Download Entrepreneurial Development Download free online book chm pdf. Check our section of free e-books and guides on Entrepreneurship now! This note covers the following topics: Developing the Entrepreneurial Mindset, Ideation, Customer . Business Environment And Entrepreneurship (PDF P). Need and Significance of Entrepreneurship Development in Global Entrepreneurship development programs, or EDPs in short, are Many educational materials (e.g., distance learning courses or business books) can.
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In book: Advances in Lac Production, Processing, Product Development and Value Addition, Edition: First Edition , Chapter: 22, Publisher. ENTREPRENEURSHIP DEVELOPMENT. And, in the process, entrepreneurship becomes crucial for overall economic development of a nation. Given its. this book contain broad discussion about entrepreneur, traits, types, characteristics, theories.
Clipping is a handy way to collect important slides you want to go back to later. They prefer the challenge of working at a problem and accepting the personal responsibility for success or failure, rather than leaving the outcome to chance or the actions of others. Our accumulated experience suggests that with an increase in capital investment, capital- output ratio also tends to increase. Sanjay Deshmukh, Dr. In fact it was the highly helpful society that made the industrial revolution a glorious success in Europe. Unique in the sense that it is an independent enterprise whose business is the process of 'incubating' enterprises.
Drone Entrepreneurs - Who may suffer loss but are not ready to make changes in the existing methods. Solo Operators - Who work alone or employ very few employees. Active Partners - Who work better in partnership rather than alone. Challengers - Who always look for new challenges.
Buyers - who do not like to bear much risk. Instead of manufacturing they go for trading. Lifetimers - Who take business as an integral part of their life. Features of Successful entrepreneurs According to David C. McClelland, entrepreneurs can become high achi evers striving for excellence by adopting one or more than one of the following approaches: For this, they design a 'strategy - culture grid', matching strategy parameters customers, competitors, and enterprises with culture parameters commitment, competence, and consistency adopting all sorts of permutations and comb inations within this matching grid.
In addition, these entrepreneurs acquire. Successful entrepreneurs clearly understand that excellent enterprises are adaptive in nature and are innovative in approach.
These entrepreneurs make it a habit to adhere to the eight attributes of excellence, viz. These eight attributes have been found as parameters of excellence by Peters and Waterman in their bestseller 'In Search of Excellence'.
Leonard L. Berry in his recently published book, Discove ring the Soul of Service, pointed out seven core values shared by the successful entrepreneurs - excellence, innovative, joy, team work, respect, integrity and social profit. Excellence they are strong profit makers, but profit is not the defining value, it is rather an outcome. Pursuit of excellence is the defining value. Innovation Innovation and excellence are inextricably linked. Changing what exists into something better is the defining value.
Joy uplifting human spirit. Bringing human potential into full flower and celebrating achievement are part of being successful. Teamwork Individuals collaboratively pooling their resources for a common purpose is the normal style for enriching quality of work life. Respect Respect for the customer.
Respect for the employee. Respect for suppliers and business partners. Respect for the community. Integrity The entrepreneur must ensure that he maintains his credibility. Integrity is just like a bank account which keeps on increasing and decreasing.
To have better integrity do small promises and keep those promises. This strengthens integrity. Social Profit Which beyond the marketing of goods and services and creating employment causes benefit to the larger community. For better quality of life in one's enterprise, the entrepreneur must stick to the four True North Principles: The four human endowments are: Self -awareness, conscience, independent will and creative imagination, and these need to be used at their optimal levels for the upliftment of the enterprise and its people.
Entrepreneurs must nurture these unique gifts by doing the following: By adhering to the True North principles, one as an entrepreneur can have a better quality of life for oneself and the people, and help one's enterprise flourish in a competitive environment. Entrepreneurs must understand that of the 7Ms of enterprise resources men, money, machines, materials, minutes, MIS, and methods "time minutes is the scarcest resource and unless it is managed, nothing else can be managed.
Fifteen time wasters revealed by a survey of entrepreneurs are arranged in three categories. Category I includes top five time wasters, viz.
Category II includes another group of five time-thieves, viz. Finally, category III encompasses other five time wasters, viz. Do the normal, sensible things first by providing marketable products, looking after management personnel and customers, and checking the ill. That is, do the obvious by getting back to the basics. Change the criteria for selecting managers and employees keeping in view of enterprise objectives.
Realize the importance of the lowest levels of the enterprise people. Take rapid decisions keeping three phrases in mind: Recognize what is needed early, then accelerate the decision making process and finally implement the decisions quickly. Soberly estimate the possibilities of streamlining and subsequently implementing the measures. Do not overlook renovation in addition to innovation.
Apply innovation to management, leadership and enterprise, as well as to products. Remember that communication as a means to an end is the key. Of course, actions and facts are more convincing than mere words.
Establish good relations with your people in the enterprise even though the ideal of peace is unlikely. Implement a new style of management and new kinds of relations with employees based on management commitment, employee empowerment, and involvement. And last, but certainly not the least, the most important single axiom for entrepreneurs is: Be credible and consistent in word and deed.
Thus a 'star' entrepreneur has the following qualities which facilitate success of his enterprise: A very good decision maker. A good leader. A consistent hard worker. Trust employees. Zealous to create wealth, more wealth and endless wealth. Good Organiser.
