Entrepreneurship Two Marks Questions and Answers

 

            EPS  MECH

Two Marks Questions and Answers

 

1. Define Entrepreneur.

An Entrepreneur is an individual with knowledge, skills, initiative, drive and spirit of innovation who aims at achieving goals. An entrepreneur identifies opportunities and seizes opportunities for economic benefits. Entrepreneurship is a dynamic activity which helps the entrepreneur to bring changes in the process of production, innovation in production, new usage of materials, and creator of market.

2. State the various types of Entrepreneurs

Depending upon the level of willingness to create innovative ideas, there can be the following types of entrepreneurs:

1. Innovative entrepreneurs

These entrepreneurs have the ability to think newer, better and more economical ideas of business organisation and management.

2. Imitating entrepreneurs

They imitate innovative entrepreneurs because the environment in which they operate is such that it does not permit them to have creative and innovative ideas on their own.

3. Fabian entrepreneurs

Fabian entrepreneurs are those individuals who do not show initiative in visualising and implementing new ideas and innovations wait for some development which would motivate them to initiate unless there is an imminent threat to their very existence.

4. Drone entrepreneurs

Drone entrepreneurs are those individuals who are satisfied with the existing mode and speed of business activity and show no inclination in gaining market leadership.

5. Social Entrepreneur

Social entrepreneurs drive social innovation and transformation in various fields including education, health, human rights, workers’ rights, environment and enterprise development.

3. What are the traits of an Entrepreneur?

1. Strong leadership: A strong leader has strong communication skills and the ability to team of people towards a common goal in a way that the entire team is motivated and works effectively to get there as a team.

2. Highly motivated: Leaders adapt well to hanging situations and are typically expert of helping their teams change with them by motivating them towards new goals and opportunities.

3. Strong sense of basic ethics and integrity: With importance in working with clients or leading a team, effective leaders admit to any error made and offer solutions to correct rather than lie or blame others.

4. Willingness to fail: Successful entrepreneur is risk takers and not afraid of failure.Entrepreneurs are often successful because they are calculating and able to make the best desisions in even the worst of cases.

5. Serial innovators: Entrepreneurs are almost defined by ther drive to constantly develop new ideas and imporve on existing processes.

6. Know what you don’t know: Successful entrepreneurs are confident and they learn new ways of doing business.

7. Competitive spirit: Entrepreneurs enjoys a challenge and they like to win. In business, it’s a constant war with competition to win business and grow market share.

8. Understand the value of a strong peer network: In almost every case, entrepreneurs never get to success alone. The best understand it takes a network of contacts, business partners, financial partners, peers and resources to succeed. Effective people nurture these relationships and surround themselves with people who can make them more effective.

4.  Define Social Responsibility of an entrepreneur.

Social responsibility is a duty every individual or organization has to perform so as to maintain a balance between the economy and the ecosystem. A trade-off always exists between economic development, in the material sense, and the welfare of society and the environment. Social responsibility is a way of conducting business through balancing the long-term objectives, decision-making, and behaviour of a company with the values, norms, and expectations of society.

5. Define Business Ethics.

Ethics is the branch of philosophy concerned with the meaning of all aspects of human behaviour. Theoretical ethics, sometimes called normative ethics, is about discovering right from wrong. Business ethics can be defined as written and unwritten codes of principles and values that govern decisions and actions within a company. In the business world, the organization’s culture sets standards for determining the difference between good and bad decision making and behaviour. There are three parts to the discipline of business ethics: personal, professional, and corporate.           

6. What are the sources of New Ideas?

A sound idea is essential to launch venture, some of the frequently used of sources of ideas for entrepreneur are as follows:

1. Consumers:  Potential entrepreneurs should pay close attention to the final point

of the idea for a new product / service the potential consumers. This can be an informal / formal survey of consumers expressing their opinions.

2.  Existing companies: Entrepreneurs should establish a formal method for

monitoring & evaluating the products & services in the market. Frequently this analysis uncovers ways to improve on these offering that may result in a new product that has more market appeal.

3. Distribution channels: Members of distribution channels are also excellent

sources for new ideas because they are familiar with the needs of the market. They frequently have suggestions. For new product & also help in marketing the entrepreneurs’ newly developed products.

4. Federal Government: The federal government can be source of new product ideas

in two easy. First, the files of patent office contain numerous new product possibilities. Several government agencies & publications are helpful in monitoring patent applications. Second, new product ideas can come in response to government regulations.

5. Research & development: The largest source of new ideas is the entrepreneurs’

own research & development. A formal research & development department is often better equipped & enables the entrepreneurs to conceptualize & develop successful new product.

