Entrepreneurship development programmes, Study notes of Business Ethics

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ENTREPRENEURSHIP DEVELOPMENT

Common Course

For

B.Com / BBA

IV SEMESTER

BCM4A13 / BBA4A

2019 Admission Onwards

University of Calicut

School of Distance Education

SCHOOL OF DISTANCE EDUCATION

Study Material

COMMON COURSE

IV SEMESTER – B.COM/BBA

2019 Admission Onwards

BCM4A13 / BBA4A13 – ENTREPRENEURSHIP DEVELOPMENT

Prepared by:

Dr. Sudheesh S

Assistant Professor on Contract School of Distance Education University of Calicut

Scrutinized by:

Dr. Lakshmanan M P Assistant Professor and Head PG Department of Commerce Govt: College, Chittur

UNIVERSITY OF CALICUT

Module – I

Concept of Entrepreneur According to George Bernard Shaw, people fall into three categories: (i) those who make things happen. (2) Those who watch things happen, and (3) those who are left to ask what did happen. Generally, entrepreneurs fall under the first category.

Evolution of the Concept of Entrepreneur The word ‘entrepreneur’ is derived from the French word entreprendre. It means ‘to undertake’. Thus, entrepreneur is the person who undertakes the risk of new enterprise. Its evolution is as follows.

 Early Period : The earliest definition of the entrepreneur as a go-between is Marco Polo. He tried to establish trade route to the far East. He used to sign a contract with a venture capitalist to sell his goods. The capitalist was the risk bearer. The merchant adventurer took the role of trading. After his successful selling of goods and completing his trips, the profits were shared by the capitalist and the merchant.  Middle Ages : The term entrepreneur was referred to a person who was managing large projects. He was not taking any risk but was managing the projects using the resources provided. An example is the cleric who is in charge of great architectural works such as castles, public buildings, cathedrals etc.  17 th^ Century: An entrepreneur was a person who entered into a contractual arrangement with the Govt. to perform a service or to supply some goods. The profit was taken (or loss was borne) by the entrepreneur.  18 th^ Century : It was Richard Cantillon, French Economist, who applied the term entrepreneur to business for the first time. He is regarded by some as the founder of the term. He defined an entrepreneur as a person who buys factor services at certain prices with a view to sell them at uncertain prices in the future.  19 th^ Century: The entrepreneurs were not distinguished from managers. They were viewed mostly from the economic perspective. He takes risk, contributes his own initiative and skills. He plans, organizes and leads his enterprise.  20 th^ Century: During the early 20th^ century Dewing equated the entrepreneur with business promoter and viewed the promoter as one who transformed ideas into a profitable business. It was Joseph Schumpeter who described an entrepreneur as an innovator. According to him an entrepreneur is an innovator who develops untried technology.  21th Century : Research Scientists live De Bone pointed out that it is not always important that an individual comes up with an entirely new idea to be called an entrepreneur, but if he is adding incremental value to the current product or service, he can rightly be called an entrepreneur.

Meaning and Definition of an 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 fulfil such economic opportunities”. He further said, “An entrepreneur is an innovator playing the role of a dynamic businessman adding material growth to economic development”.

Characteristics of Entrepreneur An entrepreneur is a highly achievement oriented, enthusiastic and energetic individual. He is a business leader. He has the following characteristic:

1. An entrepreneur brings about change in the society. He is a catalyst of change.
2. Entrepreneur is action-oriented, highly motivated individual who takes risk to achieve goals.
3. Entrepreneur accepts responsibilities with enthusiasm and endurance.
4. Entrepreneur is thinker and doer, planner and worker.
5. Entrepreneur can foresee the future, seize market with a salesman’s persuasiveness, manipulate funds with financial talent and smell error, frauds and deficiencies with an auditor’s precisions.
6. Entrepreneur undertakes venture not for his personal gain alone but for the benefit of consumers, government and the society as well.
7. Entrepreneur builds new enterprises. He possesses intense level of determination and a desire to overcome hurdles and solves the problem and completes the job.
8. Entrepreneur finds the resources required to exploit opportunities. 9) Entrepreneur does extraordinary things as a function of vision, hard work, and passion. He challenges assumptions and breaks rules. 10) Although many people come up with great business ideas, most of them never act on their ideas.