A good communicator. Having strong determination to achieve and succeed, and convert his cherished dreams into reality. Very simple and at a minimal level of stress. Entrepreneurship is greater when successful members of a community reinvest excess capital in the projects of other community members. Entrepreneurship flourishes in communities in which the success of other community members is celebrated rather than derided.
Entrepreneurship is greater in communities that see change as positive rather than negative. Intellectual capital, human capital, and public capital in the form of infrastructure and social norms provide even more important resources to the entrepreneur.
Entrepreneurship is a process consisting of stimulatory, support and sustaining activities. It requires to be viewed in terms of integration of activities and coordination among different departments. Promotion and development of entrepreneurship is more developmental in nature and is not administrative or target-oriented. Accumulated experience has brought maturity in approaches and strategy of developing entrepreneurship.
A set of competencies has already been identified to help people become entrepreneurs. These competencies could be developed through training intervention. Micro enterprise creation and development through micro-finance has shown a very significant result. Need for Entrepreneurship Development There is paradigm shift in economic environment from 'protectionism' to 'freedom'; from 'public' to 'private' ownership, from 'local' to 'global' market.
Highly Competitive Market in nature and global in scope. In the fast changing world the number as well as quality of entrepreneurship will determine the future course of economic development. Composition of entrepreneurs has become broad-based. They come from all types of background and own all kinds of business.
The growing awareness of the need for and urgency of building "entrepreneurs" for the attainment of accelerated and self sustained economic growth could be ascribed to two factors. The belief is gaining ground that economic growth in the advanced countries appears to be attributable to entrepreneurial awareness in the community rather than to capital. Investment in human resources has directly contributed to economic development and growth, by promoting the knowledge and application of science and technology to production process, developing innovations and research, training the workers in different technical skills needed for modern production and building up of the right type of attitude, values and interests conducive to right output.
Entrepreneurship development is an approach of developing human resources. It is concerned with the growth and development of people. This approach helps people to grow in self control, responsibility and other abilities. Entrepreneurship Development as an a pproach does not confine itself in setting up enterprises but surpasses this limit in creating conducive climate for optimum utilization of scarce and scattered resources and making people functional in all walks of life.
The movement depends on the extent of technology absorption and adaptation in small enterprises. N o n- governmental organisastions NGOs should be involved in a massive way to supplement the efforts of the government in a sustained manner to improve the living conditions of the vast rural masses through income generating enterprises. NGOs associated with these programmes have distinct advantages of being close to people in the planning and implementation of programmes.
Support from the apex development financing institutions such as needs to be mobilised for this purpose. Developing professional talent in NGOs through sustained training and follow up efforts is necessary. The tempo not only needs to be sustained and improved upon; it also needs to be reoriented to meet the challenges of the competitive environment particularly in the small enterprise sec tor.
Emerging opportunities need to be focused upon. Entrepreneurs have to keep in mind the growing complexities, and challenges of the future. The capability to rise above competition drives entrepreneurs to search for new ways of doing things, new markets to op erate, and new products to offer. In the current day context, no entrepreneur can escape competition.
In this context, successful entrepreneurial behaviour implies constant and continuous quest to be different, to perform better, and to exert more to ensur e excellence. Entrepreneurs may be able to assess their strengths and weaknesses; become capable of maximising strengths and making their weaknesses redundant. Thus, the major thrust of motivation needs to undergo change from stimulatory to sustaining and growth orientation.
Entrepreneurship development efforts need to be focussed on economically lower and less privileged population, who constitute a much wider population group. The spread of education, particularly vocational education, skill development, technological upgradation and managerial training and development of greater awareness of economic and social opportunities, apart from the creation of better infrastructural facilities in the environment in which they are placed, will enable economically weaker sections utilize entrepreneurial opportunities, relevant to their environme nt, much faster.
Self-employment programmes focussing on women, as individuals or as groups, also provide very wide range of opportunities for women to take advantage of the entrepreneurial direction. Mobilisation of women power for entrepreneurship and empowerment calls for sustained efforts over a long period to ensure that the coverage is sizeable in relation to the demand. Emphasis in future periods cannot be limited to manufacturing type of enterprises alone.
Service sector, agro and other rural micro enterprises will demand considerable attention because of the vast potential for dispersed pattern of development. Promotion of entrepreneurship in rural areas and backward regions has to be stressed to a great extent.
The entrepreneurship development institutions should gear themselves up to meet this challenge of downward vertical thrust. Institutional Framework A comprehensive institutional frame has been evolved over years for promoting entrepreneurship and for guiding existing entrepreneurs at national, regional and local levels. Organisations under the Ministry of Industry at the national level and those created at the state levels cater to all categories of entrepreneurs interested in setting up small enterprises.
Apart from Ministry of Industry, Science and Technology, human Resource Development, and other Ministries at the Centre are also involved in encouraging entrepreneurship development efforts. A whole range of support services has been created at the state level for helping existing an propsertive entrepreneurs.
