Entrepreneurship DevelopmentUnit I Entrepreneurship: Entrepreneur - Types of Entrepreneurs – Difference between Entrepreneur and Intrapreneur - Entrepreneurship in Economic Growth, Factors Affecting Entrepreneurical Growth.

Unit II Motivation: Major Motives Influencing an Entrepreneur - Achievement Motivation Training, self Rating, Business Game, Thematic Apperception Test - Stress management, Entrepreneurship Development Programs - Need, Objectives.

Unit III Business: Small Enterprises - Definition, Classification - Characteristics, Ownership Structures - Project Formulation. Steps involved in setting up a Business - identifying, selecting a Good Business opportunity.

Unit IV Setting up Business Venture:Market Survey and Research, Techno Economic Feasibility Assessment - Preparation of Preliminary Project Reports - Project Appraisal - Sources of Information - Classification of Needs and Agencies.

Unit V Support to Entrepreneurs: Government Policy for Small Scale Enterprises - Growth Strategies in small industry - Expansion, Diversification, Joint Venture, Merger and Sub Contracting.

Reference: 1.S.S.KHANKA "Entrepreneurial Development" S.Chand & Co. Ltd. Ram Nagar, New Delhi, 1999. 2.Hisrich R D and Peters M P, "Entrepreneurship" 5th, Edition Tata McGraw-Hill, 2002. 3.Rabindra N. Kanungo "Entrepreneurship and innovation", Sage Publications, New Delhi, 1998. 4.EDII "Faulty and External Experts - A Hand Book for New Entrepreneurs Publishers: Entrepreneurship Development" Institute of India, Ahmadabad, 1986.

Entrepreneurship Development Unit I

Entrepreneurship: Entrepreneur - Types of Entrepreneurs – Difference between Entrepreneur and Intrapreneur - Entrepreneurship in Economic Growth, Factors Affecting Entrepreneurical Growth.

Meaning and Definition of entrepreneur

The word entrepreneur has come from the France word “entreprendra”which means to undertake, to pursue opportunities to fulfill needs and wants through innovation to undertake business.

In the year 1725 the word entrepreneur was first brought into economics by a social scientist named Richard cantilion.the expert who invented the theory of entrepreneurship was David mc cellion in 1961.

There was various definition of entrepreneur.

According to America heritage dictionary; 

“Entrepreneur is a person who organizes operates and assumes the risk for business venture”

The dictionary of social sciencehas defined entrepreneur from functional viewpoint. According to it “entrepreneur is a person 1) who exercise the function or 2) initiating coordinating controlling or institute major change in a business enterprise and or 3) bearing those risk of operation which arise from the dynamic nature of society and imperfect knowledge of the future which can cast through transfer calculation or elimination

According to encyclopedia Britannica

“Entrepreneur as the individual who bears the risk of operating a business in the face of uncertainty about future condition and who is rewarded accordingly by his profit or losses”.

Richard cotillion says 

“Entrepreneur is the agent who purchased the means of production for combination into marketable product”.

So we can say that entrepreneur a person who takes risk for establishing a new venture or business in order to create utility for the welfare of human being as well as for him of herself. She or he is always a person who seeks out opportunities and takes on challenges.

Meaning and Definition of entrepreneurship:

  Entrepreneurship is considered as of assuming the risk of an entrepreneur.

According to natheal h. leff: 

Entrepreneurship is the capacity for innovation investment and expansion in new markets product and techniques.

Webster highlights entrepreneurship as economic venture organizing and risk taking capabilities.

Joshep a Schumpeter describe entrepreneurship is the force of creative destruction whereby established way of doing things are destroyed by the creating of new and better ways to get things done.

According to S. S. kanaka: 

Entrepreneurships is a process involving various actions to be taken to establish an enterprise.

From the functional view point entrepreneurship is defined as the combination of activities such as perception of market opportunities gaining command over scarce resources purchasing input producing and marketing of product responding to competition and maintaining relation with political administration and public bureaucracy for concession licenses and taxes etc.

Characteristics of an entrepreneur:

An entrepreneur is a person who initiates a business venture. there are some essential feature of an entrepreneur which are describe below.

·         Risk taking capability: every business has risk of time money etc .so an entrepreneur must have the risk taking capability.

·         Creativity and innovation: an entrepreneur has an initiator possesses creativity and innovative power.

·         Need for achievement: the entrepreneur has strong desire to achieve the goal of business. he is always driven by the needs for achievement.

·         Need for autonomy: an entrepreneur does not like to be under anybody. it is the need for autonomy which drives a person to be an entrepreneur.

·         Internal locus of control: an entrepreneur believes in him his work.

·         External locus of control: he also believes in fate for ultimate result.

·         Self confident: an entrepreneur has confidence in him.

·         Leadership capability: an entrepreneur must have leadership capability to lead works under him

·         Industriousness: a successful entrepreneur must have leadership capability to lead workers working under him.

·         Decision making capability: the entrepreneur has capability to take quick decision

·         Adaptability: he has the capacity to adapt with any kind of situation that arise in the enterprise

·         Foresightness: The entrepreneurs have a good foresight to know about future business environment.

·         Others; the other feature are dynamism, ambition, education and training, long term involvement, future orientation.

                                     Qualities of successful entrepreneur:

To become a successful as an entrepreneur in its business life, a businessman should possess a quite a number of essential qualities. Those are noted below:

1.      Moderate risk taking: an entrepreneur always takes calculated risk to operate the organization

2.      Hard work: an entrepreneur is very much hard worker, he or she always busy with various types work.

3.      Accountability: a successful entrepreneur is accountable well as his associates always accountable to him.

4.      Educated in real sense: successful entrepreneur is educated In real sense .he tries to implement his organizational objectives through his education.

5.      Analytical mind: a successful entrepreneur is analytical minded. he scrutinizes every activity on the organization.

6.      Dynamic leadership: a successful entrepreneur is always dynamic to operate the organization

7.      Presence of mind: a successful entrepreneur is always at present of mind he is always aware of activities that to happening in the organization and around him

8.      Accommodative: a good entrepreneur has the capacity to make his own place at every sector

9.      Courageous and tactful: Corsages and techniques is very much

essential for a successful entrepreneur

10.  Maker of right decision: A successful entrepreneur makes right decision in right time in right place

11.  Foresighted: a successful entrepreneur foresights the future and take decision accordingly

12.  Right perception of things: A successful entrepreneur things in a right way

13.  Enjoy simple life: A successful entrepreneur always deals a simple life a general people of the society

14.  Strong desired to success: A successful entrepreneur have a strong desire to success. he is driven by the desire to success

15.   Innovation: innovation is the process of making new something. A successful entrepreneur is innovative

16.  Self confidence: A successful entrepreneur is self confidence. does not really on other for decision or fate

17.  Goal setting: a successful entrepreneur set the goal

18.  Keen observation: A successful entrepreneur always observes the origination

19.  Sociable: A successful entrepreneur is sociable person

20.  Loves to work; A successful entrepreneur is very much addicted to work

21.  Loves new ideas: A successful entrepreneur loves new ides of the organization

22.  Team builder: A successful entrepreneur builds a suitable team

23.  Clean understanding: A successful entrepreneur clearly understands every things

24.  Ability to conceptualize: A successful entrepreneur is able to conceptualize the reality

25.  other: the other qualities are patience, optimistic ,strategist, etc

Relationship between entrepreneur and entrepreneurship: 

The relationship between entrepreneur and entrepreneurship are discussed

below:

Entrepreneur             vsEntrepreneurship 

1)      Entrepreneur is a person.

Entrepreneurship is a process.

2)      Entrepreneur is an organizer.

Entrepreneurship is an organization. 

3)      Entrepreneur is an innovator.

Entrepreneurship is an innovation. 

4)      Entrepreneur is a risk bearer.

Entrepreneur is a risk bearing. 

5)      Entrepreneur is a motivator. 

Entrepreneur is a motivation.

6)      Entrepreneur is a creator.

Entrepreneur is a creation.

Entrepreneur is a visualizer. 

Entrepreneur is a vision.

Entrepreneur is a leader.

Entrepreneurship is a leadership.

Entrepreneur is an imitator.

Entrepreneurship is an imitation.

Distinction between an entrepreneur and a manager. 

Sometimes the word entrepreneur and manager are used as synonyms. In fact there are some differences between them. They are described below – 

Subject matter    ------------    Entrepreneur     ------------         Manager

1. Motive 

Thinking function. His main motive is to start a new venture by setting up an enterprise. 

Doing function. His main motive is to render service to the organization already established. 

2. Status 

Entrepreneur is the owner of the enterprise. 

Manager is the service holder or servant of the enterprise. 

3. Risk bearing 

Being owner of the enterprise assume all risk and uncertainty involved in the enterprise. 

As the servant don’t take or bear risk and uncertainty involved in the organization. 

4. Reward 

Reward is profit which is highly uncertain. 

Get salary as a reward which is fixed and certain.

5. Innovation 

An entrepreneur is an innovator. 

A manager is not an innovator in that sense he implements the plan prepared by the entrepreneur. 

6. Qualification 

They are not highly qualified but have extraordinary experience forecasting. 

They are highly qualified (institutional education). 

After the above discussion we can say that at a time an entrepreneur can be a manager but a manager cannot be an entrepreneur. 

Different types of entrepreneurs:

On the basis of nature Clarence Danhof classified entrepreneurs into four categories. These are – 

  1.   Innovative entrepreneurs: An innovative entrepreneur in one, who

introduces new goods, inaugurates new method of production, discovers new market and recognizes the enterprise. It is important to note that such entrepreneurs can work only when a certain level of development is already achieved and people look forward to change and improvement.

  2.   Imitative entrepreneurs: These types of entrepreneurs creatively imitate the innovative technical achievement made by another firm. Imitative entrepreneurs are suitable for underdeveloped countries as it is hard for them to bear the high cost of innovation. 

  3.   Fabian entrepreneurs: Fabian entrepreneurs are characterized by very great caution and skepticism to experiment any change in their enterprises. They usually do not take any new challenge. They imitate only when it becomes perfectly clear that failure to do not so would result in a loss of the relative position in the enterprise. 

  4.   Drone entrepreneurs: They are characterized by a refusal to adopt any change even at cost of severely reduction of profit. 

Some other types of entrepreneurs: 

(i) Solo operators: These are the entrepreneurs who essentially work alone and if needed at all employ a few employees. In the beginning most of the entrepreneurs start their enterprises like them. 

(ii)  Active partners: Active partners are those entrepreneurs who start or carry on an enterprise as a joint venture. It is important that all of them actively participate in the operations of the business. 

(iii)  Innovators: Such entrepreneurs with their competence and creativity innovate new products. Their basic interest lies in research and innovative activities. 

(iv) Buyers’ entrepreneurs: These are the entrepreneurs who do not like to bear much risk. They do not take the risk of production but take the risk of marketing a product i.e. wholesaler and retailer. 

(v) Life timers: These entrepreneurs believe business as an integral part of their life. These entrepreneurs actually inherit their family business i.e. goldsmith, potter etc. 

(vi) Challengers: These are the entrepreneurs who initiate business because of the challenges it presents. They believe that ‘No risk, No gain’. When one challenge seems to be met, they begin to look for new challenges. 

Beside these, there are Govt. and Non-govt. entrepreneurs. 

