UNIT 5

Entrepreneurship is a process of identifying and starting a business venture,

sourcing and organizing the required resources and taking both the risks and rewards
associated with the venture. "Entrepreneurship" may result in new organizations or
revitalize mature organizations in response to a perceived business opportunity. A
new business started by an entrepreneur is referred to as a startup company. In recent
years, the term has been extended to include social and political forms of entrepreneurial
activity. Entrepreneurial activities differ substantially depending on the type of
organization and creativity involved. Entrepreneurship ranges in scale from solo projects,
and even just part-time projects, to major undertakings that create many job
opportunities. Entrepreneurship is a creative activity. It is the ability to create and build
something from practically nothing. It is a knack of sensing opportunity where others see
chaos, contradiction and confusion. Entrepreneurship is the attitude of mind to seek
opportunities, take calculated risks and derive benefits by setting up a venture. It
comprises of numerous activities involved in conception, creation and running an
enterprise.

Own Boss

Make own plans

Creative activity Can be negative sometimes,

Creates Wealth, contributes to GDP

Can choose from- Industry, Trade or Service Enterprise.

ENTREPRENEUR

It is defined as an individual who organizes or operates a business or businesses.

Entrepreneurs are non-fixed income earners who pay known costs of production but earn
uncertain incomes. The economists view him as a fourth factor of production along with
land labour and capital. The sociologists feel that certain communities and cultures
promote entrepreneurship.

FUNCTIONS:

An entrepreneur frequently has to wear many hats. He has to perceive

opportunity, plan, organize resources, and oversee production, marketing, and liaison
with officials. Most importantly he has to innovate and bear risk.

The main functions of an entrepreneur are as follows:

1. INNOVATION: Innovation is one of the most important functions of an entrepreneur
according to Schumpeter. An entrepreneur uses information, knowledge and intuition to
come up with new products, new methods of reducing costs of a product, improvement
in design or function of a product, discovering new markets or new ways of organization
of industry. Through innovation, an entrepreneur converts a material into a resource or
combines existing resources into new and more productive configurations.

2. RISK AND UNCERTAINTY BEARING: an entrepreneur performs the function of

risk and uncertainty bearing. Every decision pertaining to development of new products,
adapting new technologies, opening up new markets involves risk. Decision-making in an
environment of uncertainty requires anticipation of risk. Profit is said to be the reward for
anticipating and taking such risks. However it is pertinent to mention that the
entrepreneur is not a gambler, he only takes calculated risks. An entrepreneur develops
the art of decision-making under conditions of uncertainty as a Matter of survival.

3. ORGANIZATION BUILDING: An entrepreneur has to organize men, material and

other resources. He has to perform the functions of planning, co-ordination and control.
He has to use his leadership qualities to build a team, generate resources and solve
problems. With his organizational skills an entrepreneur builds an enterprise from scratch,
nurtures it and makes it grow. His vision sows the seeds for a sound and vibrant
organization and synergies are built in the enterprise.

In a developing country even the imitator entrepreneurs are very important and
the entrepreneurial role encompasses the following:

i. Perception of market opportunities

ii. Gaining command over scarce resources

iii. Purchasing inputs

iv. Marketing the products

v. Dealing with bureaucrats

vi. Managing human relations within the firm

vii. Managing customer and supplier relations

viii. Managing finance

ix. Managing production

x. Acquiring and overseeing assembly of the factory

xi. Industrial engineering

xii. Upgrading process and product

xiii. Introducing new production techniques and products

STARTING A NEW INDUSTRY:

Industrial development significantly contributes towards economic

growth.Howevwer,industrial progress brings along with it a host of environmental
problems.Many of these problems could be avoided if industries are located on the basis
of environmental considerations, injudicious siting of industry can seriously effect the
environmental features such as air,water,land,flora,fauna,human settlements and health of
people.The entrepreneur should be fully aware of these implications and he should take
necessary steps while setting up the industry so as to minimise the possible adverse
effects on the environmental resources and quality of life.

The Industrial Policy Statement of July 1980,recognised the need for preserving
ecological balance and improving living conditions in the urban centers of the country.On
the basis of this Policy,indiscriminate expansion of the existing industries and setting up
of new industrial undertakings within the lomits of metropolitan cities and the larger
towns should not be permitted.However,the Policy has not touched upon the implications
of setting up an industry in sensitive areas,both ecological or otherwise,which would have
an effecton the overall development process.

At present,industries are being located on the basis of raw material

availability,access to the market,transport facilities and such other techno-economic
considerations without adequate attention to environmental considerations are recognised
as an important criterion for setting of industry. To prevent,air,water and soil pollution
arising out of industrial projects,the industrial Licensing procedure requires that the
entrepreneurs before setting up the industry obtain clearance from Central/State Air and
Water Pollution Control Boards.The Central State Pollution Control Boards stipulate that
air(gases) and water(effluents) emanating from the industry should adhere to certain
quality standards.The entrepreneur will bee required to submit half-yearly progress report
on installation of pollution control devices to the respective State Pollution Control
Boards.