7. What is Brainstorming?

 Brain storming is the process of generating several ideas about a specific topic. In a formal brain storming session, the leader of the group asks the participants to share their ideas. One person shares an idea, another person reacts to it, another person reacts to the reaction & so on. An electronic whiteboard is used to record all the ideas. The ideas generated during a brain storming session need to be filtered and analyzed. While using brainstorming, these five rules should be followed:

i.                    No criticism is allowed by anyone in the group - no negative comments.

ii.                  Freewheeling is encouraged- the wilder the idea, the better.

8. Define Problem inventory analysis

 This is a method of generating new ideas, where consumers are provided with a list of problems in a general product category. They are then asked to identify and discuss products in this category that have the particular problem. This method can also be used to test a new product idea. An example of food industry, most difficult problems list like weight, taste, appearance & cost.

9. What is Brain writing?

Brain writing is a form of written brain storming. It was created by Bernd Rohrback in 1960s, where the ideas are in silent & written generation of ideas by the group of people. The participants write their ideas on special forms or cards that circulate within the group, which usually consist of six members. Each member generates & writes down three ideas during five minute period & it passed on to other members. If participants located at their own places & sheets are rotated by e-mails.

 

 

10. Define Cause-Effect Analysis.

This is a technique developed by Toyota Motor Corporation & popularized by the Quality circle movement, often with the use of ‘Why-Why analysis’. It is a simple technique of asking a series of ‘Why’ in a sequence when confronted with the problem. That is, each answer to a ‘why’ will be confronted by another ‘why’. For example, a decline in sales may be normally treated as a ‘marketing’ problem, nut a ‘why-why’ analysis may lead to product quality issues, which in turn may lead to machine set up problems, improper employee training etc.,

11. List out the stages in Product Planning & Development.

1. Idea Stage

2. Concept Stage

3. Product Development Stage

4. Test Marketing Stage

5. Commercialization

1. Distinguish between an Entrepreneur and Intrapreneur

Bases of Differences	Entrepreneur	Intrapreneur
1. Nature	An entrepreneur is an independent person in his business operations	An intrapreneur is completely depending on the entrepreneur for everything. He cannot take decision by himself
2. Education	Entrepreneur need not to highly educate. He can learn everything by experience provided he has the basic qualities of a successful entrepreneur	An Intrapreneur enters into an organization with a high education and qualification. He is indeed a business specialist in the chosen field.
3. Funds	An entrepreneur himself raises funds necessary for starting and establishing his enterprise	An intrapreneur is completely free from the generation of funds
4. Risk factor	An entrepreneur has to bear all the risks involved in the business by himself	Intrapreneur need not to bear any risk involved in the business.
5. Work	Entrepreneur is more concerned with doing routine works and something he may not know the important details of his own business	An intrapreneur acts as a specialist in his chosen field and serves as an outside professional
6. Operations	He always operates from outside. The owner is different and the enterprise he owns is different.	Intrapreneur operates form within the organization itself. He is the part and parcel of the organization.
7. Authority	Generally, an entrepreneur operates with a strong authoritarian back-up	Intrapreneur is less authoritarian. He is more adaptable in the organization.

 

1.      Explain the concept of Ethics and Social Responsibilities of an Entrepreneur.

An enterprise must earn profits for its own survival, for expansion, for bearing the risks and finally for the prestige of its management. But profit cannot be the sole objective of the entrepreneur. It is a means and not an end. No enterprise can last long unless along with earning profits, it continues to fulfill its obligations to the society. The ultimate objective of every enterprise has to be the good of the people. Business must be run by the people through the people and for the people. According to H.R. Brown, an entrepreneur, today, has an obligation ‘to pursue those policies, to make those decisions or to follow those lines of action which are desirable, in terms of the objectives and values of the society.                                     

Business Ethics

Ethics is the branch of philosophy concerned with the meaning of all aspects of human behaviour. Theoretical ethics, sometimes called normative ethics, is about discovering and delineating right from wrong. Business ethics can be defined as written and unwritten codes of principles and values that govern decisions and actions within a company. In the business world, the organization’s culture sets standards for determining the difference between good and bad decision making and behaviour. There are three parts to the discipline of business ethics: personal, professional, and corporate.        

Social Responsibility

Social responsibility is a duty every individual or organization has to perform so as to maintain a balance between the economy and the ecosystem. A trade-off always exists between economic development, in the material sense, and the welfare of society and the environment. Social responsibility is a way of conducting business through balancing the long-term objectives, decision-making, and behaviour of a company with the values, norms, and expectations of society.

Ethics and social responsibility are very important values in entrepreneurship ventures. Ethics and social responsibilities of an entrepreneur is certainly an important issue considering the role of social responsibility in society and ethics in business. Social responsibility is beneficial for business community and at the same time for global community. The link between business ethics and corporate social responsibility (CSR).  The two concepts are closely linked:

·         A socially responsible firm should be an ethical firm

·         An ethical firm should be socially responsible

Responsibilities of the Entrepreneur to the different segments of the Society

The most important social responsibilities of an entrepreneur is to reconcile and balance the various conflicting interests in the best possible manner. The various stakeholders are:

1. Employees: Employees need security of job, higher wages, full employment, better conditions of work and opportunities for self-development and promotion. They also desire their work itself to be rewarding and to contribute something good to the society in general. Management, as a part of its social responsibilities, is expected to provide for their social security, welfare, grievances settlement machinery and sharing of excess profits.