Factors of Entrepreneurship development:

     (A)   Personal factors 

1. ·        Ability to cope with the situation2. ·        Age3. ·        Education4. ·        Personality5. ·        Intrapersonal communication ability6. ·        Achievement motivation7. ·        Self-confidence8. ·        Competence9. ·        Emotion10. ·        Understanding capacity

    (B)  Environmental factors 

         1.  Socio-cultural factors 

·        Religion ·        Values ·        Rural-urban orientation ·        Marginality ·        Education ·        Tradition

       2. Political and legal factors 

·        Govt. legal bindings ·        Govt. policies ·        Rules and laws related to the industry and business  

    (C)  Institutional factors:

1. ·        Financial institution2. ·        Training and development institution3. ·        Consulting firms4. ·        Incubators organization (old & pioneer)5. ·        Research organization

     (D) Micro factors 

1. ·        Enterprise itself2. ·        Suppliers3. ·        Intermediaries4. ·        Customers5. ·        Competitors6. ·        Public

      (E) Macro factors: 

1. ·        Demographic factors2. ·        Economic factors3. ·        Physical factors4. ·        Technological factors5. ·        Cultural/social factors

     (F) Others:

1. ·        Venture capital2. ·        Experience entrepreneurs3. ·        Technically skilled labor force4. ·        Supplier’s accessibility5. ·        Proximity to universities6. ·        Availability of land facilities7. ·        Accessibility of transportation8. ·        Favorable loan and financial policies9. ·        Decepted population10. ·        Availability of supportive11. ·        Attractive living condition12. ·        Capital intensiveness13. ·        Research and development activities14. ·        Capital incentive ness15. ·        Proximity to corporate head quarters16. ·        Competitive situation

Causes of success and failure of entrepreneur:  

An entrepreneur may sometime become successful and sometime becomes failure. There are some causes of such success and failure. They are noted below:

1.      Selection of business: It is an important aspect. That means an entrepreneur has to determine what type business he is going to start. Form various points of view the feasibility of the business should be tested. 

2.      Proper planning: Proper planning me s also important. For planning, planning premises like political, economic, social premised should be considered first. The steps of planning should be followed properly. 

3.      Initial capital: if the initial capitals are not an optimal level the organization would fall. So whether the enterprise is big or small the initial capital should be sufficient enough. 

4.      Determination o0f market demand: Through research the demand in the market should be identified. Both for long term and short term it should be considered. 

5.      Marketing of product: If the promotion policy, channel of destitution, transportation is not good the enterprise would fall.

6.      Education and experience: One of the important tasks of the entrepreneurs is to select right person for the right post because the success of an enterprise depends on the right selection of employees.

7.      Joint initiative: One may have much money and another may have more merit. Through joint initiative it can be balanced. But sometime for joint initiative misunderstanding arise, or sometimes corruption occur which may result in fall of enterprise. 

8.      Employment: Recruitment and appointment should be properly done. Those who have specialized skill should be appointed to that specialized job. Inefficient, corrupted employees may be responsible for fall of business. 

9.      Location of business: Site selection is an important factor. While starting a new business, an entrepreneur should think about the location of the business. In this case, many factors should be considered such as availability of raw materials, proper communication system, availability of labor, marketing facilities and so on. 

10.  Qualities of management: The management must have a minimum quality to success otherwise it would fall.

These are the common causes for which one enterprise may become successful and another may fall.

Unit II Motivation: Major Motives Influencing an Entrepreneur - Achievement Motivation Training, self Rating, Business Game, Thematic Apperception Test - Stress management, Entrepreneurship Development Programs - Need, Objectives.

Motivation:

Definition of Motivation

Motivation is regarded "as the inner state that energizes activities and directs or channels behavior towards the goal". It can also be seen as a process that arouses action, sustains the activity in progress and that regulates the pattern of activity.

The motives can be categorizes as social and psychological motives.

Few of the social motives are

Self esteem Social acceptability

Competence building

Wealth generation

Self actualization

Major Motives Influencing an Entrepreneur

How Cultural Factors Influence Entrepreneurship

Culture refers to the customary practices and beliefs that have a significant impact on the basic values, perceptions, preferences, and behaviors of people.

Culture and entrepreneurship intervene in many ways.

People traditionally engaged in businesses have a pro business attitude and disdain working as employees.

Many people fall outside the establishment and remain unsuited for the traditional job market due to a strong culture of independence or other reasons.

Business school students come under the missionary zeal of teachers who exhort them to become entrepreneurs even if the opportunity cost is very high.

The culture of consumerism where people desire material goods encourages entrepreneurship within the area as returns from a business become more than returns from a job.

People engaged in jobs and other services pressure their children to find secure jobs and crush their entrepreneurship spirit at a very early age.

A culture of thrift where people spend less and save for a rainy day discourages entrepreneurship within the local community as the returns from a business become less attractive compared to returns from a job.

Cultures where people are risk averse and do not attach much importance to hard work and persistence are not conducive to entrepreneurship.

How Political Environments Support or Suppress Entrepreneurship

The following are some of the ways in which the political environment influences entrepreneurship:

Unstable political conditions where government policies change frequently discourage business, as investors fear for the safety of their investments.

Government support to economic development through infrastructure development, facilitation, industrial parks, and the like all encourage entrepreneurship.

High taxes that cut into the returns usually discourage entrepreneurs. On the other hand, tax holidays to encourage business attract start-ups.

The availability of infrastructure and utilities such as good roads, power, communication facilities, and lack of corruption and bureaucratic delays in obtaining such utilities encourage entrepreneurship.

Economic freedom in the form of favorable legislation and few hurdles to start and operate businesses encourage entrepreneurship.

While most businesses accept laws related to the safeguard of labor rights and the environment, some countries have retrograde laws that make compliance very difficult and time consuming. Such legal hurdles create a barrier to entrepreneurship.

How Economic Factors Influence Entrepreneurship

The nature of the economy is a major factor that influences entrepreneurship.

The general purchasing power of the people, manifested by income levels and economic prosperity of the region, plays a major role in the success of entrepreneurial ventures.

During times of economic slowdown or recession, the purchasing power declines and people remain reluctant to invest, affecting entrepreneurship adversely.

In a subsistence economy, most of the people are engaged in agriculture, consuming most of their output and bartering the rest for simple goods and services. Entrepreneurial opportunities are few in such scenarios.

Availability of Resources as a Major Factor that Affects Entrepreneurship

Critical factors that influence entrepreneurship include the availability of resources such as capital, human assets, raw materials, infrastructure, and utilities.

Capital remains indispensable to start an enterprise. The availability of capital allows the entrepreneur to bring together other factors and use them to produce goods or services.

The importance of human assets or employees can never be underestimated. No enterprise succeeds without a skilled and committed workforce.

The very existence of the business depends on the availability of raw materials to process.

Physical infrastructure and utilities such as good roads, parking, communication facilities, and power all play a crucial factor in the seamless functioning of a business.

How Entrepreneurial Skill Sets and Psychological Orientation Affects Entrepreneurship

All other factors notwithstanding, the success of an entrepreneurial venture depends on the entrepreneur. The entrepreneur is the leader and driver of the venture, and requires the following skill-set and orientation for success:

Hard work and persistence Ability to manage and minimize risk

Ability to draw up a comprehensive business plan, and having a contingency plan ready

A strong need-orientation that provides the inclination to achieve things

With the collapsing trade barriers bringing in greater opportunities, and job security passé, the conditions for entrepreneurship are better than ever before.

MOTIVES INFLUENCING ENTREPRENEURSHIP

Achievement motivation

is based on reaching success and achieving all of our aspirations in life. An individual with achievement motivation wishes to achieve objectives and advance up on the ladder of success. Here, accomplishment is important for its own sake and not for the rewards that accompany it. The capacity to derive satisfaction from the autonomous mastery of challenging tasks.

Power motivation

is the drive to influence people and change situations. Power motivated people wish to create an impact on their organization and are willing to take risks to do so. Includes need for control and prestige. The capacity to derive pleasure from having mental or emotional impact on other individuals or groups of individuals.

Affiliation motivation

is a drive to relate to people on a social basis. Persons with the affiliation motivation perform better when they are complimented for their favorable attitudes and co-operation. A capacity to derive satisfaction from establishing, maintaining, and restoring positive relationships with others.

Achievement motivation training

Achievement motivation is an integrative perspective based on the premise that performance motivation results from the way broad components of personality are directed towards performance. As a result, it includes a range of dimensions that are relevant to success at work but which are not conventionally regarded as being part of performance motivation. The emphasis on performance seeks to integrate formerly separate approaches as need for achievement with, for example, social motives like dominance. Personality is intimately tied to performance and achievement motivation, including such characteristics as tolerance for risk, fear of failure, and others.

Achievement motivation can be measured by The Achievement Motivation Inventory, which is based on this theory and assesses three factors (in 17 separated scales) relevant to vocational and professional success. This motivation has repeatedly been linked with adaptive motivational patterns, including working hard, a willingness to pick learning tasks with much difficulty, and contributing success to effort.

Achievement motivation was studied intensively by David C. McClelland, John W. Atkinson and their colleagues since the early 1950s. Their research showed that business managers who were successful demonstrated a high need to achieve no matter the culture. There are three major characteristics of people who have a great need to achieve according to McClelland’s research.

1. They would prefer a work environment in which they are able to assume responsibility for solving problems.

2. They would take calculated risk and establish moderate, attainable goals.

3. They want to hear continuous recognition, as well as feedback, in order for them to know how well they are doing.

SELF RATING

Evaluation of one’s own character, feelings, or behaviour, used as a tool in psychology to quantify people’s perception of themselves or assess mental health risks.

Business

At lower levels of Maslow's hierarchy of needs, such as physiological needs, money is a motivator, however it tends to have a motivating effect on staff that lasts only for a short period (in accordance with Herzberg's two-factor model of motivation). At higher levels of the hierarchy, praise, respect,

recognition, empowerment and a sense of belonging are far more powerful motivators than money, as both Abraham Maslow's theory of motivation and Douglas McGregor's theory X and theory Y (pertaining to the theory of leadership) demonstrate.

According to Maslow, people are motivated by unsatisfied needs. The lower level needs such as Physiological and Safety needs will have to be satisfied before higher level needs are to be addressed. We can relate Maslow's Hierarchy of Needs theory with employee motivation. For example, if a manager is trying to motivate his employees by satisfying their needs; according to Maslow, he should try to satisfy the lower level needs before he tries to satisfy the upper level needs or the employees will not be motivated. Also he has to remember that not everyone will be satisfied by the same needs. A good manager will try to figure out which levels of needs are active for a certain individual or employee.

Maslow has money at the lowest level of the hierarchy and shows other needs are better motivators to staff. McGregor places money in his Theory X category and feels it is a poor motivator. Praise and recognition are placed in the Theory Y category and are considered stronger motivators than money.

Motivated employees always look for better ways to do a job.

Motivated employees are more quality oriented.

Motivated workers are more productive.

The average workplace is about midway between the extremes of high threat and high opportunity. Motivation by threat is a dead-end strategy, and naturally staff are more attracted to the opportunity side of the motivation curve than the threat side. Motivation is a powerful tool in the work environment that can lead to employees working at their most efficient levels of production.

Nonetheless, Steinmetz also discusses three common character types of subordinates: ascendant, indifferent, and ambivalent who all react and interact uniquely, and must be treated, managed, and motivated accordingly. An effective leader must understand how to manage all characters, and more importantly the manager must utilize avenues that allow room for employees to work, grow, and find answers independently.

The assumptions of Maslow and Herzberg were challenged by a classic study at Vauxhall Motors' UK manufacturing plant. This introduced the concept of orientation to work and distinguished three main orientations: instrumental (where work is a means to an end), bureaucratic (where work is a source of status, security and immediate reward) and solidaristic (which prioritizes group loyalty).

Other theories which expanded and extended those of Maslow and Herzberg included Kurt Lewin's Force Field Theory, Edwin Locke's Goal Theory and Victor Vroom'sExpectancy theory. These tend to stress cultural differences and the fact that individuals tend to be motivated by different factors at different times.

According to the system of scientific management developed by Frederick Winslow Taylor, a worker's motivation is solely determined by pay, and therefore management need not consider psychological or social aspects of work. In essence, scientific management bases human motivation wholly on extrinsic rewards and discards the idea of intrinsic rewards.

In contrast, David McClelland believed that workers could not be motivated by the mere need for money—in fact, extrinsic motivation (e.g., money) could extinguish intrinsic motivation such as

achievement motivation, though money could be used as an indicator of success for various motives, e.g., keeping score. In keeping with this view, his consulting firm, McBer & Company, had as its first motto "To make everyone productive, happy, and free." For McClelland, satisfaction lay in aligning a person's life with their fundamental motivations.

