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8/11/2019 Enterpreneurs System
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ESTABLISHING
ENTREPRENEURS SYSTEM
PRESENTED BY
SHIJO JACOB
ROLL NO -52
SMS,CUSAT
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Before becoming a colony of England India was a major and
most wealthy nation.
Industrial process of India began with handicrafts.
Cast based division of work prevailed.
There were places known worldwide like;
Such as Banaras for metals and sarees ,Ahmedabad for dhoti.
It was then declined due to a number of reasons include;
Disappearance of patronage
The negative thinking of British Government
Withdrawn of support.
Foreign competition
Capital deficiency, etc.
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From 1947 governing focused on attaining self sufficiency
and promoting Indian industries.
Government focused on following objectives;
Balance of economic powers
Decentralisation of industries Dispersion of Entrepreneurial Spirit to all section of
Society.
Emergence of entrepreneurial class in india.
Changing attitude towards entrepreneurship.
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Economic Conditions; It has most direct and immediate
Impact. It comprises of;
Capital; Mostimportant prerequisite, Brings together
labour, land, machine, raw material etc. The good Quality of Labour Force; Two different
perspectives
Labour intensive and capital intensive which has
different impacts. Raw materials; Without which no enterprise can
perform.
Market;competion,size,etc.
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The main components entrepreneurship;
Legitimacy of entrepreneurship; Regarded as the
compliance with the norms and values with in a sociocultural setting.
Joseph Schumpeter recognises the importance of suchlegitimacy in terms of appropriate social climate for
entrepreneurship. Positive legitimacy helps and vice versa
Social Mobility; Social mobility involves the degree ofmobility, both social and geographical, and the nature of
mobility channels with the system. Security; Many advocate that entrepreneurial security if an
important facilitator of entrepreneurial behaviour.
Thinkers like McCelland support moderate certainty.
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Entrepreneurship is moulded by or thrives to achieve
certain psychological factors; Need achievement; David McClellands theory of need
achievement.(the need for achievement , the need for
authority and power , the need for affiliation)
Withdrawal of status respect. It is a complex behaviouraltheory
GOVERNMENT INFLUENCE. Government actions influences in many spears; It can
help or destroy an industry by their industrial policy,
support measures, creation of basic facilities etc.
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Facilitating factors
Technical knowhow Entrepreneurial training
facilities.
Market contacts through Govt.
Family business
Availability of capital from
sources.
Successful role models.
Cheap manpower
Capable advisors and supporters.
Governmental and institutional
help
Barriers to emergence
Lack of technical skills. Lack of proper market
Lack of capital
Lack of business knowledge
Social stigma Time pressure
Legal and bureaucratical
constraints
Political instability
Non-coperative attitude of banksand other support financial
institutions.
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Entrepreneurs are not necessarily born they can be
developed through education, training and experience.
The process;
(i)Enhancing the motivation, knowledge and skills of
potential entrepreneurs.(ii)Arousing and reforming the entrepreneurial
behaviour in their day-to-day activities; and
(iii) Assisting them in developing their own ventures.
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The National Institute for Entrepreneurship and SmallBusiness Development(NIESBUD),Noida.
NIESBUD is an Apex Institute in the area ofEntrepreneurship and Small Business Development underthe Ministry of Micro, Small and Medium EnterprisesGovernment of India. The basic objects for which theInstitute has been established are: Promotion andDevelopment of Micro, Small and Medium Enterprisesincluding Enhancement of their Competitiveness through
Various Activities. The Institute has Conducted a total of7913 Training Programmes covering 2,07,554 Participantswhich includes 163 International Training Programmeswith 2,528 Participants from more than 125 Countries till
31st August, 2013.
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Functions are; Evolving effective training strategies and
methodology Formulating scientific selection procedures Developing training aids, manuals and other
tools Facilitating and supporting agencies engaged in
entrepreneurship development. Conducting programs which not undertaken
NIESBUD also secrateriate for Nationalentrepreneurship
Development Board(NEBD).
