Enterprise, Entrepreneurs

and Entrepreneurship
Enterprise
 A business
 A company
 The word enterprise describes the actions of someone who
shows some initiative by taking a risk by setting up, investing
in and running a business.
 Economic organizations responsible for production,
distribution or another function
 Who is an entrepreneur?
 What is entrepreneurship?
 What is an entrepreneurial process?
https://www.youtube.com/watch?
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https://www.youtube.com/watch?v=92ZmzD7
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https://www.youtube.com/watch?v=Kja2TQgF
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Entrepreneur
• To an economist, an entrepreneur is one who brings resources, labor,
materials, and other assets into combinations that make their value greater
than before, and also one who introduces changes, innovations, and a new
order
• To a psychologist, such a person is typically driven by certain forces—the
need to obtain or attain something, to experiment, to accomplish, or
perhaps to escape the authority of others.
• To one businessman, an entrepreneur appears as a threat, an aggressive
competitor, whereas to another businessman the same entrepreneur may
be an ally, a source of supply, a customer, or someone who creates wealth
for others, as well as finds better ways to utilize resources, reduce waste,
and produce jobs others are glad to get.
a kind of behavior that includes:
 initiative taking,
 the organizing and reorganizing of social and economic
mechanisms to bundle resources in innovative ways, and
 the acceptance of risk, uncertainty and/or the potential for
failure
 entrepreneurs respond to, and create, change through their
entrepreneurial actions, where entrepreneurial action refers to
behavior in response to a judgmental decision under
uncertainty about a possible opportunity for profit
Characteristics of an entrepreneur

 Hard work
 Desire for high achievement
 Highly optimistic
 Independence
 Foresight
 Good organizer
 innovative
Qualities of entrepreneurs
 Self motivated
 Self confidence
 Ethics and moral
 Time management
 Administrative skills
 Financial knowhow
 Vision and leadership skills
 Conflict and consensus management skills
 Interpersonal skills
 Communication skills
 Problem solving skills
 Technical skills
 Types of entrepreneurs
Based on functional
characteristics
According to the Type of Business
Business Entrepreneur
Trading Entrepreneur
Industrial Entrepreneur
Corporate Entrepreneur
Agricultural Entrepreneur
According to the Technology use
 Technical Entrepreneur
 Non-technical Entrepreneur
 Professional Entrepreneur
According to the level of Motivation
 Pure Entrepreneur
 Induced Entrepreneur
 Motivated Entrepreneur
 Spontaneous Entrepreneur According to the area
• Urban entrepreneur
• Rural entrepreneur
necessity-based
opportunity-based entrepreneurs
Technopreneur
Functions of entrepreneur
 Idea generation: environmental scanning and market survey
 Determination of objectives: clarity with the nature and type of the
business
 Fund raising
 Procurement of raw materials
 Procurement of machinery
 Market research
 Determination of form of enterprise
 Recruitment of manpower
 Implementation of project
Entrepreneurship
Entrepreneurship is the process of creating something
new with value by devoting the necessary time and
effort; assuming the accompanying financial, psychic,
and social risks and uncertainties; and receiving the
resulting rewards of monetary and personal satisfaction.
It is the process of searching out opportunities in the
marketplace and arranging resources required to exploit
these opportunities for long-term gains.
Entrepreneurial decision process

