Entrepreneurship Long Answer Type Questions

Question 1.
The different phases of entrepreneurship are as follows:
Answer:
1. Idea Generation: Every new venture begins with an idea. An idea can be a description of a need or problem of some constituency coupled with a concept of a possible solution. The idea can be identified by using input from consumers, business associates, channel members or technical people.

2. Opportunity Evaluation: This is the step where the entrepreneur needs to ask the question of whether there is an opportunity worth investing in. Investment is principally capital, whether from individuals in the company or from outside investors and the time and energy of a set of people. Each idea must be carefully screened and evaluated. It allows the entrepreneur to assess whether the specific product or service has the returns needed compared to the resources required.

3. Planning: Once entrepreneur have decided that an opportunity is feasible. The entrepreneur needs to plan for how to capitalize on that opportunity. A plan begins as a fairly simple set of ideas and then becomes more complex as the business takes shape. In the planning phase entrepreneur needs to create two things: strategy and operating plan.

4. Company formation: Once there is a sufficiently compelling opportunity and a plan, the entrepreneurial team will go through the process of choosing the right form of corporate entity and actually creating the venture as a legal entity.

5. Growth: After launch, the company works toward creating its product or service, generating revenue and moving toward sustainable performance. The emphasis shifts from planning to execution. At this point, you continue to ask questions but spend more of your time carrying out your plans.

Question 2.
Discuss various factors influencing Entrepreneurship.
Answer:
The various factors influencing entrepreneurship are as follows:
1) Economic factors – The economic factors include:

Lack of adequate basic facility.
Non availability of capital.
Non availability of raw materials.
Instability in domestic and foreign policies.
Instability in the market.

2) Social factors – The social factors include:

Customs and tradition.
Rationality of the society.
Social system prevailing in a locality.
Social set up in countries.

3) Cultural factors – The cultural factors include:

Economical motivation.
Attaching value to business talent.
Proper motives.
Encouraging entrepreneurship.
Providing opportunities to women entrepreneur.

4) Personality factors – The personality factors include:

Suspect personality.
Emergence of planning.

5) Political Environments – The political environment includes:

Unstable political conditions.
Government support to economic development.
High taxes that cut into the returns usually discourage entrepreneurs.
The availability of infrastructure.
Economic freedom in the form of favorable legislation.
Safeguard of labor rights.

6) Availability of Resources – The availability of resources includes:

Capital.
Human assets
Raw materials
Infrastructure

Question 3.
Discuss pros and cons or advantages and disadvantages of being an entrepreneur.
Answer:
The advantage and disadvantages of being an entrepreneur are:
Advantages:
1) Bridge the gap between knowledge and application: An entrepreneur is in a position to put his knowledge to practical use. He can bridge the gap between knowledge and application. An entrepreneur can convert his knowledge into an economic activity and gain out of it.

2) Complete Freedom: An entrepreneur is his own boss and has the complete freedom to venture into new business and to take risks.

3) Face competition: An entrepreneur enables the organisation to face competition by producing quality products at a low cost through his innovative ideas.

4) Entrepreneurial ability: People with entrepreneurial ability can make use of various opportunities and have personal gain. They can also make use of resources for improving the standard of society at large.

5) Original ideas: An entrepreneur commands a tremendous amount of respect in the society for his original ideas.

6) Benefit of the society: The creative skill and knowledge of an entrepreneur can be used for the benefit of the society which otherwise would have been a waste.

Disadvantages:
1) Bear risks: An entrepreneur has to bear and assume risks. The reward for risk bearing may be positive or negative.

2) Initial teething problems: Any business has to face the initial teething problems. This delays the process of reaping the benefits of entrepreneurship. Even in the long run, benefits are not extraordinary and the entrepreneurs earn only normal profits. Moreover, there is a constant threat of competition.

3) Time management: Time management is a critical factor for an entrepreneur. As the entrepreneur has invested his own funds, he has to be very cautions about how he utilises his time.

