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After studying this chapter, you should be able to:
Ø state the meaning of the terms, ‘entrepreneur,’ ‘entrepreneurship’ and ‘enterprise’;
Ø distinguish between entrepreneurship and management and discuss the characteristics of entrepreneurship;
Ø explain the need for entrepreneurship;
Ø describe the roles and functions of the entrepreneurs;
Ø identify the entrepreneurial competencies;
Ø explain and follow the process of entrepreneurship development; and
Ø identify the values, attitudes and motivation for a plunge in entrepreneurship.
CHAPTER
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SSSSSEEDSEEDSEEDSEEDSEEDS OFOFOFOFOF VVVVVIRCHOWIRCHOWIRCHOWIRCHOWIRCHOW
Until 1981 Narayan Reddy, M.Sc. Organic Chemistry, had been working for a pharmaceutical company where he had developed a molecule. He was contemplating commercial utilisation of that molecule by setting up a small-scale unit – much smaller than what he actually started. Actually, he met two medicos, who had just returned from a Gulf country and were looking for some productive avenue for investment of their savings (remember the Gulf crisis?), Reddy’s idea appealed to them. Thus, the willing entrepreneurs met– where there is a will there is a way– and the seeds for the venture were sown. After a detailed study of the technical, economic, commercial and financial feasibility of the idea of manufacturing a bulk drug from the molecule, ‘Virchow Laboratories’ was started in 1982 as a SSI with an initial investment of Rs. 28 lakhs – Rs. 8 lakh in the form of equal contribution by the three promoters and Rs. 20 lakh funding from the Andhra Pradesh State Finance Corporation (APSFC). Project implementation was even more challenging as he set out to acquire land, construct factory, purchase equipment, negotiate with suppliers, potential customers and obtain environmental, drug control and other clearances. Initially, it was he who acted as the pivot of the enterprise wheel. In the course of time, a strong managerial team was put in place and thanks to persistent emphasis on good management
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And, in the process, entrepreneurship becomes crucial for overall economic development of a nation. Given its important role in the overall scheme of economic development, it is interesting to note that not many persons opt for a career in entrepreneurship. Traditionally, it was believed that entrepreneurs are born. No society can wait for the chance of ‘birth’ of entrepreneurs to pursue its developmental plans. In fact, plans for economic development would bear little fruit unless entrepreneurship development is regarded as a deliberate process of making people aware of entrepreneurship as a career at an early age and creating situations where they may actually make a choice to become entrepreneurs. When you make this choice, you become a job-provider rather than a job-seeker, besides enjoying a host of other financial and psychological rewards. Taking to entrepreneurship is surely more a matter of aspiring to become an entrepreneur rather as being born as one.
IIIII NTRODUCTIONNTRODUCTIONNTRODUCTIONNTRODUCTIONNTRODUCTION
Entrepreneurship is the process of setting up one’s own business as distinct from pursuing any other economic activity, be it employment or practising some profession. The person who set-up his business is called an entrepreneur. The output of the process, that is, the business unit is called an enterprise. You may invoke ‘subject- verb-object (SVO)’ relationship in English grammar to clearly understand these terms. (See Figure on SVO Analogy) It is interesting to note that entrepreneurship besides providing self-employment to the entrepreneur is responsible to a great extent for creation and expansion of opportunities for the other two economic activities, that is, employment and profession. (Can you think why and how?) Further, each business gives rise to other businesses– the suppliers of raw materials and components, service providers (be it transport, courier, telecom, distributor middlemen and advertising firms, accounting firms and advocates etc.
practices, Virchow emerged as the world’s largest and the best producer of the basic drug from the chosen molecule. In fact, web search on ‘Virchow Laboratories’ takes you to the home page saying “Welcome to Virchow Group of Companies”, the group comprising 4 companies with Virchow Laboratories being the flagship company.
