Entrepreneurship Development - Introduction

BBA156203
ENTREPRENEURSHIP
DEVELOPMENT
Unit 1 – Introduction
MR.T.SOMASUNDARAM
ASSISTANT PROFESSOR
DEPARTMENT OF
MANAGEMENT STUIDES
KRISTU JAYANTI COLLEGE
(AUTONOMOUS)
BENGALURU 1

UNIT 1: INTRODUCTION
Introduction to Entrepreneur;
Entrepreneurship and Enterprise;
Importance and relevance of the
Entrepreneur; Factors influencing
Entrepreneurship; Pros and Cons of
being an Entrepreneur; Women
Entrepreneur; Problems and promotion
(SHGs); Types of Entrepreneurs;
Characteristics of a successful
Entrepreneur; Competency requirement
for Entrepreneurs; Awareness of Self –
Competency.
Unit 1 – Introduction 2

WHO IS A ENTREPRENEUR............

 Entrepreneur of the world are wisest minds who leave an
indelible mark in the history of mankind.
 Entrepreneur make it possible through their action, and
not through words.
 Entrepreneur is an important input of economic
development.
 The word ‘Entrepreneur’ first appeared in French
language ‘Entreprendre’ which means to ‘undertake’
(i.e.) the person who undertakes the risk of new enterprise.
 Entrepreneur is an innovative person who maximizes his
profits by following new strategies or venturing into new
products or services.
INTRODUCTION

Definition:
“Entrepreneur is defined as, a person who is
responsible for setting up a business or an enterprise.”
“Entrepreneur is one who assumes the RISK and
MANAGEMENT of business.” - Noah
Webster
“Entrepreneur is a person who starts an enterprise,
business of firm or industrial undertaking with a view to
make profit.
“An entrepreneur is defined as “person in effective
control of commercial undertaking; one who undertakes
a business or an enterprise”.
5Unit 1 – Introduction

Examples:
 SHIV NADAR – HCL
ANILAMBANI & MUKESH AMBANI –
RELIANCE
AZIM PREMJI – WIPRO
NARAYANAMOORTHY– INFOSYS
K.V.KAMATH – ICICI

INDIAN ENTREPRENEURS
JRD Tata
Adi Godrej
Kiran Mazumdar Shaw
Nandan Nilkani
Narayanamoorthy
Rahul Bajaj
Ratan Tata
Shiv Nadar
Vijay Mallya

Reliance – Mukesh
Ambani
Tata Group – Ratan
Tata
Pepsi co – Indira
Nooye
Bicon Ltd – Kiran
Mazumdhar shaw

Bill Gates – Microsoft
Larry Ellison – Oracle
Steve Jobs – Apple
Computer
Samuel Palmisano -
IBM

 To an Economist – person who brings
resource, labour, materials and other assets.
 To an Psychologist – person driven by
certain forces, the need to attain something.
To an Business man - person who appears
as a threat, an aggressive competitor.
DEFINITION IN DIFFERENT
ASPECTS

 Earliest Period – person who involved in Trade /
Merchant.
Middle age Period – person who manage huge
production projects.
17th Century – Contractual agreement with
government to perform Service or Products.
18th Century – person whose capital differentiated
from one who need capital (i.e.) Capital provider
19th& 20th Century – Innovator & New idea.
ENTREPRENEUR CONCEPT IN
DIFFERENT CENTURY

1. Risk taking and uncertainty bearing.
2. Taking business decision at proper time.
3. Managerial functions (Production,
Marketing, Finance, HR & System)
4. Innovations in the business.
5. Continuous improvement in the business
started.
FUNCTIONS OFAN ENTREPRENEUR

 It relates to entrepreneur, his vision and its
implementation.
 It is a cycle of actions to further the interest of the
entrepreneur.
 It involves taking of risks and making the necessary
investments under conditions of uncertainty and
innovating, planning and taking decisions.
 It is the ability to discover an investment opportunity and
to organize an enterprise, thereby contributing to real
economic growth.
 It is the propensity of mind to take calculated risks with
confidence to achieve a pre – determined business.
ENTREPRENEURSHIP – THE CONCEPT

Definition:
“Entrepreneurship is the process of creating
something new with value by devoting the necessary time &
effort, assuming the accompanying financial, psychic and
social risks and receiving rewards of monetary and personal
satisfaction and independence”.
‘Entrepreneurship refers to a process of action
an entrepreneur (person) undertakes to establish his / her
enterprise. It is a creative and innovative response to the
environment.
ENTREPRENEURSHIP