Elton Mayo found that the social contacts a worker has at the workplace are very important and that boredom and repetitiveness of tasks lead to reduced motivation. Mayo believed that workers could be motivated by acknowledging their social needs and making them feel important. As a result, employees were given freedom to make decisions on the job and greater attention was paid to informal work groups. Mayo named the model the Hawthorne effect. His model has been judged as placing undue reliance on social contacts within work situations for motivating employees.

William Ouchi introduced Theory Z, a hybrid management approach consisting of both Japanese and American philosophies and cultures. Its Japanese segment is much like the clan culture where organizations focus on a standardized structure with heavy emphasis on socialization of its members. All underlying goals are consistent across the organization. Its American segment retains formality and authority amongst members and the organization. Ultimately, Theory Z promotes common structure and commitment to the organization, as well as constant improvement of work efficacy.

In Essentials of Organizational Behavior, Robbins and Judge examine recognition programs as motivators, and identify five principles that contribute to the success of an employee incentive program:

Recognition of employees' individual differences, and clear identification of behavior deemed worthy of recognition

Allowing employees to participate

Linking rewards to performance

Rewarding of nominators

Visibility of the recognition process

GamesMotivational models are central to game design, because without motivation a player will not be interested in progressing further within a game. Several models for gameplay motivations have been proposed, including Richard Bartle's. Jon Radoff has proposed a four-quadrant model of gameplay motivation that includes cooperation, competition, immersion and achievement. The motivational structure of games is central to the gamification trend, which seeks to apply game-based motivation to business applications.

Thematic Apperception Test

The Thematic Apperception Test (TAT), is a projective psychological test. Proponents of this technique assert that a person's responses reveal underlying motives, concerns, and the way they see the social world through the stories they make up about ambiguous pictures of people.[1] Historically, it has been among the most widely researched, taught, and used of such tests.

The TAT was developed during the 1930s by the American psychologist Henry A. Murray and lay psychoanalyst Christiana D. Morgan at the Harvard Clinic at Harvard University. A widely held belief is that the idea for the TAT emerged from a question asked by one of Murray's undergraduate students, Cecilia Roberts. She reported that when her son was ill, he spent the day making up stories about images in magazines and she asked Murray if pictures could be employed in a clinical setting to explore the underlying dynamics of personality.

Procedure

The TAT is popularly known as the picture interpretation technique because it uses a series of provocative yet ambiguous pictures about which the subject is asked to tell a story. The TAT manual provides the administration instructions used by Murray, although these procedures are commonly altered. The subject is asked to tell as dramatic a story as they can for each picture presented, including the following:

what has led up to the event shown

what is happening at the moment

what the characters are feeling and thinking

what the outcome of the story was

If these elements are omitted, particularly for children or individuals of low cognitive abilities, the evaluator may ask the subject about them directly. Otherwise, the examiner is to avoid interjecting and should not answer questions about the content of the pictures. The examiner records stories verbatim for later interpretation.

The complete version of the test contains 32 picture cards. Some of the cards show male figures, some female, some both male and female figures, some of ambiguous gender, some adults, some children, and some show no human figures at all. One card is completely blank and is used to elicit both a scene and a story about the given scene from the storyteller. Although the cards were originally designed to be matched to the subject in terms of age and gender, any card may be used with any subject. Murray hypothesized that stories would yield better information about a client if the majority of cards administered featured a character similar in age and gender to the client.[6]

Although Murray recommended using 20 cards, most practitioners choose a set of between 8 and 12 selected cards, either using cards that they feel are generally useful, or that they believe will encourage the subject's expression of emotional conflicts relevant to their specific history and situation.[7] However, the examiner should aim to select a variety of cards in order to get a more global perspective of the storyteller and to avoid confirmation bias (i.e., finding only what you are looking for).

Many of the TAT drawing consists set of themes such as success and failure, competition and jealousy, feeling about relationships, aggression and sexuality. These are usually depicted through picture cards.

Stress management

Many businesses today have begun to use stress management programs for employees who are having trouble adapting to stress at the workplace or at home. Many people have spill over stress from home into their working environment. There are a couple of ways businesses today try to

alleviate stress on their employees. One way is individual intervention. This starts off by monitoring the stressors in the individual. After monitoring what causes the stress, next is attacking that stressor and trying to figure out ways to alleviate them in any way. Developing social support is vital in individual intervention, being with others to help you cope has proven to be a very effective way to avoid stress. Avoiding the stressors all together is the best possible way to get rid of stress but that is very difficult to do in the workplace. Changing behavioral patterns, may in turn, help reduce some of the stress that is put on at work as well.

Employee assistance programs can include in-house counseling programs on managing stress. Evaluative research has been conducted on EAPs that teach individual stress control and inoculation techniques such as relaxation, biofeedback, and cognitive restructuring. Studies show that these programs can reduce the level of physiological arousal associated with high stress. Participants who master behavioral and cognitive stress-relief techniques report less tension, fewer sleep disturbances, and an improved ability to cope with workplace stressors.

Another way of reducing stress at work is by simply changing the workload for an employee. Some may be too overwhelmed that they have so much work to get done, or some also may have such little work that they are not sure what to do with themselves at work. Improving communications between employees also sounds like a simple approach, but it is very effective for helping reduce stress. Sometimes making the employee feel like they are a bigger part of the company, such as giving them a voice in bigger situations shows that you trust them and value their opinion. Having all the employees mesh well together is a very underlying factor which can take away much of workplace stress. If employees fit well together and feed off of each other, the chances of lots of stress is very minimal. Lastly, changing the physical qualities of the workplace may reduce stress. Changing things such as the lighting, air temperature, odor, and up to date technology.

Intervention is broken down into three steps: primary, secondary, tertiary. Primary deals with eliminating the stressors all together. Secondary deals with detecting stress and figuring out ways to cope with it and improving stress management skills. Finally, tertiary deals with recovery and rehabbing the stress all together. These three steps are usually the most effective way to deal with stress not just in the workplace, but overall.

Need and importance of entrepreneurial development training programme

The entrepreneurs play an important role in the economic development of any country. Entrepreneurs make use of the factors of production to the fullest advantage of t h e   s o c i e t y ,   g e n e r a t e   e m p l o y m e n t ,   c r e a t e   i n n o v a t i o n ,   i m p r o v e   s t a n d a r d   o f   l i v i n g ,develop  backward  areas,  etc.  all  these  leads  to  higher  economic  growth. Soe n t r e p r e n e u r i a l   d e v e l o p m e n t   i s   v e r y   e s s e n t i a l   f o r   t h e   e c o n o m i c   d e v e l o p m e n t   o f   acountry.The entrepreneurship development programmes has an important role to play insolving the unemployment problem. Unemployment is demoralizing. It is the major source of waste in our present economic system.The most alarming form of unemployment today is educated unemployment. I n d i a   i s   f a c i n g   a   c h r o n i c   p r o b l e m   o f   u n e m p l o y m e n t .   D u e   t o   t h i s   f r u s t ra t i o n   a n d d i s c o n t e n t   i n c r e a s e s ,   t h e   r a t e   o f   c r i m e   a l s o   i n c r e a s e s .   I n s t e a d o f   g o i n g   a f t e r   a government job, people should make an effort to get themselves by starting their

ownbusiness.Under these circumstances entrepreneurship development programme assumesmuch

importance.

What are the objectives of Entrepreneurship Development Programme?

The basic objectives of EDP are to:1. Develop and strengthen entrepreneurial quality, i.e., motivation or need for achievement.2. To analyze environmental set up relating to small industry and promoting it.3. Removing unemployment4. enhancing industrial development5. Developing industrially backward region.6. Select project/product.7. Formulate the project.8. Understand the process and procedure involved in setting up small units.9. Know the sources of help and support available for starting a small-scale industry.10. Acquire necessary managerial skill required to run the industrial unit.11. Know the pros and cons of being an entrepreneur.12. Helping the person to understand environmental changes and opportunities.13. Acquaint and appreciate the needed social responsibility/ entrepreneurial discipline

Unit III Business: Small Enterprises - Definition, Classification - Characteristics, Ownership Structures - Project Formulation. Steps involved in setting up a Business - identifying, selecting a Good Business opportunity.

Business

A business, also known as an enterprise or a firm, is an organization involved in

the trade of goods, services, or both to consumers. Businesses are prevalent in capitalist economies,

where most of them are privately owned and provide goods and services to customers in exchange of

other goods, services, or money. Businesses may also benot-for-profit or state-owned. A business

owned by multiple individuals may be referred to as a company.An organization or enterprising entity engaged in commercial, industrial or professional activities. A business can be a for-profit entity, such as a publicly-traded corporation, or a non-profit organization engaged in business activities, such as an agricultural cooperative.Any commercial, industrial or professional activity undertaken by an individual or a group.A reference to a specific area or type of economic activity.

Small and medium Enterprises

Small and medium enterprises (SMEs) or small and medium-sized businesses (SMBs) are companies whose personnel numbers fall below certain limits. The abbreviation "SME" is used in the European Union and by international organizations such as the World Bank, the United Nations and the World Trade Organization(WTO). Small enterprises outnumber large companies by a wide margin and also employ many more people. SMEs are also said to be responsible for driving innovation and competition in many economic sectors.

classification

Agriculture  and mining businesses produce raw material, such as plants or minerals. Financial  businesses include banks and other companies that generate profits through

investment and management of the capital.

Information businesses generate profits primarily from the sale of intellectual property and include movie studios, publishers and internet and software companies.

Manufacturers  produce products, from raw materials or from component parts, then sell their products at a profit. Companies that make tangible goods such as cars,clothing or pipes are considered manufacturers.

Real estate  businesses sell, rent, and develop properties including land, residential homes, and other buildings.

Retailers  and distributors act as middlemen and get goods produced by manufacturers to the intended consumers, and make their profits by marking up their price. Most stores and catalog companies are distributors or retailers.

Service businesses  offer intangible goods or services and typically charge for labor or other services provided to government, consumers, or other businesses. Interior decorators, consulting firms and even entertainers are service businesses.

Transportation  businesses deliver goods and individuals to their destinations for a fee.

Utilities  produce public services such as electricity or sewage treatment, usually under a government charter.

Essential characteristics of Small Scale Enterprises

Following are the characteristics of some industries which identify them as small-scale industries:

1. Labour intensive:

Small-scale industries are fairly labour-intensive. They provide an economic solution by creating employment opportunities in urban and rural areas at a relatively low cost of capital investment.

2. Flexibility:

Small-scale industries are flexible in their operation. They adopt quickly to various factors that play a large part in daily management. Their flexibility makes them best suited to constantly changing environment.

3. One-man show:

A small-scale unit is generally a one-man show. It is mostly set up by individuals. Even some small units are run by partnership firm or company, the activities are mainly carried out by one of the partners or directors. Therefore,' they provide an outlet for expression of the entrepreneurial spirit. As they are their own boss, the decision making process is fast and at times more innovative.

4. Use of indigenous raw materials:

Small-scale industries use indigenous raw materials and promote intermediate and capital goods. They contribute to faster balanced economic growth in a transitional economy through decentralisation and dispersal of industries in the local areas.

5. Localised operation:

Small-scale industries generally restrict their operation to local areas in order to meet the local and regional demands of the people. They cannot enlarge their business activities due to limited resources.

6. Lesser gestation period:

Gestation period is the period after which the return or investment starts. It is the time period between setting the units and commencement ol production. Small-scale industries usually have a lesser gestation period than large industries. This helps the entrepreneur to earn after a short period of time. Capital will not be blocked for a longer period.

7. Educational level:

The educational level of the employees of small industries is normally low or moderate. Hardly there is any need of specialised knowledge and skill to operate and manage the SSI.

8. Profit motive:

The owners of small industries are too much profit conscious. They always try to keep high margins in their pricing. This is one of the reason for which the unit may lead to closure.