1. Change from present life style

2. Desirability of new venture formation
3. Possibility of new venture formation
Need of Entrepreneurial development
 Balanced regional development
 Increase in national income
 Bringing change in structure of business and society
 New products, services and new business
 Knowledge and social need filling
 Better standards of living
 Creating innovation
 Production evolution process
 Enhancing welfare amenities
Advantages of Entrepreneurship
 CONTROL. You choose the work you like to do and that makes the most
of your strengths and skills. The result can be more job satisfaction.
 EXCITEMENT. Entrepreneurship can be exciting and many
entrepreneurs consider their work highly enjoyable. Each day is filled with
new opportunities to challenge your abilities, skills, and determination.
 FLEXIBILITY. Entrepreneurs can schedule their work hours around
other commitments, including spending quality time with their families.
 FREEDOM. Freedom to work whenever they want, wherever they want,
and however they want draws many to entrepreneurship. Most
entrepreneurs don’t consider their work actual work because they are
doing something they love.
 RATIONAL SALARY. As an entrepreneur, your income is directly
related to your efforts and the success of your business.
Disadvantages of Entrepreneurship
 ADMINISTRATION. While making all the decisions can be a benefit, it can
also be a burden. Being an entrepreneur comes with a lot of paperwork that
can take up time and energy.
 COMPETITION. Staying competitive is critical as a small business owner.
You will need to differentiate your business from others like yours in order to
build a solid customer base and be profitable.
 LONELINESS. It can be lonely and scary to be completely responsible for
the success or failure of your business.
 NO REGULAR SALARY. Being an entrepreneur often means giving up the
security of a regular paycheck. If business slows down, your personal income
can be at risk.
 WORK SCHEDULE. The work schedule of an entrepreneur can be
unpredictable. A major disadvantage to being an entrepreneur is that it requires
more work and longer hours than being an employee.
Barriers to entrepreneurship
1. Economic barriers:
◦ Capital and credit access
◦ Labor
◦ Raw materials
◦ Excessive complex and arbitrary taxation
2. Non economic barriers
◦ Social barriers: emotional block, Indian cultural
values, defective tax structures
◦ Personal barriers: difficulty and ambiguity,
impatience in solving problems
THE ENTREPRENEURIAL PROCESS
 The process of pursuing a new venture is embodied in the
entrepreneurial process, which involves more than just problem
solving in a typical management position.
 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
Identify and Evaluate the
Opportunity
 Opportunity identification and evaluation is a very difficult task. Most
good business opportunities do not suddenly appear, but rather result from
an entrepreneur’s alertness to possibilities or, in some cases, the
establishment of mechanisms that identify potential opportunities
 Although most entrepreneurs do not have formal mechanisms for
identifying business opportunities, some sources are often fruitful:
consumers and business associates, members of the distribution system,
and technical people
 Whether one identifies the opportunity by using input from consumers,
business associates, channel members, or technical people, each
opportunity must be carefully screened and evaluated. This evaluation of
the opportunity is perhaps the most critical element of the entrepreneurial
process, as it allows the entrepreneur to assess whether the specific
product or service has the returns needed compared to the resources
required
 The market size and the length of the window of opportunity are the
primary bases for determining the risks and rewards. The risks reflect the
market, competition, technology, and amount of capital involved. The
amount of capital needed provides the basis for the return and rewards.
 the opportunity must fit the personal skills and goals of the entrepreneur. It
is particularly important that the entrepreneur be able to put forth the
necessary time and effort required to make the venture succeed.
 An entrepreneur must believe in the opportunity so much that he or she
will make the necessary sacrifices to develop the opportunity and manage
the resulting organization.
 Opportunity analysis, or what is frequently called an opportunity
assessment plan, is one method for evaluating an opportunity. It is not a
business plan.
 Compared to a business plan, it should be shorter; focus on the
opportunity, not the entire venture; and provide the basis for making the
decision of whether or not to act on the opportunity
 An opportunity assessment plan includes the following: a description of
the product or service, an assessment of the opportunity, an assessment of
the entrepreneur and the team, specifications of all the activities and
resources needed to translate the opportunity into a viable business
venture, and the source of capital to finance the initial venture as well as
its growth
 The assessment of the opportunity requires answering the following
questions:
 What market need does it fill?
 What personal observations have you experienced or recorded with regard
to that market need?
 What social condition underlies this market need?
 What market research data can be marshaled to describe this market need?
 What patents might be available to fulfill this need?
 What competition exists in this market? How would you describe the
behavior of this competition?
 What does the international market look like?
 What does the international competition look like?
 Where is the money to be made in this activity?
Develop a Business Plan
 It is a well defined written argument based on facts and figures and
estimates. It portrays an overall picture of a business proposal, attempts
to justify feasibility as well as commercial success and makes it clear
suggested course of actions in distinguished sections.
 A good business plan must be developed to exploit the defined
opportunity
 A good business plan is essential to developing the opportunity and
determining the resources required, obtaining those resources, and
successfully managing the resulting venture.
Determine the Resources
Required
 This process starts with an appraisal of the entrepreneur’s present resources
 The next step in the entrepreneurial process is acquiring the needed
resources in a timely manner while giving up as little control as possible. An
entrepreneur should strive to maintain as large an ownership position as
possible, particularly in the start-up stage.
 As the business develops, more funds will probably be needed to finance the
growth of the venture, requiring more ownership to be relinquished. The
entrepreneur also needs to identify alternative suppliers of these resources,
along with their needs and desires
Manage the Enterprise
 After resources are acquired, the entrepreneur must use them to implement
the business plan. The operational problems of the growing enterprise
must also be examined.
 This involves implementing a management style and structure, as well as
determining the key variables for success.
 A control system must be established so that any problem areas can be
quickly identified and resolved. Some entrepreneurs have difficulty
managing and growing the venture they created.
Identify and Evaluate Develop Business Plan Resources Manage the Enterprise
the Opportunity Required

