Entrepreneur Asg 2

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Entrepreneurship (193) Assignment # 02

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Q1 a

Although its a business management concept, Entrepreneurship can be best understood in

terms of languages used in history. Believe me, you would find it more interesting to read aboutentrepreneurship and the whole story behind it. It is a point where motivation, innovation and

money intersect.

To become an entrepreneur one has to assume the risk of a business or enterprise and organize

and manage it so that it gives the return on the capital employed. An entrepreneur does not

have to arrange capital as this could be beyond your expertise. However, successfu

entrepreneurs of the past have been able to convince the financiers or venture capitalists that

their idea and business practices are sound and that they in partnership, proper returns on the

money invested can be gained.

One of the first entrepreneurs was Marco Polo. He had ideas of trading with Asia in the13th century and was sure of how he could get there and the materials he could trade. His

expeditions were financed by venture capitalists in Venice with an assurance that he would

share his profits with them. These loose associations continued to flourish in Europe and other

parts of the world where people with money were willing to back ideas and new schemes when

they were convinced that there was some pecuniary advantage in the end.

Entrepreneurship first took off when production levels exceeded local consumption and people

were left with surpluses of the things they produced, whether in the form of agricultural

produce, dairy products, livestock and quite a few manufactured items.This initially led to a barter system that allowed people exchanged things to satisfy their own

requirements. This further led to the development of the market place where people gathered

to barter or sell their excess production in order to profit themselves. This came about with

the realization that they could not wait indefinitely for a coincidence of wants before they

could barter their own products.

Government agencies stepped into the act in the 17th century and made capital available to

people to finance production ventures. The risk involved in such ventures was the sole

responsibility of the entrepreneur and they had to make a fixed payment to the government

irrespective of any profit they made from the venture. Governments considered this as asource of revenue.

The economist, Cantillon, opined that in the 17th century an entrepreneur was a risk taker. In

the 18thcentury, an entrepreneur was one who ran huge production projects without any

financial risk and with finance provided by others, notably the government. A clear distinction

was made between the entrepreneur and the capital provider. This change in thinking was

necessitated by the industrialization that made its effect felt in that century. Even Thomas

Edison ran into a huge financial crunch when he wanted to finance his ideas and inventions and


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Small Business owner to a Successful Entrepreneurship

Where does an Entrepreneur come from ? Can we say it is a small business owner who could takehis business to the next level? Entrepreneurs are not necessarily big, it ranges in scale from

solo projects to major undertakings creating huge job opportunity. A small business owner is

often satisfied in his small craftsmanship. However, an entrepreneur exploits his talent and hasconstant urge to evolve his business, keeping aside the monetary interest remains constant

while the business grows. A small business owner needs to be inspired and have the constant

drive to grow himself into an entrepreneur. Running a one-person business is a creative, flexibleand challenging way to become your own boss and chart your own future. It is about creating a

life, as it is about making a living. It takes courage, determination and foresight to decide

to become an entrepreneur. From the relatively safe cocoon of the corporate world, where paychecks arrive regularly, an entrepreneur ventures into the unchartered territories of business

Here are a few points which shows the connection between small business andentrepreneurship

The Meaning

Lets first know what these two terms mean. Small business is a business with comprises of few

number of employees. For a company to be termed as a small business depends in different

countries. For example, in United States a company is generally under 100 employees and inAustralia it should be under 20 employees. These businesses are generally privately owned sole-

proprietorships, corporations or partnership. On the other hand, entrepreneurshipmeans

starting new organizations or revitalizing mature organizations, particularly new businessesgenerally in response to identify opportunities. It's a difficult undertaking, because most of

these businesses fail at a very early stage. In the beginning of the business the term "Small

Business Owner" and "Entrepreneur" are interchangeable

Advantages

Every business has its own advantages and disadvantages. As for talking about small business, itrequires less initial capital to start the business. Its sources of funding can be self financing,

loans from friends and relatives, private stock issue, forming partnerships and SME financewhich includes collateral based funding or venture capital . The owner can keep a close check onthe accounts and books. Also, a small business owner can build intimate relations with his clients

which results in better creditability and responsiveness. For a Entrepreneur, has the inclination

to grow his business to the highest level, which in turns leads to high quality products andbetter job opportunity. As a bigger organization, it encourages use of modern technology with

research activity for quality improvement. Innovative and strategic ideas are developed to

enhance product quality. Contributes to theeconomy by giving better quality products forexport. Healthy competition lets the entrepreneur work towards better quality services


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constantly.