Classification of entrepreneur- Entrepreneurs may be classified in a number of ways.

A. ON THE BASIS OF TYPE OF BUSINESS

Entrepreneurs are classified into different types. They are 1) Business Entrepreneur : He is an individual who discovers an idea to start a business and then builds a business to give birth to his idea. 2) Trading Entrepreneur : He is an entrepreneur who undertakes trading activity i.e., buying and selling manufactured goods.

E. CLASSIFICATION ON THE BASIS OF ENTREPRENEURIAL ACTIVITY :

They are classified as follows: 1) Novice : A novice is someone who has started his/her first entrepreneurial venture. 2) Serial Entrepreneur : A serial entrepreneur is someone who is devoted to one venture at a time but ultimately starts many. He repeatedly starts businesses and grows them to a sustainable size and then sells them off. 3) Portfolio Entrepreneurs: A portfolio entrepreneur starts and runs a number of businesses at the same time. It may be a strategy of spreading risk or it may be that the entrepreneur is simultaneously excited by a variety of opportunities.

F. CLASSIFICATION BY CLARENCE DANHOF: Clarence Danhof, On the basis of American agriculture, classified entrepreneurs in the following categories: 1) Innovative Entrepreneurs : They are generally aggressive on experimentation and cleverly put attractive possibilities into practice. An innovative entrepreneur, introduces new goods, inaugurates new methods of production, discovers new markets and reorganizes the enterprise. Innovative entrepreneurs bring about a transformation in lifestyle and are always interested in introducing innovations. 2) Adoptive or Imitative Entrepreneurs : Imitative entrepreneurs do not innovate the changes themselves, they only imitate techniques and technology innovated by others. They copy and learn from the innovating entrepreneurs. While innovating entrepreneurs are creative, imitative entrepreneurs are adoptive. 3) Fabian Entrepreneurs : These entrepreneurs are traditionally bounded. They would be cautious. They neither introduce new changes nor adopt new methods innovated by others entrepreneurs. They are shy and lazy. They try to follow the footsteps of their predecessors. They follow old customs, traditions, sentiments etc. They take up new projects only when it is necessary to do so. 4) Drone Entrepreneurs : Drone entrepreneurs are those who refuse to adopt and use opportunities to make changes in production. They would not change the method of production already introduced. They follow the traditional method of production. They may even suffer losses but they are not ready to make changes in their existing production methods.

There is another classification of entrepreneurs. According to this, entrepreneurs may be broadly classified into commercial entrepreneurs and social entrepreneurs.

Commercial Entrepreneurs: They are those entrepreneurs who start business enterprises for their personal gain. They undertake business ventures for the purpose of generating sales and profits. Most of the entrepreneurs belong to this category.

Social Entrepreneurs : They are those who identify, evaluate and exploit opportunities that create social values and not personal wealth. Social values refer to the basic long standing needs of society. They focus on the disadvantaged sections of the society. They play the role of change agents in the society. In short, social entrepreneurs are those who start ventures not for making profits but for providing social welfare.

Entrepreneurial Competency or Traits Competency is a characteristic of a person, which results in effective and/or superior performance in a job. It is a combination of knowledge, skills and appropriate motives or traits that an individual must possess to perform a given task. It is defined as characteristics such as generic and special knowledge, motives, traits, self- image, social roles and skills which result in birth of a venture, its survival and/ or growth. In short, the competencies required by an entrepreneur for starting a business venture and carrying it on successfully are known as entrepreneurial competencies.

