1. entrepreneur & entreprenurship
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Meaning of entrepreneurAn entrepreneur is a person who has already started or is in the process of starting an enterprise.
Definition Joseph Schumpeter Entrepreneur is an innovator who brings economic development through new combinations of factors of production.
DefinitionsWebsters dictionary one who organizes, manages and assumes the risk of a business or Enterprise.
A. H.Cole Entrepreneurship is a purposeful activity of an individual or a group of associated individuals, undertaken to initiate, maintain or organize profit oriented business unit for the production and distribution of economic goods and service.
Introduction to EntrepreneurshipWhat is Entrepreneurship?Entrepreneurship is the process of creating something new of value by devoting (giving) the necessary time and effort. By accepting and acknowledging the necessary financial, psychological, and social risks, andFinally receiving the resulting rewards be it monetary and personal satisfaction and freedom to do what you want. Robert D.Hisrich, M. Peters & D.A Shepherd
ENTREPRENEURSHIPIs the process by which individuals pursue opportunities without regard to resources they currently control.The essence of entrepreneurial behavior is identifying and putting useful ideas into practice.The task typically requires creativity, drive and willingness to take risks that can be accomplished by either an individual or a group
EntrepreneurshipProcess of creating something new & assuming the risks & rewards
Creation Process (for entrepreneur & audiences)Devotion of time & effortAssuming Risks (Financial, Psychological & Social) Rewards (Independence, satisfaction & monetary rewards)
Historical Evolution Of Entrepreneurship Earliest Period Middle Ages 17th Century 18th Century 19th & 20th Century THE ABILITY TO INNOVATE CAN BE OBSeRVED THROUGHOUT THE HISTORY Nature & Development Of Entrepreneurship
Earliest Periodthe earliest definition of entrepreneur may be related to the person (merchant adventurer) who attempted to establish trade routes to the far east they would sign a contract with money person to sell his goods. the capitalist was a passive risk bearer.merchant adventurer took the active role in trading bearing all the physical and emotional risks while the capitalist was a passive risk bearer.when he completes the trip, the profits divided (capitalist 75% , adventurer remaining 25%)
MIDDLE AGESthe term was used to describe both an actor and a person who managed large production projects
did not take any risks but merely managed using the resources provided usually by the government of the country
a typical entrepreneur in the middle ages was cleric the person in charge of great architectural works, such as castles and fortifications, public buildings, abbeys and cathedrals
18th Century:1725: RICHARD CANTILLION ( person bearing risks is different from one supplying capital)19th Century:1803: JEAN BAPTISTE SAY (separated profits of entrepreneur from profits of capital)1876: FRANCIS WALKER (distinguished between those who supplied funds and received interest and those who received profit from managerial capabilities)
20th Century:1934: JOSEPH SCHUMPETER (entrepreneur is an innovator and develops untried technology)1961: DAVID McClelland (entrepreneur is an energetic, moderate risk taker)1964: PETER DRUCKER (maximizes opportunities)
1975: ALBERT SHAPERO (takes initiative, organizes some social and economic mechanisms, and accepts risks of failure)1980: KARL VESPER (entrepreneur seen differently by economists, psychologists, business persons and politicians) 1983: GIFFORD PINCHOT (intrapreneur is an entrepreneur within an already established organization)
Characteristics or Personal Competency of an Entrepreneur.Initiative Sees and Acts on OpportunitiesPersistenceInformation seekingConcern for High Quality Work and Output Increased Productivity.Commitment to Work ContractEfficiency OrientationSystematic and organized planningProblem SolvingSelf ConfidenceAssertiveness Negotiation with suppliers & customersPersuasive & Influential Peers and stakeholdersInspirational - employeesEffective Communicator external & internal of organization
Main features of entrepreneurship
Common Characteristics of Entrepreneurs Commitment, determination, and perseverance Drive to achieve Opportunity orientation Initiative and responsibility Persistent problem solving Seeking feedback Internal locus of control Tolerance for ambiguity
Calculated risk taking Tolerance for failure High energy level Creativity and Innovativeness Vision Self-confidence and optimism Independence Team building
Entrepreneurial Characteristics Indian PerspectiveVision : Dream and visualizing the ways and means to achieve, visualizing market demands, socio-economic and technological environmentWithout the vision of making a big mark on the mobile industry Dhirubhai and now Anil Ambani could not have made what Reliance Communication (An Anil Dhirubhai Ambani Group) is today. Knowledge : Conceptual knowledge and technicalities of technological, operational, financial & market dynamics.Without sound knowledge of computers Naryanmurthy could not have made Infosys.
