Evolution of Entrepreneurs in the Indian aviation

industry and factors affecting their sustenance :

A study of entrepreneurs in Aviation maintenance
and Air Charter business.

Dissertation Submitted to the

Padmashree Dr. D. Y. Patil Universitys,
Department of Business Management
in partial fulfillment of requirements for the award of the Degree of

DOCTOR OF PHILOSOPHY
IN
BUSINESS MANAGEMENT

Submitted by :
PRAVEEN KUMAR SRIVASTAVA
(Enrollment No. DYP-PhD-066100027)

Research Guide
Dr. PRADIP MANJREKAR
PROFESSOR

PADMASHREE DR. D.Y. PATIL UNIVERSITYs,

DEPARTMENT OF BUSINESS MANAGEMENT,
Sector 4, Plot No. 10,
CBD Belapur, Navi Mumbai 400 614

December 2010

i
 Evolution of Entrepreneurs in the
Indian aviation industry and
factors affecting their sustenance :

A study of entrepreneurs in Independent

Aviation maintenance and Air Charter
business.

ii
 DECLARATION

I hereby declare that the dissertation entitled Evolution of

Entrepreneurs in the Indian aviation industry and factors affecting

their sustenance : A study of entrepreneurs in Aviation

maintenance and Air Charter business. submitted for the Award of the

Degree of Doctor of Philosophy in Business Management at the Padmashree

Dr. D.Y. Patil University Department of Business Management is my original

work and the dissertation has not formed the basis for the award of any

degree, associate ship, fellowship or any other similar titles.

Place: Navi Mumbai.

Date:

(Praveen Kumar Srivastava)

Signature of the Candidate

iii
 CERTIFICATE

This is to certify that the dissertation entitled Evolution of Entrepreneurs

in the Indian aviation industry and factors affecting their

sustenance : A study of entrepreneurs in Aviation maintenance

and Air Charter business. is a bona fide research research work carried

out by Mr. Praveen Kumar Srivastava, student of Doctorate in Philosophy

(Business Management), at Padmashree Dr. D. Y. Patil Universitys

Department of Business Management during the year 2007-2010, in partial

fulfillment of the requirements for the award of the Degree of Doctor of

Philosophy in Business Management and that the dissertation has not

formed the basis for the award previously of any degree, diploma, associate

ship, fellowship or any other similar title of any University or Institution.

Prof. Dr. Pradip Manjrekar Prof. Dr. R. Gopal

Signature of the Research guide Director
Dept. of Business Mgmt.
Padamshree Dr. D.Y. Patil
University

Place: Navi Mumbai

Date:

iv
 Acknowledgement

I am indebted to the Padmashree Dr. D.Y.Patil University Department of

Business Management, which has accepted me for Doctorate program and

provided me with an excellent opportunity to carry out the present research

project.

Regardless of the extent of a researchers effort, the accomplishment of a

dissertion of this nature is greatly dependent upon the expert guidance,

understanding and patience of the guide. My guide Dr. Pradip Manjrekar

deserves considerable credit for the academic quality of this study. I am

thankful to Dr. Pradip Manjrekar who has been my primary advisor, guide

and mentor; and has inspired and encouraged me to write this dissertation.

Special recognition must be made to Prof. Dr. R. Gopal, Director, Dean and

Head of the Department, Padmashree Dr. D.Y. Patil University, Department

of Business Management, whose expert guidance was clearly beyond

expectations and indicative of his high level of knowledge and

professionalism.

Most of all my gratitude is extended to my family, specially my wife Mrs.

Neelika P. Srivastava, without whose support, I could not have undertaken

this endeavor.

(Praveen Kumar Srivastava)

Signature of the Candidate

v
 TABLE OF CONTENTS

Page No.
List of abbreviations viii
List of figures ix
List of tables .. x
Executive Summary ..... xvi

CHAPTER I : INTRODUCTION
1.1 General Introduction . 2
1.2 Entrepreneurship A journey full of challenges ..... 5
1.3 The common challenges faced by entrepreneurs 10
1.4 Aviation industry in India An overview 21
1.5 Aviation maintenance in India Industry overview . 29
1.6 Air charter business in India Industry overview 40

CHAPTER II : LITERATURE REVIEW

2.1 Literature review ....... 50
2.2 Entrepreneurial success and failures in aviation industry ... 51
2.3 Charter Airlines Have they the future .. 53
2.4 Entrepreneurial policies and strategies .. 53
2.5 First generation entrepreneurs build the Chinese market ... 54
2.6 Entrepreneurial opportunity identification ... 56
2.7 The Indian Aviation industry 2008 ... 60
2.8 Research Gap . 61

CHAPTER III : OBJECTIVES OF RESEARCH

3.1 Research problem . 64
3.2 Statement of research objectives 66
3.3 Hypothesis ... 67
3.4 Importance of the research 70

CHAPTER IV : RESEARCH METHODOLOGY

4.1 Instrument development and measures .. 72
4.2 Pilot test .... 77

vi
4.3 Validity .. 80
4.4 Reliability .. 83
4.5 Sample design . 84
4.6 Sample size .. 85
4.7 Data collection and measure to reduce sample bias . 86
4.8 Data processing and Analysis 86
4.9 Limitations of research 89

CHAPTER V : EVOLUTION OF ENTREPRENEURS IN INDIA

5.1 Evolutionary phases .. 92
5.2 Evolution of Entrepreneurs in Independent MRO . 96
5.3 Evolution of Entrepreneurs in Air Charter sector .. 100

CHAPTER VI : DATA ANALYSIS AND HYPOTHESIS TESTING

6.1 Description of the sample . 108
6.2 Motivational factors of entrepreneurs . 118
6.3 Entry barriers faced by entrepreneurs 136
6.4 Evolutionary factors ... 146
6.5 Challenges faced in Sustenance . 156
6.6 Rewards ... 176
6.7 Results of Hypothesis testing ... 183
6.8 Summary of Hypothesis validation 204
6.9 Major Findings .. 207

CHAPTER VII : CONCLUSION

7.1 Conclusions 213
7.2 Independent MRO . 221
7.3 Air Charter ... 222
7.4 Scope of future research 223

APPENDICES
1 BIBLIOGRAPHY .. 226
2 QUESTIONNAIRE . 236
3 SURVEY DATA .. 247
4 SPSS OUT PUTS .. 259

vii
 LIST OF ABBREVIATIONS

Sr. no Abbreviation Full Form

1 MRO Maintenance repair and overhaul facility

2 OEM Original Equipment manufacturer

3 TAT Turn around time

4 w.r.t With respect to

5 Forex Foreign exchange

6 DGCA Director general of civil aviation

7 LCC Low cost carrier

8 FBO Fixed base operator

9 AME Aircraft maintenance engineer

10 CMM Component maintenance manual

11 USP Unique selling proposition

12 PMA Part manufacturers approval

13 BCAS Bureau of Civil Aviation security

14 AAI Airport Authority of India

15 ROI Return on investment

16 BAAI Business Aviation Association of India

17 CAPA Center for Asia Pacific Aviation

18 ICAO International Civil Aviation organization

19 IATA The International Air Transport Association

20 FICCI Federation of Indian chamber of commerce

viii
 LIST OF FIGURES

Figures Page No.

Passenger traffic in India ... 23

Domestic market share of Airlines 27

Number of Aircrafts in India .. 33

Maintenance contracts of Airlines . 36

Population of Independent MRO and Air charter entrepreneurs ..... 85

Evolution of Independent MRO sector in India 97

Region wise share of MRO market 99

Location & Category of respondents .... 109

Age & Family background of respondents ... 110

Personal background of respondents ... 111

Initial capital and current capital of respondents .. 112

Source of funding and break-even of respondents .. 113

Current financial condition & Current ROI of respondents .. 114

ix
 LIST OF TABLES

Table No. Name of the Tab Page No.

Table 1.1 Fleet data for year 2000 - 2010 33

Table 4.1 Research measures 74

Table 4.2 Summary of internal validation methods 83

Table 4.3 Population of MRO and Air Charter entrepreneurs 85

Table 6.1 Sample Description Facts 108

Table 6.2 Significance of motivational factors in evolution of 118

Entrepreneurs

Table 6.3 Correlation analysis : Aviation as a hobby of any 120

family member or friend * Personal back ground

Table 6.4 Chi-Square test for Aviation as a hobby of any 121

family member * Personal Background

Table 6.5 Correlation analysis : Own interest in 121

Aviation * Personal back ground

Table 6.6 Chi-Square test for Own interest in 122

Aviation * Personal Background

Table 6.7 Correlation analysis : Adventurous / Craving to take 123

risk * Personal back ground

Table 6.8 Chi-Square test for Adventurous / Craving to take 124

risk * Personal Background

Table 6.9 Correlation analysis : Desire to take challenges in 125

life * Personal back ground

Table 6.10 Correlation analysis : Passion towards Aircrafts / 126

Flying * Family background

Table 6.11 Chi-Square test for Passion towards Aircrafts / 127

Flying * Family background

Table 6.12 Correlation analysis : Being your own master * Family 128
Background

Table 6.13 Correlation analysis : Being your own master * Personal 129
Background

x
Table 6.14 Correlation analysis : Follow your dream * Family 130
Background

Table 6.15 Correlation analysis : Follow your dream * Personal 131

Background

Table 6.16 Correlation analysis : Money * Family background 132

Table 6.17 Correlation analysis : Money * Personal background 133

Table 6.18 Correlation analysis : Glamour * Family background 134

Table 6.19 Correlation analysis : Glamour * Personal background 135

Table 6.20 Entry barriers in the evolution of entrepreneurs 136

Table 6.21 Correlation analysis : Difficulty in getting Permissions / 137

Approvals * Motivation

Table 6.22 Correlation analysis : Difficulty in getting Permissions / 138

Approvals * Evolution

Table 6.23 Correlation analysis : Infrastructural 139

constraints * Motivation

Table 6.24 Correlation analysis : Infrastructural 140

constraints * Evolution

Table 6.25 Correlation analysis : Capital intensive * Motivation 141

Table 6.26 Correlation analysis : Capital intensive * Evolution 141

Table 6.27 Correlation analysis : Control of OEM * Motivation 142

Table 6.28 Chi-Square tests : Control of OEM * Motivation 143

Table 6.29 Correlation analysis : Control of OEM * Evolution 144

Table 6.30 Chi-Square tests : Control of OEM * Evolution 144

Table 6.31 Correlation analysis : Unavailability of data * Evolution 145

Table 6.32 Chi-Square tests : Unavailability of data * Evolution 146

Table 6.33 Factors significant to the evolution of entrepreneurs 146

Table 6.34 Correlation analysis : Industry need based * Motivation 148

Table 6.35 Chi-Square tests : Industry need based * Motivation 149

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Table 6.36 Correlation analysis : Industry need based * Challenges 149
faced in sustenance

Table 6.37 Chi-Square tests : Industry need based * Challenges 150

faced in sustenance

Table 6.38 Correlation analysis : Opportunity based * Motivation 150

Table 6.39 Correlation analysis : Opportunity based * Challenges 151

faced in sustenance

Table 6.40 Chi-Square tests : Opportunity based * Challenges 152

faced in sustenance

Table 6.41 Correlation analysis : Idea based * Motivation 152

Table 6.42 Correlation analysis : Idea based * Challenges faced 153

in sustenance

Table 6.43 Correlation analysis : Foresight / Vision * Motivation 154

Table 6.44 Chi-Square tests : Foresight / Vision * Motivation 155

Table 6.45 Correlation analysis : Foresight / Vision * Challenges 155

faced in sustenance

Table 6.46 Significance of Challenges faced in sustenance 156

Table 6.47 Correlation analysis : Regulatory controls * Motivation 158

Table 6.48 Chi-Square tests : Regulatory controls * Motivation 159

Table 6.49 Correlation analysis : Regulatory controls * Rewards 159

Table 6.50 Chi-Square tests : Regulatory controls * Rewards 160

Table 6.51 Correlation analysis : High cost of operation * Motivation 161

Table 6.52 Chi-Square tests : High cost of operation * Motivation 162

Table 6.53 Correlation analysis : High cost of operation * Rewards 162

Table 6.54 Chi-Square tests : High cost of operation * Rewards 162

Table 6.55 Correlation analysis : Availability of spares * Motivation 163

Table 6.56 Chi-Square tests : Availability of spares * Motivation 164

Table 6.57 Correlation analysis : Availability of spares * Rewards 164

xii
Table 6.58 Chi-Square tests : Availability of spares * Rewards 165

Table 6.59 Correlation analysis : Difficulty retaining Skilled man 166

power * Motivation

Table 6.60 Chi-Square tests : Difficulty retaining Skilled man 166

power * Motivation

Table 6.61 Correlation analysis : Difficulty retaining Skilled man 167

power * Rewards

Table 6.62 Chi-Square tests : Difficulty retaining Skilled man 168

power * Rewards

Table 6.63 Correlation analysis : Control of OEM * Motivation 169

Table 6.64 Chi-Square tests : Control of OEM * Motivation 169

Table 6.65 Correlation analysis : Control of OEM * Reward 170

Table 6.66 Chi-Square tests : Control of OEM * Reward 171

Table 6.67 Correlation analysis : Effect of market 172

fluctuations * Motivation

Table 6.68 Chi-Square tests : Effect of market 172

fluctuations * Motivation

Table 6.69 Correlation analysis : Effect of market 173

fluctuations * Rewards

Table 6.70 Chi-Square tests : Effect of market 173

fluctuations * Rewards

Table 6.71 Correlation analysis : Problem managing cash 174

flow * Motivation

Table 6.72 Chi-Square tests : Problem managing cash 175

flow * Motivation

Table 6.73 Correlation analysis : Problem managing cash 175

flow * Rewards

Table 6.74 Chi-Square tests : Problem managing cash 176

flow * Rewards

Table 6.75 Significance of Rewards to the Entrepreneur 176

Table 6.76 Correlation analysis : Monetary / Financial * Motivation 178

xiii
Table 6.77 Chi-Square tests : Monetary / Financial * Motivation 178

Table 6.78 Correlation analysis : Recognition in the 179

Industry * Motivation

Table 6.79 Chi-Square tests : Recognition in the 180

Industry * Motivation

Table 6.80 Correlation analysis : Satisfaction of being an 181

employer * Motivation

Table 6.81 Chi-Square tests : Satisfaction of being an 181

employer * Motivation

Table 6.82 Correlation analysis : Job satisfaction * Motivation 182

Table 6.83 Chi-Square tests : Job satisfaction * Motivation 182

Table 6.84 Cross tabulation : Family 183

Background * Motivation category

Table 6.85 Chi-Square Tests : Family 184

Background * Motivation category

Table 6.86 Cross tabulation : Current Financial 185

condition * Motivation category

Table 6.87 Chi-Square Tests : Current Financial 186

condition * Motivation category

Table 6.88 Cross tabulation : Evolution * Motivation 187

Table 6.89 Chi-Square Tests : Evolution * Motivation 188

Table 6.90 Cross tabulation : Source of funding * Entry barriers 189

Table 6.91 Chi-Square Tests : Source of funding * Entry barriers 190

Table 6.92 Cross tabulation : Initial Capital * Entry Barrier 191

Table 6.93 Chi-Square tests : Initial Capital * Entry Barrier 192

Table 6.94 Cross tabulation : Break-even period * Entry Barrier 192

Table 6.95 Chi-Square tests : Break-even period * Entry Barrier 192

Table 6.96 Cross tabulation : Innovative Idea based * Evolution 194

Table 6.97 Chi-Square tests : Innovative Idea based * Evolution 194

xiv
Table 6.98 Cross tabulation : Industry need based * Evolution 195

Table 6.99 Chi-Square tests : Industry need based * Evolution 196

Table 6.100 Cross tabulation : Regulatory norms * Sustenance 197

Table 6.101 Chi-Square tests : Regulatory norms * Sustenance 198

Table 6.102 Cross tabulation : Capital Intensive * Sustenance 199

Table 6.103 Chi-Square tests : Capital Intensive * Sustenance 199

Table 6.104 Cross tabulation : Glamour * Rewards 201

Table 6.105 Chi-Square tests : Glamour * Rewards 201

Table 6.106 Cross tabulation : Rewards * Motivation 202

Table 6.107 Chi-Square tests : Rewards * Motivation 203

Table 6.108 Summary of Hypothesis Validation 204

Table 7.1 Summary Pearson correlation test 214

xv
 EXECUTIVE SUMMARY

Since the airline deregulation took place in the year 1994, a new business

model has emerged in the Indian aviation industry. It has caused a shift in

the way people travel within India. With the launch of private airlines and

increase in number of Aircrafts, the need for aviation maintenance has

increased. Also the Low cost carrier model of commercial aviation has

opened up avenues for third party independent maintenance, repair and

overhaul facilities (MRO). The low cost carrier business model includes only

line maintenance to be done in-house and all other maintenance jobs are

outsourced to the Independent MROs. As the aircrafts get older, the need for

maintenance would increase, thus creating opportunities for entrepreneurs to

enter into Independent aviation maintenance business. The competition

amongst the airlines and charter operators, has forced these operators to

consider cost cutting measures. Maintenance being one of the major cost in

the total operation of an Aircraft, local or nearby MROs would be preferred to

save the aircraft ferrying, crew and fuel costs.

The deregulation also opened up the skies for small business jets to fly

across the length and breath of the country, which created opportunities for

Air Charter business in India. With the emergence of rich business class in

last 2 decades, air charter has seen steady demand and business travel has

shifted from flying by commercial airlines to traveling by private jets.

Traveling by Charter or Private aircraft, not only gives luxury and privacy, but

also saves time and effort. The upcoming successful businessmen prefer to

xvi
hire a charter plane than owning one, due to the regulatory and operational

hassles involved in it. It also gives them the flexibility of hiring different types

of charter planes as per their travel needs and the airports at which they

intend to land.

In light of the growth in aviation industry, specifically in the MRO and Air

charter sectors, this study becomes important due to the fact that people are

traveling more frequently and wish to do so quicker and more efficiently. With

businesses growing faster than before, the need for Air Charter is increasing

day by day and hence a study of the evolution and challenges faced by the

entrepreneurs engaged in Air Charter would add value to the industry.

The challenges faced by MROs which is a limiting factor in the growth of this

sector, would create a problem for the Airlines in the near future. According

to the Industry sources 85% of the aviation maintenance is still outsourced to

the US and Europe or their subsidiaries out side India. Hence a study was

past due in the area of aviation MRO, to evaluate the challenges, which if

addressed at the industry level could give impetus to the development of this

sector.

The objective of this research is to study the evolution of entrepreneurs in

Aviation maintenance and Air Charter businesses to draw the pattern of

growth, basis on which references can be made for future growth in these

two sectors. This research also looks at whether or not the challenges faced

by entrepreneurs is effecting the over all growth in these two sectors. A study

xvii
of both external as well as internal industry challenges faced by the

entrepreneurs has been made and analyzed through statistical methods.

Investment, Regulatory, Control by the manufacturers, human and technical

challenges have been investigated.

This study has sought to identify the major factors, which affected the

evolution of entrepreneurs in these two sectors. On the basis of factors which

affected the evolution of entrepreneurs, an endeavor has been made to study

the impact of these evolutionary factors on the sustenance of entrepreneurs.

The method chosen for this study was of an integrated approach based on

both the primary and secondary data. Due to the limited sample size in these

two sectors of Indian aviation industry, each entrepreneur was individually

met and interviewed to obtain first hand information. A literature survey

coupled with a comparative analysis has also been done. The data obtain

after interview was analyzed through SPSS and validation of Hypothesis

tested through statistical methods.

Dramatic change has occurred in the Indian Aviation industry in last 10

years. Competition is increasing not only between airlines but also between

Independent MROs and Air charter operators. With the competition going to

increase in the future, entrepreneurs will have to redesign their business

models to keep afloat. While the Indian aviation industry is still in its growth

stage, there are several challenges related to infrastructure, technology and

xviii
human resources, which if not addressed immediately, would eclipse the

growth of aviation industry in India.

The study of evolution of entrepreneurs in MRO reveals that the growth in

last one decade has been slow in comparison to the overall increase in the

traffic and passenger load. Independent MRO sector is still getting organized,

when there is an immediate need for it to scale up. There are several

opportunities in this sector, however due the challenges faced by

entrepreneurs, not much investment is being made in MRO sector. The entry

barriers, long gestation period, not enough reward / return on investment and

multiple challenges faced by the entrepreneurs in sustenance is keeping

away new entrepreneurs to enter into Independent MRO business.

Reports show a growth of 18% PA in the Indian aviation industry and

passenger load of upto 100 million by end of 2010. With such high growth

Airlines will continue to lose revenue due to high cost of maintenance and

outsourcing of repair jobs out side India.

Findings of this research show that not enough is being done to attract

entrepreneurs in Independent aviation maintenance sector. The evolution in

this sector has been slow and entrepreneurs are facing constant challenges

to sustain.

In the Air charter sector findings of this research show that entrepreneurs

who entered into Air Charter business in last 5-6 years are now realizing that

xix
their business is not making profit and hence they have to restructure their

business model very frequently. The regular customers who fly Charter

Aircrafts for more than 200 hours in a year, prefer to buy their own private

jets, considering the total spending done by them in flying Charter Aircrafts in

a year. Air charter business is facing challenges in sustenance due to the

high cost of operation, infrastructural limitations and regulatory issues.

Air charter business has different set of challenges, because of the

regulatory restrictions at most of the airports, like no permission to land

during peak hours, unavailability of night landing facility, runway limitations,

unavailability of trained pilots locally etc. This study has made an attempt to

know the motivating factors for entrepreneurs to enter into Air charter

business inspite of several challenges being faced at the industry level.

This study reveals some interesting facts, which show that non of the Air

Charter companies in India have ever made profit and continue to operate as

a support to their parent companies which have used them for internal travel

purpose. Many entrepreneurs entered the Air charter business due to the

glamour attached with this industry, only to realize later that Air Charter is not

a profitable business. Air charter business in India can either survive as a

supporting activity to the parent company or its business model has to be

designed in a way to make private air travel affordable, only then volumes

can come from this business.

xx
This study through the statistical analysis arrives at conclusions that internal

motivation level of entrepreneurs in both MRO and Air charter business was

a major factor which helped them to sustain in their business, the external

factors like regulatory norms and funding did not had much effect on their

sustenance. However, infrastructural constraint is a major hindrance in the

over all growth of MRO as well as Air charter sectors of the aviation industry

in India.

It also concludes that the capability of an entrepreneur to overcome the entry

barriers had correlation with the internal motivation level of the entrepreneur.

This study establishes the fact that entrepreneurs are a different breed and

have maneuvering skills to handle their business in different situations.

Conclusions show that entrepreneurs did not evolve due to the industry

needs but they were more idea based and grabbed the opportunities through

their vision and foresight, they also maneuvered to sustain in business

despite all the inherent challenges of these two sectors.

xxi
 CHAPTER I

INTRODUCTION

1
 CHAPTER I

INTRODUCTION

Evolution of Entrepreneurs in the Indian aviation industry and factors

affecting their sustenance : A study of entrepreneurs in Aviation

maintenance and Air Charter business, is the study to understand the

facts like family back ground, source of funding, effect of various factors like

motivations, entry barriers, challenges, entrepreneurial traits and

characteristics which played important role in the evolution of Entrepreneurs

in the Indian aviation industry.

During the last two decades, the commercial aviation industry in India has

seen multifold growth due to the increase in number of people traveling by air

and thus has given rise to the need of more aircraft maintenance. The

corporate or business flying has also seen phenomenal growth, as the

business houses have grown and first generation entrepreneurs have

created wealth with the growth in economy.

The overall growth in Commercial aviation (scheduled airlines) as well as

General aviation (non Scheduled - Air Charter / business flying) has brought

in opportunities for entrepreneurs. This gave birth to entrepreneurship in

different areas of aviation industry. Since the aviation industry in India is still

in its growth stage, there is not much reference available to the

entrepreneurs who engage themselves in aviation related business. In the

2
growth stage, every industry keeps trying different business models and

hence the challenges faced by the entrepreneurs are varied. In the growth

stage business models and strategies need to be adjusted to the varying

external business environments. The business dynamics in the growth stage

is highest and thus the entrepreneurial skills are put to test during this phase.

Success of an entrepreneur depends on his / her adoptability to the changes

in external environment.

This research is an attempt to study the evolution of entrepreneurs in the

Independent aviation maintenance and Air charter segments of the aviation

industry in India and compile the information for future reference of

entrepreneurs who would like to establish their business in this industry.

As such the whole study is divided into 3 segments 1) Study of the general

and financial facts of entrepreneurs in Independent aviation MRO

(maintenance repair and overhaul facilities) and Air charter business, 2)

Study of the factors responsible for their evolution and 3) Challenges faced

by the entrepreneurs to sustain in their business dynamics of aviation

related entrepreneurship.

Entrepreneurs are innovators and the saying Need is the mother of all

innovations applies to entrepreneurship. Most entrepreneurs are born out of

need, whether it is the individual need of the entrepreneur or industry need,

where the entrepreneur taps the opportunity and converts it into a business

enterprise. This study through the survey gathers information on how

3
entrepreneurs tapped the opportunity which came along with the growth in

Indian aviation industry and what are the factors effecting their sustenance in

the same business.

Opportunity identification has increasingly been viewed as a core attribute of

entrepreneurship (Shane & Venkataraman, 2000), without which

entrepreneurship cannot take place (Singh, 1998). This dissertation also

addresses the fundamental question of entrepreneurship from a cognitive

perspective : why some people are able to identify entrepreneurial

opportunities in the aviation sector. It suggests that social networks,

information diversity, prior knowledge and entrepreneurial alertness are

necessary but not sufficient to explain the process of identifying

entrepreneurial opportunities. Whether an opportunity can be identified

necessitates congnitive processing, which refers to the mode of thinking

through connecting previously unconnected matrices or domains of

information.

Entrepreneurs are a difference breed, who drive the society, industries and

economy of countries at large. Entrepreneurs are born with fire and their fire

within becomes a forest fire as they tap the opportunity and make it big. This

study has made an attempt to evaluate the factors which act as fire within the

entrepreneurs.

It would be difficult to imagine the economy of India less Tata, Reliance and

Infosys, these being only 3 such names of successful enterprises for

4
reference purpose. Even such an imagination would bring shiver to

economists. In a similar manner there are hundreds and thousands of

entrepreneurs contributing to the economy of India, right from the milk man

who delivers milk every day morning to our homes to the auto rickshaw driver

who takes us from our home to office. They are all entrepreneurs who are

self motivated, self driven and self managed, who contribute to the economy

in their own way. No industry can growth or evolve without entrepreneurs.

Thus it becomes important to study the various factors which encourage the

entrepreneurs to start their own business. This study with its focus on

Independent Aviation Maintenance (MRO) and Air Charter business will try to

contribute to the existing literature on this subject and reference to the

industry.

Entrepreneurship A journey full of challenges :

"Entrepreneurship is the recognition and pursuit of opportunity without regard

to the resources you currently control, with confidence that you can succeed,

with the flexibility to change course as necessary, and with the will to

rebound from setbacks." An entrepreneur is a person who starts a business

to follow a vision, to make money, and to be the master of his/her own soul

(both financially and spiritually). Inherent in the venture is the risk of what the

future may bring. Therefore, an essential key to success is that the

entrepreneur also be an "educated" risk taker.

According to Muthu Kumar & Ayyapan (2003) There is no such thing as a

5
good time or bad time to start companies, all times are equally challenging.

Opportunities always exist, what is important is the attitude which one takes

to entrepreneurship. Nothing in the past that one has done can prepare one

for "chucking it all up" and becoming an entrepreneur. No management

education or theory can provide answers to the Right Way to build a

company from scratch. Many of the best of management thinkers have been

found wanting, when it came to running their own company.

The fact remains, that only 1 in 100 startups succeeds. If one were to ask

entrepreneurs about their chances of success, most would give themselves

greater than even odds, even as high as a 60-70% chance of success. The

reality though, is very different. While no one can predict success or failure, it

is important to do things right to begin with.

Successful entrepreneurs are those who have the great ability to articulate in

a passionate way what their vision is, to not just their investors, but also to

their employees and potential customers. They should understand their

limitations, wiling to be held accountable, need to be focused, tenacious and

determined to succeed. As they grow their businesses, they must learn to

enlarge their inner circles and empower their professionals for their business

to grow.

Researchers have been inconsistent in their definitions of entrepreneurship

(Brockhaus & Horwitz, 1986, Sexton & Smilor, Wortman, 1987; Gartner,

1988). Definitions have emphasized a broad range of activities including the

6
creation of organizations (Gartner, 1988), the carrying out of new

combinations (Schumpeter, 1934), the exploration of opportunities (Kirzner,

1973), the bearing of uncertainty (Knight 1921), the bringing together of

factors of production (Say, 1803), and others (See Long, 1983). The outline

below presents some authors definition of entrepreneurship and attempts to

summarize these viewpoints into a more meaningful whole.

According to Richard Cantillon (circa 1730) : Entrepreneurship is defined as

self-employment of any sort. Entrepreneurs buy at certain prices in the

present and sell at uncertain prices in the future. The entrepreneur is a

bearer of uncertainty.

As defined by Jean Baptiste Say (1816); An entrepreneur is the agent "who

unites all means of production and who finds in the value of the products, the

reestablishment of the entire capital he employs, and the value of the wages,

the interest, and rent which he pays, as well as profits belonging to himself."

According to Frank Knight (1921) he defines entrepreneurs as :

Entrepreneurs attempt to predict and act upon change within markets. Knight

emphasize the entrepreneur's role in bearing the uncertainty of market

dynamics. Entrepreneurs are required to perform such fundamental

managerial functions as direction and control.

Entrepreneurs are defined by Joseph Schumpeter (1934) as ; The

entrepreneur is the innovator who implements change within markets through

7
the carrying out of new combinations. The carrying out of new combinations

can take several forms; 1) the introduction of a new good or quality thereof,

2) the introduction of a new method of production, 3) the opening of a new

market, 4) the conquest of a new source of supply of new materials or parts,

5) the carrying out of the new organization of any industry. Schumpeter

equated entrepreneurship with the concept of innovation applied to a

business context. As such, the entrepreneur moves the market away from

equilibrium. Schumpter's definition also emphasized the combination of

resources. Yet, the managers of already established business are not

entrepreneurs to Schumpeter.

Another definition of entrepreneurship by Penrose (1963) is ; Entrepreneurial

activity involves identifying opportunities within the economic system.

Managerial capacities are different from entrepreneurial capacities

The research scholar While Harvey Leibenstein (1968, 1979) defines it as ;

the entrepreneur fills market deficiencies through input-completing activities.

Entrepreneurship involves "activities necessary to create or carry on an

enterprise where not all markets are well established or clearly defined

and/or in which relevant parts of the production function are not completely

known.

Late in the 1970s researcher Israel Kirzner (1979) has defined entrepreneurs

as ; The entrepreneur recognizes and acts upon market opportunities. The

entrepreneur is essentially an arbitrageur. In contrast to Schumpeter's

8
viewpoint, the entrepreneur moves the market toward equilibrium.

The Entrepreneurship Center at Miami University of Ohio has an interesting

definition of entrepreneurship: "Entrepreneurship is the process of identifying,

developing, and bringing a vision to life. The vision may be an innovative

idea, an opportunity, or simply a better way to do something. The end result

of this process is the creation of a new venture, formed under conditions of

risk and considerable uncertainty."

In summary, entrepreneurship is often viewed as a function which involves

the exploitation of opportunities which exist within a market. Such exploitation

is most commonly associated with the direction and/or combination of

productive inputs. Entrepreneurs usually are considered to bear risk while

pursuing opportunities, and often are associated with creative and innovative

actions. In addition, entrepreneurs undertake a managerial role in their

activities, but routine management of an ongoing operation is not considered

to be entrepreneurship. In this sense entrepreneurial activity is fleeting. An

individual may perform an entrepreneurial function in creating an

organization, but later is relegated to the role of managing it without

performing an entrepreneurial role. In this sense, many small-business

owners would not be considered to be entrepreneurs. Finally, individuals

within organizations (i.e. non-founders) can be classified as entrepreneurs

since they pursue the exploitation of opportunities. Thus intrepreneurship is

appropriately considered to be a form of entrepreneurship.

9
The Common Challenges faced by Entrepreneurs

The internet boom has brought in vast opportunities, entrepreneurs have

become one of the most dynamic forces in the economy of India.

Entrepreneurs are now driving the technology boom, which is itself driving

much of the country's economic growth. This makes entrepreneurs very

important from a macro-economic perspective. They have become a broader

economic phenomenon that has a major impact on the economy. As the

globalism of business becomes even more widespread, this impact will be

felt even more deeply. Entrepreneurs have already become a major force in

positioning India in the worldwide economy.

The scope of what entrepreneurship involves will continue to change and

evolve as India continues to change and evolve, and yet there are some

common issues of how to start a business, how to finance the business, how

to run the business that this community can share and learn from each other.

While there are many heroes and stories, entrepreneurism is an established

field with a wide range of issues at all stages of the enterprise.

A common denominator for all entrepreneurs is the challenge of starting a

business, be it through inventing something, looking for a new idea within a

business, finding the right opportunity to break into a business or buying into

a franchise. All of these take planning and organizing all the aspects so that

the entrepreneur reaches his goals. Entrepreneurs are also faced with the

challenge of financing their entrepreneurial venture. So unless the venture

comes from self funding, getting money is a challenge that requires preparing

10
funding proposals or applications to be written and presented for loans,

venture capital, angel investors or even IPO's.

It may be felt that after over coming those challenges, it would be a smooth

sailing. Given the business has a good plan, everything should proceed with

minor glitches. However, the implementation stage seems to be the real

make-or-break point of an entrepreneurial venture. More realistic, perhaps, is

that there are such a wide variety of skills needed at the implementation

stage, that no one person can have the skills to manage all the functions

well. The real talent is for entrepreneurs to recognize what they do well and

then find employees or subcontractors who can fill the gaps.

One way to look at this implementation stage is to look at how many different

skills are involved in operating a business. Operating a business involves

employees, marketing, advertising, sales, communications, public relations,

legal needs, government regulations, equipping the office, risk management,

disaster planning, crisis management, insurance, technology, hardware,

software, the internet, and the financial aspects of the company -

bookkeeping, managing debt, taxes, and funds flow.

Most businesses are built around strong technical basis. Above and beyond

this, however, is the conceptual aspect of management: ethics, leadership,

growth philosophy, and even the exit strategy of the company. These are

much less tangible, yet set the overall theme and direction that the business

will take.