Opportunity assessment Title page Determine Develop management style

Creation and length of Table of Contents resources needed Understand key variables for
opportunity Executive Summary Determine success
Real and perceived value of Major Section existing resources Identify problems and
opportunity Description of Business Identify resource potential problems
Risk and returns of Description of Industry gaps and available Implement control systems
opportunity Technology Plan suppliers Develop growth strategy
Opportunity versus personal Marketing Plan Develop access
skills and goals Financial Plan to needed
Competitive environment Production Plan resources
Organization Plan
Operational Plan
Summary
Factors Influencing
Entrepreneurial Development
1. Economic factors:
• Availability of resources
• Economic conditions
• Economic policies
• Labor policies
• Trade policy
• Tariff policy
• Incentives
• Subsidies
2. Non economic factors:
• Social factors
• Cultural factors
• personality factors
• Technological factors
• Educational factors
• motivation
Entrepreneurs versus
manager
BASIS FOR
ENTREPRENEUR MANAGER
COMPARISON

Meaning Entrepreneur refers to a person Manager is an individual who

who creates an enterprise, by takes the responsibility of
taking financial risk in order to controlling and administering the
get profit. organization.
Focus Business startup Ongoing operations

Primary Achievement Power

motivation

Approach to task Informal Formal

Status Owner Employee

Reward Profit Salary

Entrepreneurs versus
manager
BASIS FOR
ENTREPRENEUR MANAGER
COMPARISON

Decision making Intuitive Calculative

Driving force Creativity and Innovation Preserving status quo

Risk orientation Risk taker Risk averse

He needs to possess qualities

He needs to possess distinct
and qualifications like high
qualifications sound knowledge
Qualification achievement motive, originality
of management theory and
in thinking, foresight, risk
practices
bearing ability
Innovation He thinks over what and how to He simply executes the plans
produce goods to meet the prepared by the entrepreneur.
changing demands of the
customers. He acts an innovator
: change agent”
Intrapreneur/ corporate
entrepreneurs
 These are employees within a company who are assigned a
special idea, or project and are instructed to develop the
project like an entrepreneur would.
 They usually have the resources and capabilities of the firm at
their disposal.
 His main job is to turn that special idea or project into a
profitable venture for the company.
Characteristics of intrapreneur
 Need to achieve goals
 Understands the environment
 Visionary
 Locus of control
 Creates management options
 Analytical ability of mind
 Teamwork
 Stress takers
 Open discussion
 builds supporters
 Decision making
 Ability to mobilize resources
Importance of intrapreneur

 Performance
 Learning process
 Employee retention
 Corporate renewal and organizational change
 Capability building
Intrapreneur vs entrepreneur
Bases of Entrepreneur Intrapreneur
Difference
Dependency An entrepreneur is independentBut, an intrapreneur is dependent on
in his operations. the entrepreneur, i.e., the owner.
Raising of Funds An entrepreneur himself raisesFunds are not raised by the
funds required for the enterprise. intrapreneur.
Risk Entrepreneur bears the riskAn intrapreneur does not fully bear
involved in the business. the risk involved in the enterprise.
Operation An entrepreneur operates fromOn the contrary, an intrapreneur
out-side. operates from within the
organization itself.

