Module-1 Entrepreneurship Development

ENTREPRENEURSHIP DEVELOPMENT

Concept of Entrepreneurship

The term entrepreneur comes from the French and translates "between-taker" or "go-between."

The concept of entrepreneurship from a personal perspective has been explored in this century. This
exploration is reflected in the following three definitions of an entrepreneur:
In almost all definitions of entrepreneurship, there is agreement that we are talking about a kind of
behavior that includes:
1. Initiative taking
2. The organizing and reorganizing or social/economic mechanisms to turn resources and
situations to practical account.
3. The acceptance of risk or failure.
To an economist, an entrepreneur is one who brings resources, labor, materials, and other assets into
combinations that make their value greater than before, and one who introduces changes, innovations,
and a new order. To a psychologist, such a person is typically driven by certain forces- the need to
obtain something, to experiment, to accomplish or perhaps to escape the authority of others.
Entrepreneurship is the dynamic process of creating incremental wealth. Our definition of
entrepreneurship involves four aspects:
1. Entrepreneurship involves the creation process.
2. It requires the devotion of the necessary time and effort.
3. It involves assuming the necessary risks.
4. The rewards of being an entrepreneur are independence, personal satisfaction, and monetary
reward. For the person who actually starts his or her own business there is a high failure rate
due to poor sales, intense competition, lack of capital or lack of managerial ability.
"Entrepreneurship involves bringing about change to achieve some benefit. This benefit
may be financial but it also involves the satisfaction of knowing you have changed something for
the better.
"Entrepreneurship is essentially the act of creation requiring the ability to recognize an
opportunity, shape a goal, and take advantage of a situation. Entrepreneurs plan, persuade, raise
resources, and give birth to new ventures."
Some facts about entrepreneurs and entrepreneurship:

E: xamine needs, wants, and problems to see how they can improve the way needs and wants are
met and problems overcome.
N: arrow the possible opportunities to one specific "best" opportunity.
T: hink of innovative ideas and narrow them to the "best" idea.
R: esearch the opportunity and idea thoroughly.
E: nlist the best sources of advice and assistance that they can find.
P: lan their ventures and look for possible problems that might arise.
R: ank the risks and the possible rewards.
E: valuate the risks and possible rewards and make their decision to act or not to act.
N: ever hang on to an idea, no matter how much they may love it, if research shows it won't work.
E: mploy the resources necessary for the venture to succeed.
U: nderstand that they will have to work long and hard to make their venture succeed.
R: ealize a sense of accomplishment from their successful ventures and learn from their failures
to help them achieve success in the future.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

An entrepreneur is a person who has possession of a new enterprise, venture or idea, and
assumes significant accountability for the inherent risks and the outcome. He or she is an ambitious
leader who combines land, labor, and capital to often create and market new goods or services.
An entrepreneur is a person who has possession of a new enterprise, venture or idea and
assumes significant accountability for the inherent risks and the outcome.
An individual who, rather than working as an employee, runs a small business and assumes all
the risk and reward of a given business venture, idea, or good or service offered for sale. The
entrepreneur is commonly seen as a business leader and innovator of new ideas and business
processes.
Entrepreneurs play a key role in any economy. These are the people who have the skills and
initiative necessary to take good new ideas to market and make the right decisions to make the idea
profitable. The reward for the risks taken is the potential economic profits the entrepreneur could
earn.
MEANING AND DEFINITION OF ENTREPRENEUR
An entrepreneur is ordinarily called a businessman. He is a person who combines capital and
labour for the purpose of production. He organizes and manages a business unit assuming the risk for
profit. He is the artist of the business world.
In the words of J.B. Say, An entrepreneur is one who brings together the factors of production
and combines them into a product. He made a clear distinction between a capitalist and an
entrepreneur. Capitalist is only a financier. Entrepreneur is the coordinator and organizer of a business
enterprise.
Joseph A Schumpeter defines an entrepreneur as one who innovates, raises money,
assembles inputs and sets the organization going with the ability to identify them and opportunities,
which others are not able to fulfill such economic opportunities. He further said, An entrepreneur is
an innovator playing the role of a dynamic businessman adding material growth to economic
development.
The words entrepreneur, intrapreneur and entrepreneurship have acquired special significance
in the context of economic growth in a rapidly changing socio-economic and socio-cultural climates,
particularly in industry, both in developed and developing countries. Entrepreneurial development is a
complex phenomenon. Productive activity undertaken by him and constant endeavor to sustain and
improve it are the outward expression of this process of development of his personality.
WHO IS AN ENTREPRENUER
He is a person who develops and owns his own enterprise
He is a moderate risk taker and works under uncertainty for achieving the goal.
He is innovative
He peruses the deviant pursuits
Reflects strong urge to be independent.
Persistently tries to do something better.
Dissatisfied with routine activities.
Prepared to withstand the hard life.
Determined but patient
Exhibits sense of leadership
Also exhibits sense of competitiveness
Takes personals responsibility
Oriented towards the future.
Tends to persist in the face to adversity
Convert a situation into opportunity.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

Qualities of Entrepreneurship
Risk Taking: - Entrepreneurs are moderate risk takers. They enjoy he excitement of a challenge, but
they do not gamble. Entrepreneurs avoid low- risk situations because there is a lack of challenge. They
avoid high risk situations because they want to succeed. They like achievable challenges. They do not
tend to like situations where the outcome of a quest depends upon a chance and not on their efforts.
They like to influence the outcome of their quest by putting in more efforts and then experiencing a
sense of accomplishment. A risk situation occurs when an entrepreneur is required to make a choice
between two or more alternatives whose potential outcomes are not known and must be evaluated in
advance, with limited information.