3.Desire to Succeed Constantly work to achieve higher goals.Without a desire to succeed constantly Mukesh Ambani would not have planned to ventured into Retail, Real Estates and Biotech.IndependenceNeeds independence in work and decision making without following rules of thumb and make their own rules and destiny.Without a desire for independence, Sabeer Bhatia would not have quit his job to start enterprise own his own and created Hotmail.com and Arzoo.com
5.OptimismHighly optimistic about achieving their vision.Without optimism Narayanmurthy (who took loan from his wife as not having enough finances) would not have left a lucrative job and created Infosys.Value AdditionNot rule of thumb , but a constant desire to introduce something new to existing business.Create, innovate or even add value to the existing products.Without value addition of life time free incoming calls Tata Indicom would not have been able to create space in already saturated mobile markets.
7.Leadership Exhibits qualities of a leader -Good Planners, Organizers, Good Communication Skills, Empathetic toward their employees, good decision-makers, initiative to implement plans, result oriented Hard workingAt time also called as workaholics.Continuous efforts to achieve success and know that there is no substitute for hard workDesire to control over their own fate Do not move in herds like sheep but pave own paths.Do not believe in luck or destiny but create their own destiny.
Attributes and Skills These so called entrepreneurial characteristics can be looked at to determine a set of skills useful for entrepreneur to possess.Group Skills work and learn together, task force, project teamsTechnical Skills technological, writing, mgt, organizing.Business mgt skills, DM and analytical skillsPersonal Entrepreneurial Skills- risk, innovative, visionary, persistent, manage change.
20Types of EntrepreneursNovice EntrepreneurHas no prior business ownership experiences as a business founder, inheritor, or purchaserHabitual EntrepreneurHas prior business ownership experienceNascent EntrepreneurIn the process of starting a new businessCan be either a novice or a habitual entrepreneur
21Types of Entrepreneurs (contd)Serial EntrepreneurHas sold or closed an original business and establishes another new business Continues the cycle of selling/closing and establishingPortfolio EntrepreneurRetains an original business and builds a portfolio of additional businessesThrough inheriting, establishing, and purchasing the businesses
IMPORTANCE OF ENTREPRENEURIN ECONOMIC DEVELPOMENT
23Current Importance of EntrepreneurshipThree areas of importanceInnovationProcess of creating, changing, experimenting, transforming, and revolutionizingNumber of New Start-upsImportant because new firms contribute to economic development through benefits such as product-process innovation Job CreationVital to the overall long-term economic health of communities, regions, and nations
Entrepreneurship is the dynamic need of a developing nation and sustains the process of economic development in the following ways:
Employment generation National incomeDispersal of Economic powerBalanced Regional development Harnessing Locally available resources and EntrepreneurshipReducing unrest and social tension amongst youthInnovations in enterprises Improvement in living standards Economic independence
Entrepreneurial EnvironmentEntrepreneurial Environment is a combination of factors that play a role in the development of entrepreneurship. First, it refers to the overall economic, socio-cultural, and political factors that influence peoples willingness and ability to undertake entrepreneurial activities. Second, it refers to the availability of assistance and support services that facilitate the start-up process.
Steps in the Entrepreneurial ProcessDiscoveryConcept DevelopmentResourcingActualizationHarvesting
Steps in the Entrepreneurial Process1. Discovery: The stage in which the entrepreneur generates ideas, recognizes opportunities, and studies the market
Steps in the Entrepreneurial Process2. Concept Development: Develop a business plan: a detailed proposal describing the business idea
Executive summaryObjectiveMission Statement
Steps in the Entrepreneurial Process3. Resourcing: The stage in which the entrepreneur identifies and acquires the financial, human, and capital resources need