11
Ken Ryan (1967), quoted that "He that is prepared has half won the battle.".

This is true for all startup entrepreneurs and studies have shown that

entrepreneurs who prepared them selves well before starting their business

were more successful. Every entrepreneur faces several challenges in his

journey to establish the enterprise. Discussions reveal that below are 10

common Business Challenges every entrepreneur faces when building a

business from scratch:

1. Developing the Vision and Idea:

This is usually the first challenge faced by every entrepreneur. Finding the

right business opportunity or creatively developing an idea is certainly not an

easy task. "Envisioning the idea" is the first true task of an entrepreneur. As

an entrepreneur, one must develop the ability to see what others cannot see.

While others see problems, an entrepreneur must see opportunities.

But seeing opportunities is just the first task. The main challenge is his ability

to forge that opportunity into a business idea. This is a business challenge

because the process of transforming opportunities into business plans is like

trying to turn lead into gold. This could be called the process of "Creating

Value out Of Nothing." Non-entrepreneurs, might not be familiar with the

process. The process of :

- Identifying a problem - Seeing an opportunity in the problem - Coming up

with a solution - Developing your opportunity into a business idea -

Integrating your solution into the business plan.

12
Another way "developing the vision and idea" will be a business challenge in

which an entrepreneur must sometimes assume the role of a sorcerer. While

others dwell in the past and present, an entrepreneur must envision and

forecast the future. An entrepreneur must always be ahead of his time or else

he might lose his relevance. He must have the ability to bring into present

what is yet to be.

In the late 70s and early 80s, while IBM saw increase in demand for their

mainframe computers, Steve Jobs envisioned a personal computer in every

home and Bill Gates envisioned the need for easy to use software for

personal computers. While everyone saw humans flying as an impossible

task, the Wright brothers envisioned a flying machine. Back in those days

when cars were custom made and exclusively for the rich, Henry Ford

envisioned affordable cars for the masses. These few examples, clearly

indicate that developing the vision and idea is the first true task of an

entrepreneur.

2. Raising Capital:

After developing idea, the next challenge faced by an entrepreneur is the

challenge of raising capital. An entrepreneur, is the only person who knows

the idea to the core. He is the only one who knows the story of the future.

Trying to convince investors about something that doesn't exist is definitely a

challenge.

There is more to raising capital than just simply asking for money. Most

investors want to invest in already established businesses with minimal risk.

13
When building a business from scratch, raising capital is definitely a business

challenge every entrepreneur must face.

To overcome this challenge, an entrepreneur must develop the ability to sell

his idea and vision to potential investors. "Sell his ideas", means improving

communication skill and manner of presentation. In the game of raising

capital, he must have a good story backed by a strong business plan.

3. Assembling a Team:

The third challenge faced by entrepreneurs in the course of developing a

business is assembling the right team. Here team does not mean regular

employees, it means a "round table strategic business team" that will meet

regularly to brainstorm on ways to grow the business.

As an entrepreneur, one is bound to have strengths and weaknesses. That is

the more reason he needs to assemble a strong team that will cover up for

his weaknesses. A team is a necessity in the quest to build a business. Now

finding a business team is just the first hurdle, transferring the passion and

vision to the team is the real piece of cake.

An entrepreneur must strive to make sure his team sees the future as he

sees it. They must believe in his possibilities and must also be passionate

about making that possibility a reality. If they can't grasp his vision, if they

can't see their future with him, then they are not worthy being in the team.

14
The strategic business team may comprise of the banker, financial advisor,

accountant, company secretary or legal adviser and any other specialist that

will be of tremendous impact to the business.

4. Finding the Right Location:

Some time an entrepreneur might feel that finding a good location is a piece

of cake but finding a good location at the right price is definitely not easy. The

following are features one must consider before choosing a location. These

features are subject to change with respect to the industry of business:

- Suitable price - Easy access to raw materials - Good road network. -

Basic amenities and infrastructures - Adequate Power supply - Easy access

to cheap labour - State and central tax benefits - Favorable Government

financial and monetary policy - Current economic policy and political

situation.

5. Finding the Right Employees:

Those who are already entrepreneurs know how difficult it is to find a

hardworking, trustworthy employee. Most employees want to work less and

get paid more. Finding a good employee who will be passionate about

delivering his or her services is quite difficult.

Employees are the representatives to customers and the outside world. They

are a reflection of business culture and ethics of the company. If an

employee is bad or rude to customers, it is going to portray a bad image of

15
the company. So one must be careful when hiring employees. There is a

golden rule followed by successful companies; "Hire slow and fire fast."

6. Finding Good Customers:

The sixth business challenge an entrepreneur faces is the challenge of

finding good customers. When in the process of building a business from

scratch, an entrepreneur will realize that there are good customers and bad

customers.

One must really be on guard for bad customers. Good customers are really

hard to find. A good customer will be loyal to the company and will be willing

to forgive if there is any mistake and one apologizes. A good customer will try

to do the right thing that will benefit both himself and the company mutually.

A bad customer will always look for loopholes in the company's policy to

exploit and make some few gains. Bad customers will always try to exploit

the company's goodwill and look for ways to rip off the company. Bad

customers are responsible for bad debts. Good customers build the business

and bad customers will always try to liquidate the business. Just as the

employees are fired, an entrepreneur must also be prepared to fire bad

customers without hesitation.

7. Overcoming Competition:

Competition is the next challenge an entrepreneur faces. Most individuals

see competition as a plague but entrepreneurs see competition as a good

challenge. They see competition as a benchmark for creativity, the main

16
engine for innovation and quality products at great prices. Without

competition, there will be no innovation and without innovation, the world will

be stagnant.

Entrepreneurs must see competition as a welcomed challenge. Competition

keeps the entrepreneurs on their toes and drives them to constantly improve

their products and services. But one must be careful, competition can make

business lose its relevance in the eye of the customers so an entrepreneur

must always be on guard.

"If you don't have a competitive advantage, don't compete." Jack Welch

8. Unforeseen Challenges and Expenses:

Just as a sailor prepares for unexpected storm, just as a pilot is always on

the watch for unpredictable bad weather and thunderstorms, so must an

entrepreneur be prepared for what ever comes. Unexpected challenges can

come in the form of:

- Unexpected legal battles - Inconsistent government policy - Not being able

to pay salaries - Unpaid bills and taxes - Unexpected resignation of staff

from sensitive positions - Bad debts from customers - Loss of market share

- Dwindling working capital - Inadequate stock or inventory

These challenges, if not handled properly can ruin the plan of an

entrepreneur to build a successful business from scratch. Another challenge

17
entrepreneurs must expect is an unforeseen increase in business expenses.

If not handled properly, it might result in constant negative cash flow and

eventually, the business failure.

9. Keeping Up With Industrial Changes and Trends:

Change in trends is really a business challenge an entrepreneur must be

prepared for. Trends have made and broken lot of businesses. There are

several examples of profitable businesses that have been wiped out by slight

industrial changes and trends. A typical example is the Dot com trend, where

many industrial based businesses were wiped out by new web based dot

com companies. When the Dot com era began, business owners were left

with only two options. Either they join the dot com train or they get crushed

by the dot com train.

Seasoned entrepreneurs know that trend is always a friend and are always

willing to swiftly adjust their business with the current trend. Keeping their

eyes open to spot trends is really a challenge but the big task will be an

entrepreneurs ability to quickly use the trend to his advantage.

10. Exiting the Business:

"In the world of business and investing, an entrepreneurs exit is more

important than his entry. A good thumb of rule is; exit before you enter." -

Robert Kiyosaki

When building a business from scratch, entrepreneurs would face the

18
business challenge of determining their exit strategy. Just as the quote above

states, the entrepreneur has to plan his exit strategy before he even starts

the business. Most entrepreneurs run their business without any plans to exit

and even if they have an exit strategy, they find it difficult to implement it.

Before starting a business, it is most appropriate to always plan the exit.

There are benchmarks one can use to determine the exit from business.

Most smart entrepreneurs use this benchmark as a target and once the

specific target is reached, they exit the business. Examples of such

benchmarks are:

- Annual sales - Annual Turnover - Asset Base - Market Saturation -

Customer base or number of users.

When it comes to exiting the business, there are three exit strategies you can

apply. The exit strategies are:

Turning over the business to professional managers: When the business

reaches a certain stage of maturity, entrepreneurs can exit by turning it over

to professional managers. In this case, the business still belongs to him but

he is not involved with its day to day affairs. The entrepreneurs give up

administrative role to assume the role of a watchdog. When the entrepreneur

exits in this manner, he will have more free time to look into other projects or

retire.

19
Selling the business privately: In this case, the entrepreneur exits the

business by selling it to a private investor. In the business world, it is called

M&A (Mergers and Acquisitions). After the sale and transfer of assets is

complete, entrepreneur has nothing to do with the business again.

Taking the company public: The unique thing about this type of exit strategy

is that while the entrepreneur is selling his business (in form of shares) to

public investors, he still owns and control the business.

The above introduction about entrepreneurship and challenges would give an

over all view of the entrepreneurial skills and various factors and stages,

which will help understand the entrepreneurial aspects of evolution and

sustenance of entrepreneurs in Independent aviation maintenance (MRO)

and Air charter business.

20
Aviation Industry in India
An Overview

The aviation industry in India is now entering a new phase of development

after two decades during which the sector has witnessed both stagnation and

unprecedented growth. The industry has experienced some of the natural

growing pains of a sunrise sector, but numerous lessons have been learned

and are being acted upon. Despite the recent growth, less than 2% of Indians

travel by air in any given year, highlighting that we have barely arrived at the

threshold of the growth potential of Indian aviation.

Recent History of Indian Aviation Industry

Pre 1993 :

Aviation was traditionally viewed as an elite activity, and one in which

socialist governments could not be seen to allocate resources. The two

government airlines Air India (long haul international) and Indian Airlines

(domestic and shorthaul international) were the only Indian carriers. Both

carriers operated with relatively old aircraft and inefficient work practices,

from airports which were functional at best. There was no focus on

developing traffic and the market grew at uninspiring single digit rates.

1993 1995 :

The first steps in domestic aviation deregulation were taken allowing private

airline entry, first as air taxis and then as scheduled operators. However, the

government was still focused on protecting the state owned carriers, and a

slew of under capitalised and underprepared start ups entered and then

21
mostly exited the market. Only Jet Airways and Air Sahara survived beyond

the initial couple of years.

1995 2003 :

After the failure of the deregulation experiment, the industry fell into

dormancy. No new carriers entered the market and Air India and Indian

Airlines continued to be starved of capital. Despite the fact that the broader

economy performed well during this period, aviation continued to show

limited growth. Aviation was largely untouched by the economic reform

agenda of the governments in power as there was little strategic direction

for the sector.

2003 2006 :

This was a period of unprecedented change. With the arrival of Ministers of

Civil Aviation on both sides of parliament that recognised the importance of

aviation for the development of business, trade and tourism, and who had a

vision for delivering a vibrant and modern sector, the industry saw dramatic

reforms across the aviation value chain. Developments included:

Domestic open skies policy which saw market entry by several

carriers;

The arrival of the low cost airline model in India with the launch of Air

Deccan, and subsequently SpiceJet, IndiGo and Go Air;

Announcement of the airport modernisation plan, including the

privatisation of Delhi and Mumbai, upgradation of 35 non metros and

encouragement of Greenfield development;

22
 Placement of orders for 111 new aircraft for Air India and Indian

Airlines;

Liberalisation of the international sector with some private carriers

permitted to operate overseas; greater access for foreign carriers and

opening up of international routes for non metro airports;

Increased foreign direct investment caps in certain sectors of the

industry.

Traffic started to accelerate at double digit rates, both domestic and

!
 international, levels never before seen in India, highlighting a latent demand

for;4)94+'
89)//(: travel.4. )::+5+9)4+ )4 '.3<5+ '(=(4 9)4+;> <.4? '.@+;4(: )&' (&4+9&)4(.&)5> 5+,+5; &+,+9
<+/.9+;++&(&%&'()>?(=?5(=?4(&=)5)4+&4'+@)&'/.949),+5A

India Annual Domestic & International Passenger Numbers 96/97 08/09 :
!"#$%&""'%()*+,-.$/0!".,1"%.$*"%(2%--,"3,14'+5,1-67869:;<8;6




Source : CAPA India Review of 2009 and Outlook 2010
=;;7;9>B39(&=4?(;C+9(.'>49)//(::.&4(&3+'4.)::+5+9)4+/394?+9>4.5+,+5;)CC9.):?(&=D0E(&
!00FAG.-+,+9(4 -);)44?(;;4)=+ 4?)4 4?+9+)5(4(+;?(4?.@+H)54?.3=?49)//(:-); <3.I)&4>
I(+5'; -+9+ <+(&= ;5);?+' 4?9.3=? .,+9:)C):(4I )&' /9)=@+&4)4(.& ./ 4?+ (&'3;49I> )&' :.;4;
2006(&:9+);(&=
-+9+ 07 : <+:)3;+ ./ 4?+ C..9 ;4)4+ ./ )(9C.94 (&/9);493:439+ )&' ) ;?.94)=+ ./ ?3@)&
9+;.39:+;A
During this period,
8?+<355(;? traffic continued
/5++4 .9'+9;C5):+' to accelerate
<I%&'()& :)99(+9;;)- further, to levels
:)C):(4I<+(&=(&49.'3:+')44?+
9)4+./J4.JAK)(9:9)/4)@.&4?>-?+9+);4?+):43)5=9.-4?(&'+@)&'-);:5.;+94.L
)(9:9)/4+M3(,)5+&4;N
#;('+/9.@4?+@(;@)4:?<+4-++&;3CC5I)&''+@)&'>4?+9)4+./=9.-4?-);;(@C5I 23
4..=9+)4/.94?+(&'3;49I4.?)&'5+/9.@)@)&)=+@+&4)&':)C(4)5C+9;C+:4(,+A
%& ) /9)=@+&4+' @)96+4> -(4? @354(C5+ ;4)943C; :?);(&= @)96+4 ;?)9+> 5.;;5+)'+9
approaching 40% in 2007. However it was at this stage that the realities hit

home although traffic was buoyant, yields were being slashed through

overcapacity and fragmentation of the industry, and costs were increasing

because of the poor state of airport infrastructure and a shortage of human

resources.

The bullish fleet orders placed by Indian carriers saw capacity being

introduced at the rate of 6 to 6.5 aircraft a month, whereas the actual

growth in demand was closer to 3 aircraft equivalents;

Aside from the mis-match between supply and demand, the rate of

growth was simply too great for the industry to handle from a

management and capital perspective.

In a fragmented market, with multiple start ups chasing market share,

loss-leader pricing was widespread and Air Deccan in particular was

responsible for setting fares well below cost as it fought to retain its

first mover market share;

The rapid increase in capacity at a time when the airport

modernization program was yet to deliver upgraded infrastructure,

meant that airports and airways were highly congested, increasing

airline operating costs;

With the inadequate surface access and airport (and airways)

infrastructure, airlines were unable to secure a significant competitive

edge over other means of travel, thereby excluding huge parts of the

still untapped leisure market;

In a period of global boom, demand for skilled personnel such as

pilots and engineers also outstripped supply leading to a sharp

24
 escalation in wages, and in some cases grounding of aircraft due a

shortage of staff;

Balance sheets were stretched as a result of the aggressive fleet

induction programs, combined with the mounting operational losses.

2008 - 09 :

The fragility of the sector - which had over extended itself by growing at rates

that it could not manage, in an environment that was not conducive to

efficient operations was exposed during the fuel price spike of mid 2008

when oil reached close to US$150/barrel. In India, this situation was

exacerbated by the taxation structure which increases the costs of fuel by up

to 60% vis a vis international benchmarks. As costs spiralled upwards,

carriers were forced to raise fares, and with a simultaneous slowdown in the

Indian economy, there was resulting decline in traffic of around 10 - 12%

year on year.

2009 10 and beyond :

After the dramatic changes of the last five years, the Indian Aviation industry

is starting to see the emergence of a more favourable environment :

Indias GDP growth slowed from over 9% in 2007/08 to 6.1% in

2008/09. However, given the contraction globally, this was a relatively

a good result. The economy appears to be recovering earlier than

expected, with GDP growth of 7.9% in the last quarter, ahead of

expectations. The World Bank projects annual growth of 8.0% per

annum from 2011 to 2014.

Domestic traffic is also showing a return to growth. After 12

25
 consecutive months of year on year declines in domestic traffic, July

2009 saw a return to positive territory, which has continued since then.

This is partly due to the impact of a lower base resulting from last

years decline, however discussions with the industry indicate a

discernible increase in demand as business and consumer confidence

increases, although yields continue to remain depressed.

The operating environment is improving, with airports and airspace

gradually being upgraded, and ground access being developed, which

will not only enhance the passenger experience, but should allow

airlines to achieve faster turnarounds and higher aircraft utilisation.

The airline landscape in India has been transformed in recent years. In 2003

there were just 4 carriers Air India, Indian Airlines, Jet Airways and Air

Sahara - all operating full service models. And private carriers in those days

were limited to operating domestic routes only. Today, there are effectively 7

airlines operating 11 different brands.

Air India + Air India Express

Jet Airways + Jet Konnect + Jet Lite

Kingfisher Airlines +Kingfisher Red

IndiGo

SpiceJet

Go Air

Paramount

On the domestic front, the 3 large airline groups Air India, Jet Airways (+Jet

Lite) and Kingfisher Airlines command a 67% market share.

26
 
3&5:+'.>+?5(A/<.&5@5:+F6)<=+)(<6(&+=<.4;?H#(<%&'()@I+5#(<-)B?QLI+5O(5
A.>>)&')SKT>)<7+5?:)<+E

Domestic Market Share November 2009
()*+,-./0123+-'412+%)5+*6+27889


Source : CAPA India Review of 2009 and Outlook 2010
%& 5:+ ! B+)<? 5. U)<A: 0181@ (5 (? +?5(>)5+' 5:)5 %&'()& A)<<(+<? -(66 :),+
6.??+?./(&+DA+??./%V*0S1C(66(.&@./-:(A:5:+5:<++6)<=+)(<6(&+=<.4;?Q#
N(&=/(?:+< #(<6(&+?R )AA.4&5 /.< )6>.?5 %V*0F1 C(66(.&E "#$# +?5(>)5+? 5:)5 5:
General Aviation :
/(&)&A()6B+)<-(66(&5:+.<'+<./%V*SWK1C(66(.&E
This
 has been a neglected sector of the aviation industry but one which could
have significant positive economic benefits. The general aviation industry in

India is at a nascent stage, however strong GDP growth and rising wealth
"#$#%&'()*+,(+-./0112)&'3456..70181 
are stimulating demand. Further more, the long distances and poor state of

surface infrastructure in India make this an ideal market for air travel,

particularly to smaller and more remote destinations where scheduled

services do not operate. The expansion of all economy services and gradual

removal of business class could further drive demand for private aviation

from the senior corporate segment. Non-scheduled passenger traffic has

more than doubled in just the last 4 years. Demand is largely from the

corporate sector, however there is increasing take up related to luxury travel.

Strong growth has been witnessed over the last few years, infact India has

27
the fourth highest number of firm business jet orders in the world, and almost

double the size of the current fleet. In the next 5 years, India will have one of

the ten largest business jet fleets globally.

With the Indian economy set for strong and sustained long term growth, we

can expect to see the general aviation sector in India undergoing a dramatic

transformation in a very short period of time, however some key challenges

remain :

Absence of dedicated general aviation terminals, heliports and fixed

based operations;

Restricted timings at key metro airports and lower priority clearance

relative to commercial traffic;

Lack of hangar space and parking bays;

Limited maintenance facilities;

High import duties and a cumbersome import approval process;

Obtaining permission to operate at civil enclaves can be a lengthy

process;

Severe shortage of skilled pilots and engineers.

28
Aviation maintenance sector in India
Industry Overview

According to the industry research papers published in industry journals

(Aviation week, Feb 2010), it takes almost over 5,000 people to put each

flight on air and perhaps another 5,000 to ensure that you fly without any

incidents and land safely. Over 95% of these people dont work for airline

companies. Behind the swanky aircrafts and smiling air hostesses hides a

network of companies and operations that allows smooth flying anywhere.

Apart from the services that you are offered on your flight, it is the ancilliary

service providers, the key amongst those being MROs, who keep you and

your flight afloat, since they have a direct bearing on those services and the

entire business.

On an average, about 4 lakh passengers (domestic and international) fly

every day in India (DGCA 2010). And this number is poised to grow at an

average of 25% every year. Plus, investment to the tune of Rs.6,00,000 crore

(CAPA Sep 2010) is expected to pour into the aviation sector over the next

eight to nine years in the form of the new airports, maintenance facilities

(MRO) and other infrastructure. A similar amount will be spent by airlines to

buy a total of 1,150 aircrafts. In short, the aviation maintenance sector is

bound to grow many folds as the aviation industry in India grows.

For a decade, India has seen a substantial growth in national and

international passenger traffic. The increasing numbers translates into

increased demand for aircrafts and thus the maintenance of aircrafts. The

29
passenger traffic grew by over 200% in the last ten years, resulting in a

similar demand for MROs, since the LCC (Low cost carrier) business model

of the new airlines do not include much of aircraft maintenance in-house.

The Indian governments plan to develop more non-metro airports as

strategic airports serving the region or the respective states also goes to

show that, in future, some airports will make money not purely on passenger

traffic, but also by means of renting their space to MROs, logistics companies

and real estate projects. Hence modernization, privatization and

development of Greenfield or Brownfield airports are going to bring more

opportunities for entrepreneurs interested in Aviation maintenance and Air

Charter business.

This research project attempts to study the evolution of entrepreneurs in the

aviation maintenance sector in India. Study done by researchers in the

aviation sector leads us to believe that there has not been exponential

growth in the aviation maintenance sector in India, although the aviation

industry as such has grown 200% in last 10 years. Since the Aviation

technology is controlled and monopolized by the OEMs (original equipment

manufacturers) from United States and Europe, not much growth is seen in

Asia, especially India.

In spite of several attempts made by government of India during the last 2

decades, there has not been much growth in the maintenance facilities of

aircraft components in India, manufacturing of aviation components still being

30
a distant dream. Independent third party large maintenance facilities are still

to evolve and those who have setup facilities are struggling to sustain.

While more than 200 aircrafts have been added into the fleets of various

airlines as well as business jet owners in India, during the last 3 years, not

much growth has been observed in the maintenance sector. Government of

India through ministry of civil aviation has made attempts to provide favorable

environment for evolution of Aviation maintenance sector in India, however

the results are not very encouraging. Fact remaining that, the dominance and

regulatory controls by the west (FAA & EASA approvals) and challenge to

meet the high quality standards of aviation industry make it difficult for

entrepreneurs to start new ventures in this sector. Those who have evolved

during the earlier decades are finding it difficult to sustain without external

support.

The research is expected to arrive at a deeper understanding about the

evolution of entrepreneurs in the aviation maintenance sector and factors

affecting their sustenance. It is an attempt to gather information on various

factors effecting the growth of independent maintenance facilities in India

both in Civil (commercial) and General (business) aviation sectors and thus

study the barriers faced by the entrepreneurs in entering this field. Apart from

aviation being a capital intensive industry, monopoly of the OEMs and slow

evolution of aviation technology in India are some of the challenges faced by

the entrepreneurs in India, thus a scope for study of these factors.

31
As such, the information contained herein should be of particular importance

to entrepreneurs who intend to venture into aviation maintenance, policy

makers and OEMs who would be interested to explore the opportunities in

the Indian aviation industry. For policymakers, it will demonstrate the on-the-

ground results of the current policies and provide evidence that will inform

future policies. In the case entrepreneurs viewing to venture into aviation

maintenance sector of the aviation industry in India, this information will

facilitate the design of appropriate business models keeping into

consideration the challenges that they will face in this sector.

In 1994, the Indian Government, as part of its open sky policy, ended the

monopoly of IA and AI in the air transport services and private operators

were allowed to provide air transport services. Foreign direct investment

(FDI) of up to 49 percent equity stake and NRI (Non Resident Indian)

investment of up to 100 percent equity stake were permitted through the

automatic FDI route in the domestic air transport services sector. However,

no foreign airline could directly or indirectly hold equity in a domestic airline

company. This could be one of the reasons which kept the foreign investors

away from investing in the MRO development in India.

By 1995, several private airlines had ventured into the aviation business and

accounted for more than 10 percent of the domestic air traffic. These

included Jet Airways Sahara, NEPC Airlines, East West Airlines, ModiLuft

Airlines, Jagsons Airlines, Continental Aviation, and Damania Airways. But

only Jet Airways and Sahara managed to survive the competition.

32
Meanwhile, Indian Airlines, which had dominated the Indian air travel

industry, began to lose market share to Jet Airways and Sahara. Today,

Indian aviation industry is dominated by private airlines and these include low

cost carriers (LCC) such as Jetlite, Kingfisher red, Indigo, GoAir, SpiceJet etc

who have made air travel affordable.

Table 1.1 : Fleet data for year 2000 2010 :

Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Aircr
afts 393 459 485 508 545 559 688 702 788 840 910

No. of Aircrafts in India for 2000 - 2010

1000
900
800
700
600
500
400
300
200 Aircrafts
100
0

Source: ICAO data of 2008, IATA 2009 estimates and 2010 forecasts and
Airport Authority of India traffic forecasts

The 9th largest aviation market in the world is India. Taking the help of the

statistics from ICAO, IATA and AAI it could be seen that the fleet of aircrafts

in India has more than doubled in last 10 years. The above table shows all

the aircrafts including commercial and general aviation aircrafts. More

33
opportunities in the aviation industry in India are likely to make way for about

69 foreign airlines from 49 countries.

Low cost carriers have thrown open the Indian skies and are fast becoming

successful business models. They have not focused on establishing in-house

maintenance facilities, as their business model demands outsourcing of

maintenance jobs to third party MROs. This can be considered as a great

opportunity for the entrepreneurs to venture into aviation MRO, viewing the

demand for maintenance as the fleets of these LCCs gets older. However,

the fact that MROs in India are still struggling to sustain makes it a vulnerable

proposition for entrepreneurs to venture into this sector of aviation industry.

This study should also provide further information to the budding

entrepreneurs who plan to get into the aviation MRO business.

While the Indian aviation industry is experiencing exponential growth, MRO

work is typically outsourced outside of the country. Less than 5% of MRO

work is carried out in India, it all goes abroad. This fledgling industry,

however, has the potential to excel in coming years.

By 2015, India will have 125 airports, up from 92 this year and 1,800 aircraft

by 2025 (ICAO projections of 2009), which creates enormous scope for

setting up MRO facilities. Opportunities exist in areas such as engine

overhaul, airframe repair and over haul, component repair and paint shops,

which are not found in India. The nearly $475 million currently spent on MRO

in India is expected to go up to around $1 billion dollars by 2020 (CAPA

34
industry news 2010). MROs in India are more imperative than an option. The

challenge is to build in cost efficiencies. The competitive advantage of low

labor cost is lost with constraints of high taxes, regulatory issues, lack of

space at metro airports, lack of training institutions and a high attrition rate of

skilled labor.

An airline loses money, while an MRO makes it. There is need for economies

of scale and a quality one-stop shop. Airlines can make all the difference if

they are willing to sign longer maintenance agreements. While the

government looks at aviation seriously, it does not consider MRO a priority,

more over it has to be an industry initiative. Given that Mumbai-Delhi is one

of the busiest city pairs with 48 daily flights carrying 106,000 passengers, the

aviation business is growing, however neighboring countriesSri Lanka,

Bangladesh and Nepalmay get an edge over India as land is cheaper

there. With upgrades to airports such as Lucknow and Jaipur in central and

North India, opportunities to set up MROs are increasing.

While leasing is a popular mode for aircraft acquisition world-wide, in India

many new airlines have opted for acquisition through purchase Acquisition

through purchase puts the onus of maintenance on the airlines themselves,

the airlines would therefore need to enter into comprehensive maintenance

contracts. The following chart shows the maintenance relationships

established by various airlines.

Presently, a lot of such work is being sourced from service providers based

35
in regions such as Singapore and Europe.

Line Maintenance Base Maintenance Component Repair

Air India Air India Air India Air India

Indian Indian Indian Indian

Jet Airways Jet JAECO Lufthansa

King Fisher Kingfisher Lufthansa MAS / Lufthansa

Spice Jet Spice MAS Boeing

Indigo Air Indigo Sri-Lankan Airfrance

Go Air Go Air MAS Airbus

Paramount Paramount - GE

Source : CAPA news letter Mar 2009.

A number of companies have firmed-up plans to enter the airline market in

India. This signifies an enormous growth potential for the MRO market. The

proposed airlines which plan to operate a variety of formats such as

chartered carriers, regional discounters etc will add to the market potential for

MRO.

The Independent aviation MRO market in India is largely untapped, as there

are hardly any third-party service providers with the ability to address the

needs of the existing fleet. The prohibitive costs of getting the aircraft

serviced outside the country, due to the absence of domestic service

providers, are eating into airlines' profits. In fact, airlines are charged by the

hour for aircraft maintenance, creating an urgent need for aviation MRO

36
services in India. The development of the Independent aviation MRO market

in India will not only provide cost benefits to airlines but also greater

employment in the country. Proactive infrastructure set ups, along with the

availability of manpower, will add value to the market in the long term. "Labor

costs in India are around $30 to $35 per man-hour, compared to $55 to $60

in Southeast Asia and Middle East and even higher in the United States and

Europe," (aviation week publication journal Sep 2010). "Therefore, India has

the potential to service not just Indian aircraft but also those from neighboring

regions."

Growth rates for the various services in the maintenance cycle are positive

and MRO service requirements in the country are expected to grow at a

compound annual growth rate (CAGR) of 13.5 percent between 2009 and

2015. Moreover, the current fleet of over 900 in India can bring in substantial

business for any MRO provider with the required capabilities and certificates.

Airlines tend to opt for MRO service providers with cost-effective and high-

quality services, optimal turn around time, and those that adhere to best

practices so that the aircraft lasts long, with the best operating efficiency and

safety standards. "The brand name and credibility of the MRO service

provider is expected to be the most critical success factor in India,".

Indian policies are mostly favorable to MRO operations and although service

providers face some restraints in terms of taxes and duties, they are

expected to become more transparent in the coming years. All segments of

the MRO chain can be addressed in the country, but in different time frames,

37
based on the need and ease of setting up the service. MRO service

providers will be encouraged by the establishment of special economic zones

(SEZs) and land allotment for setting up MRO operations. MRO services are

strictly defined by market needs; hence, it will be vital to understand existing

fleet details and arrive at the market addressability to design the business

model of the MRO. Airlines will also be keen to know the MRO's

operating/service structure; therefore, the strategy for MROs will be to

identify the key segments of the MRO value chain and address the needs of

the current fleet and expected fleet additions.

Industry reports say that India is emerging as an important and lucrative

MRO hub. The current Indian MRO industry is pegged at US$600 million,

which is expected to touch $1.06 billion in a couple of years (ministry of

Aviation, 2009). Recent studies have also showed that the countrys MRO

industry will be growing at 15% annually which should invite entrepreneurs

towards this lucrative industry. Although at a nascent stage, the Indian MRO

industry has tremendous growth opportunities.

The current challenge in the aviation maintenance industry has been focused

on the need to maximize operational efficiency. Faced with the challenge of

reducing maintenance costs, executives in Maintenance, Repair and

Overhaul Industries continually look for alternative ways to streamline their

maintenance operations.

The uncertainty of meeting the dynamic and complex needs of the changing

38
aviation industry, devoid of newer technology are widespread. The transition

to new technologies for managing maintenance programs will be challenging.

Research suggests that maintenance providers possessing strategic

technologies can define their position in the aviation industry and stand to

reap the greatest benefits. The shift towards utilizing innovation escalates

challenges, competition, cost and risk. The current demands of Maintenance,

Repair and Overhaul industry has a direct impact on the MRO Technicians,

which include maximum job efficiency; reduced down time, while maintaining

safety and reliability, impacted by emerging technology.

Today, the aviation industry is facing tremendous challenges. To compete,

aviation companies in all segments must strengthen their ability to increase

productivity and production rates with products and services that meet

customer demands, with a focus on continuous critical assessment of cost

and performance. So, the continued support for MRO is an intrinsic part of

Indian aviation industry, with service lifecycle management, reducing costs

and improving service quality.

The purpose of this study has been to determine what new or emerging

techniques entrepreneurs will have to apply to meet the challenges ahead

and keep afloat. Since there is a huge potential in Independent MRO

business and the over all growth in last 10 years has been slow there are

factors affecting the growth. This research tries to study the factors effecting

growth of entrepreneurs in Independent aviation MRO sector.

39
Air Charter business in India
Industry Overview

Air charter is the business of renting an entire aircraft as opposed to

individual aircraft seats. Airlines specialize in selling transportation by the

seat. On the other hand, air charter companies focus on individual private

aircraft and itineraries, urgent or time-sensitive freight, cargo, air ambulance

and any other form of ad hoc air transportation.

Air charter is also known as air taxi, executive charter, jet charter and is part

of general aviation. The Airline transportation system has become common

now and as a result the airports are crowded and traveling public has to

suffer in longer queues at check-in, airport security, lost luggage, less

amenities, cramped seating and air traffic delays at the major airport hubs

like Delhi and Mumbai. Today when you fly commercial airlines, in some

respects you are at the mercy of the airlines in terms of travel time, comfort,

and whether your luggage arrives with you.

Air Charter addresses the following needs of those who can afford.

Efficiency: Your time is valuable so why waste it in airport check-in

and security lines or suffering through airline delays

Comfort: Arrive for your meeting relaxed, rested and well prepared

Productivity: Privacy and space to work, conduct meetings, or spend

quality time with family

Flexibility: Air Travel on Your Schedule not the Airline Schedule

Security: Control over who and how you travel

40
Obviously the cost of Air Charter can be a concern, however, there are many

cost effective charter options available to suit your needs. You can select

from a multitude of aircraft that vary in cost depending upon type and size.

Air Charters these days provide a wide variety of aircraft and deliver a high

quality experience leveraging the latest technologies to generate cost

effective solutions.

Chartering an aircraft means that you are basically renting the aircraft for a

specific trip and the cost of renting or chartering an aircraft will depend on the

itinerary of the desired trip. Although you may find some standardized air

charter pricing on per flight hour price, it does not always accurately reflect

the total cost for an Air Charter trip because there are several factors that will

determine the final cost.

Charter aircraft trips are customized to your needs, thus the charter price is

affected by many factors, including the aircraft availability, length of stay at

your destination, number of passengers, type of aircraft, and aircraft

repositioning; from its base to your choice of airport. This means that you

must provide a detailed trip itinerary in order to generate an accurate air

charter price or quotation. For most part an Air Charter quote or price will be

a one lump sum total that includes:

Pilots

Flight Attendant(s), if required

Airport Landing fees (cost varies by airport)

Fuel surcharge

41
 Aircraft: usually by flight hour, but there could be an aircraft daily

minimum

Crew overnight costs or two roundtrips

For any country, the aviation sector is not only its gateway to the world but

also one of the most important sectors for its economy and its growth;

generating billions in revenues and creating hundreds of thousands of jobs.