Disadvantages

The typical entrepreneurship is a small business. The success of any business is measured by itsfinancial growth. This also applies to large businesses who wish to start up a new business within

the current corporate framework. Small business often faces problems related to their size

like these businesses fail because of undercapitalization. The owner, before starting thebusiness, needs to make sure he has access to enough capital to support his project for at least

one year, anticipating his expenses. Another problem that is often realized in small business is

the "Entrepreneurial Myth", which means any person who is technically trained in any field, hasa myth he can run the business efficiently. However, additional management skills are required

to run the business. A small business owner, who wants to survive in the competition, not only

needs to take care of the above listed issues but also what a bigger entrepreneur would faceAn entrepreneur needs to carry total load of debts, long works hours are required to keep up

with no additional overtime or holiday pay which affects an individuals personal and social life.

Apart from these an entrepreneur also needs to assume all risks from start up throughoperations and customer satisfaction, he also needs to maintain and improve his expertise for

continues growth for which business concepts and marketing strategies are required. Needs to

anticipate competition and have strategies ready to face them

Small Business owner to a Successful Entrepreneurship

First of all a small business owner needs to have a vision and passion to succeed. There are

several points that needs to be kept in mind to drive a small business to the heights of roaring

success. Starting with having the right attitude, an entrepreneur needs to be optimistic, open

to new ideas and be willing to research , ask questions and reflect on mistakes to learn better.Secondly, Customer Focus. Study the market your business is catering to. Learn their demands,

the quality they are looking for and monitor the customer traffic. Thirdly, getting feedback

This is one important tool which helps you measure your standing with the customer. Anentrepreneur should keep in contact with an expert for constant feedback on what is going

right or what needs to be done improve a particular section. Not only this, customer feedbackalso needs to be in the limelight, which helps an entrepreneur use innovative ideas, for hisproduct according to the demand. Fourthly, Networking. In business you are judged by the

company you keep. Small businesses always need assistance. It is important to cash every

opportunity. An entrepreneur can make contact through the business meetings or parties whichlets you meet important people from different aspects of business who can help a business

grow.

Concluding the discussion. For an entrepreneurship his business is a vehicle for discovering and


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expressing his unique talent and his passion to succeed. For a small business ownerneeds more

drive and a successful entrepreneur to have the constant determination to achieve success forhis business.

Q2 a

Entrepreneurship pertains to businesses which are designed to address particular opportunities

Entrepreneurship is also defined as the process of determining, assessing and utilizingopportunities. Webster defined an entrepreneur as one who undertakes to start and conduct

an enterprise or business, usually assuming full control and risk."

Business is the social science of managing people to direct their collective efforts towards

accomplishing organization goals and to earn profits. It is derived from the word busy whichis often perceived as doing something productive commercially.

Since a number of new businesses fail, an integral part of entrepreneurship then is taking risks.

Entrepreneurs deal with these risks by creating solutions to problems. The vision of an

entrepreneur is what drives the entrepreneurship. It also takes a lot of hard work and

determination to grow an entrepreneurship.

Concept of Quality

The concept of quality is defined differently by various people. According to Gitlow et al., 1989or Ozeki and Asaka, 1990, quality means the expectations that accompany a product or service

being delivered which are: 1) is at par with customer standards, 2) meets and satisfy the needsof the customer, 3) meets the customer level of expectations, and 4) will meet unforeseen

needs and aims in the future.

Management Process in an Entrepreneurship

Management refers to the ways of the personnel in charge of directing the organization, which

in this instance is an entrepreneurship, through the utilization of resources such as labor,capital and assets whether tangible or intangible.

Being in the management connotes power and influence for the person. It is not unusual for an

entrepreneur to do all the management functions at the start of the business. It is only later

when the business grows that proper designation of functions can be made.

Managing an entrepreneurship means overseeing various functions such as:


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Planning - making decisions with regards to the future and making those plans happen

Organizing - utilizing the fullest potential of resources people, capital and assets to ensurethe success of the plans

Leading/Motivating - inspiring others to do their part effectively in carrying out the

organizations plansControlling - step by step monitoring of the implementation process to see if changes are

necessary to be made on the plans.