Entrepreneur Entrepreneurship Enterprise
The Person/The Actor The Process/The Act The Outcome SSSSSubject VVVVVerb OOOOObject
SVO AnalogySVO AnalogySVO AnalogySVO AnalogySVO Analogy
ENTREPRENEURSHIP DEVELOPMENT 391 We would like to define entrepre- neurship as a systematic, purposeful and creative activity of identifying a need, mobilising resources and organising production with a view to delivering value to the customers, returns for the investors and profits for the self in accordance with the risks and uncertainties associated with business. This definition points to certain characteristics of entrepreneurship that we turn our attention to.
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In the SVO formulation of the concepts of entrepreneur, entrepreneurship and enterprise, we saw that entrepreneur- ship is about the process of setting up a business. One cannot help but marvel at the beauty of the process: how
does one first of all decide to choose own business as a career; how does one sense a market opportunity; how does one muster up courage to embark upon it, and mobilise the requisite resources, etc.; so much so that recourse to entrepreneurship, in common parlance, is considered as an exclusive preserve of a few gifted individuals. In the following paragraphs, our effort would be to establish entrepreneurship as a career that you should aspire for. Remember, resources may be limited, aspiration need not be. So, you can aspire for something greater, bigger than your present status and resources. And start today. Remember, aspiration means desire multiplied by action. 1.1.1.1.1. SystematicSystematicSystematicSystematicSystematic Activity:Activity:Activity:Activity:Activity: Entrepre- neurship is not a mysterious gift or
Nurturing Success
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charm and something that happens by chance! It is a systematic, step-by- step and purposeful activity. It has certain temperamental, skill and other knowledge and competency requirements that can be acquired, learnt and developed, both by formal educational and vocational training as well as by observation and work experience. Such an understanding of the process of entrepreneurship is crucial for dispelling the myth that entrepreneurs are born rather than made.
- Lawful and Purposeful Activity:2. Lawful and Purposeful Activity:2. Lawful and Purposeful Activity:2. Lawful and Purposeful Activity:2. Lawful and Purposeful Activity: The object of entrepreneurship is lawful business. It is important to take note of this as one may try to legitimise unlawful actions as entrepreneurship on the grounds that just as entrepreneurship entails risk, so does illicit businesses. Purpose of entrepre- neurship is creation of value for personal profit and social gain.
3 .3 .3 .3 .3. Innovation:Innovation:Innovation: From the point ofInnovation:Innovation: view of the firm, innovation may be cost saving or revenue-enhancing. If it does both it is more than welcome. Even if it does none, it is still welcome as innovation must become a habit! Entrepreneurship is creative in the sense that it involves creation of value. You must appreciate that in the absence of entrepreneurship ‘matter’ does not become a “resource.” By combining the various factors of production, entrepreneurs produce goods and services that meet the needs and wants of the society. Every entrepreneurial act results in income and wealth generation. Even when innovations destroy the existing
industries, for example, zerox machines destroyed carbon paper industry, mobile telephony threatens landline/ basic telephony, net gains accruing to the economy lend such entrepreneurial actions as commendable as the acts of creative destruction. Entrepreneurship is creative also in the sense that it involves innovation- introduction of new products, discovery of new markets and sources of supply of inputs, technological breakthroughs as well as introduction of newer organisational forms for doing things better, cheaper, faster and, in the present context, in a manner that causes the least harm to the ecology/environment. It is possible that entrepreneurs in developing countries may not be pioneering/ innovative in introducing path- breaking, radical innovations. They may be the first or second adopters of technologies developed elsewhere. That does not make their achievement small. For imitating technologies from developed world to the indigenous setting is quite challenging. A lady entrepreneur wanting to introduce thermal pads for industrial heating faced tremendous reluctance form the owners of chemical and sugar mills despite the established superiority of her products over the conventional heating of the vessels by burning of wood/coke or using LPG. Moreover, there is no need to suffer from “it was not invented here” complex– there is no need to reinvent the wheel. The global electronics major, Sony did not invent the transistor! It used the