In recent years, the global aviation industry has been through many ups and

downs. From skyrocketing fuel prices to pandemics to recent financial crisis,

aviation industry has confronted a very rough weather in last ten years or so.

Consolidation in mature markets, higher ticket prices, modernization of

airports, policies to reduce emissions and tremendous growth prospects in

emerging economies have been some of the trends during the decade.

According to recent industry reports, the global aviation industry is on the

path of recovery and future looks optimistic and would present ample

opportunities for the stakeholders.

Charter flights are used by wealthy individuals, large corporations, sports

teams and government agencies. In general, charter flight is more flexible,

extensive, and efficient than traditional commercial air travel. Air charter

planes have access to general aviation and military airports where scheduled

commercial aircraft are restricted to and cannot land.

Charter aircraft includes small piston-prop planes; helicopters; turboprop

aircraft; light, mid-weight, and heavy jets; and large, multi-engine jet airliners.

42
Of the charter aircrafts in operation, around 65 percent are fixed-wing aircraft

and 35 percent are helicopters. The smallest piston-prop charter plane

accommodates one pilot and one to three passengers, has a non-

pressurized aircraft cabin, and a range of several hundred miles. A typical

turboprop is cabin pressurized, accommodates one or two pilots and four to

eight passengers, has a range of around 1,000 miles, and travels 200 miles

per hour. Traveling up to 8,000 miles at 500 miles per hour, pressurized

heavy jets are flown by two pilots, can accommodate upto 18, and include a

full bathroom and flight attendant service. Depending on fuselage

configuration, large charter jet airliners can transport cargo or accommodate

up to 300 people.

A charter aircraft typically departs from a small general aviation terminal

known as a fixed base operation (FBO). On smaller charter aircraft, pilots

may be responsible for non-flying tasks such as checking baggage, seating

passengers, and performing minor aircraft maintenance or repairs. Upon

arrival, charter flights and crew may wait for the passengers until the return

flight to the home base. However, around 40 percent of charter travel is

comprised of "empty leg" flights: return trips to a plane's home base with no

passengers or cargo. Each chartered plane flies an average of 250 hours

annually. Charter flights last an average of two hour, and the average aircraft

consumes 80 liter of fuel per hour. Common metrics in the industry include

revenue passenger miles (the total distance traveled by all paying

customers); available seat miles (total number of seats available multiplied

by miles flown); and load factor (the ratio of revenue passenger miles to

43
available seat miles). The average industry load factor is 45 percent; the

commercial airline industry has an average load factor of 60 percent.

The emergence of Rich class in India has increased the demand for Charter

aircrafts for business and leisure travels, however the capital intensive nature

of the business and long breakeven period has held back entrepreneurs from

venturing into this business. Aircraft chartering remains as one of the sideline

businesses of the successful business houses and many a times it is started

with a view to cater to the internal travel needs of the Chairman, MD and

CEOs of the group companies and their aircrafts are chartered when not

flying for internal purpose.

Demand is driven by corporate profits and the needs of the business. The

profitability of individual companies depends on effective marketing and

customer service. Large companies have advantages in fleet size and name

recognition. Smaller companies can compete effectively by serving small

local markets and offering lower prices. The industry is capital-intensive.

Air charter once considered as super luxury, has now become the need of

the corporate world and the successful businessmen have started realizing

the need to fly in chartered aircrafts to save time and for privacy. Aircraft

charter has become an increasingly popular form of air travel, filling the need

for enhanced levels of security, convenience, confidentiality and comfort.

Time is Money, both can be squandered on missed opportunities or used

wisely to grow your company. And Business aircraft charters allow you to

44
take control of the time you spend on the travel. Now - Executives and their

Team can reach any place in the world in the shortest possible time. YES -

Save Time - which was lost at the Airports, Hotel Stay, Delayed Flights and

Unavailable connections.

Charter aircraft gives you the liberty, the freedom to land anywhere, anytime.

Charter flights allow you to plan your own schedule to land at small airstrips

inaccessible to routine commercial flights. So you can land in a small town

close to your factory or a tiny island beach resort away the crowd.

Flying by charter differs from scheduled aviation in many ways, but from the

point of view of the customer it can be summarized in three words: efficiency,

privacy and flexibility. Whatever your priorities, charter air travel gives you

the freedom to organize the trip around your needs.

Flying by scheduled airlines, you travel on the airline's schedule (assuming

they're on time) and zigzag along their hub-and-spoke routes, connecting

here, changing planes there, and sometimes doubling or tripling your travel

time. Long drives to and from large commercial international airports, time

spent reserving, picking up and clearing airline tickets and checking, tagging

or even losing luggage drains your productivity even further. A useful and

private business meeting on board a commercial airliner is impossible, and

completing work confidentially or otherwise is more than a challenge.

With chartered aircraft, you fly where you want, when you want, in the plane

45
you want, and with extra amenities you choose yourself. Increasingly more

and more business and pleasure travelers are discovering the advantages of

charter travel. Time is money and every wasted moment is a lost opportunity.

Aircraft charter puts you in control of your schedule by placing a fleet of

aircraft at your disposal anywhere you are in the world.

Since the air charter business caters to a niche of upper class rich people,

the entrepreneurs into this business face challenges to keep their patrons

satisfied with the quality of service. For the entrepreneurs in Air charter

business, these challenges are heightened by several unique characteristics.

Some of the main challenges requires them to:

Manage varying schedules

Fly into any of several thousand non-hub airports, some at far away or

remote destinations

Communicate with a wide variety of business partners, such as fixed

base operators (FBOs), original equipment manufacturers (OEMs),

and other service providers

Uphold high standards for quality of service

Have a low tolerance for disruptions such as delays and cancellations

Reduce the overall cost of ownership and aircraft management,

including maintenance

At the same time, Air charter is full of innovative entrepreneurs who

recognize the potential of modern information technology to help meet these

demands and streamline their operations.

46
Today, India has a business jet fleet of nearly 130 aircraft out of which only

50 60 are being used for Air Charter, versus 11,000 in the U.S out of which

6,000 are used for Air Charter, that provides considerable room for growth

(Akovenko, 2009). The Business Aviation Association for India predicts 400 -

600 business jets by 2015. Companies and individuals will need to fly farther

as business expands among continents, providing an incentive to the Air

charter business.

It's ironic that in a country where the fiery expansion of the aviation sector is

led by a dramatic growth in the economy, Air charter is hit the most as a

result of infrastructure restraints. Industry estimates that general aviation in

India is likely to grow by 30% to 40%. With more than 700,000 Indians

accounting for a cumulative wealth of $3 billion, this comes as no surprise.

Information through BAAI (business aviation association of India) reveals that

"One business jet will be added every week for the next two years.

"Deregulation, availability of finances, eased regulations for foreign

investment in Indian companies, and paradoxically, the painful experience of

travel on a commercial jet are driving this growth.

As major businesses and high-net-worth individuals lineup to travel by

Chartered Aircrafts, medium and some small company owners are also

jumping on the bandwagon.

Lack of space at airports is becoming a major hurdle for Air charter business

to expand. Operators face constraints at every step (Karan Singh, 2010) due

47
to non-availability of general aviation terminals, poor facilities for ground

handling, lack of hangar space and parking, and no heliports add to the woes

of operators.

Lack of MRO facilities for general aviation aircrafts with only line

maintenance available drives up the cost of maintenance, increasing

downtime for aircraft, which results in revenue losses. For all heavy

maintenance, aircraft components have to go to Singapore, Dubai, Europe,

or the U.S, depending on the type of aircraft and component.

With at least 300 to 400 general aviation aircraft to be added in the next four

years - provided infrastructure and airport space allow it, and there are

adequate pilots and engineers to operate them - the market Air Charter

business is enormous.

With such high level of growth expected in next 5 years, not much

information available about the entrepreneurs in this sector, a study was past

due to understand the entrepreneurial factors which were inhibiting the

growth. To carry out such a research, it was necessary that the evolution is

studied in detail, basis on which pattern and findings can be drawn about the

scenario in this sector.

48
 CHAPTER II

LITERATURE REVIEW

49
 CHAPTER II

REVIEW OF LITERATURE

Literature Review :

The purpose of this research is to study the evolution of entrepreneurs in

Independent Aviation MRO and Air Charter sectors in India and then find our

the factors effecting their sustenance. More specifically this research

determined the factors like a) family back ground b) entrepreneurs back

ground c) source of funding d) break even e) instinct to take risk f) desire to

take challenges g) money and h) glamour, which contributed to the

motivation of an entrepreneur and affected his sustaining capacity. Thus the

review of literature was done with a focus to cover most of the above

mentioned factors.

In this chapter, few scholarly books, articles, journals and research papers

have been reviewed which are relevant to the current study on Evolution of

Entrepreneurs in the Indian aviation industry and factors effecting their

sustenance, with special reference to Independent aviation

maintenance companies and Charter Aircraft operators.

During the course of research, it was observed that very few books are

available on the aviation industry of India and hence the literature review has

been carried out on the basis of the limited literature available, and foreign

journals and publication have been referred.

50
Articles were gathered from Trade magazines and aviation reports, which

helped in collecting secondary data for the study.

Internet was extensively used to gather various literatures and articles

related to MRO and Air Charter industries in India. Data mining was done

using the software Proquest through the RBI library.

The research scholar Howard G. Jones has done a detailed study on the

history of WACO Aircraft company, which started in the year 1919 and

closed in 1963. His dissertation shows how the Waco aircraft company

reflects the transformation of economic conditions in the twentieth century.

Beginning just after the first world war, its entrepreneur, Clayton J.Brukner,

developed a network of relationships within the aviation industry. This

allowed his company to develop significant competitive advantage in the

private flying market. Those advantages and the popular appeal of aviation

helped Waco to become largest manufacturer of civilian aircrafts.

This research by Howard has emphasized on the networking and

relationships of entrepreneurs in the aviation industry. Waco aircraft

manufacturers entrepreneur Brukner was involved with the trade

associations and that revealed the critical role government played in the

development of his company.

Howard wrote in his findings that relationships play an important role for any

entrepreneur to be successful in his venture. Through the research on Waco

51
aircraft manufacturing company, Howard has concluded that Waco Aircraft

company is a case that highlights the importance of public and private

collaborations in encouraging innovative behavior amongst entrepreneurs. In

small firms the innovative drive often lies with one leader. His research has

studied this leader, the entrepreneur, as the key factor for economic growth

of any country.

This researchs findings show that the activities of an entrepreneur causes

market disequilibria that creates the opportunities for consumers and firms

to reallocate their resources more efficiently. A series of innovations

stimulates economic growth, adding a dynamic component to the static

equilibrium free market competition theoretically imposed on economies. The

research on Waco Aircraft company is particularly useful because it includes

both entrepreneurial success and a remarkable failure to continue innovative

efforts as market conditions changed.

This study reveals that although Brukner the promoter of Waco Aircraft

company was not flamboyant, his leadership helped him shape the early

expansion of an industry in which his country played a predominant role. He

personally forged the manufacturing, marketing and management

components into a coherent system that gathered market information and

translated it into products that won sales regularly exceeding the combined

efforts of his two closest competitors. A key to his success was his active

participation in every aspect of his company. He met people and fellow

aviation entrepreneurs at gatherings and learned about the competition first-

52
hand. This helped him design his strategy and shape his company.

Simon Buck and Zen Lei Strategic (2008), have conducted a research on the

topic Charter Airlines - Have they the future. Their report highlights factors in

both the internal and external business environment which are plaguing

Ryanair in terms of maintaining a strategic orientation that is completely

congruent with sales goals and growth initiatives. A micro- and macro-level

analysis of the firm in 2008 gives over all idea of the growth trends in Air

Charter business in the Europe which could be compared to the Air charter

business growth in India.

PEST analysis is an acronym for political, economic, social and technological

(Channon, 1997). Each of the aforementioned forces are categorised by a

particular macro-level external influence, each of which directly impacts

strategic direction of Air Charter business. The external political environment

is one of significant factors effecting the Air charter business. It is relatively

common knowledge that political stability effects the air charter business,

thus the operators do not experience issues with governmental instability as

a concern regarding passenger volumes or flight destinations.

Mathew J. Manimala (1999) contributes to this discussion through his

dissertation - Entrepreneurial Policies and Strategies. Considering the fact

that the Government cannot be the sole employer, the role of entrepreneur in

alleviation of poverty is enormous, especially when entrepreneurs invest in

the area of ICT, which is a huge employer of labour directly and indirectly.

53
Successful entrepreneurs are those who have the great ability to articulate

in a passionate way what their vision is, to not just their investors, but also to

their employees and potential customers. They should understand their

limitations, wiling to be held accountable, need to be focused, tenacious and

determined to succeed. As they grow their businesses, they must learn to

enlarge their inner circles and empower their professionals for their business

to grow.

Mathew Manimal has done an extensive research on the traits of

entrepreneurs and development of Entrepreneurial policies and strategies for

Singapore government. During his research he has interview several small

and medium entrepreneurs and drawn conclusions about the common traits

found in them for achieving the success in business. The common goal

which he found with all the entrepreneurs interviewed was persuasive and

passion.

It is sited that the entrepreneurial skills are difference in different countries

depending on the socio economic conditions of there, however the

persuasion and passion are two traits which are common all over the world in

the entrepreneurs.

Shawn Wang and Peng Chau (1990), discuss the specific details about

success of Baidu the internet based entrepreneurship. China emerged as a

global powerhouse, poised to become one of the world's biggest economies

in the near future. Baidu, now one of that Asian country's major technology

54
companies, has played a critical role in this growth and is now looking to

expand beyond the Chinese market. In many ways the company exemplifies

the pioneering energy coming out of China, a movement Wang described as

"first generation entrepreneurship." "In China, if you want to be successful,

you really have to have the courage, you have to have the mentality to do

something that's never been done before," he said. "This is really first

generation entrepreneurship in China. This is becoming big. It only happened

in the last few years."

China's new entrepreneurs face major challenges, as they are forced to

come up with their own roadmaps to success, he said. Entrepreneurs and

executives from the United States and other countries can get guidance from

"corporate policies, corporate procedures, and corporate manuals that you

can just follow," he said. "We're starting from scratch,". The potential for

growth clearly is huge for companies such as Baidu as China's economy

steadily expands, Wang said. Baidu is a major Chinese language internet

search company and web platform for businesses. "Our biggest challenge is

managing our growth," he said. "We can only be our own competitor. Our

ability to execute, our ability to grow our people, manage our business, and

manage the scale of the operationsthese are the challenges we face. And

this is the challenge all Chinese companies face." Wang joined Baidu as

chief financial officer in 2004. Before then, he was a partner at

PricewaterhouseCoopers, working with PwC's Global Capital Market Group

in such cities as New York, London, Hong Kong, and Beijing.

55
During the literature survey several national and international journals were

studied and an understanding made about the entrepreneurship skill related

to aviation industry.

Ko Chi Chung (2009), has greatly contributed to the study of

entrepreneurship through his research work and dissertation with topic

Entrepreneurial opportunity identification Through Bisociative mode of

thinking in Aviation maintenance. Opportunity identification has increasingly

being viewed as a core attribute of entrepreneurship (Shane &

Venkataraman, 2000), without which entrepreneurship cannot take place

(Singh, 1998).

This dissertation addresses the fundamental question of entrepreneurship

from a cognitive perspective: why some people are able to identify

entrepreneurial opportunities. It suggests that social networks, information

diversity, prior knowledge, and entrepreneurial alertness are necessary but

not sufficient to explain the process of identifying entrepreneurial

opportunities. Whether an opportunity can be identified necessitates

cognitive processing in the form of bisociation , which refers to the bisociative

mode of thinking through connecting previously unconnected matrices or

domains of information (Koestler, 1964). By incorporating the role of

bisociation in process of opportunity identification, the framework of this

study differs from previous ones in that (1) it highlights the importance of an

individuals bisociative mode of thinking to opportunity identification as a

mediator; (2) it looks into the moderating effects of high technology

56
entrepreneurs; (3) it considers a framework broader than firm creation with

respect to opportunity identification, by taking into account innovative

product, services, or technology opportunities in the existing business; (4) it

focuses on the identification of novel opportunities only; and (5) it examines

the influence of individuals and opportunities, rather than environmental

antecedents and consequences because entrepreneurial opportunity

identification is primarily an individual-level phenomenon (Hills, Shrader, &

Lumpkin, 1999).

While there was no relationship between social networks and entrepreneurial

opportunity identification, it was found that the bisociative mode of thinking

did act as a mediator for information diversity, prior knowledge and

entrepreneurial alertness with respect to the number of entrepreneurial

opportunities identified. Moreover, the relationship between prior knowledge

and number of entrepreneurial opportunities identified was stronger for high

technology entrepreneurs. One of the most important units of observation for

analyzing the determinants of entrepreneurship has been at the level of the

individual. Empirical tests of the model of income choice have focused on

personal characteristics. For example, using U.S data, Evans and Leighton

(1989a, 1989b and 1990) link personal characteristics, such as education,

experience and age as well as employment status, of almost 4000 white

males to the decision to start a new firm. Other studies, such as Bates (1990)

also using U.S data, and Blanch flower and Meyer (1994), emphasize human

capital in the income choice. Storey (1991, p.177) concluded that, "the

consensus is that time series analysis point to unemployment being, ceteris

57
paribus, positively associated with indices of new firm formation, whereas

cross-sectional, or pooled cross-sectional studies appear to indicate the

reverse. Attempts to reconcile these differences have not been wholly

successful. They may reflect possible specification errors in the estimating

equations, since none include all the independent variables which have been

shown to be significant in the existing literature. In particular, we suggest that

more attention is given to the issue of taxation, savings and state benefits

than has been the case in the past."

In the European context, Foti and Vivareli (1994) analyze self employment

data in Italy and find out that unemployment has a positive impact entry into

self-employment. Ritsila and Tervo (2002) found the existence of a positive

and non-linear effect of personal unemployment on the likelihood of an

individual to become an entrepreneur. However, DE Wit and Van Winden's

(1989) findings suggest that the probability of self employment is positively

influenced on the earnings differential between self-employed and wages

from employment, having a relatively high score on an IQ test applied at the

age of 12, and the employment status of the father (being self-employed).

Colombo and Delmastro (2001) examine the characteristics of high-tech

entrepreneurs in Itlay. In particular, they identify differences in the

characteristics found between the internet sector and other ICT industries.

Their findings suggest that entrepreneurs who started firms in internet based

businesses are systematically younger than their counterparts in other ICT

industries.

58
Thus, over the decades, many studies have been conducted on the

relationship between the entrepreneur's human capital and the post-entry

performance of new or entrepreneurial firms. These studies generally

demonstrate that the entrepreneur's age, education, work experience, and

other factors, have a positive effect on the post-entry performance. Among all

these, age of the entrepreneur is very important because on the one hand,

age increases individual ability to exploit opportunities. On the other hand,

however, opportunity costs and therefore reluctance to bear risk increases

with age. The empirical evidence on the effect of age on new firm formation

is controversial (see Reynolds, et. al.; 1994 for a survey). Age has also been

shown to correlate positively with entrepreneurial firm performance (Birley,

1987). Among them, Cressy (1996) emphasizes the role of the

entrepreneur's human capital, especially his or her age, and suggests a

model that assumes the probability of a new firm's survival is an increasing

function of an entrepreneur's age. In a study of 71 small business owners, it

was found that risk-taking propensities depended on the following factors:

age, education, years of business experience, span of life and size of the

business (Schwer and Yucelt, 1984). On the other hand, the life cycle

approach to business development (Kimberly and Miles, 1980; Scott and

Bruce, 1987) suggests that the risk-taking propensity of the entrepreneur

decreases over time; when the entrepreneur makes a transition to business

manager, then by definition, he or she becomes less of a risk -taker and

instead assumes a caretaker role. Several researchers in the typology field

(Cooper, 1997; Chell and Haworth, 1992; Miner et al., 1992; Westhead,

1990; Birch, 1987; Smith, 1967) have found in these studies is that risk-

59
taking propensity varies according to personality type.

Sinha's (1996) treatise covered human factors in entrepreneurship

effectiveness. The study revealed that successful entrepreneurs were

relatively younger in age, technically educated and had some business

background in the family. Thus, the link between the development of a

preference for an entrepreneurial career and factors such as parental role

models (Scherer et al., 1989), education and employment history (Cooper,

1973), age of the entrepreneur and family life cycle stage (Petrof, 1981),

socio-cultural (Terpstra et al., 1993) and economic factors (Gould and

Keeble, 1984) have all been explored in the literature (see Garavan et al.

1997 for a review). However, only a few fragmented studies have

concentrated mainly on entrepreneur's age which in this paper is

hypothesized to have an impact on firm entry, ownership and risk.

Rishikesha T. Krishnan (2008) have contributed to the literature survey

through their research paper with topic The Indian Aviation Industry 2008,

submitted to Indian Institute of Management, Bangalore. The focus of this

paper is on the domestic airline industry in India, their operations and growth

in next 5 years. This research paper gives details about the factors affecting

the operational costs of the airlines in India and how they are balancing these

costs to survive. This study also gives information on per hour maintenance

cost involved in flying of aircrafts and its impact on the overall cost of the

airline. This research paper compares the airline industry with the aircraft

manufacturers and the over all growth of this industry.

60
Research Gap :

Not much research work has been done in the past in the area of

entrepreneurship in Independent MRO and Air Charter business in India.

What are the difficulties faced by entrepreneurs in these two sectors and how

they over came it, has not been studied in detail. Based on the review of

literature, it is evident that very little academic material is available on the

evolution and sustenance of entrepreneurs in these two sectors of aivaiton

industry. However the importance of entrepreneurs for any economy can not

be marginalized. Entrepreneurs are the ones who drive the economy,

generate employment and contribute to the development of society. More

than any thing entrepreneurs stand on their own feet and support the country

by paying high tax and contributing to the over all growth.

As each individual entrepreneur carries different set of skills and behaves

differently in different situation, it is difficult to predict any trend. Studies in the

past have tried to evaluate the entrepreneurial traits and skills for the

success or failure of business, however very little research has been done

with focused on evolutionary factors with its effect on sustenance and further

growth of entrepreneurs. More over no research has been done in the area

of entrepreneurial sustenance in Independent MRO and Air Charter business

in India. This leaves a wide scope for a research on this subject to be

conducted and findings kept for reference by entrepreneurs as well as

creating a platform for further research on the related subjects.

Recently several researches have found scope in subjects related to

61
entrepreneurship, however during the literature survey as well as interaction

with research scholars not much information could be gathered on

entrepreneurship in MRO and Aircharter sectors. This reflects the gap for

research in this area. Past research have not adequately addressed the

evolutionary factors of entrepreneurs, thus no literature is available on the

entry barriers in MRO and Air charter sectors.

Further, this is the first such study correlating evolutionary factors with

sustenance of entrepreneurs. Findings of this research should contribute to

the emerging entrepreneurs who would like to venture into Independent MRO

and Air charter business not only in India but other parts of Asia too. Findings

of this research could also contribute to the government in framing the

aviation policies.

In view of the above and research gap, a need was felt to conduct a research

which covers all the aspects of entrepreneurship related to Independent

Aviation maintenance and Air charter segments.

62
 CHAPTER III

OBJCTIVES OF RESEARCH

63
 CHAPTER III

OBJECTIVES OF RESEARCH

Research Problem :

Studies suggest that aviation is a controlled and regulated industry due to

high level of precision required in work. Thus it requires courage and different

set of business skills for entrepreneurs to enter in aviation business. There

has been phenomenal growth in the number of aircrafts as well as the

passenger traffic in last 5 years, however the MRO business has not seen

growth in similar ratio. It is well understood that as the number of aircrafts

increase and they fly more, there will be need for more maintenance.

However the fact that Independent Aviation MROs in India have almost seen

negligible grown in proportion to the growth in Air traffic, gives rise to the

questions like; What are the factors effecting the growth of Independent

Aviation MROs in India ? Why entrepreneurs are not finding it attractive

enough to venture into MRO business ? Why the airlines have not developed

their own MRO subsidiaries like the airlines in western countries ? What are

the challenges faced by entrepreneurs in entering into Independent Aviation

MRO business ?

The economy of India is one of the fastest growing in the world and except

for the depression in 2007 and 2008, there has been exponential growth for

the past 10 years. Despite the fact that a rich class of businessmen have

emerged in India, the Air Charter business has not picked up in similar

64
proportion. Air charter is a very common mode of transport in the western

countries and many of the entrepreneurs tried to replicate similar business

model in India, however to their dissatisfaction the entrepreneurs in India

dont seem to be spending much on their luxury and privacy of travel. This

gives rise to research problem based on, Why Air charter business has not

pickup as in the west ? What are the challenges being faced by

entrepreneurs in Air charter business ? What are the operational difficulties

which is holding back the growth of Air charter business in India ?

The research seeks to study and analyze these aspects of Indian

entrepreneurs who have established their organization despite the fact that

not a single component of Aircraft was manufactured in India till 1990s and

what are the challenges in sustenance and further growth of such

organizations.

Also the studies done so far have focused mostly on commercial angles of

the aviation industry and not touched the entrepreneurial factors effecting the

growth of aviation maintenance and Air charter businesses in India. This

study seeks to analyse the factors effecting entrepreneurship in these two

sectors of aviation Independent MRO and Air charter.

Thus the research problems could be summarized as ;

What are the motivational factors for entrepreneurs to engage

themselves in these two business activities ?

65
 What are the entry barriers in these two sectors ?

What are the challenges faced by entrepreneurs in these sectors ?

What are the Factors effecting their sustenance ?

What are the rewards for accepting such challenges ?

Statement of Research Objectives :

To analyze the general and financial facts related to entrepreneurs,

which effect their motivation and sustenance in Independent aviation

MRO and Air Charter business.

To understand the motivational factors of entrepreneurs to venture

into Independent aviation maintenance and Air Charter business

sectors.

To identify the entry barriers of these two business sectors which

entrepreneurs face while entering.

To analyze the evolutionary factors which have direct bearing on the

sustenance and growth of entrepreneurs in these two sectors.

To identify the challenges faced by the entrepreneurs in sustenance

and further growth in both these sectors and to determine the

66
 entrepreneurial skills required to overcome these challenges.

To assess the impact of internal and external factors effecting the

development of these two sectors.

To determine the effect of rewards on the motivation, evolution and

sustenance of entrepreneurs in both Independent Aviation MRO and

Air Charter businesses.

Hypothesis :

To pursue the proposed study, the following hypotheses are framed and their

validity tested through research techniques:

H01 : Family background did not play any role in motivating an

entrepreneur to venture into Independent MRO and Air charter

business.

H11 : Family background did play a role in motivating an entrepreneur

to venture into Independent MRO and Air charter business.

H02 : High profit margin is not a major motivating factor for

entrepreneurs to enter in Independent MRO and Air charter

business.

H12 : High profit margin is a major motivating factor for entrepreneurs

67
 to enter into Independent MRO and Air charter business.

H03 : Motivation has no impact on the evolution of entrepreneurs in

these two sectors of aviation industry.

H13 : Motivation has a significant impact in the evolution of

entrepreneurs in these two sectors of aviation industry.

H04 : Source of funding has no impact on the capability of

entrepreneurs to over come entry barriers in these two sectors.

H14 : Self and family funded entrepreneurs are able to overcome the

entry barriers easily.

H05 : High initial investment and long break even period is not an

entry barrier for entrepreneurs to enter into Independent MRO

and air charter business.

H15 : High initial investment and long break even period is an entry

barrier for entrepreneurs to enter into Independent MRO and air

charter business.

H06 : Evolution of entrepreneurs in the Indian aviation maintenance

and Air charter sectors was not innovative idea based.

68
H16 : Evolution of entrepreneurs in the Indian aviation maintenance

and Air charter sectors was innovative idea based.

H07 : Evolution of entrepreneurs in the Indian aviation industry

(independent MRO and air charter) was not industry need

based.

H17 : Evolution of entrepreneurs in the Indian aviation industry

(independent MRO and air charter) was industry need based.

H08 : Stringent Regulatory norms are not a challenge for sustenance

of entrepreneurs in these two sectors of aviation.

H18 : Stringent Regulatory norms are a challenge for sustenance of

entrepreneurs in these two sectors of aviation.

H09 : High Initial Capital and high operating cost is not a challenge for

sustenance of entrepreneurs in Independent MRO and Air

charter business.

H19 : High initial cost and high operating cost is a challenge for

sustenance of entrepreneurs in Independent MRO and Air

charter business.

H010 : Glamour attached to the aviation industry does not attract

69
 entrepreneurs to venture into air charter business despite poor

rewards.

H110 : Glamour attached to the aviation industry attracts entrepreneurs

to venture into air charter business despite poor rewards.

H011 : Rewards in Independent MRO and Air charter business are not

lucrative enough to motivate more entrepreneurs.

H111 : Rewards in Independent MRO and Air charter business are

lucrative enough to motivate more entrepreneurs.

Importance of the Research :

This research has sought to identify the factors effecting the evolutions,

sustenance and further growth of entrepreneurs in Independent Aviation

maintenance and Air Charter business. An endeavor has been made to study

the impact of these factors in the motivation of entrepreneurs and its effect

on the risk bearing capacity of entrepreneurs. The research is expected to

help the budding entrepreneurs by providing reference literature for them to

take decision and focus on areas which need attention for success in these

two sectors of Aviation industry. It would also help the industry at large.

70
 CHAPTER IV

RESEARCH METHODOLOGY

71
 CHAPTER IV

RESEARCH METHODOLOGY

Secondary data was collected from various Journals, Books, Research

papers, Theses, Internet, Annual reports and Industry magazines. Data was

also collected from Ministry of aviation, Air port authority of India (AAI),

Centre for Asia Pacific Aviation (CAPA), Business Aviation Association of

India (BAAI), International Civil Aviation organization (ICAO) and The

International Air Transport Association (IATA) data sources.

After the identification of gaps and finalization of research objectives a

questionnaire was prepared and a study was conducted on a pilot scale and

a few entrepreneurs were interviewed to get an initial opinion to decide the

factors to be taken into consideration to get the desired result from this

research. Later the information garnered from the pilot scale study and the

findings from the literature review were used to prepare a final questionnaire

to be used for the purpose of the research study. Data was collected through

structured interview of entrepreneurs in these two sectors Independent MRO

and Air charter.

Instrument development and measures :

Given the objectives of the research, instrument was developed to measure

1) General facts about the entrepreneurs 2) Financial facts about the

72
entrepreneurs 3) Motivational factors 4) Entry barriers in to the MRO and Air

Charter sectors 6) Evolutionary factors 7) Challenges faced in Sustenance

and 7) Rewards to the entrepreneurs. The data collected included location,

age at which they became entrepreneurs family back ground, personal back

ground i.e whether they did a job and then became entrepreneurs or they

directly became entrepreneurs, initial capital deployed, source of funding etc.

The data collected for internal motivational factors included aviation as a

hobby of any family member or friend (influence of closely associated people

on motivation), own interest in aviation, instinct to take risk (a natural

propensity of mind), desire to take challenges in life, passion towards

aircrafts / flying, strong desire to be ones own master, will to follow ones

dreams and ambitions, while the external motivation factors included money

and glamour.

Similarly data was also collected for Entry barriers - regulators constraints,

infrastructural constraints, capital, control of OEM, unavailability of industry

information, Evolutionary factors industry need based, opportunity based,

innovative idea based, foresight / vision based, Challenges in sustenance

regulatory controls, high cost of operation, difficulty in sourcing spare, getting

skilled man power and retaining them, support from OEM, effect of market

fluctuation, managing cash flow, Rewards monetary, recognition,

satisfaction of employment generation, job satisfaction.

An effort was made to cover maximum number of variants of the factors

73
which affected the evolution and sustenance of entrepreneurs in the purview

of this study. Items of instrument were adapted from various previous studies

according to their relevance to the aviation sectors under study in Indian

context. Effort was taken to ensure that the domains were as relevant as

possible. The pilot stage (phase I) used a larger number of items for each

scale. These were reduced on the basis of the pilot test results to the

instrument that was used for final data collection. Table 4.1 gives a

description of the items used to measure the variables used in this study.

Table 4.1 : Research measures

Variables Items Scale

General - 1. Location Mumbai / Delhi /
Demographic Bangalore
and
Socioeconomic 2. Category MRO / Air charter
variables
(Facts) 3. Age at which you became < 30 yrs
entrepreneur 30 50 yrs
> 50 yrs

4. Family back ground Service / Business

or farming
5. Personal back ground Job to Entrepreneur
Direct Entrepreneur

6. No. of Employees when you < 20

started your enterprise. 20 100
> 100

7. Type of company when you Prop. / Partnership

74
 started your enterprise. Pvt. Ltd.
Public Limited
Financial 1. Initial capital deployed at the < 50 lacs
(Facts) time of starting the enterprise. < 5 crore
> 10 crore

2. Current capital involved < 5 crore

5 50 crore
> 50 crore

3. Source of funding Self / Partner / VC

Family
Bank / Stock mkt.

4. Break even period < 1 yr

1 3 yrs
> 3 yrs

5. Current financial condition Good profit

Average profit
Loss

6. Return on Investment (ROI) Satisfactory

Average
Unsatisfactory
Motivational 1. Aviation as a hobby / job of any Yes / No
factors family member or friend
(Internal &
External) 2. Your own interest in aviation Yes / No

3. Instinct to take risk Yes / No

4. Desire to take challenges in life Yes / No

75
 5. Passion towards aircrafts / flying Yes / No

6. Strong desire to be your own Yes / No

master

7. Will to follow your dream Yes / No

8. Ambitious / desire to make it big Yes / No

in life

9. Money Yes / No

10. Glamour Yes / No

Entry barriers 1. Regulatory constraints Yes / No

(Government &
Industry) 2. Infrastructural constraints Yes / No

3. Capital Yes / No

4. Control of OEMs Yes / No

5. Unavailability of Data / reports Yes / No

Evolutionary 1. Industry need based Yes / No

factors
(Internal & 2. Opportunity based Yes / No
External)
3. Innovative Idea based Yes / No

4. Foresight / Vision based Yes / No

76
Challenges 1. Regulatory controls Yes / No
faced in
sustenance 2. High cost of operation / fixed Yes / No
(Government & cost
Industry) Yes / No
3. Problem in sourcing spares
Yes / No
4. Retention of skilled man power
Yes / No
5. Support from OEM
Yes / No
6. Affected by market fluctuations
Yes / No
7. Problem managing cash flow

Rewards to 1. Monetary / Financial Yes / No

the
Entrepreneur 2. Recognition in Industry Yes / No
(Internal &
External) 3. Satisfaction of being an Yes / No
employer
Yes / No
4. Job Satisfaction

Pilot Test :
It is always desirable to conduct a pilot test before administering a

questionnaire to the sample. The pilot test has a role in ensuring that the

instrument as a whole functions well without too much variations, which

would be difficult to measure.