Self- Confidence: - A man with self confidence has clear thoughts and well- defined goals to
achieve in his life. An entrepreneur gets into business or industry with a high level of self- confidence.
He is able to evaluate his competencies and capabilities in a realistic manner. He can set realistic and
challenging goals. He is confident of achieving these goals. He possesses a sense of effectiveness,
which ultimately contributes to success of his venture. He puts forward his case confidently and gets
needed help from concerned agencies/ authorities.

Optimist: - An entrepreneur is able to visualize the hidden opportunities in the environment and
translate them into business realities. An entrepreneur exhibits a positive and optimistic attitude
towards such opportunities. The entrepreneur approaches his task with the hope of success and not
with a fear of failure. In the process of accomplishing his task he may also fail but the failure
experience does not change his thinking. He is always an optimist in his outlook. The positive outlook
develops a drive in the entrepreneur to attempt new things and innovate.

Need for achievement: - The need to excel known as achievement is a critical factor in the
personality of an entrepreneur. People with high need for achievement have desire for success in
competition with others or with a self- imposed standard of excellence. They try to accomplish
something new and try to innovate themselves in long term goals. They try to accomplish challenging
tasks. They know their own strengths and weaknesses, the facilitating factors and constraints in the
environment and the resources needed to accomplish their tasks. If the objectives are accomplished
they feel elated.

Need for independence: - The need for independence is the prime characteristic that has driven the
entrepreneurs to start their own business. These entrepreneurs do not like to be controlled by others.
They do not wait for direction from others and choose their own course of action. They set their own
challenging goals and put efforts to achieve this goal. The independence provides opportunity for
trying out new ideas and helps them achieve their goals.

Creativity: - Entrepreneurs are highly creative people. They always try to develop new products,
processes or markets. They are innovative, flexible and are willing to adopt changes. They are not
satisfied with conventional and routine way of doing things. They involve themselves in finding new
ways of doing the things for the better.

Imaginative: - Successful entrepreneurs possess a high degree of imagination and foresightedness.

Entrepreneurs have a great vision. Knowing the present and the past the entrepreneur is able to predict
the future events the business more accurately than others. It is because of their visionary nature and
power of imagination that helps them in anticipating problems and evolving actions strategies for such
problems.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

Administrative ability: - A successful entrepreneur is always a good administrator. He knows the art
of getting things done by other people without hurting their feelings of self- respect. He has strong
motivation towards the achievement of a task and puts in necessary efforts in getting things done by
others.

Communication ability: - Communication ability is the ability to communicate effectively. Good

communications also means that both the sender and the receiver understand each other and are being
understood. An entrepreneur who can effectively communicate with customers, employees, suppliers
and bankers will always succeed in their business.

Clear objectives: - An entrepreneur has clear objectives as to the exact nature of the business, the
nature of the goods to be produced and the subsidiary activities to be undertaken. A successful
entrepreneur has the objective to establish the product to make profit or to render social service.

Business Secrecy: - An entrepreneur who is successful always guards his business secrets. Leakage of
business secrets to trade competitors is a serious matter; therefore an entrepreneur should carefully
guard it. An entrepreneur must be able to make a proper selection of his assistant since most of the
time it is the assistant who leaks the trade secret.

Emotional stability: - The most important personality factors contributing to the success of an
entrepreneur are emotional stability, personal relations, consideration and tactfulness. An entrepreneur
must maintain good relations with the customers if he wishes to enjoy their continued patronage. He
must also maintain good relation with his employees, whom he shall motivate to perform their jobs at
a high level of efficiency. An entrepreneur who maintains good human relations with customers,
employees, suppliers and the community has a better chance to succeed in his/ her business.

Technical knowledge: - Technical knowledge implies knowledge about the product, process or
technology used in manufacturing. An entrepreneur who has reasonable level of technical knowledge
will always be successful. Technical knowledge is easy to acquire if the entrepreneur tries hard to
acquire it.

Patience: - Patience means ability to wait. Patience also means doing the work and waiting for the
result. A certain amount of patience is necessary in any type of vocation. An entrepreneur should not
wait for actions but can certainly wait for result for his efforts.

Hard working and energetic: - Ability and willingness to work hard is an important quality of an
entrepreneur. A person having physical and mental stamina to cope with the hard work and human
relation is fit to become a successful entrepreneur. By carrying out well- planned and systematic work,
success is always the end result.

Good organizer: - Entrepreneurs are good organizers of resources like men, machines, materials and
money needed to start and run the business smoothly. They can convince the employees, investors,
customers and co- ordinate the activities of individuals and groups in the accomplishment of business
objectives. An entrepreneur works like a coordinating force among the resources, mould and manages
them effectively.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