2. Stockholders: An entrepreneur must provide safe, fair adequate and stable long-run rate of return and steady capital appreciation to the shareholders for their investments. It must also provide regular, accurate and adequate information about the working of the company.

3. Suppliers: Dealings with the suppliers should be based on integrity, impartiality and courtesy. Terms and conditions regarding delivery of goods and payment of prices must be reasonably fair. Producers may make available to the suppliers the benefits of their information and research so as to promote indigenous growth or for the improvement of the quality of their products.

4. Customers: In the words of Henry Ford, an entrepreneur must provide, “those goods and services which the society needs at a price which the society can afford to pay.” Entrepreneurial ventures must meet the requirements of the customers of different classes, tastes and with different purchasing power at the right time, place, and price and in right quality. An entrepreneur should act as a friend and guide to the customer. He must try to protect consumers’ interest at all costs. He must guard against adulteration, poor quality, lack of service and courtesy to the consumer, misleading and dishonest advertisement, underweighting, supply of stale goods, etc. He must handle the complaints of the customers carefully and efficiently and cooperate to the maximum extent with the consumers associations. A customer must also be protected against the ill effects of monopolistic and restrictive business practices.

 5. Government: Entrepreneurs must abide by the laws of the country in their true spirit. The must conduct their affairs as may cause the minimum possible social damage such as air or water pollution. They must help in the proper implementation of all social improvement policies adopted by the Government. They must pay taxes honestly and promptly.

6. Trade Associations and Competitors: An entrepreneur should develop healthy inter-business relationships with fellow-entrepreneurs. He must adopt fair trade practices regarding prices, quality, terms and conditions of sale and after-sales service. The policy of under-cutting or restricted trade practices should be avoided. An entrepreneur must patronise business associations to ensure development of healthy business practices.

7. Community: The entrepreneurs should manage their business with such competence and skill that it inspires confidence and pride in the mind of the people. They must encourage democratic institutions and assist national integration. Enterprise, on the whole, should act on the ideas of social justice without discrimination of any kind. Business must set high standards of morality and put in all efforts to minimize social damage. It must help in bringing about a cultural, social and economic revolution in the society and lead to the economic growth of the backward regions of the world.

3. Describe in detail the various problem solving techniques in product development.

Creative problem solving is a technique for attaining new ideas focusing on the parameters. Creative ideas & innovations generated by using any of the following techniques:

1. Brain storming: The first technique, brainstorming, is probably the most well known and widely used for both creative problem solving and idea generation. It is an unstructured process for generating all possible ideas about a problem within a limited time frame through the spontaneous contribution of participants. All ideas, no matter how illogical, must be recorded, with participants prohibited from criticizing or evaluating during the brainstorming session.

2.Reverse Brain storming: Reverse brain storming is similar to brain storming except that criticism is allowed. This technique is based on finding faults, since the focus is on the negative aspects of the product, service or idea, care must be taken to maintain the group’s morale. This method stimulates innovative thinking. The process usually involves the identification of everything wrong with an idea, followed by a discussion of ways to overcome these problems.

3.Gordon method: This method, unlike other techniques, begins with group members not knowing the exact nature of the problem. The entrepreneur starts by mentioning a general concept associated with the problem, the group responds by expressing a number of ideas. Then a concept is developed followed by the group to more suggestions for implementation or refinement of the final solution.

4.Brain writing: Brain writing is a form of written brain storming. It was created by Bernd Rohrback in 1960s, where the ideas are in silent & written generation of ideas by the group of people. The participants write their ideas on special forms or cards that circulate within the group, which usually consist of six members. Each member generates & writes down three ideas during five minute period & it passed on to other members. If participants located at their own places & sheets are rotated by e-mails.

5. Check-list method: In this method, a new idea is developed through a list of related issues or suggestions. The entrepreneur can use the list of question / statements to guide. The checklist may take any form & a general checklist is as follows:

i. Uses-put to other uses, new ways to use.

ii. Modify-change meaning, colour, form, shape etc.,

iii. Magnify-what to add? More time, stronger, larger, thicker etc.,

iv. Minify-what to less? Smaller, lower, shorter, lighter etc.,

v. Substitute-other ingredients, other material, other process etc.,

6. Collective Note book method: Under this method, a small notebook that easily fits in a pocket, containing a statement of the problem, blank pages is distributed. Participants consider the problem & its possible solutions, recording ideas at least once, but preferably three times a day. AT the end of a week, list of best ideas is developed, along with any suggestions. This technique can also be used with the group of individuals who record their ideas, giving their notebook to a central coordinator who summarizes all the material & list the ideas in the order of frequency of mention. The summary becomes the topic of final creative focus group discussions by the group participants.