Phase I

77
Since the study involves evaluating the factors of evolution and thus finding

their impact on the sustenance of entrepreneurs in those two particular

sectors of the industry, a proper review of the questionnaire was made and a

preliminary examination of the questionnaire was conducted before data was

collected by face to face interview of the entrepreneurs. The purpose of the

test was;

1) To indentify any scales that were difficult to comprehend or had

redundant items and revise them prior to conducting the interview of

entrepreneurs.

2) For reliability testing

3) For testing the correctness of the scales of measurement and validity

evaluation

4) Calculating the variability of population under survey

5) Refine the questionnaire to cover indirect questions covering the

purpose of data collection at the same time not shooting direct

questions to the entrepreneurs

Research scholars, entrepreneurs and faculty at renowned management

institute participated in the phase I of pilot test. Since the questionnaire was

addressed at matured entrepreneurs, it was necessary to test it to a similar

kind of group with intellect and maturity levels to answer such questions.

Predominantly the pilot test was conducted of the people in age group of 30

to 50 years who showed entrepreneurial maturity towards the questions in

questionnaire. The pilot test was conducted on actual entrepreneurs,

research scholars and faculty keeping into mind that both academic and

78
industry inputs are tested before finalization of the questionnaire for relevant

data collection.

Suggestions received during the pilot study included framing indirect

questions, thus not embarrassing the entrepreneurs with odd questions at

the same time gathering all the required information out of them. Some of the

suggestions also included casual chat with the entrepreneurs during the face

to face interview to know more about them and then include that information

in the final summery of questionnaire. According to the suggestions and

results, the initial pool of items was revised and some corrections made in

the final questionnaire. After ensuring that validity and reliability were

adequate, several categories were reduced to 7 categories consisting of 41

relevant factors for this study. This involved testing the dimensionality for all

the factors using factor analysis. This practice of reducing and refining the

factor items has been used by many previous researchers during the scale

development process (Michael henrehan and Sirkosky 1978, Rubin marto,

1994 and Fenwisk 1975). Due to the limited size of the population, the whole

population was selected as the sample.

Phase II

The questionnaire finalized after Phase I was tested with some known

entrepreneurs related to Independent MRO at Mumbai to identify whether the

questionnaire suffered any major drawbacks and whether the questions

needed to be restructured. Reliability tests gave acceptable results and

indicated that factors must be measure on two scale (yes or no) to reduce

79
the variance. The data from this stage was incorporated into the final data

sheet.

Validity and Reliability :

Validity

Based on the literature review and followed by the pretest survey (Phase I),

items were generated to operationalise the variables under study. A measure

is considered valid to the degree that it really does measure what it is

intended to measure. The internal validity can be discussed as under :

1) Face validity or content validity, 2) Construct validity 3) Criterion validity

and 4) Measurability (copper and schindler, 2003)

Face validity

The face validity or content validity of a measuring instrument is the extent to

which it provides adequate coverage of the investigative questions guiding

the study. Determination of content validity is judgmental and can be

approached is several ways (Cooper and Schindler, 2003). In this study, the

first step involved a careful definition of evolution of entrepreneurs and the

factors to be scaled and the scales to be used. Further, these factors were

evaluated through conducting a screening exercise or judgmental method

(Litwin, 1995; Sekaran, 1992). The aim of the exercise was to determine the

extent to which each factor reflected dimensions of effect on entrepreneurs.

Construct validity

80
In the measuring construct validity, both theory and the measuring instrument

are considered. Once it is established that the constructs are meaningful in a

theoretical sense, the adequacy of the instrument is investigated. In order to

ensure that items measure hypothetical concepts, evolution and sustenance

factors or entrepreneurs from other industries studied in previous research

were used.

The adequacy of an instrument can be tested either through convergent

validity or discriminant validity. Convergent validity involves correlating the

results of the present study with pre-existing validated scales. In their

absence or of they having not used, the construct validity of a measure is

shown by showing that it related to other variables to which it should be

related (Campbell and Friske, 1959; green and Tull, 1980). Internal

consistency therefore is a good test for construct validity. The factors were

checked to identify whether the factors of motivation, entry barrier, evolution

and sustenance formed sensible relationships with the general and financial

facts through correlations and cross table analysis. Beyond internal

consistency, evidence for new factoral scales is difficult to find. The most

general practice is to assume, unless there is evidence to the contrary that

the respondent is responding accurately. Much stronger evidence on

construct validity can come from category by category and factor by factor

convergent and discriminant validity. Discriminant validity involves seperating

it from other constructs in theory or related theories. While these have not

been attempted, here factor analysis has been used to establish the constuct

adequacy of the measuring device (Cooper and Schindler, 2003).

81
Criterion Validity

Criterion related validity reflects the success of measure used for prediction

or estimation. Cooper and Schindler (2003), suggests that any criterion

measure must be judged in terms of four qualities : 1) Relevance 2) Freedom

from bias 3) Reliability and 4) Availability. A criterion is relevant if it is defined

and scored in terms we judge to be a proper measure. Freedom from bias is

attained when the criterion gives each respondent an equal opportunity. A

reliable criterion is stable or reproducible. Finally, information specified by the

criterion should be available. After these were ensured, the criterion validaty

was established in this study by correlating the factors affecting evolution and

sustenance of entrepreneurs in MRO and Air charter business. Predictive

validity is established by the ability to predict the summed or averaged

behavior of large numbers of individuals. Discriminant analysis was used to

establish that the constructs under study had validity 9Cooper and Schindler,

2003; Wells 1975)

Validation of Discriminent model

Validation of the discriminent model was ensure by segregating the sample

of both the segments i.e MRO and Air charter into two. The internal validity of

the discriminant function was calculated using the levels of predictive

accuracy. A cross classification of the results with the original classification

indicated the accuracy of prediction. An acceptable overall hit ratio for both

the samples under study is considered as support for the discriminant model

(Hair et al).

82
Table 4.2 : Summary of Internal Validity methods

No Type What is measured ? Methods used

1 Content Validity Degree to which the Choice of relevant

content of the catagory dimensions from

adequately represents existing literature.

the universe of all Researchers

relevant factors under judgement

study Panel evaluation

2 Construct Validity Attempts to identify the Internal consistency

underlying constructs Factor analysis

being measured and

determine how well the

test represents them

3 Criterion Validation Degree to which the Correlations

predictor is adequate in Cross table analysis

capturing the relevant Discriminant analysis

aspects of the criterion

Reliability

Reliability of a factor, measures how consistent or stable the ratings

generated by the factor are likely to be. Reliability focuses on whether the

factor consistently measures the construct or not. (Parashuraman, Grewal

and Krishnan, 2007). Reliability is therefore concerned with the estimates of

the degree to which measurement is free of random or unstable error.

83
Reliable instruments can be used with confidence that transient and

situational factors do not much interfere. Mathematically, reliability is defined

as the proportion of the variability in the responses to the survey that is the

result of differences in the respondents. That is, answers to a reliable survey

will differ because respondents have different opinions or went through

different situation, not because the survey was confusing or has multiple

interpretations. Reliable instruments are robust and, they work well at

different times and under different conditions. This distinction of time and

condition is the basis for frequently used perspectives on reliability: Stability,

Equivalence and Internal consistency. While stability of a scale measure the

reliability whether consistent results can be secured with repeated measures

of the same person with the same instrument, equivalence is concerned with

variations at one point in time among observers and samples of items.

Ideally, in order to obtain a good estimate of the reliability of a survey, we

would like to administer the survey twice to the same group of people and

then correlate the two sets of results. However, this is often impractical

because bias may be introduced in the second set of answers or because

respondents may be unwilling or unable to take the survey a second time.

Sample design :

For the purpose of research, the data has been collected from Mumbai, Delhi

and Bangalore due to the concentration of aviation related businesses in

these 3 cities in India. To get a clear understanding of the factors effecting

sustenance and growth of entrepreneurs in aviation maintenance and Air

Charter business, the following determinants have been studied in detail:

84
 General facts / background of the respondents.

Financial facts about the respondents.

Motivational factors for entrepreneurs.

Entry barriers in aviation maintenance sector.

Evolutionary factors

Challenges faced in sustenance.

Rewards to the entrepreneurs

Samples Size :

In this study the population size was very limited and hence 100% population

was considered as the sample and each member of the population was

carefully examined and interviewed.

Due to the limited number of entrepreneurs in Aviation maintenance and Air

Charter businesses, primary survey was conducted for the whole population

without applying any sampling technique.

Table 4.3 : Population of MRO and Air Charter entrepreneurs

Sr. CITY No of Independent No. of Air Charter

No MRO companies
1 Mumbai 7 9

2 Delhi 8 9

3 Bangalore 3 1

Total 18 19

Source : Director General of Civil Aviation CAR-145 companies (DGCA)

85
 10
8
6
4
2 No of Independent MRO
0 No. of Air Charter companies

Data Collection and measures to reduce sample bias :

Given the nature of this research, a face to face interview was preferred. A

questionnaire was used to give structure to the interview and keep the

questions specific to the determinants under evaluation. The rationale is

based on the theory that respondents will be more attentive to the questions

asked during the face to face interview when they informal and comfortable

with the researcher (Dawson et al, Blair, 1983). Opinion of the respondents

were recorded in simple two alternate method (Yes / No).

Data Processing and Analysis :

The data collected through interviews with the help of questionnaire was then

analysed using Statistical Package for Social Sciences (SPSS) version 12.0.

Descriptive statistics, bivariate analysis and multivariate analysis were

adopted.

86
Descriptive

The general and financial facts are described using multiple scales relevant

to each fact and means have been used to describe high, average and low

significance. Each parameter was converted into a numerical value 1, 2 and

3 depending on the significance, where 1 measure low and 3 highest. For

some of the facts the numbers 1, 2 and 3 were classified and did not show

any significance.

Bivariate

Cross table analysis

Cross table analysis or cross tabulation is a technique for comparing data

from two categorical variables. Cross table is the first test in identifying

relationships between variable of two different categories. The technique

uses tables having rows and columns that correspond to each variable

category. Each cell contains a count of cases of joint classification and also

the row and column and the total percentages. Cross table analysis is used

to describe the significance of entrepreneurs of each category i.e MRO and

Air charter with respect to each factor under analysis.

Multivariate

Factor Analysis

Principal component analysis with varimax rotation was used on the

questionnaire items for general facts (7 items), Financial facts (6 items),

Motivational factors (10 items), Entry barriers (5 items), Evolutionary factors

(4 items), Challenges in sustenance (7 items) and Rewards (4 items) to

87
reduce the data. Principal component analysis is a model of factor analysis

that considers total variance and derives factors that include small

proportions of unique variance. It is appropriate when the primary concern is

a minimum number of factor that are needed to account for maximum

amount of variance.

Factor analysis is a generic name given to a class of multivariate statistical

methods whose primary function is to define underlying structure in the data

matrix. With factor analysis, the researcher can first identify the separate

dimensions of the structure and then determine the extent to shich each

variable is explained by each dimension. These dimensions or factors when

interpreted and understood describe the data in much smaller number of

concepts that the original individual variables. Data reduction can be

achieved by calculating scores for each underlying dimention. (Hair et al,

2003)

Testing of Hypothesis

Chi-Square

One of the most commonly used tests of significance is the chi-square test. It

is useful in tests involving nominal data. Using this technique we look for

significant difference between the observed distribution of data among the

categories and the expected distribution based on the null hypothesis.

Testing of the impact of one factor on the other in some other category was

88
accomplished by calculating the chi-square, the degree of freedom, and the

significance impact at 0.5 level. Null hypothesis was framed for each of the

variables and tested for validity. The null hypothesis was rejected for p

values less than 0.05.

Pearson Correlation

The application of correlation is to measure the degree of association

between the sets of metric data (Nargundkar, 2003). The hypothesized facts

to the motivation, entry barriers and sustenance is tested using Pearsons

correlation analysis. The correlation coefficient indicated the strength of the

association between the variables. The sign + or can indicate the direction

of the relationship. The values can range from -1 to +1 with +1 indicating a

perfect positive relationship, 0 indicating no relationship and -1 indicating a

perfect negative relationship (Hair et al 2003). This technique was used to

test the hypotheses.

Limitations of Research :

The data collection was carried out from the existing entrepreneurs who have

been able to survive. There would be several such entrepreneurs who could

not survive and had to close their enterprise. Since there was no information

available about them, it was not possible to conduct their interview. This

could be a limitation of this study as the entrepreneurs who could not survive

would have given important inputs for this study.

89
Entrepreneurial challenges differ in different time periods, specialy depending

upon the condition of the industry, so also the motivation of entrepreneurs

differ in direct co-relation to the industry scenario. This study was carried out

during the recession period of 2008-2010, during which most of the

entrepreneurs were struggling to survive due to the global economic

slowdown and downturn of aviation industry. Their response could be

influenced by the industry scenario.

This study was restricted to Independent maintenance organizations (MRO)

and Air charter operators and hence the inferences may have limitations.

This study can further be extended to other areas of aviation industry.

Some of the respondents were not forthcoming during the interview due to

the tight control of regulatory authorities on Independent MRO and Air

charter business and hence there could be chances that there might be

difference between the actual fact and response recorded.

In many cases the Air charter business was backed up by strong financial

partners and the respondents did not like to reveal information, hence the

actual impact of funding could differ in some cases and this could vary the

conclusions of the research.

90
 CHAPTER V

EVOLUTION OF ENTREPRENEURS

IN INDIA

91
 CHAPTER V

EVOLUTION OF ENTREPRENEURS IN INDIA

Evolutionary phases :

The story of the Indian entrepreneurship is replete with paradoxes and

surprises. During the pre-colonial and colonial era, the entrepreneur was

seen more as a trader-money lender merchant, bound rigidly by caste

affiliations and religious, cultural and social forces ranging from the

philosophy of Karma to the system of joint family. Entrepreneurship as we

understand it today was definitely not forthcoming from this social segment.

A number of political, economic factors too had an inhibiting effect on the

spirit of enterprise among Indians. Lack of political unity and stability,

absence of effective communication systems, existence of custom barriers

and oppressive tax policies, prevalence of innumerable currency system all

these combined together to restrict the growth of native entrepreneurship

until around the third decade of the 19th century. The religious system of

education and the low social esteem accorded to business were the other

potent forces that discourage the emergence of large scale commercial

ventures in the pre-independence India.

The first half of the present century witnessed a gradual change in the

scenario. During this period, there was a visible tendency among the natives

to take to business. The spread of secular education, rising nationalist

feelings and social reform movements must have given a fillip to this initial

phase of the emergence of entrepreneurship. Further, the two world wars

92
and the enormous opportunities they created for the growth of Indian

industrial ventures brought about a radical change in the societal attitudes in

favour of industrial entrepreneurship and broadened the vision of Indian

businessmen. The independent India thus could claim to have created a

conductive climate for spread of entrepreneurship. It is in this broad backdrop

that the later evolution and growth of Indian entrepreneurship has to be

located.

In a mixed economy, as India was defined by architects of this republic, with

the public sector having the definite upper hand, the role of the state

becomes very crucial. By its very nature such an economic system could not

adequately focus entrepreneurs as catalyst of economic development. The

state rather assumed the role of the major entrepreneur. Possibly and

rightfully so, the overriding concern of the newly independent country related

to correcting the anomalies and distortions created by the colonial rule.

Issues like employment generation, distributive justice and balanced regional

development thus occupied the centre stage of industrial policy making in

India. The first Industrial policy resolution of 1948 was a solid statement of

the country's philosophy of growth, the vital aspect of which was

industrialization under government regulation. Naturally neither this policy nor

the subsequent ones made any specific reference to the entrepreneur or

entrepreneurship. It is interesting to note that even the small scale sector,

which later came to be known as 'the breeding ground of indigenous

entrepreneurship', has been promoted and nurtured for its potential for

93
addressing the larger developmental concerns. Such concerns, together with

a gradually expanding public sector had set out a framework of

industrialization where the cornerstones were controls, regulation and

restrictions for the large industries and a wide protective umbrella with

special incentives and institutions for the small ones. This was the scenario

till late 1980s.

In spite of the domineering presence of large and medium enterprises in the

economic scene (the history of many such enterprises goes back to the pre-

independence era) it is the small sector that has always dominated the

inquiries into Indian entrepreneurship. In fact, this is quite characteristic of

many of the developing countries. It is not that the large and medium

enterprises do not manifest entrepreneurship as their small counterparts. The

reason could well be that it is in the small enterprise that the presence of the

entrepreneur, is most visible. Also in a country like India which is vast,

diverse, and less developed, small enterprises have a very definite role to

play not only by contributing towards employment and income generation,

but also in attending to the specific needs of a large proportion of customers.

Their greater visibility may also be attributable to the fact that inspite of all

odds on the policy and market fronts, several thousands of small enterprises

thrive in a large number of production spheres. More importantly, the small

scale sector has helped widen the entrepreneurial base by giving rise to a

new class of entrepreneurs from the ranks of employees, business executive,

technicians and professionals.

94
This has broken the earlier myth that entrepreneurship is an exclusive

domain of the socially conservative, traditional trading communities. In fact,

in a study of small entrepreneurs in the then State of Madras, James Bean

observed that entrepreneurs could emerge from a wide range of social and

economical backgrounds.

Though unrecognized by policy statements, entrepreneurial initiative was

breaking new grounds in the small industry scene over the past four decades

banking mainly upon the ingenuity and determination of individuals. The late

sixties and early seventies also witnessed a few sporadic attempts to create

entrepreneurs from non traditional communities with a view to breaking the

monopoly of the dominant groups and diversifying the entrepreneurial base

in the country. The state of Gujarat was the forefront of this movement.

By the late sixties it became quite evident that two resources are the most

critical (inspite of favourable policies) for development of entrepreneurship,

finance (credit) and managerial capabilities. The industrial policy exercises

were woefully oblivion of these two basic factors though there were

incentives and special institutions. When industrial development picked up in

the sixties the bankers limited credit mainly to established industrialists and

merchants for existing projects with assured success and sufficient

collaterals. A study of 53 projects financed by banks and the Gujarat State

Financial Corporation during the period 1965-68 revealed many interesting

things. More than two thirds of institutional loans were for diversifications and

expansion of existing enterprises. Of the new loans, 30% were given to

95
merchants and traders with adequate financial resources and hence the

required collateral. The entrepreneur's financial stake stood very high in the

transactions at a debt equity ratio 1:1. Such policies evidently were holistic to

an aspiring and an otherwise competent young entrepreneurs but without

enough financial resources and tangible assets. Despite efforts made by a

host of institutions, only less than 20% of the new entrepreneurs have access

to training every year. This means that a large mass of the potential

entrepreneurs are still outside the reach.

Evolution of Entrepreneurs in Independent MRO :

The evolution of entrepreneurs into the Indian Aviation Maintenance sector is

not too old. The Indian aviation industry was liberalized in 1990s and it took

almost a decade to see the entry of entrepreneurs into the MRO industry.

Prior to the liberalization there were a few MROs who handled the repair and

maintenance of general aviation aircrafts, however their operation was

limited to maintaining the business jets.

The below diagram prepared on the basis of study of the market and

interview of entrepreneurs during the research shows that MRO industry in

India developed post liberalization.

96
Exhibit : 5.1 : Evolution of Independent MRO sector in the Indian Aviation
industry

Prior to 1990 1990 to 2006 2007 onwards

In-house Core Competency One Stop shop

Engineering Planning

Airline
Engineering and Engineering and
Planning and line maintenance Planning
Airline

Airframe Airframe
Engine Air Frame Engine
MRO

MRO
Line maintenance Engine Line maintenance
and components Components and components

All work In-house Partial Outsourcing All work Outsourced

Source : CIRSIL report on Analysis of MRO industry in 2009.

Prior to 1990 as such there was no Independent MRO sector in existence.

Most of the airlines carried out all the maintenance and repair work in-house

including the minor as well as major maintenance. This was an era when the

aviation industry was completely regulated by the Aircraft manufacturers and

even the part manufacturers (OEMs) were not allowed to interact with the

Airlines directly. All the spare parts as well as repair requirements of the

airlines were routed through the aircraft manufacturer. The technology was

completely controlled by these aircraft manufacturers and even a minor

maintenance used to be carried out in the presence of engineers deputed by

Aircraft manufacturer. This was called the dark era of Aviation industry in

India. Prior to 1990 India had not significant role in the total aviation industry

of the world, because of very few aircrafts owned by the legacy carriers Air

India and Indian Airlines which flew selected sectors and did not allow the
8
industry to grow.

97
The post liberalization era gave opportunities to entrepreneurs, when the

Indian skies were opened for the private players. During this era the Private

Airlines started operating and it was not possible for them to handle all the

maintenance work in-house, hence they started outsourcing their

maintenance and repair jobs to Independent MROs in the US and Europe.

This opened up opportunities for entrepreneurs in India to explore the MRO

business by setting up small maintenance organisations. Initially, it all began

with labor jobs like cleaning of aircrafts, line inspections and line

maintenance being outsourced, which later progressed into outsourcing of

minor maintenance like breaks and wheels, seats, carpets etc, which were

not critical in nature and did not effect the airworthiness of the aircraft.

In the third phase i.e post 2006, there are more entrepreneurs setting up

MROs to handle complex maintenance jobs in India. The growing complexity

of airframes, systems, engines, and related components is leading to

increased inspection and maintenance time, leading to a higher demand for

MROs. Besides Tighter Safety regulation by Director General of Civil Aviation

(DGCA) leading to a situation where regular upgrades of different aircraft

components are becoming essential, has increased the maintenance

requirements of the airlines. This gave rise to entrepreneurs considering it as

a growing and high potential sector to enter into it.

As the low cost carriers (LCC) started occupying space in the India skies, the

need for MROs was felt, as the LCC model of Airlines did not had provision

for setting up their own maintenance department. The LCC business model

98
had to outsource most of their maintenance work and this intensified the

industry need for local MROs to handle minor as well as major maintenance

work. Since the evolution of MRO sector in India began very late and the

growth was quite slow, the foreign MROs too advantage of the poor

maintenance facilities in India and entered into long term agreements with

the LCC as well as full service airlines in India. Thus the Indian MRO sector

which could have otherwise take off was deprived of the initial momentum.

Due to heavy regulation and tight control of the OEMs over the repair

schemes and repair manuals, India MRO sector had to accept the less

technical jobs like brakes and wheels, seat overhaul and other non-critical

maintenance. OEMs were quick enough to envisage the growth in Asia and

India in specific, so they set up their own MROs at Singapore which

developed as a aviation hub for Asia pacific.

Exhibit 5.2 : Region wise share of MRO market in 2008

Middle Africa; 3% India; 1% East Europe;

East; 4% 2%

Latin America;
4%

China; 4%
Europe; 26%

Asia Pacific;
17%

North America;
39%

Source : Report published by Boeing in the year 2008.

99
The above pie chart shows region wise share of MRO market in 2008. It is

seen that market share of India in the world MRO market is hardly 1 % which

is negligible. The no of aircrafts being inducted in India has almost tripled in

last 5 years, however the pie diagram above shows a grim picture of the

growth of MRO sector in India.

This research through the statistical analysis is an attempt to study the

factors effecting slow growth of entrepreneurs in MRO sector.

Evolution of Entrepreneurs in Air Charter sector :

The Air charter industry has seen a phenomenal growth since its start in the

light of open sky policy implemented by Government of India in the year

1994. The market has experienced quick growth ever since, because of

developments in the genre of aeronautics and increasing demand for

alternate types of air travel services.

In the 1990s the Managing directors, presidents and owners of large

companies in India owned private jets, however they faced several

challenges in owning the aircraft for their personal travel. The main challenge

were infrastructural constraints like very few airports, poor landing and

parking facilities, strict license regime, unavailability of maintenance facility

etc. Thus the growth of Air charter did not happen during that period. Some

of these large business houses shared their personal jets with other equally

successful businessmen in their city. In few cases two or three businessmen

100
jointly owned a single aircraft, like in the example of Kirlosker, Bajaj and

Garwares in Pune. They owned a single aircraft jointly and shared it for their

business travel as well as personal travel. At times this was inconvenient as

the travel dates would clash and priorities had to be adjusted. This gave rise

to the concept of Air Charter, wherein without owning the aircrafts they could

travel by private jets as per the convenience.

Entrepreneurs took advantage of this opportunity and started Air Charter

companies which would rent the aircrafts on a daily basis from business

houses which owned it and offer to other businessmen who wanted to fly in

private jet at the same time could not afford to buy one. This went on for a

while until end of 1990s. Once there was sufficient demand and infrastructure

to support such private jets to fly and land in major cities in India,

entrepreneurs brought in business jets specially for the purpose of

chartering. The growth that came after 2000 was phenomenal as the

economy was growing fast and demand kept rising.

Customers felt convenient chartering aircrafts than owning them, due to the

hassles of operational and maintenance difficulties. Thus Air charter

emerged as a full fledge business in early 2000. Entrepreneurs taking

advantage of the opportunity established Air Charter companies and

designed their business models to cater to the need of the customers. This

business was mostly influenced by the contact that the promoter of Air

Charter company had with the business tycoons of India. One of the

successful models of Air Charter business was to bring in refurbished pre-

101
owned private jets from America where they got these aircrafts at reasonable

price and fly in India. Most of the air charter companies followed this

business model, since this reduced their initial capital investment and they

could offer competitive pricing to meet the needs of the Indian customers.

The Air charter business saw a sharp rise in 2005 when the economy of India

was growing at double digits and the main reason for this sudden spurt was

that "Indian business leaders had began to realise that a business aircraft is

not a luxury but a productivity tool that contributes directly to the bottomline

by allowing them to use their time more productively and respond to

opportunities with agility, whether they are across the country or across the

world". Growing opportunities in B-class cities of India has been the key

market for charter aviation; as more and more businessmen from Mumbai

and Delhi were expanding their businesses in these B-class cisties like

Nashik, Chandigarh, Bhopal, Raipur, Indore etc and had to travel regularly to

these places.

Then came the entry of large business houses in Air Charter business. Tata

Group picked up a significant stake in Bjets - a business jet operator that had

plans to start aircraft charter and fractional ownership programmes in India.

In 2007, 30 business jets were delivered in the country and another 45 are

likely to be delivered in 2008.

While Air Charter business was taking shape, the concept of fractional

ownership evolved. Fractions ownership market has also witnessed a strong

102
demand in recent years, as customers (owners) have the option of buying a

fractional ownership of the aircraft, which ensures cost-effectiveness as well

as convenience of a private jet. As per the Ernst & Young report, owners

have a guaranteed access to 50-400 aircraft hours annually, depending on

their share size

The web has been additionally major issue in the boom of the Air charter

business. It has brought charter commuting within the realm of a much

broader range of clientele by making it easy for people to find an agreeable

charter flight provider. There is no longer any want to hunt down a charter

company in local locators or through contacts in the industry. Any traveler

can presently locate a charter company and contact them online to ensure a

flight.

Now there is a rise in the Air charter services, because of the rising

availability and falling prices, and also due to the rising mobility of the people.

People expect to be able to fly whenever they pick, whether they are going

on fun trips or traveling for work purposes. The popularity of charter services

in particular has also been helped by the growing dissatisfaction of elite

customers with the commercial air carriers, as security measures and delays

have increased.

The survival and growth of the air charter market in India will much depend

on high utilisation of the available fleet which would allow operators to reduce

rates and thus make these services affordable to a larger section of our

103
population and encourage the use of business jets for various purposes.

Also, immediate improvement in infrastructure, more players entering into

this market with a sizeable fleet, relaxation on taxes, airport charges, and

liberal policies by government agencies will encourage investments in this

sector.

The most efficient way of traveling in a private jet is to utilize a charter

service, whether chartering the entire plane or simply a single seat. There is

no reason to obtain one the mortgages of plane ownership, like hiring a pilot.

Charter flights also give more options than part ownership, since it is possible

to obtain a flight at any moment to any location. Shared ownership means

sharing use to the jet, and moreover chancing not being permitted to use the

craft since one of the other owners is making use of it. The simplest and

private way to fly is to lease a whole plane, since it is then an ability to dictate

the time of the flight and its destination, as well as to have exclusive use of

the total plane.

Private jets are leased bynumerous different sorts of traveler, for many

different purposes. Some of these persons pick charter flights as a result of it

provides greater room in their travel arrangements. They may need to fly to a

destination that is badly frequented by the commercial airlines, or to travel at

the spur of the moment. This is particularly true of medical professionals,

who may need to fly unexpectedly and cover the distance rapidly, perhaps in

order to conduc surgery or to transport vital medical supplies.

104
Other charter flight travelers are more concerned with the quality of the

service. They could need to travel as quickly as possible, without needing to

check in early and pass inefficiently through the security checks required for

passengers on a commercial airline flight. Since they are in control of their

own small plane, things can be conducted much more quickly and more

efficient. Efficiency is particularly important for executive travelers, who often

need to spend as little time as can be in the airport and in the air while they

are on their way to an important agenda. Commercial airlines, which only

provide flights on their own schedules, may add significantly to the flight time

by permitting travelers to fly to merely a limited selection of destinations so

that they may have to transfer between numerous flights, using only specified

major airports that are a lot of itmes a substantial distance from the middle of

the nearest city, and requiring extensive check in time.

Another point that is a need for some flyers who choose charter flights is

privacy. The one way in which it is an option to fly with utter privacy is to

lease a plane. There shall be no other people, and the small size of the plane

equates that there will be few crew members on board, who will be trained to

be unseen and unobtrusive. This promise of absolute privacy is the reason

why chartered private jets are a popular mode of travel for celebrities, which

includes famous bands and movie stars. Having control who can access to

the craft ensures that passengers keep their privacy, and it also makes a

charter flight safer than a commercial flight for any flyers who may want to

consider security risks. This is the winningest method to travel when there

are any thoughts over the safety of the travelers.

105
Charter flights are also popular with people who are coordinating large

amounts of people, or who might need to transport equipment safely,

specifically when they need to make certain that everything gets there on

time in a remote locale. Lots of film production companies make use of

charter services whenever they are filming on location, for instance.

Off course, the boom in the economy had a significant role to play as well. As

businesses moved beyond the confines of Mumbai, Delhi, Bangalore, etc., to

tier-two and tier-three cities, Air Charter expanded further. Now with 35 non-

metro airports in the pipeline, the Indian aviation story is only going to get

more interesting. However, as increasing numbers of people take to air travel

and the number of aircraft grows in the country, travel through scheduled

carriers is becoming time-consuming for business and first-class travelers.

And that's where another era in Indian Air Charter business begins.

This research through the statistical analysis attempts to study the factors

effecting the sustenance of entrepreneurs in the Air Charter business.

106
 CHAPTER VI

DATA ANAYLYSIS AND HYPOTHESIS

TESTING

107
 CHAPTER VI

DATA ANAYLYSIS AND HYPOTHESIS TESTING

The data analysis and hypothesis testing were carried out using the

computer software package SPSS version 14.0. The relevant results are

enclosed in the appendix. The data was collected over a period of 10 months

on 37 entrepreneurs in Independent MRO and Air Charter businesses in

Mumbai, Delhi and Bangalore. The data collected through the personal

interview of entrepreneurs using a structured questionnaire is tabulated as

below.

Description of the sample

Table 6.1 : Sample Description - Facts

General and Financial fact

Variables Frequency Percentage

Location

Mumbai + Pune 16 43.2

Delhi 17 45.9

Bangalore 4 10.8

Total 37 100

108
 Bangalore; 11%

Mumbai +
Pune; 43%

Delhi; 46%

Location on respondents

Category

Independent MRO 18 48.6

Air Charter 19 51.4

Total 37 100

Independent
Air Charter; MRO; 49%
51%

Category of respondents

Age

< 30 yrs 13 35.1

30-50 yrs 16 43.2

> 50 yrs 8 21.6

109
Total 37 100

> 50 yrs; 22%

< 30 yrs; 35%

30-50 yrs; 43%

Age of respondents

Family Background

Service 18 48.6

Business 17 45.9

Farming 2 5.4

Total 37 100

Farming; 5%

Service; 49%
Business; 46%

Family background of respondents

Personal Background

Job to Entrepreneur 23 62.2

110
Direct Entrepreneur 14 37.8

Total 37 100

Direct
Entrepreneur;
38%
Job to
Entrepreneur;
62%

Personal back ground of respondents

No. of Employees

< 20 12 32.4

20 100 21 56.8

> 100 4 10.8

Total 37 100

Type of Company

Pvt. Ltd. 32 86.5

Public Ltd 5 13.5

Total 37 100

Initial Capital

< 50 lacs 11 29.7

< 5 crores 6 16.2

> 10 crore 20 54.1

Total 37 100

111
 < 50 lacs; 30%

> 10 crore; 54%

< 5 crores;
16%

Initial capital

Current Capital

< 5 crores 1 2.7

5 - 50 crores 7 18.9

> 50 crores 29 78.4

Total 37 100

< 5 crores; 3%

5 - 50 crores;
19%

> 50 crores;
78%

Current capital

Source of funding

Self / Partner / Venture Capital 22 59.5

Family 11 29.7

112
Bank / Stock market 4 10.8

Total 37 100

Bank / Stock
market; 11%

Family; 30%
Self / Partner /
VC; 59%

Source of funding

Break even period

< 1 yr 2 5.4

1 - 3 yrs 17 45.9

> 3 yrs 18 48.6

Total 37 100

< 1 yr; 5%

> 3 yrs; 49%

1 - 3 yrs; 46%

Break-even period

Current financial condition

113
Good Profit 9 24.3

Average Profit 17 45.9

Loss 11 29.7

Total 37 100

Good Profit;
Loss; 30% 24%

Average Profit;
46%

Current financial condition

Current ROI

Satisfactory 9 24.3

Average 14 37.8

Unsatisfactory 14 37.8

Total 37 100

Satisfactory;
24%
Unsatisfactory
; 38%
Average; 38%

Current ROI

114
The general and financial facts of the entrepreneurs interviewed during this

study are tabulated above. It reveals important information about the

entrepreneurs which would help in validating the hypothesis, as well as draw

conclusions about the impact of general and financial factors on the

motivation, capability to over come barriers, factors responsible for the

evolution of the entrepreneurs, challenges faced by them in sustenance and

the rewards to the entrepreneur.

The study reveals that entrepreneurs in the Independent MRO and Air

Charter business are clustered in three cities Mumbai, Delhi and Bangalore.

Out of these three cities most of them are based at Mumbai and Delhi, since

these two cities are the aviation hubs with most number of flights taking off

and landing from these airports. Mumbai and Pune together have 43.2 % of

the entrepreneurs, while Delhi has 45.9 % and Bangalore 10.8 % of the

sample size studied. The total sample of 37 entrepreneurs interviewed

contained 18 (48.6%) from Independent MRO and 19 (51.4%) from Air

Charter.

