Meaning of EDPs

According to N. P. Singh :
"Entrepreneurship Development Programme is designed to help an individual in strengthening his
entrepreneurial motive and in acquiring skills and capabilities necessary for playing his entrepreneurial role
effectively. is necessary to promote this understanding of motives and their impact on entrepreneurial values
and behavior for this purpose”.

EDP can also be defined as a pre-defined process that recognizes, inculcates, designs, and refines the skills
and proficiencies of an individual to establish his enterprise. In recent times, EDP has become a professional
task that extensively encourages the development of funded and private businesses. The program is meant to
grow entrepreneurial aptitudes among people.

The concept of an entrepreneurship development program involves equipping a person with the required
skills and knowledge needed for starting and running the enterprise.

Need and Importance of EDP

The importance of entrepreneurship development Programme (EDP) is to enable entrepreneurs
initiating and sustain the process of economic development in the following ways:

1) Creation of Employment Opportunities: Unemployment is one of the most important problems

confronting developing and underdevelopment countries, EDP’s enable prospective entrepreneurs in
the setting up of their own units, thus enabling them to get self-employment. With the setting up of
more and more units by entrepreneurs, both on a small and large scale, numerous job opportunities
are created for the others.

2) Capital Formation: It is not possible to set up an enterprise without adequate funds. An entrepreneur
as an organizer of factors of production employs his own as well as borrowed resources for the setting
up of his enterprise. Entrepreneur mobilizes idle savings of the public and put them to productive use.
In this way, he helps in capital formation, which is so essential for the industrial and economic
development of a country. Various development banks like ICICI, IFCI, IDBI; SFCs, and SIDCs take
initiative in promoting entrepreneurship through assistance to various agencies involved in EDP and
by providing financial assistance to new entrepreneurs.
3) Balanced Regional Development: Small-scale units can be set up in industrially backward and
remote areas with limited financial resources. Successful EDPs assisted in accelerating the pace of
industrialization in the backward areas and reduces the concentration of economic power in the hands
of a few. Setting up more units leads to more development of backward areas and balanced regional
development.

4) Use of Local Resources: In the absence of any initiative local resources are likely to remain unutilized.
Proper use of these resources can result in the progress or development of the area and that too at a
lower cost. Effective EDPs can help in the proper use of local resources by providing guidance,
assistance, education, and training to prospective entrepreneurs.

5) Improvement in Capita Income: Entrepreneurs are always on the lookout for opportunities. They
explore and exploit the opportunities. Entrepreneurs take lead in organizing various factors of
production by putting them into productive use through the setting up of enterprises. More
enterprises will lead to more production, employment, and generation of wealth in the form of goods
and services. It will result in an increase in the overall productivity and per capita income in the country.
EDPs play a positive role in the setting of more units and thus help in the generation of more
employment and income.

6) Improvement in the Standard of Living: Entrepreneurs by adopting the latest innovations help in
the production of a wide variety of goods & services. By making efficient use of the resources, they
start producing more of better quality, and that too at lower costs. This enables them to ensure easy
availability of better quality products at lower prices to the consumers which result in the improvement
in the standard of living of the people.
7) Economic Independence: Entrepreneurs enable a country to produce a wide variety of better quality
goods & services and that too at competitive prices. They develop substitutes of the goods being
imported and thus prevent over-dependence on foreign countries and at the same time help in the
saving of precious foreign exchange. Through sale of their surplus products in foreign market
entrepreneurs enable a country to earn foreign exchange, which is so essential for meeting
developmental needs of the economy. Export promotion and import substitution thus help in
promoting economic independence of the economy.

8) Facilitating Overall. Development: EDPs facilitate entrepreneurship which helps in the overall
development of the society by producing new products, innovative services, low cost consumer goods,
job opportunities, increasing the standard of living, and overall productivity. This facilitates in the
overall development of the economy and the country.
 9) Enhancing managerial abilities: Entrepreneur development programmes help the entrepreneurs to
enhance their organizing and managerial abilities so that they can run their enterprise efficiently and
successfully. This is done through organizing educational, management, training and orientation
programmes. Various specialized agencies like National Institute for Entrepreneurship and small
Business Development(NIESBUD),New Delhi and Entrepreneurship Development Institute of
India(EDII), Ahmadabad are engaged in entrepreneurship programmes.

Behavioral scientists have tried to seek answers to these questions.

A well-known behavioural scientist David C. McClelland (1961) at Harvard University made an interesting
investigation-cum-experiment into:

• why certain societies displayed great creative powers at particular periods of their history?

• What was the cause of these creative bursts of energy?

He found that ‘the need for achievement’ was the answer to this question. It was the need for achievement
that motivates people to work hard. According to him, moneymaking was incidental. It was only a measure
of achievement, not its motivation.