Involvement of banks and other financial instutions at the spex and field level in supporting entrepreneurship among existing and prospective entrepreneurs is of a high order. Role and responsibility of technical educational institutions in innovation and entrepreneurship for creating a techno -entrepreneurial society has been. Entrepreneurship for creating a techno-entrepreneurial society has been empahsised.
Entrepreneurship training and management training institutions and other educational organisations have been playing a key role in popularising entrepreneurship as a career option and in providing the needed support to first generation entrepreneurs.
Approach Differentiation 1. Development of human factor or the entrepreneur himself. It refers to the, values, attitude, desire and motivation of individual, his capability to perceive the environmental changes and opportunities as well as his ability to solve the problem which entrepreneur is likely to face.
All these qualities differ from country to country or culture to culture and these differences are related to economic growth. Target oriented Approach: Entrepreneurship Development Programmes are directed and planned for a specific group having distinguishing features.
It is because of the fact that target audience vary in terms of their background, experiences, training and exposure to business world. The main training inputs are as follows: Once the entrepreneur selects a particular enterprise the technical aspects of the trade is essential. He needs to also know the economic aspects of the technology including costs and benefits. In order to develop human resources, development of achievement motive is essential.
The purpose of AMT is to develop the need to achieve, risk taking, initiative and other such behavioural traits. A motivational development programme creates self awareness and self confidence among the participants and enables them to think positively and realistically. The participants should be given opportunity to actually conduct market surveys for their chosen project. Once a participant is able to start the enterprise he requires managerial skills. Managerial skills are particularly essential for a small scale enterprise who cannot afford to employ specialists in different areas of management.
The aim should be to enable the participant to look at an enterprise in its totality and to develop overall managerial understanding. Alot of time needs to be devoted to the actual preparation of project. Their active involvement in this task would provide them necessary understanding and also ensure their personal commitment. This phase involves assessment to judge how far the objectives of the programme have been achieved. Monitoring and follow up reveals drawbacks in the earlier phases and suggests guidelines for framing the future policy.
In this phase infrastructural support, counseling and assistance in establishing new enterprise and in developing the existing units can also be reviewed. Some common activities in the monitoring and follow up process are as follows: Content of Training Programme: Some of the major institutions for EDPs in India are as follows: The entrepreneurship development institute of India is an apex entrepreneurship institute promoted by industrial development bank of India, Industrial credit and Investment Corporation of India, Industrial Finance Corporation of India and state bank of India.
The institute enjoys acute support of government of Gujarat. The institute has been operating for the past more than 15 years now. The institute undertakes entrepreneurship development programmes to serve the following development objectives: The main objective of the institute are explained as follows: Xavier Institute of Social Services, Ranchi has been training rural entrepreneurs since Xavier Institute provides the training and assists the trainees in drafting project proposals and obtaining the required finance.
It offers a six months programme to tribal with minimum literacy and numeracy skills. The programme consists of: Explain the Entrepreneurial Development Programme in India. This is a technical management consultancy Organization. It was promoted by all-India financial institutions and state Corporations.
It undertakes assignments for project planning, detailed engineering, market surveys, management surveys and entrepreneurship development programmes. The programme consists of the following stages: This Centre was organized as registered society by a number of prominent industrialists, businessman, bankers, professionals and social workers.
It was setup in response to rapidly increasing unemployment and social unrest in Calcutta during the early s. It began as a vocational programme to provide self employment for educated youths. It has developed innovative approaches to help people set up their own business. The main programme are explained as follows: Access to high quality consultancy services improves the operational efficiency of entrepreneurs.
All India financial institutions have set up TCOs to provide industrial consultancy and training to entrepreneurs. These organizations provide a comprehensive package of services.
In an entrepreneurial development programmes, the target group refers to the group of the persons for whom the programmes is design and undertaken. Every target group has its own needs and constraints.
Therefore, the programmes designed for one group might be 4 Madhya Pradesh Consultancy Organization Ltd.
Write a short note on Target Group. Before the programmes is designed and started the target group to be trained must be clearly defined. An executive development programmes may be organized for any one of the following target groups: The training programmes for such people may be design to enable and assist them in setting up their own manufacturing units. The industries selected for this purpose may be directly related with their qualifications and experience.
Persons who have retired from the army, navy and air force constitute an important group for entrepreneurial training. These persons have acquired many useful skills and experience during their service period. They tend to be highly disciplined, hardworking, engineering and innovative.
Therefore they can become successful entrepreneurs after proper entrepreneurial training. Some business executives want to start their own independent enterprise after getting sufficient business experience. Some of them have certain innovative ideas which they are not able to try in their existing firms due to lack of sufficient authority. Some among them are not satisfied with their present economic and social status. After entrepreneurial training senior business executives can become successful entrepreneurs.
Women are entering the business especially traditional food processing industries like spices, agarbati, papad etc. Several Governments and non- governments organizations organizing entrepreneurial training programmes for women. Government of India is committed to be upliftment of scheduled castes S. C and Scheduled Tribes S. Therefore specified percentage of jobs has been reserved for these castes.