The data analysis reveals interesting facts about the age at which

entrepreneurs ventured into business. 35.1 % of the entrepreneurs

interviewed had entered into business when they were below 30 years of

age, 43.2 % when they were between 30 to 50 years of age and 21.6 % after

50 years of age. This indicates that 43.2 % of the entrepreneurs entered into

business when they attained certain maturity level and experience to do

business. The second highest percentage was of entrepreneurs who entered

115
into business below 30 years of age. It was interesting to learn during the

interview that most of such young entrepreneurs were highly enthusiastic and

motivated when they decided to get into Independent MRO or Air charter

business. Also the facts reveal that such entrepreneurs came with either a

business family background or started business in partnership. This study

also shows that 21.6% of the entrepreneurs entered into business above the

age of 50 years. This is quite an interesting fact and during the interview it

was found that most of such entrepreneurs always dreamt of doing

something of their own but couldnt gather the courage until they were

financially stable and had enough experience to jump into it. They were more

calculative and ventured into business based on their experience and in the

related field.

Family background plays an important role in the risk taking ability and

motivation of any entrepreneur. Study shows that 48.6 % of the

entrepreneurs came from service class family where their parents were in

service, 45.9 % of the entrepreneurs were with business family back ground

and only 5.4 % from farming background. This shows that entrepreneurs

from upper strata of society got attracted towards Independent MRO and Air

Charter businesses and those who were living in metros or had traveled

abroad and had wider exposure.

Personal background gives an indication about the past experience of the

entrepreneurs. It is seen that 62.2 % of the entrepreneurs came with job

experience and only 37.8 % were the ones who directly entered into the

116
business without any past job experience. It was observed that people with

past job experience had concrete idea of what they were doing. They

followed their past experiences and hence were not too innovative or

adventurous.

Source of funding was studied in detail and hypothesis was framed on the

effect of source of funding in the motivation, capacity to handle entry barriers

and sustenance of entrepreneurs. Data shows that 59.5 % of the

entrepreneurs were self funded or had a financial partner or had a venture

capitalist supporting them. 29.7 % of the entrepreneurs were family funded

and only 10.8 % of the entrepreneurs entered into business with funding from

bank or share market. Such entrepreneurs were the ones who already had

some other business and diversified into aviation with their previous

successful credentials. Facts found during this study reveals that banks have

not played an important role in funding entrepreneurs in MRO and Air

Charter businesses. In further discussion of this research the impact of

source of funding on motivation and other factors has been studied in detail.

ROI (return on investment) is one of the parameters to measure the success

of any industry. Interview of entrepreneurs in MRO and Air charter business

reveals that only 24.3 % of the entrepreneurs were satisfied with the ROI,

while 37.8% said that it was average and the rest 37.8% were unsatisfied

with the ROI. This shows that the returns on investment in both these

businesses are not lucrative, which could be one of the factors for not

attracting many entrepreneurs into this industry. Contrary to the general

117
perception about aviation related business, facts reveal that returns are not

very high i.e it is not a very high margin business due to the continuous

investment in technology up-gradation, training, tools etc and the high

operating costs.

Motivational factors of entrepreneurs

Table 6.2 : Significance of motivational factors in evolution of entrepreneurs

Variables - Motivational factors Frequency Percent

Aviation as a hobby of any family

member or friend

No 28 75.7

Yes 9 24.3

Own Interest in Aviation

No 6 16.2

Yes 31 83.8

Adventurous / Craving to take risk

No 7 18.9

Yes 30 81.1

Desire to take challenges in life

No 5 13.5

Yes 32 86.5

Passion towards Aircrafts / Flying

118
 No 14 37.8

Yes 23 62.2

Being your own master

No 4 10.8

Yes 33 89.2

Follow your dream

No 11 29.7

Yes 26 70.3

Ambitious / Desire to make it big in life

No 11 29.7

Yes 26 70.3

Money

No 13 35.1

Yes 24 64.9

Glamour

No 28 75.7

Yes 9 24.3

Motivation is one of the main factors in the evolution and sustenance of

entrepreneurs. For the purpose of this study 10 motivational factors were

identified and questions related to these 10 motivational factors were

included in the questionnaire. The above table shows a summery of all the

10 motivational factors and their significance as single variant. A correlation

119
of motivation to the other factors is studied during this research and it was

observed that highly motivated entrepreneurs have better sustenance

capacity and greater chances of success. A study of individual motivational

factors gives exact idea of which factors have highest significance and

correlation to the other factors.

Aviation as a hobby of any family member or friend

Table 6.3 : Correlation analysis : Aviation as a hobby of any family member

or friend * Personal back ground

Personal Background Total

1-Job to 2-Direct
Ent Ent.

Aviation as a No Count
hobby of any
family 19 9 28
member or
friend

% within Personal
82.6% 64.3% 75.7%
Background

Yes Count 4 5 9

% within Personal
17.4% 35.7% 24.3%
Background

Total Count 23 14 37

% within Personal 100.0

100.0% 100.0%
Background %

The above Correlation analysis shows that not many entrepreneurs were

motivated by external factor like Aviation as a hobby of any family member or

friend. When compared to the personal background of entrepreneurs who

120
entered into business after being into job, 82.6 % of the respondents within

the group said that they were not motivated by any external factor like family

members or friends, while 64.3 % of the respondents within the group said

they were also not motivated by any external factor. Hence external

motivational factor like Aviation as a hobby of any family member or friend

had less correlation and did not play any role in the evolution of

entrepreneurs in Independent Aviation maintenance and Air Charter

business. This probably indicates that external motivational factor did not had

much impact on entrepreneurs. Further study will help to establish this fact.

Table 6.4 : Chi-Square test for Aviation as a hobby of any family member *
Personal Background

Asymp. Sig. (2-

Value df sided)

Pearson Chi-Square 1.587(b) 1 .208

Chi-square test does not show any significance as the value is much above

0.05. Thus it could be established that entrepreneurs were not motivated by

external factors like influence of family members or friends due to their hobby

of aviation.

Own Interest in Aviation

Table 6.5 : Correlation analysis : Own interest in Aviation * Personal back

ground

Personal Background Total

1-Job to 2-Direct
Ent Ent.
121
 Your own 0-No Count
Interest in 3 3 6
Aviation

% within
Personal
13.0% 21.4% 16.2%
Backgroun
d

1-Yes Count 20 11 31

% within
Personal
87.0% 78.6% 83.8%
Backgroun
d

Total Count 23 14 37

% within
Personal
100.0% 100.0% 100.0%
Backgroun
d

The above correlation table shows that most of the entrepreneurs were self

motivated by their own interest in aviation. Self motivation being an internal

factor acted strong in forcing an entrepreneur to enter into Independent

aviation maintenance and Air charter business. Entrepreneurs with both type

of personal back grounds, those who entered after being into job 87% and

those who entered directly 78.6% show strong significance to internal

motivation factor or own interest in Aviation. This indicates that internal

motivation factors acted as major factor with such high level of correlation

83.8% in encouraging the entrepreneurs to venture into business.

Table 6.6 : Chi-Square test for Own interest in Aviation * Personal

Background

122
 Value Df Asymp. Sig. (2-sided)

Pearson Chi-
.450(b) 1 .502
Square

Though the Chi-Square test does not show significant between own interest

in aviation to the personal back ground of the entrepreneur, it can be seen

that entrepreneurs were internally motivated by their interest in aviation.

Adventurous / Craving to take risk

Table 6.7 : Correlation analysis : Adventurous / Craving to take risk *

Personal back ground

Personal Background Total

1-Job to 2-Direct
Ent Ent.

Adventurous 0-No Count

/ Craving to 7 0 7
take risk

% within Personal
30.4% .0% 18.9%
Background

1-Yes Count 16 14 30

% within Personal
69.6% 100.0% 81.1%
Background

Total Count 23 14 37

% within Personal 100.0

100.0% 100.0%
Background %

Being adventurous is one of the main characteristics of an entrepreneur.

Through this research an attempt has been made to study the significance of

adventurous behavior of the entrepreneurs in their evolution in MRO and Air

Charter business. The above Correlation analysis shows that 69.6% of the

123
entrepreneurs who entered into business after being into job and 100 %

entrepreneurs who entered into business directly said that adventure was

one of the major motivating factor and they had craving for taking risk in life.

Here risk does not mean blind risk, but they all said that they like to take

calculated risks. The total correlation was as high as 81 % which clearly

shows that this was one of the major motivating factor for entrepreneurs with

both types of personal background. More over the direct entrepreneurs show

correlation of 100%, which means all of them were highly adventurous and

had a craving for taking calculated risk in business. Such entrepreneurs were

found to be more successful.

Table 6.8 : Chi-Square test for Adventurous / Craving to take risk * Personal
Background

Value Df Asymp. Sig. (2-sided)

Pearson Chi-
5.255(b) 1 .022
Square

Chi-square results shows significance when these two parameters were put

to test to measure against each other. Chi-square shows significance of

0.022 which is much below 0.05 and hence it is relevant.

Desire to take challenges in life

Desire to take challenges in life is a willingness to take large risks and face

the challenges. Not all men and women have such a behavioral pattern. It is

one of the main characteristics of entrepreneurs, which differentiates them

from others. Through this research an attempt has been made to test the

significance of this characteristic (desire to take challenges) against the facts.

124
Table 6.9 : Correlation analysis : Desire to take challenges in life * Personal
back ground

Personal Background Total

1-Job to 2-Direct
Ent Ent.

Desire to 0-No Count

take
3 2 5
challenges
in life

% within
Personal 13.0% 14.3% 13.5%
Background

1- Count
20 12 32
Yes

% within
Personal 87.0% 85.7% 86.5%
Background

Total Count 23 14 37

% within
Personal 100.0% 100.0% 100.0%
Background

In the Correlation analysis it is found that desire to take challenge shows a

strong correlation irrespective of the personal background of the

entrepreneur. The combined correlation of this factor compared against the

personal back ground is 86.5%, where in the entrepreneurs who came from

job show 87 % correlation and those who became entrepreneur directly show

85.7% correlation.

Though the chi-square does not indicate significance within these two

125
factors, it can be seen that entrepreneurs with both types of personal back

ground had strong desire to take challenges in life.

Similar study has been done for other factors against personal back ground

of the entrepreneurs and it reveals that internal motivational factors had

higher correlation and were significant in comparison to the external factors.

Further comparison of factors against family back ground is described below

for understanding purpose.

Passion towards Aircrafts / Flying

Passion is something which makes even the impossible things happen.

Aviation being a hi-flying industry attracts many entrepreneurs who had

passion for aircrafts or flying. Flying in the sky has always been a dream of

human beings and with the invent of aircraft, it gave wings to this dream.

Some people got into the aviation business because they carried passion

towards the aircrafts.

Table 6.10 : Correlation analysis : Passion towards Aircrafts / Flying * Family

background

Family Background Total

2-
1- Business/F
Service arming

Passion 0-No Count

towards
7 7 14
Aircrafts /
Flying

% within
Family
38.9% 36.8% 37.8%
Backgroun
%
d within
Family
38.9% 36.8% 37.8%
126
Backgroun
d
 1-Yes Count 11 12 23

% within
Family
61.1% 63.2% 62.2%
Backgroun
d

Total Count 18 19 37

% within
Family
100.0% 100.0% 100.0%
Backgroun
d

Family background plays an important role in nurturing passions, moreover

to keep a passion of aircrafts or flying could be very expensive and not

affordable to all. Family back ground also affects the motivation level of an

entrepreneur to a certain extent, hence it becomes important to study the

motivational factors in the backdrop of family back ground. Here family

background relates to whether father was in service or business. For the

shake of convenience farming has been clubbed with business as there were

not many counts for it.

The comparative analysis shows that entrepreneurs had effect of their family

background on their motivation of passion for aircrafts / flying. Respondents

with business family background showed correlation of 63.2% over

entrepreneurs with service family background who showed 61.1%. Hence it

is established that family background has a role in the passion of an

entrepreneur, which in-turn becomes the motivation for him to take large

calculated risks.

Table 6.11 : Chi-Square test for Passion towards Aircrafts / Flying * Family
background.

127
 Value Df Asymp. Sig. (2-sided)

Pearson Chi-
.016(b) 1 .898
Square

Although the chi-square does not show significance, it is observed that family

background may have positive impact on the passion of entrepreneurs.

Being your own master

Table 6.12 : Correlation analysis : Being your own master * Family

background

Family Background Total

2-
1- Business/F
Service arming

Being your 0-No Count

3 1 4
own master

% within
Family
16.7% 5.3% 10.8%
Backgroun
d

1-Yes Count 15 18 33

% within
Family
83.3% 94.7% 89.2%
Backgroun
d

Total Count 18 19 37

% within
Family
100.0% 100.0% 100.0%
Backgroun
d

128
Table 6.13 : Correlation analysis : Being your own master * Personal
background

Personal Background Total

1-Job to 2-Direct
Ent Ent.

Being your 0-No Count 4 0 4

own master

% within 17.4% .0% 10.8%

Personal
Backgroun
d

1-Yes Count 19 14 33

% within 82.6% 100.0% 89.2%

Personal
Backgroun
d

Total Count 23 14 37

% within 100.0% 100.0% 100.0%

Personal
Backgroun
d

The above two tables show the Correlation analysis of motivational factor

being your own master to the family background as well as the personal

background of the entrepreneurs. In both the tables the motivational factor

being your own master shows strong correlation when compared to the

family background as well as personal background of the entrepreneurs. In

the first table, entrepreneurs from service family background showed 83.3%

correlation while entrepreneurs from business family background showed

94.7% correlation and combined was 89%. Similarly in the second table,

entrepreneurs who entered into business after doing job showed 82.6%

129
correlation and those who entered directly into business showed 100 %

correlation and combined was 89.2%. These high values of correlation show

that entrepreneurs had will to be their own master in all cases and this acted

as a major motivational factor.

Follow your dream

Follow your dream means find ways to make your dream come true. Dream

is not something that you see while sleeping, but dream is something which

doesnt let you sleep. Most entrepreneurs have been found to carry big

dreams, which they bring into reality by their hard work and dedication. This

could be one of the major motivating factor for entrepreneurs who entered

into Independent aviation MRO and Air Charter business. The following

tables measure its correlation to the family background and personal

background of the entrepreneurs.

Table 6.14 : Correlation analysis : Follow your dream * Family background

2-
1- Business/F
Service arming

Follow your 0-No Count

7 4 11
dream

% within
Family
38.9% 21.1% 29.7%
Backgrou
nd

1-Yes Count 11 15 26

% within
Family 61.1% 78.9% 70.3%
Backgrou

130
 nd

Total Count 18 19 37

% within
Family
100.0% 100.0% 100.0%
Backgrou
nd

Table 6.15 : Correlation analysis : Follow your dream * Personal

background

Personal Background Total

1-Job to 2-Direct
Ent Ent.

Follow your 0-No Count

8 3 11
dream

% within
Personal
34.8% 21.4% 29.7%
Backgrou
nd

1-Yes Count 15 11 26

% within
Personal
65.2% 78.6% 70.3%
Backgrou
nd

Total Count 23 14 37

% within
Personal
100.0% 100.0% 100.0%
Backgrou
nd

The above 2 tables compare the correlation of follow your dream as a

motivational factor to family and personal background of entrepreneurs. In

the first table entrepreneurs with service family background showed 61.1 %

131
correlation, while those with business family background showed 78.9%

correlation and a combine of 70.3%. In the second table, entrepreneurs who

entered into business after being into job showed 65.2% correlation, while

those who entered into business directly showed 78.6% correlation and a

combine of 70% correlation. These higher values of correlations indicate that

irrespective of the family and personal background of entrepreneurs follow

your dream was a major motivating factor for them to enter into Independent

aviation MRO and Air charter business.

Money

It is a general perception that money is the biggest motivator for most people

to do things in life. Through the statistical analysis, an attempt has been

made to study the impact of money as a motivational factor for entrepreneurs

to venture into MRO and Air Charter business.

Table 6.16 : Correlation analysis : Money * Family background

Family Background Total

2-
Business/
1-Service Farming

Money 0-No Count 5 8 13

% within
Family 27.8% 42.1% 35.1%
Background

1-Yes Count 13 11 24

% within
Family 72.2% 57.9% 64.9%
Background

Total Count 18 19 37

132
 % within
Family 100.0% 100.0% 100.0%
Background

Table 6.17 : Correlation analysis : Money * Personal background

Personal
Background Total

1-Job to 2-Direct
Ent Ent.

Money 0-No Count 9 4 13

% within
Personal 39.1% 28.6% 35.1%
Background

1-Yes Count 14 10 24

% within
Personal 60.9% 71.4% 64.9%
Background

Total Count 23 14 37

% within
Personal 100.0% 100.0% 100.0%
Background

The tables above reveal interesting facts about money as a motivational

factors for entrepreneurs to enter into business. Money is an external

motivation factor. In the first table, entrepreneurs with service family

background showed 72.2% correlation when compared to the entrepreneurs

with business family background who showed 57.9% correlation. This shows

that entrepreneurs from service family background were more attracted

towards money in comparison to the entrepreneurs who came from business

133
family background. In the second table, entrepreneurs who entered into

business after being into job showed a correlation of 60.9% over

entrepreneurs who directly entered into business, showing correlation of

71.4%. This shows that entrepreneurs who directly entered into business had

eye on money. Overall money remained as one of the motivating factors to

the entrepreneurs irrespective of their personal and family backgrounds.

Glamour

It is a fact that aviation has some component of glamour attached to it and

this attracts many entrepreneurs towards it. However glamour is an external

motivating factor and its significance to entrepreneur in his overall business

sense needs to be established.

Table 6.18 : Correlation analysis : Glamour * Family background

Family Background Total

2-
1- Business/F
Service arming

Glamour 0-No Count 12 16 28

% within
Family 66.7% 84.2% 75.7%
Background

1-Yes Count 6 3 9

% within
Family 33.3% 15.8% 24.3%
Background

Total Count 18 19 37

% within
Family 100.0% 100.0% 100.0%
Background

134
Table 6.19 : Correlation analysis : Glamour * Personal background

Personal Background Total

1-Job to 2-Direct
Ent Ent.

Glamour 0-No Count 18 10 28

% within
Personal
78.3% 71.4% 75.7%
Backgroun
d

1-Yes Count 5 4 9

% within
Personal
21.7% 28.6% 24.3%
Backgroun
d

Total Count 23 14 37

% within
Personal
100.0% 100.0% 100.0%
Backgroun
d

The above two tables reveal that, Glamour as a motivational factor did not

show high correlation to the entrepreneurs. In the first table only 33.3% of the

entrepreneurs with service family background and 15.8 from business family

background, thus a total of 24.3% of the entrepreneurs, felt that Glamour was

a motivational factor. Similarly in the second table only 21.7% who came

from job background and 28.6% who entered directly into business, showed

correlation towards Glamour as a motivational factor. Thus not much

correlation, and it could be established that Glamour did not act as a

motivation for most of the entrepreneurs surveyed during this research.

135
Entry barriers faced by entrepreneurs

Table 6.20 : Entry barriers in the evolution of entrepreneurs

Variables - Entry barriers Frequency Percent

Difficulty in getting Permissions /

Approvals

No 13 35.1

Yes 24 64.9

Infrastructural constraints

No 22 59.5

Yes 15 40.5

Capital Intensive

No 23 62.2

Yes 14 37.8

Control of OEMs

No 22 59.5

Yes 15 40.5

Unavailability of data

No 16 43.2

Yes 21 56.8

Entry barriers are the hurdles faced by the entrepreneurs when getting into

the MRO and Air charter industries and these are the main factors affecting

the evolution of entrepreneurs. For the purpose of this study 5 entry barriers

136
were identified and questions related to these 5 entry barriers included in the

questionnaire. The above table shows a summery of all the 5 entry barriers

and their significance as single variant. A correlation of these entry barriers

to the other factors is studied during this research and it was observed that

highly motivated entrepreneurs had better capacity to overcome the entry

barriers and those could handle the entry barriers successfully had better

chances of sustenance. A study of each entry barrier gives exact idea of the

factors which have highest significance and correlation to the other factors.

Difficulty in getting Permissions / Approvals

Aviation being a highly regulated industry due to the sensitive nature of its

operation, has difficult norms for getting permissions / approvals. These

difficult norms and lengthy procedures act as barriers to the entrepreneurs

who want to enter into this field. Both Independent MRO and Air Charter

business face these regulatory barriers, however in case of Air charter they

also have to deal with operational regulations while MRO only has to deal

with approval and certification.

Table 6.21 : Correlation analysis : Difficulty in getting Permissions /

Approvals * Motivation

Motivation category Total

Moderate
Low (<4) (4-6) High (>6)

Difficulty in 0-No Count 0 0 13 13

getting
Permissions % within
35.1
/ Approvals Motivation .0% .0% 68.4%
%
category

137
 1- Count
4 14 6 24
Yes

% within
64.9
Motivation 100.0% 100.0% 31.6%
%
category

The above Correlation analysis shows the effect of motivation factor on entry

barrier Difficulty in getting Permissions. 68.4 % of the entrepreneurs who

were highly motivated did not face difficulty in getting permission while

entrepreneurs with moderate and low over all motivation level faced difficulty

in getting permissions. Here permission means license and getting

government approvals to start MRO and Air Charter business.

Table 6.22 : Correlation analysis : Difficulty in getting Permissions /

Approvals * Evolution

Evolutionary category Total

Moder High
Low (1) ate (2) (3-4)

Difficulty in 0-No Count 0 4 9 13

getting
Permissions % within Difficulty
/ Approvals in getting 100.0
.0% 30.8% 69.2%
Permissions / %
Approvals

1- Count
9 7 8 24
Yes

% within Difficulty
in getting 100.0
37.5% 29.2% 33.3%
Permissions / %
Approvals

The Correlation analysis of entry barrier Difficulty in getting permission over

evolution shows that those who faced difficulty in getting permissions did not

138
necessarily face evolutionary problem. Hence this entry barrier does not

show correlation to evolution. Figures show that 69.2 % of the entrepreneurs

did not face high evolutionary problem and 30.8% of the entrepreneurs did

not face moderate evolutionary problems over the entry barrier Difficulty in

getting permission. This particular Correlation does not show relevance of

barrier over evolution.

Infrastructural constraints

Table 6.23 : Correlation analysis : Infrastructural constraints * Motivation

Motivation category Total

Low Moderat High

(<4) e (4-6) (>6)

Infrastructu 0-No Count

ral 1 5 16 22
constraints

% within
Motivation 25.0% 35.7% 84.2% 59.5%
category

1-Yes Count 3 9 3 15

% within
Motivation 75.0% 64.3% 15.8% 40.5%
category

Total Count 4 14 19 37

% within
100.0
Motivation 100.0% 100.0% 100.0%
%
category

The above Correlation analysis of the barrier Infrastructural constraint over

motivational level of the entrepreneur shows that those with high level of

139
motivation did not face much of infrastructural constraint. Here 84.2% of the

entrepreneurs with high level of motivation did not face infrastructural

constraint as a barrier. In over all percentage, 59.5% of the entrepreneurs

with average motivation level did not feel that infrastructural constraint was a

barrier.

Table 6.24 : Correlation analysis : Infrastructural constraints * Evolution

Evolutionary category Total

Moderat High
Low (1) e (2) (3-4)

Infrastructu 0-No Count

ral 4 4 14 22
constraints

% within
Infrastructural 18.2% 18.2% 63.6% 100.0%
constraints

1-Yes Count 5 7 3 15

% within
Infrastructural 33.3% 46.7% 20.0% 100.0%
constraints

Total Count 9 11 17 37

% within
Infrastructural 24.3% 29.7% 45.9% 100.0%
constraints

Here 45.9% of the entrepreneurs showed high evolutionary factor. Within the

category comparison, shows that 63.6% of the entrepreneurs who evolved

better did not face Infrastructural constraint as a barrier. In other words only

20% of the entrepreneurs who faced barrier of infrastructural constraint as a

barrier had high evolutionary problems.

140
Capital Intensive

Table 6.25 : Correlation analysis : Capital intensive * Motivation

Motivation category Total

Moderate High
Low (<4) (4-6) (>6)

Capital 0-No Count 0 5 18 23

Intensive
% within
Motivation .0% 35.7% 94.7% 62.2%
category

1-Yes Count 4 9 1 14

% within
Motivation 100.0% 64.3% 5.3% 37.8%
category

Total Count 4 14 19 37

% within
100.0
Motivation 100.0% 100.0% 100.0%
%
category

The above Correlation analysis does not show correlation between Capital

intensive nature of the MRO and Air Charter business as a barrier against

motivation. Entrepreneurs upto 94.7% who were highly motivated said that

Capital was not a barrier. This is contrary to the normal belief that Capital

intensive nature of the aviation related business acts as a barrier to the

entrepreneurs. In fact this correlation establishes that entrepreneurs with

high level of motivation were able to over come this barrier easily. A further

study shows that 100% of the entrepreneurs with low level of motivation

faced capital as a strong barrier.

Table 6.26 : Correlation analysis : Capital intensive * Evolution

141
 Evolutionary category Total

Moder High (3-

Low (1) ate (2) 4)

Capital 0-No Count

5 4 14 23
Intensive

% within
Capital 21.7% 17.4% 60.9% 100.0%
Intensive

1-Yes Count 4 7 3 14

% within
Capital 28.6% 50.0% 21.4% 100.0%
Intensive

Total Count 9 11 17 37

% within
Capital 24.3% 29.7% 45.9% 100.0%
Intensive

Evolution is an after effect of the ability of entrepreneurs to overcome the

barriers. Table 6.3.7 above is a Correlation comparison of Capital intensive

barrier against the evolutionary level of the entrepreneur in these two sectors

of business. The analysis here shows that 60.9% of the entrepreneurs in

MRO and Air charter business who evolved better did not face Capital as an

entry barrier. This goes to say that evolution did not had any significant effect

on capital as an entry barrier. Only 21.4% of the entrepreneurs faced

evolutionary problems due to capital intensive nature of the industry.

Control of OEMs

Table 6.27 : Correlation analysis : Control of OEM * Motivation

Motivation category Total

142
 Low Moderate High
(<4) (4-6) (>6)

Control of 0-No Count

1 8 13 22
OEMs

% within
Motivation 25.0% 57.1% 68.4% 59.5%
category

1-Yes Count 3 6 6 15

% within
Motivation 75.0% 42.9% 31.6% 40.5%
category

Total Count 4 14 19 37

% within
100.0 100.0
Motivation 100.0% 100.0%
% %
category

The analysis here does not show any correlation between Control of OEMs

as a barrier against the motivation level of the entrepreneur. 68.4% of the

entrepreneurs who were highly motivated did not find control of OEM as a

barrier at the same time 75% of the entrepreneurs with low level of

motivation found control of OEMs as a strong barrier.

Table 6.28 : Chi-Square tests : Control of OEM * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
2.635(a) 2 .268
Square

Chi-square test conducted on these factors did not show significance as the

value of Chi-square is 0.268 which is much above 0.05 significance level.

143
Table 6.29 : Correlation analysis : Control of OEM * Evolution

Evolutionary category Total

Moderate
Low (1) (2) High (3-4)

Control 0-No Count 2 9 11 22

of OEMs
% within
Control of 9.1% 40.9% 50.0% 100.0%
OEMs

1-Yes Count 7 2 6 15

% within
Control of 46.7% 13.3% 40.0% 100.0%
OEMs

Total Count 9 11 17 37

% within
Control of 24.3% 29.7% 45.9% 100.0%
OEMs

The above Correlation analysis does not give a clear indication for impact of

Control of OEMs as a barrier over evolution of entrepreneurs. 50% of the

entrepreneurs who evolved better did not face control of OEM as a barrier,

however 50% of the entrepreneurs who evolved moderate of low faced

Control of OEMs as a barrier.

Table 6.30 : Chi-Square tests : Control of OEM * Evolution

Value df Asymp. Sig. (2-sided)

Pearson Chi-
7.652(a) 2 .022
Square

The chi-square shows significance of Control of OEMs as a barrier over

144
evolution of entrepreneurs, result being 0.022 which is lower that 0.05.

Unavailability of data

Since there is not much research done in this area in the past, entrepreneurs

may have difficulty getting related information and data about the industry.

This would not give them any pattern or trend of entrepreneurial success in

MRO and Air Charter industries for reference. The below analysis may

highlight some of the factors effecting entrepreneurs in the absence of

industry related information.

Table 6.31 : Correlation analysis : Unavailability of data * Evolution

Evolutionary category Total

Moderat High (3-

Low (1) e (2) 4)

Unavailibi 0-No Count

lity of 3 5 8 16
data

% within
Unavailibility 18.8% 31.3% 50.0% 100.0%
of data

1-Yes Count 6 6 9 21

% within
Unavailibility 28.6% 28.6% 42.9% 100.0%
of data

Total Count 9 11 17 37

% within
Unavailibility 24.3% 29.7% 45.9% 100.0%
of data

Unavailability of industry related data does not show correlation between

145
barrier over evolution of entrepreneurs. Although 50% of the entrepreneurs

who evolved successfully found unavailability of information not a barrier, the

other 50% who had difficulty in evolution found it as an entry barrier.

Table 6.32 : Chi-Square tests : Unavailability of data * Evolution

Value df Asymp. Sig. (2-sided)

Pearson Chi-
.483(a) 2 .785
Square

The chi-square test results do not show any significance in this case while

comparing the evolution of entrepreneurs over unavailability of data as a

barrier.

Evolutionary factors

Table 6.33 : Factors significant to the evolution of entrepreneurs

Variables - Evolutionary factors Frequency Percent

Industry Need based

No 22 59.5

Yes 15 40.5

Opportunity based

No 5 13.5

Yes 32 86.5

146
 Idea based

No 20 54.1

Yes 17 45.9

Foresight / Vision

No 16 43.2

Yes 21 56.8

There are several factors, which affect the evolution of entrepreneurs in any

industry. As this research has its focus on studying the evolution of

entrepreneurs in Independent MRO and Air Charter business to find out the

factors of sustenance and growth, it becomes very important that all the

factors effecting the evolution of entrepreneurs are studied in detail and

inferences drawn based on analysis of data. Evolution is the process of

development or growth of individual entrepreneurs in the industry and factors

which affected their development i.e helped them evolve or were the hurdles

in evolution.

For the purpose of this study 4 evolutionary factors - Industry need based,

Opportunity based, Innovative idea based and Foresight / Vision based, were

identified and questions related to these 4 evolutionary factors included in the

questionnaire. The above table shows a summery of all the 4 evolutionary

factors and their significance as single variant. A correlation of these

evolutionary factors to the other factors is studied during this research and it

was observed that highly motivated entrepreneurs evolved better than the

entrepreneurs with lower level of motivation. A study of each evolutionary

147
factor gives exact idea of the factors which have high significance and

correlation to the other factors.

Industry Need based

Table 6.34 : Correlation analysis : Industry need based * Motivation

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Industry 0-No Count 2 9 11 22

Need
based % within
Motivation 50.0% 64.3% 57.9% 59.5%
category

1-Yes Count 2 5 8 15

% within
Motivation 50.0% 35.7% 42.1% 40.5%
category

Total Count 4 14 19 37

% within
Motivation 100.0% 100.0% 100.0% 100.0%
category

It is seen that over all 59.5% of the entrepreneurs who were highly motivated

felt that their evolution was not industry need based. Which means, there

was no need by the industry but the entrepreneurs still evolved. It is hard to

establish such a fact quantitatively with such a study, however the data

analysis shows that Industry need was not significant for the entrepreneurs

who were motivated. 50% of the entrepreneurs with low level of motivation

felt that their evolution was industry need based.

148
Table 6.35 : Chi-Square tests : Industry need based * Motivation

Value Df Asymp. Sig. (2-sided)

Pearson Chi-
.303 2 .859
Square

Further the chi-square tests also do not show any significance of motivation

over industry need based evolution of entrepreneurs. The Chi-square results

show negative significance due to 0.859 which is higher than 0.05 required to

measure the significance.

Table 6.36 : Correlation analysis : Industry need based * Challenges faced in

sustenance.

Challenge category Total

Low
Moderat
(1-4) e (5-6) High (7)

Industry 0-No Count 15 5 2 22

Need
based % within
100.0
Industry Need 68.2% 22.7% 9.1%
%
based

1-Yes Count 10 4 1 15

% within
100.0
Industry Need 66.7% 26.7% 6.7%
%
based

Total Count 25 9 3 37

% within
100.0
Industry Need 67.6% 24.3% 8.1%
%
based

The above table shows that there was not much correlation between the

149
challenges faced by entrepreneurs to the Industry need based evolutionary

factor. Only 8.1% of the entrepreneurs who faced high challenges in

sustenance felt that their evolution was Industry need based, however it

shows a fact that 66.7% of the entrepreneurs who faced less challenges in

sustenance said that their evolution was industry need based as against

68.2% who said no. Thus it could be concluded that the evolutionary factor

Industry need based has less correlation with the challenges faced by the

entrepreneurs in sustenance.

Table 6.37 : Chi-Square tests : Industry need based * Challenges faced in

sustenance

Value df Asymp. Sig. (2-sided)

Pearson Chi-
.125(a) 2 .940
Square

Chi-square test does not show any significance.

Opportunity based

Table 6.38 : Correlation analysis : Opportunity based * Motivation

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Opportunit 0-No Count

2 2 1 5
y based

% within
Motivation 50.0% 14.3% 5.3% 13.5%
category

150
 1-Yes Count 2 12 18 32

% within
Motivation 50.0% 85.7% 94.7% 86.5%
category

Total Count 4 14 19 37

% within
100.0
Motivation 100.0% 100.0% 100.0%
%
category

The data compiled in above table shows high level of correlation between

motivational factors and opportunity based evolution of entrepreneurs. 94.7%

of the highly motivated entrepreneurs said that their evolution was

opportunity based, which means that they saw an opportunity of growth in

MRO and Air Charter and hence ventured into it. Their evolution was based

on their grabbing the opportunity. This emphasizes the fact that

entrepreneurs find their own path in every opportunity that they see. It further

establishes a fact that motivation plays a very important role in making of an

entrepreneur, his evolution and further sustenance.

Table 6.39 : Correlation analysis : Opportunity based * Challenges faced in

sustenance

Challenge category Total

Low (1- Moderat High

4) e (5-6) (7)

Opportunit 0-No Count

3 2 0 5
y based

% within
Opportunity 60.0% 40.0% .0% 100.0%
based

151
 1-Yes Count 22 7 3 32

% within
Opportunity 68.8% 21.9% 9.4% 100.0%
based

Total Count 25 9 3 37

% within
Opportunity 67.6% 24.3% 8.1% 100.0%
based

The above table shows that opportunity based entrepreneurs did not face too

many challenges. It also shows that non of the opportunity based

entrepreneurs in MRO and Air Charter business faced high challenges in

sustenance and only 9.4% of them faced high challenges. 68.8% of the

opportunity based entrepreneurs, said that they faced low challenges.