* 1986 - Peter Drucker: Innovation and Entrepreneurship.
* 1952 - Mark Casson: The Entrepreneur: An Economy Theory
* 1973 - Israel Kizner: Competition and Entrepreneurship
* 1968 - Heavy Leibenstein: Entrepreneurship and Development
* 1961 - Frank Knight: Risk, Uncertainty and Profit
*1934 - Joseph Schumpeter: The Theory of Economic
Development
* 1803 Jean-Babtiste Say: A Treatise on Political Economy
*1755 Richard Cantillion: Essentials nature of Commerce in
general.
HISTORY OF ENTREPRENEURSHIP

Increases national production.
Balanced area development.
Dispersal of economic power.
Reinvestment of profit for the welfare of the area
of profit generation.
Development is a function of motivation and
human resource.
Entrepreneurial awareness.
NEED FOR ENTREPRENEURSHIP

The stimulation of entrepreneurship is a function of both
internal and external variables.
Some of the findings about entrepreneurs in Nepal are:
a) Mainly there are two types of entrepreneurs; Government
and private individuals.
b) In a family – run business the entrepreneur is owner as
well as manager and frequently found to have parents who
were engaged in business – related occupations.
c) Many people who migrated from other country have
become entrepreneurs.
d) In the family, a change is taking place.(i.e.) now educated
young members are becoming entrepreneurs.
STIMULATION OF ENTREPRENEURSHIP

“Entrepreneurial process refers to the duties involved
in implementing the entrepreneurial activities.”
Steps:
i) To implement an innovation activity, like entering to a new
market to increase market share & turnover, entrepreneur
first conceives the concept and fully identify it.
ii) In next stage, he analyses the strategy or his innovation
idea and assesses and calculates the risks to bear when
project is implemented.
iii) In final stage, he monitors the activities and make
corrections, if required.
ENTREPRENEURSHIP PROCESS
Unit 1 – Introduction
Implement the
innovative activity
Strategy
formulation &
adoption
Monitoring the activities by
adopting solutions for
problems
18

The Entrepreneurship process involves –
a) Identification of opportunities.
b) Converting business opportunity into reality.
c) Identifying locational problems and solving them.
d) Managing environmental problems.
Entrepreneurship Analysis:
Characteristics of Entrepreneurship
Entrepreneurship
Innovation Making Enterprise a success
Risk taking Skillful Management
Decision - making Organization
Accepting Challenges

Entrepreneur Entrepreneurship
Refers to a person Refers to a process
Creator Creation
Organizer Organization
Decision maker Decision making
Initiator Initiative
Leader Leadership
Motivator Motivation
Risk taker Risk taking
DIFFERENCE BETWEEN ENTREPRENEUR
AND ENTREPRENEURSHIP
Elements of
Entrepreneurship:
a) Idea.
b) Market.
c) Funding.
d) Legalities.
e) Advertising and
Marketing.
f) Business Plan.

ENTREPRENEURIAL LIFE CYCLE
1) Develop skills that may contribute to
entrepreneurial behaviour.
6) Plan & Prepare the venture 2) Examine opportunities
thoroughly to fulfill needs & wants
and to solve problems.
5) Use all available sources & 3) Generate ideas to satisfy
resources to evaluate opportunities the opportunities.
and ideas.
4) Assess the opportunity and ideas.
Unit 1 – IntroductionUnit 1 – Introduction 21

ENTREPRENEURIAL PROCESS
1) Identify &
Evaluate the
opportunity
 Opportunity
assessment.
 Creation &
length of
opportunity.
 Real &
Perceived value
of opportunity.
 Risk & Return
 Opportunity vs
Personal skills
& goals.
 Competitive
Environment.
2) Develop
Business Plan
 Title page.
 Table of content
 Executive
 summary.
 Major section.
- Business
description.
- Industry
description.
- Technology plan.
- Marketing Plan.
- Financial,
Production,
Organization.
- Summary.
3) Resource
required
 Resource
needed.
 Existing
resources.
 Identify
resource gaps
& available
suppliers.
 Access to
needed
resources.
4) Manage the
enterprise
 Develop
Management
style.
 Understand
key variables
for success.
 Identify the
problems.
 Implement
control
systems.
 Develop
growth
strategy.

BARRIERS TO ENTREPRENEURSHIP
1. Lack of a viable concept.
2. Lack of market familiarity.
3. Lack of Technical skills.
4. Lack of seed capital.
5. Lack of Business know how.
6. Complacency lack of motivation.
7. Social Stigma.
8. Time Pressures, Distraction.
9. Legal Constraints.
10.Protectionism monopoly. 11. Patent inhibitions. 23

 Enterprise is the starting point of an Entrepreneur and
decides through this entity as to where the business has to go
and how is it to be positioned.
 Enterprise simple means an economic organization or activity
and it is also called as ‘place of business of an Entrepreneur
or individual’.
 Enterprise may be considered as “an organization engaged in
a business activity.”
 Enterprise is an integrated whole of values, orientation, vision
of entrepreneur and his work force, mission, objectives and
strategies, etc.
 A well – run enterprise embraces and practices a sound
Predictability – Sustainability – Profitability – De-risking
(PSPD) model.
ENTERPRISE – THE CONCEPT
24