But all persons from these groups cannot be offered employment. Government agencies give preference to S. C and S. T entrepreneurs in providing finance and other necessary facilities. The government of India has been established specialized agencies for training entrepreneurs. Special schemes have also been launched to train, develop and assist entrepreneurs. The government of India for the first time tabled the new small enterprise policy in titled 'Policy Measures for Promoting and Strengthening and Supplementing Small, Tiny and Village Enterprise, in Parliament on August 6, The main thrust of the new small 1.
Technical and other qualified Persons: Ex- Serviceman: Business Executives: Women Entrepreneurs: T Entrepreneurs: Special agencies and Schemes: Government Policy: The sector had been substantially licensed and concerted efforts were made to regulate and debureaucratize the sector with a view to remove all fetters on its growth potential on the one hand and reposing greater faith in small and new enterprises on the other.
Increasing in the investment limit in plant and machinery of tiny enterprises from Rs. Inclusion of industry related service and business enterprises, irrespective of their location as small-scale industries.
To introduce a limited partnership act. This would limit the financial liability of the new enterprises to the capital invested. Introduction of a scheme of integrated infrastructural development for small-scale industries. Introduction of factoring services to help solve the problems of delayed payments of small-scale sector. To set up a Technology Development Cell in the small industries development organization.
To accord priority to small and tiny sector ion the allocation of indigenous raw materials. Setting up of an Export Development Center in the small industries development organization.
To widen the scope of the National Equity Fund NEF to enlarge the single window scheme and also to associate commercial banks with provision of composite loans. The new policy was founded on a proper understanding of the fundamental problems of the small-scale sector and the measures proposed by it have integrated the various handicaps that face this sector. These make them sensitive. In fact, small business in such a sensitive field where Murphy's Law if anything can go wrong, it will seems to operate without fail.
The first thousand days seems to be as critical in small business as in administration. The former needs support and the latter indoctrination for survival. In the beginning, small industries have to incur more expenses, but the returns are either The salient features of the price policy were: Taxation Benefits: If this becomes uncontrollable, the unit may fall sick and needs rehabilitation before it is actually anticipated.
Therefore, they need to be provided support and assistance to tide over the crucial initial stages to enable them to survive. Hence, the government needs to come forward with various benefits to offer to small- scale industries in the country. One way to support the development of small-scale industries by the government is to provide them tax benefits.
The government either exempts them from tax or provides concession in tax liability. This helps small industries accumulate capital, on the one hand, and plough back profits in business, on the other. The various tax benefits available to small-scale industries are now enumerated and discussed one by one. This exemption in tax is allowed for the period of five years from the commencement of production.
A small-scale industry has to satisfy the following two conditions to avail of this tax exemption facility; i The unit should not have been formed by the splitting or reconstitution of an existing unit.
Under section 32 of the Income TaxAct, , a small-scale industry is entitled to a deduction on depreciation on block of assets at the prescribed rate. In the case of the small-scale industry, deduction from the actual cost of plant and machinery is allowed subject to a maximum of rupees 20 Lakhs. The amount of depreciation is calculated by the diminishing balance method. In case of an asset acquired before the accounting period, depreciation is calculated on its written down value.
For plant and machinery that are used in manufacturing in double or triple shift, an additional allowance called 'Extra Shift Allowance' is available. A small-scale industry should satisfy the following conditions before it becomes eligible for deduction in depreciation: A rehabilitation allowance is granted to small-scale industries under section B of the Income-Tax Act, The allowance is give to those small businesses that had to suffer on account of the following reasons: The rehabilitation allowance should be used for the business purposes within three years of the unit's re-establishment reconstruction of revival.
The investment allowance was introduced way back in to replace the initial depreciation allowance. Although the investment allowance has been made available for the article or things except certain items of low priority, yet, as per the 11th schedule to the Income Tax Act , a special dispensation has been provided for the plant and machinery installed in small-scale industries.
In comparison with other industries are at an advantage in claiming a deduction of investment allowance. A small-scale industry can avail of investment allowance provided it has put to use machinery or plant either in the year of installation or in the immediate following year, falling which the benefit will be forfeited. Under the section 35 of the Income Tax Act , the following deductions in respect of expenditure on scientific research are allowed: It is easy to start small enterprises but difficult to make them survive.
It is more so in the context of ever increasing competition in business brought about by liberalization, globalization and privatization of the Indian economy. The small businesses generally lose out on this platform. Only those enterprises can survive that possess enough strength to face the stiff and complex competition. Further, small enterprises find it more difficult to face competencies, etc, and become weaker.
The question then arises-how to develop competitive strength among small enterprises to meet competition effectively? The answer to this question is 'quality'. In aggregate, TQM can help strengthening of small enterprises in the following manner: A quality certification scheme was launched in to improve the quality standards of SSI products which are to be assisted by awareness programmes and financial support to acquired ISO or similar international quality standards.
Various entrepreneurial inputs influencing the entrepreneurship are as follows: Economic environment exercises the most direct and immediate influence on entrepreneurship. The economic factors that affect the growth of entrepreneurship are the following: Capital is one of the most important perquisites to establish an enterprise.
Availability of capital facilitates for the entrepreneur to bring together the land of one, machine of another and raw material of yet another to combine them to produce goods. Capital is therefore, regarded as lubricant to the process of production. Our accumulated experience suggests that with an increase in capital investment, capital- output ratio also tends to increase. This results in increase in profit which ultimately goes to capital formation. This suggests that as capital supply increases, entrepreneurship also increases.