Hence, it could be said that opportunity based entrepreneurs faced very few

challenges in sustenance.

Table 6.40 : Chi-Square tests : Opportunity based * Challenges faced in

sustenance

Value df Asymp. Sig. (2-sided)

Pearson Chi-
1.102(a) 2 .576
Square

Pearson Chi-square tests do not show any significance.

Idea based

Table 6.41 : Correlation analysis : Idea based * Motivation

152
 Motivation category Total

Low Moderate High

(<4) (4-6) (>6)

Idea 0-No Count

2 10 8 20
based

% within
42.1
Motivation 50.0% 71.4% 54.1%
%
category

1-Yes Count 2 4 11 17

% within
57.9
Motivation 50.0% 28.6% 45.9%
%
category

Total Count 4 14 19 37

% within
100.0 100.0
Motivation 100.0% 100.0%
% %
category

The data above shows that 57.9 % of the entrepreneurs who were highly

motivated, evolved on the basis of their ideas, i.e their evolution was idea

based. It is also observed that 71.4% of the entrepreneurs with moderate

level of motivation did not evolve on the basis of their ideas. Thus is can be

inferred that higher the motivation level, better the idea based evolution. Also

it can be seen that those who evolved on the basis of their ideas, were highly

motivated.

Chi-square tests do not show any significance in this case.

Table 6.42 : Correlation analysis : Idea based * Challenges faced in

sustenance

Challenge category Total

153
 Low
Moderat
(1-4) e (5-6) High (7)

Idea 0-No Count

12 5 3 20
based

% within
60.0% 25.0% 15.0% 100.0%
Idea based

1-Yes Count 13 4 0 17

% within
76.5% 23.5% .0% 100.0%
Idea based

Total Count 25 9 3 37

% within
67.6% 24.3% 8.1% 100.0%
Idea based

Entrepreneurs whose evolution was idea based, faced less challenges.

Above table shows that 76.5% of the entrepreneurs whose evolution was

idea based faced low challenges in sustenance. Non of the idea based

entrepreneurs faced high challenges in sustenance.

Foresight / Vision

Table 6.43 : Correlation analysis : Foresight / Vision * Motivation

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Foresight 0-No Count 3 10 3 16

/ Vision
% within
Motivation 75.0% 71.4% 15.8% 43.2%
category

1-Yes Count 1 4 16 21

154
 % within
Motivation 25.0% 28.6% 84.2% 56.8%
category

Total Count 4 14 19 37

% within
Motivation 100.0% 100.0% 100.0% 100.0%
category

It is seen through the Correlation analysis above that, entrepreneurs with

high level of motivation had high level of foresight and vision. 84.2% of the

entrepreneurs who had high motivation, evolved on the basis of their

foresight and vision towards business. While 75% of the entrepreneurs who

had low motivation did not evolve on the basis of their foresight and vision. It

could be established that entrepreneurs with high motivation also had clear

vision.

Table 6.44 : Chi-Square tests : Foresight / Vision * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi- 12.010(

2 .002
Square a)

The Pearson Chi-Square tests show distinct significance between the two

factors motivation and vision of an entrepreneur.

Table 6.45 : Correlation analysis : Foresight / Vision * Challenges faced in

sustenance

Challenge category Total

Low (1- Moder High

4) ate (5- (7)
6)
155
Foresigh 0-No Count
8 5 3 16
t / Vision

% within
Foresight / 50.0% 31.3% 18.8% 100.0%
Vision

1-Yes Count 17 4 0 21

% within
Foresight / 81.0% 19.0% .0% 100.0%
Vision

Total Count 25 9 3 37

% within
Foresight / 67.6% 24.3% 8.1% 100.0%
Vision

Those who had foresight and clear vision did not face challenges as can be

seen in the table above. Non of the entrepreneurs who had vision and

foresight faced high challenges. Similarly 81% of the entrepreneurs with

foresight and vision faced low challenges.

Challenges faced in Sustenance

Table 6.46 : Significance of Challenges faced in sustenance

Variables Challenges faced in

Sustenance Frequency Percent

Regulatory controls

No 18 48.6

Yes 19 51.4

High cost of operation / Fixed cost

156
No 18 48.6

Yes 19 51.4

Availability of Spares

No 19 51.4

Yes 18 48.6

Difficulty retaining Skilled Man power

No 16 43.2

Yes 21 56.8

Difficulty getting support from OEM

No 20 54.1

Yes 17 45.9

Affected by Market fluctuations

No 19 51.4

Yes 18 48.6

Problem Managing Cash flow

No 23 62.2

Yes 14 37.8

The purpose of this research is to study the evolution and sustenance of

entrepreneurs in Independent MRO and Air charter business. Having tested

the significance of evolutionary factors and established facts, challenges

157
faced in sustenance are discussed in this section. Different variables of

challenges faced are compared against factors that affect the sustenance of

entrepreneurs. Challenges are of 3 types 1) Government 2) Industry and 3)

Economic. The factors of challenges are Regulatory controls, High cost of

operation or salaries, Problem in sourcing spare parts, Difficulty to find and

retain skilled manpower, Difficulty in getting support from OEMs, Effect of

market fluctuations (seasonal, sentimental, socio-economical) and Problem

in managing the funds flow. These variables are studied against evolution

and rewards, which are the immediate pre and post functions affecting the

sustenance of entrepreneurs in MRO and Air Charter business.

Regulatory controls

Table 6.47 : Correlation analysis : Regulatory controls * Motivation

Motivation category Total

Moder
Low ate (4- High
(<4) 6) (>6)

Regulat 0-No Count 0 2 16 18

ory
controls % within
Regulatory .0% 11.1% 88.9% 100.0%
controles

1-Yes Count 4 12 3 19

% within
Regulatory 21.1% 63.2% 15.8% 100.0%
controles

Total Count 4 14 19 37

% within 10.8% 37.8% 51.4% 100.0%

Regulatory

158
 controles

Entrepreneurs with high level of motivation did not face challenge of

regulatory controls. Data shows that 88.9% of the entrepreneurs who were

highly motivated either did not feel that regulatory control was a challenge or

were able to overcome the challenge with ease. Only 15.8% of the highly

motivated entrepreneurs felt that regulatory control was a challenge in their

sustenance. This shows that motivation has high significance in sustenance

of entrepreneurs in MRO and Air charter business. As such the category of

motivation consists mainly of internal motivational factors hence it could be

derived that overcoming the challenges depends on the internal drive of an

entrepreneur.

Table 6.48 : Chi-Square tests : Regulatory controls * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi- 20.025(

2 .000
Square a)

For this distribution, the chi-square test shows high significance.

Table 6.49 : Correlation analysis : Regulatory controls * Rewards

Rewards category Total

Moderate High
Low (1) (2) (3-4)

Regulatory 0-No Count

0 3 15 18
controles

159
 % within
Regulatory .0% 16.7% 83.3% 100.0%
controles

1-Yes Count 6 8 5 19

% within
Regulatory 31.6% 42.1% 26.3% 100.0%
controles

Total Count 6 11 20 37

% within
Regulatory 16.2% 29.7% 54.1% 100.0%
controles

In the above table the correlation of challenge in sustenance Regulatory

control is tested against rewards received by the entrepreneur. It shows that

people who faced high challenge due to regulatory control did not get high

reward. 83.3 % of the entrepreneurs did not get reward due to the challenges

faced in sustenance and only 26.3 % of the respondents said they got high

reward despite facing regulatory control challenges.

Table 6.50 : Chi-Square tests : Regulatory controls * Rewards

Value df Asymp. Sig. (2-sided)

Pearson Chi- 13.255(

2 .001
Square a)

The chi-square test shows significance between challenges faced and

rewards derived.

High cost of operation / Fixed cost

Cost of operation is the total fixed expense done every month irrespective of

160
the turnover. In MRO and Air Charter business the fixed costs are high and

this factor of challenge is studied and evaluated in the below table.

Table 6.51 : Correlation analysis : High cost of operation * Motivation

Motivation category Total

Mode
Low rate High
(<4) (4-6) (>6)

High cost 0-No Count 1 3 14 18

of
operation / % within High
16.7
Fixed cost cost of operation / 5.6% 77.8% 100.0%
%
Fixed cost

1-Yes Count 3 11 5 19

% within High
15.8 57.9
cost of operation / 26.3% 100.0%
% %
Fixed cost

Total Count 4 14 19 37

% within High
10.8 37.8
cost of operation / 51.4% 100.0%
% %
Fixed cost

Study of High Cost of operation as a challenge against motivation of an

entrepreneur shows that 77.8% of highly motivated entrepreneurs were not

affected by High operating cost and it was not a challenge for them. Only

5.6% of the entrepreneurs with low level of motivation felt that high operating

cost was a challenge to them. The operating cost mainly considered in this

study consisted of salaries and maintenance cost. Further 26.3% of the

highly motivated entrepreneurs felt that high operating cost was a challenge.

Hence it shows that for entrepreneurs with high level of motivation high cost

of operation was not a challenge.

161
Table 6.52 : Chi-Square tests : High cost of operation * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
9.815(a) 2 .007
Square

The chi-square test results show significance.

Table 6.53 : Correlation analysis : High cost of operation * Rewards

Rewards category Total

Moder High
Low (1) ate (2) (3-4)

High cost of 0-No Count

operation / 2 2 14 18
Fixed cost

% within
High cost of
11.1% 11.1% 77.8% 100.0%
operation /
Fixed cost

1-Yes Count 4 9 6 19

% within
High cost of
21.1% 47.4% 31.6% 100.0%
operation /
Fixed cost

Total Count 6 11 20 37

% within
High cost of
16.2% 29.7% 54.1% 100.0%
operation /
Fixed cost

Table 6.54 : Chi-Square tests : High cost of operation * Rewards

162
 Value df Asymp. Sig. (2-sided)

Pearson Chi-
8.300(a) 2 .016
Square

The above table shows that high cost of operation had a direct bearing on

rewards. 77.8% of of the entrepreneurs said that returns were not high when

the cost of operation was high. Only 31.6% of the entrepreneurs said that the

rewards were high even though the cost of operation was high. Chi-square

tests show significance. Thus challenges in sustenance have inverse impact

on rewards, more the challenges lesser the rewards. 21.1% of the

entrepreneurs who had low rewards said that high cost of operation is a

challenge.

Availability of Spares

Aviation being a highly regulated and OEM controlled business, spare has

always been a challenge to get. Most entrepreneurs have to buy the spares

from the OEMs at very high cost, more over the lead time to get the spare is

also very high. Hence this becomes a challenge in the sustenance of

entrepreneurs in the MRO and Air charter business, as this increases the

cost and also effects their operations directly.

Table 6.55 : Correlation analysis : Availability of spares * Motivation

Motivation category Total

Moderate High
Low (<4) (4-6) (>6)

Spares 0-No Count 1 6 12 19

163
 % within
5.3% 31.6% 63.2% 100.0%
Spares

1-Yes Count 3 8 7 18

% within
16.7% 44.4% 38.9% 100.0%
Spares

Total Count 4 14 19 37

% within
10.8% 37.8% 51.4% 100.0%
Spares

Table 6.56 : Chi-Square tests : Availability of spares * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
2.576(a) 2 .276
Square

The above tables no correlation between motivation and availability of

spares. 63.2 % of the entrepreneurs with high level of motivation felt that

there is no impact of difficulty in availability of spares as a challenge in

sustenance. While 38.9% of the highly motivated people said that availability

of spares is a challenge in sustenance. The chi-square tests do not show

significance here.

Table 6.57 : Correlation analysis : Availability of spares * Rewards

Rewards category Total

Moderate High (3-

Low (1) (2) 4)

Spares 0-No Count 2 5 12 19

% within
10.5% 26.3% 63.2% 100.0%
Spares

164
 1-Yes Count 4 6 8 18

% within
22.2% 33.3% 44.4% 100.0%
Spares

Total Count 6 11 20 37

% within
16.2% 29.7% 54.1% 100.0%
Spares

Table 6.58 : Chi-Square tests : Availability of spares * Rewards

Value df Asymp. Sig. (2-sided)

Pearson Chi-
1.532(a) 2 .465
Square

Rewards are a type of motivation to the entrepreneurs. The above

Correlation and chi-square tables show that there is not much correlation

between availability of spares and the reward of entrepreneurs. 44.4% of the

entrepreneurs said that rewards had no effect, when the availability of spares

was a challenge. Against which 63.2 % of the entrepreneurs said that

rewards were low when availability of spare was a challenge. As such the

Chi-square tests do not show significance on comparison of these two

factors.

Difficulty retaining Skilled Man power

It is a known fact that aviation needs precision and that requires highly skilled

manpower to do the job. Thus manpower becomes a crucial factor of MRO

and Air Charter business. With the growth in overall Aviation industry trained

manpower has become an acute problem. This research has tried to

understand the impact of skilled manpower as a challenge in sustenance of

165
the entrepreneur.

Table 6.59 : Correlation analysis : Difficulty retaining Skilled man power *

Motivation

Motivation category Total

Low Moderat High

(<4) e (4-6) (>6)

Skilled 0-No Count

Man 2 4 10 16
power

% within
Skilled
12.5% 25.0% 62.5% 100.0%
Man
power

1-Yes Count 2 10 9 21

% within
Skilled
9.5% 47.6% 42.9% 100.0%
Man
power

Total Count 4 14 19 37

% within
Skilled
10.8% 37.8% 51.4% 100.0%
Man
power

Table 6.60 : Chi-Square tests : Difficulty retaining Skilled man power *

Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
1.985(a) 2 .371
Square

Entrepreneurs with high level of motivation did not face the problem of

166
retaining skilled manpower. 62.5% of the highly motivated entrepreneurs did

not feel that retaining skilled manpower was a challenge in sustenance. For

them it was part and parcel of business and they were able to manage it as

other factors. 9.55 of the entrepreneurs with low level of motivation felt that

retaining skilled manpower was a challenge in their sustenance. Also the

42.9% highly motivated entrepreneurs felt that retaining skilled manpower

was a challenge in sustenance. The Chi-Square tests did not show any

significance. Entrepreneurs with high level of motivation were able to keep

the employee turnover low, which had a positive impact on their over all

business.

Table 6.61 : Correlation analysis : Difficulty retaining Skilled man power *

Rewards

Rewards category Total

Moderate High (3-

Low (1) (2) 4)

Difficulty 0-No Count 2 3 11 16

retaining
Skilled % within
Man Skilled Man 12.5% 18.8% 68.8% 100.0%
power power

1- Count
4 8 9 21
Yes

% within
Skilled Man 19.0% 38.1% 42.9% 100.0%
power

Total Count 6 11 20 37

% within
Skilled Man 16.2% 29.7% 54.1% 100.0%
power

167
Table 6.62 : Chi-Square tests : Difficulty retaining Skilled man power *
Rewards

Value df Asymp. Sig. (2-sided)

Pearson Chi-
2.510(a) 2 .285
Square

Rewards are an effect of the challenges faced by the entrepreneur in

sustenance. If the entrepreneur was able to sustain better, rewards were

higher. In the above table, 68.8% of the entrepreneurs said that rewards

were low when there was difficulty in retaining skilled manpower and only

42.9% of the entrepreneurs showed high reward even though they faced

difficulty in retaining skilled manpower. This shows an inverse correlation

between rewards and retaining skilled manpower as a challenge in

sustenance. In this case the Chi-square results do not show any significance.

Difficulty getting support from OEM / Control of OEM

Aviation being a highly regulated industry both from regulatory authorities

and technology inventors, continues to suffer under the tight control of OEMs

who do not share their technology with the world and charge high royalty one

the spares. This is the reason for spare parts being expensive and also poor

or delayed response from OEMs. In some cases the support from OEMs is

very poor and this is a major challenge of aviation industry. Due to the

advance technology, there are several acquisitions and mergers of

manufacturers, hence many times the customers suffer due to this. Some of

the OEMs who are more focused on R&D and manufacturing do not support

after sales service to the customers and this is a major challenge for MROs

168
and Air Charter operators. Also due to the presence of 90% of the OEMs in

US and Europe there is time difference and communication gap, which adds

to the difficulty in getting support from the OEMs. Within the scope of this

study an attempt has been made to measure the impact of poor support from

the OEMs on the over all business of MROs and Air Charter operators and

the challenges faced by them on this front. Although it is difficult to quantify

this factor, it has been categorized and measure the impact on 3 scale.

Difficulty faced by entrepreneurs due to the control of OEMs is measured as

Yes or No and then its significance is measured.

Table 6.63 : Correlation analysis : Control of OEM * Motivation

Motivation category Total

Moderate High
Low (<4) (4-6) (>6)

Control 0-No Count 1 6 13 20

by
OEMs % within
Control by 5.0% 30.0% 65.0% 100.0%
OEMs

1-Yes Count 3 8 6 17

% within
Control by 17.6% 47.1% 35.3% 100.0%
OEMs

Total Count 4 14 19 37

% within
Control by 10.8% 37.8% 51.4% 100.0%
OEMs

Table 6.64 : Chi-Square tests : Control of OEM * Motivation

169
 Value df Asymp. Sig. (2-sided)

Pearson Chi-
3.645(a) 2 .162
Square

Control of OEMs as a challenge, when studied against the correlation of

motivation, did not show correlation. In the table above 65% of the

entrepreneurs with high level of motivation said that control of OEMs was not

a challenge to them in sustenance, while only 35.3% of the entrepreneurs felt

that control of OEMs was a challenge. This shows that highly motivated

entrepreneurs had better capability to over come the challenges and many of

the factors did not affect them as a challenge in sustenance. In this case too

Chi-square did not show any significance.

Table 6.65 : Correlation analysis : Control of OEM * Reward

Rewards category Total

Moderat High (3-

Low (1) e (2) 4)

Control 0-No Count 2 4 14 20

by OEMs
% within
Control by 10.0% 20.0% 70.0% 100.0%
OEMs

1-Yes Count 4 7 6 17

% within
Control by 23.5% 41.2% 35.3% 100.0%
OEMs

Total Count 6 11 20 37

% within
Control by 16.2% 29.7% 54.1% 100.0%
OEMs

170
Table 6.66 : Chi-Square tests : Control of OEM * Reward

Value df Asymp. Sig. (2-sided)

Pearson Chi-
4.471(a) 2 .107
Square

Control of OEM has a direct effect on the rewards of the entrepreneurs, as

the cost of operation increases due to this. In the above table it can been

seen that there is very little correlation between control by OEMs and

rewards to the entrepreneurs. 70% of the entrepreneurs who faced challenge

from control of OEM did not get high reward. 35.3% of entrepreneurs agreed

that they got high rewards despite the fact that there was control of OEM on

the business. The Chi-square tests do not show any significance.

Affected by Market fluctuations

Aviation unlike any other mode of transport has fluctuations based on season

and travel requirements of general public. People travel more during

vacations and festival seasons and hence the passenger load factor of the

airlines vary accordingly. The economic fluctuations also effect the travel

industry and airlines are the most effected. The business travel drastically

reduced when the economy is down and hence this reduces the off season

load factor of the airlines. All these fluctuations in the airlines directly affect

the MRO and Air charter business as both of these are a part of the same

industry and their business depends on the flying of aircrafts. This study is to

know the effect of market fluctuation as a factor of sustenance of

entrepreneurs. Here comparison has been made with motivation level of

171
entrepreneurs and the rewards that they get.

Table 6.67 : Correlation analysis : Effect of market fluctuations * Motivation

Motivation category Total

Low Moderat High

(<4) e (4-6) (>6)

Market 0-No Count

1 9 9 19
fluctuations

% within
Market 5.3% 47.4% 47.4% 100.0%
fluctuations

1-Yes Count 3 5 10 18

% within
16.7
Market 27.8% 55.6% 100.0%
%
fluctuations

Total Count 4 14 19 37

% within
10.8
Market 37.8% 51.4% 100.0%
%
fluctuations

Table 6.68 : Chi-Square tests : Effect of market fluctuations * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
2.170(a) 2 .338
Square

The above table shows correlation between effect of market fluctuation and

motivation of entrepreneurs and vise-versa. 55.6% of the highly motivated

entrepreneurs said that they faced the effect of market fluctuations as

challenge in sustenance. Since market fluctuation is an external factor, it

shows that all entrepreneurs are equally affected by the external factors

irrespective of their motivation level. In the table above 47.6% of the highly

172
motivated entrepreneurs said that market fluctuations did not affect them.

This again shows that motivation does not affect the challenge of market

fluctuations much. The Chi-square tests do not show any significance in this

case.

Table 6.69 : Correlation analysis : Effect of market fluctuations * Rewards

Rewards category Total

Moderate High
Low (1) (2) (3-4)

Market 0-No Count

3 5 11 19
fluctuations

% within
Market 15.8% 26.3% 57.9% 100.0%
fluctuations

1-Yes Count 3 6 9 18

% within
Market 16.7% 33.3% 50.0% 100.0%
fluctuations

Total Count 6 11 20 37

% within
Market 16.2% 29.7% 54.1% 100.0%
fluctuations

Table 6.70 : Chi-Square tests : Effect of market fluctuations * Rewards

Value df Asymp. Sig. (2-sided)

Pearson Chi-
.264(a) 2 .876
Square

Market fluctuation may have direct impact on the rewards of the

entrepreneurs. In the above table 57.9% of the entrepreneurs did not show

173
effect of market fluctuation on the rewards received by them, while 50% of

the entrepreneurs from within the category said that market fluctuations had

effect on rewards. The Chi-square tests do not show significance.

Problem Managing Cash flow

Cash flow is the difference of inflow of fund and out flow of fund in any

company. Problems of cash flow badly effect the business, as shortage of

working capital results in reduced turnover and reduced margin. Cash flow

could be a big challenge in the sustenance of entrepreneurs in the MRO and

Air Charter industries, as problem managing cash flow badly affects the

business. Due to seasonal fluctuations of aviation industry the cash flow

could be a challenge for the MROs which are completely dependent on the

airlines. The below tables show the correlation between cash flow and

motivation as well as rewards.

Table 6.71 : Correlation analysis : Problem managing cash flow * Motivation

Motivation category Total

Low Moderat High

(<4) e (4-6) (>6)

Problem 0-No Count

managin
1 8 14 23
g Cash
flow

% within
Cash 4.3% 34.8% 60.9% 100.0%
flow

1-Yes Count 3 6 5 14

174
 % within
Cash 21.4% 42.9% 35.7% 100.0%
flow

Total Count 4 14 19 37

% within
Cash 10.8% 37.8% 51.4% 100.0%
flow

Table 6.72 : Chi-Square tests : Problem managing cash flow * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
.264(a) 2 .876
Square

The above table shows that problem in managing cash flow as a challenge in

sustenance was not affect by level of motivation. 60.9% of the highly

motivated entrepreneurs had problem managing cash flow. This shows that

level of motivation had little effect on the external factors of challenges.

35.7% of the highly motivated entrepreneurs said that motivation had a role

to play in handling the cash flow challenge. Thus it shows a negative

significance here. Also the Chi-square tests did not show any significance.

Table 6.73 : Correlation analysis : Problem managing cash flow * Rewards

Rewards category Total

Moderat High (3-

Low (1) e (2) 4)

Cash 0-No Count

2 5 16 23
flow

% within 8.7% 21.7% 69.6% 100.0%

175
 Cash flow

1-Yes Count 4 6 4 14

% within
28.6% 42.9% 28.6% 100.0%
Cash flow

Total Count 6 11 20 37

% within
16.2% 29.7% 54.1% 100.0%
Cash flow

Table 6.74 : Chi-Square tests : Problem managing cash flow * Rewards

Value df Asymp. Sig. (2-sided)

Pearson Chi-
6.131(a) 2 .047
Square

Problem managing cash flow cross referred to rewards reveals the fact as in

the above table. 69.6% of the entrepreneurs said that rewards were not high

when there was a challenge of managing the cash flow. Where as 28.6% of

the entrepreneurs said that they received high rewards when there were

challenges of managing the cash flow. In this case the Chi-Square test show

significance.

Rewards

Table 6.75 : Significance of Rewards to the Entrepreneur

Variables - Rewards Frequency Percent

176
 Monetary / Financial

No 16 43.2

Yes 21 56.8

Recognition in the Industry

No 16 43.2

Yes 21 56.8

Satisfaction of being an employer

No 14 37.8

Yes 23 62.2

Job satisfaction

No 4 10.8

Yes 33 89.2

Reward is the result of efforts taken by an entrepreneur. For the convenience

of study rewards are categorized as internal and external. Within the scope

of this research 4 reward factors have been studied and questions related to

them were asked to the entrepreneurs. The first 2 reward factors Monetary /

Financial and Recognition in the industry are considered as the external

reward factors which are beyond the direct control of the entrepreneur. The

second 2 reward factors Satisfaction of being an employer and Job

satisfaction are internal factors of the entrepreneurs. A study of all the reward

factors reveals that rewards have a lot to do with the motivational level of an

entrepreneur and the way he evolves as well as handles the challenges in

sustenance.

177
Monetary / Financial

Monetary reward is a direct reward. It is an external factor and many a times

not within the control of the entrepreneur. Monetary reward could be a major

motivational factor to some of the entrepreneurs and it could a measure of

the success of the entrepreneur. However it varies from entrepreneur to

entrepreneur how much this factor contributes to their total rewards.

Table 6.76 : Correlation analysis : Monetary / Financial * Motivation

Motivation category Total

Low Moderat High

(<4) e (4-6) (>6)

Monetary 0-No Count

/ 3 9 4 16
Financial

% within
Monetary
18.8% 56.3% 25.0% 100.0%
/
Financial

1-Yes Count 1 5 15 21

% within
Monetary
4.8% 23.8% 71.4% 100.0%
/
Financial

Total Count 4 14 19 37

% within
Monetary
10.8% 37.8% 51.4% 100.0%
/
Financial

Table 6.77 : Chi-Square tests : Monetary / Financial * Motivation

Value df Asymp. Sig. (2-sided)

178
Pearson Chi-
7.981(a) 2 .018
Square

The above tables show a positive significance between rewards and

motivation. It shows that level of motivation of an entrepreneur has a direct

impact on the rewards received by him. 71.4% of the entrepreneurs with high

level of motivation said they received high rewards in comparison to the 4.8%

of the entrepreneurs with low motivation level. The values here have clear

significance which reflect that level of motivation has a direct relation to the

rewards received by the entrepreneurs. Higher the motivation, higher the

rewards. The Chi-square tests show significance.

Recognition in the Industry

Recognition is the attention that an entrepreneur gets after achieving certain

level in his business. This is an external reward that an entrepreneur

receives after his achievements are recognized by the industry. Recognition

is a mark of his success as he overtakes the other competitors and makes a

position for himself in the market. Recognition as a reward can not be

measured quantitatively but may a times has greater importance than the

monetary rewards.

Table 6.78 : Correlation analysis : Recognition in the Industry * Motivation

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Recongnit 0-No Count

ion in the 3 12 1 16
Industry

179
 % within
Recongnitio
18.8% 75.0% 6.3% 100.0%
n in the
Industry

1- Count
1 2 18 21
Yes

% within
Recongnitio
4.8% 9.5% 85.7% 100.0%
n in the
Industry

Total Count 4 14 19 37

% within
Recongnitio
10.8% 37.8% 51.4% 100.0%
n in the
Industry

Table 6.79 : Chi-Square tests : Recognition in the Industry * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi- 23.100(

2 .000
Square a)

The above tables clearly show high significance of motivation on industry

recognition received by an entrepreneur. 85.7% of the entrepreneurs with

high level of motivation received industry recognition as a reward and 4.8%

of the entrepreneurs with low level of motivation received recognition as

reward. Chi-square tests show clear significance in this case, showing a

direct correlation between motivation and reward. Higher the motivation of an

entrepreneur, better the reward / recognition in the industry.

Satisfaction of being an employer

180
Table 6.80 : Correlation analysis : Satisfaction of being an employer *

Motivation

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Satisfacti 0-No Count

on of
1 6 7 14
being an
employer

% within
Satisfaction of 100.0
7.1% 42.9% 50.0%
being an %
employer

1-Yes Count 3 8 12 23

% within
Satisfaction of 100.0
13.0% 34.8% 52.2%
being an %
employer

Total Count 4 14 19 37

% within
Satisfaction of 100.0
10.8% 37.8% 51.4%
being an %
employer

Table 6.81 : Chi-Square tests : Satisfaction of being an employer * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
.438(a) 2 .803
Square

The above tables show that satisfaction of being an employer has an impact

of motivation on it. Those who were motivated were more satisfied to be an

employer. 52.2% of the entrepreneurs with high level of motivation were also

181
satisfied to be employers and this acted as a reward to them. Although the

chi-square tests do not shoe significance here, it could be established that

entrepreneurs with high level of motivation received better results of being

satisfied as employers.

Job satisfaction

Table 6.82 : Correlation analysis : Job satisfaction * Motivation

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Job 0-No Count

0 2 2 4
satisfaction

% within Job
.0% 50.0% 50.0% 100.0%
satisfaction

1-Yes Count 4 12 17 33

% within Job
12.1% 36.4% 51.5% 100.0%
satisfaction

Total Count 4 14 19 37

% within Job
10.8% 37.8% 51.4% 100.0%
satisfaction

Table 6.83 : Chi-Square tests : Job satisfaction * Motivation

Value df Asymp. Sig. (2-sided)

Pearson Chi-
.662(a) 2 .718
Square

Entrepreneurs with high level of motivation had higher job satisfaction of

being their own master. They were satisfied by doing their own work, rather

182
than being employed. 51.5 % of the entrepreneurs with high level of

motivation derived better job satisfaction and 12.1% of the entrepreneurs

with low level of motivation derived job satisfaction. To a certain level

motivation and job satisfaction were interrelated. Chi-square does not show

significance.

Results of Hypothesis testing

Family back ground * Motivation

Null Hypothesis H01 : Family background did not play any role in

motivating an entrepreneur to venture into

Independent MRO and Air charter business.

Alternate Hypothesis H11 : Family background did play a role in

motivating an entrepreneur to venture into

Independent MRO and Air charter business.

Validation of hypothesis was tested through Chi-square test. As discussed

above various correlations were studied based on the statistical analysis of

the hypothesis.

Table : 6.84 : Cross tabulation : Family Background * Motivation category

Motivation category Total

Low Moderat High
(<4) e (4-6) (>6)
Family 1-Service Count 3 7 8 18
Backgroun % within
d Family 16.7% 38.9% 44.4% 100.0
%

183
 Backgroun 100.0
16.7% 38.9% 44.4%
d %
2- Count
Business 1 7 11 19
/ Farming
% within
Family 100.0
5.3% 36.8% 57.9%
Backgroun %
d
Total Count 4 14 19 37
% within
Family 100.0
10.8% 37.8% 51.4%
Backgroun %
d

Table : 6.85 : Chi-Square Tests : Family Background * Motivation category

Value df
Pearson Chi-
1.448 2
Square

Validity of Null hypothesis H01 was tested using the Person Chi-square tests.

Here the calculated value at 2 degree of freedom is 1.448. According to the

Chi-square tests, for 2 degree of freedom the table value is 5.99. If the

calculated value is < (less than) the table value, then Chi-Square test is

accepted i.e H01 is accepted and the null hypothesis is valid.

In this case the null hypothesis states Family background did not play any

role in motivating an entrepreneur to venture into Independent MRO and Air

charter business which is accepted through the Chi-square test and hence

the Null hypothesis is valid. Which means that entrepreneurs were not

motivated by their family background which is an external motivating factor.

184
Result : Null hypothesis is valid and accepted and hence the Alternate

hypothesis is rejected.

Monetary reward * Motivation

Null Hypothesis H02 : High profit margin is not a major motivating

factor for entrepreneurs to enter in

Independent MRO and Air charter business.

Alternate Hypothesis H12 : Hight profit margin is a major motivating

factor for entrepreneurs to enter into

Independent MRO and Air charter business.

The Validity of hypothesis was tested through Chi-square tests. Various

correlations related to both the factors of hypothesis were studied and have

been explained in previous pages.

Table : 6.86 : Cross tabulation : Current Financial condition * Motivation

category

Motivation category Total

Moder
Low ate (4- High
(<4) 6) (>6)
1-Good Count
0 1 8 9
Profit
% within
Current 88.9
.0% 11.1% 100.0%
financial %
condition
2- Count
Average 2 10 5 17
Profit
2- Count
Average 2 10 5 17
Profit 185
 % within
Current 11.8 29.4
58.8% 100.0%
financial % %
condition
3-Loss Count 2 3 6 11
% within
Current 18.2 54.5
27.3% 100.0%
financial % %
condition
Total Count 4 14 19 37
% within
Current 10.8 51.4
37.8% 100.0%
financial % %
condition

Table : 6.87 : Chi-Square Tests : Current Financial condition * Motivation

category

Value df
Pearson Chi-Square 9.627 4

Validity of null hypothesis H02 was tested using the Person Chi-square tests.

Here the calculated value at 4 degree of freedom is 9.627. According to the

Chi-square tests, for 4 degree of freedom the table value is 9.49. If the

calculated value is < (less than) the table value, then Chi-Square test is

accepted and if the calculated value is > (greater than) the table value, then

the Chi-square test is rejected, hence the alternate Hypothesis H12 is

accepted and valid.

In this case the null hypothesis states High profit margin is not a major

motivating factor for entrepreneurs to enter in Independent MRO and Air

charter business which is rejected through the Chi-square test, since the

calculated value 9.627 is higher than the table value 9.49 at 4 degree of

186
freedom. Thus the alternate hypothesis H12 is accepted and valid. Which

states that High profit margin was a major motivating factor for entrepreneurs

to enter in Independent MRO and Air charter business.

Result : Null hypothesis is Rejected and hence the Alternate hypothesis is

accepted and valid.

Evolution * Motivation

Null Hypethesis H03 : Motivation has no impact on the evolution of

entrepreneurs in these two sectors of

aviation industry.

Alternate Hypothesis H13 : Motivation has a significant impact in the

evolution of entrepreneurs in these two

sectors of aviation industry.

Validation of hypothesis was done through Chi-square test on data. Various

correlations related to both the factors of hypothesis were studied and have

been explained in previous pages.

