Auro University

Module: Creating Entrepreneurial Mindset

Submitted by Parth D Torawala
BBA 2019 Section-B
Submitted to school of business module leader Prashant Pareek
 Introduction to Entrepreneurship
Entrepreneurship is building a new business from scratch. It means
coming up with an idea that you think will be successful, then doing
the work to make that business idea a reality - including raising
money to get started, making of a brand, managing products and the
business.
Entrepreneurship is a mental game. The key to entrepreneurship is
finding a problem and solving it. As Peter Drucker, the father of
management points out "The entrepreneur always searches for
change, responds to it, and exploits it as an opportunity." An
entrepreneur is someone who has an idea and who works to create a
product or services that people will buy, by developing a system to
support those sales. In my opinion, being an entrepreneur is not like
a "job title", it's way more a way of life. It is something that follows
you around 24/7.
Entrepreneurship is running a marathon. Most people confuse it with
a 100-yard dash. This is the same reason why most people fail as an
entrepreneur. It's not about how fast you can go; it's about how long
you can stay in the race without quitting.
Entrepreneurship is just like weight-loss. Think about it this way, will
working out and eating well for one day make any difference to you?
Not at all. It's the exact same way with entrepreneurship. One day of
working hard on your business won't make any difference. It's all
about consistency, perseverance, and building a daily habit of it.
Entrepreneurship will drive you to the absolute ground if you don't
play your cards right. You need to put your mind in the right areas
not only for success but for longevity. If you focus your energy on the
wrong areas, you'll burn out and die a painful death. And that painful
death is going back to your 9-5.
 Why Phil “Buck” Knight opted shoe business?
Nike: the world’s most popular and biggest sportswear
company. In just over 50 years one man’s dream of better
shoes turned into a global corporation worth over $100
billion. The year is 1962 and Phil Knight had just graduated
from Stanford. As any business graduate can tell you,
becoming an entrepreneur is difficult if you don’t have any
good ideas, but Phil had one. He was a distance runner back in
university and in one of his business classes he had written a
paper proposing the following idea. (The paper’s title was:
“can Japanese sports shoes do to German sports shoes what
Japanese cameras did to German cameras?”) Phil had seen
how Japanese cameras had replaced the dominant German
cameras in the American market, and he wondered whether
Japanese shoes could do the same to Puma and Adidas, which
were at the time extremely popular in America. After writing
that paper and graduating, Phil became obsessed with his idea
about bringing Japanese shoes to the USA. Of course, he
didn’t actually own any Japanese running shoes and the few
he had seen were brought stateside by soldiers who had been
stationed in Japan during the Occupation after the Second
World War. In November 1962, he flew over to Japan like a
tourist and just started exploring. In the beautiful city of Kobe,
he stumbled upon a shoe store that caught his eye. It belonged
to a company called Onitsuka Tiger and the shoes they made
were of very high quality, so much so that Phil was
determined to import them back home. That is why Phil
Knight decided to start a shoe company, which later on in
1971 named as Nike.
Initial challenges faced by Phil Knight
Back in 1962, Phil arranged a meeting with the Onitsuka
Tiger company’s founder and grabbed the deal. In 1963, he
received his first shipment of twelve pairs of Tiger shoes and
he started selling them out of the back of his car at every
running track he could drive to. Obviously though, his
strategy wasn’t scalable, so he went to the only person he
knew who understood more about shoes than he did: his
former coach at the University of Oregon, Bill Bowerman.
They both partnered up and started a company named Blue
Ribbon Store. Their company was among the first to start
marketing the Tiger shoes for jogging. Bill was all about
innovation, and with every shipment he’d open a few shoes to
see how they were made and he’d try to improve them. It was
one of Bill’s design that catapulted BRS into the mainstream:
the Cortez, as he called it. Thanks to the Cortez, BRS sold
$300,00 worth of shoes in 1969. But they had a big problem:
the Cortez was so successful that they couldn’t keep up with
the demand. Every new shipment they received sold out faster
than the on before, but Onitsuka kept sending them at the
same glacial pace. What Onitsuka were actually doing was
satisfying their local demand in Japan first and then sending
whatever was left to America. Phil and Bill knew that to
expand they would have to evolve beyond being just a simple
distributor. So as soon as the contract with Onitsuka expired,
they were free to start making it for themselves.

SWOT Analysis of NIKE

Strength Opportunities
  No.1 shoemaker company in the The brand is fiercely defended by its
world. owners whom truly believe that Nike
 Nike Town shoe and sportswear is not a fashion brand however
stores, Nike factory outlets and consumers that wear Nike Products
Nike Women shops. do not always buy it to participate in
 Sales funnels over 100+ sport. In youth especially, Nike is a
countries. fashion brand.
 Strong research and
development cell. The business could also be developed
 High quality products and the internationally. With its strong brand
lowest possible prices. recognition, global marketing events
that can be utilized to support the
 Strong brand recognition.
brand such as the World Cup(soccer)
 Its ‘Swoosh’ is instantly
and Olympics.
recognizable.