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It is an all India institution set by public financial
institutions and the Gujarat Government. Its programme
consisting following steps;
Selecting potential entrepreneurs
Achievement motivation training
Product selection and project report preparation.
Business management training.
Practical training and work experience. Post training support and follow-up.
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National Alliance of Young Entrepreneurs(NAYE).
NAYE has sponsored several schemes of entrepreneurial
development in collaboration with public sector banks.
Some of them are
Bank of India-NAYE. This scheme known as BINEDS
was sponsored in 1972,the beneficiaries were states of
Punjab, Rajasthan, HP,J&K,Chadigarh and Delhi. Union Bank of india-NAYE;This scheme was introduced
in june 1975 in TN.
The main objective of these schemes are to help young
entrepreneurs in identifying investment and self-employment opportunities, securing proper arrangement
for their training, providing necessary financial
assistance on the basis of properly prepared reports,
securing package of consultancy services etc.
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Indian Investment Centre(IIC);It is an autonomous
non-profit organisation financed and supported by the
Government of India. It seeks to promote mutuallyrewarding joint ventures between Indian and foreign
entrepreneurs. It acts as clear house of information to
foreign investors ,who want to make investment in India.
It functions as a link between Indian and foreignindustrialists and assist them in entering into
collaborations.
The IIC has set up Entrepreneurial Guidance
Bureau(EGB)to guide entrepreneurs in identifying
investment opportunities, assisting them in selecting
location, preparing project profiles, arranging financial
assistance, etc.
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Technical Consultancy Organisation(TCOs).
All India financial institutions and state Governments have set
up a network of technical consultancy organisations in India.
The main functions are; Conducting surveys on industrial potential
Preparing project profiles and feasibility studies
Undertaking techno-economic appraisal of projects.
Evaluating projects referred by financial institutions.
Carrying out marketing research.
Providing technical and managerial assistance to
entrepreneurs. Other players are;National Institute of Micro, Small and Medium Enterprises (NIMSME),Hyderabad;(Formerly National Institute of Small Industry Extension Training (NISIET))
National Small Industries Corporation
MSME Development Institutes
Tool Rooms
Central Footwear Training Centres, Agra & Chennai Fragrance and Flavour Development Centre, Kannauj,etc rae other institutions
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Commercial Banks.
Most of the public sector banks are conducting
entrepreneurship development programmes with a view toidentify potential entrepreneurs especially in backward
areas and training and monitoring them.
Assistance in judging the technical and commercial
viability of project proposals.
Assistance in preparing and evaluating project reports.
Practical training in the selected industry.
Assistance in obtaining Government clearance.
Assistance in procuring machinery and equipment.
Assistance in raising the required funds
Assistance and guidance in implementing the
project,etc.
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According to Dr R.A Sharma entrepreneurial performance is a function
of the following factors. (a)Socio-cultural background of the entrepreneur (SB).
This implies the environment in which the entrepreneur was born and
brought up. It conditions the values and attitudes of the entrepreneur.
(b)Motivational Force(MF).It implies the motives which prompt a personto undertake entrepreneurship e.g. Wealth, status, self-employment, etc.
(C) Knowledge and ability of the entrepreneur(KA).It refers to the
education, training, and experience of the entrepreneur.
(d)Financial Strength(FS).It means the funds which an entrepreneur can
mobilise from internal and external sources.
(e)Enviornmental Variables(EV) These consist of Government policies
market conditions, availability of technology and labour situation.
Symbolically
Entrepreneurial Performance (EP)=f(SB,MF,KA,FS and EV)
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(i)Gestation Period. It is the time gap between the date of
incorporation and the date of commencement of commercialproduction.
Reasons cited in delay of projects are Government
approvals, assistance from financial institutions, non-availabilty of
suitable man power, Delayed supply of machinery etc.(ii)Financial Results. Total assets or gross block representing the
physical expansion of an enterprise was used to juudge.Other criterea
was financial heath of units, return on capital employed, net profit over
sales, net profit over net worth etc.(iii) Capasity Utilisation.It depends upon the avilabilty of required
inputs like raw material, power, labour, etc.
(iii)Expansion and diversification.