Table : 6.88 : Cross tabulation : Evolution * Motivation

Motivation category Total

Low Moderate High
(<4) (4-6) (>6)
Evolutionary Low (1) Count
2 6 1 9
category
% within
Motivation 50.0% 42.9% 5.3% 24.3%
category
Moderat Count 1 6 4 11

187
 e (2)
% within
21.1
Motivation 25.0% 42.9% 29.7%
%
category
High (3- Count
1 2 14 17
4)
% within
73.7
Motivation 25.0% 14.3% 45.9%
%
category
Total Count 4 14 19 37
% within
100.0 100.0 100.0
Motivation 100.0%
% % %
category

Table : 6.89 : Chi-Square Tests : Evolution * Motivation

Value df
Pearson Chi-Square 13.840 4

Validity of null hypothesis H03 was tested using the Person Chi-square tests.

Here the calculated value at 4 degree of freedom is 13.840. According to the

Chi-square tests, for 4 degree of freedom the table value is 9.49. If the

calculated value is < (less than) the table value, then Chi-Square test is

accepted and if the calculated value is > (greater than) the table value, then

the Chi-square test is rejected, hence the alternate Hypothesis H13 is

accepted and valid.

In this case the null hypothesis states Motivation has no impact on the

evolution of entrepreneurs in these two sectors of aviation industry which is

rejected through the Chi-square test, since the calculated value 13.840 is

higher than the table value 9.49 at 4 degree of freedom. Thus the alternate

hypothesis H13 is accepted and valid. Which states that Motivation has a

significant impact in the evolution of entrepreneurs in these two sectors of

188
aviation industry. The entrepreneurs who were highly motivated evolved

better.

Result : Null hypothesis is Rejected and hence the Alternate hypothesis is

accepted and valid. The entrepreneurs who were highly motivated, evolved

better.

Source of funding * Entry Barriers

Null Hypothesis H04 : Source of funding has no impact on the

capability of entrepreneurs to over come

entry barriers in these two sectors.

Alternate Hypothesis H14 : Self and family funded entrepreneurs are

able to overcome the entry barriers easily.

Hypothesis is validated using Chi-square tests. Various individual factor

correlations related to the hypothesis were studied and have been explained
in previous pages.

Table : 6.90 : Cross tabulation : Source of funding * Entry barriers

Barriers category Total

Low Moderat High
(0-1) e (2-3) (4-5)
Source 1-Self / Partner Count
4 10 8 22
of / VC
funding % within
18.2 36.4
Source of 45.5% 100.0%
% %
funding
2-Family Count 6 4 1 11

189
 % within
54.5
Source of 36.4% 9.1% 100.0%
%
funding
3-Bank / Stock Count
2 2 0 4
market
% within
50.0
Source of 50.0% .0% 100.0%
%
funding
Total Count 12 16 9 37
% within
32.4 24.3
Source of 43.2% 100.0%
% %
funding

Table : 6.91 : Chi-Square Tests : Source of funding * Entry barriers

Value df
Pearson Chi-Square 6.938 4

Validity of null hypothesis H04 was tested using the Person Chi-square tests.

Here the calculated value at 4 degree of freedom is 6.938. According to the

Chi-square tests, for 4 degree of freedom the table value is 9.49. Since the

calculated value is < (less than) the table value, then Chi-Square test is

accepted i.e H04 is accepted and the null hypothesis is valid.

In this case the null hypothesis states Source of funding has no impact on

the capability of entrepreneurs to over come entry barriers in these two

sectors which is accepted through the Chi-square test and hence the Null

hypothesis is valid. This means that source of funding did not had much

impact on the capability of entrepreneurs to over come entry barriers.

Result : Null hypothesis is valid and accepted and hence the Alternate

hypothesis is rejected.

190
Initial Capital + Break-even * Entry Barrier

Null Hypothesis H05 : High initial investment and long break even

period is not an entry barrier for

entrepreneurs to enter into Independent

MRO and air charter business.

Alternate Hypothesis H15 : High initial investment and long break even

period is an entry barrier for entrepreneurs to

enter into Independent MRO and air charter

business.

Hypothesis is validated using Chi-square tests. Various individual factor

correlations related to the hypothesis were studied and have been explained
in previous pages.

Table : 6.92 : Cross tabulation : Initial Capital * Entry Barrier

Barriers category Total

Low Moderat High
(0-1) e (2-3) (4-5)
Initial 1- < 50 lacs Count 2 4 5 11
Capital % within
18.2 45.5
Initial 36.4% 100.0%
% %
Capital
2- < 1 crore Count 1 3 2 6
% within
16.7 33.3
Initial 50.0% 100.0%
% %
Capital
3- > 1 crore Count 9 9 2 20
% within
45.0 10.0
Initial 45.0% 100.0%
% %
Capital
Total Count 12 16 9 37
% within 32.4 24.3
43.2% 100.0%
Initial % %

191
 Capital

Table : 6.93 : Chi-Square tests : Initial Capital * Entry Barrier

Value df
Pearson Chi-Square 6.227 4

Table : 6.94 : Cross tabulation : Break-even period * Entry Barrier

Barriers category Total

Low Moderate High
(0-1) (2-3) (4-5)
Break 1- < 1 Count
0 1 1 2
even yr
period % within
50.0
Break even .0% 50.0% 100.0%
%
period
2- 1-3 Count
7 6 4 17
yrs
% within
41.2 23.5
Break even 35.3% 100.0%
% %
period
3- > Count
5 9 4 18
3yrs
% within
27.8 22.2
Break even 50.0% 100.0%
% %
period
Total Count 12 16 9 37
% within
32.4 24.3
Break even 43.2% 100.0%
% %
period

Table : 6.95 : Chi-Square tests : Break-even period * Entry Barrier

Value df
Pearson Chi-Square 2.208 4

Validity of null hypothesis H04 was tested using the Person Chi-square tests

192
as shown in tables 6.92, 6.93, 6.94, 6.95. The null hypothesis here is

measured against 2 variables to one category, we have performed two

separated chi-square tests and tabulated above. Here the calculated values

at 4 degrees of freedom are 6.227 and 2.208. According to the Chi-square

tests, for 4 degrees of freedom the table value is 9.49. Since both the

calculated values are < (less than) the table value, the Chi-Square test is

accepted i.e H05 is accepted and the null hypothesis is valid.

In this case the null hypothesis states High initial investment and long break

even period is not an entry barrier for entrepreneurs to enter into

Independent MRO and air charter business. which is accepted through the

Chi-square test and hence the Null hypothesis is valid. This shows that high

Initial capital and long break-even period were not the entry barriers for them

to enter the MRO and Air charter business.

Result : Null hypothesis is valid and accepted and hence the Alternate

hypothesis is rejected.

Innovative Idea based * Evolution

Null Hypothesis H06 : Evolution of entrepreneurs in the Indian

aviation maintenance and Air charter sectors

was not innovative idea based.

Alternate Hypothesis H16 : Evolution of entrepreneurs in the Indian

193
 aviation maintenance and Air charter sectors

was innovative idea based.

Validity of null hypothesis H06 was tested using Chi-square test, the results of

which are tabulated as below. Chi-square was run after studying all the

factors in details and then catagorise it to get scores.

Table : 6.96 : Cross tabulation : Innovative Idea based * Evolution

Evolutionary category Total

Moderate High (3-
Low (1) (2) 4)
Idea 0-No Count 7 8 5 20
based % within
35.0% 40.0% 25.0% 100.0%
Idea based
1-Yes Count 2 3 12 17
% within
11.8% 17.6% 70.6% 100.0%
Idea based
Total Count 9 11 17 37
% within
24.3% 29.7% 45.9% 100.0%
Idea based

Table : 6.97 : Chi-Square tests : Innovative Idea based * Evolution

Value df
Pearson Chi-Square 7.741 2

Validity of null hypothesis H06 was tested using the Person Chi-square tests.

Here the calculated value at 2 degree of freedom is 7.741. According to the

Chi-square tests, for 2 degree of freedom the table value is 5.99. Since the

calculated value is > (greater than) the table value, Chi-Square test is

rejected i.e H06 is rejected and hence the alternate hypothesis is valid and

accepted

194
In this case the null hypothesis states Evolution of entrepreneurs in the

Indian aviation maintenance and Air charter sectors was not innovative idea

based which is rejected through the Chi-square test and hence the Alternate

hypothesis Evolution of entrepreneurs in the Indian aviation maintenance

and Air charter sectors was innovative idea based is valid and accepted.

Result : Null hypothesis is Rejected and hence the Alternate hypothesis is

valid and accepted.

Industry need base * Evolution

Null Hypothesis H07 : Evolution of entrepreneurs in the Indian

aviation industry (independent MRO and air

charter) was not industry need based.

Alternate Hypothesis H17 : Evolution of entrepreneurs in the Indian

aviation industry (independent MRO and air

charter) was industry need based.

Validity of null hypothesis H07 was tested using Chi-square test, the results of

which are tabulated as below. Chi-square was run after studying all the

factors in detail and then catagorise it to get scores.

Table : 6.98 : Cross tabulation : Industry need based * Evolution

Evolutionary category Total

Low (1) Moder High

195
 ate (2) (3-4)
Industry 0-No Count 8 6 8 22
Need % within
based Industry 36.4% 27.3% 36.4% 100.0%
Need based
1-Yes Count 1 5 9 15
% within
Industry 6.7% 33.3% 60.0% 100.0%
Need based
Total Count 9 11 17 37
% within
Industry 24.3% 29.7% 45.9% 100.0%
Need based

Table : 6.99 : Chi-Square tests : Industry need based * Evolution

Value df
Pearson Chi-
4.428 2
Square

Validity of null hypothesis H07 was tested using the Person Chi-square tests.

Here the calculated value at 2 degrees of freedom is 4.428. According to the

Chi-square tests, for 2 degrees of freedom the table value is 5.99. Since the

calculated value is < (less than) the table value, Chi-Square test is accepted

i.e H07 is accepted and the null hypothesis is valid.

In this case the null hypothesis states Evolution of entrepreneurs in the

Indian aviation industry (independent MRO and air charter) was not industry

need based which is accepted through the Chi-square test and hence the

Null hypothesis is valid. This means that the evolution of entrepreneurs in

these two sector was not based on industry needs.

Result : Null hypothesis is valid and accepted and hence the Alternate

196
hypothesis is rejected.

Regulatory norms * Sustenance

Null Hypothesis H08 : Stringent Regulatory norms are not a

challenge for sustenance of entrepreneurs in

these two sectors of aviation.

Alternate Hypothesis H18 : Stringent Regulatory norms are a challenge

for sustenance of entrepreneurs in these two

sectors of aviation.

Validity of null hypothesis H08 was tested using Chi-square test, the results of

which are tabulated as below. Chi-square was run after studying all the

factors in detail and then catagorise it to get scores.

Table : 6.100 : Cross tabulation : Regulatory norms * Sustenance

Challenge category Total

Low Moderat High
(1-4) e (5-6) (7)
Difficulty in 0-No Count 12 1 0 13
getting % within Difficulty
Permissions / in getting 92.3 100.
7.7% .0%
Approvals Permissions / % 0%
Approvals
1-Yes Count 13 8 3 24
% within Difficulty
in getting 54.2 12.5 100.
33.3%
Permissions / % % 0%
Approvals
Total Count 25 9 3 37

197
 % within Difficulty
in getting 67.6 100.
24.3% 8.1%
Permissions / % 0%
Approvals

Table : 6.101 : Chi-Square tests : Regulatory norms * Sustenance

Value df
Pearson Chi-
5.720 2
Square

Null hypothesis H08 was tested for its validity using the Person Chi-square

tests. Here the calculated value at 2 degrees of freedom is 5.720. According

to the Chi-square tests, for 2 degrees of freedom the table value is 5.99.

Since the calculated value is < (less than) the table value, Chi-Square test is

accepted i.e H08 is accepted and the null hypothesis is valid.

In this case the null hypothesis states Stringent Regulatory norms are not a

challenge for sustenance of entrepreneurs in these two sectors of aviation.

which is accepted through the Chi-square test and hence the Null hypothesis

is valid. Validation of null hypothesis means that stringent regulatory norms

do not effect the sustenance of entrepreneurs.

Result : Null hypothesis is valid and accepted and hence the Alternate

hypothesis is rejected.

Capital Intensive * Sustenance

Null Hypothesis H09 : High Initial Capital and high operating cost is

198
 not a challenge for sustenance of

entrepreneurs in Independent MRO and Air

charter business.

Alternate Hypothesis H19 : High initial cost and high operating cost is a

challenge for sustenance of entrepreneurs in

Independent MRO and Air charter business.

Validity of null hypothesis H09 was tested using Chi-square test, the results of

which are tabulated as below. Chi-square was run after studying all the

factors in detail and then catagorise it to get scores.

Table : 6.102 : Cross tabulation : Capital Intensive * Sustenance

Challenge category Total

Low (1- Moderat High
4) e (5-6) (7)
Capital 0-No Count 18 4 1 23
Intensive % within
Capital 78.3% 17.4% 4.3% 100.0%
Intensive
1- Count
7 5 2 14
Yes
% within
Capital 50.0% 35.7% 14.3% 100.0%
Intensive
Total Count 25 9 3 37
% within
Capital 67.6% 24.3% 8.1% 100.0%
Intensive

Table : 6.103 : Chi-Square tests : Capital Intensive * Sustenance

199
 Value df
Pearson Chi-
3.290 2
Square

Null hypothesis H09 was tested for its validity using the Person Chi-square

tests. Here the calculated value at 2 degrees of freedom is 3.290. According

to the Chi-square tests, for 2 degrees of freedom the table value is 5.99.

Since the calculated value is < (less than) the table value, Chi-Square test is

accepted i.e H09 is accepted and the null hypothesis is valid.

In this case the null hypothesis states High Initial Capital and high operating

cost is not a challenge for sustenance of entrepreneurs in Independent MRO

and Air charter business which is accepted through the Chi-square test and

hence the Null hypothesis is valid. Validation of null hypothesis means that

high initial capital and high operating costs were not a challenge in the

sustenance of entrepreneurs.

Result : Null hypothesis is valid and accepted and hence the Alternate

hypothesis is rejected.

Glamour * Rewards

Null Hypothesis H010 : Glamour attached to the aviation industry

does not attract entrepreneurs to venture into

air charter business despite poor rewards.

200
Alternate Hypothesis H110 : Glamour attached to the aviation industry

attracts entrepreneurs to venture into air

charter business despite poor rewards.

Hypothesis is validated using Chi-square tests. Various individual factor

correlations related to the hypothesis were studied and have been explained
in previous pages.

Table : 6.104 : Cross tabulation : Glamour * Rewards

Rewards category Total

Moder High
Low (1) ate (2) (3-4)
Glamour 0-No Count 6 10 12 28
% within
21.4% 35.7% 42.9% 100.0%
Glamour
1-Yes Count 0 1 8 9
% within
.0% 11.1% 88.9% 100.0%
Glamour
Total Count 6 11 20 37
% within
16.2% 29.7% 54.1% 100.0%
Glamour

Table : 6.105 : Chi-Square tests : Glamour * Rewards

Value df
Pearson Chi-Square 5.985 2

Validity of null hypothesis H010 was tested using the Person Chi-square tests.

Here the calculated value at 2 degrees of freedom is 5.985. According to the

Chi-square tests, for 2 degrees of freedom the table value is 5.99. Since the

calculated value is almost = (equal) to the table value, Chi-Square test is

rejected as a border line case. Here the null hypothesis H010 is rejected and

hence the alternate Hypothesis H110 is accepted and valid.

201
The alternate hypothesis states that the Glamour attached to the aviation

industry attracts entrepreneurs to enter into independent MRO and Air

Charter industries.

Result : Null hypothesis is rejected and hence the Alternate hypothesis is

valid and accepted.

Rewards * Motivation

Null Hypothesis H011 : Rewards in Independent MRO and Air

charter business are not lucrative enough to

motivate more entrepreneurs.

Alternate Hypothesis H111 : Rewards in Independent MRO and Air

charter business are lucrative enough to

motivate more entrepreneurs.

Hypothesis is validated using Chi-square tests. Various individual factor

correlations related to the hypothesis were studied and have been explained

in previous pages.

Table : 6.106 : Cross tabulation : Rewards * Motivation

Rewards category Total

Moderat High
Low (1) e (2) (3-4)

202
Motivation Low (<4) Count 0 3 1 4
category % within
100.0
Motivation .0% 75.0% 25.0%
%
category
Moderat Count
5 6 3 14
e (4-6)
% within
100.0
Motivation 35.7% 42.9% 21.4%
%
category
High Count
1 2 16 19
(>6)
% within
100.0
Motivation 5.3% 10.5% 84.2%
%
category
Total Count 6 11 20 37
% within
100.0
Motivation 16.2% 29.7% 54.1%
%
category

Table : 6.107 : Chi-Square tests : Rewards * Motivation

Value df
Pearson Chi-
17.840 4
Square

Validity of null hypothesis H011 was tested using the Person Chi-square tests

as shown in tables 6.7.23 and 6.7.24. The null hypothesis here is measured

against one category of variable to one category of constant factor. Here the

calculated value at 4 degrees of freedom is17.840. According to the Chi-

square tests, for 4 degree of freedom the table value is 9.49. Since the

calculated value is > (greater than) the table value, the Chi-Square test is

rejected i.e H011 is rejected, hence the alternate hypothesis H111 is valid.

In this case the null hypothesis states Rewards in Independent MRO and Air

charter business are not lucrative enough to motivate more entrepreneurs

203
which is rejected through the Chi-square test and hence the alternate

hypothesis Rewards in Independent MRO and Air charter business are

lucrative enough to motivate more entrepreneurs accepted and valid. This

shows that returns or rewards in both these business sectors are

satisfcatory.

Result : Null hypothesis is rejected, hence the alternate hypothesis is

accepted and valid.

Summary of Hypothesis Validation

Table 6.108 : Summery of Hypothesis acceptability

Sr.No. Null Hypotheses Alternate Hypotheses

H1 Family background did not play Family background did play a

any role in motivating an role in motivating an

entrepreneur to venture into entrepreneur to venture into

Independent MRO and Air Independent MRO and Air

charter business. charter business.

- ACCEPTED - REJECTED

H2 High profit margin is not a major Hight profit margin is a major

motivating factor for motivating factor for

entrepreneurs to enter in entrepreneurs to enter into

Independent MRO and Air Independent MRO and Air

charter business. charter business.

- REJECTED - ACCEPTED

204
H3 Motivation has no impact on the Motivation has a significant

evolution of entrepreneurs in impact in the evolution of

these two sectors of aviation entrepreneurs in these two

industry. sectors of aviation industry.

- REJECTED - ACCEPTED

H4 Source of funding has no impact Self and family funded

on the capability of entrepreneurs are able to

entrepreneurs to over come overcome the entry barriers

entry barriers in these two easily.

sectors.

- ACCEPTED - REJECTED

H5 High initial investment and long High initial investment and long

break-even period is not an break even period is an entry

entry barrier for entrepreneurs barrier for entrepreneurs to

to enter into Independent MRO enter into Independent MRO

and air charter business. and air charter business.

- ACCEPTED - REJECTED

H6 Evolution of entrepreneurs in Evolution of entrepreneurs in

the Indian aviation maintenance the Indian aviation maintenance

and Air charter sectors was not and Air charter sectors was

innovative idea based. innovative idea based.

- REJECTED - ACCEPTED

H7 Evolution of entrepreneurs in Evolution of entrepreneurs in

the Indian aviation industry the Indian aviation industry

(independent MRO and air (independent MRO and air

205
 charter) was not industry need charter) was industry need

based. based.

- ACCEPTED - REJECTED

H8 Stringent Regulatory norms are Stringent Regulatory norms are

not a challenge for sustenance a challenge for sustenance of

of entrepreneurs in these two entrepreneurs in these two

sectors of aviation. sectors of aviation.

- ACCEPTED - REJECTED

H9 High Initial Capital and high High initial cost and high

operating cost is not a challenge operating cost is a challenge for

for sustenance of entrepreneurs sustenance of entrepreneurs in

in Independent MRO and Air Independent MRO and Air

charter business. charter business.

- ACCEPTED - REJECTED

H10 Glamour attached to the Glamour attached to the

aviation industry does not aviation industry attracts

attract entrepreneurs to venture entrepreneurs to venture into

into air charter business despite air charter business despite

poor rewards. poor rewards.

- REJECTED - ACCEPTED

H11 Rewards in Independent MRO Rewards in Independent MRO

and Air charter business are not and Air charter business are

lucrative enough to motivate lucrative enough to motivate

more entrepreneurs. more entrepreneurs.

- REJECTED - ACCEPTED

206
The above table giving acceptability of hypothesis gives facts about the

entrepreneurs in Independent MRO and Air Charter business.

Major findings

The findings of this research could be listed as below.

1 Contrary to the common myth that entrepreneurs from business family

back ground are more successful, this study shows that family

background did not play any significant role in motivating an entrepreneur

and thus in his success.

2 It is very common to hear from the entrepreneurs that they did not start

their business for money and money is not a driving factor. However this

study reveals a different fact, that monetary gain and profit was one of the

major motivating factor for entrepreneurs.

3 This study establishes a fact that motivation plays a very important role in

the evolution of entrepreneurs. Statistical analysis also reveals that

internal motivational facts plays important role in the success of an

entrepreneur in comparison to the external motivating factors, thus

emphasizing that Self motivation was a key to success in business.

207
4 Source of funding for any business is considered to be an important

factor for its growth. Family funded business are considered to be stable

as there is no interest to be paid on the capital. However this study

reveals that source of funding did not had impact on the capability of

entrepreneurs to over come entry barriers. Thus it gives to understand

that entrepreneurs in Independent MRO and Air charter business were

not affected by the source of funding.

5 Aviation is considered to be a capital intensive industry with long break-

even period and all activities related to aviation need high initial

investment. However this study reveals an interesting fact that high initial

investment and long break-even period is not a deterant for

entrepreneurs to enter the Independent MRO and Air charter business.

This shows the determination and motivation level of entrepreneurs which

gives them the capacity to wait for such long periods.

6 This study shows that entrepreneurship in the Independent MRO and Air

charter business was driven by the innovative ideas of the entrepreneurs.

Which means that each entrepreneur has a unique business model to

make his business successful. Moreover in the air charter industry

entrepreneurs were found to be aggressive and innovative and drove

their business on their ideas. Some of the entrepreneurs replicated the

American models of Air Charter with their own ideas and make it

208
 successful.

7 Study shows that evolution of entrepreneurs was not industry need

based, which means that although every industry has needs,

entrepreneurs enter the business based on their perception on

opportunities and not the need of the industry. Thus the entrepreneur has

the capacity to change his business line even when the industry demand

for his product or service decreases.

8 Aviation is a highly regulated industry, however the entrepreneurs

interviewed during this study did not feel it as a challenge. They were

able to over come these challenges by adopting to the requirements of

the industry and organizing themselves accordingly. This shows the

diehard instinct of entrepreneurs and their capability of not accepting the

defeat easily. Entrepreneurs who are able to survive through the

challenges were successful and received rewards. This classifies the

entrepreneurs into a different category.

9 According to the common belief, aviation is a high investment business.

However the entrepreneurs interviewed and the results of hypothesis

testing shows that entrepreneurs in these sectors of aviation were able to

manage the requirements of funds and also the high operating costs.

Since aviation is a high precision industry with various checks and

209
 balances to keep the quality standards high, the operating costs are high.

The research findings show that successful entrepreneurs did not find the

high investment and high operating cost as a challenge in sustenance as

they were able to manage finance. Here it was observed that most of the

Air charter operators were backup by strong financial partners.

10 As discussed in previous chapters, aviation has some component of

glamour attached to it due to the swanky airports, large aircrafts and

charming airhostesses being a part of the business. It attracts attention of

most of the people and thus glamour is a part of this business.

Entrepreneurs are not aloof of this glamour component in this industry.

This research and validation of hypothesis establishes the fact that

entrepreneurs were attracted into Air charter business due to the glamour

attached to it. Air charter is also known as the Hi-flyers industry as it

caters to the super rich customers in India, it requires additional care and

service levels. Hence there is glamour attached to it and this study shows

that glamour had some influence on the entrepreneurs who ventured into

Air charter business.

11 The findings of this research show that rewards in MRO and Air Charter

business were reasonably sufficient to motivate the entrepreneurs into

these two sectors of aviation. Entrepreneurs felt that returns on

investment was reasonable and had long term prospects. Most of

entrepreneurs felt that they will ripe the befit of being into this industry

210
after 2015 when the industry gets matured and more and more people

get habitual of flying.

211
CHAPTER VII

CONCLUSION

212
 CHAPTER VII

CONCLUSION

The primary purpose of the study was to understand the evolution of

entrepreneurs in Independent Aviation MRO and Air Charter sectors of

aviation, study the factors which had positive or negative correlation in the

evolution, and on the basis of those factors study the sustenance and further

growth of entrepreneurs in these two sectors.

To do so, first parameters which affected the evolution process, were studied

using literature on this subject. Since there was not much literature available

on this subject, trade magazines and industry journals were extensively

searched to gather as much information as possible. Available literature did

not indicate any trend or pattern of evolution of entrepreneurs in these two

sectors. Then attempt was made to determine the factors that influenced the

entrepreneurs to enter into these areas. A multi attribute model was also

used to understand the growth of MRO and Air Charter industries in India.

Using this information the profile of entrepreneurs were segregated and their

motivational factors studied.

The analysis of data collected through primary and secondary surveys show

that family background and source of funding did not had much significance

on the motivation level of entrepreneurs. Motivation was the main factor to

effect the capability of entrepreneurs in over coming entry barriers and

sustain in their business.

213
Testing of the hypothesis indicates similar trend and source of funding did

not had much significance on motivation of entrepreneurs. Motivation was

the main criterion of entrepreneurs to affect their risk taking capacity. Level of

motivation had a direct impact on their aggressiveness and thus capacity to

over come the entry barriers with less effort.

The findings of this research brings out an interesting fact that entrepreneurs

were found to be of a different breed and had the maneuvering skills to

handle their business in different situations. Both Independent MRO and Air

Charter businesses being in their nascent stage, require special skills to keep

afloat, move over when these two sectors are capital intensive.

Entrepreneurs interviewed during the survey were found to be highly

motivated and visionary to think ahead of time. This quality of these

entrepreneurs helped them in evolving despite all the challenges.

Table 7.1 Summary of Pearson correlation test

Number Number
of of Number Number
Motivati Number Evolutio of of
onal of n Challeng Reward
Factors Barriers Factors es s

Number of Pearson
Motivation Correlatio 1 -.876(**) .587(**) -.532(**) .531(**)
al Factors n

Sig. (1-
. .000 .000 .000 .000
tailed)

N 37 37 37 37 37

214
Number of Pearson
-
Barriers Correlatio -.876(**) 1 -.531(**) .590(**)
.572(**)
n

Sig. (1-
.000 . .000 .000 .000
tailed)

N 37 37 37 37 37

Number of Pearson
Evolution Correlatio .587(**) -.531(**) 1 -.534(**) .666(**)
Factors n

Sig. (1-
.000 .000 . .000 .000
tailed)

N 37 37 37 37 37

Number of Pearson
-
Challenge Correlatio -.532(**) .590(**) -.534(**) 1
.637(**)
s n

Sig. (1-
.000 .000 .000 . .000
tailed)

N 37 37 37 37 37

Number of Pearson
Rewards Correlatio .531(**) -.572(**) .666(**) -.637(**) 1
n

Sig. (1-
.000 .000 .000 .000 .
tailed)

N 37 37 37 37 37

Results of data analysis by Pearson correlation test gives following

conclusions;

Motivation ! Entry barriers, Evolution, Challenges in sustenance, Rewards.

215
 Those with high motivation faced low entry barriers.

High motivation level is a state of preparedness to handle difficult

situations. The Pearson correlation analysis shows that there is a

negative correlation between motivation and entry barriers.

Entrepreneurs with high level of motivation faced low entry barrier.

(correlation = - 0.876)

Those with high motivation level evolved better.

It is seen that entrepreneurs with high level of motivation evolved

better. Pearson correlation test gives a positive correlation between

motivation and evolution (correlation = 0.587). Entrepreneurs were

able to find solution to the problems and handle things tactfully to

become successful. Evolution is a continuous process and

entrepreneurs with high level of motivation find solution to their

problems with ease. Entrepreneurs with high level of motivation had

clear vision / foresight of what they have to achieve in their business.

They were also innovative and developed their business on the basis

of Innovative ideas.

Those with high level of motivation did not face many challenges.

Entrepreneurs with high level of motivation faced less number of

challenges in sustaining through the tough times and ups and downs

of business. Pearson correlation test shows a negative correlation

between motivation and challenges faced (correlation = -0.532).

Motivation played a key role in the sustenance of entrepreneurs, and

216
 there was a -ve correlation, thus both were inversely proportional.

Challenges remained the same for all the entrepreneurs but those with

positive motivation were able to face the challenges smoothly and

come out as a winner, thus sustain.

Those with high level of motivation received better rewards.

The pearson correlation for these two factors shows a positive

correlation (correlation = 0.531). The entrepreneurs with high level of

motivation received better rewards both monetary and job satisfaction.

Since the motivated entrepreneur had the drive and he faced lesser

challenges, he was able to manage his enterprise better and thus

achieve better results / rewards.

Entry barriers ! Evolution, Sustenance, Rewards

Those who faced less entry barriers evolved better.

The entrepreneurs who faced less entry barriers or to say handled the

entry barriers tactfully, evolved better. They found better opportunities

than others and were able to sell their innovative ideas more

successfully. The Pearson correlation test shows a negative

correlation between entry barriers and evolution (correlation = -0.531).

The negative correlation shows that lesser the entry barriers, better

the evolution. This has a direct impact from motivation level of

entrepreneurs as shown by correlation of motivational factors to

217
 others.

Those who faced more entry barriers also faced more challenges.

The Pearson correlation of entry barriers to Challenges faced in

sustenance shows that the entrepreneurs who faced higher entry

barriers also faced more challenges in sustenance. It shows a positive

correlation between entry barriers and challenges faced (correlation =

0.590).

Higher the entry barriers, lesser the rewards.

The data analysis done through Pearson correlation test shows

negative correlation between entry barriers and rewards, hence higher

the entry barriers lesser the rewards (correlation = -0.572). Since there

are two types of entry barriers observed under this study, government

and industrial, both being external barriers, these need to be

addressed by industry and a proper representation of facts could be

made to reduce the barriers.

Evolutionary factors ! Challenges in sustenance, Rewards

Those who evolved better faced less challenges in sustenance.

The Pearson correlation test shows a negative correlation between

evolution and challenges faced in sustenance (correlation = -0.534).

Entrepreneurs who were able to over come the entry barriers and

218
 evolve successfully, faced lesser challenges in sustenance. Hence it

could be said that during the evolution process entrepreneurs could

judge their further sustenance and they can decide whether their skill

levels are good enough to fit into the industry or not. Many

entrepreneurs eject out during the evolution phase, realizing that their

sustenance may have difficulty later and this could be a good

decision.

Those who evolved better received better rewards.

Reward is the tangible or intangible return that an entrepreneur

receives for the efforts and risks that he takes during his

entrepreneurial journey. In most probability he starts to understand

what rewards he will get after successfully going through the evolution

process and crossing over the sustenance phase. The Pearson

correlation test shows a positive correlation between evolutionary

factors and rewards (correlation = 0.666). Entrepreneurs who evolved

successfully, received better rewards.

Challenges in sustenance ! Rewards

Entrepreneurs who faced more challenges received lesser rewards, or

to say, entrepreneurs who were able to successfully over come the

challenges received better rewards. The Pearson correlation analysis

shows a negative correlation between Challenges faced and rewards

219
 (correlation= -0.637). Entrepreneurs who faced higher challenges in

sustenance received lesser rewards. This clearly indicates that

entrepreneurs who faced higher challenges either had to come out of

business or struggled to continue with very little reward and over a

period of time that may have impact on the motivation level of the

entrepreneur. Challenges are government, industry and market

fluctuation based.

This study adds to the existing literature by throwing light on some of the

facts about entrepreneurship in Indian aviation industry with focus on

Independent aviation maintenance and Charter Aircraft operators, its growth

and sustenance.

The research has focused on examining various factors related to

entrepreneurs related to aviation maintenance and air charter and the

strategies pursued by both highly motivated and innovative entrepreneurs.

One of the contributions of this research is that it provides a means to

understand the role of motivation and innovation in entrepreneurship. From

the information gathered through survey it is observed that motivated

entrepreneurs are characterized by a desire for intrinsic results; a need for

constant inquiry into the unknown; a need for integrating future growth

synergistically with the internal strengths and with the exigencies of the

external environment; and a vision.

One of the benefits of this research would be that it provides the first

220
documented evidence of innovative entrepreneurs in Indian Aviation

Maintenance and Aircraft Charter business. The results found show that the

experience in India may be different than in the West. The focus on self-

financing and the willingness to move to new regions of the country to find a

partner are typical in India, but not in the West.

Independent MRO

This study found that social networks were not positively related to

opportunity identification. With respect to particularity of aviation MRO

business, innovative idea-based entrepreneurs form the sample of this study

who engage in developing and / or deploying their ideas to establish the

business.

The business ideas are not readily articulated or available from their social

encounters and hence the entrepreneurs have to confine themselves to the

conditions of their business scenario.

This study shows that Aviation maintenance business, although profitable

needs to be organized in cluster, i.e comprehensive repair capabilities will

have to be developed for survival.

Entrepreneurs in the Aviation maintenance business will have to invest in

increasing their capabilities to repair the related components. Further more

they will have to develop capabilities to manufacture PMA (parts

manufacturers approval) parts to feed their internal requirements.

221
Studies show that the next biggest boom in the global Aviation industry will

be triggered from India and the current trends are already proving this.

Entrepreneurs in the aviation maintenance sector will have to prepare

themselves for this exponential growth during 2010 2020. This will require

special efforts to associate with the OEMs (original equipment

manufacturers) who can authorize these entrepreneurs to handle the after

sales support of their products here in India.

Air Charter

Many entrepreneurs entered the Air charter business due to the glamour

attached with aviation industry, only to realize later that Air Charter is not a

profitable business. This study found that non of the Air Charter companies in

India have ever made profit and continue to operate as a support to their

parent companies which have used them for internal travel purpose.

Air charter business in India can either survive as a supporting activity to the

parent company or its business model has to be designed in a way to make

private air travel affordable, only then volumes can come from this business.

Entrepreneurs in Air Charter business will have to shift their focus on near by

overseas destinations like Singapore, Dubai and Hong Kong to offer

economical Air charter. There is enough passenger load for such

destinations, however the small jets owned by these Air charter companies

presently operating in India does not allow them to cover mid haul flights over

222
3 hours of flying and they will have to consider buying bigger aircrafts.

Promotion of a business is surrounded with uncertainties and the

entrepreneur has to perform in an unsure environment. The entrepreneur has

to confront many such uncertainties such as; will the proposed product /

service be accepted in the market ? Does the product / service have demand

and how long the demand will last ? Will the entrepreneur be able to yield

reasonable profits ? Will there be an assured supply of spares and

consumables as per requirement ? What kind of skilled and unskilled

manpower will be required ? Will labour with these skills be available or not ?

