Iv sem ed module 01.

Entrepreneur.
ENTREPRENEURSHIP DEVELOPMENT.
IV SEMESTER MBA.
Module 01.
VTU Syllabus.
GSSSIETW IMS MYSORE
P.K.KUMAR
1

Meaning of Entrepreneur.
• An entrepreneur is a person who starts an enterprise. He searches for
change and responds to it.
• A number of definitions have been given of an entrepreneur- The
economists view him as a fourth factor of production along with land,
labour and capital.
• The sociologists feel that certain communities and cultures promote
entrepreneurship like for example in India we say that people from
Gujarat and Sind are very enterprising.
• Still others feel that entrepreneurs are innovators who come up with new
ideas for products, markets or techniques.
GSSSIETW IMS MYSORE
P.K.KUMAR
2

Meaning of Entrepreneur.
• To put it very simply an entrepreneur is someone
who perceives opportunity, organizes resources
needed for exploiting that opportunity and
exploits it.
• Computers, mobile phones, washing machines,
ATMs, Credit Cards, Courier Service, and Ready to
eat Foods are all examples of entrepreneurial
ideas that got converted into products or
services.
• Some definitions of an entrepreneur are listed
below:
GSSSIETW IMS MYSORE
P.K.KUMAR
3

Definition of Entrepreneur.
• Stems: from the French word ‘entrependre’ meaning one who undertakes
or one who is a ‘go-between’
• Richard Cantillon: An entrepreneur is a person who pays a certain price
for a product to resell it at an uncertain price, thereby making decisions
about obtaining and using the resources while consequently admitting the
risk of enterprise.
• According to J B Say, an entrepreneur is “one who combines the land of
one, the labor of another, the capital of yet another and thus produces a
product”. By selling the product in the market, he pays interest on capital,
rent on land, wages to the labor and what remains is his profits. A close
look at this definition Say emphasizes the functions of co-ordination,
organisation, and supervision. Thus entrepreneur is an organizer.
GSSSIETW IMS MYSORE
P.K.KUMAR
4

Meaning of Entrepreneurship
• According to Peter F Drucker “ Entrepreneur is one who
considers the changes that take place in the market as an
opportunity to do business. Innovation is his tool. He further
states that entrepreneur need to search purposefully for the
sources of innovation, the changes and their symptoms that
indicates opportunities for successful innovation. And they
need to know and to apply the principles of successful
innovation. Here the definition seem to suggest:
• Innovation work,
• Success based on strength / hard work,
• Activity close to market, focus on the market and every thing
else is market driven.
GSSSIETW IMS MYSORE
P.K.KUMAR
5

Evolution of the Concept.
• In olden days the builders of forts for the king
were called ‘entrepreneurs’. It was believed
that such builders required skills of special
nature & that the forts built by them would
lost longer & stronger. Thus people who were
capable of delivering any thing to society
which was novel & that required special skill
to develop were started to be called
entrepreneurs.
GSSSIETW IMS MYSORE
P.K.KUMAR
6

Qualities of Entrepreneur.
• Mental Ability,
• Organizing skills,
• Hard Work,
• Discipline,
• Clear goals,
• Desire to Achieve,
• Optimistic,
• Ready to take risk,
• Good at HR,
• Emotional Stability,
• Communication ability,
• Self-Confidence,
• Adaptability,
• Positive Attitude.
GSSSIETW IMS MYSORE
P.K.KUMAR
7

Functions of an Entrepreneur.
• Market research,
• Idea Generation,
• Product/service analysis,
• Form of business,
• Determination of business objectives,
• Promotional formalities,
• Raising the Capital,
• Providing Infrastructure,
• Selection of human resource,
• Carrying out the Operations,
• Risk bearing,
• Organisation.
• Innovation,
• Exploration of new opportunity,
• Providing Leadership.
GSSSIETW IMS MYSORE
P.K.KUMAR
8

Types of Entrepreneurs.
• Based on Business Type; Trading,
• Industrial,
• Corporate,
• Agricultural,
• Based on Skills; Technical,
• Non-Technical,
• Based on Motivation: Pure,
• Motivated,
• Based on Growth; Growth oriented,
• Non growth oriented,
• Based on Scale/Size; Small,
• Medium,
• Large
•
GSSSIETW IMS MYSORE
P.K.KUMAR
9

Types of Entrepreneurs.
• Based on founder: First Generation,
• Inherited,
• Based on Gender: Men,
• Women,
• Based on Study: Innovative,
• Imitative,
• Fabian,
• Drone,
• Other types; Public,
• Private,
• Forced,
• Artisan.
GSSSIETW IMS MYSORE
P.K.KUMAR
10