Entrepreneurs should establish and maintain an environment within the business to encourage

efficiency among employees. The functions of management involve planning, organizingdirecting, and controlling of resources. These functions are influenced by objectives set by the

entrepreneur. They are closely related to each other and interdependent.

Planning pertains to arriving at an efficient process to attain the objectives of the company. Itleads the company towards its goals. Organizing coordinates the resources that needed toimplement the plan. In organizing, company structure is established, relationships are formed

and resources are allotted appropriately to realize the objectives sought for. Directing refers

to leading and supervising employees to attain the company objectives. Finally, controlling is

confirming if the plan is carried out in actual situation.

Quality Management in an Entrepreneurship

Fundamentals of business include proper planning, setting up objectives, promoting customer

relationship, promoting supplier relationship, dealing with competition and use of accounting.

Knowing all these aspects could greatly facilitate the flow of the business. Managing these

aspects well or quality management would spell the difference between success and failure inbusiness. It is also important to know the legal aspects affecting the business and the need to

adhere to business ethics.

An entrepreneur needs to know the business fundamentals so it can manage the business well

Fundamentals of business include proper planning, setting up objectives, promoting customer

relationship, promoting supplier relationship, dealing with competition and proper use ofaccounting.

Having a plan and setting up objectives before embarking on a business or during business is

essential because it would be hard to provide a direction with which the business will follow

without vision.

Customer relationship is very essential to the business. How well you relate to the customerscould translate to profits in the income statement. Choosing the target market also falls under


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this. The target market must reflect the style, image and price point of the product you are

selling.

Supplier relationship is important because without suppliers securing raw materials to create

the finish product would be impossible. It is always good to establish good rapport with supplieras this would greatly facilitate the production process.

Competition is one of the threats to business. It is important to size up the competition to be

able to make your products competitive in the market. Allocating proper resources and taking

the time are important requirements to remain competitive.

Accounting is fundamental to business because it enables you to determine how the

entrepreneurship fares. Proper accounting methods enable one to have solid basis in making

sound management decisions and adopt necessary changes.

Q2 b

Challenges and Rewards of Becoming an Entrepreneur

The specific challenges and rewards you'll encounter when becoming an entrepreneurwill varydepending upon the nature of the business you intend to launch. Whether you plan to start a

home based business, or something on a larger scale, or you plan to launch your business alone orwith a partner, or your business falls within an industry that is regulated by specificgovernment legislation, all of these factors will impact the specific challenges you'll face as an

entrepreneur.

As well as seeking out general information on becoming an entrepreneur, in order to get a goodunderstanding of the the rewards and challenges that are specific to your industry, I'd suggest

seeking out advice from someone who has expertise in that industry.

Keep in mind, when you are thinking about business challenges, any challenges related to startinga new business do not need to be seen in a negative light. When talking about business start-ups

challenges are also referred to as barriers to entry. Barriers to entry are the things thatprevent others from starting a similar type of business. They may include issues like high start-

up costs, government regulations or specific skill requirements

If you find that your specific business idea carries with it some barriers to entry, that is not

necessarily a bad thing. As long as you can find ways around those barriers for your own


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company, the same barriers may keep other potential competitors from launching the same type

of business.

Because my space is a bit limited here, I've posted an article that more specifically answersyour question about the challenges and rewards of becoming an entrepreneur. You'll find a list

of specific rewards and challenges of being an entrepreneur here.

((((Money, money, money, its all about money This is obviously the major reward you canreceive from your effort. Their world will suddenly change and their financial problem wil

slowly disappears. More than that, financial opportunities will start to arise like mushroom in a

forest. Regarding their own specific situation, they all got a great signing bonus along withimportant increase in what used to be their salary. In the end, chances are they will also get

shares in that company as well. This could only mean good news for all of them. Pride and

recognition Do you feel pride of yourself when you conclude a sale for your employer, you win acontract for your employer or you achieve a major projectfor your employer? Imagine the

sensation for ones that does it for himself! It must be a great feeling to see your baby, your