Government regulation and control in the concerned sector ? Will there be

any difficulty in fulfilling with the legal formalities ? What will be the source of

initial capital etc ?

Before making his/her efforts to start the business, the entrepreneur has to

seek pros and cons to the factors mentioned above and take important

decisions in that light.

Scope of Future Research

This study gives an understanding about the evolution and challenges faced

by entrepreneurs in both the sectors of aviation i.e Independent MRO and Air

Charter. However there is a further scope of detail analysis of the external

factors effecting the entrepreneurial growth in these two sectors. While the

aviation industry is growing by leaps and bounces and India is the 2nd fastest

growing market for aviation industry in the world, proportionate growth is not

223
seen in MRO sector, this leaves a scope for further research to find out the

actual reasons affecting the growth of this sector in India. The current

research has tried to study this sector from entrepreneurial angle, however

there are several challenges at the industry level which need to be further

researched.

Air Charter and Independent aviation MRO are labor and technology driven

industries and there is a need to study these sectors from the perspective of

technology and manpower. Some information is gathered about the impact of

high cost of labor and operation, however there is a need for an elaborate

study in these two areas.

Government policies have an impact on growth of any industry in India as

well as other countries, aviation not left aside. There is a need to study the

impact of government policies on these two sectors, which is holding back

the growth of revenue generations streams like MRO and Air charter, while

the aircraft manufacturers are taking away forex from India without any

commitment to the development of these sectors here.

224
APPENDIX I

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225
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234
 APPENDIX II

RESEARCH QUESTIONNAIRE

235
STUCTURED INTERVIEW SCHEDULE-1

OPEN-ENDED (FACE-TO-FACE)

Respondent :

Q-1 Personal Details

Res

Age : Designation : Category :

Q-2 Family background

Res

Service : Business : Farming :

Q-3 Name and address of the enterprise

Res

Location : Type of Company :

Q-4 Brief profile of business

Res

236
 Category : No. of Employees :

Q-5 What motivated you to venture into business over a salaried job ?

Res

Aviation as a hobby : Own interest in Aviation :

Q-6 Please list the motivating factors which drove you to take to
entrepreneurship.

Res

Instinct to take risk : Desire to take challenges :

Passion towards Aircraft : Strong desire to be your own master

:

Will to follow your dream : Desire to make it big in life:

Glamour : Money :

Q-7 Was money a motivating factor for you to become an entrepreneur ?

237
Res

Yes : No :

Q-8 When did you start nursing dreams of doing something on your own
and taking control of your destiny ?

Res

Q-9 When did your enterprise take shape of a company ? Please narrate
the financial conditions.
Res

Type of Company : Current capital :

Current financial condition : Current ROI

Break even :

Q- Please narrate the evolutionary phases of your entrepreneurship

10 and the mistakes made by you.

238
Res

Job to Ent. / Direct Ent : Capital :

Unavailability of Data : Control of OEMs:

Capital :

Q- How important do you think is the support of Parents / Spouse in the

11 seed stage of a businessman ?

Res

Source of funding : Financial and mental support :

Q- Do you think an innovative idea is the most important thing required

12 for the success of business ?

Res

Industry Need based : Opportunity based :

Innovative idea based : Foresight / Vision based :

Q- How confident were you about the success of your idea ?

239
13

Res

Desire to take challenges : Will to follow your dreams :

Q- What do you think is the relationship between education and attitude

14 towards undertaking risk in enterpreneurship ?

Res

Q- What are the entry barriers you faced while setting up the MRO / Air
15 Charter business ?

Res

Regulatory : Infrastructural constraints :

Capital : Control of OEMs :

Unavailability of data :

Q- How are you able to preserve the vision through the life cycle of your
16 business ?

240
Res

Q- Preserving your vision through the business cycle, how do you

17 balance growth, risk and profitability ?

Res

Effect of market fluctuations : Cash flow :

Q- What are the factors effecting the sustenance of an entrepreneur in

18 MRO / Air Charter business ?

Res

Regulatory conrtoles : High cost of operation :

Problems sourcing spares : Retaining Skilled man power:

Support from OEMs.

Q- Did you do any formal market survey to estimate the market size for
19 your Service ?

241
Res.

Industry data : Survey :

Q- How did you mobilize initial capital. Did you approach any of the
20 specialized financial institutions like SIDBI / how was the response?

Res

Source of funding :

Q- How did you deal with the cash flow constraints during the growth of
21 your enterprise ?

Res

Managing cash flow :

Q- How did you obtain the legitimacy necessary to enable you to

22 borrow from the banks / financial institutions ?

Res

242
 ROI : Current financial condition of company :

Q- Do you think the evolution of entrepreneurs in MRO / Air Charter

23 business was need based ?

Res

Need based : Opportunity based :

Q- Have you changed your product / service over time?

24

Res

Business life cycle :

Q- Did you have any mental, psychological blocks, how did you
25 overcome them.

Res

Q- Your enterprise has grown from scratch to the present stage. How
26 do you think a visionary entrepreneur transfers the skills and
inspirations to lead his enterprise to a successful level ?

243
Res

Foresight / Vision based :

Q- What are the rewards of owning own business?

27

Res

Monetary / Financial : Recognition :

Satisfaction of being Employer : Job satisfaction :

Q- What economic conditions affect your business?

28

Res

Effect of market fluctuation : Problem managing cash flow

:

Q- What is the greatest fear you have about your business ?

29

Res

244
 Q- What do you believe are the three most important reasons why your
30 business is so unique?

Res

Place :

Interviewed on :

Validated on :

The above questionnaire was filled up by the researcher after an informal

interview of the entrepreneurs and response were quantified on the basis of

significance of the reply of the questions by the entrepreneur. Interviews

were more of exploratory nature, rather than direct questions asked to the

entrepreneurs and interpretations were made after measuring the scores.

The general facts and financial facts were measures on High, Moderate and

Low scales, while the five factors motivations, entry barriers, evolutionary

factors, challenges faced in sustenance and rewards were measures on 0

and 1 scale where 0 = No and 1 = Yes.

245
APPENDIX III

SURVEY DATA

246
 Parameters

Sr. no. Name of Entrepreneur / Company Location Category

sno name Location Category
1 Ravi Menon / Airworks 1 1
2 Nanda Kumar / Indamer 1 1
3 Bharat Malkani / Max Aerospace 1 1
4 Victor Sena / Interiors Aeroservices 1 1
5 Joseph Doss / Bharat Aviation 1 1
6 Manek Daver / Livewel Aviation 1 1
7 Rajendra Johri / Aman Aviation 1 1
8 Manav singh / A.R.Aerotech 2 1
9 Rahul Bhatia / Interglobe 2 1
10 Dev Mohan Gupta / Horizon Aircraft Maintenance 2 1
11 Vishal Varshney / Magnum Aviation 2 1
12 Trilochan Singh / Vikram Aviation 2 1
13 Satyajit Singh Majithia / Saraya Aviation 2 1
14 Chanchal Ghosh / Associated Air Support 2 1
15 Nandy Bhatia / HBE group 2 1
16 M.M.Varman / Varman Aviation 3 1
17 B.R.Taneja / Taneja Aerospace 3 1
18 Captain Gopinath / Deccan Aviation 3 1
19 Ravi Rishi / Global Vectra 1 2
20 Gautam Singhania / Raymond Aviation 1 2
21 Kishor Bafna / Kestrel Aviation 1 2
22 Tanveer Romani / Golden Wings 1 2
23 V.K.Malhotra / Malhotra Helicopters 1 2
24 Avinash Bhosale / Arki Aviation 1 2
25 Rishi Agarwal / ABG aviation 1 2
26 Gautam Adani / Adani group 1 2
27 Samir Gahlot / Airmid aviation 1 2
28 Captain Gopinath / Deccan Aviation 3 2
29 Rakesh Baderwal / S.K.B.Infracons 2 2
30 Asia Aviation / Capt Kukkar 2 2
31 Sanjay Bhatia / SRC Aviation 2 2
32 Kanwar Deep Singh / Alchemist Aviation 2 2
33 Aiok Sharma / Air One 2 2
34 H.S.Waraich / Prem Air 2 2
35 R.K.Saraf / India Flysafe 2 2
36 Simon Jolly / Air Charter Services 2 2
37 Manav singh / Clubone Air 2 2

1-Mumba + Pune
1-Independent MRO
2-Delhi 2-Air Charter
3-Bangalore

Facts

1
247
 General

Age at which
you became Family Personal No. of Type of
entrepreneur Background Background Employees Company
ageofentry fam_occup per_back nemp typ_comp
1 2 2 3 2
2 1 1 2 2
2 2 2 2 2
3 1 1 1 2
2 1 1 1 2
2 2 1 3 2
2 2 1 1 2
1 1 2 2 2
1 2 2 2 2
1 2 2 2 2
1 2 2 2 2
3 1 1 1 2
3 1 1 2 2
2 1 1 2 2
2 1 1 2 2
3 1 1 2 2
1 1 1 3 3
3 3 1 2 2
2 1 1 2 3
1 2 2 2 3
1 2 2 1 2
2 1 1 1 2
2 1 1 1 2
2 1 1 2 2
1 2 2 1 3
1 2 2 2 3
2 2 2 2 2
3 3 1 2 2
2 2 1 2 2
2 1 1 1 2
1 2 1 1 2
2 1 1 2 2
3 1 1 1 2
3 1 1 1 2
1 2 2 2 2
2 2 2 2 2
1 2 2 3 2

1- < 30 yrs 1-Service 1-Job to Ent 1- <20 1-Prop / Part

2- 30-50 yrs 2-Business 2-Direct Ent. 2- 20-100 2-Pvt. Ltd.
3- > 50 yrs 3-Farming 3- >100 3-Public Ltd

Facts Facts Facts Facts Facts

248 2
 Financial

Current
Current Source of Break even financial
Initial Capital Capital funding period condition
ini_cap curr_cap source_fund breakeve curr_fin_cond
1 3 2 2 1
1 3 1 2 2
3 2 2 2 3
2 1 1 3 3
1 2 1 1 2
1 3 1 1 1
1 2 2 2 2
3 3 1 2 2
3 3 2 3 2
2 3 2 2 1
2 2 2 3 2
1 2 1 2 2
2 2 1 2 2
1 2 1 2 3
1 3 1 3 2
2 3 1 2 2
2 3 1 3 2
1 3 1 2 2
3 3 3 3 3
3 3 3 3 3
3 3 2 3 3
3 3 1 2 1
1 3 1 3 2
3 3 1 2 1
3 3 1 2 1
3 3 3 2 1
3 3 3 3 2
1 3 1 2 2
3 3 2 3 3
3 3 1 3 2
3 3 2 3 3
3 3 2 3 1
3 3 1 3 3
3 3 1 3 3
3 3 1 3 2
3 3 2 2 1
3 3 1 3 3

1- < 50 lacs 1- < 5 crore 1-Self / Partner1-/ VC

< 1 yr 1-Good Profit
2- < 5 crore 2- 5 - 50 crore 2-Family 2- 1-3 yrs 2-Average Profit
3- > 10 crore 3- > 50 crore 3-Bank / Stock 3-
market
> 3yrs 3-Loss

Facts Facts Facts Facts Facts

249 3
nancial Motivational facto
Aviation as a
hobby of any Your own Desire to take
family Interest in Instinct to challenges in
Current ROI member Aviation take risk life
roi moti1 moti2 moti3 moti4
3 1 1 1 1
2 0 1 0 1
3 0 1 1 1
3 0 1 0 1
1 0 1 0 0
1 0 1 1 1
1 0 1 0 1
2 1 1 1 1
2 0 1 1 1
2 1 1 1 0
3 0 1 1 1
3 0 1 1 1
3 0 1 1 1
3 0 1 0 1
2 0 1 1 1
2 0 1 0 1
3 0 1 1 1
1 0 1 1 1
2 1 1 1 1
3 1 1 1 1
3 0 1 1 0
2 0 1 1 1
3 1 1 1 0
1 0 0 1 1
1 0 0 1 1
1 0 0 1 1
2 0 1 1 1
1 0 1 1 1
3 0 0 1 1
2 1 1 0 1
3 0 1 1 0
1 0 0 1 1
2 0 1 1 1
3 1 1 1 1
2 0 0 1 1
2 0 1 1 1
2 1 1 1 1

1-Satisftry 1-Yes 1-Yes 1-Yes 1-Yes

2-Average 0-No 0-No 0-No 0-No
3-Unsatisftry

Facts Internal Internal Internal Internal

250 4
 Motivational factors
Passion Ambitious /
towards Strong desire Desire to
Aircrafts / to be your Will to follow make it big in
Flying own master your dream life Money
moti5 moti6 moti7 moti8 moti9
1 1 1 1 0
1 1 0 1 1
0 1 1 1 1
1 1 0 0 1
0 1 0 1 1
1 1 1 1 0
1 1 1 1 0
1 1 1 1 0
1 1 1 1 1
1 1 0 1 1
0 1 0 1 1
1 0 1 0 0
1 0 1 1 0
0 1 0 0 1
0 1 0 0 1
1 0 1 0 0
1 1 1 1 1
1 0 1 1 0
0 1 1 1 1
1 1 1 1 0
0 1 0 1 1
0 1 1 1 1
1 1 1 0 0
0 1 1 1 1
0 1 1 1 1
1 1 1 1 1
0 1 1 1 1
1 1 1 1 0
0 1 0 1 1
1 1 0 0 1
0 1 1 0 0
0 1 1 1 1
1 1 1 0 1
1 1 0 0 1
1 1 1 0 1
1 1 1 1 1
1 1 1 1 0

1-Yes 1-Yes 1-Yes 1-Yes 1-Yes

0-No 0-No 0-No 0-No 0-No

Internal Internal Internal Internal External

251 5
 Entry Barriers
Difficulty in
getting
Permissions / Infrastructural
Glamour Motivation Approvals constraints Capital
moti10 Max 10 barr1 barr2 barr3
0 8 0 0 0
0 6 1 1 1
1 8 0 1 0
0 5 1 1 1
0 4 1 1 1
0 7 0 0 0
0 6 1 1 1
1 9 0 0 0
0 8 0 0 0
0 7 0 0 0
0 6 1 0 0
0 5 1 1 1
0 6 1 0 1
0 4 1 1 1
0 5 1 1 0
0 4 1 0 1
0 8 1 0 0
0 6 1 0 1
1 9 0 0 0
1 9 0 0 0
0 5 1 1 0
1 8 1 1 0
0 6 1 1 1
1 7 0 0 0
0 6 1 0 0
0 7 0 0 0
0 7 1 0 0
0 7 1 0 0
0 5 1 0 0
0 6 1 1 1
0 4 1 1 1
1 7 0 0 0
1 8 1 0 1
0 7 1 0 0
0 6 1 1 1
0 8 0 0 0
1 9 0 1 0

1-Yes 1-Yes 1-Yes 1-Yes

0-No 0-No 0-No 0-No

External Government Government Industry

252 6
Entry Barriers Evolutionary factors

Control of Unavailibility Industry Need Opportunity

OEMs of data Barriers based based
barr4 barr5 Max 5 evolu1 evolu2
0 1 1 1 1
1 0 4 0 1
0 0 1 1 0
0 1 4 1 0
0 1 4 1 0
1 1 2 0 1
0 0 3 0 1
0 0 0 0 1
1 0 1 0 1
0 1 1 0 1
1 1 3 0 1
1 0 4 0 0
0 1 3 0 1
1 1 5 1 1
1 0 3 0 1
1 1 4 0 0
0 1 2 0 1
0 0 2 1 1
0 1 1 1 1
0 0 0 0 1
0 1 3 0 1
0 0 2 1 1
0 1 4 1 1
0 1 1 0 1
1 1 3 0 1
1 1 2 0 1
1 1 3 1 1
0 0 1 1 1
1 1 3 0 1
0 1 4 1 1
1 1 5 0 1
0 1 1 1 1
0 0 2 0 1
1 0 2 0 1
0 0 3 1 1
1 0 1 1 1
0 0 1 0 1

1-Yes 1-Yes 1- Yes 1- Yes

0-No 0-No 0-No 0-No

Industry Industry External Internal

253 7
Evolutionary factors Challenges faced

High cost of
Innovative Foresight / Regulatory operation /
Idea based Vision based Evolution controles Fixed cost
evolu3 evolu4 Max 4 chall1 chall2
0 1 3 0 0
1 0 2 1 1
0 1 2 0 0
0 0 1 1 0
1 1 3 1 1
1 1 3 0 0
0 1 2 1 0
1 1 3 0 0
1 1 3 0 0
0 1 2 1 0
1 1 3 1 1
1 0 1 1 1
0 1 2 0 1
0 0 2 1 1
0 0 1 1 1
1 0 1 1 0
1 1 3 0 0
1 1 4 0 0
1 1 4 0 0
1 0 2 0 1
0 0 1 1 1
0 1 3 1 0
0 0 2 1 1
1 0 2 0 0
0 0 1 1 1
1 1 3 0 1
0 1 3 0 1
1 1 4 0 0
0 0 1 1 1
0 0 2 1 1
0 0 1 1 1
0 1 3 0 1
1 1 3 0 1
0 0 1 1 0
0 0 2 1 1
0 1 3 0 0
1 1 3 0 0

1- Yes 1- Yes 1-Yes 1-Yes

0-No 0-No 0-No 0-No

Internal External Government Industry

254 8
 Challenges faced in Sustenance
Difficulty Difficulty
Problem retaining getting Affected by Problem
sourcing Skilled Man support from Market Managing
Spares power OEM fluctuations Cash flow
chall3 chall4 chall5 chall6 chall7
0 0 0 1 0
0 1 0 0 0
0 1 0 1 1
0 1 0 0 1
1 0 1 1 1
1 1 0 0 0
1 1 1 0 0
0 1 0 1 0
0 1 0 1 0
0 1 0 0 0
0 1 0 1 1
1 0 1 1 0
1 1 1 0 0
0 1 0 1 1
0 1 0 0 1
1 0 1 0 0
0 0 0 0 0
0 0 0 0 0
0 1 0 1 0
1 0 0 0 0
1 1 1 0 0
1 0 1 0 0
0 1 1 0 0
1 0 0 0 0
1 0 1 0 0
0 0 0 0 0
0 0 1 0 0
0 0 0 0 0
1 1 1 1 1
1 1 1 1 1
1 1 1 1 1
1 0 1 1 1
1 1 1 1 1
1 0 1 1 1
1 0 0 1 1
0 1 1 1 0
0 1 0 1 1

1-Yes 1-Yes 1-Yes 1-Yes 1-Yes

0-No 0-No 0-No 0-No 0-No

Industry Industry Industry Other Industry Industry

255 9
 Rewards to the Entrepreneur

Recongnition Satisfaction of
Monetary / in the being an Job
Challenges Financial Industry employer satisfaction
Max 7 rewards1 rewards2 rewards3 rewards4
1 1 1 1 1
3 1 0 1 0
3 1 1 0 0
3 1 0 0 0
6 0 0 1 1
2 1 1 1 1
4 0 0 1 1
2 0 1 1 1
2 1 1 1 1
2 1 1 0 1
5 0 0 0 1
5 0 1 1 1
4 1 0 0 1
5 0 1 0 1
4 1 0 1 1
3 1 0 1 1
0 1 1 1 1
0 1 1 1 1
2 1 1 1 1
2 0 1 1 1
5 0 0 0 1
3 1 1 0 1
4 0 0 1 1
1 1 1 0 1
4 0 0 0 1
1 1 1 1 1
2 1 1 0 0
0 1 1 1 1
7 0 0 0 1
7 0 0 1 1
7 0 0 1 1
5 1 1 1 1
6 0 1 1 1
5 0 0 0 1
5 0 0 1 1
3 1 1 0 1
3 1 1 1 1

1-Yes 1-Yes 1-Yes 1-Yes

0-No 0-No 0-No 0-No

External Internal Internal Internal

256 10
Rewards
Max 4
4
2
2
1
2
4
2
3
4
3
1
3
2
2
3
3
4
4
4
3
1
3
2
3
1
4
2
4
1
2
2
4
3
1
2
3
4

257
APPENDIX IV

SPSS OUT PUTS

258
 Location

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-Mumba +
16 43.2 43.2 43.2
Pune
2-Delhi 17 45.9 45.9 89.2
3-Bangalore 4 10.8 10.8 100.0
Total 37 100.0 100.0

Category

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-
Independent 18 48.6 48.6 48.6
MRO
2-Air
19 51.4 51.4 100.0
Charter
Total 37 100.0 100.0

Age at which you became entrepreneur

Valid Cumulative
Frequency Percent Percent Percent
Valid 1- < 30 yrs 13 35.1 35.1 35.1
2- 30-50
16 43.2 43.2 78.4
yrs
3- > 50 yrs 8 21.6 21.6 100.0
Total 37 100.0 100.0

Family Background

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-Service 18 48.6 48.6 48.6
2-Business 17 45.9 45.9 94.6
3-Farming 2 5.4 5.4 100.0
Total 37 100.0 100.0

Family Background

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-Service 18 48.6 48.6 48.6

259
 2-
Business/Fa 19 51.4 51.4 100.0
rming
Total 37 100.0 100.0

Personal Background

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-Job to Ent 23 62.2 62.2 62.2
2-Direct
14 37.8 37.8 100.0
Ent.
Total 37 100.0 100.0

No. of Employees

Valid Cumulative
Frequency Percent Percent Percent
Valid 1- <20 12 32.4 32.4 32.4
2- 20-100 21 56.8 56.8 89.2
3- >100 4 10.8 10.8 100.0
Total 37 100.0 100.0

Type of Company

Valid Cumulative
Frequency Percent Percent Percent
Valid 2-Pvt. Ltd. 32 86.5 86.5 86.5
3-Public Ltd 5 13.5 13.5 100.0
Total 37 100.0 100.0

Initial Capital

Valid Cumulative
Frequency Percent Percent Percent
Valid 1- < 50 lacs 11 29.7 29.7 29.7
2- < 1 crore 6 16.2 16.2 45.9
3- > 1 crore 20 54.1 54.1 100.0
Total 37 100.0 100.0

Current Capital

Valid Cumulative
Frequency Percent Percent Percent

260
Valid 1- < 5 crore 1 2.7 2.7 2.7
2- < 10
7 18.9 18.9 21.6
crore
3- > 10
29 78.4 78.4 100.0
crore
Total 37 100.0 100.0

Source of funding

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-
Self/Partner/ 22 59.5 59.5 59.5
VC
2-Family 11 29.7 29.7 89.2
3-Bank /
Stock 4 10.8 10.8 100.0
market
Total 37 100.0 100.0

Break even period

Valid Cumulativ
Frequency Percent Percent e Percent
Valid 1- < 1 yr 2 5.4 5.4 5.4
2- 1-3 yrs 17 45.9 45.9 51.4
3- > 3yrs 18 48.6 48.6 100.0
Total 37 100.0 100.0

Current financial condition

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-Good
9 24.3 24.3 24.3
Profit
2-Average
17 45.9 45.9 70.3
Profit
3-Loss 11 29.7 29.7 100.0
Total 37 100.0 100.0

Current ROI

Valid Cumulative
Frequency Percent Percent Percent
Valid 1-Satisftry 9 24.3 24.3 24.3

261
 2-Average 14 37.8 37.8 62.2
3-
14 37.8 37.8 100.0
Unsatisftry
Total 37 100.0 100.0

Aviation as a hobby of any family member

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 28 75.7 75.7 75.7
1-Yes 9 24.3 24.3 100.0
Total 37 100.0 100.0

Your own Interest in Aviation

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 6 16.2 16.2 16.2
1-Yes 31 83.8 83.8 100.0
Total 37 100.0 100.0

Adventurous / Craving to take risk

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 7 18.9 18.9 18.9
1-Yes 30 81.1 81.1 100.0
Total 37 100.0 100.0

Desire to take challenges in life

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 5 13.5 13.5 13.5
1-Yes 32 86.5 86.5 100.0
Total 37 100.0 100.0

Passion towards Aircrafts / Flying

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 14 37.8 37.8 37.8
1-Yes 23 62.2 62.2 100.0
Total 37 100.0 100.0

262
 Being your own master

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 4 10.8 10.8 10.8
1-Yes 33 89.2 89.2 100.0
Total 37 100.0 100.0

Follow your dream

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 11 29.7 29.7 29.7
1-Yes 26 70.3 70.3 100.0
Total 37 100.0 100.0

Ambitious / Desire to make it big in life

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 11 29.7 29.7 29.7
1-Yes 26 70.3 70.3 100.0
Total 37 100.0 100.0

Money

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 13 35.1 35.1 35.1
1-Yes 24 64.9 64.9 100.0
Total 37 100.0 100.0

Glamour

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 28 75.7 75.7 75.7
1-Yes 9 24.3 24.3 100.0
Total 37 100.0 100.0

Number of Motivational Factors

Valid Cumulative
Frequency Percent Percent Percent

263
Valid 4 4 10.8 10.8 10.8
5 5 13.5 13.5 24.3
6 9 24.3 24.3 48.6
7 8 21.6 21.6 70.3
8 7 18.9 18.9 89.2
9 4 10.8 10.8 100.0
Total 37 100.0 100.0

Difficulty in getting Permissions / Approvals

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 13 35.1 35.1 35.1
1-Yes 24 64.9 64.9 100.0
Total 37 100.0 100.0

Infrastructural constraints

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 22 59.5 59.5 59.5
1-Yes 15 40.5 40.5 100.0
Total 37 100.0 100.0

Capital Intensive

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 23 62.2 62.2 62.2
1-Yes 14 37.8 37.8 100.0
Total 37 100.0 100.0

Control of OEMs

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 22 59.5 59.5 59.5
1-Yes 15 40.5 40.5 100.0
Total 37 100.0 100.0

Unavailibility of data

Valid Cumulative
Frequency Percent Percent Percent

264
Valid 0-No 16 43.2 43.2 43.2
1-Yes 21 56.8 56.8 100.0
Total 37 100.0 100.0

Number of Barriers

Valid Cumulative
Frequency Percent Percent Percent
Valid 0 2 5.4 5.4 5.4
1 10 27.0 27.0 32.4
2 7 18.9 18.9 51.4
3 9 24.3 24.3 75.7
4 7 18.9 18.9 94.6
5 2 5.4 5.4 100.0
Total 37 100.0 100.0

Industry Need based

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 22 59.5 59.5 59.5
1-Yes 15 40.5 40.5 100.0
Total 37 100.0 100.0

Opportunity based

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 5 13.5 13.5 13.5
1-Yes 32 86.5 86.5 100.0
Total 37 100.0 100.0

Idea based

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 20 54.1 54.1 54.1
1-Yes 17 45.9 45.9 100.0
Total 37 100.0 100.0

Encouragement by family / Industry friends

Valid Cumulative
Frequency Percent Percent Percent

265
Valid 0-No 16 43.2 43.2 43.2
1-Yes 21 56.8 56.8 100.0
Total 37 100.0 100.0

Number of Evolution Factors

Valid Cumulative
Frequency Percent Percent Percent
Valid 1 9 24.3 24.3 24.3
2 11 29.7 29.7 54.1
3 14 37.8 37.8 91.9
4 3 8.1 8.1 100.0
Total 37 100.0 100.0

Regulatory controls

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 18 48.6 48.6 48.6
1-Yes 19 51.4 51.4 100.0
Total 37 100.0 100.0

High cost of operation / Fixed cost

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 18 48.6 48.6 48.6
1-Yes 19 51.4 51.4 100.0
Total 37 100.0 100.0

Spares

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 19 51.4 51.4 51.4
1-Yes 18 48.6 48.6 100.0
Total 37 100.0 100.0

Skilled Man power

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 16 43.2 43.2 43.2
1-Yes 21 56.8 56.8 100.0

266
 Total 37 100.0 100.0

Control by OEMs

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 20 54.1 54.1 54.1
1-Yes 17 45.9 45.9 100.0
Total 37 100.0 100.0

Market fluctuations

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 19 51.4 51.4 51.4
1-Yes 18 48.6 48.6 100.0
Total 37 100.0 100.0

Cash flow

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 23 62.2 62.2 62.2
1-Yes 14 37.8 37.8 100.0
Total 37 100.0 100.0

Number of Challenges

Valid Cumulative
Frequency Percent Percent Percent
Valid 0 3 8.1 8.1 8.1
1 3 8.1 8.1 16.2
2 7 18.9 18.9 35.1
3 7 18.9 18.9 54.1
4 5 13.5 13.5 67.6
5 7 18.9 18.9 86.5
6 2 5.4 5.4 91.9
7 3 8.1 8.1 100.0
Total 37 100.0 100.0

Monetary / Financial

Valid Cumulative
Frequency Percent Percent Percent

267
Valid 0-No 16 43.2 43.2 43.2
1-Yes 21 56.8 56.8 100.0
Total 37 100.0 100.0

Recongnition in the Industry

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 16 43.2 43.2 43.2
1-Yes 21 56.8 56.8 100.0
Total 37 100.0 100.0

Satisfaction of being an employer

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 14 37.8 37.8 37.8
1-Yes 23 62.2 62.2 100.0
Total 37 100.0 100.0

Job satisfaction

Valid Cumulative
Frequency Percent Percent Percent
Valid 0-No 4 10.8 10.8 10.8
1-Yes 33 89.2 89.2 100.0
Total 37 100.0 100.0

Number of Rewards

Valid Cumulative
Frequency Percent Percent Percent
Valid 1 6 16.2 16.2 16.2
2 11 29.7 29.7 45.9
3 10 27.0 27.0 73.0
4 10 27.0 27.0 100.0
Total 37 100.0 100.0

268
Difficulty in getting Permissions / Approvals * Motivation category

Crosstab

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Difficulty in 0-No Count

getting
0 0 13 13
Permissions
/ Approvals

% within
Motivation .0% .0% 68.4% 35.1%
category

1-Yes Count 4 14 6 24

% within
Motivation 100.0% 100.0% 31.6% 64.9%
category

Total Count 4 14 19 37

% within
100.0 100.0
Motivation 100.0% 100.0%
% %
category

Chi-Square Tests

Asymp.
Sig. (2-
Value df sided)

Pearson Chi- 18.987(

2 .000
Square a)

N of Valid Cases 37

a 3 cells (50.0%) have expected count less than 5. The minimum expected
count is 1.41.

269
 Symmetric Measures

Approx.
Value Sig.

Nominal by Contingency
.582 .000
Nominal Coefficient

N of Valid Cases 37

a Not assuming the null hypothesis.

b Using the asymptotic standard error assuming the null hypothesis.

Infrastructural constraints * Motivation category

Crosstab

Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Infrastructu 0-No Count

ral 1 5 16 22
constraints

% within
Motivatio
25.0% 35.7% 84.2% 59.5%
n
category

1-Yes Count 3 9 3 15

% within
Motivatio
75.0% 64.3% 15.8% 40.5%
n
category

Total Count 4 14 19 37

% within
Motivatio 100.0
100.0% 100.0% 100.0%
n %
category

270
 Motivation category Total

Moderat High
Low (<4) e (4-6) (>6)

Capital 0-No Count

Intensiv 0 5 18 23
e

% within
Motivatio
.0% 35.7% 94.7% 62.2%
n
category

Chi-Square Tests

Asymp.
Sig. (2-
Value df sided)

Pearson Chi- 10.074(

2 .006
Square a)

N of Valid Cases 37

a 2 cells (33.3%) have expected count less than 5. The minimum

expected count is 1.62.

Symmetric Measures

Approx.
Value Sig.

Nominal by Contingency
.463 .006
Nominal Coefficient

N of Valid Cases 37

a Not assuming the null hypothesis.

b Using the asymptotic standard error assuming the null hypothesis.

Capital Intensive * Motivation category

Crosstab

1-Yes Count
% within 4 9 1 14
Motivatio
% 100.0% 64.3% 5.3% 37.8%
n within
Motivatio
category 100.0% 64.3% 5.3% 37.8%
n
category

271
Total Count 4 14 19 37

% within
Motivatio 100.0
100.0% 100.0% 100.0%
n %
category

Chi-Square Tests

Asymp.
Sig. (2-
Value df sided)

Pearson Chi- 19.307(

2 .000
Square a)

N of Valid Cases 37

a 2 cells (33.3%) have expected count less than 5. The minimum

expected count is 1.51.

Symmetric Measures

Approx.
Value Sig.

Nominal by Contingency
.586 .000
Nominal Coefficient

N of Valid Cases 37

a Not assuming the null hypothesis.

b Using the asymptotic standard error assuming the null hypothesis.

Control of OEMs * Motivation category

Crosstab

Motivation category Total

Low High
(<4) Moder (>6)
ate (4-

272
 6)

Control of 0-No Count

1 8 13 22
OEMs

% within
Motivatio
25.0% 57.1% 68.4% 59.5%
n
category

1-Yes Count 3 6 6 15

% within
Motivatio
75.0% 42.9% 31.6% 40.5%
n
category

Total Count 4 14 19 37

% within
Motivatio 100.0 100.0
100.0% 100.0%
n % %
category

Chi-Square Tests

Asymp.
Sig. (2-
Value Df sided)

Pearson Chi-
2.635(a) 2 .268
Square

N of Valid Cases 37

a 2 cells (33.3%) have expected count less than 5. The minimum expected
count is 1.62.

Symmetric Measures

Approx.
Value Sig.

Nominal by Contingency
.258 .268
Nominal Coefficient

273
N of Valid Cases 37

a Not assuming the null hypothesis.

b Using the asymptotic standard error assuming the null hypothesis.

Unavailibility of data * Motivation category

Crosstab

Motivation category

Low Moderat High

(<4) e (4-6) (>6) Total

Unavailibili 0-No Count 0 6 10 16

ty of data
% within
Motivation .0% 42.9% 52.6% 43.2%
category

1-Yes Count 4 8 9 21

% within
Motivation 100.0% 57.1% 47.4% 56.8%
category

Total Count 4 14 19 37

% within
Motivation 100.0% 100.0% 100.0% 100.0%
category

Chi-Square Tests

Asymp.
Sig. (2-
Value df sided)

Pearson Chi-
3.731(a) 2 .155
Square

N of Valid Cases 37

a 2 cells (33.3%) have expected count less than 5. The minimum expected
count is 1.73.

274
 Symmetric Measures

Approx.
Value Sig.

Nominal by Contingency
.303 .155
Nominal Coefficient

N of Valid Cases 37

a Not assuming the null hypothesis.

b Using the asymptotic standard error assuming the null hypothesis.

Oneway ANOVA

Descriptives

ANOVA

Number of Barriers

Sum of Mean
Squares Df Square F Sig.

Between
50.957 2 25.478 54.269 .000
Groups

Within
15.962 34 .469
Groups

Total 66.919 36

275