CHAPTER THREE

Identification of Opportunities and Institutional Support

System for Small and Medium Enterprises and
Entrepreneurs
Instructor: Sadia Akram Renesa

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Contents
• 1. Opening Case: iCracked
• 2. What Is a Business Opportunity?
• 3. Three Ways to Identify Opportunities
• 4. Preliminary Evaluation
• 5. Institutional Arrangement for Entrepreneurship Development and Institutional Support System
• 6. Entrepreneurship Development Programme (EDP)
• 7. Entrepreneurial Development Cycle
• 8. Summary
• 9. Review Questions

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1. Opening Case: iCracked
In mid-2009, AJ Forsythe, a student at California Polytechnic State University, San Luis Obispo, broke his iPhone
twice within two days. The first time, he dropped it while exiting his car and cracked the screen — an accident
that cost him $200 and an hour’s trip to the Apple Store. A few days later, the same phone broke again when his
roommate casually tossed it to him and it struck a ceiling fan. This time, Forsythe decided to fix it himself: with
help from some engineering students, a small screwdriver, and a dental pick, he replaced the phone’s shattered
screen. Shortly afterwards, his roommate broke his own iPhone too. At that point, Forsythe realised that repairing
iPhones was a promising idea for a business.

To start, Forsythe gave a friend $20 to design a flyer and began putting the flyers up around campus. Within two
weeks, he had his first customer. He set up a Facebook page and a Twitter account to build awareness and
generate sales, and the business — which he named iCracked — began to take shape. Profit margins were good:
at $75 a phone, Forsythe was making about $40 for less than an hour’s work. From the outset, he saw iCracked as
a business that could be replicated on other college campuses. He spent the summer of 2010 in Dallas, his
hometown, pitching the idea to local campuses, and in the fall of 2010 he brought on a partner, Anthony Martin.

Why This Case Matters

iCracked illustrates how a personal problem — repeatedly breaking an iPhone — combined with a chance
discovery (that repair was both feasible and profitable) can be recognised, tested, and scaled into a genuine
business opportunity. It is used throughout this chapter as a reference point for the concepts of opportunity
recognition, internally stimulated ventures, and problem-solving as a source of ideas.

2. What Is a Business Opportunity?

Essentially, entrepreneurs recognise an opportunity and turn it into a successful business. An opportunity is a
favourable set of circumstances that creates a need for a new product, service, or business.

2.1 Externally Stimulated versus Internally Stimulated Ventures

Most entrepreneurial ventures are started in one of two ways:

• Externally stimulated ventures: the entrepreneur first decides to launch a firm, then searches for and
recognises an opportunity, and only then starts the business. Jeff Bezos followed this route when he created
[Link]: in 1994, he quit his lucrative job at a New York City investment firm and headed for Seattle
with a plan to find an attractive opportunity and launch an e-commerce company.
• Internally stimulated ventures: the entrepreneur recognises a problem or an opportunity gap first, and creates
a business specifically to address that problem or fill that gap. iCracked, described above, is an example —
Forsythe did not set out to “start a company” in the abstract; he started with a broken phone and a solution.

2.2 The Four Essential Qualities of an Opportunity

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As illustrated in Figure 2.1 of the reference material, a genuine business opportunity has four essential qualities. It
is:

• Attractive — it appeals to customers and is worth pursuing.

• Timely — the moment is right for it to be introduced.
• Durable — it is not a fleeting fad; it can sustain a business over time.
• Anchored in a product, service, or business that creates or adds value for its buyer or end-user.

2.3 The Window of Opportunity

For an entrepreneur to capitalise on an opportunity, its window of opportunity must be open. The term “window
of opportunity” is a metaphor describing the period during which a firm can realistically enter a new market. Once
the market for a new product is established, its window opens. As the market grows, firms enter and try to
establish a profitable position. At some point the market matures, and the window of opportunity closes.

Example — Internet Search Engines

Yahoo, the first search engine, appeared in 1995, and the market grew quickly with the addition of Lycos, Excite,
and several others. Google entered the market in 1998 with advanced search technology. Since then, the search
engine market has matured, and the window of opportunity for new entrants is far less prominent than it once was.

2.4 A Gap in the Market

A gap in the market is an opportunity to make and sell something that is not yet available but that consumers
would like to have. The “gap” refers to the difference between the supply of, and demand for, a product — in
other words, a consumer need that supply has not yet met.