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but what the person has taken is a calculated risk. The situation is similarly to a motorcyclist in the ‘ring of death’ or a trapeze artist in circus. While the spectators are in the awe of the high-risk, the artists have taken a calculated risk given their training, skills, and of course, confidence and daring. It is said that the entrepreneurs thrive on circumstances where odds favouring and against success area even, that is 50:50 situations. They are so sure of their capabilities that they convert 50% chances into 100% success. They avoid situations with higher risks as they hate failure as anyone would do; they dislike lower
risk situations as business ceases to be a game/fun! Risk as such more than a financial stake, becomes a matter of personal stake, where less than expected performance causes displeasure and distress. The characteristics of entrepreneur- ship discussed as above apply in diverse contexts, so does the usage of the term, viz., Agricultural/Rural Entrepreneurship, Industrial entrepre- neurship, Technopreneurship, Netpre- neurship, Green/Environmental or Ecopreneurship, Intra-corporate/firm or Intrapreneusrhip and Social entrepreneurship. In fact, entrepre- neurship has come to be regarded as a
Understanding Entrepreneurial Returns and RisksUnderstanding Entrepreneurial Returns and RisksUnderstanding Entrepreneurial Returns and RisksUnderstanding Entrepreneurial Returns and RisksUnderstanding Entrepreneurial Returns and Risks Entrepreneurial returns are based on a mathematical expectation, E (Ri) where the subscript ‘i’ shows that there are a number of possible rates of return from a business decision, say, 20%, 18%, 17% and 15%. Actually, there may be quite a large distribution of alternative returns from an investment decision, we have taken just 4 observations to keep it simple. Supposing all these returns are equally likely, then E (Ri) would be the simple average of these returns. That is, E (Ri) = φ = 20+18+17+15/4= 17.5%. In other words, the expected returns from the entrepreneurial decision in this case are 17.5 %. Risk can be measured in terms of a measure of variation around this expectation, more precisely it is the standard deviation of the distribution of returns or óRi. In this case it works out be 1.8 %. In other words, actual or realised returns may deviate from expected returns to the extent of 1.8%. Clearly, higher the value of standard deviation, larger the risk. It is often said that higher the risk greater the returns. What this means is as under: (a) for a given risk, a rational person would prefer a higher than or equal to the expected returns. (b) for a given return, a rational person would prefer a lower risk. (c) should the risk increase, there should be at least a proportional increase in returns. (d) because the risk runs either ways, that is, realised returns may be more or less that the expected returns, entrepreneurs who are incorrigibly optimistic, tend to believe that variation would only be one-sided, that is, on the higher side.
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‘type of behaviours’, whereby one, (i) rather than becoming a part of the problem, proactively tries to solve it; (ii) uses personal creativity and intellect to develop innovative solutions; (iii) thinks beyond resources presently controlled in exploiting the emerging opportunities or attending to the impending problems; (iv) has the conviction to convince others of one’s ideas and seek their commitment towards the project; and (v) has the courage of heart to withstand adversities, persist despite setbacks and be generally optimistic.
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Entrepreneurship is about business start-ups and renewals. That is, it appears at the time of starting a new business, disappears for some time in the course of stabilising the venture as an on-going business and reappears in case there is a need for introducing changes in product, market, technology, structure and so on. In fact, it is said that everyone is an entrepreneur when he actually ‘carries out new combinations,’ and loses that character as soon as he has built up his business, when he settles down to running it as other people run their businesses. In developed countries, the distinction between the entrepreneurial focus on start-ups and managerial focus on routine is so sharp that it is argued that once the project has reached a level of maturity, the entrepreneurs must move out and the managers must come in.
