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Entrepreneurship
DevelopmentIntroduction
Entrepreneurship is one ofthe four mainstreameconomic factors: Land,
Labour, capital, andentrepreneurship. Theword itself is derived from
the french word
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Entrepreneurship is the purposefulactivit" of an individual or a #roup ofassociated individuals, undertaen to
initiate, maintain pro$t b" production ordistribution of economic #oods andservices.
% &. '. (ole
Entrepreneurship is based on purposefuland s"stematic innovation. It included notonl" the independent businessman but alsocompan" directors and mana#ers who
actuall" carr" out innovative functions.% )chumpeter
Entrepreneurship is the d"namic processof creatin# incremental wealth.
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TheEntrepreneu
r*ichard (antillon, was the $rst whointroduced the term entrepreneur .
The term entrepreneur is broadl"classi$ed into three #roups:
-
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Investment
Transformation
ro$t orloss
Entrepreneurbu"s farmproduce at
certain prices
Entrepreneurrepacs and
transports farmproduce to
maret
Entrepreneursells food
produce in cit" atuncertain prices
/i#ure: (antillons Earl" view ofEntrepreneurial 0ehaviour
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1 &s an 2r#aniser: &n entrepreneur is onewho combines the land of one, thelabour of another and the capital of "etanother, and thus, produces a product.
% 3ean 0aptiste
4 &s an innovator: Economic development
as a discrete d"namic chan#e brou#htb" entrepreneur b" institutin# newcombinations of production i.e.innovations.
% 3oseph &. )chumpeter
Thus, an entrepreneur can be de$ned as aperson who tries to create somethin#new , or#anises production andundertaes ris and handles economic
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Emer#ence of
Entrepreneurial (lassEarliest eriod: contractors witha mone" person 5forerunner of
toda"s venture capitalist, e#:traders, merchants
6iddle es: & person who
mana#ed lar#e production pro7ects.E#: (leric - the person inchar#e of#reat architectural wors
+8th
(entur": &s a ris taer,bu at a certain rice and sell at an
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+9th(entur": (apital users, not capitalproviders 5 the present - da" venture
capitalist
+thand 1;th(enturies: 6ana#ers ,&s an Innovator
?arhanas
) @ueen of International Trade in +9th
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1 Durin# ost%
Independence:articularl" since the Third /iveAear lan - small entrepreneurs
)mall to medium - scale, mediumto lar#e - scale manufacturin#.E#: Tata, 0irla, 6afatlal, Dalmia,
?irlosar
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(haracteristics 2f &nEntrepreneur
1.Hard Work
2.Desire for High Achievement
3.Highly Optimisitc
4.Independence
.!oresight
".#ood Organiser
$.Innovative
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Distinction 0etween anEntrepreneur and a 6ana#er
+. 6otive
1. )tatus
4. *is - 0earin#
B. *ewards
C. Innovation
. @uali$cations
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T"pes 2fEntrepreneurs
+. Innovative Entrepreneurs
1. Imitative > &doptive
Entrepreneurs
4. /abian Entrepreneurs
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)ome 6ore T"pes 2f Entrepreneurs
+. )olo 2perator
1. 0" Inheritance
4. Tradin#
B. Industrial
C. ricultural
. Technical
8. on%technical
9. /irst
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(oncept 2f
Intrapreneurs>(orporate
Entrepreneur%
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*elationship 0etweenEntrepreneur and
EntrepreneurshipEntrepreneur Entrepreneurship
%erson
OrganiserInnovator&isk ' (earer
)otivator*reator+is,aliser-eaderImitator
%rocess
OrganisationInnovation&isk ' (earing
)otivation*reation+ision-eadershipImitation
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Drucers Hiews on Entrepreneur
An entrepreneur is the one who always searches for change,
responds to it and exploits it as an opportunity. Innovation is
the specic tool of entrepreneurs, the means by which they
exploit changes as an opportunity for a dierent business or
dierent service
&dam )mith
The entrepreneur is an individual who forms an organiation for
commercial purpose. !e " #he is proprietary capitalist, a
supplier of capital and at the same time a manager who
intervenes between the labor and the consumer.