2.5 Idea versus Opportunity

Understanding the distinction between an opportunity and an idea is another key issue. A thought, an impression,
or a notion is an idea. This distinction matters because many entrepreneurial ventures fail not for lack of effort by
their founders, but because there was no true opportunity to begin with. Understanding whether a company
concept serves a genuine need — and therefore qualifies as an opportunity — is essential before an entrepreneur
becomes enthusiastic about it and commits resources to it.

3. Three Ways to Identify Opportunities

There are three broad approaches entrepreneurs use to identify an opportunity for a new venture (Figure 2.2 of the
reference material): observing trends, solving a problem, and finding gaps in the marketplace. Understanding the
importance of each approach makes an entrepreneur far more likely to notice opportunities and ideas that fit each
profile.

3.1 Observing Trends

The first approach to identifying opportunities is to observe trends and study how they create openings for
entrepreneurs. The most important trends to follow are economic trends, social trends, technological advances,

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and political action and regulatory changes (Figure 2.3). Entrepreneurs can study each of these factors to help spot
business, product, and service opportunity gaps.

(a) Economic Forces

When the economy is doing well, individuals have more money to spend and are eager to purchase luxuries that
improve their lives. When the economy is poor, people not only have less money to spend but also become more
reluctant to spend what they have, fearing that conditions might worsen and that they might lose their jobs.
Paradoxically, a poor economy also opens doors for start-ups that save consumers and companies money.

Example — WaterSmart Software

WaterSmart Software, a 2009 start-up, provides water utilities with software that makes it easier for their
customers to conserve water and save money — a business idea that gained traction precisely because a tougher
economy made cost-saving solutions more attractive.

When studying how economic forces affect business opportunities, it is important to evaluate who has money to
spend and what they spend it on. For example, an increase in the number of women in the workforce, and the
related rise in their disposable income, is largely responsible for the growth in online retailers and boutique
clothing stores that specifically target professional women.

(b) Social Forces

Changes in social trends alter how people and businesses behave and how they set their priorities. These changes,
in turn, affect how products and services are designed and sold. Social trends currently affecting individual
behaviour and priorities include:

• Aging of the population

• Increasing diversity of the workforce
• Increased participation in social networks
• Growth in the use of mobile devices
• An increasing focus on health and wellness
• Emphasis on clean forms of energy, including wind, solar, and biofuels
• Continual migration of people from small towns and rural areas to cities
• Desire for personalisation — creating a need for products and services people can tailor to their own tastes
and needs

(c) Technological Forces

Advances in technology frequently combine with economic and social changes to create new opportunities. For
example, there is significant overlap between the growing focus on health and wellness and advances in
technology.

Example — Wearable Fitness Devices

Wearable devices such as the Fitbit Flex and the Jawbone Up help people maintain a healthy lifestyle by
monitoring their movement and sleep — a direct product of technological advances meeting a social trend toward
health-consciousness.

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(d) Political Action and Regulatory Forces
Political and regulatory changes also provide the basis for new business ideas. New laws often spur start-ups
launched specifically to take advantage of their provisions.

Example — Electronic Medical Records

The combination of new healthcare regulations, incentives for doctors and hospitals to shift to electronic records,
and the release of large volumes of data by the Department of Health and Human Services (on topics such as
hospital quality and nursing-home patient satisfaction) motivated entrepreneurs to launch electronic-medical-
records start-ups, medication-monitoring apps, and similar companies.

3.2 Solving a Problem

The second approach to identifying opportunities is to recognise problems and find ways to solve them. Problems
can be recognised by observing the challenges people encounter in daily life, and also through simpler means
such as intuition, serendipity, or chance. Many pressing problems remain unsolved — for instance, finding
alternatives to fossil fuels is one of the most pressing challenges facing many countries, and a large number of
entrepreneurial firms have been launched to take it on, including firms pursuing wind-generated energy.

Example — GreatCall’s Jitterbug

Advances in technology often create problems for people who cannot use that technology the way it is marketed to
the masses. Some older people find traditional cell phones hard to use: the buttons are small, the text is hard to
read, and it can be difficult to hear someone in a noisy room. To solve this problem, GreatCall, Inc. produces the
Jitterbug, a cell phone designed specifically for older users, featuring a large keypad for easy dialling, powerful
speakers for clear sound, easy-to-read text, and simple text-messaging capability.