 Every Enterprise must focus on high profitability in order to
ensure best returns for its shareholders.
 Enterprise must have a good de-risking approach that
recognizes, measures and mitigates risk along every
dimension.
 Enterprise Governance is focused on maximizing shareholder
value while ensuring fairness to all stakeholders.
The six pillars of Enterprise Governance are:
a) Importance of being trustworthy.
b) Explore.
c) Supportive family which built career.
d) Learn how to manage yourself.
e) Live your life and lead your career in way that makes a
difference to your society. 25

 Entrepreneur is one of the most important inputs in
economic development of a country and makes all
difference in rate of economic growth.
 It is need to speed up the process of activating the factors
of production, leading to higher rate of economic growth,
dispersal of economic activities, development of
backward and tribal areas, creation of employment
opportunities and improvement in standard of living of
weaker sections of society.
 Several factors like socio-political, economic conditions,
availability of technology, existence of markets,
incentives and facilities are available for growth of
entrepreneurship.
IMPORTANCE & RELEVANCE OF
ENTREPRNEUR
26

 Entrepreneurs are to be innovators who must change the
production function and bring rapid development.
 Entrepreneurship is more important under capitalism and
mixed economy where not only responsibilities of
entrepreneur in production and distribution are recognized
and objective of growth of profit maximization is
attained.
 It is significantly important in a mixed economy as it
permits growth of both public and private sector.
Relevance of Entrepreneur:
 Government play two types of role – a) Promotional role
and b) Regulatory role.
 Government needs certain amount of skill and knowledge
to promote various economic activities. 27

 Entrepreneurial skills are allowed to play a role and
contribute for growth of economy.
 It is more relevant that skill of individual to promote
business activities of economy.
 Today controlled economic systems are also opening up
for market economy to utilize entrepreneurial skills of
human resources of such economies.
 Entrepreneurial skills of citizens of such economy has to
be utilized for economic growth and they should be
allowed to play independently.
 Government should play the promotional role to assist the
small business people to contribute for development of
economy.

Some of the important factors which prompted entrepreneurs
to enter industry as follows:
A) Factors Internal to the Entrepreneur:
i) Strong desire to do something independent in life.
ii) Technical Knowledge or / and manufacturing experience.
iii) Business experience in the same line.
B) Factors External to the Entrepreneur:
i) Financial assistance from institutional sources.
ii) Accommodation in industrial estates.
iii) Machinery on hire purchases.
iv) Attitude of the government to help new units.
FACTORS INFLUENCING ENTREPRNEURSHIP
29

v) Financial assistance from non – government sources.
vi) Encouragement from big business.
vii) Heavy demand. viii) Profit margin.
ix) Unsound units available at a cheap price.
The other factors behind entrepreneurial growth are:
I) Entrepreneurial Ambitions:
 To make money.
 To continue family business.
 To secure self – employment / independent living.
 To fulfill desire of self/parents.
 To gain social prestige.
 Others – decent living, something creative, provide
employment to others, etc. 30

II) Compelling reasons:
 Unemployment.
 Dissatisfaction with the job so far held or occupation
pursued.
 Make use of idle time.
 Make use of technical / professional skills.
 Other maintenance of large families, revival of sick unit
started by father, etc.
III) Facilitating factors:
 Success stories of entrepreneurs.
 Previous association (experience in same field).
 Property inherited.
 Advice or influence of family members. 31

CHARACTERISTICS (COMMON TRAITS) OFAN
ENTREPRENEUR
 Organiser
Capitalist
Innovative
Change Agent
Risk taker
Opportunist
Decision maker
Visionary
Leader
Dreamer
Problem Solver
High Achiever
Hard worker
 Time/Speed
Self-Reliance
Communicator
Motivator
Initiative
Discipline
Will power
Optimistic
Strategist
Creativity
Flexibility
Adaptability
Courage
 Sound Knowledge
Technical Knowledge
Passion
Assertiveness
Independent
Human Relations
Involvement
Pride
Values
Conviction
Dynamism
Commitment
Determination 32

1) Sound entrepreneurial education and training
2) Entrepreneurial skills, attitude and temperament.
3) Achievement motivation and success oriented endeavors.
4) Sound entrepreneurial mental health.
5) Entrepreneurial secrecy, liaisons, communications, dynasty and
leadership.
6) Innovative spirit and risk-bearing capacity.
7) Strong dream and will to build his own kingdom.
8) Impulses to fight for sake of success.
9) Desire to enjoy the fruits of entrepreneurial genius.
10) Living organs to sense the changing environment.
QUALITIES (KNOWLEDGE) OFAN
ENTREPRENEUR

11) Willingness to take up ‘Calculated Risks’
12) Self motivation & initiative.
13) Foresight, creativity & innovativeness.
14) A liking for business.
15) A tendency to challenge risks.
16) Result orientation – fix the target.
17) Perseverance & total commitment.
18) Willingness to learn.
19) Emotional stability & Behavioural flexibility.
20) Adaptability to changes.
21) Self confidence & Will power.
22) Sociability & Communicational ability.
23) Time Consciousness.
24) Sense of personal responsibility to achieve.
25)Aspiration for more.