Basic forms of business ownershipForms of business ownership vary by jurisdiction, but several common forms exist-

Sole proprietorship: A sole proprietorship is owned by one person and operates for their benefit. The owner may operate the business alone or with other people. A sole proprietor has unlimited liability for all obligations incurred by the business, whether from operating costs or judgements against the business. All assets of the business belong to a sole proprietor, including, for example, computer infrastructure, any inventory, manufacturingequipment and/or retail fixtures, as well as any real property owned by the business.

Partnership: A partnership is a business owned by two or more people. In most forms of partnerships, each partner has unlimited liability for the debts incurred by the

business. The three most prevalent types of for-profit partnerships are general partnerships, limited partnerships, and limited liability partnerships.

Corporation: The owners of a corporation have limited liability and the business has a separate legal personalityfrom its owners. Corporations can be either government-owned or owned by individuals. They can organize either for profit or as not-for-profit organizations. A non-government for-profit corporation is owned by its shareholders, who elect a board of directors to direct the corporation and hire its managerial staff. A privately owned, for-profit corporation can be either privately held by a small group of individuals, or publicly held, with publicly tradedshares listed on a stock exchange.

Cooperative: Often referred to as a "co-op", a cooperative is a limited liability business that can organize for-profit or not-for-profit. A cooperative differs from a corporation in that it has members, not shareholders, and they share decision-making authority. Cooperatives are typically classified as either consumer cooperativesor worker cooperatives. Cooperatives are fundamental to the ideology of economic democracy.

Project Formulation

Project formulation is defined as “taking a first look carefully and critically at a project idea by an entrepreneur to build up an all-round beneficial to the project after carefully weighing its various components.” In short Project Formulation is a process whereby the entrepreneur makes an objective and independent assessment of the various aspects of an investment proposition of a project idea for determining its total impact and also its liabilities.

Project Formulation is a concise, exact statement of a project to set the boundaries or limits of work to be performed by the project. It is a formal document that gives a distinctive identity of the project and precise meaning of project work to prevent conflict, confusion, or overlap.

Project formulation can be also defined as one of the stages in the lifecycle of a project. The formulation stage is also called Initiation, Conceptualization, Definition, Pre-Project. This stage aims to:

Carefully identify and weight various components of project work Analyze project feasibility and cost-effectiveness

Examine and approve project inputs and outputs

Identify stakeholders and their involvement and contribution

Define benefits and expectations

Estimate resources needed

Perform a preliminary analysis of risks

Make an outline of project schedule

10 Steps to Start a Business

Starting a business involves planning, making key financial decisions and completing a series of legal activities. These 10 easy steps can help you plan, prepare and manage your business. Click on the links to learn more.

Step 1: Write a Business Plan

Use these tools and resources to create a business plan. This written guide will help you map out how you will start and run your business successfully.

Step 2: Get Business Assistance and Training

Take advantage of free training and counseling services, from preparing a business plan and securing financing, to expanding or relocating a business.

Step 3: Choose a Business Location

Get advice on how to select a customer-friendly location and comply with zoning laws.

Step 4: Finance Your Business

Find government backed loans, venture capital and research grants to help you get started.

Step 5: Determine the Legal Structure of Your Business

Decide which form of ownership is best for you: sole proprietorship, partnership, Limited Liability Company (LLC), corporation, S corporation, nonprofit or cooperative.

Step 6: Register a Business Name ("Doing Business As")

Register your business name with your state government.

Step 7: Get a Tax Identification Number

Learn which tax identification number you'll need to obtain from the IRS and your state revenue agency.

Step 8: Register for State and Local Taxes

Register with your state to obtain a tax identification number, workers' compensation, unemployment and disability insurance.

Step 9: Obtain Business Licenses and Permits

Get a list of federal, state and local licenses and permits required for your business.

Step 10: Understand Employer Responsibilities

Learn the legal steps you need to take to hire employees.

Startup Resources

There are a number of available programs to assist startups, micro businesses, and underserved or disadvantaged groups. The following resources provide information to help specialized audiences start their own businesses.

Environmentally-Friendly "Green" Business

Home-Based Business

Online Business

Self Employment

Minority Owned Business

Veteran Owned Business

Woman Owned Business

IDENTIFYING AND SELECTING A GOOD BUSINESS OPPORTUNITY

StrengthsThese are advantages that you have over most practice teams. As you list them, decide how you can demonstrate that you’re really achieving what you say you are. For example, if you say you offer a pleasant working environment, can you demonstrate lower than average turnover? Strengths might include financial resources, capacity for production, people, or your facility.

2. WeaknessesYour weaknesses limit your practice’s performance, holding you back somehow. For each weakness you list, you must decide what to do about it. Will you tolerate the weakness? Manage it with some kind of work around? Or is this something you’re going to change?

3. OpportunitiesOpportunities are situations outside of your practice that you may be able to exploit to create positive results. After your team makes a list of possible opportunities, you’ll prioritize them to decide what to pursue first. Which idea offers the greatest potential reward for the least risk? That should be at the top of your list. Ideally, you want to take advantage of your opportunities and develop them into new strengths.

4. ThreatsSome problems are outside your direct influence, and yet they still could hurt your business. This is where you’d list a soft economic environment, for example. You can’t control these problems, or you would. But you should talk about how best to respond to each risk.

1. Never reject a business opportunity because you see a flaw in it. That it has a flaw doesn’t mean it can ‘t succeed. Ask how the flaw can be corrected.

2. Never reject a business opportunity because you won’t get the credit. It is the impact of the success on your overall business that really matter, not who gets the credit for proposing the idea.

3. Never reject a business opportunity because it looks impossible. Go ask the Wright brothers, nobody thought it was possible to fly .

4. Never reject a business opportunity because your mind is already made up on other possibilities. It won’t hurt if you have an open mind and consider all options on their individual merit before settling for one.

5. Never reject a business opportunity because you think it is illegal. Get expert legal opinion before trashing the idea.

6. Never reject a business opportunity because you don’t have the money, manpower, muscle or resources required. Whatever happened to partnership, joint ventures etc. You must not insist on getting 100% returns and eating it all alone. Also, 10 return from a $1,000,000 joint venture deal is better than 100% return from a $1,000 deal you did all alone. Look at the big picture before making your choice.

7. Never reject a business opportunity because it will create conflict. If you’re not ready for conflict, then you’re not ready for success.

8. Never reject a business opportunity because it is not your way of doing things. You can learn to do better than you’re already doing. Be an avid learner.

9. Never reject a business opportunity because it might fail. Life is all about taking risk. It is actually risky not to take risk.

10. Never reject a business opportunity because of your personal emotions. Human feelings are quite unstable. It doesn’t take much for emotions to change. So, never bring your emotions into business decisions.

Unit IV Setting up Business Venture:Market Survey and Research, Techno Economic Feasibility Assessment - Preparation of Preliminary Project Reports - Project Appraisal - Sources of Information - Classification of Needs and Agencies.

DEFINITION

Start-up entity developed with the intent of profiting financially. A business venture may also be considered a small business. Many ventures will be invested in by one or more individuals or groups with the expectation of the business bringing in a financial gain for all backers. Most business ventures are created based on demand of the market or a lack of supply in the market. Needs of consumers are identified for aproduct or a service and the entrepreneur and investors will proceed to develop the idea, market the idea, and sell the product or service developed.

Market Survey And Research

Market research is any organized effort to gather information about target markets or customers. It is a very important component of business strategy. The term is commonly interchanged with marketing research; however, expert practitioners may wish to draw a distinction, in that marketing research is concerned specifically about marketing processes, while market research is concerned specifically with markets.

Market research is a key factor to maintain competitiveness over competitors. Market research provides important information to identify and analyze the market need, market size and competition.

Market research, which includes social and opinion research, is the systematic gathering and interpretation of information about individuals or organizations using statistical and analytical methods and techniques of the applied social sciences to gain insight or support decision making.

Market Surveys

Definition

The study of the spending characteristics and purchasing power of the consumer who are

within your business's geographic area of operation; a research method for defining the

market parameters of a business.

The following five steps in doing a market survey were also discussed in the session:

Step1: Define objectives and specify information to be collected

• Identifying sources of information

• Assessing time and costs required for the survey

• Selecting methodology

• Preparing an action plan

Step 2: Select a sample

• Determining where to conduct the survey

• Determining when to conduct the survey

Step 3: Prepare a questionnaire for the survey

Step 4: Collect data and analyze the information obtained

Step 5: Prepare a report based on data analyzed

In the session, participants discussed the following ten broad areas for information collection:

• Market

• Buyers/ customers

• Raw materials

• Machinery, equipment

• Competitors

• Furniture

• Manpower

• Capital and risks

• Rules and regulations

• Marketing

TECHNO ECONOMIC FEASIBILITY ASSESSMENT

Feasibility study report is prepared to support the investment proposal. Feasibilities for the various aspects related to technical, commercial and financial are examined in detail by the experts and consultants brought in feasibility study report. Feasibility study report is termed as a techno economic feasibility study. 

______________________________________________________________________________

It is the primary report for the formulation of the investment proposal. Investment decisions are taken based on the details incorporated in the study. Thus feasibility is prepared only for the formulation and investment decision-making. The first step in feasibility study is the needs analysis. The purpose is to define overall objectives of the system proposed to be designed. The second and perhaps the most important thing is system identification. This is referred to as activity analysis.

Feasibility study report contains:

§ A broad indication of demand and availability of the product.§ Required sources for the development of the project.§ Selection of suitable process and technology.§ Fixation of capacity on the basis of the project.§ Process description and layout plans for the project.§ Available facilities.§ Evaluation of available facilities.§ Capital cost.§ Profitability analysis.§ Project schedule and schedule control.§ Design and flow diagrams.

After the preparation of feasibility study report has been prepared, it should be submitted to the experts the concerned departments of operation such as finance, commercial, project etc examine this. In case of any differences, the feasibility study report is discussed with the experts, consultants and is modified according to it.

Detailed project report:

Preparation of detailed project report is further step in firming up the proposal. When an investment proposal has been approved on the basis functional report and the proposal is a

major proposal, it would be necessary to detailed project report to firm up the proposal for the capital cost as well as the various facilities. It includes...

§ Examination of technological parameters.§ Description of the technology to be used.§ Broad technical specification.§ Evaluation of the existing resources.§ Schedule plan.§ General layout.§ Volume of work.

Hence these reports are to be made before investment is made into project. Thus formulation of investment is based on the studies is made. These can be considered as pre-investment decision. Detailed project report is prepared only for the investment decision-making approval, but also execution of the project and also preparation of the plan. Detailed project report additionally includes that is contents in addition to Feasibility study reports are.

§ Project description.§ Planning and implementation of the project.§ Specifications.§ Layouts and flow diagrams.

Detailed project report is a complete document for investment decision-making, approval, planning whereas feasibility study report is a base document for investment decision-making. Detailed project report is base document for planning the project and implementing the project.

The Detailed Project Report (DPR) is an essential building block for the Jawaharlal

Nehru National Urban Renewal Mission (JNNURM) in creating infrastructure and

enabling sustainable quality service delivery. The DPR is to be prepared carefully

and with sufficient details to ensure appraisal, approval, and subsequent project

implementation in a timely and efficient manner.

Project Preliminary Report is a formal document that describes specific activities, events, occurrences, or subjects of a project to explain progress of the project up to a certain point in time (but not later than completion time). This document is presented and communicated at project status meetings to explain what goals, deliverables and results are produced and what activities are still in progress. The document serves as the basis for developing the final project report.

 A typical preliminary report for projects highlights the following data:

Problem/need: A clear description of the problem or need the project aims to handle.

Proposed solution: a brief description of how to address the problem/need.

Work effort: An analysis summary of work relevant to the project.

Status: current state of project work, including activities completed and unfinished.

Evaluation: an analysis and assessment of project work by specific criteria such as cost-effectiveness, feasibility, manageability, performance, others.

Schedule: a timeline with specific milestones and events related to project work.

Project appraisal

Project appraisal is a generic term that refers to the process of assessing, in a structured way, the case for proceeding with a project or proposal. In short, project appraisal is the effort of calculating a project's viability.[1] It often involves comparing various options, using economic appraisal or some other decision analysis technique. Systematic and comprehensive review of the economic, environmental, financial, social, technical and other such aspects of a project to determine if it will meet its objectives.