Types of Entrepreneurial Competencies

It may be classified into two types:

A) Personal Entrepreneurial Competencies: These are required to perform the tasks effectively and efficiently. This includes the following:  Initiative : It is an inner urge in an individual to do or initiate something.  Ability to See and Act on Opportunities : Entrepreneurs look for opportunities and take action on such opportunities.  Persistence: It means the capacity or skill to take repeated and different actions to overcome obstacles.  Information Seeking : A successful entrepreneur always keeps his eyes and ear open. He should accept new ideas which can help him in realizing his goals. He is ready to consult experts for getting their expert advice.  Concern for High Quality of Work : Entrepreneurial persons act to do things that meet or beat existing standards of excellence.  Commitment to Work : Successful entrepreneurs are prepared to make all sacrifices for completing the commitments they have made.  Commitment to Efficiency : Entrepreneurial persons have to look and find ways for or find ways to do things faster or with fewer resources or at a lower cost. They should try new methods aimed at making work easier, simpler, better and economical.  Systematic Planning : Entrepreneurial persons should be able to develop and use the logical step by step plans to reach goals.  Problem Solving : Entrepreneurial persons are supposed to possess the skill of identifying new and potentially unique ideas to reach goals. They should generate new ideas or innovative solutions to solve problems.  Assertiveness : They assert own competence, reliability or other personal or company’s qualities. They also assert strong confidence in own company’s products or services.  Persuasion: Entrepreneurs should have the ability to successfully persue others to perform the activities effectively and efficiently.  Use of Influence Strategies : Entrepreneurs should have the competence of using a variety of strategies to influence others. Such entrepreneurs can develop business contacts and use influential people to accomplish his/her own objectives.

2. Managing production.

4. Technology: 1) Acquiring and overseeing assembly of the factory. 2) Industrial engineering. 3) Upgrading process and product quality. 4) Introducing new products.

According to Arther H. Cole, an entrepreneur performs the following functions :

1) Determining the objectives of the enterprise and revising the objectives in the light of changed circumstances. 2) Developing an organization including efficient relations with subordinates and all employees. 3) Securing adequate finance. 4) The requisition of efficient technological equipment. 5) Developing a market for the products and devising new products to meet customers demand. 6) Maintaining good relations with public authorities and with society.

Role of Entrepreneurs in the Economic Development

1. Employment opportunities: Entrepreneurs employ labour for managing their business activities and provides employment opportunities to a large number of people. They remove unemployment problem. 2. Balanced Regional Development: Government promotes decentralized development of industries as most of the incentives are granted for establishing industries in backward and rural areas. Thus, the entrepreneurs to avail the benefits establish industries in backward and rural areas They remove regional disparities and bring balanced regional development. They also help to reduce the problems of congestion, slums, sanitation and pollution in cities by providing employment and income to people living in rural areas. They help in improving the standard of living of the people residing in suburban and rural areas. 3. Mobilization of Local Resources : Entrepreneurs help to mobilize and utilize local resources like small savings and talents of relatives and friends, which might otherwise remain idle and unutilized. Thus they help in effective utilization of resources. 4. Optimization of Capital: Entrepreneurs aim to get quick return on investment. They act as a stabilizing force by providing high output capital ratio as well as high employment capital ratio. 5. Promotion of Exports : Entrepreneurs reduce the pressure on the country’s balance of payments by exporting their goods they earn valuable foreign exchange through exports. 6. Consumer Demands: Entrepreneurs produce a wide range of products required by consumers. They meet the demand of the consumers without creating a shortage for goods. 7. Social Advantage : Entrepreneurs help in the development of the society by providing employment to people and paves for independent living. They encourage democracy and self-governance. They are adept in distributing national income in more efficient and equitable manner among the various participants of the society.