Role:
- to increase per capita output & income.
- generation of employee opportunity and
balancing economic development.
- to bring changes in business & society.
- investment & innovation in economic
development.
* Importance – Product evolution process, Iterative
synthesis, Ordinary innovations, Technological
innovations & Breakthrough innovations.
ROLES & RESPONSIBILITY

Responsibility:
- take risk & invest own money.
- should meet stressful situations, meetings,
etc.
- balance ethics & social responsibility.
- obey laws & professional ethics.
- Business ethics – i) theory & empirical
studies
ii) theory building without empirical study.
iii) empirical research iv) research with
managers and business environment.

I) Technical skills:
* Writing, Oral Communications.
* Monitoring environment.
* Technical Business environment.
* Technology, Interpersonal, Listening.
* Ability to organize, Network building.
* Management style, Coaching, team
player.
KNOWLEDGE & SKILLS REQUIRED FOR
AN ENTREPRENEUR

II) Business Management Skills:
* Planning and Goal setting.
* Decision making, Human Relations, Marketing.
* Finance, Accounting, Management, Control.
* Negotiation, Venture launch, Managing growth.
III) Personal Entrepreneurial Skills:
* Inner control / disciplined.
* Risk taker, Innovative, Change oriented.
* Persistent, Visionary leader.
* Ability to manage change.

Pros (Advantages):
1. Bridge the gap between knowledge and applications:
• People acquire knowledge through education.
• All are not interest in applying their knowledge for benefit
of society.
• Entrepreneur can bridge the gap between knowledge and its
applications and convert into economic activity.
2. Converting an idea into money:
• He may push up ones innovative ideas into reality.
• He is creative, skillful and calculate risk to put resources
into use.
PROS AND CONS OF ENTREPRENEUR

3. Be your own boss: (Ownership pleasure)
• They possess high capacity to take risk, provides an
opportunity to society to improve the standard of living.
4. Originality, respected: (Build up social status)
• Creative and original business ideas of an entrepreneur
can be used for societal benefits and respected in the
society.
5. Competition:
• Adapting innovative ideas of entrepreneur in product /
service at low cost will facilitate organization to face
competition in the market.
6. Better utilization of skill and knowledge:
• Creative skill and knowledge of entrepreneur can be used
for benefit of the society.

7. Alternative to current career:
• People with entrepreneurial skills will be working of others
(Intrepreneurs).
• Entrepreneurial skills will be used for benefit of society and it is
alternative to their present career.
8. Business Opportunity: (Opportunity to be creative)
• Opportunity will be cropping up in different sizes & magnitudes.
• It have personal gain and facilitate society to tap resources for
improving standard of living of people.
9. Independence and Freedom.
10. Direct involvement in decision making.
11. Master of your destiny.
12. Unlimited income.
13. No standard working hours.
14. A sense of self actualization.

Cons (Disadvantages):
1. Remuneration: (Uncertainty in income)
• Entrepreneur work on principal of opportunity cost and
decides to get into business.
• Expected growth in terms of profit and assets may not happen.
(no assurance).
2. Benefits:
• Entrepreneur enjoying normal profits and build reasonable
assets.
• He can’t enjoy monopoly power and make supernormal
profits.
• Due to threat of competition, extra profit can be eaten by
competitors.
3. Total responsibility. 42

4. Time management: (Work pressure round the clock)
• Work schedule of entrepreneur is never predictable.
• Emergency can come up in business and late hours will have
to be put in business.
5. Management:
• Entrepreneur will be boss of one’s own business and decision
making.
• He should have better management of his affairs to take
decision.
• Unknown risk will make entrepreneur trouble in managing the
business.
6. More risk.

7. Experience:
• Few people acquire entrepreneurial skills when they
enter into their own business.
• Working with employees who don’t have basic
knowledge becomes a tough time for entrepreneur.
• Care competence is accepted and practiced business
is success factor of an entrepreneur.
8. Vulnerability to changes.
9. Sacrificing personal / family life.