The quality rather quantity of labour is another factor which influences the emergence of entrepreneurship. Most less developed countries are labour rich nations owing to a dense and even increasing population. But entrepreneurship is encouraged if there is a mobile and flexible labour force. And, the potential advantages of low-cost labour are regulated by the deleterious effects of labour immobility.
The considerations of economic and emotional security inhibit labour mobility. Entrepreneurs, therefore often find difficulty to secure sufficient labour.
The necessity of raw materials hardly needs any emphasis for establishing any industrial activity and its influence in the emergence of Q. Write a note on Entrepreneurial Input. Entrepreneurial Input: A Economic Inputs: In the absence of raw materials, neither any enterprise can be established nor can an entrepreneur be emerged. Of course, in some cases, technological innovation can compensate for raw material inadequacies.
The fact remains that the potential of the market constitute the major determinant of probable rewards from entrepreneurial function. Frankly speaking, if the proof of pudding lies in eating, the proof of all function lies in consumption, i.
The size and composition of market both influence entrepreneurship in their own ways. Practically, monopoly in a particular product in a market becomes more influential for entrepreneurship than a competitive market. Expansion of entrepreneurship presupposes properly developed communication and transportation facilities. It not only helps to enlarge the market, but expend the horizons of business too. Take for instance, the establishment of post and telegraph system and construction of roads and highway in India.
Social factors can go a long way in encouraging entrepreneurship. In fact it was the highly helpful society that made the industrial revolution a glorious success in Europe. The main components of social environment are as follows: There are certain cultural practices and values in every society which influence the actions of individuals. These practices and value have evolved over hundred of years.
For example, consider the caste system the varna system among the Hindus in India. It has divided the population on the basis of caste into four divisions: By 'social mobility' we mean the freedom to move from one caste to another.
The caste system does not permit an individual who is born a Shudra to move to a higher caste. This facto includes size of family, type of family and economic status of family. In a study by Hadimani, it has been revealed that Zamindar family helped to gain access to political power and exhibit higher level of entrepreneurship.
Backgroud of a family in manufacturing provided a source of industrial entrepreneurship. Occupational and social status of the family influenced mobility. Education enables one to understand the outside world and equips him with the basic knowledge and skills to deal with day-to-day problems.
In any society, the system of education has a significant role to play in inculcating entrepreneurial values. B Social Inputs: C Psychological Inputs: Arelated aspect to these is the attitude of the society towards entrepreneurship. Certain societies encourage innovations and novelties, and thus approve entrepreneurs' actions and rewards like profits.
Certain others do not tolerate changes and in such circumstances, entrepreneurship cannot take root and grow. Similarly, some societies have an inherent dislike for any money-making activity. Motives impel men to action. Entrepreneurial growth requires proper motives like profit-making, acquisition of prestige and attainment of social status.
Ambitious and talented men would take risks and innovate if these motives are strong.
The strength of these motives depends upon the culture of the society. If the culture is economically or monetarily oriented, entrepreneurship would be applauded and praised, wealth accumulation as a way of life would be appreciated. Many entrepreneurial theorists have propounded theories of entrepreneurship that concentrate especially upon psychological factors. These are as follows: The most important psychological theories of entrepreneurship were put forward in the early s by David McClelland.
According to McClelland 'need achievement' is social motive to excel that tends to characterize successful entrepreneurs, especially when reinforced by cultural factors. He found that certain kinds of people, especially those who became entrepreneurs, had this characteristic. Moreover, some societies tend to reproduce a larger percentage of people with high 'need achievement' than other societies.
McClelland attributed this to sociological factors. Differences among societies and individuals accounted for 'need achievement' being greater in some societies and less in certain others. There are several other researchers who have tried to understand the psychological roots of entrepreneurship. One such individual is Everett Hagen who stresses the psychological consequences of social change. Hagen says, at some point many social groups experience a radical loss of status. Hagen attributed the withdrawal of status respect of a group to the genesis of entrepreneurship.
He postulates that four types of events can produce status withdrawal: He further postulates that withdrawal of status respect would give rise to four possible reactions and create four difference personality types: He who adopts a kind of defensive behavior and acts in the way accepted and approved in his society but no hopes of improving his position; He is a person who foments a rebellion and attempts to establish a new society; and He is a creative individual and is likely to be an entrepreneur.
Other psychological theories of entrepreneurship stress the motives or goals of the entrepreneurs. Cole is the opinion that besides wealth, entrepreneurs seek power, prestige, security and service to society.
Stepanek points particularly to non-monetary aspects such as independence, person's self-esteem, power and regard of the society. On the same subject, Evans distinguishes motive by three kinds of entrepreneurs.
Thomas Begley and David P. Boyd studied in details the psychological roots of entrepreneurship in the mid s. They came to the conclusion that entrepreneurial attitudes based on psychological consideration have five dimensions: This is nothing but "a chronic, incessant struggle to achieve more and more ion less and less of time" Entrepreneurs are characterizing by the presence of 'TypeA' behavior in all their endeavors.