CENTRES :

CED:

The Centre for Entrepreneurship Development (CED) is an undertaking of

Association of Lady Entrepreneurs of Andhra Pradesh (ALEAP) registered under Society
Act in 1997. The majestic and sprawling campus is located in ALEAP industrial estate
near Kukatpally, Hyderabad, AP, INDIA.
CED helps prospective and existing entrepreneurs with the following services:

Imparts the skills for becoming successful entrepreneurs

Provide information from supporting government departments & financial institutions

Provide assistance in project preparation and presentation to the bankers

Arrange interactions with successful entrepreneurs

Arrange factory visits

Providing hand-holding support after the training.

CHENRAJ ROYCHAND CENTRE FOR ENTREPRENEURSHIP

The CRCE an entrepreneurial wing of Jain Group of Institutions was established to

create opportunities for the talented and dynamic individuals to realise their
entrepreneurial potential. CRCE provides an integrated yet simplified, progression route
into:

Business -create opportunities, support students and entrepreneurs looking to start their
own business. Through our experience and success we have developed highly interactive
and specific packages of business start up support and tools that allow budding
entrepreneurs progress

Culture -The Entrepreneurial Culture Concept crosscuts all the other areas. We pride
ourselves in thinking, acting and being a market leader in entrepreneurial mind set, life
style and activities. We help to develop innovative thinking, entrepreneurial mindsets and
expose different ways of thinking and working all within a highly ethical and practical
manner.

Education -have also been supportive in providing students with the knowledge, skills
and motivation to encourage entrepreneurial success in a variety of settings. Variations of
entrepreneurship education are offered at all levels of schooling from K-12 schools
through graduate university programmes.

Research -The CRCE consists of a board of council comprising experts from the
corporate world. Our focus is applied research with end goals in mind. We provide
solutions and options from idea to growth phases, applicable to any business or project.
PROJECT MANAGEMENT:

project is the process and activity of planning, organizing, motivating, and

controlling resources, procedures and protocols to achieve specific goals in scientific or
daily problems. A project is a temporary endeavor designed to produce a unique product,
service or result with a defined beginning and end (usually time-constrained, and often
constrained by funding or deliverables), undertaken to meet unique goals and objectives,
typically to bring about beneficial change or added value. The temporary nature of
projects stands in contrast with business as usual which are repetitive, permanent, or
semi-permanent functional activities to produce products or services.

PROCESS:

Major process groups generally include:

Initiation

Planning or design

Production or execution

Monitoring and controlling

Closing

1. The initiating stage should include a plan that encompasses the following areas:

 analyzing the business needs/requirements in measurable goals

 reviewing of the current operations

 financial analysis of the costs and benefits including a budget

 stakeholder analysis, including users, and support personnel for the project

 project charter including costs, tasks, deliverables, and schedule.

2. Project planning generally consists of

 determining how to plan (e.g. by level of detail or rolling wave);

 developing the scope statement;

 selecting the planning team;

 identifying deliverables and creating the work breakdown structure;

  identifying the activities needed to complete those deliverables and networking
the activities in their logical sequence;

 estimating the resource requirements for the activities;

 estimating time and cost for activities;

 developing the schedule;

 developing the budget;

 risk planning;

 Gaining formal approval to begin work.

3. Executing consists of the processes used to complete the work defined in the project
plan to accomplish the project's requirements. Execution process involves coordinating
people and resources, as well as integrating and performing the activities of the project in
accordance with the project management plan. The deliverables are produced as outputs
from the processes performed as defined in the project management plan and other
frameworks that might be applicable to the type of project at hand.

4. Monitoring and controlling consists of those processes performed to observe project

execution so that potential problems can be identified in a timely manner and corrective
action can be taken, when necessary, to control the execution of the project. The key
benefit is that project performance is observed and measured regularly to identify
variances from the project management plan.

5. Closing includes the formal acceptance of the project and the ending thereof.
Administrative activities include the archiving of the files and documenting lessons
learned.

PROJECT APPRAISAL

INTRODUCTION: Project appraisal is a generic term that refers to the process of

assessing, in a structured way, the case for proceeding with a project or proposal. In short,
project appraisal is the effort of calculating a project's viability. It often involves
comparing various options, using economic appraisal or some other decision
analysis technique. Project appraisal is the process of assessing and questioning proposals
before resources are committed. It is an essential tool for effective action in community
renewal. Project appraisal is a requirement before funding of programs is done. But
tackling problems like those outlined above is about more than getting the systems right
on paper. Experience in projects emphasizes the importance of developing an ‘appraisal
culture’ which involves developing the right system for local circumstances and ensuring
that everyone involved recognizes the value of project appraisal and has the knowledge
and skills necessary to play their part in it.

APPRAISING A PROJECT

 Need, targeting and objectives

 Context and connections

 Consultation

 Options

 Inputs

 Outputs and outcomes

 Value for money

 Implementation

 Risk and uncertainty

 Forward strategies

 Sustainability