Process

Initial Assessment Define problem and long-list

Consult and short-list

Develop options

Compare and select Project appraisal

Information source

'Information sources is very important sources.information sources is very imporant for everyone.examples of information sources newspapers,magzines, articles, books,e-resources etc'

An information source is a source of information for somebody, i.e. anything that might inform a person about something or provide knowledge about it. Different types of questions require different sources of information. Information sources may be observations, people, speeches, documents, pictures, organizations, websites, etc. They may be primary sources, secondary sources, tertiary sources and so on.

Empiricism regards sense data as the ultimate information sources, while other epistemologies have different any thing or place from which something comes, arises, or is obtained; origin: Which foods are sources of calcium? 2. the beginning or place of origin of a stream or river. 3. a book, statement, person, etc., supplying 4. the person or business making interest or dividend payments. 5. a manufacturer or supplierviews.

Primary Sources:A Primary Source of information is a firsthand or eyewitness account of an event. It is also raw data or facts which were gathered at an event. They are direct sources of information. 

Primary sources include diaries, letters, newspaper articles reported from an event, public documents, laws, court records, speeches, statistics, surveys, logs, journals, family bibles,

etc. 

A Primary Source of Information is actual evidence presented without any analysis or interpretation.

Secondary Sources:A Secondary Source of information is something which comes after the fact. It is literature that analyzes, interprets, relates or evaluates a primary source or other primary sources. Textbooks, encyclopedias, dictionaries, any book or article which is an interpretation of events, or of primary sources are considered secondary sources. 

This does not mean that secondary materials are not good sources of information. Often by collecting data from a number of different primary sources, new ideas and insights into an event may be found.

Combination Sources:Actually, the distinctions between Primary and Secondary materials can get very blurry. Think about the autobiography which was written many years later. The person has a long time to think about, analyze and interpret events and to exaggerate or "forget" certain details. While it is a firsthand account, it is probably not without some bias. 

Now consider legal documents, forms which are filled out. Most, like a marriage certificate or birth certificate, are filled out and signed at the time of the event. These are clearly primary documents. But think about other forms you might fill out with information about your parents. You were not around when they were born, so data regarding their place and date of birth would be secondary information. A death certificate is generally considered both a primary and secondary source of information. The information relating to the death, time place cause, etc., is primary but any information regarding the birth of that person is generally provided by a child or spouse, who was not around at the time to be an eye witness, so it would be secondary information.

CLASSIFICATION OF NEEDSInformation need is an individual or group's desire to locate and obtain information to satisfy a conscious or unconscious need. The ‘information’ and ‘need’ in ‘information need’ are an inseparable interconnection. Needs and interests call forth information. The objectives of studying information needs are:

1. The explanation of observed phenomena of information use or expressed need;2. The prediction of instances of information uses;

3. The control and thereby improvement of the utilization of information manipulation of essentials conditions.

Information needs are related to, but distinct from information requirements. An example is that a need is hunger; the requirement is food.

The concept of information needs was coined by an American information gernalist Robert S. Taylor in his article "The Process of Asking Questions" published in American

Documentation (Now is Journal of the American Society of Information Science and Technology).

In this paper, Taylor attempted to describe how an inquirer obtains an answer from an information system, by performing the process consciously or unconsciously; also he studied the reciprocal influence between the inquirer and a given system.

According to Taylor, information need has four levels:

1. The conscious and unconscious need for information not existing in the remembered experience of the investigator. In terms of the query range, this level might be called the “ideal question” — the question which would bring from the ideal system exactly what the inquirer, if he could state his need. It is the actual, but unexpressed, need for information

2. The conscious mental description of an ill-defined area of in decision. In this level, the inquirer might talk to someone else in the field to get an answer.

3. A researcher forms a rational statement of his question. This statement is a rational and unambiguous description of the inquirer’s doubts.

4. The question as presented to the information system.

There are variables within a system that influence the question and its formation. Taylor divided them into five groups: general aspects (physical and geographical factors); system input (What type of material is put into the system, and what is the unit item?); internal organization (classification, indexing, subject heading, and similar access schemes); question input (what part do human operators play in the total system?); output (interim feedback).

Herbert Menzel preferred demand studies to preference studies. Requests for information or documents that were actually made by scientists in the course of their activities form the data for demand studies. Data may be in the form of records of orders placed for bibliographics, calls for books from an interlibrary loan system, or inquires addressed to an information center or service. Menzel also investigated user study and defined information seeking behaviour from three angles:

1. When approached from the point of view of the scientist or technologists, these are studies of scientists’ communication behaviour;

2. When approached from the point of view of any communication medium, they are use studies;

3. When approached from the science communication system, they are studies in the flow of information among scientists and technologists.

William J. Paisley moved from information needs/uses toward strong guidelines for information system. He studied the theories of information-processing behavior that will generate propositions concerning channel selection; amount of seeking; effects on productivity of information quality, quantity, currency, and diversity; the role of motivational and personality factors, etc. He investigated a concentric conceptual framework for user

research. In the framework, he places the information users at the centre of ten systems, which are:

1. The scientist within his culture.2. The scientist within a political system.

3. The scientist within a membership group.

4. The scientist within a reference group.

5. The scientist within an invisible college.

6. The scientist within a formal organization.

7. The scientist within a work team.

8. The scientist within his own head.

9. The scientist within a legal/economical system.

10.The scientist within a formal.

There are different various types of kind agents are as follows.(a.)Sub-Agent:Sub-agency denotes delegation of power by an agent to a person appointed by him as sub-agent. Incidentally the agent himself is delegate of his principal. The principal is that 'a delegate cannot delegate'. According to this, a person to whom powers have been delegate cannot delegate them to another. Section 190 of the Act. Contains this principle. Generally, an agent cannot lawfully employ another to perform acts, which he has expressly. But, if by the ordinary custom of trade, a sub-agent may be employed, the agent may to do so.A sub-agent, according to section 191, is a person whom the original agent employs in the business of the agency and who under the control of the original agent. Thus the relation of the sub-agent to the original agent is, as between themselves, that of the agent and the principal.We shall now discuss the Impact of the appointment of a sub-agent from the following two angles:-(i.)In case of proper appointment: The agent is responsible to the principal for the acts of the sub-agent. Thus, a commission agent for the sale of goods who makes a proper employment of a sub-agent for selling his principal's goods is liable to the principal for the fraudulent disposition of the goods by sub-agent within the course of his employment.(ii.)In the case of appointment without authority: In term of Section 193, the principal is not bound by the acts of the sub-agent, nor is the sub-agent liable to the principal. The agent is the principal of the sub-agent both to the principal and the third party.(b.) Substituted Agent:Substituted agents are different from sub-agents. Section 194 provides that substituted agents are not sub-agents but are in fact agents of the principal. Suppose an agent has an implied authority to name another person to act for the principal in the business of the agency, and he has named another person accordingly. In the circumstances, such a named person is not a sub-agent he is an

agent of the principal for such part of the business of the agency as has been entrusted to him.(c.) Special Agents:A special agent is also known as a specific or particular agent. Such agent appointed to perform a particular work or to represents his principal in particular transaction only. As soon as the said period lapses, the agency stands terminated. Specific agents have a limited authority and as soon as the entrusted to him is performed, his authority also comes to an end. A special agent cannot bind his principal in any act other than for which he is specially appointed. If he dose anything outside his authority, his principal cannot be bound by it. The third parties that deal with a special agent must ascertain the extent of the authority he has.(d.) General agents: This type of agents has a general authority to do everything in the course of his agency and he has to perform all the acts in the interest of his principal. Thus, a general agent is one that ahs authority to do all acts connected with the business of his principal. A manager of a branch shop of a firm or a commission agent is instances of general agents. General agents have an implied authority to bind his principal by doing various acts necessary for carrying on the business of his principal. Sufficiently wide powers are vested in him to affect the business deals, enter into trade bargains, to make purchases and also payments of the purchases, to receive money on behalf of his principal.(e.) Universal Agent: A universal agent has a universal or an unlimited power to act on behalf of his principal. A universal agent is one whose authority is unlimited and who can do any act on behalf of his principal provide such act is legal and is agreeable to the law of land. A universal agent is practically substituted for his principal for all those transactions wherein his principal cannot participate.(f.) Co-Agents:When a principal appoints two or more persons a agents jointly or severally, such agents are known as co-agents. Their authority is joint when nothing is mentioned about the exercise of their authority. It implies that all co-agents concur in the exercise of their authority unless their authority is fixed. But when their authority is several, any one of the co-agents can act without the concurrence of other.(f.) Auctioneers: An auctioneers is a mercantile agent who is appointed to sell goods on behalf of the principal i.e., seller and for this function, an auctioneer get a reward in the form of a commission. An auctioneer conducts auction on behalf of a seller, as he is primarily the agent of the seller. However, after the sale, he also becomes of the purchaser who gives the highest bid. An auctioneer has no authority to self-the goods of his principal by private contract or contracts.Besides the above mentioned agents, there are other types of agents also such as brokers, bankers, clearing agents, forwarding agents, underwriter, estate agents, etc. They also play an important role and perform various functions for and on behalf of their principals.

Unit V Support to Entrepreneurs: Government Policy for Small Scale Enterprises - Growth Strategies in small industry - Expansion, Diversification, Joint Venture, Merger and Sub Contracting.

SUPPORT TO ENTREPRENEUR

The importance of entrepreneurs and small businesses has been a central theme in discussions of the national recovery. On the local level, city leaders understand first-hand the importance of entrepreneurs and small businesses. Entrepreneurs and small businesses:

Create new jobs and employ local residents;

Play a pivotal role in creating a unique sense of place that enhances a community's quality of life; and

In a more footloose, global economy, homegrown businesses may have deeper roots than those gained through attraction strategies.

How can local governments support entrepreneurship and small businesses?

To encourage entrepreneurs, local governments need to examine how they can contribute to an entrepreneurial eco system by tackling efforts within city hall and partnering and connecting with external stakeholders. This tool kit is divided into four sections outlining activities for city leaders.

Entrepreneurship and self-employment help:

create jobs

develop skills

give unemployed and disadvantaged people an opportunity to fully participate in society and the economy.

GOVERNMENT POLICY FOR SMALL-SCALE ENTERPRISESIndia's concern and support for small-scale enterprises has focused excessively on the small-scale industry. This can, perhaps, be traced back to Mahatma Gandhi's special concern for handicrafts and village-based industries. Various measures taken by the Central and State governments, for the development of the SSI have included product reservations, fiscal concessions, preferential allocation of credit and interest subsidy in a credit-rationing framework, extension of business and technical services, preference in government procurement, marketing assistance including export promotion by institutions such as National Small Industries Corporation, Small Industries Development Organisation, Handicrafts and Handloom Promotion Corporation, and Khadi and Village Industries Commission, as also promotion of ancillarisation, and so on.

Administratively, India's SSI sector is divided into seven industry groups. Traditional Sector Modern Sector

1. Handicrafts 6. Powerlooms

2. Handlooms 7. Residual small-scale industries

3. Khadi, village and cottage industries  

4. Coir  

5. Sericulture  

 The first five sectors are collectively called the traditional sector and the last two are

known as the modern sector. The eligibility of SSI firms to take advantage of the various incentives offered depends on the definition of SSI used. Whereas most countries define SSEs in terms of employment levels, the Indian definition has been based largely on the cumulative amount of investment in plant and machinery.

Policies for Small Enterprise

In order to protect, support and promote small enterprises as also to help them become self-supporting, a number of protective and promotional measures have been undertaken by the Government. The promotional measures cover:

 - industrial extension services - institutional support in respect of credit facilities, - provision of developed sites for construction of sheds, - provision of training facilities,

 - supply of machinery on hire-purchase terms, - assistance for domestic marketing as well as exports, - special incentive for setting up enterprises in backward areas etc. - technical consultancy & financial assistance for technological upgradation.

While most of the institutional support services and some incentives are provided by the Central Government, others are offered by the state governments.