Explain that key to entrepreneurial behaviour is entreprenurial motivation. Behavior, in turn is influenced by the way in which the external world is represented in the mind, and by the individual's exercise of choice. According to this theory an individuals need for achievement refers to the need for personal accomplishment.
It is the drive to excel , to strive for success and to achieve in relation to a set of standards. People with high achievement motive like to take calculated risk and want to win. They like to take personal responsibility for solving problems and want to know how well they are doing.
High achievers are not motivated by money. Such people strive for personal achievement rather than the rewards of success. They want to do something better and more more efficiently than it has done before.
This drive is the achievement need n-ach. From the researches into the area of achievement need McCelland found that high achievers differtiate themselves from others by their desire to do things better.
They seek situations where they can attain personal responsibility for finding solutions to problems , where they can receive rapid feedback on their performance so they can set moderately challenging goals. High achievers are not gamblers, they dislike succeeding by chance.
They prefer the challenge of working at a problem and accepting the personal responsibility for success or failure, rather than leaving the outcome to chance or the actions of others. Need for achievement through self study, goal setting and interpersonal support 2.
Keen interest in situations involving moderate risk. Desire for taking personal responsibility. Concrete measures of task performance. Anticipation of future possibilities. Energetic or novel instrumental activity. Organisational skill Closely related to the concept of a high need for achievement is the belief in an internal locus of control. Rotter believed that the need for achievement is related to the belief of internal locus of control.
People with an internal locus of control are those individuals who also believe themselves to be in control of their destiny Chell, and colleagues, In contrast, people with an external locus of control sense that fate, in the form of chance events outside their control, or powerful people, has a dominating influence over their lives Chell and Colleagues, Rotter hypothesized that individuals with internal beliefs would more likely strive for achievement than would individuals with external beliefs.
Risk bearing is a prime factor in the entrepreneurial character and function. In particular, Hull and colleagues found that the personality characteristics most important in identifying entrepreneurial types of individuals are 1 functional task preference and 2 personality constructs of creativity, risk and flexibility. Researchers such as Palmer , as cited in Kent and Sexton, and Likes , as cited in Shabbir and Gregorio, speculate that in becoming an entrepreneur, an individual risks financial well-being, career opportunities, family relatives and psychic well being.
The level of uncertainty involved in an entrepreneurial venture indicates that individuals drawn to such lines of business will possess a certain level of risk taking propensity.
Any consideration of personality characteristics of the entrepreneur must entail restriction of inheritance to a limited class of descendants for at least several generations. The object of entail is to preserve large estates in land from the disintegration that is caused by equal inheritance by all the heirs and by the ordinary an examination of their value systems. Value orientation- the principles of right and wrong that are accepted by an individual or a social group; "the Puritan ethic"; "a person with old-fashioned values" ethic, moral principle, value-system 2.
One of the major studies of personal values of entrepreneurs was done by Hornaday and Aboud , as cited by Sexton and Smilor, The researchers found that entrepreneurs scored significantly higher than the general population reflecting the need for achievement, Thus it is concluded that values may be effective in distinguishing successful entrepreneurs from the general population.
Gartner refers to innovation as the central value of the entrepreneurial behavior, since it is successfully taking an idea or invention to market. Innovation and problem solving capabilities are expected to be the core of the entrepreneurial capability of an entrepreneur.
But the level of innovation is dependent upon the entrepreneur's formal education and managerial experience. Their study of firms in the Midwest showed a correlation between a higher level of managerial experience and more years of education with a higher level of innovation David McCelland has developed an Achievement Motivation Theory in the early Discuss that n- achievement theory of motivation is the key to management success.
The following psychological factors contribute entrepreneurial motivation: Organisational skill The researchers have criticized McClelland's achievement motivation theory of entrepreneurs over the last three decadOes. Most notably, Brockhaus , as cited in Sexton and Smilor, questioned the predictive power. The predictive power of a scientific theory refers to its ability to generate testable predictions. Theories with strong predictive power are highly valued, because the predictions can often encourage the falsification of the theory.
The author has pointed out that McClelland's empirical research did not directly connect need for achievement with the decision to own and manage a business. Other criticisms of McClelland's achievement motivation theory on entrepreneurs look at the attempt to relate economic development to the prevalence of achievement imagery Chell, Haworth and Brearley, The cultural basis of the achievement is motive.
In some cultures, failure is seen as a positive learning experience, while in others it has a certain negative stigma There is however some empirical support for the idea that entrepreneurs have a higher motive to achieve compared to non-entrepreneurs. Begley and Hornaday and Aboud consistently found that the achievement motivation exists as a stable characteristic and is more prevalent among entrepreneurs when compared to others.
The traditional approach to rural development was 'top-down' meaning that central development authorities designed programmes which brought in infrastructure, human capital and investment from outside the rural community. While the investment in infrastructure and extension services was clearly beneficial in attracting basic commercial activities and increasing the quality of life in rural areas, it did not necessarily provide a long term growing economic base.
Many rural areas were not beneficiaries of such schemes, since many projects were too expensive to implement in all rural areas. The new approach which emerged over the past decade is the development 'from below'. It stressed the importance of community development based on local entrepreneurial initiatives, with the explicit goal to ensure balanced technological development of rural areas which would offer adequate employment opportunities and a quality of life comparable to urban areas.
