Entrepreneur & Entrepreneurial Development
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Transcript of Entrepreneur & Entrepreneurial Development
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Prepared by,Kushal Agarwal,Amit Kumar,Gaurav Seth
Entrepreneur &Entrepreneurial
development
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Who is an Entrepreneur?An entrepreneur is a person who starts anenterprise.
Peter Druckerdefines an entrepreneur asone who always searches for a changeresponds to it and exploits it as anopportunity. An entrepreneur innovates.
Innovation is a specific instrument of successavailable to entrepreneur.
According to Schumpeterentrepreneurs areinnovators who use a process of shattering
the status quo of the existing products and
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So we can say that an ENTREPRENEUR..
Is a person who develops and owns his ownenterprise
Is a moderate risk taker and works underuncertainty for achieving the goal.
Is innovative
Reflects strong urge to be independent.
Persistently tries to do something better.
Dissatisfied with routine activities.
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So we can say that an ENTREPRENEURCont..
Prepared to withstand the hard life.
Determined but patient
Exhibits sense of leadership
Also exhibits sense of competitiveness
Takes personals responsibility
Is Oriented towards the future.
Tends to persist in the face to adversity
Converts a situation into opportunity.
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What Makes Someone anEntrepreneur?
Creativity
Dedication
Determination
Flexibility
Leadership
Passion
Self-confidence
Smartness
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Views on making of an Entrepreneur
Economists view
Sociologists view
Psychologists view
Managers view
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Economists view
The economists view him as a fourth factor ofproduction along with land labor and capital.
1. Land.2. Labor.
3. Capital.
4. Entrepreneurship.
Economic incentives are the main motivatorsfor entrepreneurial activities.
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Economists view Cont..
Entrepreneurship and economic growth takeplace when the economic conditions arefavorable.
Mainstream economists view the supply ofentrepreneurship as highly elastic.
J.B. Say has stated that it is function of theentrepreneur to rationally combined the
forces of production into a new producingor anization
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Economists view Cont..
SCHUMPETERS entrepreneur possess threequalities:
An intuitional capacity to see things in a waywhich afterwards proves to be true;
A kind of effort of will and mind to overcomefixed habits of thinking; and
The capacity to overcome social oppositionagainst doing something new.
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Sociologists view
The sociologists feel that certain communitiesand cultures promote entrepreneurship likefor example in India we say that Gujaratis and
Sindhis are very enterprising.
Sociologists focused on theories thatconsidered the role of social norms and
legitimacy as well as social mobility inunderstanding the supply of entrepreneurshipin a society.
According to Peter Marris, to assemble or
reassemble from what is available, very
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Sociologists view Cont..
According to the sociologists the presence orabsence of certain social baits motivate or de-motivate individuals from taking up
entrepreneurial ventures. some of theimportant ones are:
Family background
Religious backgroundThe age of entry to entrepreneurship
Occupational background
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Psychologists view
The entrepreneur
wants to prove himself/herself more than
othershas the pressure to reach something
wants to be in control
is convinced he/she can do it betteris not afraid of taking risks
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Psychologists view Cont ..
Psychologists focused on such factors as theachievement-orientation and status-orientation of individuals within a population
to consider their likelihood of engaging inentrepreneurial behavior.
Psychologists emphasize that
entrepreneurship is not likely to emerge ordevelop when a society has a sufficient supplyof individuals possessing certain psychologicalcharacteristics such as adventures nature,ability to take calculated risk, communicationskills, leadership qualities, hardworking by
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Psychologists view Cont ..
Entrepreneurship gets a boost when societyhas sufficient supply of individuals withnecessary psychological characteristics
The psychological characteristics include needfor high achievement, a vision or foresight,ability to face opposition
These characteristics are formed during theindividuals upbringing which stress onstandards of excellence, self reliance and lowfather dominance
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Psychologists view Cont ..
According to McClellandit is high need forachievement which drives people towardsentrepreneurial activities.
Among psychologists, Frank Young describesan entrepreneur as a change-agent.
K. L. Sharma maintains that entrepreneurs are
men with qualities of leadership in solvingpersistent professional problems; but thosepersons likewise demonstrate eagerness toseize unusual opportunities.
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Managers view
Managers feel entrepreneurs areinnovators who come up with new ideas forproducts, markets or techniques.
According to Peter Kilby an Entrepreneur isone who performs the following functions:
Perception of market opportunities
Gaining command over scarce resources
Purchasing inputs
Marketing of product & responding to
competition
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ROLE OF ENTREPRENEURS IN SOCIO-ECONOMICDEVELOPMENT OF A COUNTRY
Entrepreneurship promotes capital formation bymobilizing the idle saving of the public.
It provides immediate large-scale employment. Thus, ithelps reduce the unemployment problem in the country,i.e., the root of all socio-economic problems.
It promotes balanced regional development.
It helps reduce the concentration of economic power.
It stimulates the equitable redistribution of wealth, incomeand even political power in the interest of the country.