Motivation for Economic Development and Entrepreneurial Achievement

Entrepreneurship is a major factor in the national economy; thus, it is important to understand
the motivational characteristics spurring people to become entrepreneurs and why some are more
successful than others. Meta -analysis of the relationship between achievement motivation and
variables associated with entrepreneurial behavior. We found that achievement motivation was
significantly correlated with both choice of an entrepreneurial career and entrepreneurial performance.
The role of entrepreneurship in economic development involves initiating change in the
structure of business and society. One theory of economic growth depicts innovation as the key, not
only in developing new products, but also in stimulating investment interest. The new capital created
expands the capacity for growth (supply side), and new spending utilizes the new capacity and output
(demand side.) In spite of the importance of investment and innovation in the economic development
of an area, there is still a lack of understanding of few factors which are as follows:
The product-evolution process is the process through which innovation develops and
commercializes through entrepreneurial activity, which in turn stimulates economic growth. It begins
with knowledge in the base technology and ends with products or services available in the
marketplace.
The critical point in the process is the intersection of knowledge and a recognized social need, called
the iterative synthesis. This point often fails to evolve into a marketable innovation.
Most innovations introduced in the market are ordinary innovations, with little uniqueness.
Technological innovations refer to new products with significant technological advancements.
Breakthrough innovations mean the development of new products with some technological change.
Regardless of the level of uniqueness or technology, each innovation evolves into and develops
towards commercialization through one of three mechanisms: the government, entrepreneurship, or
entrepreneurship. Entrepreneurship has assisted in revitalizing areas of the inner city. Individuals in
inner-city areas can relate to the concept and see it as a possibility for changing their present situation.
NEED FOR ACHIEVEMENT (ACHIEVEMENT MOTIVATION)
It is the psychological need to achieve. It provides drive to the entrepreneur to set up a new venture, to
achieve targets, to sense problems and opportunity, to take much risk so as to run the business
successfully. It is nothing but a persons desire either for excellence or to succeed in competitive
situation. Thus achievement motivation means a drive to overcome challenges in reaching higher
goals. It is a strong desire to achieve a higher goal and make dreams come true. In short it is the strong
desire to win.
ENTREPRENEURIAL MOTIVATION MODEL
Expectation.Intrinsic/Extrinsic Rewards
Outcome.................................................. ...........................
Comparison.................................................. .....................--
...................................................... ...................
Decision.......................................... .............................. .....
to Behave Ent. StrategyEnt. Management Firm Outcomes
Entrepreneurially.................................................. ......
...................................................... ............... ..... .
Implementation.................................................. ........
Outcome................ ..
Perception

Developing Creativity and Understanding Innovation

There are two (2) parts for me to explain; developing creativity and understanding innovation.
Developing creativity is a study about creative process which includes knowledge accumulation,
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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

incubation process, idea experience, evaluation, and implementation. Understanding innovation is a

learning process about what is innovation, to define and illustrate the sources of innovation, eliminate
some myths, to define the 10 principles of innovation, and illustrate the financial support for
innovation.

Developing Creativity

1. Knowledge accumulation
Knowledge about the role of creativity is very important for knowledge accumulation. There are two
(1) important aspects of creativity exist; process and people.
Process means solution finding to problem which also includes the factor of goals orientated. The
people are the resources that determine the solution through two (2) channels; adaptor and innovator.
Adaptor person will use methodical approach and innovator person search for new method of solution
from unusual angels which also futuristic.
2. Incubation process
Incubation process is much needed when entrepreneur engaged in problem which is unprecedented
and totally new which not yet a journal to be referred. During this time, entrepreneur needs to shift
themselves into free time zone and enjoy their indulge as refreshment e.g. playing outdoor/indoor
game, motor biking, cycling, golfing, sea surfing, etc.; while thinking new ideas or solution finding to
the specific problem.
3. Idea experience
Idea experience is a process when individual found the solution needed or discovered which also
means look solution in the form of idea but not yet in practical.
Sometimes it popped out in persons mind as bolt out of the blue. Although its in the form of idea
but it grow gradually and surely. This is the component of creativity also known as eureka factor as
it happened normally during incubation process.
4. Evaluation
Now is the time to test the said idea which was formed form eureka factor feasibility. During this
time it needs self-discipline and perseverance, much highly needed. On performing this type of
evaluation, sometimes it bubbles many new workable ideas and also sources from various/numerous
angles. Result speaks itself.
5. Implementation
The important part in implementation is working in network environment such as seeking expert
advice, determine quality sub-ordinates as participant (organize), prepare costs pro forma (financial
projection), prepare projection plan or plans related to goals orientated.

MODEL OF THE CREATIVE THINKING PROCESS

Incubation

Knowledge[Creative Process]Ideas

Evaluation and Implementation

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

ENTRE PRENEUR S HIP AND ECONOMIC DEV ELOPMENT

Entrepreneurial spirit of people is greatly responsible for economic development of any

country. There is no resource including diamond mines as valuable as human resource. South Africa
and a few other African countries despite their fertile gold and diamond mines have remained
poor/relatively poor, where as Japan with literally no natural resources and having suffered devastation
during WWII became a developed country in just three decades. Therefore, if a country allows its
human resources to be unutilized/underutilized (unemployment/disguised unemployment), its
economic development would be severely hampered. Failure of communism worldwide and our own
harrowing experience with socialism has shown that Govt has no business to be in Business. Govt
should only govern. Business activity should be left to people. And this is where entrepreneurs enter
the picture.
(a) Entrepreneurs set up enterprises which provide employment not only to themselves but to
many others directly and indirectly and thereby put into utilization Human Resource of the country.
(b) Entrepreneurs combine resources, put their time and efforts and produce goods or services.
The Value Addition that they do to the resources brings prosperity to the country.
(c) What they contribute productivity, output, value addition, income and employment
(d) Entrepreneurship is a Low Cost Strategy. An entrepreneur works with maximum
financial efficiency in order to maximize his profits. Entrepreneurs rarely indulge themselves in luxury
of Business Class travel and 5 Star Hotel comforts which the managers avail without fail. Thus, many
such costs are either avoided or kept in check. Entrepreneurs perform the crucial role themselves.
(e) The spirit of Entrepreneurship Drive, achieving higher goals, creativity, innovative
attitude.
(f) A dynamic society emerges and the spirit spreads like a chain reaction Many
entrepreneurs have proved to be catalyst for growth of a bevy of smaller entrepreneurs. Jamshedpur
was a small town before Tata Steel Plant was set up. Once the plant came up in the place, many people
set up their small enterprises to cater to the needs of the growing population.