Small Scale Industries in the 1977 Policy

The main thrust of the new (1977) Industrial Policy was on effective promotion of cottage and small industries widely dispersed in rural areas and small towns. It became the policy of the Government that whatever can be produced by small and cottage industries must only be so produced. The list of industries reserved exclusively for the small scale sector was significantly expanded to include more than 500 items as compared to about 180 items earlier.

Tiny Sector

Within the small scale sector, the 1977 policy introduced special attention to be given to units in the tiny sector, namely those with investment in machinery and equipment upto Rs One lakh and situated in towns with a population of less than 50,000 according to 1971 census figures, and villages. Schemes would be drawn up for margin money assistance especially to tiny units as well as to cottage and household industries.

District Industries Centres

In the past, there has been a tendency to proliferate schemes, agencies and organisations which have tended to confuse the entrepreneur. To remedy this, the 1977 policy proposed that, in each district, there would be a District Industries Centre. The DIC would take up economic investigation of the district’s raw materials and other resources, supply of machinery and equipment provision or raw material, arrangements, for credit facilities, and effective set-up for marketing and a cell for quality control, research and extension. The DIC would link closely with the Development Blocks and with Small Industries Service Institutes.

Effective Financial Support 

In order to provide effective financial support for promotion of small village and cottage industries, the Industrial Development Bank of India has taken steps to set up a separate wing [Later named SIDBI] to deal exclusively with the credit requirements of this sector. It will coordinate, guide and monitor the entire range of credit facilities offered by other institutions for the small and cottage sector, for whom separate wings will be set up in nationalized banks. Banks will also be expected to earmark a specified proportion of their total advances for promotion of small, village and cottage industries.

Government Policy Towards Small Business: Need for a National Policy

(i) Small scale industries operate the local or State level. Different State Governments an local bodies have framed their own regulations and it is necessary to coordinate and supplement their efforts for the development

of small scale units. 

(ii) Full employment is a fundamental goal of economic planning in India. Small scale industries offer large employment potential as they use labour-intensive methods of production. 

(iii) A major cause of our under development is the underutilization of resources. In order to tap the local and latent resources and skills, national policy of the growth of the Decentralized sector is necessary. 

(iv) Development of small business at the national level helps to achieve a balanced development of various regions, in particular the backward regions of the country. Small scale industries are an important means of rural development.

(v) Small scale industries face several managerial, technical and financial problems, and there is need to develop institutional an other facilities for them. A national policy is required to create coordination between small scale and large scale sectors.

(vi) A national policy on small scale industries is helpful in the creation of a socialistic pattern of society. Small Scale industries help in raising national income an standard of living in rural areas They help to preserve skills an handicrafts. Small scale units are useful for reducing concentration of economic power, monopolies and exploitation in the country.

GROWTH STRATEGY

Strategy aimed at winning larger market share, even at the expense of short-term earnings. Four broad growth strategies are diversification, product development, market penetration, and market development.

THREE STRATEGIES FOR ACHIEVING AND SUSTAINING GROWTH  

Far too many companies fail to achieve their growth targets in revenue and profitability. However, the probability of achieving profitable growth is heightened whenever an organization has a clear growth strategy and strong execution infrastructure. One without the other impairs the probability of success. This author describes why and prescribes strategies.

Many organizations fail to achieve their desired growth targets in revenue and profitability.

Most businesses fall short of achieving their growth objectives for revenue and profitability. In fact, studies report success rates as low as 20%. Why is growth so elusive?

Based on our research and experience*, there are two major reasons:

Inadequate consideration of opportunities within the core business, adjacent to the core business or within new customer sub-segments.

An organizational infrastructure that cannot support successful execution.

However, managers can do certain things to improve the chances for success. This article will describe one such thing managers can do, namely build a systematic framework composed of three strategies for growth and three key elements for successful execution. The article will also explain how the three strategies and three key elements increase the probability for success.

* This article is an amalgam of extensive experience and research undertaken by the author and his colleagues, David Day and Dr. Donald Baer, on creating and implementing growth strategies, mostly with mid-sized firms.

ACHIEVING GROWTH: RECOMMENDATIONS FOR INCREASING THE PROBABILITY OF SUCCESS1. Strengthen the execution infrastructure by investing in ‘safe bets’.

Regardless of which growth strategy is selected, a firm’s infrastructure must be up to a standard that supports successful execution. An on-going commitment to creating such an infrastructure is a ‘safe bet’. Achieving this requires (1) eliminating departmental or regional silos, (2) utilizing leading indicators and performance drivers that align with the strategy and (3) growing leaders at all levels – managerial and non-managerial.

2. Initiate a process to identify strategies with a high probability for success.

Three customer growth strategies are presented below: (1) Growing the core business, (2) Growing by sub-segmenting customers and (3) Growing adjacent opportunities. It is recommended that the senior leaders begin the process by considering the growth potential within the present core business and/or the opportunities and growth potential associated with creating innovative value propositions for underserved customer groups. As the senior leadership group moves through this process, it will become clear if and when adjacent growth options should be considered.

CUSTOMER-FOCUSED GROWTH STRATEGIES1. The process of identifying profitable growth opportunities most often begins with the Core Business1, that is, the products, services, customers, channels and geographic areas that generate the largest proportion of revenue and profits. In-depth conversations with the senior leaders on the topic, “What is our core business?”, is the preferred starting point.

An evaluation of the overall performance of the core business follows. This involves measuring and benchmarking profitability, rate of revenue growth and the firm’s reputation with its most important customers.Such an assessment will raise a number of questions. For example:

o In what direction is each of these key indicators headed and why?o Who are and who are not the core customers? Why?o What is the firm’s key competitive market differentiator? How can it be strengthened?o Is the core business under major threat?o Are there attractive growth opportunities within the core?

When considering these questions, input from external stakeholder groups is very helpful, particularly from loyal and even not-so-loyal customers.The overall process need not take a great deal of time, but can yield significant returns. These include:

o A renewed commitment to operational excellence within the core business,o Insightful conversations on the growth potential of the core business, or conversely,o An urgent need to make significant changes to the core or even a plan for abandoning

the present core and exploring more profitable growth options.

Acklands-Grainger Inc., a leading Canadian industrial supply company, initiated such a process.Prior to doing so, Acklands-Grainger was described as a “stodgy Canadian supply company…complacent” and one with a 4% growth rate. “In less than 12 months” it had been transformed “to an exciting place to work with (close to) a 20% growth rate and higher profitability”.2 How did such a dramatic change occur?

The starting point was winning the commitment of key employees at all levels, individuals who were willing to step forward and lead.

Processes were created to help refocus on the core business. Key elements included (1) defining three market platforms on which the core business is based – Industrial, Fleet and Safety, (2) eliminating products and markets that did not fit on these platforms, (3) adding

new products to augment the core and (4) strengthening market coverage with significant investments in the two major channels – sales depots and the firm’s website.2. A second customer-focused growth strategy is based on the firm’s existing customers. This strategy involves creating High Impact Value Propositions for new customer sub-segments. Underpinning this strategy is the willingness to view customers through a different set of lenses.

A process can be created to assist both managers and specialists at the customer interface gain fresh insights into customer needs and preferences. This is a necessary first step in discovering underserved customer groups and hidden growth opportunities. (Senior leaders who frequently interact with customers can make a significant contribution to this process.)Key elements of this process include (1) sub-segmenting existing customer groups based on newly discovered needs, buying patterns and contribution to profits and/or revenue, (2) creating innovative and high-impact value propositions for the most attractive sub-segments, (3) field-testing the new value propositions and (4) scaling-up based on the results of field tests.3

In addition, some firms choose to focus on lower end customer sub-segments. These are usually groups of customers for which the cost of supplying and servicing exceeds the revenue the customer generates. In such cases, value propositions can be designed which will move the customer to a profitable position or at least minimize the losses. For example, direct sales calls can be replaced with on-line ordering systems and non-essential product/service features can be eliminated. These actions not only lower the costs of serving customers but often also lower the customer’s cost. After the initial shock, many customers welcome the new lower-value proposition.

Leading Canadian financial organizations have successfully applied this overall approach to sub-segmentation. But so have mid-sized and small firms, e.g. The International Group Inc., a Toronto-based petroleum specialties manufacturer and third-generation family business. Also, think of your favorite owner-managed restaurant, the one you select for meetings with important clients or special family occasions. Such businesses often owe their success to delivering attractive value propositions to different customer sub-segments.3. A third customer-focused strategy is to enter businesses that have strong strategic links to the core – adjacent businesses1. This is a particularly appealing alternative when the core business is approaching its full potential, operates efficiently and generates surplus cash for reinvestment. It is also an important option when it is clear that the core’s future growth potential is weak.

Many leaders prefer to start this process by focusing on current customers. A series of meetings with the most innovative customers can be a valuable source of opportunities. Alternative channels, new products or services or even new joint ventures may be suggested as well as entering new geographic markets, serving different customer segments and redesigning the customer’s value chain.

Another alternative is to consider the non-core businesses of the firm. Is there the potential to leverage present positions into attractive growth opportunities?

When considering adjacent growth alternatives, the relationship to the core business requires special consideration – specifically an assessment of the major strategic differences and similarities with the core. Too many differences can overly tax the organization’s capabilities. To minimize this risk, business leaders may wish to test their organization’s capacity by piloting adjacent growth initiatives in stages, one or two degrees of strategic difference at a time.

Some leaders choose to look at adjacent growth options in an opportunistic manner – as one-offs. This often results in disappointment. Initial successes with one or two close customers can soon fade under the onslaught of strong established competitors. To prevent this, leaders are advised to “organize to suit the new business as much as the core”.4

Tim Hortons presents an interesting example of an adjacent growth strategy.

After a series of market tests, this prominent Canadian organization identified regions in the U.S. north east and mid west in which there is potential for profitable growth. Based on these tests, the firm is selectively investing in establishing a position in these highly competitive markets.Contrast entering new geographic markets with the alternative adjacent growth strategy of creating a new product platform in the core Canadian market – specifically, soup and sandwich lunches and more recently the very popular breakfast sandwiches. These new product initiatives have significantly increased revenue (and profits) within existing stores.5

In the short term, adjacent growth initiatives that leverage a strong position with existing core customers have a higher probability of success. The alternative of expanding into new geographic markets provides the advantage of building a larger customer base, but often at the cost of a longer payback period and higher risk.EXECUTING GROWTH STRATEGIESThe three Customer-Focused Growth Strategies described above require a supporting infrastructure to increase the chances of successful implementation. Lack of an adequate infrastructure is the second reason cited for not achieving growth objectives.

A supportive infrastructure includes (1) organization capabilities that are valued by customers, (2) a management-performance system and scorecard which focuses on leading indicators and the drivers of growth and (3) strong leadership practices at every level of the organization.1. Organization capabilities are processes that are strategic and deliver a high level of value to customers. For example, a firm may have the capability to:

o Successfully entering new markets,o Create excellent new products or services which appeal to customers, oro Provide an outstanding level of customer service.

Note that the three organization capabilities selected are vital to the success of specific Customer-Focused Growth Strategies.

Each of these capabilities is rooted in processes that move across the organization and require the expertise and commitment of various individuals and departments.

It’s widely accepted that an organization’s success is rooted in its competitive-edge, organizational capabilities. Therefore, a major challenge that senior managers face is to clarify, assess and continually strengthen their organization’s strategic capabilities.An important aspect of the clarifying and assessing process requires that senior managers step outside their organization and evaluate both their firm and their competitors’ through the eyes, mind and heart of the customer. The following guidelines will help with such an assessment. The capability should be:

1. Highly visible to key individuals within the customer organization, and acknowledged as providing exceptional value.

2. Difficult for present and potential competitors to replicate.

As an example, let’s examine the capability to provide an outstanding level of customer service in a manner that would make it difficult for competitors to replicate. In order to provide such a high level of customer service, employees from different departments (not only the Customer Service Department) must be involved in service delivery. Employees throughout the organization should connect quickly and collaborate willingly. Collectively, relevant information and insights about customers and product or service delivery must be shared.