8. Increase Per Capita Income : Entrepreneurs help to increase the per capita income of the country in various ways and facilitate development of backward areas and weaker sections of the society. 9. Capital formation : A country can attain economic development only when there is more amount of investment and production. Entrepreneurs help in channelizing their savings and savings of the public to productive resources by establishing enterprises. They promote capital formation by channelizing the savings of public to productive resources. 10. Growth of capital market : Entrepreneurs raises money for running their business through shares and debentures. Trading of shares and debentures by the public with the help of financial services sector leads to capital market growth. 11. Growth of infrastructure : The infrastructure development of any country determines the economic development of a country, Entrepreneurs by establishing their enterprises in rural and backward areas influence the government to develop the infrastructure of those areas. 12. Development of Trader : Entrepreneurs play an important role in the promotion of domestic trade and foreign trade. They avail assistance from various financial institutions in the form of cash credit, trade credit, overdraft, short term loans, secured loans and unsecured loans and lead to the development of the trade in the country. 13. Economic Integration: Entrepreneur reduces the concentration of power in a few hands by creating employment opportunities and through equitable distribution of income. Entrepreneurs promote economic integration in the country by adopting certain economic policies and laws framed by the government. They help in removing the disparity between the rich and the poor by adopting the rules and regulation framed by the government for the effective functioning of business in the country. 14. Inflow of Foreign Capital : Entrepreneurs help to attract funds from individuals and institutions residing in foreign countries for their businesses.

Factor Affecting Entrepreneurial Growth There are various impediments in the growth of entrepreneurship development, like lack of viable concept, lack of market familiarity, lack of Technical skill, lack of business knowledge, lack of seed capital, lack of self satisfaction, and motivations, social evils, lack of jobs, pressures of time and attention towards other sides, legal obstacles, monopoly, etc., In India , various efforts have been made, after independence for entrepreneurship development, both at Government and non-government levels, which includes industrial policy, commercial policy, Licensing Policy, Globalisation, and simplification, etc.,

Following are the key factors affecting entrepreneurship growth in India:

1. Economic Factors:

The economic factors effecting the growth of entrepreneurs in under developed countries are-

i. Non-Availability of Capital: To expand the business and grow in future research and development has to be conducted. To conduct a research either equipments have to be purchased or get exported from other developed countries, for this huge capital is required. Thus the non-availability of huge capital effects the growth of entrepreneurship in the country.

4. Psychological and Sociological Factors: According to Mc Clelland, “need achievement motive induces entrepreneurship”.

According to Paul Wilken, “entrepreneurship becomes the link between need achievement and economic growth”.

Cole states that, “besides wealth, prestige, entrepreneurs seek power, security and serve the society”.

Rostow had conducted research on inter-generation changes in the entrepreneurial families and found that, the first generation believes in seeking wealth, the second generation in prestige and third generation in art and beauty.

On the basis of motives, Evens has distinguished three kinds of entrepreneurs:

i. Chief motive of managing entrepreneurs is security.

ii. Chief motive of innovating entrepreneurs is excitement,

iii. Chief motive of controlling entrepreneurs are power and authority.

Thus many psychological and sociological factors affect the growth of entrepreneurs.

5. Cultural Factors: If the cultural factors prevailing in the country does not attach great value to business talents, industrial leadership etc., then entrepreneurs, people may not prefer to start up a new venture. Thus entrepreneurship is not developed.

Entrepreneurship In the words of Stevenson and others, “Entrepreneurship is the process of creating value by bringing together a unique package of resources to exploit an opportunity.” According to A.H. Cole, “Entrepreneurship is the purposeful activities of an individual or a group of associated individuals undertaken to initiate, maintain or organize a profit oriented business unit for the production or distribution of economic goods and services”.

All activities undertaken by an entrepreneur to bring a business unit into existence are collectively known as entrepreneurship. It is the process of changing ideas into commercial opportunities and creating values. In short, entrepreneurship is the process of creating a business enterprise.