In developing countries, however, the concept of owner-manager seems more apt for entrepreneurship as the entrepreneur remains attached even to the day-to-day operations of the venture. In fact, their lacking in managerial skills is often forwarded as the cause of business failures. Just as managers are expected to play entrepreneurial roles in the times of need, likewise the entrepreneurs must also demonstrate managerial abilities for the success of their ventures. Irrespective of whether the entrepreneurs pave way for the managers or they themselves assume the managerial responsibilities, it is possible to distinguish between the terms entrepreneurship and management. (See the table on next page)
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Every country, whether developed or developing, needs entrepreneurs. Whereas, a developing country needs entrepreneurs to initiate the process of development, the developed one needs entrepreneurship to sustain it. In the present Indian context, where on the one hand, employment opportunities in public sector and large-scale sector are shrinking, and on the other, vast opportunities arising from globalisation are waiting to be exploited; entrepreneurship can really take India to the heights of becoming a super economic power. (See the Box entitled ‘India Needs Entrepreneurs’) Studies by Global Entrepre- neurship Monitor, a research programem involving annual assessment of the
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national level of entrepreneurial activity across a number of countries (visit, www.gemconsortium.org) show that differences in the levels of entrepreneurial activity account for the differences in the level of economic growth to the extent of as much as 33%. What is that the entrepreneurs do to affect economic development? This leads us to a discussion of the functions of the entrepreneurs in relation to economic development. As the enterprise is the object of their endeavour, it is also necessary that we examine their functions in relation to the enterprise as well. Thus, the need for entrepre- neurship arises from the functions the entrepreneurs perform in relation to the process of economic development and in relation to the business enterprise.
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You are aware that entrepreneurs “organise” the production process. In
the absence this function, all other resources, namely land, labour and capital would remain idle. They may not be inventing/discovering the products, their role in commercial exploitation of the advancements in science and technology via organisation of the productive apparatus makes the other resources productive and useful. So much so that it is said that in the absence of entrepreneurial intervention, every plant would remain a weed and every mineral would remain a rock. 1.1.1.1.1. Contribution to GDP:Contribution to GDP:Contribution to GDP:Contribution to GDP:Contribution to GDP: Increase in the Gross Domestic Product or GDP is the most common definition of economic development. You are aware that income is generated in the process of production. So, entrepreneurs generate income via organisation of production be it agriculture, manufacturing or services. You are also aware that income generated is distributed among the factors of production where land gets rent, labour gets wages and salaries, capital gets interest and the residual income accrues to the entrepreneur in
India needs EntrepreneursIndia needs EntrepreneursIndia needs EntrepreneursIndia needs EntrepreneursIndia needs Entrepreneurs It needs them for two reasons: to capitalise on new opportunities and to create wealth and new jobs. A McKinsey and Company–Nasscom report estimates that India needs at least 8,000 new businesses to achieve its target of building a $ 87 billion IT sector by 2008. Similarly, in the next 10 years, 110-130 million Indian citizens will be searching for jobs, including 80-100 million looking for their first jobs; that’s seven times Australia’s population. This does not include disguised unemployment of over 50% among the 230 million employed in rural India. Since traditional large employers – including the government and the old economy players – may find it difficult to sustain this level of employment in the future, it is entrepreneurs who will create these new jobs and opportunities. Source: http://www.uwcsea.edu. (First published in India Today,Source: http://www.uwcsea.edu. (First published in India Today,Source: http://www.uwcsea.edu. (First published in India Today,Source: http://www.uwcsea.edu. (First published in India Today,Source: http://www.uwcsea.edu. (First published in India Today, February 2001)February 2001)February 2001)February 2001)February 2001)
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the form of profits. As rent and interest accrue to those few who have land and capital respectively whereas larger masses are destined to earn their incomes via wage employment, the biggest contribution of the entrepreneurship lies in capital formation and generation of employment. This is what we turn our attention to.
- Capital Formation:2. Capital Formation:2. Capital Formation:2. Capital Formation:2. Capital Formation: The entrepre- neurial decision, in effect, is an investment decision that augments the productive capacity of the economy and hence results in capital formation. In fact, GDP and capital formation are related to each other via Capital Output
Ratio (COR); more precisely Incremental Capital Output Ratio (ICOR) that measures the percentage increase in capital formation required obtaining a percentage increase in GDP. So, if a country desires to grow @ 10.0 % p.a. and its ICOR is 2.6, then it must ensure capital formation @ 26.0% p.a. Entrepreneurs, by investing their own savings and informally mobilising the savings of their friends and relatives contribute to the process of capital formation. These informal funding supplements the funds made available by the formal means of raising resources from banks, financial institutions and capital markets.