The high level of cross-departmental collaboration required can prove challenging for some organizations, particularly those with rigid vertical structures. Such structures make it difficult for employees to adapt and respond to special customer service requirements. Note that under these conditions, an employee’s loyalty often shifts from the firm to their department or profession.

Delivering a superior level of customer value requires uninterrupted flow across the organization. Eliminating barriers to flow – breaking down departmental silos- is a necessary first step to building an organization’s strategic capabilities, regardless of the specific capability.Let’s return to the question of how difficult will it be for a competitor to replicate a key organizational capability. It should be very difficult! A number of senior leaders view organization capabilities as the key element of their business strategy. These leaders focus on continually building and leveraging the organizations’ capabilities to drive new business growth.6

2. A second key element of infrastructure necessary for successful execution is the Performance Management system and scorecard. (Note: Performance Management systems are rooted in the widely held belief that “what gets measured gets done”.)

The process starts by answering the question, what should be measured and why?The following guidelines help answer this question.

o Scorecards depict key strategic relationships, particularly between the desired performance outcomes such as revenue and profit growth and the drivers of performance (e.g. new market entry, service quality, customer loyalty, employee engagement).

o Performance of both individuals and departments (or regions) is directly linked to the growth strategy and successful execution.

o Company scorecards should provide a balanced perspective based on the needs of key stakeholders groups and/or major organizational processes – internal operations, value provided to customers and employee development.

Let’s assume that the overall strategy of a firm is to grow the core business and that growth will be achieved through increased market penetration of existing products. What are the drivers of growth that must be measured, monitored and managed?

This question is best answered by those directly involved. Precise measurements are not always possible but proxy indicators established in a thoughtful and open manner are. Let’s assume that increased market penetration will be driven by the strength of the company’s brand and customer loyalty. But what drives customer loyalty and brand strength? Is it the quality of service provided, the reputation of the sales staff or the depth of knowledge of the customers’ business and requirements?

When there is a reasonable level of confidence that the above questions have been answered, the process shifts to (1) how and when will performance be measured, (2) how will those directly responsible access the performance measurement and (3) what follow-up action, if any, is necessary?

Performance management systems based on the processes described are becoming more evident in successful organizations. A brief description of the approach RBC Banking uses follows.

Leaders in the Banking Group have utilized performance scorecards to link execution with overall business strategy for a number of years. The scorecard has been aligned with four major stakeholder groups – customers, employees, shareholders and the communities in which the bank resides.The focus is on measuring and monitoring leading indicators – for example, the drivers of customer loyalty, employee engagement and financial results. Considerable input from many sources is solicited before these measures are set and appropriate action undertaken to continually improve performance.7

3. The third key ingredient of a supportive infrastructure is Leadership.Who are leaders and what do they do? Leaders are people throughout the organization who influence the attitudes and actions of colleagues. As such, they help colleagues understand the many why’s of organizational life. For example:

o Why the organization must perform at a high level in the increasingly competitive and global business environment.

o Why barriers to cross-departmental collaboration are harmful and weaken the organization’s ability to adapt.

o Why, when a colleague’s performance appears to fall short, it may be preferable to view this as an opportunity for learning and professional development rather than expulsion from the organization.

o Why the ultimate success of the organization is rooted in its ability to continually be innovative in delivering value to customers.

Leaders are found at all levels in organizations, including, non-titled, non-managerial positions. They are best identified by their behaviours and influence rather than the hierarchical position. Together, such leaders create a network that reflects the very essence of their organization – ‘who we are, where we’re going and how we’ll get there’.

Such a perspective on leadership significantly differs from the more traditional ‘leader as hero’- the person who fires-up the troops, leads the charge and performs ‘heroic’ feats.

Can leadership skills be developed? The answer is clearly “Yes”. Some organizations owe their success to being able to recognize that the organization is a lab for leadership development. The process of leadership development can start with an assessment of an individual’s emotional intelligence, a key predictive attribute of successful leaders at all levels. Hands-on learning experiences with one-on-one coaching and mentoring are also vital elements of the process.

The relationship between senior leaders and other leaders throughout the organization merits special consideration. Senior leaders ultimately set the overall direction and create conditions that encourage others to join in and lead – particularly with respect to executing the strategy. A condition that has proven effective is the continual reinforcement by senior leaders of the expectation that all employees should exhibit leadership behaviours. With persistence, the growing network of leaders will tip the scales as other members of the organization from every level and in every role join in and commit.

Two organizations, Southwest Airlines and KI (formerly Krueger International), a mid- sized furniture manufacturer, have taken different approaches to the challenge of building leadership at all level and in all roles.

Since its founding, Southwest Airlines has focused on the hiring process. The organization created a unique candidate screening process that has been highly effective in selecting individuals whose values and abilities embody unique and imaginative approaches to dealing with challenges. Such individuals are a good fit with the highly disruptive and innovative low-cost strategy of the airline.

When employees share identical values with the values of the company founder and connect at a very basic level with the organization’s core business strategy, it can be expected that each employee will step forward and lead. Over the last 5 years, Southwest’s sales have grown at an average annual rate of 11 percent. The airline has been profitable for the last 34 years.

In contrast, the president of KI (formerly Krueger International) a Green Bay Wisconsin business furniture manufacturer started the process of expanding the organization’s

leadership mindset and behaviours more that 40 years after the company was founded. The president’s approach was based on the belief that (1) teaching employees how to think like a business person and (2) providing all employees access to whatever information is required is an absolute necessity. These beliefs have been continuously demonstrated at well-attended regular scheduled monthly meeting organized by the president. Employees at all levels and in every role receive performance-related information from the president and discuss how to solve problems and capitalize on opportunities. (Note: As a result of the diligent efforts of the president, all employees are company owners.)

The company’s growth strategy has drawn on the approaches described in this article – redefining and growing the core (expanding the product line), entering adjacent businesses (European expansion) and focusing on new market segments and sub-segments (universities, leading high tech firms). During the president’s tenure, sales increased from $45 Million to $630 million, an annual growth rate of 14%. The annual growth in ROI exceeded 30%.

In summation, we can say that the probability of achieving profitable growth is heightened whenever an organization has a clear growth strategy and strong execution infrastructure. One without the other impairs the probability of success.

EXPANSIONThe Case for Growth: Gaining a Business Advantage from Expansion

1. Build a Family Dynasty and Grow Community Self-Sufficiency.

Family pride, job relevance for family members, and building a business dynasty for not just your family, but for other families in your community as well, are a great reason for growth. Growth of a business, especially in a small community, can be seen as community economic development.

2. Build business value by dominating a market niche.

Business growth may garner your business the advantage it needs to be a leader in a market niche. You can move into new geographic markets, acquire more customers or provide the next level of service to your present customers - perhaps, a service they have been asking you for. Growing your brand brings value to your business and quality to your customers. Both are important in creating goodwill in the marketplace.

3. Attract and Retain Good Employees.

Employees are the new "green" in business, and the excitement of growth offers the potential for career challenge that inspire skilled employees. Growing businesses offer change and the need to acquire new knowledge - both something that younger employees seek and the global economy demands.

4. Land the major clients that in turn lead to more financial support from lenders.

Landing a major client or contract can give your business the cachet that it needs to get others to follow. As you build your resume financiers will take you more seriously, though they may consider you more risk too. Your larger size will increase your marketplace presence and strength.

5. Achieve economies of scale.

The age old concept in business is economies of scale. This means that bigger businesses achieve lower costs per unit and stretch administration dollars over a larger product line: marketing, professional fees, insurance and banking charges, to name a few. This economy of scale contributes to having more money for R&D, sponsorhips, employee training and education, investment in new technology and creating more productivity out of employees.

Seven Ways to Expand: From Local to Global

1. Increase your sales and products in existing markets. This is obviously the easiest and most risk-free way to expand. This tactic may require a bigger location, different pricing strategies, new/improved marketing techniques - but it will be in a customer group with whom you already have a relationship. If you get off track, your present customers will let you know!

2. Introduce a New Product. You have a successful product/service that you have been offering for some time and have been collecting data, customer feedback and doing the tinkering on your newest product. This is a normal evolution in business, not just an expansion tactic. When positioned as adding value and being responsive to customer needs, this can be a relatively risk-free way to expand.

10 Rules of Exporting

Identify the specific market niche you intend to target. Be honest. Be professional. Be diligent. Be prompt. Be respectful of cultural differences. Plan for long lead times. Be patient. Maintain your sense of humor.

Partner early in the process.Types of Financing You May Need for Expanding and/or Exporting

Export Canada's Expoert Check Service Increased Line of Credit Accounts Receivable Insurance Political Risk Insurance Bank Guarantee Insurance Medium- to Long-Term Buyer Financing Contract Bond Insurance Additional Equity Investments or Loans

3. Develop a New Market Segment or Move into New Geography. Both of these areas require cost outlays and uncertainty. Moving your products into new categories or demographic segments requires market research, beta testing and new marketing strategies, i.e. a message for a 16-year old will differ that one for a 60-year old. Management of new remote locations may absorb significant time and attention. While the risks are more, the payoffs are large - and for most businesses looking to expand, these two methods of expansion are inevitable.

4. Start a Chain. A restaurant, retail or service business that's easily reproduced and can be run from a distance is all you need to launch a chain. But, you must be cognizant of what made the first location a success - was it location, your staff or you? If it is just you, then duplication is only possible through detailed operations plans and sharing staff between locations. You will need to duplicate the plan of your first location while meeting increased customer demands. Starting a chain gives your current staff a crack at "management" duties, training opportunities and an opportunity to expand their horizons.

5. Franchise or License. While it's a quick way to grow, a franchise agreement can cost (minimally) $100,000 to prepare. You will need to be a good teacher, be able to prepare the training manuals (preferably in more than one language), be very organized and willing to travel. Licensing can carry less risk, but demands giving up a certain amount of control. Licensing a patent, trademark or industrial design means that you sell manufacturing, distribution or production rights.

6. Join Forces / Strategic Alliance. A merger or acquisition combines the best of two companies, expands your customer base, increases intellectual capital and delivers operational efficiencies. The trick is finding the right partner. These partners may be new distributors, but be forewarned large retailers exact heavy performance expectations. Can you perform to the letter of your promise? Can you meet high standards of quality (ISO, or the like) and adapt your procedures to meet just-in-time delivery? Due diligence and strong contractual arrangements are essential here.

7. Go Global. You can decide to go global in a number of ways. Growing markets, rising consumer spending, improved business climate--sometimes the only place to find these things is overseas. Doing business internationally can take the form of exporting, licensing, a joint venture or manufacturing, but whatever form you choose, the basic business rules apply:

assess customer demand, gain legal and accounting assistance, protect intellectual property and obey regulations.

More difficult to understand than the regular business affairs may be the cultural nuances - ignore them at your peril. In some countries, particularly those in Asia, a local partner is virtually a requirement. Your first stop should be your target country's economic development agency, which can help marshal local resources to get you on your way, possibly with a small financial boost. Be patient. Growing your business globally can take more than one "sightseeing trip" to the region. Here are some steps in going global, from easiest to hardest.

Four Ways to Go Global:

1. You can fill orders from Canadian buyers who then export your product. This is the lowest risk of all, but does not put you in the driver's seat. You will have to rely on others to spot the opportunities and take a passive role in the research and negotiations.

2. You can find foreign buyers operating in Canada. Multinational corporations, foreign government and international retailers can buy goods from you in Canada to export to their particular market. There aremany on-line websites on which you can list your product or service, and increase the chances of your selection as a company of choice.

3. You can work through agents and distributors. By working through export management, sales agents or trading houses you can access foreign markets while still being involved in control of the sales and terms. These intermediaries will build your export expertise and be able to provide information about new trends or market shifts.

4. Marketing and delivering your product directly. This option calls for a large commitment in resources, resolve and business savvy. The best way to begin is to join forces with non-competitor businesses and "package" your offerings. Together you can share advice from government trade representatives, financial institutions, freight forwarders, distribution networks, agents and even shipping space. Perhaps also, look for the cultural bridge in your partnership - do they speak the language or have they lived in the country? Whether you go it alone, or partner, going global has risks - and the ultimate reward.