ENTERPRISE AND SOCIETY

The emergence of the knowledge society, building on the pervasive influence of modern
information and communication technologies, is bringing about a fundamental reshaping of the global
economy. Its significance goes well beyond the hyping of the Internet. What is underway is a
transformation of our economy and society.

Knowledge has always been a factor of production, and a driver of economic and social
development. Earlier economies depended, for example, on knowledge about how to farm, how to
build and how to manufacture. However, the capacity to manipulate, store and transmit large
quantities of information cheaply has increased at a staggering rate over recent years.

The digitisation of information and the associated pervasiveness of the Internet are facilitating
a new intensity in the application of knowledge to economic activity, to the extent that it has become
the predominant factor in the creation of wealth. As much as 70 to 80 percent of economic growth is
now said to be due to new and better knowledge. Information and communication technologies (ICTs)
are also facilitating a rapid globalisatio of economic activity.

In an increasingly global economy, where knowledge about how to excel competitively and
information about who excels are both more readily available, the effective creation, use and
dissemination of knowledge is increasingly the key to success, and thus to sustainable economic and
social development that benefits us all. Innovation, which fuels new job creation and economic

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

growth, is quickly becoming the key factor in global competitiveness. Innovation fundamentally
means coming up with new ideas about how to do things better or faster.

It is about making a product or offering a service that no one had thought of before. And it is
about putting new ideas to work in enterprise and having a skilled work force that can use those new
ideas. It is a further feature of the knowledge economy that it increasingly relies on the diffusion and
use of information and knowledge, as well as its creation.

The success of enterprises, and of national economies, becomes increasingly dependent on the
information infrastructure that is necessary for the gathering and utilisation of knowledge. The
importance of broadband telecommunications infrastructure in this context must be recognised as no
less significant than the importance of electricity to 20th century industrial development.

Knowledge has become the key resource. Knowledge has value, but so too does knowledge
about knowledge. Creating value is about creating new knowledge and capturing its value. The most
important property is now intellectual property, not physical property. And it is the hearts and minds
of people, rather than traditional labour that are essential to growth and prosperity. Workers at all
levels in the 21st century knowledge society will need to be lifelong learners, adapting continuously to
changed opportunities, work practices, business models and forms of economic and social
organization.

WHY TO START BUSINESS

Entrepreneurship promotes small business in the society. Government has accepted the fact that small
firms have a crucial role to play in the economic development of the country. Small businesses are an
essential part of our future economic prosperity because of the following reasons-
EMPLOYMENT GENERATION:
Entrepreneurial development is looked at as a vehicle for employment generation through promotion
of small business. India, being far more developed and forward looking country than some of the third
world countries, can provide lead to entrepreneurial development activities. However, India can
benefit from the well- documented success experiences of developed countries like USA, Japan and
UK in the field of employment generation and small business promotion.
Steady growth in consumer spending, expanding retail sales, a strong housing market, continued
expansion of the service sector, low rates of inflation and of labour cost increases and failing interest
rates contributed to a healthy environment for small business.
In India, the government policies, political and economic environment greatly encourage the
establishment of new and small enterprises. Self- employment and small scale industry schemes have
been further liberalized during the last decade. The employment in the small-sector increased from
9.00 million people in 1984-85 to 13.9 million people in 1994-95. This indicates an increase of 5.4%
p.a in employment in this sector.
SMALL BUSINESS DYNAMISM:
Great dynamism is one of the qualities of the small and medium enterprises. This quality of dynamism
originates in the inherent nature of the small business. The structure of small and medium enterprises
is less complex than that of large enterprises and therefore facilitates quicker and smoother
communication and decision- making. This allows for the greater flexibility and mobility of small
business management. Also, small enterprises, more often make it possible for owners, who have a
stronger entrepreneurial spirit than employed mangers, to undertake risk and challenges.
BALANCED ECONOMIC DEVELOPMENT:
Small business promotion needs relatively low investment and therefore can be easily undertaken in
rural and semi-urban areas. This in turn creates additional employment in these areas and prevents
migration of people from rural to urban areas. Since majority of the people are living in the rural areas,

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

therefore, more of our development efforts should be directed towards this sector. Small enterprises
use local resources and are best suited to rural and underdeveloped sector. This in turn will also lead to
dispersal of industries, reduction in concentration of economic power and balanced regional
development.
INNOVATIONS IN ENTERPRISES:
Business enterprises need to be innovative for survival and better performance. It is believed that
smaller firms have a relatively higher necessity and capability to innovate. The smaller firms do not
face the constraints imposed by large investment in existing technology. Thus they are both free and
compelled to innovate.
Entrepreneurship development is accelerating the pace of small firms growth in India. An increased
number of small firms are expected to result in more innovations and make the Indian industry
compete in the international market.

ENTREPRENEURIAL TRAITS AND SKILLS

Traits of successful entrepreneurs

Starting a business is a lot of work. Anyone who tells you it's not is either lying or has never actually
started one themselves. The hours are long, sacrifices are great and you are assaulted with new
problems and challenges every day with seemingly no end. If you don't have the constitution to
weather these things, your business could implode on you faster than it started. Successful
entrepreneurs, from Henry Ford to Steve Jobs, share similar qualities with one another. To see how
you rank against these distinguished entrepreneurs, do you share at least half of these qualities.

