Entrepreneurship Management

Q.1) Characteristics and advantages of entrepreneurship.

Ans.
Entrepreneurship is the process of identifying and pursuing opportunities to
create and grow new businesses or innovate within existing ones. It is
characterized by certain traits and offers numerous advantages. Here are some
of the key characteristics and advantages of entrepreneurship:
Characteristics of Entrepreneurship: CODE [IRVFS]

1. Innovation: Entrepreneurs are often driven by the desire to create

something new or improve upon existing solutions. They seek innovative ways
to solve problems or meet unmet needs.

2. Risk-taking: Entrepreneurship inherently involves a degree of risk, as

entrepreneurs invest their time, money, and resources in pursuit of their ideas.
They are willing to take calculated risks in the hope of achieving substantial
rewards.

3. Vision and Creativity: Successful entrepreneurs have a clear vision of

what they want to achieve and the creativity to develop novel concepts and
products. They see opportunities where others may not.

4.Flexibility and Adaptability: Entrepreneurs must adapt to changing

circumstances and market conditions. They are often open to adjusting their
strategies and pivoting their businesses when necessary.

5.Self-motivation: Entrepreneurs are typically self-starters who are driven by

their passion and ambition. They don't rely on external motivations to pursue
their goals.
Advantages of Entrepreneurship: COD [IF-JID]

1. Independence: Entrepreneurs have the freedom to make their own

decisions and control their businesses. They are not bound by the rules and
constraints of traditional employment.

2. Financial Rewards: Successful entrepreneurship can lead to significant

financial rewards, including profits, equity ownership, and potential for capital
gains.

3. Job Creation: Entrepreneurs create job opportunities for themselves and

others, contributing to economic growth and reducing unemployment.

4. Innovation and Progress: Entrepreneurship drives innovation, which can

lead to advancements in technology, products, and services that benefit
society as a whole.

5. Diversification: Entrepreneurship allows individuals to diversify their

income sources and reduce dependency on a single employer or income
stream.

Q.2) Women Entrepreneur problems / challenges faced by them.

Ans.
Women entrepreneurs face a range of challenges and issues, many of which
are rooted in societal, cultural, and systemic factors. These challenges can vary
depending on geographic location, industry, and personal circumstances, but
here are some common problems and issues faced by women entrepreneurs:
CODE [NAG-BA]
1. Access to Capital: Women often have more difficulty accessing funding
and investment capital for their businesses. This can be due to biases among
investors, limited access to financial networks, or a lack of collateral.

2. Gender Bias and Stereotypes: Deep-seated gender biases and

stereotypes can affect how women entrepreneurs are perceived and treated in
business. These biases can impact negotiations, partnerships, and
opportunities for growth.

3. Networking Challenges: Women may face barriers in building

professional networks, as many business events and opportunities have
traditionally been male-dominated. This lack of access to networks can limit
business growth and opportunities.

4. Balancing Work and Family: Women entrepreneurs often juggle multiple

roles, including caregiving responsibilities. Balancing the demands of work and
family life can be particularly challenging, leading to burnout and stress.

5. Access to Education and Training: In some regions, women may have

limited access to entrepreneurship education and training programs, which can
hinder their ability to develop essential skills for business success.

Q.3) Intrapreneurship.
Ans.
Intrapreneurship refers to the practice of cultivating an entrepreneurial
mindset and behavior within an established organization, typically a large
corporation or company. Intrapreneurs are employees who exhibit
entrepreneurial qualities and work within the confines of an existing
organization to drive innovation, develop new products or services, and create
value.
Here are some key aspects of intrapreneurship:

1. Entrepreneurial Mindset: Intrapreneurs possess many of the same

characteristics as entrepreneurs, such as creativity, risk-taking, initiative, and a
willingness to challenge the status quo. They are driven by a desire to identify
and pursue opportunities for growth and innovation within their organization.

2. Corporate Environment: Intrapreneurs operate within the framework of

an existing company. They use the company's resources, infrastructure, and
support to develop new ideas and projects.

3. Innovation: Intrapreneurship is all about fostering innovation within an

organization. Intrapreneurs are encouraged to come up with fresh ideas,
processes, and products that can help the company adapt to changing market
conditions or gain a competitive edge.

4. Risk-Taking: Intrapreneurs are willing to take calculated risks to bring

their innovative ideas to fruition. They understand that not every venture will
be successful, but they are willing to learn from failures and adapt.