3.3 Finding a Gap in the Marketplace

Gaps in the marketplace are the third source of business opportunities. Many products that consumers need or
want are simply not available in a particular location, or are not available at all. Part of this problem is created by
large retailers such as Wal-Mart and Costco, which compete primarily on price and stock the most popular items
aimed at mainstream consumers. While this approach allows large retailers to achieve economies of scale, it
leaves gaps in the marketplace — which is precisely why clothing boutiques, specialty shops, and e-commerce
websites exist: they are willing to carry merchandise that does not sell in large enough quantities for the big
retailers to stock.

Examples — Daisy Rock Guitars and Southpaw Guitars

Tish Ciravolo, a Los Angeles–based bass guitarist and guitar designer, realised that no guitars on the market
were made specifically for women. To fill this gap, she founded Daisy Rock Guitars — stylish instruments that
come in feminine colours and incorporate design features suited to a woman’s smaller hand and build, and she
serves as its president. In a related example, Southpaw Guitars, located in Houston, Texas, carries only guitars
designed and produced for left-handed players.

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4. Preliminary Evaluation
Once a range of ideas has been generated, the entrepreneur must prepare a list of investment opportunities
identified from various sources. These project ideas are analysed while taking government regulations into
account, in order to finalise a set of feasible investment opportunities. Because a project idea cannot be appraised
in full detail at this early stage, investment opportunities are evaluated against a set of specific criteria to select
those project ideas that are commercially feasible.

4.1 The Six Screening Criteria

The criteria used in preliminary evaluation are:

1. Is it compatible with the promoter?

2. Is it compatible with government regulations and priorities?
3. Whether raw materials are easily available.
4. What is the size of the potential market?
5. Whether the cost justifies the project.
6. What is the risk inherent in the project?

4.2 Explanation of Each Criterion

(1) Compatibility with the Promoter
The entrepreneur must ensure that the project undertaken is compatible with the financial and human resources
available at his or her disposal.

(2) Compatibility with Government Regulations and Priorities

The project undertaken by the entrepreneur should not violate government regulations and priorities.

(3) Availability of Raw Materials

The availability of raw materials, and the cost of obtaining them, are important factors to be taken into account
when selecting the project.

(4) Potential Market

This criterion covers the existing and potential demand in domestic and export markets, consumption trends, the
nature of competition, competitors’ market shares, the availability of substitutes, entry barriers, the possibility of
substitutes entering the market, and technological developments taking place within the industry.

(5) Cost of the Project

The cost of the project should be reasonable, in the sense that a desired profit margin can be realised from a
competitive price.

(6) Risk Inherent in the Project

Every project is subject to risks such as changes in demand, technological developments, the entry of substitutes,
competition, and cyclical or seasonal variations. “Business Entrepreneurs,” a special supplement to “The Week,”

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offers additional guidance regarding the selection and marketing of a product or service based on these
considerations.

5. Institutional Arrangement for Entrepreneurship Development and

Institutional Support System
A number of institutions in Bangladesh provide arrangement and support for entrepreneurship development. This
section covers four of the most significant: BRAC, BSCIC, MIDAS, and the SME Foundation.

5.1 BRAC
Overview and History
BRAC started in 1972 as a small relief and rehabilitation effort to support Bangladeshi refugees returning home
after the declaration of independence in December 1971. At that time, it stood for Bangladesh Rural Assistance
Committee. By the mid-1970s, BRAC realised that more long-term, sustained effort was needed to change the
lives of the poor. Its focus shifted from rehabilitation to development, and it was renamed Bangladesh Rural
Advancement Committee.

BRAC’s Main Programs

• BRAC Development Program (BDP)
• BRAC Education Program (BEP)
• Health, Nutrition & Population Program (HNPP)
• BRAC Training Division (BTD)
• Research and Evaluation Division (RED)
• Support Programs and Enterprises
• Other related institutions: BRAC University, BRAC Bank

Economic Development — Microfinance and Aarong

Microfinance, introduced in 1974, is BRAC’s oldest programme. It provides collateral-free loans to mostly poor,
landless, rural women, enabling them to generate income and improve their standard of living. BRAC’s
microcredit programme funded over $1.9 billion in loans in its first 40 years, and 95% of BRAC’s microloan
customers are women. BRAC started its community-empowerment programme across the country in 1988, and
founded its retail outlet, Aarong (Bengali for “village fair”), in 1978 to market and distribute products made by
indigenous artisans. Aarong services about 65,000 artisans and sells gold and silver jewellery, hand loom
products, leather crafts, and more.

