Entrepreneurship

Definitions, role, application

Innovation and Creativity
Small business

How is wealth created ?

Investing surplus/savings
Harnessing nature
Getting means of production together
Innovations and creativity
Process/system changes
Technology spread

Jamshetji Tata
devoted himself setting up an iron and steel
company, a world class learning institution
and a hydro electric plant.
The company started by Jamsetji Tata came
to be known as the Tata Group
Jamsetji, was a pioneer in his field and
thought way ahead of his times.
he also put in place very good labour
practiceslong before any labour laws came
into existence.

Various definitions

French: go between :
mixes customer need and innovation
Person bearing risks of profit/loss
Separate profits of entrepreneur from that
of Capital
Peter Drucker: maximises opportunities
Create something different; adds time and
energy

Role of Entrepreneurship in
Economic Growth
critical in capitalist economy
An entrepreneur is not a Gambler
He takes moderate risk , after due assessment
Should have multiple Management skills as he will
have limited support initially.

Difference from Venture Capitalists: high risk+ high

interest on capital

Essentials for entrepreneurs

developing

Role models
Tax structure
Free markets
Risk capital availability
Social acceptance
Education and system support
Legal protection on Innovations

Personal traits

Seeks independence
Need for achievement
Believes in the idea
Willing to risk a failure
Graduate
Bangalore study: initial investment of Rs 5 L
Failure rate : 20 %
Multiple tries at success
30 years +

Typical traits of an entrepreneur

Risk
Probability of occurrence * likely cost of
damage
THREE TYPES OF UNCERTAINTY.
Risk, which is measurable statistically
Ambiguity: hard to measure
True Uncertainty: impossible to predict

RISKS

TECHNOLOGY
MARKET
FINANCIAL
PEOPLE
GOVERNMENT POLICIES

Creativity
Ability to bring something new into
existence
Lateral thinking
Multi-disciplinary approach

Some innovative ideas from

Internet( to be taken with pinch of
salt)

The creative process

Idea Germination
Preparation
Illumination
Validation: check

Creativity is normal

Knowledge society
Peter Druckers prediction
Blue collar/ white collar/knowledge worker
Human assets will predominate the worth
of a Company in future
Not more than 2 % of Microsofts worth is
held in factories!
Knowledge workers are paid for
INNOVATIONS and Creativity!!!

Innovation
Convert useful applications /ideas into new
process/product
A business instinct is essential for this
conversion.

Process of Innovation
An inventor does not necessarily become an
entrepreneur
Difference between an idea and Business
Opportunity?
Difference between Innovation and Invention
Who is the link?

 An Entrepreneur identifies the window of

opportunity
Develops the business

Plan:
Determine resources required:
Manage
Reap

New product ideas emerge from

Consumers
Walkman
Existing Companies
Distribution channels
Laboratories: Research
Government

Let us think of some new products

Common tricks
Lateral thinking

Pepsi Crow
Kahan ja rahe ho?

Intellectual property

Definitions
Protection
Patent Laws
Registration
Trademarks
Copyright

Extension of IP
Licensing
Franchising
Contracts
Serial Entrepreneurship
Compete or complement large business

WHATEVR THE MIND CAN CONCEIVE AND BELIEVE

.IT CAN ACHIEVE

Success is not in never failing

.. but in rising every time you fall.

BUSINESS PLAN

LIKE A JOURNEY
WHERE DO YOU WANT TO BE
LANDMARKS ?
HOW TO TRAVEL
STEER ROUND OBSTACLES
RESOURCE USAGE

MARKETING PLAN

Essential issues
4 Ps
Product
Price
Place
Promotion

Financial Plan
Cash flow is critical
Initial stages: receivables are low
Cash support needed form various
sources
Scrutiny by lenders
Collateral security
Venture Capital

Financial Appraisal
Necessary to know the basics of how
banks/lending institutions appraise a
proposal
Is the idea sound?
is the operation likely to be profitable in
future?
Are the promoters dependable/skilled to
deliver?

Entrepreneurship vs. Small

Business Ownership

Innovation is the key difference

Managerial issues remain the same
Element of risk is different.
Entrepreneurship is rarer.

Intrapreneurship
Corporate Venturing
Profit Centre concept
Critical to Technology companies
Research and Development effort

????... PLEASE