5. Autonomy: Successful intrapreneurs often have a degree of autonomy

and independence within their organization. They have the freedom to explore
new opportunities and develop their projects without excessive bureaucratic
constraints.

6. Resource Utilization: Intrapreneurs leverage the resources and support

available within their organization, such as funding, expertise, and existing
customer bases, to launch and grow their initiatives.
Q.4) Franchising Ans.
Franchising is a business model that involves the granting of a license by a
franchisor (the business owner) to a franchisee (an independent business
operator) to operate a business under the franchisor's brand, using their
established business system and support. It's a popular approach in
entrepreneurship management for individuals who want to start their own
businesses but prefer a proven and structured system with a recognizable
brand. Here are key aspects of franchising in entrepreneurship management:

Q.5) Role of commercial bank.

CODE [ABS-WBCM ]

Ans.
Commercial banks play a significant role in entrepreneurship management by
providing a range of financial services and support to entrepreneurs and small
business owners. Their role is essential in helping entrepreneurs access the
capital and resources needed to start, grow, and manage their businesses
effectively. Here are some key roles of commercial banks in entrepreneurship
management:
1. Access to Capital: Commercial banks offer various forms of financing,
such as loans, lines of credit, and business credit cards, to help entrepreneurs
secure the necessary capital for startup costs, working capital, expansion, and
other business needs.

2. Business Loans: Banks provide entrepreneurs with business loans that

can be used for purposes like purchasing equipment, acquiring real estate,
financing inventory, or funding marketing campaigns. These loans come with
various terms and interest rates, catering to different business needs.

3. Working Capital: Entrepreneurs often require short-term working capital

to cover day-to-day operational expenses. Commercial banks offer working
capital loans or lines of credit to ensure smooth business operations.
4. Start-up Financing: Banks may offer specialized start-up loans or
packages designed to help entrepreneurs turn their business ideas into reality.
These loans often have favorable terms for new businesses.

5. Business Checking and Savings Accounts: Commercial banks provide

dedicated business checking and savings accounts to help entrepreneurs
manage their finances efficiently, separate personal and business expenses,
and save for future needs.
6. Cash Management Services: Banks offer various cash management
solutions to assist businesses in optimizing their cash flows, managing
payments, and automating financial processes.

7. Merchant Services: Entrepreneurs can utilize banking services to set up

payment processing systems, accept credit card payments, and manage their
online sales channels.

Q.6) Role of Small Scale industry,.

Ans.
Small-scale industries, often referred to as small and medium-sized enterprises
(SMEs), play a crucial role in entrepreneurship management and economic
development. They serve as breeding grounds for entrepreneurs and
contribute significantly to job creation, innovation, and overall economic
growth. Here are some key roles that small-scale industries play in
entrepreneurship management:

1. Job Creation: Small-scale industries are significant contributors to

employment generation. They create job opportunities for a diverse workforce,
including skilled and unskilled workers, which helps reduce unemployment and
poverty levels.

2. Entrepreneurship Development: Small-scale industries provide a

platform for individuals to become entrepreneurs. Many entrepreneurs start
their businesses on a small scale and gradually expand, gaining valuable
experience and business management skills along the way.

3. Innovation and Creativity: SMEs are often more agile and innovative than
larger corporations. They can quickly adapt to changing market conditions and
introduce new products, services, and processes, fostering innovation within
the local economy.
4. Local Economic Development: Small-scale industries contribute to the
development of local economies by creating local supply chains, stimulating
consumer spending, and generating tax revenue that can be reinvested in
community development.

5. Diversification of Industries: SMEs represent a diverse range of industries

and sectors, which helps diversify the economy and reduce dependence on a
few large industries. This diversification can enhance economic resilience.

6. Rural Development: Small-scale industries can play a vital role in rural

development by establishing businesses in rural areas, thereby reducing urban
migration, boosting local economies, and improving the overall quality of life in
rural communities.

Q.7) Role of NABARD and NSIC. CODE [ AR-DII ] Ans.

NABARD (National Bank for Agriculture and Rural Development) and NSIC
(National Small Industries Corporation) are two important institutions in India
that play distinct yet complementary roles in supporting economic
development, especially in rural and small-scale sectors. Here's an overview of
their roles and functions

**NABARD (National Bank for Agriculture and Rural Development):**

1. Rural Development: NABARD's primary focus is on promoting rural
development in India. It provides financial and developmental support to
various rural sectors, including agriculture, rural infrastructure, and micro and
small enterprises.

