Professional Documents
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ENTREPRENEURSHIP
ORIGIN:-
The term ‘entrepreneur first of all appeared in the French Language. In
the early 16th century it was applied to a person engaged in military
expedition. To was extended to cover the construction and civil engineering
activities in the 17th century. It was the only in the 18th century that the
word was used to refer to economic activities. Richard Cantillon, a French
banker applied the word entrepreneur to mean a person who bears
uncertainty and risk ’
Introduction
Economic development essentially means a process of upward
change. It can be defined as a process of a upward change. It can be define
as a process whereby the real per capita income of the country increases
over a long period of time.
Concept
Entrepreneurship is the tendency of a person to organize the business of
his own and it run a profitably, using the quality of leadership, decisions
making and managerial caliber etc. The term entrepreneurship is often used
interchangeably with entrepreneurship. But conceptually they are different
ENTREPRENEUR
ENTREPRENEURSHIP
Refer to a person
Refer to a process
Creators
Creation
Organizer
Organization
Decision Maker
Decision making
Initiator
Initiative
CHARACTERISTICS OF ENTREPRENEURSHIP
ENTREPRENEURIAL
PERSONALITY
ENTREPRENEURIA
ORGANISATION
ENTREPRENEURSHIP L
AL CONTEXT
TASK
ENTREPRENEURIAL
ENVIRONMENT
2)According to motivation:
• Man entrepreneur
• Woman entrepreneur
• Young entrepreneur
• Old entrepreneur
• Middle –aged entrepreneur
• Urban entrepreneur
• Rural entrepreneur
8)According to scale
A) ECONOMIC ORIGIN
B) SOCIO ORIGIN
FACILITATING FACTORS
BARRIERS
1 Technical knowledge
Lack of Technical skills
2 Entrepreneurial training
Lack of market knowledge
3 Market Contacts
Lack of seed capital
4 Family business
Lack of business knowledge
5 Availability of capital
Social stigma
9 supplier assistance
Political instability
other
institutions
MOTIVATION
Entrepreneurial behavior is the result of entrepreneurial motivation.
Motivation refer to the inner urge that ignites and sustain behavior to satisfy
need. Motivation has been derived from the word ‘motive’ which implies the
inner state of mind that activates provokes and direct our behavior toward
the goal.
MEANING OF MOTIVATION
Motivation implies an inner state that cause a person to act toward the
attainment of goals. It is an inspirational process of steering an individual’s
inner drive and action toward goals. It causes a chain reaction. Motivation
can be both positive and negative. Positive occurs when a person is inspired
to act for earning some rewards and benefits. On the other hand negative
motivation arises from fear or failure or frustration. It causes a person to
seek protection.
FACTORS OF MOTIVATION
Notes By: Guljinder Randhawa 21
Several studies have been undertaken to identify the factor that motivate
people to sart their enterprises. P.N .Sharma has identified nine motivating
factors which are as under.
1. Internal Factors
• Educational Background
• Occupational Experience
• Desire to work.
• Desire to branch out manufacturing.
• Family background.
2. External Factors
• Assistance from government.
• Assistance from financial institution.
• Availability of technology/ raw material
• Other factors demand of a particular product, utilization of excess
money earned from contractual estate business, started
manufacturing to facilitate trading distribution system, government
policies and many other factors.
The Internal factors constitute the personality of the entrepreneur and
there by generate an inclination to adopt entrepreneurial activity. The
presence of these factors is essential for the entrepreneurial activity to take
place. The presence of internal factors is necessary condition for the
entrepreneurial activity to take place. But the entrepreneurial idea cannot
fructify or take real shape without a proper or conducive environment which
provides support in terms of financial assistance, technology and raw
material and infrastructural facilities. Among the internal motivation , the
desire to do something creative was important. According to the stidy of
P.N.Sharma revealed occupational experience as the most significant
internal motivating factor. This experience was accumulated by the
entrepreneurs either as a business executive in industrial concern or as a
trader, consultant in the related field.
Technically and professionally qualified entrepreneur had establish an
enterprises in the field of their specialization which amply proves that they
He argue that people with high need for achievement possess the
following attributes:
Prefer personal responsibility for decision.
Are moderate risk taker.
Possess interest in concrete knowledge of the result of decisions.
ESTABLISHMENT OF ENTREPRENEURIAL
SYSTEMS
An entrepreneur, after making appraisal of the resources at his
command, perceives a business opportunity for producing and marketing a
product or services. After establishing an enterprises an entrepreneur is
required to look after the operation of this enterprises over a period of time.
An entrepreneur is expected to undertaken the following steps in his pursuit
of setting up an enterprise
All the above stated function is important but the function regarding
finance, manpower and marketing, demands more attention of
entrepreneur.
B. Management and control: SSI is normally a one man show and even in
case of partnership the activities are mainly carried out by the active
partner and the rest are generally sleeping partners
C. Gestation period: Gestation period is that period after which teething
problem are over and return on investment starts.
D. Area of operation. The area of operation of SSI generally localized
catering to the local or regional demand. The overall resources at the
disposal of a SSI are limited and as result of this, it is forced to confirm
its activity to the local level.
E) Other Problem
• Technological changes
• Land and building
• Infrastructural facilities
• Faculty planning
• License system
• Managerial inadequacies
• Analysis of business environment
• Machinery and other equipment
• Lack of technological upgradation
F . Designing financing scheme: After deciding about the location the next
important consideration is financing. An entrepreneur is to properly
assess his financial requirement and take necessary steps for raising
the requisite financial resources. An entrepreneur can depend on
various sources for financing his enterprises and these are:
• Own funds.
• Borrowing from the friends and relatives.
• Loan from the commercial banks for the working capital.
• Term loans from the financial institution and state Finance
Corporation.
There are many hurdles in financing small scale units and risk involved is
more because of the following factors
• Limited managerial expertise.
• More vulnerability to business environmental pressure
• Insufficient collateral to comply with the term and conditions of
lending institution.
• Organizational constraints.
• Limited saving.
9. Registration: The next step is to get the unit registered with the
department of industries on provisional basis. The provisional
registration can be issued to the entrepreneur to:
• Apply for shed in industrial estate.
• Apply for corporation , municipal or other local authorities fpr
permission to construct the shed for establishing the unit.
• Apply for power connection.
• Apply to SSIS for procuring machinery on hire purchases basis.
• Obtain sales tax, excise registration etc.
• Apply for telephone connection.
• Import license for capital good/ raw material.