7.Cause-Effect Analysis:  This is a technique developed by Toyota Motor Corporation & popularized by the Quality circle movement, often with the use of ‘Why-Why analysis’. It is a simple technique of asking a series of ‘Why’ in a sequence when confronted with the problem. That is, each answer to a ‘why’ will be confronted by another ‘why’. For example, a decline in sales may be normally treated as a ‘marketing’ problem, nut a ‘why-why’ analysis may lead to product quality issues, which in turn may lead to machine set up problems, improper employee training etc.,

4. Summarize the sources of new ideas in development process.

A sound idea is essential to launch venture, some of the frequently used of sources of ideas for entrepreneur are as follows:

1. Consumers:  Potential entrepreneurs should pay close attention to the final point

of the idea for a new product / service the potential consumers. This can be an informal / formal survey of consumers expressing their opinions.

2.  Existing companies: Entrepreneurs should establish a formal method for

monitoring & evaluating the products & services in the market. Frequently this analysis uncovers ways to improve on these offering that may result in a new product that has more market appeal.

3. Distribution channels: Members of distribution channels are also excellent

sources for new ideas because they are familiar with the needs of the market. They frequently have suggestions. For new product & also help in marketing the entrepreneurs’ newly developed products.

4. Federal Government: The federal government can be source of new product ideas

in two easy. First, the files of patent office contain numerous new product possibilities. Several government agencies & publications are helpful in monitoring patent applications. Second, new p[product ideas can come in response to government regulations.

5. Research & development: The largest source of new ideas is the entrepreneurs’

own research & development. A formal research & development department is often better equipped & enables the entrepreneurs to conceptualize & develop successful new product.

5. Explain the process of Entrepreneurial decision making

An individual needs to pass through a process from present status to become an entrepreneur. In other words, the individual / entrepreneur have to take a number of decisions in sequential order, call it the entrepreneurial decision process, to leave the present status and become an entrepreneur. The decision making process of an individual to become an entrepreneur involves various steps which can be explained as follows:

 

                                                   

1.      The Present Status

Change is often resisted because it involves uncertainty which causes fear. It is due to uncertainty, the present state of affair is considered better than the unknown one after the change. As such, leaving the present status and becoming an entrepreneur (i.e., a synonym of risk and uncertainty) is not easy as it takes a great deal of preparation and courage to do so. Nonetheless, individuals dare it and become entrepreneurs.

Broadly, there are two reasons for individuals to become entrepreneurs:

(i)     By chance, and

(ii) By compulsion.

As regards choice, individuals working in marketing area become familiar with market and gain experience and, in turn, they decide to start their own business in that market. Sales representatives working in publishing companies generally start their own publishing business and present such example of becoming entrepreneurs by choice.

On the other hand, disruption in the present job/status due to retirement, lay-off, and other compulsions also compel people to become entrepreneurs. Thus, the idea and decision to become an entrepreneur, i.e. to start one’s own business enterprise occurs when an individual perceives and realizes that establishing a new enterprise is desirable for him / her.

2.      Reasons for Changing the Present Status

Entrepreneurship being a difficult journey, the obvious question is: What are the reasons that people still become entrepreneurs? Researchers have tried to understand and answer these questions. The researchers report that people generally become entrepreneurs because of economic reasons. These include unemployment, completion of education, dislocation, no or less possibility for career and / or economic prosperity, etc. Nonetheless, the personal dislocation is reported as one of the most powerful reasons galvanizing an individual’s will to become an entrepreneur.

3.      Desire for Change from the Present Status to Become Entrepreneur

Evidences are available to believe that the desire to start one’s own enterprise and, thus, become an entrepreneur by some factors like the culture and family one belongs to and the teachers and peers one comes into contact with. Like elsewhere in the world, there are cultures in India also which place a high value on being entrepreneur. For example, Punjabis and Gujaratis in India represent such cultures which value more on making money, becoming one’s own boss, having more individual opportunities for being successful in career and life. It is, therefore, not surprising to find the more number of enterprises formed by the people belonging to the Punjabis and Gujaratis cultures.

 

 

4.      Possibilities to Become an Entrepreneur

The desire to form an enterprise needs to be present before forming an enterprise, but just desire to form an enterprise cannot make an individual an entrepreneur. Also needed is possibility, better call it supportive and facilitative structure, to form an enterprise. Available literature on entrepreneurship indicates that an individual’s business background, educational background, previous experience, government attitude, availability of finance and market and, of course, one’s role models in business world make it possible to form an enterprise.