Meaning The entrepreneur is defined as someone who has the ability and desire to establish, administer and succeed in a startup venture along with risk entitled to it, to make profits. The best example of entrepreneurship is the starting of a new business venture. The entrepreneurs are often known as a source of new ideas or innovators, and bring new ideas in the market by replacing old with a new invention.

It can be classified into small or home business to multinational companies. In economics, the profits that an entrepreneur makes is with a combination of land, natural resources, labour and capital.

In a nutshell, anyone who has the will and determination to start a new company and deals with all the risks that go with it can become an Entrepreneur.

Definition Founder and CEO of NeuroFlow Christopher Molaro says, “Entrepreneurship means being the one that is willing to take a leap, work hard enough to sacrifice everything else around you, all in the name of solving problems because no one else is capable or possesses the desire.”

Nicole Faith, Founder of 10 Carat Creations, breaks it down: “Being an entrepreneur means having a plan and vision but still succeeding or trying to succeed when the plan falls apart and you’re left with only your vision. It also means knowing when to give up, especially if your idea isn’t working due to forces outside of yourself.”

Entrepreneur vs Intrapreneur As both entrepreneur and intrapreneur share similar qualities like conviction, creativity, zeal and insight, the two are used interchangeably. However, the two are different, as an entrepreneur is a person who takes a considerable amount of risk to own and operate the business, with an aim of earning returns and rewards, from that business. He is the most important person who envisions new opportunities, products, techniques and business lines and coordinates all the activities to make them real.

On the contrary, an intrapreneur is an employee of the organization who is paid remuneration according to the success of the business unit, for which he/she is hired or responsible.

The primary difference between an entrepreneur and intrapreneur is that the former refers to a person who starts his own business with a new idea or concept, the latter represents an employee who promotes innovation within the limits of the organization.

Basis for Comparison Entrepreneur Intrapreneur

Meaning

Entrepreneur refers to a person who set up his own business with a new idea or concept.

Intrapreneur refers to an employee of the organization who is in charge of undertaking innovations in product, service, process etc. Approach Intuitive Restorative

Resources Uses own resources. Use resources provided by the company. Capital Raised by him. Financed by the company. Enterprise Newly established An existing one Dependency Independent Dependent

Risk Borne by the entrepreneur himself. Taken by the company.

Works for Creating a leading position in the market.

Change and renew the existing organizational system and culture.

Women Entrepreneurs Of late entrepreneurship amongst women has become a topic of concern for all of us. Since women constitute nearly fifty percent of the total population of our country, it is necessary they play a positive and constructive role in the socio-economic development of the country. After

and other Training programmes, promotion of rural non-farm enterprise, women ventures etc.

3. NABARD : NABARD as an apex institution guides and assists commercial banks in paying special attention to women beneficiaries while financing. It has also been providing refinance to commercial banks so as to help the latter institutions to supplement their resources which could be deployed for the purpose of financing women beneficiaries. 4. INDUSTRIAL POLICY : The new Industrial policy of Government has specially highlighted the need for conducting special entrepreneurship programme for women. 5. INSTITUTIONS AND VOLUNTARY ASSOCIATION : Several voluntary agencies like FICCI Ladies Organization (FLO), National Alliance of Young Entrepreneurs (NAYE) and others assist women entrepreneurs.

NAYE has been a leading institution engaged in the promotion and development of entrepreneurship among women. It convened a conference of women entrepreneurs in November 1975. It assists the women entrepreneurs in:

(a) Getting better access to capital, infrastructure and markets.

(b) Identifying investment opportunities.

(c) Developing managerial and productive capabilities.

(d) Attending to problems by taking up individual cases with appropriate authorities.

(e) Sponsoring participation in trade fairs, exhibitions, special conference etc.

6. NATIONAL POLICY FOR THE EMPOWERMENT OF WOMEN, 2001: As to the commitments made by India during the Fourth World Conference on women held in Beijing during September, 1995, the Department of women and children has drafted a national policy for the empowerment of women. This is meant to enhance the status of women in all walks of life at par with men.