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ROLE OF ENTREPRENEURS IN SOCIO-ECONOMICDEVELOPMENT OF A COUNTRY Cont..
It encourages effective resource mobilization of capitaland skill which might otherwise remain unutilized andidle.
It also induces backward and forward linkages whichstimulate the process of economic development in thecountry.
Last but no means the least, it also promotes country'sexport trade i.e., an important ingredient to economicdevelopment.
Thus it is dear that entrepreneurship serves as a catalyst of
economic development. On the whole, the role ofentre reneur shi in economic develo ment of a countr
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Growth ofEntrepreneurship InIndiaThe growth of entrepreneurship in India can be
presented into two sections viz..
Entrepreneurship during Pre-Independence
Entrepreneurship during Post-Independence
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Entrepreneurship during Pre-
Independence Before India came into contact with west, Indiantowns were mostly religious and aloof from thegeneral life of country.
Organized industrial activity was observableamong the India artisans in a few recognizableproducts in the cities of Banaras, Allahabad,Gaya, Puri & Mirzapur.
Much prestigious Indian handicraft industry,which was basically a cottage and small sector,declined at the end of the 18th century forvarious reasons.
Some scholars hold the view that manufacturin
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.Entrepreneurship during
Pre-Independence..The actual emergence of manufacturingentrepreneurship can be noticed in the secondhalf of the 19th century. Prior to 1850, some stayfailure attempts were, indeed , made by theEuropeans to setup factories in India.
The second wave of entrepreneurial growth inIndia began after the First World War.
Government agreed to 'discriminating' protectionto certain industries, even requiring thatcompanies receiving its benefits should beregistered in India with rupee capital and have aproportion of their directors as Indians.
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..Entrepreneurship during Pre-Independence
Reasons for slow growth of entrepreneurship inDuring British period in India :..
Not given proper protection
Discouragement by British Government
High railway freight charges
Exorbitant tariffs
Constantly harassed for getting licenses
No facilities for technical education
Entrepreneurs faced fierce competition from abroad
Lack of transportation and communication facilities
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ENTERPRENEURSHIP DURINGPOST- INDEPENDENCE
Government came forward with the firstIndustrial Policy, 1948 which was revised fromtime to time.
Government took three important measures inher industrial resolutions:-
(i) to maintain a proper distribution ofeconomic power between private and public
sector;
(ii) to encourage the tempo of industrializationby spreading entrepreneurship from the existingcenters to other cities, towns and villages, and
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.DURING POST-
INDEPENDENCE.. Several institutions like Directorate of Industries,Financial Corporations, Small-Scale IndustriesCorporations and Small Industries ServiceInstitute were also established by the
Government . Small-scale units emerged very rapidly in India
witnessing a tremendous increase in theirnumber from 121,619 in 1966 to 190,727 in
1970 registering an increase of 17,000 units peryear during the period under reference.
Prior to 1850, the manufacturingentrepreneurship was negligible lying dormant inartisans.
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..ENTERPRENEURSHIPDURING POST-INDEPENDENCEEven the small entrepreneurship continuedto be dominated by business communitiesthough at some places new groups of
entrepreneurs too emerged.some entrepreneurs grew from small to
medium-scale and from medium to large-
scale manufacturing units during theperiod.
The family entrepreneurship units like Tata,Birla, Mafatlal, Dalmia, Kirloskar and othersrew be ond the normall ex ected size
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DURING POST-
INDEPENDENCE.From 1980 to 1991, the averagenumber of companies formed
each year was 14,379, whilefrom 1992 to 2006, the averagenumber of companies formed
per year was 33,835.According to the paper,liberalisation itself kick-started
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ENTREPRENEURSHIP IN
INDIA According to the Global Entrepreneurship Monitor(2007) report, Indias High-Growth Expectation Early-Stage Entrepreneurship (HEA) rate is only one-fifth ofthat of China.
According to the NSS 62nd round, in rural India,almost 50 per cent of all workers are self-employed 57 per cent among males and nearly 62 per centamong females, while the corresponding figures in
urban India are 42 for males and 44 for females.
According to the 5th Economic Census conducted bythe Central Statistical Organisation (CSO), there are41.83 million establishments in the country engaged
in different economic activities other than crop
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Issues in the Current Framework
Finance: Access to credit isconsidered to be one of the keyproblems faced by
entrepreneurs .
Regulation and governance:An entrepreneur has to registerones business, obtain
government clearances and
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Issues in the Current Framework ..
Manpower: Availability ofskilled manpower is another
crucial issue forentrepreneurs.
- In the Global
Competitiveness Index, Indiaranks 102nd in hiring and f ring
practices and 85th in
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ENTREPRENEURSHIP
DEVELOPMENT IN INDIA In India there is a dearth of quality peoplein industry, which demands high level ofentrepreneurship development
programme through out the country forthe growth of Indian economy.
The scope of entrepreneurship
development in country like India istremendous.
the current generations of youth do nothave hang-ups about the previous legacyand are willin to ex eriment. These are
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Queries
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