Diversification (marketing strategy)

Diversification is a corporate strategy to enter into a new market or industry which the business is not currently in, whilst also creating a new product for that new market. This is most risky section of the Ansoff's matrix, as the business has no experience in the new market and does not know if the product is going to be successful.

Diversification is part of the four main growth strategies defined by Igor Ansoff's Product/Market matrix:

A portfolio strategy designed to reduce exposure to risk by combining a variety of investments, such as stocks, bonds, and real estate, which are unlikely to all move in the same direction. The goal of diversification is to reduce the risk in a portfolio. Volatility is

limited by the fact that not all asset classes or industries or individual companies move up and down invalue at the same time or at the same rate. Diversification reduces both the upside and downside potential and allows for more consistent performance under a wide range of economic conditions.

Ansoff pointed out that a diversification strategy stands apart from the other three strategies. The first three strategies are usually pursued with the same technical, financial, and merchandising resources used for the original product line, whereas diversification usually requires a company to acquire new skills, new techniques and new facilities.

Note: The notion of diversification depends on the subjective interpretation of “new” market and “new” product, which should reflect the perceptions of customers rather than managers. Indeed, products tend to create or stimulate new markets; new markets promote product innovation.

Product diversification involves addition of new products to existing products either being manufactured or being marketed. Expansion of the existing product line with related products is one such method adopted by many businesses. Adding tooth brushes to tooth paste or tooth powders or mouthwash under the same brand or under different brands aimed at different segments is one way of diversification. These are either brand extensions or product extensions to increase the volume of sales and the number of customers.

The strategies of diversification can include internal development of new products or markets, acquisition of a firm, alliance with a complementary company, licensing of new technologies, and distributing or importing a products line manufactured by another firm. Generally, the final strategy involves a combination of these options. This combination is determined in function of available opportunities and consistency with the objectives and the resources of the company.

There are three types of diversification: concentric, horizontal, and conglomerate.

Concentric diversification

This means that there is a technological similarity between the industries, which means that the firm is able to leverage its technical know-how to gain some advantage. For example, a company that manufactures industrial adhesives might decide to diversify into adhesives to be sold via retailers. The technology would be the same but the marketing effort would need to change.

It also seems to increase its market share to launch a new product that helps the particular company to earn profit. For instance, the addition of tomato ketchup and sauce to the existing "Maggi" brand processed items of Food Specialities Ltd. is an example of technological-related concentric diversification.

The company could seek new products that have technological or marketing synergies with  existing product lines appealing to a new group of customers.This also helps the company to tap that part of the market which remains untapped, and which presents an opportunity to earn profit..

Horizontal diversification

The company adds new products or services that are often technologically or commercially unrelated to current products but that may appeal to current customers. This strategy tends to increase the firm's dependence on certain market segments. For example, a company that was making notebooks earlier may also enter the pen market with its new product.

Conglomerate diversification (or lateral diversification)

The company markets new products or services that have no technological or commercial synergies with current products but that may appeal to new groups of customers. The conglomerate diversification has very little relationship with the firm's current business. Therefore, the main reasons for adopting such a strategy are first to improve the profitability and the flexibility of the company, and second to get a better reception in capital markets as the company gets bigger. Though this strategy is very risky, it could also, if successful, provide increased growth and profitability.

JOINT VENTUREA joint venture (JV) is a business agreement in which the parties agree to develop, for a finite time, a new entity and new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets. There are other types of companies such as JV limited by guarantee, joint ventures limited by guarantee with partners holding shares.

With individuals, when two or more persons come together to form a temporary partnership for the purpose of carrying out a particular project, such partnership can also be called a joint venture where the parties are "co-venturers". A joint venture is a business enterprise undertaken by two or more persons or organizations to share the expense and (hopefully) profit of a particular business project. A joint venture is not a business organization in the sense of a proprietorship, partnership, or corporation. It is an agreement between parties for a particular purpose and usually a defined timeframe. Joint ventures may be very informal, such as a handshake and an agreement for two firms to share a booth at a trade show. Other arrangements may be extremely complex, such as a consortium of major electronics firms joining to develop new microchips. The key factor in a joint venture partnership is its single, definable objective. Joint ventures have grown in popularity in recent years, despite the relatively high failure rate of such efforts for one reason or another. Creative small business owners have been able to use this business strategy to good advantage over the years, although the practice remains one primarily associated with larger corporations.

Most joint ventures are formed for the ultimate purpose of saving money. This is as true of small neighborhood stores that agree to advertise jointly in the weekly paper as it is of

international oil companies that agree to work together for purposes of oil and gas exploration or extraction. Joint ventures are attractive because they enable companies to share both risks and costs.

A joint venture is a business enterprise undertaken by two or more persons or organizations to share the expense and (hopefully) profit of a particular business project. A joint venture is not a business organization in the sense of a proprietorship, partnership, or corporation. It is an agreement between parties for a particular purpose and usually a defined timeframe. Joint ventures may be very informal, such as a handshake and an agreement for two firms to share a booth at a trade show. Other arrangements may be extremely complex, such as a consortium of major electronics firms joining to develop new microchips. The key factor in a joint venture partnership is its single, definable objective. Joint ventures have grown in popularity in recent years, despite the relatively high failure rate of such efforts for one reason or another. Creative small business owners have been able to use this business strategy to good advantage over the years, although the practice remains one primarily associated with larger corporations.

Most joint ventures are formed for the ultimate purpose of saving money. This is as true of small neighborhood stores that agree to advertise jointly in the weekly paper as it is of international oil companies that agree to work together for purposes of oil and gas exploration or extraction. Joint ventures are attractive because they enable companies to share both risks and costs.

The venture can be for one specific project only - when the JV is referred to more correctly as a consortium (as the building of the Channel Tunnel) - or a continuing business relationship. The consortium JV (also known as a cooperative agreement) is formed where one party seeks technological expertise or technical service arrangements, franchise and brand use agreements, management contracts, rental agreements, for one-time contracts. The JV is dissolved when that goal is reached.

A joint venture takes place when two parties come together to take on one project. In a joint venture, both parties are equally invested in the project in terms of money, time, and effort to build on the original concept. While joint ventures are generally small projects, major corporations also use this method in order to diversify. A joint venture can ensure the success of smaller projects for those that are just starting in the business world or for established corporations. Since the cost of starting new projects is generally high, a joint venture allows both parties to share the burden of the project, as well as the resulting profits.

Since money is involved in a joint venture, it is necessary to have a strategic plan in place. In short, both parties must be committed to focusing on the future of the partnership, rather than just the immediate returns. Ultimately, short term and long term successes are both important. In order to achieve this success, honesty, integrity, and communication within the joint venture are necessary.

BENEFITS OF JOINT VENTURES

Among the most significant benefits derived from joint ventures is that parties to the venture save money and reduce their risks through capital and resource sharing. Joint ventures also give smaller companies the chance to work with larger ones to develop, manufacture, and market new products. They also give companies of all sizes the opportunity to increase sales, gain access to wider markets, and enhance technological capabilities through research and development underwritten by more than one party. Until relatively recently, U.S. companies were often reluctant to engage in research and development partnerships, and government agencies tried not to become involved in business development. However, with the emergence of countries that feature technologically advanced industries (such as electronics or computer microchips) supported extensively by government funding, American companies have become more willing to participate in joint ventures in these areas. In addition, both federal and state agencies have become more generous with their financial support in these areas. Government's increased involvement in the private business environment has created more opportunities for companies to engage in domestic and international joint ventures.

MERGER

The combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock. Mergers and acquisitions (abbreviated M&A) are both aspects of strategic management, corporate finance and managementdealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or new location, without creating a subsidiary, other child entity or using a joint venture. Mergers and acquisitions activity can be defined as a type of restructuring in that they result in some entity reorganization with the aim to provide growth or positive value. Consolidation of an industry or sector occurs when widespread M&A activity concentrates the resources of many small companies into a few larger ones, such as occurred with the automotive industry between 1910 and 1940.

The distinction between a "merger" and an "acquisition" has become increasingly blurred in various respects (particularly in terms of the ultimate economic outcome), although it has not completely disappeared in all situations. From a legal point of view, amerger is a legal consolidation of two companies into one entity, whereas an acquisition occurs when one company takes over another and completely establishes itself as the new owner (in which case the target company still exists as an independent legal entity controlled by the acquirer). merger,  corporate combination of two or more independent business corporations into a single enterprise, usually the absorption of one or more firms by a dominant one. A merger may be accomplished by one firm purchasing the other’s assets with cash or its securities or by purchasing the other’s shares or stock or by issuing its stock to the other firm’s stockholders in exchange for their shares in the acquired firm (thus acquiring the other company’s assets and liabilities).

Mergers are of several different types: horizontal, if both firms produce the same commodity or service for the same market; market-extensional, if the merged firms produce the same commodity or service for different markets; or vertical, if a firm acquires either a supplier or a customer. If the merged business is not related to that of the acquiring firm, the new corporation is called a conglomerate.The reasons for mergers are various. The acquiring firm may seek to eliminate a competitor; to increase its efficiency; to diversify its products, services, and markets; or to reduce its taxes. Merger activity varies with the business cycle, being higher when business is good.

Strategic mergers

A Strategic merger usually refers to long term strategic holding of target (Acquired) firm. This type of M&A process aims at creating synergies in the long run by increased market share, broad customer base, and corporate strength of business. A strategic acquirer may also be willing to pay a premium offer to target firm in the outlook of the synergy value created after M&A process.

SUBCONTRACTING

A business practice where main contractor hires additional individuals or companies called subcontractors to help complete a project. The main contractor is still in charge and must oversee hires to ensure project is executed and completed as specified in contract.

The practice of assigning part of the obligations and tasks under a contract to another party known as a subcontractor. Subcontracting is especially prevalent in areas where complex projects are the norm, such as construction and information technology. Subcontractors are hired by the project's general contractor, who continues to have overall responsibility for project completion and execution within its stipulated parameters and deadlines.

Subcontracting refers to the process of entering a contractual agreement with an outside

person or company to perform a certain amount of work. The out-side person or company in

this arrangement is known as a subcontractor, but may also be called a free-lance employee,

independent contractor, or vendor. Many small businesses hire subcontractors to assist with a

wide variety of functions. For example, a small business might use an outside firm to prepare

its payroll, an accountant to help with its record keeping and tax compliance, or a free-lance

worker to handle a special project. Subcontracting is probably most prevalent in the

construction industry, where builders often subcontract plumbing, electrical work, drywall,

painting, and other tasks.

Hiring subcontractors offers a number of advantages for small businesses. For example,

subcontracting mundane but necessary tasks can free up time and resources to enable the

small business owner to concentrate on making money and growing the business. In addition,

hiring a subcontractor is usually less expensive than hiring a full-time employee, because the

small business is not required to pay Social Security taxes, workers' compensation benefits,

or health insurance for independent contractors. Subcontracting does pose some potential

pitfalls, however, such as a loss of control over the quality and timeliness of work. But small

business owners can take several steps to help ensure that their relationships with

subcontractors are productive and beneficial for all concerned.

Subcontracting is a type of job contract that seeks to outsource certain types of work to other companies. This is a step down from general contracting, which is a contract overseeing a much broader project in many cases. It's typically done when the general contractor does not have the time or skills to perform certain tasks.When a building is being constructed, subcontracting becomes a major deal. A general contractor may take care of a number of tasks, including the brick-and-mortar construction, but look to others for specialized tasks, especially things like plumbing and electrical work. These disciplines are nearly always subcontracted out.

Larger contractors may be able to handle the plumbing and electrical work as well, but this is rare, not only because of the expertise involved, but the desire to focus primarily in one area. If a contractor has too many disciplines, the thought may be that it is not clearly focusing its efforts on quality in any particular area.

In some cases, a general contractor may only be used as the construction manager or supervisor. In that case, subcontracting accounts for all of the physical work done on the premises. The general contractor's only responsibility is to approve the contacts, keep the project within budget, and inspect the work.

***THE END***