own creation getting attention from the big guys. Your whole work and talent are beingrecognize through your company. Being an entrepreneur is more than being your own boss, it is

related to have a direct influence on your destiny. Every ideas, every thoughts, every moves are

beneficial for your own good. Becoming a successful entrepreneur would allow an individual to

fully accomplish himself and being recognize for it.Flexibility and powerHum making your own working hour, having the power of deciding your way of working, your

team mates and which project you will work on; it sounds like the perfect workplace! While youmight end up in this Cinderella Story, chances are that you will have to work more than a regular

employee and think about your business 24/7. It is true that if you company becomes stable and

money is coming in, you will benefit from a lot of flexibility and you will gain power over yourenvironment. However, in order to reach this level, you will have to achieve something that no

employee will ever perform; total donation to your company. My friend made a series of

continuous efforts over the past two years and was making barely enough to cover for his livingexpenses. He was working ten hours a day and sometimes over the weekend. He did not really

mind as he saw what was coming; he had a plan, he had a vision.

Fulfilling your dreamsEntrepreneurs are wild beast; they hate to be tamed and put in a cage. They need space so they

can think and evolve to something better. Creating your own business is a great way to fulfill

your dreams and to grow on a personal level. It is not only about money, its about yourselfThrough your company, you have a chance to grow and become a better person. While you are


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living your life, you are also creating an alter-ego. Another me that will take action by itself

and reward you with pride as a son who makes his first touch down.If this post woke up a part of you that wants to be part of the world of entrepreneurship, sit

down with a piece of paper and start thinking about what you could do in order to become

another man or woman, another entrepreneur.)))

Q3

Introduction

The role of the Human Resource Manager is evolving with the change in competitive market

environment and the realization that Human Resource Management must play a more strategic

role in the success of an organization. Organizations that do not put their emphasis onattracting and retaining talents may find themselves in dire consequences, as their competitors

may be outplaying them in the strategic employment of their human resources.

With the increase in competition, locally or globally, organizations must become more adaptable

resilient, agile, and customer-focused to succeed. And within this change in environment, the HR

professional has to evolve to become a strategic partner, an employee sponsor or advocate, and

a change mentor within the organization. In order to succeed, HR must be a business driven

function with a thorough understanding of the organizations big picture and be able to

influence key decisions and policies. In general, the focus of todays HR Manager is on strategicpersonnel retention and talents development. HR professionals will be coaches, counselors

mentors, and succession planners to help motivate organizations members and their loyalty. The

HR manager will also promote and fight for values, ethics, beliefs, and spirituality within their

organizations, especially in the management of workplace diversity.

This paper will highlight on how a HR manager can meet the challenges of workplace diversity

how to motivate employees through gain-sharing and executive information system through

proper planning, organizing, leading and controlling their human resources.

Workplace Diversity

According to Thomas (1992), dimensions of workplace diversity include, but are not limited to:

age, ethnicity, ancestry, gender, physical abilities/qualities, race, sexual orientation, educationa

background, geographic location, income, marital status, military experience, religious beliefs,

parental status, and work experience.


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The Challenges of Workplace Diversity

The future success of any organizations relies on the ability to manage a diverse body of talent

that can bring innovative ideas, perspectives and views to their work. The challenge and

problems faced of workplace diversity can be turned into a strategic organizational asset if anorganization is able to capitalize on this melting pot of diverse talents. With the mixture of

talents of diverse cultural backgrounds, genders, ages and lifestyles, an organization can

respond to business opportunities more rapidly and creatively, especially in the global arena

(Cox, 1993), which must be one of the important organisational goals to be attained. More

importantly, if the organizational environment does not support diversity broadly, one risks

losing talent to competitors.

This is especially true for multinational companies (MNCs) who have operations on a global scale

and employ people of different countries, ethical and cultural backgrounds. Thus, a HR manager

needs to be mindful and may employ a Think Global, Act Local approach in most circumstances

The challenge of workplace diversity is also prevalent amongst Singapores Small and Medium

Enterprises (SMEs). With a population of only four million people and the nations strive towards

high technology and knowledge-based economy; foreign talents are lured to share their

expertise in these areas. Thus, many local HR managers have to undergo cultural-based Human

Resource Management training to further their abilities to motivate a group of professional

that are highly qualified but culturally diverse. Furthermore, the HR professional must assure

the local professionals that these foreign talents are not a threat to their career advancement(Toh, 1993). In many ways, the effectiveness of workplace diversity management is dependent

on the skilful balancing act of the HR manager.