Innovative Entrepreneur – new idea or
innovative thought.
Adoptive or Imitative Entrepreneur –
copying same method for their business.
Fabian Entrepreneur – doing traditional
business. (E.g.) Jain religion.
Drone Entrepreneur – no changes in
business.
TYPES OR CLASSIFICATION OF
ENTREPRENEUR

 Intrapreneurs – person working in a
company and quit out to start his own business
having experience in that area.
Co-preneurs – married couple working
together or partnership between family
members. (E.g.) Mr.Narayanamoorthy and
Mrs.Sudha Narayanamoorthy – Infosys.

I )According to type of Business:
1. Business Entrepreneur – who conceive an idea for a new
product or service & then create a business to convert their
idea into reality. (E.g.) small business units like textile,
printing press, agency, etc.
2. Trading Entrepreneur – who undertakes trading activities
and is not concerned with the manufacturing work. (both
domestic & overseas trade).
3. Industrial Entrepreneur – a manufacturer who identifies
the potential needs of customers and meet the marketing
needs. He has ability to convert economic resources and
technology into considerable profitable venture.
OTHER TYPES (OR) CLASSIFICATION

4. Corporate Entrepreneur – who demonstrates his innovative
skill in organizing and managing a corporate undertaking. He
plans, develop and manages a corporate body.
5. Agricultural Entrepreneur – who undertakes agricultural
activities as raising and marketing of crops, fertilizers and
other inputs of agriculture.
6. Retail Entrepreneur – who involved in doing retail
business.
7. Service Entrepreneur – those who have an idea of
providing service to the people in order to meets the needs in
the society.
8. Social Entrepreneur – individuals with innovative solutions
to society’s most pressing and daunting social problems. They
are highly creative thinkers to solve social problems.

II) According to Technology:
1. Technical Entrepreneur – he is an entrepreneur of
craftsman type. He develops new and improved quality of
goods because of his craftsmanship.
2. Non-Technical Entrepreneur – they are not concerned
with the technical aspects of product in which they deal.
3. Professional Entrepreneur – who is interested in
establishing a business but does not have interest in
managing or operating it once it is established.
4. High-tech Entrepreneur – who applies technical aspects
in his overall activities of business.
5. Low-tech Entrepreneur – a person who adapts limited
level of technical aspects in the business.

III) According to Motivation:
1. Pure Entrepreneur – an individual who is motivated by
psychological and economic rewards. He takes for personal
satisfaction in work, status, etc.
2. Induced Entrepreneur – who is induced to take up an task
due to policy measures of government that provide
assistance, incentives, concessions and necessary overhead
facilities to start venture.
3. Motivated Entrepreneur – motivated by desire for self –
fulfillment and come into existence because of possibility of
making and marketing product.
4. Spontaneous Entrepreneur – they start their business out
of their natural talents. Persons with initiative, boldness and
confidence in their ability to take entrepreneurial activity.

IV) According to Growth:
1. Growth Entrepreneur – those who necessarily take up a
high growth industry. He choose industry which has
sustained growth.
2. Super-growth Entrepreneur – those who have shown
enormous growth of performance in their venture.
V) According to Stages of Development:
1. First generation Entrepreneur – one who starts as
industry by means of innovative skills. (innovator).
2. Modern Entrepreneur – one who undertakes those venture
which go well along with changing demand in market.
3. Classical Entrepreneur – one who concerned with the
customers and marketing needs through development of self
– supporting venture.

VI) According to Capital Ownership:
1. Private Entrepreneur – individual or group of individual
set up an enterprise and bear risk and adopt technology in
business.
2. State Entrepreneur – it means trading or industrial
venture undertaken by state or government itself.
VII) According to Gender & Age:
1. Male Entrepreneur.
2. Women Entrepreneur.
3. Young Entrepreneur.
4. Old Entrepreneur.
5. Middle – aged Entrepreneur.

IX) According to Area:
1. Urban Entrepreneur.
2. Rural Entrepreneur.
X) According to Scale:
1. Large scale industry Entrepreneur.
2. Medium scale industry Entrepreneur.
3. Small scale industry Entrepreneur.
4. Tiny industry Entrepreneur.
Others:
1. Spiritual Entrepreneur.
2. The Edupreneurs. 3. Event Entrepreneur.

Dimension Entrepreneur Intrapreneur
Dependency
Independent in
Operation
Dependent on
decision of
Entrepreneur
(Owner)
Raising of Funds
Himself raises
funds
Not raised by
intrapreneur
Risk involve risk Does not take risk
Operations
Operates from
outside
Operates within
organisation
DIFFERENCE BETWEEN
ENTREPRENEUR AND INTRAPRENEUR

Dimensions Entrepreneur Manager
Motive Start a venture Render his service in
enterprise
Status Owner of enterprise Employee in an
enterprise
Risk bearing Assumes risk and
uncertainty
Employee dose not
bear risk
Rewards Profit Salary
Innovation Innovator or meet
changes
Executes the prepared
plan
Qualification High achievement
motive
Distinct qualification
DIFFERENCE BETWEEN
ENTREPRENEUR AND MANAGER