1. Strong leadership qualities

Leaders are born, not made. Do you find yourself being the go-to person most of the time? Do you
find people asking your opinion or to help guide or make decisions for them? Have you been in
management roles throughout your career? A leader is someone who values the goal over any
unpleasantness the work it takes to get there may bring. But a leader is more than just tenacious. A
leader has strong communication skills and the ability to amass a team of people toward a common
goal in a way that the entire team is motivated and works effectively to get there as a team. A leader
earns the trust and respect of his team by demonstrating postive work qualities and confidence, then
fostering an environment that proliferates these values throught the team. A leader who nobody will
follow is not a leader of anything at all.

2. Highly self-motivated

You probably know from knowing even a little bit about some of the most famous business
entrepreneurs in history that leaders are typically pretty intense personalities. Nobody makes progress
by sitting back and waiting for it to find them. Successful people go out into the world and invoke
change throught their actions. Typically, leaders enjoy challenges and will work tirelessly to solve
problems that confront them. They adapt well to changing situations without unraveling and are
typically expert of helping their teams change with them by motivating them toward new goals and
opportunities. Often you will learn that successful entrepreneurs are driven by a more complete vision
or goal than simply the task at hand and able to think on a more universal level in that regard. They are
also often very passionate about their ideas that drive toward these ultimate goals and are notoriously
difficult to steer off the course.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

3. Strong sense of basic ethics and integrity

Business is sustainable because there is a common, understood code of ethics universally that
underpins the very fabric upon which commerce is conducted. While cheaters and thieves may win in
the short term, they invariably lose out in the long run. You will find that successful, sustainable
business people maintain the highest standards of integrity becauase, at the end of the day, if you
cannot prove yourself a credible business person and nobody will do business with you, you are out of
business. With importance in working with clients or leading a team, effective leaders admit to any
error made and offer solutions to correct rather than lie about, blame others for, or dwell on the
problem itself.

4. Willingness to fail

Successful entrepreneurs are risk takers who have all gotten over one very significant hurdle: they are
not afraid of failure. That's not to say that they rush in with reckless abandon. In fact, entrepreneurs
are often successful because they are calculating and able to make the best decisions in even the worst
of cases. However, they also accept that, even if they make the best decision possible, things don't
always go according to plan and may fail anyhow. If you've heard the old adage, "nothing ventured,
nothing gained," that's exactly what it's saying: do not be afraid to fail, put it out there and give it your
best shot. Again, there's not one successful entrepreneur out there sitting on his couch asking, "what
if."

5. Serial innovators

Entrepreneurs are almost defined by their drive to constantly develop new ideas and improve on
existing processes. In fact, that's how most of them got into business in the first place. Successful
people welcome change and often depend on it to improve their effectiveness as leaders and ultimately
the success of their businesses as many business concepts rely on improving products, services and
processes in order to win business.

6. Know what you don't know

While successful entrepreneurs are typically strong personalities overall, the best have learned that
there's always a lesson to be learned. They are rarely afraid to ask questions when it means the
answers will provide them insight they can then leverage to effect. Successful entrepreneurs are
confident, but not egotistical to the point that their bull-headedness is a weakness that continually
prohibits them from seeing a bigger picture and ultimately making the best decisions for the business.

7. Competitive spirit

Entrepreneurs enjoy a challenge and they like to win. They would have to since starting a business is
pretty much one of the biggest challenges a person can take on in their lifetime. In business it's a
constant war with competition to win business and grow market share. It's also a personal challenge to
use all of this to focus inward and grow a business from nothing into a powerhouse that either makes a
lot of money or is so effective that it is sold or acquired for a profit as well.

8. Understand the value of a strong peer network

In almost every case, entrepreneurs never get to success alone. The best understand it takes a network
of contacts, business partners, financial partners, peers and resources to succeed. Effective people

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

nurture these relationships and surround themselves with people who can help make them more
effective. Any good leader is only as good as those who support him.

Skills to Be a Successful Entrepreneur

What entrepreneurial skills are needed to be successful? What does it take to be an entrepreneur there
are many things that entrepreneurs develop overtime, usually by necessity, but these 6 entrepreneurial
skills are skills that are needed even before you start your business.

If you don't have all the skills listed below, do not get frustrated or scared, we can help you. Most
entrepreneurs develop the skills that they need for the business opportunity that they are building. We
can help you to learn what you need.

Read the list below and let Engineered Lifestyles know how we can help you.

Self Motivation - This is the most important skill of any entrepreneur. It's the ability to wake
up in the morning and start working. Sounds simple but if you don't do this you can literally
waste away the day doing things that have no benefit to your business. Even though you may
not have liked them, your bosses told you what needed to be done. Now as an entrepreneur,
you are the one that has to know what needs to be done and take action to get it done. Many
first time entrepreneurs spend their day's talking on the phone, filing and making binders or
documents for clients that don't even exist yet.
Self Confidence - If you don't share your products or business who will? That is why every
entrepreneur needs to be confident in themselves, their product and their business. You need to
know that your product can truly help people and that you are charging prices that are both fair
to you, and your clients.
Ethics and Morals - This is an area that has no code book. No Ethics Committee that you can
check with to see what is right or wrong. It is however the foundation of every good
entrepreneur. You must decide what you stand for and how you will conduct your business on
a daily basis. What lines won't you cross? You need to know those before you get tempted to
cross some that could jeopardize your business. The last thing that you want to do is make a
name for your business that people don't like or trust. No one wants to do business with
someone they trust! Would you?
Time Management - This goes hand in hand with Self Motivation. You as the entrepreneur
need to schedule your day and stick to that schedule. Your time is extremely valuable. When
you first start out you may not have enough business related activities to fill an eight hour day,
but do not waste your valuable time watching television or having long lunches. Take that time
and educate yourself on new ways to improve your business or products. Examples of this can
be anything from improving contacting skills to finding new and innovative ways to market
your business.
Sales - This can be very scary to some people. The though of having to sell something, but
every business has to work with, and develop a way to handle sales. As an entrepreneur it is
your job to develop the types of sales that will work best for your business and implement
them. A continuous effort should also be put on improving your sales skills.
Finance - This is a must if you are in business for yourself. Knowing how to balance a check
book and keeping track of numbered invoices is all most small businesses need to do when
they first start out. One of the most important things to remember is to make sure you schedule
time for your financial management.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