2. Agricultural Credit: NABARD plays a crucial role in providing agricultural

credit and coordinating various credit schemes for farmers. It acts as a
refinancing agency for rural and cooperative banks and facilitates the flow of
credit to rural areas.

3. Rural Infrastructure Development: NABARD supports the development

of rural infrastructure, including irrigation, roads, and warehousing facilities, to
enhance agricultural productivity and rural livelihoods.

4. Rural Innovation: It promotes rural innovation by funding research and

development projects, technology adoption, and the dissemination of best
practices among farmers and rural communities.

**NSIC (National Small Industries Corporation):** CODE [ SFMT ]

1. Small and Micro Enterprises (SMEs): NSIC is primarily focused on
supporting the growth and development of small and micro enterprises. It
provides various services to assist SMEs in becoming more competitive and
sustainable.

2. Facilitation of Finance: NSIC facilitates the availability of credit and

finance for SMEs by acting as an intermediary between banks and financial
institutions and small businesses.

3. Marketing Support: NSIC helps SMEs in marketing their products and

services by providing various marketing assistance schemes, including
participation in trade fairs and exhibitions, both nationally and internationally.
4. Technology Upgradation: NSIC offers technology support and assistance
in the adoption of modern technologies to enhance the competitiveness of
SMEs.

In summary, NABARD primarily focuses on rural development, agriculture, and

rural finance, while NSIC specializes in promoting and supporting small and
micro enterprises in various aspects, including finance, marketing, technology,
and export promotion. Together, these organizations contribute significantly to
India's economic growth and the welfare of rural and small-scale sector.

Q.8) Types of mergers.

Ans.
In entrepreneurship management, mergers are strategic actions that involve
the consolidation of two or more businesses into a single entity. Mergers can
offer various advantages, including synergy, increased market power, and
improved operational efficiency. There are several types of mergers, each with
its own characteristics and objectives. Here are some common types of
mergers:

1. Horizontal Merger:
A horizontal merger occurs when two companies operating in the same or
similar industries and producing similar products or services merge to form a
single entity.

2. Vertical Merger:
In a vertical merger, two companies in the same supply chain but at different
stages of production or distribution merge. This can involve a supplier and a
customer or two firms involved in different aspects of the same industry.

3. Conglomerate Merger:
Conglomerate mergers involve the consolidation of two companies that
operate in entirely different industries or sectors, with little or no direct
business relationship.
4. Market Extension Merger:
Market extension mergers occur when two companies serving the same
products or services in different geographic regions merge.

5. Product Extension Merger:

Product extension mergers involve two companies that produce
complementary or related products or services, expanding their product
offerings.

6. Congeneric Merger:
Congeneric mergers involve companies in related but not identical industries,
often with similar customer bases or distribution channels.

7. Reverse Merger:
In a reverse merger, a private company acquires a publicly traded company,
usually one with an existing stock exchange listing. This allows the private
company to become publicly traded without undergoing an initial public
offering (IPO).

Q.9) Incubation services.

ns.
Certainly, let's break down incubation services in simple terms:

Imagine you have a brilliant idea for a business, like creating a new app or
selling a unique product. Starting a business can be challenging, but that's
where incubation services come in.
1. Workspace: Incubation services provide you with a place to work. It's like
having a special office just for your startup, but you don't have to worry about
renting it or setting it up.

2. Guidance: You get help and advice from experienced people who have
already started businesses. They become like your business coaches, giving you
tips on how to make your idea a reality.

3. Money: Sometimes, these services can help you find money to start
your business. They introduce you to investors or show you how to apply for
loans or grants.

4. Learning: You can attend classes or workshops to learn more about

running a business. It's like going to school, but it's all about business stuff like
marketing, finance, and how to sell your product.

5. Equipment and Resources: You may get access to tools and equipment
you need, like computers or machines. This can save you a lot of money since
you don't have to buy them yourself.

6. Friends and Partners: You meet other people who are also starting
businesses. Sometimes, these connections can lead to partnerships or new
customers for your business.