This approach assumes that the development of rural areas is based on stimulating local entrepreneurial talent and subsequent growth of indigenous companies. Specifically, to accelerate economic development in a rural area, it is necessary to increase the supply of entrepreneurs that is to build up the critical mass of first generation entrepreneurs who will take risks and accept the uncertainties of new Q.
Explain the concept of entrepreneurial success in rural area in detail. To support such development, the community must develop links among key institutions, a vibrant entrepreneurial spirit and a commitment and dedication to risk taking and risk sharing.
One of the principal challenges of economic development of rural areas is the development of a socio-economic environment that would be attractive to people. To meet this challenge, all available and hidden development potential of the local community must be mobilised. This in turn requires an environment favourable to entrepreneurship which a community basically can create in two ways. First, the community should utilise all the available incentives provided by the government to stimulate the development of economically depressed areas.
These incentives usually include favourable investment conditions, low interest rates, tax concessions, guarantees, export subsidies, employment provisions, subsidies on public utility charges and the like. Second, the community should create and foster the development of institutions and a variety of partnerships to support local development.
As experience shows, personal and organizational networks are very effective in achieving broad and fast growing regional economic development. Among the most important are: The role of institutions of education in rural development is of crucial importance. They help to create a capable labour force and to maintain a skilled work force in the community. In rural areas they can act as agents of change, such as: Efforts to support and enhance existing businesses within a community and to promote new enterprises in a community can be most successfully earned out through different inter-firm institutions.
Among different inter-firm institutions, business incubators, industrials parks, different non-profit seeking organizations facilitating networking and business support centres are one of the most successful ones promoting the growth of new and existing enterprises.
These institutions can significantly contribute to rural development because of the following: Business incubators are a facility designed to assist the development of new enterprises Smilor, R. They help entrepreneurs by providing them with services which support and compliment their own talents and abilities.
Their support system usually includes secretarial, administrative and business expertise and facilities which are available to entrepreneurs below or at market rates. The entrepreneurs receive not only help regarding the management of their enterprises but also other services such as provision of financial assistance and training. They organize conferences, business luncheons and different types of activities for the purpose of networking. They create a good business climate inside the incubator and ensure a constant inflow of moral and financial support.
As such, they thus seek to give form and substance, structure and credibility to emerging ventures. The business incubator presents a rather unique approach to economic development.
Unique in the sense that it is an independent enterprise whose business is the process of 'incubating' enterprises. The business incubator has emerged as a solution to the high failure rates among new firms. Many new firms fail, not because they are not innovative enough but because in their early stage they have difficulty in competing.
Therefore, the basic concept of the incubator is to nurture entrepreneurial activities so as to provide start- ups with the necessary services and support until they mature and are ready to enter successfully into the competitive business environment. The business incubator industry was one of the fastest growing industries in the late eighties in the U.
Nearly every regional development programme includes the development of the incubator network, especially in those regions which had experienced economic decline and severe job losses due to the closing down of industries. Initially, practically all incubators in the U.
Inter-firm Institutions Business Incubators Incubators in a rural area can be designed for a number of purposes to: Business incubators are usually established by private initiative with the financial assistance from the federal, state and local governments and private sector contributions. Communities could increase the attractiveness of industrial parks to potential entrepreneurs by delivering conventional common infrastructural services, by customisable layouts that could be rearranged over time to meet user needs in a flexible way and by the final price which should be much lower than the price of equivalent buildings in other, especially urban, areas.
Networking among firms in the industrial park is a common outcome.
The firms in the industrial park benefit in several ways through networking. The benefits could be grouped into those resulting from reducing the problems of isolation in the process of starting-up, those resulting from economies of scale as overhead functions among firms in the network are shared and those due to the aggregation of production of small firms with the same or compatible production and due to large scale purchases of equipment and raw material.
These are non-profit seeking associations, registered or non-registered which facilitate networking between small firms located in the same region2. They usually perform the following tasks: Networking among small firms permits aggregation of production, large scale purchases, enables specialised firms jointly to manufacture finished products, facilitates shifts from product to product and market to market and leads to important economies of scale as overhead functions are shared Hatch, , p.
Business support centres can be established to meet the needs of start-ups, emerging or established businesses. They provide different types of services according to the needs of the three different clients Small BusinessAdministration, p. Business support centres can be part of the local government or semi private institutions or for non-profit private organizations.
They can also be established at the community colleges or at the university to help small business owners learn necessary business skills at low cost. Communities should support the development of a strong venture capital base and risk capital networks specialising in funding new entrepreneurial activities.
Seed financing could be an important bottleneck for new enterprise creation. For this reason, special attention must be given to the creation of institutions that provide seed financing and start- ups targeted venture capital and are engaged in equity financing.
If it would be difficult for such institutions to be attractive to a rural community, the community leadership must encourage existing institutions to link new start-ups or potential entrepreneurs with such institutions outside the community. They should also be responsible for screening all financial schemes existing in the country for the development of new enterprises and for the growth of existing ones.
Potential entrepreneurs must have access to information such as: What type and how many economic development funds are available?