Capital Formation
BUSINESS STUDIES 400 Small-Scale Entrepreneurship among Marginalised Groups in IndiaSmall-Scale Entrepreneurship among Marginalised Groups in IndiaSmall-Scale Entrepreneurship among Marginalised Groups in IndiaSmall-Scale Entrepreneurship among Marginalised Groups in IndiaSmall-Scale Entrepreneurship among Marginalised Groups in India
Marginalised GroupsMarginalised GroupsMarginalised GroupsMarginalised GroupsMarginalised Groups ProportionalProportionalProportionalProportionalProportional RepresentationRepresentationRepresentationRepresentationRepresentation in Overall Entrepreneurship (%)in Overall Entrepreneurship (%)in Overall Entrepreneurship (%)in Overall Entrepreneurship (%)in Overall Entrepreneurship (%) Women Entrepreneurs 8 Scheduled Caste (SC) Entrepreneurs 8 Scheduled Tribes (ST) Entrepreneurs 4 Entrepreneurs from the Other 49 Backward Classes (OBC)
Source: Third Census of Small Scale Industries in India, Ministry of SmallSource: Third Census of Small Scale Industries in India, Ministry of SmallSource: Third Census of Small Scale Industries in India, Ministry of SmallSource: Third Census of Small Scale Industries in India, Ministry of SmallSource: Third Census of Small Scale Industries in India, Ministry of Small Scale Industries, Government of IndiaScale Industries, Government of IndiaScale Industries, Government of IndiaScale Industries, Government of IndiaScale Industries, Government of India
about sectoral change. You must be aware that as the economies grow, percentage of GDP originating from agriculture decreases and that originating in industry and services sectors goes up. Entrepreneurs through their decisions to divest from the stale sectors and invest in green-field sectors bring about a virtual transformation of the economy from ‘underdeveloped’ to an ‘emerging’ and ‘developed’ status.
7.7.7.7.7. Impact on Local Communities:Impact on Local Communities:Impact on Local Communities:Impact on Local Communities:Impact on Local Communities: Entrepreneurship, in its natural habitat, that is, small business is a great leveler. You may see from table on marginalised groups. That small-scale entrepre-neurship enables such marginalised groups as women, SC, ST and OBC to pursue their economic dreams. As there are no entry barriers in terms of educational qualifications, entrepreneurship is an even more attractive career option for such marginalised groups.
Agro-based rural industries and craft- based cottage industries can really catapult local communities to socio-economic
success stories. Local governments do their bit in developing these entrepreneurship clusters with a view to encouraging inter-firm collaboration and development of common facilities. entitled, ‘Entrepreneurship Clusters in India.’ In regard to the development of entrepreneurship for impacting local communities, some corporate-sector initiatives also deserve a mention. ITC through their ‘e-Chaupal’ (visit http:/ www.itcportal.com agri_exports/ e-choupal_new.htm) and HLL through their ‘Shakti’ (visit www.hllshakti.com) initiatives have sought to mobilise native entrepreneurs for improving the lot of those lying at the bottom of the economic pyramid. 8.8.8.8.8. Fostering the Spirit of Exploration,Fostering the Spirit of Exploration,Fostering the Spirit of Exploration,Fostering the Spirit of Exploration,Fostering the Spirit of Exploration, ExperimentationExperimentationExperimentationExperimentationExperimentation andandandandand Daring:Daring:Daring:Daring:Daring: Economic development, among other things, requires breaking away from the shackles of traditions and beliefs that restrict growth. For example if ‘crossing the seas’ were a taboo, there would not have been international trade and the resultant economic growth.