One of the main reasons for ineffective workplace diversity management is the predisposition

to pigeonhole employees, placing them in a different silo based on their diversity profile

(Thomas, 1992). In the real world, diversity cannot be easily categorized and those

organizations that respond to human complexity by leveraging the talents of a broad workforce

will be the most effective in growing their businesses and their customer base.

The Management of Workplace Diversity

In order to effectively manage workplace diversity, Cox (1993) suggests that a HR Manager

needs to change from an ethnocentric view ("our way is the best way") to a culturally relative

perspective ("let's take the best of a variety of ways"). This shift in philosophy has to be

ingrained in the managerial framework of the HR Manager in his/her planning, organizing

leading and controlling of organizational resources.


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Leading the Talk-

A HR Manager needs to advocate a diverse workforce by making diversity evident at all

organizational levels. Otherwise, some employees will quickly conclude that there is no future

for them in the company. As the HR Manager, it is pertinent to show respect for diversityissues and promote clear and positive responses to them. He/She must also show a high level of

commitment and be able to resolve issues of workplace diversity in an ethical and responsible

manner.

Control and Measure Results-

A HR Manager must conduct regular organizational assessments on issues like pay, benefits

work environment, management and promotional opportunities to assess the progress over the

long term. There is also a need to develop appropriate measuring tools to measure the impact of

diversity initiatives at the organization through organization-wide feedback surveys and other

methods. Without proper control and evaluation, some of these diversity initiatives may just

fizzle out, without resolving any real problems that may surface due to workplace diversity.

Motivational Approaches

Workplace motivation can be defined as the influence that makes us do things to achieve

organizational goals: this is a result of our individual needs being satisfied (or met) so that we

are motivated to complete organizational tasks effectively. As these needs vary from person to

person, an organization must be able to utilize different motivational tools to encourage their

employees to put in the required effort and increase productivity for the company.

Why do we need motivated employees? The answer is survival (Smith, 1994). In our changing

workplace and competitive market environments, motivated employees and their contributions

are the necessary currency for an organizations survival and success. Motivational factors in an

organizational context include working environment, job characteristics, appropriate

organizational reward system and so on.

The development of an appropriate organizational reward system is probably one of the

strongest motivational factors. This can influence both job satisfaction and employee

motivation. The reward system affects job satisfaction by making the employee more

comfortable and contented as a result of the rewards received. The reward system influences

motivation primarily through the perceived value of the rewards and their contingency on

performance (Hickins, 1998).


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To be effective, an organizational reward system should be based on sound understanding of

the motivation of people at work. In this paper, I will be touching on the one of the more

popular methods of reward systems, gain-sharing.

Gain-sharing:

Gain-sharing programs generally refer to incentive plans that involve employees in a common

effort to improve organizational performance, and are based on the concept that the resulting

incremental economic gains are shared among employees and the company.

In most cases, workers voluntarily participate in management to accept responsibility for major

reforms. This type of pay is based on factors directly under a workers control (i.e.,

productivity or costs). Gains are measured and distributions are made frequently through a

predetermined formula. Because this pay is only implemented when gains are achieved, gain-

sharing plans do not adversely affect company costs (Paulsen, 1991).

Managing Gain-sharing

In order for a gain-sharing program that meets the minimum requirements for success to be in

place, Paulsen (1991) and Boyett (1988) have suggested a few pointers in the effective

management of a gain-sharing program. They are as follows:

A HR manager must ensure that the people who will be participating in the plan areinfluencing the performance measured by the gain-sharing formula in a significant way by

changes in their day-to-day behavior. The main idea of the gain sharing is to motivate

members to increase productivity through their behavioral changes and working

attitudes. If the increase in the performance measurement was due to external factors,

then it would have defeated the purpose of having a gain-sharing program.

An effective manager must ensure that the gain-sharing targets are challenging butlegitimate and attainable. In addition, the targets should be specific and challenging but

reasonable and justifiable given the historical performance, the business strategy andthe competitive environment. If the gain-sharing participants perceive the target as an

impossibility and are not motivated at all, the whole program will be a disaster.