Who provides favourable investment financing for the equipment and working capital? Which development corporations finance new and expanding businesses'? What state funds are available for small and medium sized enterprise development, etc.
The impact of institutions discussed earlier on rural economic development will increase if the individual efforts of those institutions are combined into a co-ordinated action. Therefore, the task of community leadership is to encourage close co-operation among different institutions supporting rural development, both public and private, in order to develop programmes that would address the key barriers to community development: The key to the evolution of economic development based on a partnership approach is the leadership that could come either from the local government or from already existing successful private companies, local development private or public agencies, community civic organizations, educational institutions and the like.
What is crucial is the development of personal and organizational networks which combine otherwise individual efforts into a comprehensive approach to regional development of rural areas.
Therefore, it is important to identify or to establish the principal community civic agency, the lead organization responsible for designing and carrying out the development strategy based upon identification of an area's major problems lack of job opportunities, substandard housing, deteriorated social infrastructure, etc.
This organization should act as a planning and brokering organization, bringing together public and private initiative to attain common community goals. It should support the creation of new agencies if ongoing implementation of a development strategy so requires. Personnel should also include representatives of the major enterprises in the region, universities and research and development institutions.
It should focus on broad community concerns and co-ordination of separate efforts in the region. Economic development in general requires more than just a proper macro economic environment.
In addition it demands institutional framework conducive to economic development, practical mechanisms for risk taking and risk sharing in the early and most uncertain stages of entrepreneurial ventures and an organizational system conducive to growing new and existing businesses.
It takes cross-institutional networking. The role of public policy is therefore to continually find ways to implement critical success factors of economic development. Economic development of rural areas cannot be an exception in this respect. How an entrepreneurial system can be established? Search for Bbusiness Ideas: Sources of Ideas: Study of Projects Profiles: An entrepreneur perceives an opportunities for marketing a product or services. Finally he manages his enterprise expanding, growing or diversifying over a period of time.
In order to establish an entrepreneurial system an entrepreneur needs to take the following steps: The idea may originate from various sources e. The idea may relate to the starting of a new business or to takeover of an existing enterprise, the idea should be sound and workable, so that it may be exploited. Abusiness idea may be discovered from the following sources: Market surveys can also reveal the demand and supply position for various products. It is necessary to estimate future demand and to take into account anticipated changes in fashions, income levels, technology etc.
From the data collected through market observation, one can identify the products industries which are in demand and which require increase in supply. Apromoter can then find out the most profitable line of business. These days good business firms generally conduct a survey among prospective consumers before choosing the product to be manufactured. People in underdeveloped countries generally follow the fashion trends of developed countries for example video, washing machines, micro ovens etc.
Therefore, an entrepreneur can discover good business idea by keeping in touch with developments in advanced nations. Various government and private agencies publish periodic profiles of various projects and industries.
These profiles describe in detail the technical, financial and market requirement and prevailing position a careful scrutiny of such project profiles is very helpful in choosing the line of business. Several government organizations now-a-days assist entrepreneurs in discovering and evaluating business ideas. Government also identifies the priority sectors for investment through five year plans, industrial policy resolution guidelines for industry.
National and international trade fairs are a very good source of business ideas. Trade fairs and exhibitions provide opportunities for assessing the market trends in terms of demand potential and type of products required. It also assessing the attitude of the competitors in a particular product or marketing area.
Once business ideas are discovered, screening and testing of these ideas is done. The following considerations are significantly in the evaluation and testing of business ideas. It refers to the possibility of producing the product. Technical feasibility of an idea is judged in terms of availability of necessary technology, machinery and equipment, labour skills and saw materials. The advice and assistance of technical experts may be necessary to judge the technical feasibility of various business ideas.
A cost benefit analysis is required to ascertain the profitability if the ideas. An elaborate study of market conditions and prevailing situation is made to assess the viability and prospectus of the proposed projects. Anumber of calculations have to made about the likely demand, expected sales volume, selling price, cost of production, break even point etc.
After preliminary evaluation of the idea, the promising idea is subjected to a thorough analysis from all angles. Full investigation is carried out in the technical feasibility and economic viability of the proposed project. Financial and managerial feasibility of the idea are tested. At this stage a lot of information is required. Consultations with experts in various areas of the industry may be necessary to carry out the detailed analysis.
This report helps in the final selection of project. It is also useful for procuring licenses, finance etc from governmental agencies. The feasibility report is analyzed to finally choose the most promising idea. Generally the following considerations influence the selection of idea for a product or service: Process the Ideas: Technical Feasibility: Commercial Viability: After considering the various factors a entrepreneur should analysis and compare pros and cons.
A selection matrix may be prepared for this purpose. The matrix indicates the type of diverse data that needs to be collected for each project. It also throws light on how each item can hold out some encouraging and some discouraging factors. The entrepreneurial selection needs to take all these factors into account.
Once the promoter is convinced of the feasibility and profitability of the project he assembles the necessary resources to launch the enterprise. Decisions have to be made about the size, location, layout etc. The form of ownership organization has to be selected. The main inputs required for launching an enterprise are as follows: An entrepreneur requires relevant data on the following aspects: Volume and source of supply.