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The established ways of life need to be challenged and change must be seen as an opportunity to improve rather than something to be scared of. Entrepreneurs, through their urge to do something new, seeing change as an opportunity, experimenting with the novel ideas and showing the courage to try them prepare a fertile ground for persistent economic development. Have you seen the Hindi movie ‘Lagaan,’ where the protagonist Bhuvan raises a
cricket team from the villagers who had not even seen the game? Don’t the feats of Karasn Bhai of ‘Nirma’ who challenged ‘Surf’ from the mighty Hindustan Lever Limited make you proud of the daring of the entrepreneurs? Thus, whether one looks at economic development narrowly in terms of the increase in GDP or in the wider context of economic, institutional and social change, entrepreneurship plays a
Indian Small and Medium Enterprises (SME) ClustersIndian Small and Medium Enterprises (SME) ClustersIndian Small and Medium Enterprises (SME) ClustersIndian Small and Medium Enterprises (SME) ClustersIndian Small and Medium Enterprises (SME) Clusters With a contribution of 40% to the country’s industrial output and 35% to direct exports, the Small-Scale Industry (SSI) sector has achieved significant milestones for the industrial development of India. Within the SSI sector, an important role is played by the numerous clusters that have been in existence for decades and sometimes even for centuries. According to a United Nations Industrial Development Organisation (UNIDO), there are 388 SSI clusters having 4,90,000 enterprises, employing 7.5 million persons with an output of Rs. 160,000 crore p.a. The number. of entrepreneurs in these clusters has been growing @ 15-18% p.a. over the last ten years. Besides, there are approximately 2000 rural and artisan based clusters in India. Some Indian SSE clusters are so big that they account for 90 per cent of India’s total production output in selected products. As for example, the knitwear cluster of Ludhiana and Hosiery cluster in Tripur in Tamil Nadu. Almost the entire Gems and Jewellery exports are from the clusters of Surat and Mumbai. Similarly, the clusters of Chennai, Agra and Kolkata are well known for leather and leather products. However, the majority of Indian clusters, especially in the handicrafts sector, are very small with no more than hundred workers, so specialised that no other place in the world matches their skills and the quality of their output. This is the case, for example, of the Paithani sarees cluster in Maharashtra. However, only a tiny minority of such artisan clusters are globally competitive. The formidable challenges created for the SSE sector by the liberalisation of the Indian economy, as well as its closer integration within the global economy, have generated a great deal of interest within India on novel approaches to SSE development. As a result, both private and public sector institutions at the Central as well as the State levels are increasingly undertaking cluster development initiatives. Source:Source:Source:Source:Source: www.smallindustryindia.comwww.smallindustryindia.comwww.smallindustryindia.comwww.smallindustryindia.comwww.smallindustryindia.com
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Roles and Functions of the Entrepreneur in relation the EnterpriseRoles and Functions of the Entrepreneur in relation the EnterpriseRoles and Functions of the Entrepreneur in relation the EnterpriseRoles and Functions of the Entrepreneur in relation the EnterpriseRoles and Functions of the Entrepreneur in relation the Enterprise
Developing Exchange Relationships
- Perceiving market opportunities
- Gaining command over scarce resources
- Purchasing inputs
- Marketing of Products and responding to competition
Political Administration
- Dealing with public bureaucracy (approvals, concessions, taxes)
- Managing human relations within the firm
- Managing customer and supplier relations.
Management Control
- Managing finance
- Managing production
Technology
- Acquiring and overseeing assembly of the factory
- Industrial engineering (minimising inputs with a given production process)
- Upgrading the production process and product quality
- Introducing new production techniques and products.
Note:Note:Note:Note:Note: The scope of the entrepreneurial functions varies with the level of economy in which the entrepreneur operates; scale of production/operations; and entrepreneurs’ comparative efficiency in utilising managerial employees. In developed countries, entrepreneurship assumes upon themselves the responsibility of introducing innovations and after some time, pave way for the managers. In large-scale organisations, entrepreneurs provide leadership and there is a team of managers to look after specific aspects of enterprise. Likewise, those entrepreneurs who have the ability and willingness to delegate may concentrate on a select few, strategic aspects of enterprise. In terms of the process of setting up a business, therefore, an entrepreneur is on the look out for and spots the business opportunity, assesses its value, develops it in the form of a product/service idea, assembles he resources and gets going.