Assistance to Women Entrepreneurs Entrepreneurship does not differentiate the sex. A number of facilities and assistance are offered to the entrepreneurs. However, certain additional incentives or facilities offered to women entrepreneurs are discussed as follows.

1. SMALL INDUSTRIAL DEVELOPMENT ORGANISATION (SIDO) : SIDO through a network of SISIs conduct the EDPs exclusively for women entrepreneurs. The aim is to develop entrepreneurial traits and qualities among women and enable them to identify entrepreneurial opportunities etc.
2. NATIONAL SMALL INDUSTRIES CORPORATION (NSIC): The H.P. scheme of NSIC provides preferential treatment to women entrepreneurs. It also conducts Entrepreneurs and Enterprise Building programmes for women.
3. INDUSTRIAL DEVELOPMENT BANK OF INDIA (IDBI) : The schemes of IDBI for women entrepreneurs are summarized as follows:

Promoter’s Contribution: The IDBI set up the Mahila Udyan Nidhi (MUN) and Mahila Vikas Nidhi (MVN) schemes to help women entrepreneurs. IDBI conduct programmes of training and extension services through designated approved agencies and association with other development agencies like EDII, TCOs, KVIC etc.

4. SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA (SIDBI): SIDBI has special schemes for financial assistance to women entrepreneurs. It provides training and extension services. It gives financial assistance at concessional terms in setting up tiny and small units.
5. COMMERCIAL BANKS : The “Sthree Shakthi Package Scheme” of SBI provides a package of assistance to women entrepreneurs. The consultancy wings of SBI give guidance on project identification and project viability. The program of assistance such as repair and servicing, photo copying, dry cleaning, retail trade business enterprises, poultry farming, tailoring etc. The Bank Of India has introduced a scheme known as ‘Priyadarshini Yojana’ to help women entrepreneurs.
6. KUDUMBASREE UNITS: With the objectives of poverty eradication and women empowerment Kudumbasree has been introduced in Kerala. The poor women are organised into community- based organisations. They start and operate micro enterprise. They earn income through self-employment.

Problems of Women Entrepreneurs The basic problem of a woman entrepreneur is that she is a woman. Women entrepreneurs face two sets of problems specific to women entrepreneurs. These are summarized as follows.

1. Shortage of Finance : Women and small entrepreneurs always suffer from inadequate fixed and working capital. Owing to lack of confidence in women’s ability, male members in the family do not like to risk their capital in ventures run by women. Banks have also taken negative attitude while lending to women entrepreneurs. Thus women entrepreneurs rely often on personal saving and loans from family and friends.
2. Shortage of Raw Material: Women entrepreneurs find it difficult to procur e material and other necessary inputs. The prices of many raw materials are quite high.
3. Inadequate Marketing Facilities: Most of the women entrepreneurs depend on intermediaries for marketing their products. It is very difficult for the women entrepreneurs to explore the market and to make their product popular. For women, market is a ‘chakravyuh’.
4. Keen Competition : Women entrepreneurs face tough competition from male entrepreneurs and also from organized industries. They cannot afford to spend large sums of advertisement.
5. High Cost of Production : High prices of material, low productivity. Under utilisation of capacity etc. account for high cost of production. The government assistance and subsidies would not be sufficient for the survival.
6. Family Responsibilities : Management of family may be more complicated than the management of the business. Hence she cannot put her full involvement in the business. Occupational backgrounds of the family and education level of husband has a direct impact on the development of women entrepreneurship.

Entrepreneurial Development Programmes – EDP Introduction Entrepreneurship development depends upon the prevailing economic system. The existing socio-political set up and the prevailing economic policies of the Government determine the economic system. The entrepreneurship development is mainly due to the existence of such economic system. It is the entrepreneurship development that acts as a filip to new, structure of the economy and economic reforms too. The economic system differs from country to country and hence the process of entrepreneurship development differs.