A manager must provide useful feedback as a guidance to the gain-sharing participantsconcerning how they need to change their behavior(s) to realize gain-sharing payouts The

feedback should be frequent, objective and clearly based on the members performance

in relation to the gain-sharing target.

A manager must have an effective mechanism in place to allow gain-sharing participantsto initiate changes in work procedures and methods and/or requesting new or additional


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resources such as new technology to improve performance and realize gains. Though a

manager must have a tight control of companys resources, reasonable and justifiable

requests for additional resources and/or changes in work methods from gain-sharing

participants should be considered.

Executive Information Systems

Executive Information System (EIS) is the most common term used for the unified collections

of computer hardware and software that track the essential data of a business' daily

performance and present it to managers as an aid to their planning and decision-making (Choo,

1991). With an EIS in place, a company can track inventory, sales, and receivables, compare

today's data with historical patterns. In addition, an EIS will aid in spotting significant

variations from "normal" trends almost as soon as it develops, giving the company the maximum

amount of time to make decisions and implement required changes to put your business back on

the right track. This would enable EIS to be a useful tool in an organizations strategic planning

as well as day-to-day management (Laudon, K and Laudon, J, 2003).

Managing EIS

As information is the basis of decision-making in an organization, there lies a great need for

effective managerial control. A good control system would ensure the communication of the

right information at the right time and relayed to the right people to take prompt actions.

When managing an Executive Information System, a HR manager must first find out exactly

what information decision-makers would like to have available in the field of human resource

management, and then to include it in the EIS. This is because having people simply use an EIS

that lacks critical information is of no value-add to the organization. In addition, the manager

must ensure that the use of information technology has to be brought into alignment with

strategic business goals (Laudon, K and Laudon, J, 2003).

Conclusion

The role of the HR manager must parallel the needs of the changing organization. Successfu

organizations are becoming more adaptable, resilient, quick to change directions, and customer-

centered. Within this environment, the HR professional must learn how to manage effectively

through planning, organizing, leading and controlling the human resource and be knowledgeable

of emerging trends in training and employee development.


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Q4 a

motivation

Definition

Internal and external factors that stimulate desire and energy in people to be continually

interested in and committed to a job, role, or subject, and to exert persistent effort inattaining a goal. Motivation is the energizer of behavior and mother of all action

It results from the interactions among conscious and unconscious factors such as the (1)

intensity of desire orneed, (2) incentive or reward value of the goal, and (3) expectations ofthe individual and of his or her significant others.

Motivation is a very important for an organization because of the following benefits it

provides:-

1. Puts human resources into actionEvery concern requires physical, financial and human resources to accomplish the goals. It

is through motivation that the human resources can be utilized by making full use of it

This can be done by building willingness in employees to work. This will help the enterprise

in securing best possible utilization of resources.

2. Improves level of efficiency of employeesThe level of a subordinate or a employee does not only depend upon his qualifications and

abilities. For getting best of his work performance, the gap between ability and

willingness has to be filled which helps in improving the level of performance of

subordinates. This will result into-

a. Increase in productivity,b.

Reducing cost of operations, andc. Improving overall efficiency.

3. Leads to achievement of organizational goalsThe goals of an enterprise can be achieved only when the following factors take place :-

a. There is best possible utilization of resources,b. There is a co-operative work environment ,c. The employees are goal-directed and they act in a purposive manner,


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d. Goals can be achieved if co-ordination and co-operation takes place simultaneouslywhich can be effectively done through motivation.

4. Builds friendly relationshipMotivation is an important factor which brings employees satisfaction. This can be doneby keeping into mind and framing an incentive plan for the benefit of the employees. This

could initiate the following things:

a. Monetary and non-monetary incentives,b. Promotion opportunities for employees,c. Disincentives for inefficient employees.