DYNAMICS AND CHANGES IN ENTREPRENEURSHIP

Changes in technology enabling new products and new production processes (e.g. the growth of
digital study products like this toolkit which are reducing demand for printed textbooks)

Changes in consumer tastes meaning that the demand for some products will decline, whilst others
will grow more popular (e.g. increased demand for activity-related holidays at the expense of mass-
market beach holidays)

Changes in the product ranges of competitors the introduction of new rival products, or changes
in pricing policies can greatly influence the demand for a product (e.g. the introduction of the
Microsoft X-Box which has challenged Sonys PlayStation 2)

Changes in economic conditions an improvement or worsening of the economic climate will have
an impact on incomes on a national or regional level. Different products may be affected differently
e.g. luxuries v necessities etc

THE PROCESS OF ENTREPRENEURSHIP

The myths that have grown up around the great entrepreneurs in America have focused more on the
personality of the individual than on the work that he or she did to create a prosperous organization.
What sticks in our memories are the qualities of a great entrepreneur, those personality traits that
"make" a great businessperson? Successful entrepreneurs, however, work hard to build their
organizations, starting from little and undertaking a process that results in a thriving business. Even
the best ideas become profitable only because the entrepreneur went through the steps necessary to
build a company from the ground up. Successful new ventures do not appear magically out of the swirl
of the marketplace; they are planned, created, and managed.

It is important to understand some of the stages a businessperson must go through in order to create a
successful entrepreneurial venture. All entrepreneurs go through three very general stages in the
process of creating their ventures: a concept formation stage where ideas are generated, the innovation
and opportunity are identified, and the business begins to take shape; a resource gathering stage where
necessary resources are brought together to launch the new business; and a stage where the
organization is actually created.

CONCEPTFORMATION Before any business opens its doors, it must make crucial decisions about
the way the business will be run. This first step in the entrepreneurial process is where the
entrepreneur determines what kind of potential market exists for the business and forms a rough idea
of how to penetrate the existing market. During the concept formation stage, the entrepreneur must
answer hard questions about the potential business as well as his or her own motivations for starting
his or her own business. The answers to these questions will provide the framework for future
planning, growth, and innovation.

There is a great deal that is unknown to the entrepreneur before he or she starts out. The viability of
the venture depends on the individual's ability to lessen that which is unknown and maximize that
which is known. The central question an entrepreneur should ask him or herself during the idea
generation stage is whether there is actually an opportunity for a successful venture. That is, will
starting a new business enable the entrepreneur to accomplish things or meet personal and professional
goals that he or she might not otherwise meet? Some entrepreneurs want to make a certain return on
their efforts and investment or are looking to run a business that will afford them a certain lifestyle.
Others are looking to capture a certain percentage of the market and thus increase their wealth. Still
others go into business for themselves because it would afford them the independence and freedom
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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

that working for someone else would not. Before taking the plunge, prospective entrepreneurs should
investigate the extent to which their envisioned business will give them an opportunity to meet their
goals.

A new business can be opened by anyone with the capital and time to do it. Nevertheless, businesses
that will be successful for years to come must maintain a certain level of financial soundness. Among
the first questions an entrepreneur should ask are those that explore the potential profitability of the
venture. The entrepreneur should be able to estimate sales and selling expenses as well as other costs
of doing business. In order to develop a sense of the economic feasibility of a venture, the
entrepreneur should investigate the size and other characteristics of the potential market for the
product or service, including competitive pressures and capital start-up requirements. Quantitative
analysis of the opportunity is a vital part of the conceptualization of the business. The results of
"running the numbers" and creating a set of figures with which the future can be planned will enable
the entrepreneur to determine whether the potential business will be profitable. "There is no more luck
in becoming successful at entrepreneurship than in becoming successful at anything else," wrote
William D. Bygraves in the Portable MBA in Entrepreneurship. "In entrepreneurship, it is a question
of recognizing a good opportunity when you see one and having the skills to convert that opportunity
into a thriving business. To do that, you must be prepared. So in entrepreneurship, just like any other
profession, luck is where preparation and opportunity meet."

RESOURCE GATHERING The first stage of the entrepreneurship process should give the
individual enough information to decide whether or not the business has the capacity to meet the
individual's personal and professional goals. Once the decision has been made, the entrepreneur may:
1) continue to work in his or her present employment capacity; 2) begin looking for a new
entrepreneurial opportunity that is a better fit; or 3) beings the second step in the entrepreneurial
process, that of gathering the necessary resources.

Without a sufficient supply of resources the opportunity might never be turned into a business that
makes money for the entrepreneur. In the resource gathering stage the entrepreneur begins to assemble
the tools that he or she will need to make the business idea a successful one. In general, a person has to
gather three types of primary resources: capital, human/managerial, and time. Capital can be financial
(in the form of cash, stock ownership, or loans), intellectual (patents, trademarks, brand names and
copyrights), and technical (innovations in design or production that competitors can not or will not
duplicate). Human resources refers to the individuals who will help the entrepreneur take advantage of
the opportunity, either as employees of the new organization or as paid and unpaid counselors. In
order to create a viable organization, an entrepreneur has to be ready and able to manage the resources
at his or her disposal, bringing them together in advantageous, efficient ways that meet the needs of
the fledgling organization.