Overall, incubation services are like a supportive team that helps you turn your
business idea into a real, successful company. They provide you with the tools,
knowledge, and support you need to get started and grow your business.
Q.10) Merits and Demerits of small scale industry.
Ans.
Small-scale industries, also known as small and medium-sized enterprises
(SMEs), play a vital role in economies around the world. They offer numerous
benefits, but they also face certain challenges. Here are some merits and
demerits of small-scale industries:

Merits (Advantages) of Small Scale Industries:

1. Employment Generation: Small-scale industries are significant job

creators. They provide employment opportunities to a large segment of the
population, including skilled, semi-skilled, and unskilled workers, thus reducing
unemployment.

2. Local and Regional Development: Small businesses are often located in

smaller towns and rural areas, contributing to local and regional economic
development. They help in reducing the migration of people to urban centers.

3. Innovation and Entrepreneurship: Small-scale industries are often more

innovative and agile than larger corporations. They can quickly adapt to
changing market conditions, introduce new products or services, and foster
entrepreneurship.

4. Reduced Bureaucracy: Smaller businesses typically have simpler

organizational structures and fewer layers of bureaucracy, making them more
nimble and responsive to customer needs.

5. Customization and Personalization: Small businesses can offer more

personalized and customized products or services, catering to niche markets
and meeting unique customer demands.
Demerits (Disadvantages) of Small Scale Industries:

1. Limited Resources: Small-scale industries often have limited financial

resources, making it challenging to invest in research and development,
modern technology, and market expansion.

2. Competition with Larger Firms: Small businesses may struggle to

compete with larger corporations due to economies of scale, greater market
reach, and financial strength.

3. Access to Finance: Securing funding can be more difficult for small-scale

industries. They may face higher interest rates and collateral requirements
when seeking loans.

4. Vulnerability to Economic Fluctuations: Smaller businesses are often

more vulnerable to economic downturns and market uncertainties, as they
may lack the resources to weather challenging times.

5. Limited Bargaining Power: Small-scale industries may have less

bargaining power with suppliers, customers, and government authorities,
making it challenging to negotiate favorable terms.

Q.11 Challenges of family business. CODE [ CS-CR-FL ] Ans.

Family businesses, while often characterized by strong values, traditions, and a
sense of legacy, also face a unique set of challenges. These challenges can
affect the family, the business, and the relationships between family members.
Here are some common challenges faced by family businesses:

1. Succession Planning: One of the most significant challenges is planning

for the transition of leadership and ownership to the next generation.
Navigating issues related to selecting the right successor, preparing them for
leadership, and managing the handover process can be complex and
emotionally charged.

2. Conflict Resolution: Family dynamics can lead to conflicts, both in terms

of business decisions and personal relationships. Balancing family harmony
with the best interests of the business can be challenging.

3. Role Clarity: In a family business, roles and responsibilities are often

intertwined with family relationships. Clear lines of authority and
responsibilities can be blurred, leading to confusion and inefficiencies.

4. Communication Issues: Effective communication is essential, but family

members may struggle to separate business discussions from personal matters.
Miscommunication or lack of open and honest dialogue can hinder
decisionmaking.

5. Fairness and Equity: Maintaining a sense of fairness among family

members, especially when some are actively involved in the business while
others are not, can be a delicate issue. Determining how profits and
responsibilities are shared can lead to disputes.

6. Lack of Professionalism: Family businesses may suffer from a lack of

professionalism in management practices, governance, and decision-making,
which can hinder growth and competitiveness.

Q.12 Merits of family business. CODE [ CS-FLRT ] Ans.

Family businesses offer several merits and advantages that contribute to their
success and resilience. Here are some of the key merits of family businesses:
1. Long-Term Orientation: Family businesses often have a long-term
perspective, which can lead to stability and sustainability. They are less focused
on short-term gains and are more inclined to invest in the business's future.

2. Strong Values and Culture: Family businesses tend to have a strong set
of values and a distinct company culture that can be attractive to employees,
customers, and partners. These values often align closely with the family's
principles and vision.

3. Commitment and Loyalty: Family members typically have a deep

commitment and emotional attachment to the business's success. This loyalty
can translate into a strong work ethic and dedication to the company's growth.

4. Trust and Relationships: Trust among family members is often high,

which can lead to effective decision-making and collaboration within the
business. Strong family relationships can also contribute to a cohesive and
motivated workforce.

5. Flexibility and Agility: Family businesses can be more agile and

adaptable to changing market conditions. They can make quick decisions
without the bureaucratic layers found in larger organizations.

6. Reduced Agency Costs: In family businesses, there may be fewer

conflicts of interest between owners and managers since they are often the
same individuals. This can reduce agency costs and improve corporate
governance.