ENTREPRENEURSHIP

1) What do you mean by entrepreneurship?

Ans:- Entrepreneurship is the ability to identify an investment opportunity and to organize an

enterprise in order to contribute for the real economic growth. Entrepreneurship combines

many qualities such as innovation, risk taking combining factors of production etc. It to organize

an enterprise in order to lies more in the ability to minimize the use of factors of production

and to exploit them to maximum advantage. It largely depends on personal qualities like

accepting the challenge and bearing the risk.

2) What are the elements of entrepreneurship?

Ans: - The elements of Entrepreneurship are as follows:

a) Abilities and Skills: Entrepreneurship provides the abilities and skills of Entrepreneur for the

success of the enterprise. The individual possess the required skills appropriate to the kind

of business that they are proposing to run. Entrepreneurship provides the operational,

management and technical skills required for the success of the organization. The

requirement foe specialist skill depends on the type of industry.

b) Resources: The element to Entrepreneurship is resources. These include human and non-

human resources. It is not purely about money and equipment but also about intellectual

capability. Many Entrepreneurs are able to negotiate favorably against the odds when

establish their business. Entrepreneurship enable to indentify the resources required by the

by the organization.

c) Strategy and Vision: The Entrepreneurship provides a strategy and vision in terms of

thinking short term and long terms ahead and having some idea of where that business

might be in the future and prepares action plan to achieve that goal formulated.
 Entrepreneurship provides the strategy and vision for developing the existing market or

product, new products or markets and develops a particular aim of the business.

d) Choosing a Profit making Idea: Entrepreneurship helps in choosing a profit making idea.

Business idea is key to success. The idea may come from internal and external sources.

Following discovery and validation of the idea, Entrepreneurship also considers the

profitability which will generate income and makes the business a successful unit.

e) Legalities: Entrepreneurship provides the attention to the legal formalities. Rules and

regulations differ on the basis of type of organization selected to carry on its business

activities. The business unit is to be registered with the state and local governments. It has

to obtain permits, Licenses and TAX ID number.

3) What is the importance of Entrepreneurship?

Ans: - Following are the importance of Entrepreneurship: -

a) It Develops Managerial Capabilities: The most significant aspect of Entrepreneurship lies in

the fact that it helps in identifying and developing managerial capabilities of

Entrepreneurship. An Entrepreneur studies a problem, identifying its alternatives,

compares the alternatives in term of cost and benefits implications and finally chooses the

best alternative. It means right from generating an idea for business, till its implementation

all the all the managerial job is effectively undertaken with the Entrepreneurial qualities of

the Entrepreneur.

b) It Creates Organisations : Entrepreneurship helps in the creation of organization. It guides

the entrepreneurs to assemble and co-ordinate physical, human and non-human resources

and direct them towards achievement of enterprise objectives through specialized

managerial skills.
 c) It improves Standards of living: Entrepreneurship creates products and services which are

very much needed by the society. With the setting up of productive organizations,

Entrepreneurship helps in making a wide variety of goods and services available to the

society which results in higher standards of living of the people.

d) It Leads to Economic Development:- Entrepreneurship involves creation and use of

innovative ideas, maximization of output from given resources, development of managerial

skills etc., and all these factors are very essential for the economic development of a

country. It is the reason as to why many countries all over the world are concentrating on

Entrepreneurial development programmes (EDPs).

e) It Generates Employment: Entrepreneurship helps in generating employment directly and

indirectly. It helps the Entrepreneurs to become self-employed and self-sufficient and gives

an honorable life to them. They do not depend on the government jobs or private jobs and

directly employ themselves by starting their own enterprises. Indirectly, they also provide

jobs to many unemployed by setting up large, medium, small scale or micro enterprises.

f) It leads to balanced regional development: The entrepreneurship traits of Entrepreneurs

helps in removing regional disparities by setting up industries in backward areas. It is

because; the government is extending various concessions and subsidies to the

Entrepreneurs who take initiative to setup industries in the undeveloped regions.

4) What are the importances of creative behavior?

Ans: - The importance of creative behavior are as follows:-

1) It changes an existing domain or transforms an existing domain into new one.

2) It involves originality of thinking and uniqueness of presentation.

3) It leads to in-depth curiosity, commitment and illumination of an idea, product or service

required by the society by the society.

5) It is preceded by investigations and gathering of market information.

6) It allow the Entrepreneurs to apply their subconscious to mull over the tremendous

amounts of ideas and information that they accumulated during the preparation phase.

7) It enables to evaluate new idea and worth pursuing.

5) What are the barriers to / problems of Entrepreneurship?

Ans: - Following are the problems of Entrepreneurship: -

1) Lack of Viable Project: The enterprises cannot survive without economic feasibility. If the

entrepreneur’s assessment of project viability in incorrect, the project started is

undoubtedly a failure. Hence, every Entrepreneur should be in a position to predict the

economic viability of the proposed project which gives the desired results.

2) Lack of the market knowledge: Normally, the micro and small enterprises do not have

sufficient resources to gather market information from time-to-time. Hence, the

Entrepreneurs lack of knowledge of changes that are taking place in the markets. They

cannot update themselves in providing required products and service to the consumers.

3) Lack of Technical knowledge: - Most of the micro, small and medium enterprises lack

technical skills. These enterprises are facing technical problems such as ineffective

methods, processes and procedures in performing activities, performing tasks with poor

tools and etc. These barriers have been disturbing the development of industries.

4) Lack of initial capital: - The small Entrepreneurs have a problem of initial capital. They lack

both long term and short term capital which leads to instability of their profits. They do not

have internal resources and hence the enterprises cannot survive in the long run.

5) Lack of Business knowledge: - Some of the Entrepreneurs are lacking the knowledge of

business activities such as production, trade, banking, insurance, warehousing,

the enterprise in a short span of time.