In order to build a cordial, friendly atmosphere in a concern, the above steps should be

taken by a manager. This would help in:

d. Effective co-operation which brings stability,e. Industrial dispute and unrest in employees will reduce,f. The employees will be adaptable to the changes and there will be no resistance to

the change,

g. This will help in providing a smooth and sound concern in which individual interestswill coincide with the organizational interests,

h. This will result in profit maximization through increased productivity.5. Leads to stability of work force

Stability of workforce is very important from the point of view of reputation and goodwil

of a concern. The employees can remain loyal to the enterprise only when they have a

feeling of participation in the management. The skills and efficiency of employees will

always be of advantage to employees as well as employees. This will lead to a good public

image in the market which will attract competent and qualified people into a concern. As

it is said, Old is gold which suffices with the role of motivation here, the older the

people, more the experience and their adjustment into a concern which can be of benefit

to the enterprise.

From the above discussion, we can say that motivation is an internal feeling which can be

understood only by manager since he is in close contact with the employees. Needs, wants and

desires are inter-related and they are the driving force to act. These needs can be understoodby the manager and he can frame motivation plans accordingly. We can say that motivation

therefore is a continuous process since motivation process is based on needs which are

unlimited. The process has to be continued throughout.


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We can summarize by saying that motivation is important both to an individual and a

business. Motivation is important to an individual as:

1. Motivation will help him achieve his personal goals.2. If an individual is motivated, he will have job satisfaction.3. Motivation will help in self-development of individual.4. An individual would always gain by working with a dynamic team.

Similarly, motivation is important to a business as:

1. The more motivated the employees are, the more empowered the team is.2. The more is the team work and individual employee contribution, more profitable and

successful is the business.

3. During period of amendments, there will be more adaptability and creativity.4. Motivation will lead to an optimistic and challenging attitude at work place.

Q4 b

How to Motivate Employees

Motivated employees can work wonders on your business. This article explains how to motivate

your employees. To be sure, happy and enthused employees will lead to triumph.

As a small business owner, you are the boss. But being the boss doesn't mean that you have to

act like a tyrant to get things done. When it comes to motivating your employees, it really istrue that you can get more done with a carrot than with a stick.

(article continues below)

The art of employee motivation really boils down to learning and practicing people skills. Your

ability to interact with your employees on a relational level will largely determine how

effectively you are able to motivate them to makeyour business a success.

(1) Demonstrate enthusiasm

In many ways, you set the tone for your employees. If you are unmotivated, expect your

employees to be unmotivated, too. Likewise, if you demonstrate enthusiasm for your work, it wil

carry over to your employees.

(2) Interface with your employees


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It's important that you interact directly with your employees on a regular basis. A prolonged

pattern of distance between you and your employees creates the perception of a cold, uncaringautocrat rather than the caring, compassionate leader you want to be. Step out from behind

that desk periodically and let your employees interact with you face to face.

(3) Celebrate accomplishments

Take time out to celebrate accomplishments as a company. When you've asked your employees

to go the extra mile to complete a major project, it's not unreasonable for them to expect tocelebrate a little bit. This can be as simple as ordering a pizza or as extravagant as organizing

an annual holiday party outside of the office. What you do isn't as important recognizing a job

well done.

(4) Offer incentives

With incentives, cash isn't always king. Sometimes the best incentives require a little creativityon your part. In addition to offering flex time for employees who demonstrate outstanding

service and performance, you can do things like offer theater tickets or restaurant gift

certificates to the "employee of the month". Part of the fun is creating an atmosphere where

your employees don't know what their reward will be until they have achieved their goal.

(5) Treat your employees with kindness

Kindness and understanding on your part will go a long way toward motivating your employees tohelp you achieve your goals as an entrepreneur. Unexpected events such as sick kids or other

personal crises can interfere with the daily flow of the workplace. But no matter how manyproblems these occurrences cause for you, you can be guaranteed that they have created many

more problems for your employee.

As much as possible, try to give your employees the space they need to care for their families.

The result will be happier employees who are more likely to give you all they've got once their

family crisis has subsided.

(6) Listen

Above all else, listen to what your employees' have to say and let them know how much you value

their input. The loyalty it inspires in your employees will make it well worth your while.

Q5

20 challenges faced by a family owned business


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Every business organization has a unique set of challenges and problems. The family business is

no different. Many of these problems exist in corporate business environments, but can be

exaggerated in a family business.

Family business go through various stages of growth and development over time. Many of thesechallenges will be found once the second and subsequent generations enter the business.