Definition:
“It is defined as a women or group of women who
initiate, organize and run a business enterprise.”
“It is the participation of women in equity and
employment of a business enterprise.”
“It is defined as an enterprise owned and controlled by
a women having a minimum
financial interest of 51% of
the capital and giving at
least 51% of the employment
generated in the enterprise to
the women.”
WOMEN ENTREPRENEUR

Some of the famous Women Entrepreneurs are -
1.Akhila Srinivasan, Managing Director, Shriram Investments
Ltd
2.Chanda Kocchar, Executive Director, ICICI Bank
3.Ekta Kapoor Creative Director, Balaji Telefilms
4.Jyoit Naik, President, Lijjat Papad
5.Kiran Mazumdar-Shaw, Chairman and Managing Director,
Biocon
6.Lalita D Gupte, Joint Managing Director, ICICI Bank
7.Naina Lal Kidwai Deputy CEO, HSBC
8.Preetha Reddy, Managing Director, Apollo Hospitals
9.Priya Paul, Chairman, Apeejay Park Hotels
10.Rajshree Pathy, Chairman, Rajshree Sugars and Chemicals
Ltd.

Features of Women Entrepreneurs:
 Imaginative & Attribute to work hard.
 Ability and desire to take risk.
 Profit earning capacity.
 Most women with small income are likely to become
entrepreneurs.
Functions of Women Entrepreneurs:
 Exploration of prospects of starting a new business enterprise.
 Undertaking of risks and the handling of economic uncertainties
involved in business.
 Introduction of innovations or imitation of innovations.
 Coordination, administration and control.
 Supervision and leadership.

Profile of a Women Entrepreneur and her business:
 First – born child of middle class parents.
 Father / Mother in independent business.
 College – educated.
 Early 30s for the first significant venture.
 Previous experience in new ventures.
 Desires independence.
 Motivated by desire for independence and job
satisfaction.
 Small and young business.
 Moderate risk – taker.
 Personnel management.
 Married.
 Self – confident.
 High tolerance for
ambiguity.
 High energy level
59

Biggest problems in start – up:
 Lack of business training.
 Obtaining credit.
 Availability of information.
 Obtaining seed capital.
 Marketing.
Biggest problems in current operations:
 Lack of experience in financial planning.
 Weak collateral position.
 Cash flow management.
 Taxation.

Who do Women take – up Entrepreneur?
 Push factors:
- death of bread winner.
- sudden fall in family income.
- permanent inadequacy in income of
the family.
 Pull factors:
- women’s desire to evaluate their talent.
- to utilize their free time or education.
- need and perfection of women’s liberation,
equity, etc.
- to gain recognition, importance and social
status & to get economic independence. 61

Categories of Women Entrepreneurs in practice in India:
- Established in big cities.
- Having higher level technical &
Professional qualifications.
- Non traditional items.
- Sound financial positions.
First
Category
Second
Category
- Established in cities & towns.
- Having sufficient education.
- Both traditional & Non
traditional items.
- Undertaking women services-kinder
garden, crèches, beauty parlors,
health clinic, etc..

- Illiterate women.
- Financially week.
- Involved in family business
such as agriculture, horticulture,
animal husbandry, dairy,
fisheries, agro forestry,
handloom, power loom, etc.
Third
Category

Leadership Qualities:
Some of the outstanding qualities of women entrepreneur are
as follows:
 Accept challenges.
 Ambitious.
 Drive.
 Enthusiastic.
 Hard work.
 Patience.
 Industrious.
 Motivator.
 Skillful.
 Optimistic.
 Adventurous.
 Conscious.
 Educated.
 Determination to excel.
 Experienced.
 Keenness to learn & imbibe new
ideas.
 Intelligent.
 Perseverance.
 Studious.
64

Psycho – Social Barriers:
 Poor self – image of women.
 Discriminating treatment.
 Role conflict.
 Lack of courage and self – confidence.
 Inadequate encouragement.
 Lack of social acceptance.
 Unjust social – economic and cultural system.
 Lack of freedom of expression.
 Afraid of failures and criticism.
 Susceptible to negative attitudes.
 Inadequate motivation.
 Faulty socialization.
 Cultural values.
 Inadequate
encouragement.
 Non – persistent
attitude..
 Low dignity of labour.
65

Problems of Women Entrepreneur:
Some the basic problems faced by women entrepreneurs are -
 Start up finance. (problem of finance).
 Lack of marketing and sales skills.
 Scarcity of raw materials.
 Working capital management.
 Administration and regulatory requirements.
 Access to markets / technology.
 Awareness of business support.
 Discrimination by lenders. (finance & support providers).
 Adaption of quality standards.
 Management skills.
 Stiff competition.
 Limited mobility.
 Family ties.
 Lack of education.