Entrepreneur runs a small

Intrapreneurship is the act of
business and assumes all the
behaving like an entrepreneur
Description risk and reward of a given
while working within a large
business venture, idea, or good
organization.
or service offered for sale
 Intrapreneur vs entrepreneur
Bases of Entrepreneur Intrapreneur
Difference

Entrepreneur is commonly seen as a An Intrapreneur is also commonly seen

Seen as business leader and innovator of new as a business leader and innovator of new
ideas and business processes ideas and business processes

independence Independent, runs own business Works for a company or another person

Has to source the resources and

capabilities from outside, whether Has the resources and capabilities of the
Resources that includes getting a business loan, company who they work for at their
getting investors, or hiring staff and disposal.
purchasing resources.
Time There is no time bound. Self-imposed or organization stipulated
orientation time limits.
Focus of Increasing sales and sustaining Technology and market.
attention competition.
Intrapreneur vs. entrepreneur
Bases of Entrepreneur Intrapreneur
Difference
Core objective To innovate something new of To increase competitive strength and
socio economic value. market sustainability of the
organization.
Failure and Recognizes mistake and failures Keeps risky projects secret unless it
mistakes so as to take new innovative is prepared due to high concern for
efforts. failure and mistakes.
Decisions Independent decisions to execute Collaborative decisions to execute
dreams. dreams.
Whom serves Customers and entrepreneur Organization and intrapreneur
himself. himself.
Family Professional or small business May not have or a little professional
heritage family heritage post.
Relationship Basic relationship based on Authority structure delineates the
with others interaction and negotiation. relation
How to create intrapreneur
 Cross functional problem solving war rooms
 Encourage trial and error- failure allowed
 ESOPS , rewards
 Support of the top management
 Personal mentoring around goal orientation
 Customer centricity
 Every performance should be rewarded
 Carrot and stick method
 More incentives
 Share financial success
Keyword for intrapreneurs

 Firstly enable them

 To become opportunity scanners
 producers
 Become their advocates
HOW ENTREPRENEURS THINK
 Given the nature of an entrepreneur’s decision-making
environment, he or she must sometimes
1. effectuate,
2. be cognitively adaptable, and
3. learn from failure.
Effectuation
 entrepreneurs do not always think through a problem in a way
that starts with a desired outcome and focuses on the means to
generate that outcome. Such a process is referred to as a
causal process.
 which means they take what they have (who they are, what
they know, and whom they know) and select among possible
outcomes : Effectuation
Cognitive Adaptability
 Cognitive adaptability describes the extent to which entrepreneurs are
dynamic, flexible, self-regulating, and engaged in the process of
generating multiple decision frameworks focused on sensing and
processing changes in their environments and then acting on them.
 Entrepreneurs who are able to increase cognitive adaptability have an
improved ability to (1) adapt to new situations—i.e., it provides a basis by
which a person’s prior experience and knowledge affect learning or
problem solving in a new situation; (2) be creative—i.e., it can lead to
original and adaptive ideas, solutions, or insights; and (3) communicate
one’s reasoning behind a particular response
Learning from Business
Failure
 Business failure occurs when a fall in revenue and/or a rise in expense is
of such magnitude that the firm becomes insolvent and is unable to attract
new debt or equity funding; consequently, it cannot continue to operate
under the current ownership and management.
 Projects also fail, such as failure of a new product development effort, the
entry into a new market, or an alliance with a form competitor.
 Although there are many causes of failure, the most common is
insufficient experience
 For entrepreneurs, learning from failure occurs when they can use the
information available about why the venture failed, to revise their existing
knowledge of how to manage their ventures more effectively that is,
revise assumptions about the consequences of previous assessments,
decisions, actions, and inactions.
Gender issues in entrepreneurship :women
entrepreneurship
Characteristics of women
entrepreneurship
 Imagination
 Attribute to work hard
 Persistence
 Ability and desire to take risk
 Flexibility
 Analytical ability of mind
 Openness to feedback and learning from experience
 Confronting uncertainty
 Stress takers
 Business communication skill
 Leadership
 Determination
Scope of entrepreneurship among
women
Increase in ownership
Rise of women
Rise of multiple careers
Increasing social entrepreneurial nation
Bootstrapping at new level
Increase in work participation
 Challenges faced by women
entrepreneurs
 Lack of confidence
 Legal statutory and procedural formalities
 Decision making and problem solving
 Inadequate vocational and technical training
 Operational problems
 Updating of technological changes
 Socio-personal problems
 Occupational mobility problems
 Government assistance problems
 Financial problems
 Personal problems
Suggestions to solve problems of women
entrepreneurs
 Finance cells
 Marketing cooperation
 Supply of raw materials
 Training facilities
 Promotional help
 Gain occupational work experience
 Prioritizing responsibilities
 Establish a support system
https://www.instamojo.com/blog/women-in-business
-india-statistics/
https://www.womensweb.in/2019/07/women-
entrepreneurship-in-india-2019-our-new-study-
uncovers-what-women-need-to-flourish/