An often-overlooked consideration in the resource gathering stage is time. Many entrepreneurial

ventures that manage to succeed do so in part because they were launched at an opportune time, and
because their founders were able to carve out an adequate amount of timea most valuable resource,
after allto attend to the myriad start-up needs of the business. For instance, a business based on a
patented technological innovation has a certain amount of time to operate before the patent expires and
competitors can duplicate the innovation. When the patent expires, the competitive advantage held by
the business is diminished or gone. Other businesses may be based on selling to an emerging market.
The entrepreneur who runs the business has a certain amount of time before potential competitors
notice that the business is (or will be) profitable. In that time framethe window of opportunitythe
entrepreneur who found the opportunity must manage resources so that the business is established and
protected from the threat of competition. In such instances, however, the would-be entrepreneur also

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

needs to avoid the common mistake of rushing in to take advantage of the opportunity without
adequately addressing all of the various elements that produce a successful start-up.

Things You Need to Do to Be a Successful Entrepreneur

the success of every entrepreneur (note the word entrepreneur) these principles might not apply to
everybody as far as success is concerned but the truth is you really need to follow them if you want to
succeed as an entrepreneur.

You Must be a Man of Decision

This also goes in line with the aspect of taking risks. Each major risk you take is a product of a strong
decision you have to make and the weak at heart or the indecisive entrepreneur will have a hard time
succeeding. True entrepreneurs learn to make wise decisions and they always make it fast, and a great
thing to know when trying to make the best decision is to know that youre not perfect or infallible and
that there always will be a failure in whatever you do this is not to prevent you from making some
decisions but, rather, be prepared for the worse.

Everything in life has advantages and disadvantages and a true entrepreneur wont just condemn a
decision because it has disadvantages. You should also be firm and stand with your decision no matter
what and you should make the term not wavering your watchword.

You Must be Ready to Improve

Many entrepreneurs are brought to a piece of bread because of the thing called ego, they are too
proud to learn from their mistakes and the funny thing is we keep on looking for excuses to make bad
things look good (believe me, that is why the named pride ego).

It doesnt matter whether you call it pride or ego, it cant take you anywhere as an entrepreneur. The
key to real success lies in bring yourself low because only he that brings himself low will go up and he
that sees himself as the ultimate is doomed already.

We are humans, we can never know all and we are so developed in such a way that we have to keep
learning, no matter how old or young we are, but what matters is how you learn and how you take
your learning. There are a lot of ways to learn and improve yourself as an entrepreneur, it can be by
learning from your mistakes, by learning from people who are highly successful, by learning from
those who are below you and even by learning from living and non living things; there is never
something called too much learning.

You Must Challenge the Usual

I am tired of a lot of things in my life lately and one of those things is being stagnant and on the same
spot for a very long time, in an attempt to make sure I move up and experience an exponential growth
I took a look at some of the entrepreneurs who are finding it extremely easy to succeed nowadays and
one major thing I found out about them is that they are unconventional. It now takes being bold and
completely truthful to succeed (which is exactly how it is supposed to be). The cold hard truth is this,
people are already tired of you telling and giving them what they want, they now really need to hear
and get what they need. A large percentage of these people will disagree with what Im saying but
what really moves people to take action nowadays is what they go against; that is why the most
controversial posts get shared the most and why the most controversial products go viral and bring
about success. A lot of people are already doing what people want and this makes entrepreneurs
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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

predictable unpredictability is a great weapon and you should always make sure people never know
your next move; the only way to do this is by doing what no other person does.

Utilize the Power of Association

First, Id like to tell you that there is a huge difference between association and networking.
Networking is more of a long-term relationship that works for both parties while association is a little
bit more selfish.

Association is like use and dump (it is not always that, though) and a sad truth is that successful
entrepreneurs know you sometimes have to be brutal, trust me!

Focus on Professionalism

If only I had a great idea, if only I can do this, if only I can do that and other sayings of these nature
are what brings about the failure of many entrepreneurs. Many people are yet to realize that in this our
age what matters most is not your idea but how you package it. What matters most is not your content
but how you present and deliver it you shouldnt expect people to just take your word for it and
believe your solution is what their problem needs but you should rather do things in a way that without
being told they will want to try your solution for their problems.

Always Revise

I wish I could get a better word for the last point but I think what really matters is you getting my
point. I can give you one million and one theories on achieving success as an entrepreneur but the
really true entrepreneur is the one that is uncontained. The real entrepreneur lives by no set rule but
has tried as many rules as hes heard, the reason he lives by no rule is that he keeps on dropping what
is not working for him while improving on that which gives him the best result.

Be passionate.

You must be passionate about what you're trying to achieve. That means you're willing to sacrifice a
large part of your waking hours to the idea you've come up with. Your passion will ignite the same
intensity in the others who join you as you build a team. And with passion, both your team and your
customers are more likely to truly believe in what you are trying to do.

Maintain focus.
Great entrepreneurs focus intensely on an opportunity where others see nothing. This focus and
intensity helps to eliminate wasted effort and distractions. Most companies die from
indigestion rather than starvation. Companies suffer from doing too many things at the same
time rather than doing too few things very well. Stay focused on the mission.
Rely on your team.
It's a simple fact: no individual can be good at everything. Everyone needs people around them
who have complementary skill sets. It takes a lot of soul searching to find your own core skills
and strengths. After that, find the smartest people you can who complement your strengths. It's
tempting to gravitate toward people who are like you; the trick is to find people who are not
like you but who are good at what they do-and what you can't do.