Source: Peter Kilby, (ed.), Entrepreneurship and EconomicSource: Peter Kilby, (ed.), Entrepreneurship and EconomicSource: Peter Kilby, (ed.), Entrepreneurship and EconomicSource: Peter Kilby, (ed.), Entrepreneurship and EconomicSource: Peter Kilby, (ed.), Entrepreneurship and Economic Development,? New York: The Free Press, 1971.Development,? New York: The Free Press, 1971.Development,? New York: The Free Press, 1971.Development,? New York: The Free Press, 1971.Development,? New York: The Free Press, 1971.
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p l a y e r s a n d h o w– b y s e l l i n g i t cheaper, by providing more value or by better service and so on. Entrepreneurial opportunities may also be identified through a process of research of international, domestic, sectoral/ industrial analysis. For example, post WTO, international trade and investment have become freer of restrictions. Textile quotas are being phased out, and, there are greater opportunities for textile and textile made-ups from India. Global outsourcing is on the rise and India
offers a huge and varied pool of technical manpower that makes it a cost effective destination for in-bound global outsourcing in manufacturing as well as Information Technology Enabled Services (ITES). Identification of Specific ProductIdentification of Specific ProductIdentification of Specific ProductIdentification of Specific ProductIdentification of Specific Product Offering:Offering:Offering:Offering:Offering: While the environment scan leads to the discovery of more generalised business opportunities, there is a need to zero in on to a specific product or service idea. For example, trade liberalisation since WTOs has resulted in export opportunities, but
Resource mobilisation
Scanning the environment for entrepreneurial opportunities
Development of product/service idea
Assessment of feasibility of the idea and preparation of a business plan
Appraisal by the funding agencies
Project Commissioning and launch
Adaptation and management of growth
Process of Setting up a BusinessProcess of Setting up a BusinessProcess of Setting up a BusinessProcess of Setting up a BusinessProcess of Setting up a Business
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amount. Recall, Narayan Reddy and his two other associates provided Rs. 8 lakhs and the APSFC contributed Rs. 20 lakhs toward the overall project cost of Rs. 28 lakhs. Upon the project approval, the entrepreneur can proceed for project commissioning, that is putting up the factory premises, installing the equipment, obtaining the supplies of the input materials with a
view to starting the manufacture and marketing the product. As noted earlier too, entrepreneurial functions do not come to an end with the business start-up. He often looks after its day-to-day operations and strives for its stability and growth. Entrepreneurial roles and functions clearly seem onerous. Perhaps that is why many shy away
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to simpler, softer and safer options of employment and practice of profession. Entrepreneurial going may be tough; but then that is where the tough get going! Do not worry if presently you may find yourself short on those competencies, values and attitudes. It is just a matter of making up your mind for a career in entrepreneurship and grooming yourselves for it. This takes us to the discussion of the process of entrepreneurship development.
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Entrepreneurship does not emerge spontaneously. Rather it is the outcome of a dynamic process of interaction
between the person and the environment. Ultimately the choice of entrepreneurship as a career lies with the individual, yet he must see it as a desirable as well as a feasible option. In this regard, it becomes imperative to look at both the factors in the environment as well as the factors in the individual as having a nearing on the perception of desirability and feasibility and thereby entrepreneurship development. One may, therefore, model the process of entrepreneurship development in terms. In general, capitalist economy with its emphasis on individual achievement is more suitable for entrepreneurship. Lower rates of taxation on personal income, lower rates of interest and moderate inflation stimulate
Technical
Administrative/Legal Economic
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Aspects of Feasibility AnalysisAspects of Feasibility AnalysisAspects of Feasibility AnalysisAspects of Feasibility AnalysisAspects of Feasibility Analysis