4) Decision making: Decision making is another critical factor. An entrepreneur has to be decisive, he cannot post pone decision making.

5) Inexperience: An entrepreneur needs to have core competence in the accepted line of business. An inexperienced person without entrepreneurial ability cannot manage business.

Question 4.
Explain types of entrepreneurs.
Answer:
The types of entrepreneurs are:
(i) Innovating entrepreneur; Innovating Entrepreneur is a person who habitually creates and innovates to build something of recognized value around perceived opportunities.

(ii) Fabian entrepreneur: A fabian entrepreneur is the one who adopts a great caution and scepticism in introducing any change in the business. He doesn’t take any risk at all and imitates only when it is clear that failure to do so would result in heavy loss for him.

(iii) Technocrat entrepreneur: A technocrat entrepreneur develops new and improved quality of goods as a result of his craftsmanship. He is highly skilled in production techniques.

(iv) Technical entrepreneur: A technical entrepreneur demonstrates his innovative capabilities in matter of production of goods and rendering of services. He concentrates more on production than marketing.

(v) Agricultural entrepreneur: Agricultural entrepreneurs refer to those entrepreneurs who invest in agriculture sectors and help to provide education and employment opportunities to people especially those located in struggling regions.

(vi) Women entrepreneur: Women entrepreneurs are the women or group of women who initiate, organise and operate a business enterprise. The GOI has defined women entrepreneur as “an enterprise owned and controlled by a woman having a minimum financial interest of 51% of capital and giving atleast 51% of the employment generated in the enterprise to women.”

Question 5.
Explain the characteristics of a successful entrepreneur.
Answer:
The characteristics of a successful entrepreneur are:
1. Disciplined: The individuals are focused on making their businesses work and eliminate any hindrances and distractions towards achieving their goals. They have overarching strategies and outline the tactics to accomplish them. Successful entrepreneurs are disciplined enough to take steps every day toward the achievement of their objectives.

2. Confidence: The entrepreneur do not ask questions about whether they can succeed or whether they are worthy of success. They are confident with the knowledge that they will make their businesses succeed. They exude that confidence in everything they do.

3. Open Minded: Entrepreneurs realize that every event and situation is a business opportunity. Ideas are constantly being generated about workflows and efficiency, people skills and potential new businesses. They have the ability to look at everything around them and focus it toward their goals.

4. Self-Starter: Entrepreneurs know that if something needs to be done, they should start it themselves. They set the parameters and make sure that projects follow that path. They are proactive, not waiting for someone to give them permission or to motivate them to achieve.

5. Competitive: Many companies are formed because an entrepreneur knows that they can do a job better than another. They need to win at the sports they play and need to win at ,the businesses that they create. An entrepreneur will highlight their own company’s track record of success.

6. Creativity: One facet of creativity is being able to make connections between seemingly unrelated events and situations. Entrepreneurs often come up with solutions which are the synthesis of other items. They will re-purpose products to market them to new industries.

7. Determination: Entrepreneurs are not thwarted by their defeats. They look at defeat as an opportunity for success. They are determined to make all of their endeavours succeed, try and try again until it does is the success mantra. Successful entrepreneurs do not believe that something cannot be done.

8. Strong people skills: The entrepreneur has strong communication skills to sell the product and motivate employees. Most successful entrepreneurs know how to motivate their employees so the business grows overall. They are very good at highlighting the benefits of any situation and coaching others to their success.

9. Strong work ethic: The successful entrepreneur will often be the first person to arrive at the office and the last one to leave. They will come in on their days off to make sure that an outcome meets their expectations. Their mind is constantly on their work, whether they are in or out of the workplace.

10. Passion: Passion is the most important trait of the successful entrepreneur. They genuinely love their work. They are willing to put in those extra hours to make the business succeed because there is a joy their business gives which goes beyond the money. The successful entrepreneur will always be reading and researching ways to make the business better.

Successful entrepreneurs want to see what the view is like at the top of the business mountain. Once they see it, they want to go further. They know how to talk to their employees and their businesses soar as a result.