Weakness Threat
The income of the business is still Nike is exposed to the international
heavily dependent upon its share of nature of trade. It buys sells in
the footwear market. This may leave different currencies and so costs
it vulnerable if for any reason its and margins are not stable over
market share goes down. long periods of time. Such an
exposure could mean that Nike may
The retailer sector is very price
be selling at a loss.
sensitive. However, most of its
income is derived from selling into
retailers. Retailers tend to offer a The market for shoes and garments
very similar experience to the is very competitive. Competitors
consumer. So, margins tend to get are developing alternative brands
squeezed as retailers try to pass some to take away Nike’s market share.
of the low-price competition pressure
onto Nike.

If diversified in other areas which are those areas?

Phil Knight primarily started Nike as a shoe distributor of
Onitsuka Tiger in the USA. From the late 1980s Nike steadily
expanded its business and diversified its product line through
numerous acquisitions, including the shoe companies Cole Haan
(1988; sold in 2012) and Converse, Inc. (2003), the sports-
equipment producer Canstar Sports, Inc. (1994; later called Bauer
and sold in 2008), and the athletic apparel and equipment
company Umbro (2008; sold in 2012). In 1996 the company
created Nike ACG (“all-conditions gear”), which markets
products for extreme sports such as snowboarding and mountain
biking. In the early 21st century Nike began selling sports-
technology accessories, including portable heart-rate monitors
and high-altitude wrist compasses. Apple and Nike partnered 10
years ago for a special edition iPod -- the Nike+ iPod -- to get you
running to the beat. The music player came bundled with a
wireless sensor that could be placed in select Nike sneaks and
used to measure pace and distance when running. Nike and Apple
also collaborated in the making of iWatch which has advanced
features to help runners. Nike has a dozen brands that serve more
than 30 major sports and consumer lifestyles. In addition to the
Nike and Jordan brands, their wholly-owned subsidiaries include
Cole Haan (luxury shoes, handbags, accessories and coats);
Converse (athletic and lifestyle footwear, apparel and
accessories); Hurley (action sports and youth lifestyle footwear,
apparel and accessories); Nike Golf, and Umbro (a leading U.K.
based football/soccer brand). Each strengthens their ability to
maximize their reach and relevance worldwide.
 Controversy associated with Nike under leadership of Phil.
American international corporation, Nike has become a theme of difference
ever since it unveiled it's new “Just Do It” advertising campaign that includes
former NFL player Colin Kaepernick. many Americans shared photos and
videos of them burning Nike product in protest. Critics of Kaepernick have hit
out at Nike on social media platforms. Clearly peeved with the sports complete,
many folks denote footage and videos of them burning the company’s product
on social media, using the hashtag #boycottNike and #justburnit.

https://www.vox.com/2018/9/4/17818148/nike-
boycott-kaepernick
Another incident when, Phil Knight, the company director, clearly stung by
reports of children as young as 10 making shoes, clothing, and footballs in
Pakistan and Cambodia, tried to convince Nike's critics that it had only ever
employed children accidentally. "Of all the issues facing Nike in workplace
standards, child labour is the most vexing," he said in the report. "Our age
standards are the highest in the world: 18 for footwear manufacturing, 16 for
apparel and equipment, or local standards whenever they are higher. But in
some countries, those standards are next to impossible to verify when records
of birth do not exist or can be easily forged." Nike’s sweatshop problem is
threatening a comeback. On July 29, students and activists around the world
participated in a day of protest against Nike, organized by United Students
Against Sweatshops (USAS). Among them claim that workers at a Nike
contract factory in Hansae, Vietnam, suffered wage theft and verbal abuse,
and laboured for hours in temperatures well over the legal limit of 90
degrees, to the point that they would collapse at their sewing machines.
 Future plans of Nike
Nike Inc. has revealed its first power-lacing sneaker — it allows
users to make the fit looser or more comfortable on the fly by
pressing buttons on the side of the shoe.
The world's biggest sportswear brand, based in Beaverton,
Oregon, revealed the sneaker along with a host of other
innovations at a media event in New York.
The innovations come as Nike is digging deeper into personalized
products and services while focusing on reaching a goal of
posting $50 billion in annual revenue by the end of its fiscal 2020
year. It reported $30.6 billion in revenue for its latest fiscal year
that ended in May.
Other innovations Nike highlighted include "anti-clog traction,"
which uses technology that prevents mud from sticking to the
soles of soccer studs.
Nike also revealed a new Nike Plus app, an all-access pass for
athletes. The app, available in June, connects to its suite of apps
that include running and training aids and provides access to Nike
experts.
Nike is opening a massive new innovation centre at its world
headquarters – says Parker.
Nike is planning to expand Jordan Brand outside basketball and
double its sales – Jayme Martin, VP and GM of Global
Categories.
Nike is trying to ignite female sneaker culture — Trevor
Edwards, Nike Brand President.
Nike’s next big territory to conquer is China — Elliott Hill,
President of Geographies and Sales.
 PEST analysis of Nike
Political factors Economic factors
 Must consider the taxation  Must target customer with
and manufacturing rules of good purchasing power.
each country.  Developing countries may
 Various political conflicts be good opportunity for
can always make customs Nike.
related processes difficult, or  Nike’s revenues are to some
prevent imports and exports. extent reliant on the low cost
 Nike must follow import and of labour in Far Eastern
export laws well. countries.
 Must consider the copyrights  Inflation, unemployment and
and designs of shoes and taxation, per capita income
apparels it produces. affects its profit.