Focus on execution.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

Unless you are the smartest person on earth, it's likely that many others have thought about
doing the same thing you're trying to do. Success doesn't necessarily come from breakthrough
innovation, but from flawless execution. A great strategy alone won't win a game or a battle;
the win comes from basic blocking and tackling. No matter how much time you spend
perfecting your business plan, you still have to adapt according to the ground realities. You're
going to learn a lot more useful information from taking action rather than hypothesizing.
Have integrity.
I can't imagine anyone ever achieving long-term success without having honesty and integrity.
These two qualities need to be at the core of everything we do. Everybody has a conscience-
but too many people stop listening to it. There is always that faint voice that warns you when
you are not being completely honest or even slightly off track from the path of integrity. Be
sure to listen to that voice.

10 Reasons Why Entrepreneur Fail Their Business

If you want to be an entrepreneur, you should be aware of reasons why most first time entrepreneurs
fail their effort. Here are the reasons:

1. They Have No Written Plan

A business plan will be needed and people underestimate this. Written plan helps you to develop your
ideas into a real business in market. You must have the plan.

2. No Revenue

Most small business begins the effort without setting revenue on their effort. This is a bad start. You
need revenue and even the smallest one needs revenue to make more stabile company.

3. Business Opportunities are Limited

Sometimes, a good idea cannot be a great business too. This is maybe caused by the people not
wanting to buy your service or product. Do market research first.

4. Unable to Execute

Idea is not the one that worth the money. It is about the execution. You must be able to make even the
hardest decision and taking the risks wisely.

5. Competition is Too Much

If you do not have competitor then your idea is maybe out of market. However, too much competition
kills a business all the time too because the team cannot handle it.

6. They Have No Intellectual Property

You need to be more than registered. You also need to make your property patented, and you need to
have trademarks and copyrights.

7. Inexperienced Team

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

Having a team will be a great start but you also need people with enough experience to work with you.
They will know what to do and how to handle things. So, look for someone experienced when you
make vacancy ads.

8. Resource Requirements are Underestimated

Your cash is not the only needed capital. Your resource like marketing contacts, vendors partnership,
and others need to be well managed.

9. Small Marketing

Your business should have great promotion and it is should be assessed and executed by professional
marketing team. If you have nice product or service, you also need great marketing so people will buy
it.

10. Early Giving In

Most entrepreneurs are really serious at first time but they get tired sooner and they are exhausted in
trying. Instead of being that way, you should keep on going and try your best.

Now, learn from those reasons and try to avoid it and you will be one of few entrepreneurs who are
success since the very first time they establish a business.

STEP BY STEP PROCESS TO START UP A BUSINESS:-

Steps to be taken Agency to be contacted

1. Product selection and preparation of District Industries Centres/Small Industries
Project report. service Institutes/Technical consultancy agencies
like CECRI at Karaikudi, for specialised
products.
2. Obtaining provisional or permanent District Industries centre/Department of
registration Industries and commerce.
3. For obtaining developed plots for District Industries centres.
construction of a factory for obtaining sheds
in Industrial Estates on ownership/rental basis
4. If agricultural land is to be used for Small Scale Industries Development Corporation.
industrial purpose and permission from
Thasildar, to conclude lease deed.
5. Obtaining licenses for the plan, etc. Respective Corporation / Municipality /
Punchait, where the unit is to be set up
6. No objection certificate from pollution Respective State pollution control
Boards.
7. Registration under the Factories Chief Inspector of factories and Boilers.
Act
8. Finance Commercial banks/Industrial State finance Corporations-for term loans
co- op.banks.
9. Registration for sales tax State Commercial Tax Office

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur
Module-1 Entrepreneurship Development

10. Water supply Water supply and sewage Board.

11. Power connection State Electricity Board
12. Processing controlled raw material Joint Director(SSI)
13. For imported raw materials/machinery and The Joint Chief Controller of imports and
components exports
14. Obtaining machinery on hire purchase National Small Industries Corporation (NSIC)-
Regional offices.
15. Foreign collaboration The Foreign Investment Promotion
Board, Ministry of Industrial Development, Govt.
of India.
16. ISI Certificate Bureau of Indian Standards Institution, New
Delhi.
17. Patent Right The Controller of Patent and Designs.
18. Registration of Trade Marks Registrar of Trade Marks.
19. Marketing Assistance
a) Internal Marketing b) Export Marketing
20. Testing, Training and other extension Small Industries
Respective Service
State Institutes and Regional
Small
facilities Testing Laboratories.
Industries Marketing corporations. Export
Promotion Council/Cells;
21. Product development AssistanceProject and Project and product developmentTrade Development
product development Authority; State Trading corporation;
Export credit Guarantee Corporation and Export
Inspection Agency.
Decision for Entrepreneurial Start-up:-

Identifying all reasonable actions.

Listing the potential consequences of each action and the utility of each consequence.
Evaluating the probability that each action will lead to a given consequence.
Choosing the action quickly which has the best expected outcome or positive contribution.
Increased focused on customer satisfaction.
Shorter product lifecycle and shorter competitive advantage.
Increased complexity in business transaction,
Requirement for better, quicker and more actions by management.
Decisions for incorporation
Decisions for survival ness
Decisions for growth.
Decisions for promotion.

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Mr.M.KARTEEK, Asst.Professor
GIMS, GIET Campus, Gunupur