Intrapreneurs.
A person within a large corporation who takes
direct responsibility for turning an idea into a
profitable finished product through assertive
risk taking and innovation.
Intrapreneurs have entrepreneurial skills
blended with managerial skills but operate
within the confines of an organization.
GSSSIETW IMS MYSORE
P.K.KUMAR
11

Intrapreneurs & Enterpreners.
• Dependant Vs Independent,
• No risk Vs risk,
• Salary Vs Reward,
• Qualified Vs may or may not be qualified,
• Restricted area of operation Vs limitless
• boundary for operation,
• No high achievement desire Vs desire to
achievement,
GSSSIETW IMS MYSORE
P.K.KUMAR
12

Entrepreneurs Vs Managers.
Entrepreneur Manager
========================================
An entrepreneur is involved A manager with running the
With the start-up process business over a long period
of time
------------------------------------------------------------------------
An entrepreneur assumes A manager does not have to
financial, material and bear risks,
psychological risks
------------------------------------------------------------------------
An entrepreneur is driven by A manager by the resources
perception of opportunity he currently possesses,
----------------------------------------------------------------------
An entrepreneur is his own A manager follows rules & boss,
procedures,
----------------------------------------------------------------
An entrepreneur gets A manager gets fixed
uncertain rewards, rewards,
====================================
GSSSIETW IMS MYSORE
P.K.KUMAR
13

Concept of Entrepreneurship.
• Entrepreneurship can be described as a process of action an
entrepreneur undertakes to establish his enterprise.
Entrepreneurship is a creative activity. It is the ability to
create and build something from practically nothing. It is a
knack of sensing opportunity where others see chaos,
contradiction and confusion. Entrepreneurship is the attitude
of mind to seek opportunities, take calculated risks and derive
benefits by setting up
a venture. It comprises of numerous activities involved in
conception, creation and running an enterprise.
14

• According to Peter Drucker Entrepreneurship is defined as ‘a
systematic innovation, which consists in the purposeful and
organized search for changes, and it is the systematic analysis of
the opportunities such changes might offer for economic and social
innovation.’
• Entrepreneurship is a discipline with a knowledge base theory. It is
an outcome of complex socio-economic, psychological,
technological, legal and other factors. It is a dynamic and risky
process. It involves a fusion of capital, technology and human
talent.
• Entrepreneurship is equally applicable to big and small businesses,
to economic and non-economic activities.
15

• Different entrepreneurs might have some common traits but
all of them will have some different and unique features. If
we just concentrate on the entrepreneurs then there will be
as many models as there are ventures and we will not be able
to predict or plan, how and where, and when these
entrepreneurs will start their ventures. Entrepreneurship is a
process. It is not a combination of some stray incidents. It is
the purposeful and organized search for change, conducted
after systematic analysis of opportunities in the environment.
16

• Entrepreneurship is a philosophy- it is the way
one thinks, one acts and therefore it can exist
in any situation be it business or government
or in the field of education, science and
technology or poverty alleviation or any
others.
17

Development of Entrepreneurship.
• Economic development does not occur automatically. It mainly depends
on the utilization of available resources which in turn depends on the
number & quality of entrepreneurs. Thus there is a direct relationship
between economic development & entrepreneurship. Earlier there was a
belief that entrepreneurs are born and not made. Emergence of
entrepreneurs in a few restricted castes and regions of people more often
than others, perhaps, made this belief stronger. Many economists &
sociologists have done research in the area to know what makes an
individual an entrepreneur. One such study by David McClelland brought
to lime light that a strong individual desire to achieve high as one of the
reasons not withstanding the non business background. Thus now it is a
known facts that entrepreneurs can be made besides those born.
18

Development of Entrepreneurship.
• Entrepreneurship is now developed through education.Usually the model
used for entrepreneurial education has three phases:
• Stimulatory Phase- This phase involves planned publicity for
opportunities, motivation training and help and guidance in selection of
product or service.
• Support Phase- This provides help in registration of units, arrangement of
finance as well as land, sheds, power, water, common facility centres etc.
Help is also provided in marketing of products.
• Sustenance Phase- Once the enterprise is set up then help is provided for
modernization, diversification, additional finance etc.
19

Entrepreneurial Culture
Culture can be defined as the mix of norms,
values and beliefs that are shared by a
particular community [be it a business
community, a cultural (or ethnic) community,
a country, or a geographical region].
20

Cultural Values
• Linton (1975) describes values as a predisposition to act in a certain way.
• Values of entrepreneurs:
According to Sexton & Bowman (1986), entrepreneurship is a value in
itself for Americans. Different authors suggest different values for
entrepreneurs:
• Kets de Vries (1984): reputation, power, status and recognition
Gordon Survey of values (1976): independence, efficacy and a negative
reaction to affiliation.
• There is a general presumption that a society may have potential
entrepreneurs, but only becomes entrepreneurial if it has a culture that
supports innovation and initiative.
21