In order to answer the next question whether this need for achievement could be induced, he conducted a
five-year experimental study in Kakinada, one of the prosperous districts of Andhra Pradesh in India in
collaboration with Small Industries Extension and Training Institute (SIET), Hyderabad.

 Kakinada is an industrial town in Andhra Pradesh.

 The experiment started in January 1964.

 This experiment is popularly known as ‘Kakinada Experiment’. Under this experiment, young
persons were selected and put through a three-month training programme and motivated to see fresh
goals.

 One of the significant conclusions of the experiment was that the traditional beliefs did not seem to
inhibit an entrepreneur and that the suitable training can provide the necessary motivation to the
entrepreneurs (McClelland & Winter 1969).

 The achievement motivation had a positive impact on the performance of entrepreneurs.

 The ‘Kakinada Experiment’ could be treated as a precursor to the present day EDP inputs on
behavioural aspects.
  In a sense, the ‘Kakinada Experiment’ is considered as the seed for the Entrepreneurship
Development Programmes (EDPs) in India.

The fact remains that it was the ‘Kakinada Experiment’ that made people appreciate the need for and
importance of the entrepreneurial training, now popularly known as ‘EDPs’, to induce motivation and
competence among the young prospective entrepreneurs.

Based on this, it was the Gujarat Industrial Investment Corporation (GIIC) which, for the first time,
started a three-month training programmes on entrepreneurship development. Impressed by the results of
GIIC’s this training programme, the Government of India embarked, in 1971, on a massive programme on
entrepreneurship development. Since then, there is no looking back in this front. By now, there are some 686
all-India and State level institutions engaged in conducting EDPs in hundreds imparting training to the
candidates in thousands.

Till now, 12 State Governments have established state-level Centre for Entrepreneurship Development
(CED) or Institute of Entrepreneurship Development (lED) to develop entrepreneurship by conducting
EDPs. Today, the EDP in India has proliferated to such a magnitude that it has emerged as a national
movement. It is worth mentioning that India operates the oldest and largest programmes for
entrepreneurship development in any developing country.

The impact of India’s EDP movement is borne by the fact that the Indian model of entrepreneurship
development is being adopted by some of the developing countries of Asia and Africa. Programmes similar
to India’s EDPs are conducted in other countries also, for example, ‘Junior Achievement Programme’ based
on the principle of ‘catch them young’ in USA and ‘Young Enterprises’ in the U. K.

OBJECTIVES OF EDP:
The major objectives of the Entrepreneurship Development Programmes (EDPs) are to:

a. Develop and strengthen the entrepreneurial quality, i.e. motivation or need for achievement.

b. Analyse environmental set up relating to small industry and small business.

c. Select the product.

d. Formulate proposal for the product.

e. Understand the process and procedure involved in setting up a small enterprise.

f. Know the sources of help and support available for starting a small scale industry.

g. Acquire the necessary managerial skills required to run a small-scale industry.

h. Know the pros and cons in becoming an entrepreneur.

i. Appreciate the needed entrepreneurial discipline.

j. Besides, some of the other important objectives of the EDPs are to:

k. Let the entrepreneur himself / herself set or reset objectives for his / her enterprise and strive for their
realization.

l. Prepare him / her to accept the uncertainty in running a business.

m. Enable him / her to take decisions.

n. Enable to communicate clearly and effectively.

o. Develop a broad vision about the business.

The entrepreneurship development programme (EDP) normally runs through three important phases
followed by EDP evaluation:

Phases of Entrepreneurial Development Programme An entrepreneurial development programme consists of

three broad phases:

1. Pre-training Phase

2. Training Phase

3. Post-training Phase

1. Initial Phase :

This phase includes the activities and the preparations required to launch the training programme.

The main activities of this phase are:

(a) Arrangement of Infrastructure for training

(b) Preparation of training syllabus and application form

(c) Tie up of guest faculty

(d) Designing tools and techniques for selecting the trainees

(e) Formation of selection committee ‘

 (f) Publicity campaign for the programme Thus, initial stage involves the identification and selection of
potential entrepreneurs and providing initial motivation to them.

2. Training Phase :

In this phase the training programme is implemented to develop motivation and skills among the
participants. The objective of this phase is to bring desirable changes in the behaviour of the trainees. The
trainers have to judge how much, and how far the trainees have moved in their entrepreneurial pursuits. A
trainer should see the following changes in the behaviour of participants.

(a) Is there any change in his entrepreneurial outlook, role and skill ?

(b) Is he motivated to plunge for entrepreneurial venture and risk that is expected of an entrepreneur?

(c) What kind of entrepreneurial behaviour does the trainee lack?

(d) Does he possess the knowledge of technology, resources and other related entrepreneurial
knowledge?

(e) Is he skilful in choosing the right project, mobilising the right resources at the right time?

3. Post-Training or Follow-up Phase :

Under this phase it is assessed that how far the objectives of the programme have been achieved.

Monitoring and follow up reveals drawbacks in the earlier phases and suggests guidelines, for framing the
future policy.