The mixed economic system has been found in existence in all developing countries including India. Under this system both the Government and individual entrepreneurs play an equal role in the entrepreneurship development. The government undertakes those activities which are vital for further economic advancement.

In a mixed economy though there are ample opportunities for the entrepreneurship development with the help of the Government support, entrepreneurship development is hindered by the deep rooted evils like religious conflicts, political instability and unethical practices like smuggling, corruption and adulteration.

Objectives / Importance of Entrepreneurship Development The need for entrepreneurship development was not felt by the classical economists like Adam Smith and David Ricardo. They thought that capital formation led to economic development.

But according to Schumpeter, the rate of economic growth depends upon the number of innovations introduced by the entrepreneurs and the extent with which the financial institutions come forward to finance the new venture businesses which are associated with high risks. He considered the fact that, the prevailing entrepreneurship development determines the economic growth and innovation itself is of no use unless it is made available to the public through new product and the activities involved in such processes are called as ‘entrepreneurship’.

According to him innovative entrepreneurs are essential for industrialisation, though imitative entrepreneurs are also equally playing their role in industrialisation. Japan is the best example for industrialisation with the imitative entrepreneurs.

The entrepreneurship development is needed on the following grounds

1. Optimum Utilisation of Resources

Natural resources are getting depleted over a period of time. Some of the resources are almost scarce and it is the responsibility of the entrepreneurs to identify the alternative sources of supply of resources and also to make use of the existing resources without doing much harm to the environment.

2. Improved Standard of Living

The living conditions of the people could be improved through planned entrepreneurship development programme. Entrepreneurs use the latest technology and manufacture those products which are essential to all people at the lowest cost and thereby try to improve the living standar4 of the people.

3. Ensure Industrialisation

A country is said to be advanced if there is an existence of adequate industrial units of big and small in size. The existing entrepreneurship development programmes create a congenial atmosphere for the aspiring and young entrepreneurs to come forward to set up industrial units especially in the industrially backward regions.

4. Innovation is the gateway

Innovation takes place in all fields activities. The application of computers enable businessmen and Government to expedite their business activities. Marked improvement has been taken place in the filed of communication due to the application of innovative technology.

5. Allow Global Market Entry

Entrepreneurship’ development enables the manufactures to manufacture products of international quality and thereby try to enter into the global market and compete with the products of other nations.

Pre-requisites for Entrepreneurship Development Development does not mean the setting up of large scale industrial units. The settings up of a small scale industrial unit also play an equivalent role in the economic development.

1. Incubator Facilities

‘Incubators’ have been used in U.S.A. to develop entrepreneurs for small scale industries. It enables them to I translate their laboratory research into commercial products and thereby help consumers to enjoy the benefits of the recently found technology. Venture capital financing firms in these days come forward to provide incubator facilities to the entrepreneurs.

These firms select viable projects and extend not only their financial. Assistance’ but also their managerial and marketing experiences so as to enable them to stand on their own legs.

2. Linkage of Research and Development

Entrepreneurship development depends upon a perfect linkage between the entrepreneurs and Research and Development institutions. The very objective of setting up of Science Park is to enable the entrepreneurs’ to acquaint themselves with the latest research developments. It helps them to establish suitable small: scale industries and thereby improve the economic standard.

3. Cultural Behaviours

The existing cultural value is such that entrepreneurs find it: difficult to change the living style of the people. There is a wide gap between the educated and the uneducated, rural masses and urban masses, indigeneous method of production and industrial; method of production and the like. Because of these variation the: entrepreneurship development is said to be sluggish.

4. Cumbersome Formalities

Entrepreneurial growth is affected by:

 Strict Government’s control on prices.  Foreign competition.  Poor infrastructure.  Inadequate training facilities including education and  Cumbersome formalities to be fulfilled at the time of setting up of industrial units.