$ntrepreneur is an employer, master, merchant but explicitly
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According to .(.say/ 0ntreprene,r is an conomic agent to ,nitesall the means of prod,ction An entreprene,r is an individ,al hotakes moderate risks and rings innovation.
E:5amine needs/ ants/ and prolems to see ho they canimprove the ay needs and ants are met and prolemsovercome.: arro the possile opport,nities to one speci6c 7est7
opport,nity.T:hink of innovative ideas and narro them to the 7est7 idea.*:esearch the opport,nity and idea thoro,ghly.E:nlist the est so,rces of advice and assistance that they can6nd.:lan their vent,res and look for possile prolems that might
arise.*:ank the risks and the possile reards.E:val,ate the risks and possile reards and make their decisionto act or not to act.:ever hang on to an idea/ no matter ho m,ch they may love it/if research shos it on8t ork.
E:mploy the reso,rces necessary for the vent,re to s,cceed.:nderstand that they ill have to ork long and hard to make
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8 e" @ualities of Entrepreneur
All s,ccessf,l entreprene,rs have the folloing :,alities;
1. Inner Drive to
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0arriers to entrepreneurship
Economic barriers
(apitalLabour
*aw material
on%economic barriers
(ultural bloc
ractical values
Importance of lo#ic
*espect for entrepreneurs
Tradition 0indin#
Emotional bloc
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ersonal barriers to entrepreneurship
Lac of sustained motivation
DiJcult" with ambi#uit"5orderlinessInabilit" to dream and use subconscious
Impatience in solvin# problems
*is &voidance5anal"sin# how to #et
thin#s done rather than worr"in# about
what to do if the" fail
Lac of (lear perception5Tunnel vision%
i#nore the obvious
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Entrepreneurial barriers for speci$c#roups
=omen Entrepreneurs
/amil" Ties )ocial attitude towards women Low mobilit"0arriers for minorit" #roups )ame as barriers for ma7orit"
communit"
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otential drawbacs ofentrepreneurship
?ncertainty of income
&isk of losing entire investment
-ong ho,rs and hard ork
High levels of stress
*omplete responsiility
Disco,ragement
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=hat attracts theentrepreneurs
ntreprene,rs as heroes
ntreprene,rial ed,cation
Demographic and economic factors
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0ene$ts of entrepreneurship
Opport,nity to create yo,r on destiny
Opport,nity to make a diBerence
Opport,nity to reach yo,r f,ll potential
Opport,nity to reap impressive pro6ts
Opport,nity to contri,te to society and erecogni9ed for yo,r eBorts
Opport,nity to do hat yo, en>oy and havef,n at it
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The cultural diversit" ofentrepreneurs
Co,ng entreprene,rsWomen entreprene,rs)inority entreprene,rsImmigrant entreprene,rsDon *hang!orever21E%arttime entreprene,rsoe *armen
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+; deadl" mistaes ofentrepreneurship
)anagement )istakes
-ack of e5perience
%oor !inancial *ontrol
Weak )arketing eBorts
!ail,re to develop a strategic plan
?ncontrolled groth
%oor location
Improper inventory control
Incorrect pricing
Inaility to make 0ntreprene,rial transition
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Deadl" 6istaes
We have a great prod,ct or serviceG It ill
sell itself.With a market this ig/ e only need a tinyshare of it to ecome rich.
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Deadl" 6istaes
-et ,s go ith the location. I kno its oB the
eaten path/ ,t its so m,ch cheaper.*omp,terF I dont kno anything ao,tcomp,ters. A legal pad and an addingmachine are all I need to manage my,sinessFWe are so small here. veryody knos hat
o,r goals and o>ectives are.@his ,siness is so easy it ill r,n itself.Of co,rse o,r c,stomers are satis6edF I neverhear them complain.What do yo, mean e are o,t of cashG Wehave een making a pro6t for months no/
and sales are groing.
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'ow to avoid the pitfalls
Jno yo,r ,siness in depth
Develop a solid ,siness plan
)anage !inancial reso,rces
?nderstand !inancial
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