In this phase infrastructural support, counselling and assistance in establishing new enterprise and in
developing the existing units can also be reviewed.

Entrepreneurship Development Programme – Course Contents and

Curriculum of EDPs
The course contents of an entrepreneurship development program are selected in line with objectives of the
EDPs. The EDP training programme is usually for six weeks’ duration.

It consists of the following six inputs:

1. General Introduction to Entrepreneurship:

First of all, the participants are exposed to a general knowledge of entrepreneurship such as factors affecting
small-scale industries, the role of entrepreneurs in economic development, entrepreneurial behaviour, and the
facilities available for establishing small-scale enterprises.

2. Motivation Training:

The training inputs under this aim at inducing and developing the need for achievement among the
participants. This is, in fact, a crucial input of entrepreneurship training. Efforts are made to inject confidence
and positive attitude and behaviour among the participants towards business.

It ultimately tries to make the participants start their own business enterprise after the completion of the
training programme. In order to further motivate the participants, sometimes successful entrepreneurs are also
invited to speak about their experiences in setting up and running a business.

3. Management Skills:

Running a business, whether large or small requires the managerial skills. Since a small entrepreneur cannot
employ a management professionals /experts to manage his/her business, he/she needs to be imparted basic
and essential managerial skills in the different functional areas of management like finance, marketing, human
resource, and production.

Knowledge of managerial skills enables an entrepreneur to run his/her enterprise smoothly and successfully.
That is why the saying goes that “One man control is the best in the world (of business) if the man is big
enough to control (manage) everything.”

4. Support System and Procedure:

The participants also need to be exposed to the support available from different institutions and agencies for
setting up and running small-scale enterprises. This is followed by acquainting them with procedure for
approaching them, applying and obtaining support from them.

5. Fundamentals of Project Feasibility Study:

Under this input, the participants are provided guidelines on the effective analysis of feasibility or viability of
the particular project relating to marketing, organization, technical, financial, and social aspects of the project.
Knowledge is also given how to prepare the ‘Project’ or ‘Feasibility Report’ for certain products.

6. Plant Visits:

In order to familiarize the participants with real life situations in small business, plant visits are also arranged.
Such trips help the participants know more about an entrepreneur’s behaviour, personality, thoughts, and
aspirations. These influence him / her to behave accordingly to run his / her enterprise smoothly and
successfully.

On the whole, the ultimate objective of entrepreneurship development programme is to make the trainees
prepared to start their own enterprises after the completion of the training programme. This is the ultimate
measure of success levels of the EDPs

PROBLEMS FACED BY ENTREPRENEUR DEVELOPMENT

PROGRAMMES
EDPs in India are affected with a number of problems which are responsible for low level of success of the
programmes. The problems come from the trainers, trainees, the various organisations imparting training
programmes, the supporting organisation and even sometimes the government. Some of the important
problems faced by EDPs are narrated as follows:

i. No clear-cut policy at the national level:

India do not have a clear-cut national policy on entrepreneurship. Therefore, the growth and development of
entrepreneurship put to a halt due to the antithetic attitude of the supporting agencies like banks, financial
institutions and other supporting agencies in the absence of a policy at the national level.

ii. No clear-cut objectives:

Majority of institutions engaged in EDP are themselves not convinced and certain about the task they are
supposed to perform and objectives to achieve. They are conducting EDP because they have to conduct the
same.
iii. No clear cut course of action:
The course contents are not standardized and the agencies engaged in EDPs are themselves not very clear
about the course of action they are supposed to follow. There is no accountability and feed back system for
further improvement.

iv. Poor follow-up:

Institutions providing EDPs do not show much concern for objective identification and selection of
entrepreneurs. No follow-up actions follow EDPs after training.

v. Non-availability of Infrastructural facilities :

EDPs are not successful due to non-availability of adequate infrastructural facilities required for the conduct
of EDPs. Rural and backward areas are lacking in proper class rooms, guest speakers, boarding and lodging
etc. for successful conduct of EDPs.
vi. Lack of commitment and involvement by the Corporate Sector:
Corporate sector shows less concern for the successful conduct of EDPs. They lack of commitment and
involvement in EDPs. There seems to be low institutional support entrepreneurs.

vii. Non-availability of competent faculty:

The faculties selected for giving training are not sometimes competent enough to give proper training to
prospective entrepreneur. Even if competent and qualified teachers available, they are reluctant to serve in
rural and backward areas. This creates problem smooth conduct of EDPs.

viii. Non conducive environment:

Non-conducive environment and constraints in the backward regions has become a major problem for the
conduct of EDPs. It makes the trainer-motivator’s role ineffective.

ix. Selection of wrong trainees:

There is no uniform procedure adopted by various agencies and institutions conducting EDPs for the selection
of trainees. This results in the selection of wrong trainees which leads to low success rate of EDPs.