 Male – dominated society.
 Intellectual property protection.
 Lack of confidence.
Promotion of Women Entrepreneurs:
• 48% of the total population of country are women and
34% are employed in some form or other.
• “Gender And Development” (GAD) in 1980s clearly
identified the role of women as entrepreneurs.
• Women should brought to central stage from marginality
in entrepreneurial development.
• It is not only to initiate a process of economic growth but
also a process to improve lives of people.
 Language.
 Low risk bearing ability.

• Women have started becoming entrepreneurs during last 20
years.
• Her activities are influenced by occupational background of
families, education of their husbands and she plays dual role
as house wife and income earner.
Some of the measures to adapted to promote the women in semi-
urban and rural areas especially service sector are:
i) Establishing only small units.
ii) Deciding the correct time of establishment.
iii) Providing adequate financial assistance.
iv) Solving problem of gender inequality.
v) Coordinating the dual role of family and business.
vi) Imparting necessary training.
vii) Training to have patience and tolerance. 68

Training necessary in –
1. Core competence:
 Nowadays women trained in IT, bio-technology, management,
services, engineering areas, etc.
 This core competence should be their for women to become
successful entrepreneur.
 Family & society should motivate their core competence to start
their business units.
2. Facilities for IT enable services:
 Women are having lot of opportunities to start their business
units in IT sector.
 Financial requirements need for start up in IT sector and
profound marketable skills.
 Facilitating for training in web design, DBMS, multimedia
services, etc. should be extended for start up their business. 69

Some of the measures are listed to motivate women to
become entrepreneurs in large numbers are –
i) To collect information on specific actions and support
measures prompting female entrepreneurship.
ii) To identify good practices in the promotion of female
entrepreneurship.
iii) To develop a methodology for assessing member’s
actions and support measures for promoting female
entrepreneurship overtime.
iv) Promoting measures should cover, start-up facilities,
information and advice funding, training facilities,
mentoring and networking.

Associations promoting Women Entrepreneurs:
Gender And Development (GAD) approach has clearly
identified the entrepreneurial activities for women. Based on
that, association and agencies that functioning at state and
national level to promote women entrepreneurs are –
1. Self – Help Groups (SHGs):
• This is an association of small group of self – employed
rural or urban women entrepreneurs who join together to
take care of group welfare.
• Member contributes little amount to cover seed money
and rest will be provided by financial institutions or
NGOs.
• In Karnataka, “Stree Shakti” scheme of Government of
Karnataka providing funds for women entrepreneurs. 71

• SHG is a small, economically homogenous group which
is voluntary in nature to share facilities equally between
members.
• Members in SHG have to be active, attend all meetings
and discuss about programs and problems.
• It provide facilities to its members in form of loan or raw
materials or skilled labour, etc.
• These associations are helping small women entrepreneurs
to start and develop home – based business.
• SHG is started with objective of extending credit facilities
to small entrepreneurs.
• It has became a strong vehicle to encourage and build
confidence among rural women who have strong urge to
start business or service to improve economic position. 72

Functioning of SHGs:
1. Identification of needs:
- Voluntary organization formed small groups to satisfy their
common needs and not individually.
- Understanding and cohesion between members.
2. Cost – benefits:
- Cost of fund will be reasonable or affordable.
- Economic benefits are reaped in form of cash savings,
optimum production, increased income and savings.
- It makes members to be more comfortable and develops
organizational identity and confidence.
- SHGs provide greater benefit at a very negligible cost.

3. Characteristics:
- It develops good behavioural aspects like leadership,
capability, knowledge and skill.
- It voluntarily motivates members to work honestly for
common cause.
Framework of SHGs:
 It is a small group not normally exceeding 20 members.
 Supported by Government or NGOs or micro – finance
organizations or other local agency.
 Group collects small contribution from members and
hand it over to group leader for operations.
 Bank account may act as a supporting facility to avail
required finance from such banks.Unit 1 – Introduction 74

 Members can avail individual loans to satisfy their
enterprise needs with group account.
 Members have to provide sufficient information about
their family background and permanent address.
 As members coming from different cultures and
background, an implied authority is enforced.
 They should be mutually accountable and understand the
co-operative nature of savings and loan disbursement.
 Members might be having political affiliations with
different political parties. But it should not exhibited in
discharging the group tasks of SHGs.