(iv)Value added by manufacture
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(vi) Growth of offspring Enterprises.
(vii)Others;Salesturn over, size of manpower, volume of exports,
research and development, etc.
Motivational theories on entrepreneurship;(i)Need Achievement Theory(McClelland)
Need for achievement motivation:-McClellandapproach suggests that need for achievement motivation is crucial factor in
determining the level of industrial and economic activities.
McClellands research led him to formulate psychological characteristics of persons
with strong need for achievement. ; David McClellands theory of need
achievement.(the need for achievement , the need for authority and power , the need
for affiliation)
(ii)psycho social theories
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Social change theory by Everett Hagen
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The Central and the State Governments have introduced several schemes for facilitatingfinance to the Women, Minorities and SC/ST/OBCs. Besides specific schemes, the
Government also provides special concessions to them under various other schemes
Schemes for Women
Various government schemes for MSMEs provide certain special incentives and
concessions for women entrepreneurs. For instance, under Prime Ministers RozgarYojana (PMRY), preference is given to women beneficiaries. The government has also
made several relaxations for women to facilitate the participation of women beneficiaries
in this scheme. Similarly, under the MSE Cluster Development Programme by Ministry of
MSME, the contribution from the Ministry of MSME varies between 30-80% of the total
project in case of hard intervention, but in the case of clusters owned and managed by
women entrepreneurs, contribution of the M/o MSME could be upto 90% of the projectcost. Similarly, under the Credit Guarantee Fund Scheme for Micro and Small Enterprises,
the guarantee cover is generally available upto 75% of the loans extended; however the
extent of guarantee cover is 80% for MSEs operated and/ or owned by women. Small
Industries Development Bank of India (SIDBI) has also been implementing special
schemes for women entrepreneurs.
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Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
Promoted by Government of India alongwith SIDBI, provides credit guarantee for collateral
free loans upto Rs. 100 lakh for MSEs under its Credit Guarantee Scheme (CGS) with special
concession to loans extended to women entrepreneurs i.e. the guarantee coverage is provided
upto 80%. As on August 31, 2010, CGTMSE has covered 78,400 guarantees of Rs. 2,571crore run by women entrepreneurs, which constitutes around 20% of total guarantees.
Promotional & Developmental Assistance
Schemes for MinoritiesTo provide additional financing agency for minorities, National Minorities Development &Finance Corporation (NMDFC) was set up by the Government in 1994. The Corporation
promotes the development of backward sections amongst the Minorities through various
schemes. Some of the financial assistance schemes of NMDFC include:
Term loanMargin Money Loan scheme
Educational Loan Scheme
Scheme of Micro Credit
Scheme of Interest Free Loan to NGO
Mahila Samridhi Yojana.
S h f S h d l C t d T ib (SC/ST)
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Schemes for Schedule Castes and Tribes (SC/ST)National SC Finance and Development Corporation (NSFDC) is the apexinstitution for financing, facilitating and mobilising funds from other sourcesand promoting the economic development activities of the personsbelonging to the Scheduled Castes living below double the poverty line.
NSFDC runs various financing programmes for the benefit of the ScheduleCastes. Some of the financing schemes of the corporation are as below:
Term LoanMicro Credit FinanceShilpi Samriddhi Yojana
Mahila Samriddhi YojanaMahila Kisan YojanaSchemes for Other Backward Castes (OBCs)National Backward Classes Finance & Development Corporation (NBCFDC), agovernment undertaking, provides financial assistance through StateChannelising Agencies (SCAs) and Micro Financing through SCAs/ Self Help
Groups (SHGs) to assist a wide range of income generating activities to assistthe poorer section of these classes in skill development and self-employment ventures under sectors like Agriculture and Allied Activities,Small Business, Artisan and Traditional Occupation, Technical andProfessional Trades/Courses, and Transport and Service Sector etc.
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The various financing schemes offered by the corporation are as below:
Term Loans/ margin Money LoansNew Swarnima Special Scheme for WomenEducational Loan Scheme New Akanksha
Swayam Saksham
Micro Finance SchemesMahila Samriddhi Yojana
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