Social factors Technological factors

 Need to target health  Nike uses its own
conscious people. technology to manufacture
 Nike shoes and apparel the products.
designs meet the latest  Nike uses its online sales
trends. well to sell its products.
 It is rightly focused on  Social media allows Nike to
sporty and athletic whittle away faster than
customers. ever.
 Must promote its products in  Nike is the great
Islamic countries. implementer of information
 Need to come up with technology in different field
environment friendly from designing, production,
products. marketing to distribution.
 Start-up scenario in India
Feeling lazy to go to the market? order on Big Basket (an online
delivery service), hungry and it's raining outside? order on
zomato, short on cash? Paytm karo!! Other than that,
FreshToHome being India's no.1 fish and meet online mall.
There is a major change in the way Indian society views
entrepreneurship and innovation. Earlier, the society considered a
very conservative view and the very idea of opening a startup,
leaving a settled job was glared upon. Apart from this funding
was a major problem back in the 2000s. But now, it's spring time
for India's startup financing industry. Creativity is actively
encouraged by the number of straight out of college
entrepreneurs, entrepreneurship competitions, government
intiatives and most importantly, failure is considered as doors to
success. People started seeing problems as they are not stop signs,
they are guidelines.
According to the World Banks’s Doing Business Report (DBR
2019), India has made a galloping jump of 23 notches in the
Ease of Doing Business rankings and is currently ranked at
77th position out of 190 countries. India showed an
improvement in six of the 10 parameters, having witnessed a
leap of 129 notches in ‘construction permit’, 66 in ‘trading
across borders’ and 19 in ‘starting a business’. According to
NASSCOM & ZINNOV, 2018 report, India ranks third globally
in terms of its ‘startup ecosystem’ after USA and China. India is
currently placed at the 57th place in the Global Innovation Index
and Bengaluru ranks as the third best city in the world to open a
startup. India added 1200+ startups in 2018 alone and there was
more than 50% growth in the number of ‘Advanced Tech’
startups.
What is Incubation?
“Incubation is a unique and highly flexible combination of
business development processes, infrastructure and people,
designed to nurture and grow new and small businesses by
supporting them through the early stages of development and
change." Business incubation is a process of support for
businesses with growth potential. It can be targeted at one or a
combination of support to Start-ups, Early stage businesses,
Established businesses with new products/ new directions.
(UKBI.2007)
Types of Incubation centres
In India, the process of incubation is provided in these four major
slots,
 Government
 University-backed
 Corporate
 Private
Here are some of the good Incubation centres across the India.
1. Innovation and Entrepreneurship (SINE), IIT Mumbai,
2. Technology Business Incubator, IIT Delhi
3. Technopark Technology Business Incubator (T-TBI), Kerala
4. Startup Village
5. Indian Angel Network (IAN)
6. Technopark TBI
7. Centre for Innovation, Incubation and Entrepreneurship
(CIIE), IIM Ahmedabad
8. NSRCEL, IIM Bangalore
9. GSF Accelerator
10. AngelPrime

Bibliography
(1) Shoe Dog: By the creator of Nike (Phil Knight)
(2) Shoe Dog: By the creator of Nike (Phil Knight)
(3) –
(4) https://www.britannica.com/topic/Nike-
Inc#targetText=It%20was%20founded%20in
%201964,went%20public%20two%20years
%20later. https://www.cnet.com/reviews/apple-
watch-series-2-nike-plus-preview/
(5) https://www.bbc.com/news/business-48851940
https://www.commondreams.org
https://qz.com/1042298/nike-is-facing-a-new-
wave-of-anti-sweatshop-protests/
(6) https://solecollector.com/news/2015/10/nike-
investor-day-2015
(7) -
(8) https://www.worldbank.org/content/dam/doingBus
iness/media/Annual-Reports/English/DB2019-
report_web-version.pdf
https://www.nasscom.in/knowledge-
center/publications/start-report-momentous-rise-
indian-start-ecosystem
(9) https://trak.in/tags/business/2012/03/27/top-5-
famous-startup-incubation-centers-india/