Entrepreneurship Session
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Transcript of Entrepreneurship Session
ENTREPRENEURSHIP:INTRODUCTION TO INITIATE
Prof: Karan .R. JaganiChapter 1
What Is An Entrepreneur?
ENTREPRENEUR
A vision-driven individual who assumes significant personal and financial risk to
start or expand a business.
2 Prof: Karan .R. Jagani
What Is An Entrepreneur?
ENTREPRENEURSHIP
The pursuit of opportunity throughinnovation, creativity and hard work
without regard for the resources currently controlled.
3 Prof: Karan .R. Jagani
Entrepreneurship4
• Entrepreneurship: a way of thinking, reasoning, and acting that is:
– opportunity obsessed– holistic in approach– and leadership balanced
Prof: Karan .R. Jagani
Who is an Entrepreneur?5
Situational more than personality
AgeDistribution
forStarting Company
Ability
Age
20 3025 35 4540
Flexibility
Prof: Karan .R. Jagani
Who is an Entrepreneur?6
Manager’s Opportunities
PerceivedCapability
Future Goals
Change Status Quo
Possible
Blocked
SatisfiedmanagerEntrepreneur
Frustratedmanager
Classicbureaucrat
Prof: Karan .R. Jagani
7
What is Your Entrepreneruial Potential?
8
Realistically assess your potential for anEntrepreneurial Career
Understand thepersonal attributesimportant for success in a business of your own
Understand thedemands theentrepreneurialrole will make onyou and yourfamily
Evaluateyour managerialskills
Conduct a personal financialassessment
Develop apersonalbalance sheet
Develop apersonalbudget
Assess your strengths and weaknesses that will affect your ability to achieve your entrepreneurial goals
Prof: Karan .R. Jagani
Why to be an entrepreneur?9
To be independent To utilize oneself To give a fair trial of his own talent and
skill To do something unique or outstanding To gain an economic reward To bring change in the society To solve a problem
Prof: Karan .R. Jagani
Achievement Motivation 10
Nine characteristics of achievement motivated people:- To take personal responsibility To take moderate risk TO know the results of his efforts To persist in the face of adversity To be innovative To demonstrate interpersonal competence To be future oriented To be mobile To not completely be content based
Prof: Karan .R. Jagani
11
1. Create new product and/or service businesses.
2. Bring creative and innovative methods to developing or producing new products or services.
3. Provide employment opportunities and create new jobs as a result of growing their businesses consistently and rapidly.
4. Help contribute to regional and national economic growth.
5. Encourage greater industrial efficiency/productivity to enhance our international competitiveness.
Entrepreneurs Can Play a Number of Roles in the Economy Prof: Karan .R.
Jagani
12
6. Stimulates redistribution of wealth, income and political power
7. Helps improving the social welfare by harnessing dormant and neglected talent
8. Facilitates transfer of technology to rural areas
9. Tools of job creation by virtue of its labour intensiveness
10. Restructuring and transformation of economy
Entrepreneurs Can Play a Number of Roles in the Economy (cont..)
Women Entrepreneur13
A women capable of achieving self economic independence individually or in collaboration, generates employment opportunities for others through initiating, establishing and running the enterprise by keeping place with her personal, family & social life.
Prof: Karan .R. Jagani
Why do Women Take-up Employment?14
• Push Factors– Death of bread winner– Sudden fall in family income– Permanent inadequacy in income of the family
• Pull Factors– Women’s desire to evaluate their talent– To utilize their free time or education– Need and perception of Women’s Liberation, Equity etc.– To gain recognition, importance and social status.– To get economic independence
Prof: Karan .R. Jagani
Women Entrepreneurship in India15
Earlier there were 3 Ks Kitchen Kids Knitting
Then came 3 Ps Powder Pappad Pickles
At present there are 4 Es Electricity Electronics Energy Engineering
Prof: Karan .R. Jagani
Some examples16
Mahila Grih Udyog 7 ladies started in 1959: Lizzat Pappad
Lakme Simon Tata
Shipping corporation Mrs. Sumati Morarji
Biocon Ms. Kiran Mazumdar Shaw
Herbal Heritage Ms. Shahnaz Hussain
Balaji films Ekta Kapoor
Prof: Karan .R. Jagani
Key elements for Success17
Elements of this Presentation are Courtesy of Dr. Mohan Sawhney @ Kellogg School of Management
Big
Idea
Competent
TeamSufficient
Money
Good
Plan
RelentlessRelentless
ExecutionExecution
And a generous helping of luck…And a generous helping of luck…
Prof: Karan .R. Jagani
18
INTRAPRENEURSHIP
“...Any of the dreamers who do. Those who take hands-on responsibility for creating innovation of any kind, within a business. The intrapreneur may be the creator or inventor but is always the dreamer who figures out how to turn an idea into a profitable reality.”