Steps taken by Government to promote Women
Entrepreneurs:
1. Mahila Vikas Nidhi:
- Under this scheme, cumulative help of Rs.80.4 million was
sanctioned, during 1990 – 2001.
- Various training – cum production centers set up by NGOs
mostly relate to activities like sericulture, spinning, weaving,
block printing, handloom products, handicrafts, etc.
2. District Industries Center (DICs):
- DICs arrange various lectures
and seminars, etc. in women’s college
and technical institutes to encourage
them to set up their own enterprises. 76

3. Rashtriya Mahila Kosh:
- It was set up in 1993 to provide micro-credit to poor women
who had no access to financial institution at reasonable rates
of interest with very low transaction costs and simple
procedures.
- It proved quite useful for lower income group
women.
4. Training programs:
- Government started various training program exclusively
for self – employment of women.
- It includes Support for Training and
Employment Programs (STEP) for women and Development
of Women and Children in Rural Areas (DWCRA).

WOMEN ENTREPRENEURSHIP IN
INDIA
States No. of Units
registered
No. of Women
Entrepreneurs
Percentage
Gujarat 3872 1538 39.72%
Karnataka 3822 1026 26.84%
Kerala 5487 2135 38.91%
Madhya Pradesh 2967 842 28.38%
Maharashtra 4339 1394 32.12%
Punjab 4791 1618 33.77%
Tamil Nadu 9618 2930 30.36%
Uttar Pradesh 7980 3180 39.84%
Other states & UTS 14576 4185 28.71% 78

PERSONALITY CHARACTERISTICS OF SUCCESSFUL
ENTREPRENEUR
 Ability to create high morale among employees.
 Development of Interpersonal skills.
 Leadership quality.
 Obtain good business result.
 Intelligence and Creative.
 Able to guard business secrets.
 Emotional stability.
 Communication ability.
 Self-confidence.
 Long term involvement in business.

 Reasonable level of technical knowledge.
 Complete task or solve problem.
Goal setting ability.
 Deep knowledge of social , Political &
Economic.
Ability to infuse dynamism in organization.
 Reacting to changing environment.
 Strong Cultural base, healthy family
background.

COMPETENCY REQUIREMENTS FOR
ENTREPRENEUR
 Competency requirement is one factor which makes an
entrepreneur successful.
 He should possess certain core competencies to become a
recognized person in the society.
 Entrepreneurial activity is a form – giving activity which
gives a form to wishes of society, to ideas, raw material
processed through.
Some of the competencies required for an entrepreneur are
listed here –
1. Superintendence – capacity to assemble the means of
production turn out maximum at minimum cost and to
supervise the work. Unit 1 – Introduction 82

2. Control – should control the flow of goods, monitor the
applications of funds in business, optimum utilization of
men and machinery at work place.
3. Direction – goal oriented person, keep organization
constantly on path of his objective, capable of providing at
present what future demands and capable of directing the
business.
4. Organizer – should be competent to bear the risk in
business, courage to sustain the uncertainties and ability to
build organization.
5. Innovation – capable of introducing new product or
service, new production methods, creating new market, new
sources of supply and adopt in business, creating new
opportunities for success of business.

6. Other requirements – other essential requirements are:
- Managing time for attaining precision in operation.
- Effective decision making.
- co-ordination of various business functions.
- Seizing business opportunities.
- Fund management competency and marshalling resources.
- Willingness to accept change and ability to initiate change.
- Role performer as per expectations of society.
- Optimistic outlook for change management.
- Possessing qualities of leadership in solving persistent
professional problems.

AWARENESS OF SELF – COMPETENCYAND
DEVELOPMENT
 Entrepreneur has to establish business unit, search for new
opportunity in environment and initiates “improvement
projects” to bring change for continuous success of firm.
 He should be aware of his strengths and weakness in
order to bring change in strategies in all functional are of
business to have effective operation.
 Every entrepreneur should be aware of self –
competencies, which is also called ‘core – competence’
and it explains the inherent strength of entrepreneurs.
 “Understand yourself” is one mantra to analyze ones own
abilities and disabilities to develop their ability.

 Entrepreneurs self – driven activities brings them
success.
 Every business environment will normally be uncertain
and risk associated with starting new venture, so strong
desire should have to become entrepreneur.
 Researchers reveal that large majority have inborn
quality of becoming entrepreneurs and people
associated with particular will be knowing about that
business segments.
 Entrepreneurs recognizes, evaluates and purses an
opportunity in diverse contexts.
 Entrepreneurs settings are surrounded by uncertainty,
lack of structure, resources scarcity, etc.

 Self – competencies are personal traits which motivate
and encourage them to become entrepreneurs. They are:
 Inquisitiveness.
 Opportunity recognition.
 Action orientation.
 Strong desire.
 Capacity to tolerate.
 Independent thinking.
 Self starting ability.
 Internal locus of control.
 Individualism.
 Risk propensity.
 Creativity & Innovation.
 Networking.
 Team building talent.
 Hero - making.
 Belief in personal efficacy.
 Dynamism.
 Empirical mind set.
 Pragmatic.
 Nich craft. (focusing on
nich areas to succeed.
87

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