Cultural Attitudes
• According to J. M. Toulouse (1990), entrepreneurial culture is favored by the
following set of attitudes:
1. Business activities are valued.
2. Individual and collective initiatives are highly rated.
3. Determination and perseverance are desirable qualities.
4. An equilibrium between security and risk is accepted.
5. The tension between stability and change is resolved.
Therefore, in a society favoring entrepreneurship, entrepreneurs
are role models who are not only acceptable, but desirable.
22

• According to Prosek, the key to unleashing that creative energy is to create an
entrepreneurial culture based on four pillars.
• Authenticity -- Demonstrate your sincerity by being enthusiastic about
entrepreneurial strategies and actions pursued by the business.
• Commitment to People – “An entrepreneurial culture is based on the idea that each
individual can be a powerful force for change in the organization,” said Prosek.
Support the professional development of your staff, celebrate exceptional work,
and don't forget to have fun.
• Commitment to the Business -- Align an individual's interests with those of the
business. “
• Continuous Effort -- The work of building a company’s culture never ends.
*Prosek Partners, New York
23

Sustaining an entrepreneurial culture starts with who you hire.
It is essential to carefully screen prospective employees to
ensure that they will fit within your culture. An
entrepreneurial culture is also sustained by your reward
system, by the autonomy and respect you give to your
employees, and by consistent communication about your
ongoing entrepreneurial vision for the company.
24

Steps in the Entrepreneurial Process
1. Discovery
2. Concept
Development
3. Resourcing
4. Actualization
5. Harvesting

Steps in the Entrepreneurial Process
1. Discovery: The stage in which the
entrepreneur generates ideas,
recognizes opportunities, and studies
the market
Innovation
Opportunity

Discovery
Consider your
hobbies or skills
Consider consumer
needs and wants
Conduct Surveys and
questionnaires – test the
market
Study demographics

There are five basic questions that you should ask as you
evaluate an opportunity.
• Is there a sufficiently attractive market opportunity?
• Is your proposed solution feasible, both from a market
perspective and a technology perspective?
• Can we compete (over a sufficiently interesting time
horizon): is there sustainable competitive advantage?
• Do we have a team that can effectively capitalize of
this opportunity?
• What is the risk / reward profile of this opportunity,
and does it justify the investment of time and money?
29

Steps in the Entrepreneurial
Process
2. Concept Development:
– Develop a business plan: a
detailed proposal describing
the business idea
Executive summary
Code of ethics
Mission Statement

Concept Development
– Choose business location
– Will a patent or trademark be required?

Process
3. Resourcing: The stage in which the
entrepreneur identifies and acquires
the financial, human, and capital
resources needed for the venture
startup, etc
Start-up resourcesStart-up resources

Resourcing
Identify potentialIdentify potential
investorsinvestors
HireHire
employeesemployees
Apply for loans,Apply for loans,
grants andgrants and
assistanceassistance

Process
4. Actualization: The stage in which
the entrepreneur operates the
business and utilizes resources to
achieve its goals/objectives.
$$ Grand Opening $$
Day-to-Day Operations

Process
5. Harvesting: The stage in which the
entrepreneur decides on venture’s
future growth, development, or
demise
What is your 5-year or 10-year plan?
Consider adding locations or providing different
products/services
Will you go public?

You are collecting, reviewing, and interpreting
surveys you distributed last week about your new
business idea. What stage of the entrepreneurial
process are you in?
A.A. ActualizationActualization
B.B. Concept DevelopmentConcept Development
C.C. DiscoveryDiscovery
D.D. HarvestingHarvesting

You are currently seeking people and companies
to invest in your business venture. What stage of
the entrepreneurial process are you in?
D.D. ResourcingResourcing

What is an example of an activity for a business
person who is entering the harvesting stage of
entrepreneurship?
A.A. Considering opening a second storeConsidering opening a second store
B.B. Gathering market research data about theGathering market research data about the
productproduct
C.C. Having a grand opening for the businessHaving a grand opening for the business
D.D. Seeking financial assistance from the SmallSeeking financial assistance from the Small
Business AdministrationBusiness Administration

Preparing a business plan for a new business,
renting a building for the new store, and
copyrighting the website for the new business are
all classified as which stage of the entrepreneurial
process?

Offering shares of stock to public investors and
planning goals for the business during the next
five years are examples of activities in which stage
of the entrepreneurial process?
C.C. HarvestingHarvesting

Having a large grand opening sale or a summer
clearance sale are examples of which stage of the
entrepreneurial process?
C.C. HarvestingHarvesting

Iv sem ed module 01.

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (20)

Andere mochten auch

Andere mochten auch (16)

Ähnlich wie Iv sem ed module 01.

Ähnlich wie Iv sem ed module 01. (20)

Iv sem ed module 01.