A famous saying about family owned business in Mexico is Father, founder of the company, son

rich, and grandson poor (Padre noble, hijo rico, nieto pobre). The founder works and builds abusiness, the son takes it over and is poorly prepared to manage and make it grow but enjoys

the wealth, and the grandson inherits a dead business and and empty bank account.

Prepare now and help your grandson avoid the poorhouse.

20 challenges for the family business

1. Emotions. Family problems will affect the business. Divorce, separations, health orfinancial problems also create difficult political situations for the family members.

2. Informality. Absence of clear policies and business norms for family members3. Tunnel vision. Lack of outside opinions and diversity on how to operate the business.4. Lack of written strategy. No documented plan or long term planning.5. Compensation problems for family members. Dividends, salaries, benefits and

compensation for non-participating family members are not clearly defined and justified.

6. Role confusion. Roles and responsibilities must be clearly defined.7. Lack of talent. Hiring family members who are not qualified or lack the skills and abilities

for the organization. Inability to fire them when it is clear they are not working out.

8. High turnover of non-family members. When employees feel that the family mafia wilalways advance over outsiders and when employees realize that management is

incompetent.

9. Succession Planning. Most family organizations do not have a plan for handing the powerto the next generation, leading to great political conflicts and divisions.

10.Retirement and estate planning. Long term planning to cover the necessities and realitiesof older members when they leave the company.

11.Training. There should be a specific training program when you integrate family membersinto the company. This should provide specific information that related to the goals

expectations and obligations of the position.12.Paternalistic. Control is centralized and influenced by tradition instead of good

management practices.

13.Overly Conservative. Older family members try to preserve the status quo and resistchange. Especially resistance to ideas and change proposed by the younger generation.


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14.Communication problems. Provoked by role confusion, emotions (envy, fear, anger)political divisions or other relationship problems.

15.Systematic thinking. Decisions are made day-to-day in response to problems. No long-term planning or strategic planning.

16.Exit strategy. No clear plan on how to sell, close or walk away from the business.17.Business valuation. No knowledge of the worth of the business, and the factors that make

it valuable or decrease its value.

18.Growth. Problems due to lack of capital and new investment or resistance to re-investment in the business.

19.Vision. Each family member has a different vision of the business and different goals.20.Control of operations. Difficult to control other members of the family. Lack of

participation in the day-to-day work and supervision required

Turning Family Business

Challenges into Victories

There are unique family business challenges that non-family owned companies do not face. Yetwhen the strong family ties are directed towards a common vision, a family owned business can

achieve impressive success.

There is no question that family business challenges can be daunting, yet when converted

into success the results can be impressive. In a family business, there are emotional issues

usually not found in non-family owned businesses, and it is important to confront these issuesand lay them to rest.

For example, many family owned businesses were started by the patriarch or matriarch of the

family, and the second generation now feels it is time for him or her to retire. These kinds of

issues can hold a company back from moving ahead in a competitive business environment.

The key to dealing with the issues related to a family business is to take those challenges and

turn them into victories. Though a family owned business has a management structure that has a

whole different dimension from other companies, the generations have a unique opportunity touse those strong bonds to create a company with a vision for the future. In other words, a

family business can, and should, create a viable company mission supported by strategic

planning with the goal of strengthening the company for future generations.

The Family Vision

The family that creates and expands a business knows they want the business to be long-lasting

for generations to come. The development of a clear mission is critical to success. Yet there


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are plenty of family owned businesses that have just gone with the flow, so to speak. The

company started small and then grew through demand for its products or services, but there isno real long-term planning that has taken place. Thiscan cause the emotional issues to take a

front seat to the strategic operation of the business.

That is why many family owned businesses have turned to business consultants for assistance

with long term planning. A management consultant that understands the special emotional issuesinvolved in a family owned business can work with management to develop or refine a mission

statement, establish specific goals, and create a strategic plan for reaching those goals. It is

like having a dispassionate consultant who assists the family management by focusing on the real

issues related to long term growth and economic health.

Mastering the Future

Family business challenges can be turned into long term victories that equate to a thriving

business enterprise for many generations to come. Family businesses can capitalize on the

strengths that family members bring to the company, and use those strengths to create astrong mission statement that provides future direction. With everyone on the same path,

the family management team becomes one of the company's strongest assets.

Entrepreneur Asg 2

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