• Intrapreneurs are therefore people who put new ideas into action within established businesses.
• Although employed in a corporate position intrapreneurs are nevertheless given freedom and incentives to create and market their own ideas.
Prof: Karan .R. Jagani
FORMS OF ORGANIZATION
Prof: Karan .R. JaganiChapter 2
20
Factors to Consider in Selecting an Appropriate Business Entity
Liability - Limited Liability v. Personal Liability
Tax Implications Complexity of Formation and
Management Capital - effect on ability to raise capital
through angel investment, venture capital, or initial public offering (IPO)
Credibility in the business world
Prof: Karan .R. Jagani
Legal Forms of Business Organization
21
StructureOwnership
Requirements Tax Treatment Liability Advantages Drawbacks
Sole
proprietorship
One owner Income and losses “pass through” to owner and are taxed at personal rate
Unlimited personal liability
Low start-up costs
Freedom from most regulations
Owner has direct control
All profits go to owner
Easy to exit business
Unlimited personal liability
Personal finances at risk
Miss out on many business tax deductions
Total responsibility
May be more difficult to raise financing
General partnership
Two or more owners
Income and losses “pass through” to partners and are taxed at personal rate
flexibility in profit-loss allocations to partners
Unlimited personal liability
Ease of formation
Pooled talent
Pooled resources
Somewhat easier access to financing
Some tax benefits
Unlimited personal liability
Divided authority and decisions
Potential for conflict
Continuity of transfer of ownership
Prof: Karan .R. Jagani
Legal Forms of Business Organization
22
StructureOwnership
Requirements Tax Treatment Liability Advantages Drawbacks
Limited liability partnership (LLP)
Two or more owners
Income and losses “pass through” to partner and are taxed at personal rate; flexibility in profit-loss allocations to partners
Limited, Good way to acquire capital from limited partners
Cost and complexity of forming can be high
Limited partners cannot participate in management of business without losing liability protection
Prof: Karan .R. Jagani
Legal Forms of Business Organization
23
Group Entrepreneurship is turning entrepreneurship into a group of people instead of an individual, enabling them to undertake any business propositions. E.g. SEWA
Family enterprise is and enterprise which is managed and run within the family. Large no. of Indian businesses are family
run business.
Prof: Karan .R. Jagani
Small Enterprise24
A business that is independently owned and operated for profit and is not dominant in its field is known as small enterprise
Prof: Karan .R. Jagani
Advantages of small enterprise
25
Providing technological innovation Innovation among small-business workers is higher
than among workers in large businesses Small firms produce 2.5 times as many innovations
as large firms relative to the number of persons employed
More than half of the major technological advances of the 20th century originated with individual inventors and small businesses
Inventions may spark new industries or contribute to established industries
Prof: Karan .R. Jagani
Advantages of small enterprise
26
Providing employment Small firms hire a larger proportion of
younger workers, older workers, women, and part-time workers
Small businesses provide workers with their first job and initial job skills
Small businesses provide 2/3 of the net new jobs added to the economy
Prof: Karan .R. Jagani
Advantages of small enterprise
27
Providing competition Small firms can compete with large firms,
forcing the larger firm to become more efficient and responsive to customer needs
Filling needs of society and other businesses Small firms can meet the special needs of
smaller groups of customers Small firms can act as specialized suppliers
of goods and services to larger businesses
Prof: Karan .R. Jagani
Advantages of small enterprise
28
It helps in quick decision making It is adaptable to change Communication vertical and lateral is
fast and distinct Due to small size, effective integration of
production and market can be easily achieved
Doesn’t hesitate to take risks Are more simple and motivated
The Pro and Cons of Smallness
29
ADVANTAGES Personal relationships
with customers and employees
Ability to adapt to change
Simplified recordkeeping
Independence Advantages of sole
proprietorships Keeping all profits Ease and low cost of
going into business Keeping business
information secret
DISADVANTAGES Risk of failure Limited potential Limited ability to raise
capital
Prof: Karan .R. Jagani
Why Small Businesses Fail?30
Prof: Karan .R. Jagani