSTIES CENTRES(DICS) Started on May 8, 1978 1 GM , 4 Functional Managers and 3 Project Managers Registration of ssi Since 1993-1994, DIC s are run by state govt. Functions – PROMOTIOM AND DEVELOPMENT PROMOTIOM AND DEVELOPMENT : PROMOTIOM AND DEVELOPMENT Prepare techno-economic surveys and identify product lines and provide investment advice to entrepreneurs. Prepare action plans to implement the schemes To guide entrepreneurs in every stage of development To appraise the worthiness of various proposals Assist in marketing and export of products Product development works appropriate to entr. Small Industries Service Institutions : Small Industries Service Institutions 28 SISIs and 30 branch SISIs set up in State capitals Serve as interface between central and state govt. Render technical support services Conduct EDPs Initiate promotional programmes Slide 101: Management of SSI Definitions of Micro, Small & Medium Enterprises : Definitions of Micro, Small & Medium Enterprises In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 the Micro, Small and Medium Enterprises (MSME) are classified in two Classes:a) Manufacturing Enterprises : The Manufacturing Enterprise is defined in terms of investment in Plant & Machinery. (b) Service Enterprises: The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment . Investment limit in plant and machinery / equipment for manufacturing / service : Investment limit in plant and machinery / equipment for manufacturing / service Significances: : Significances: The opportunities in the small-scale sector: Less Capital Intensive Extensive Promotion & Support by Government Reservation for Exclusive Manufacture by small scale sector Project Profiles Funding - Finance & Subsidies Machinery Procurement Raw Material Procurement Manpower Training Technical & Managerial skills Tooling & Testing support Reservation for Exclusive Purchase by Government Export Promotion Growth in demand in the domestic market size due to overall economic growth Increasing Export Potential for Indian products Growth in Requirements for ancillary units due to the increase in number of Greenfield units coming up in the large scale sector. RESERVATION POLICY : RESERVATION POLICY Reservation of products for exclusive manufacture in the small scale sector was introduced for the first time in 1967 with the reservation of 47 items. February, 1970 - 55 February, 1971 - 128 November, 1971 - 124 February, 1974 - 177 June, 1976 - 180 April, 1978 - 504 RESERVATION POLICY : RESERVATION POLICY After the introduction of National Industrial Classification (NIC) code the list was recast. 504 to 807 in 1978 836 in 1989. As of March, 2007, 114 items are reserved for exclusive manufacture in the small scale sector. Source: Management of SSI : Management of SSI creating organizing planning controlling communicating motivating Decision making Managing Enterprises: : Managing Enterprises: Small Industries can fail due to many reasons which may or may not be due to the entrepreneurs. Entrepreneurs have to constantly update and sharpen their management skills w.r.t man, materials, machinery, market & money. Modernization & Technology Up gradation: Small Enterprises constantly spring up based on technology of the Times. There is ever increasing of competition to Grow as survival strategy alone is not enough. As we keep moving into the future there is constant attempt to improve the quality of products and services simultaneously reducing the prices to lure the customers. As the customer is the king, nothing is spared to attract and retain them. Therefore the need to modernize and upgrade technology in all areas of the enterprise . GENERAL POLICIES : GENERAL POLICIES Policy of Reservation Price & Purchase Preference Reservation of Items Licensing In case of the small units which employ less than 50 workers with power or less than 100 workers without power are not required to obtain any license under Compulsory Licensing Provisions. Trade Policy (Special Import License (SIL) ) Foreign Direct Investment Approval NRI Investment Approval Foreign Investment Regulations Labor Policies You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.