Microcredit is the extension of very small loans (microloans) to impoverished borrowers who typically lack
collateral, steady employment, or a verifiable credit history. It is designed to support entrepreneurship and
alleviate poverty; many recipients are illiterate and therefore unable to complete the paperwork required for
conventional loans. As of 2009, an estimated 74 million people held microloans totalling US$38 billion, and
Grameen Bank reports repayment success rates between 95 and 98 percent.

Economic Development — Poultry, Sericulture, Fishery, and Agriculture

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Poultry & Livestock Program: In 1970, BRAC identified poultry as a potential source of income for poor women
and started the poultry programme, which comprises a poultry and livestock extension programme, poultry farms
and hatcheries, feed mills and feed-analysis laboratories, a bull station, and disease-diagnosis laboratories.

Sericulture: In 1978, BRAC started its sericulture programme as part of the Manikganj Integrated Project under its
rural development programme, aiming to provide income-generating activity and employment for poor, landless
women. The programme spans all stages, from planting mulberry trees and rearing silkworms to producing and
dyeing the finished silk product.

Fishery: The BRAC Fisheries Program began in 1976 to generate income for rural farmers, with a focus on pond
culturing across hatcheries, nurseries, and culturing activities. Aquaculture activities have been extended to cover
277,000 households and 180,000 ponds.

Agriculture Extension Program and Agro-Forestry: This programme was started to increase agricultural
production through technology transfer relating to vegetable cultivation and crop diversification (rice, maize,
wheat, cotton, and sunflower). BRAC has also established a modern soil-testing laboratory, and since 1996 has
produced high-quality seeds for distribution to farmers through 23 seed production and processing centres. In
2007, 27,000 pounds of vegetables and about 1,674,000 tons of potatoes were exported.

5.2 BSCIC
Overview
The Bangladesh Small and Cottage Industries Corporation (বিসিক / BSCIC) provides support services to
small, rural, and cottage industry in Bangladesh. It was created through an Act of Parliament in 1957, later
amended in 1992. BSCIC has a country-wide institutional network that provides doorstep services for
entrepreneurs; its head office is located at 137–138 Motijheel, Dhaka.

History
BSCIC traces its origins to the East Pakistan Small and Cottage Industries Corporation, established through the
East Pakistan Small and Cottage Industries Corporation Act, 1957. The Act was created by Sheikh Mujibur
Rahman, then Minister for Labour, Commerce and Industry in the United Front government of East Pakistan.
After the independence of Bangladesh, it was reconstituted as BSCIC. In October 1973, BSCIC was split into the
Bangladesh Cottage Industries Corporation and the Bangladesh Small Industries Corporation. In 1975, the
Bangladesh Handloom Board and the Bangladesh Sericulture Board were separated from BSCIC.

Functions of BSCIC
BSCIC provides medium- and long-term loans to small industries, either directly or through a consortium of
commercial banks. It also provides assistance in all other matters relating to the development and expansion of
small and cottage industries (SCI), and is the official body monitoring the development of self-employment,
cottage industries, and small enterprises. It produces statistics on the types of enterprises, their activities, and the
number of people they employ. Its major functions include:

• Promotion and registration of small and cottage industries

• Conducting advisory and industrial-promotion services, including entrepreneur training
• Skill development for artisans and craftsmen

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 • Creation of jobs for small and cottage industries
• Construction and development of industrial estates with necessary infrastructural facilities for SCIs
• Development of linkages between SCIs and large and medium-sized industries
• Online services for registration of industry, application for industrial plots, and application for training
facilities (planned)

5.3 MIDAS — Micro Industries Development Assistance and Services

MIDAS is a not-for-profit organisation established in 1982 with USAID assistance to address the challenge of
poverty alleviation in a practical way. Its main focus is creating employment opportunities by promoting the
development of Micro, Small and Medium Enterprises (MSME). It has helped many individuals with limited
resources start small businesses and contribute to innovation and competition.

Vision: To stand out as a front-line business development service provider in Bangladesh.

Mission: To help generate employment, reduce poverty, and promote socio-economic development.

Objectives of MIDAS
MIDAS is committed to developing a sound and rapidly growing micro, small, and medium enterprise sector in
Bangladesh. Accordingly, it aims to:

• Identify promising micro, small, and medium-scale enterprises by providing financial, managerial, and
technical assistance
• Develop entrepreneurship and help entrepreneurs explore and exploit new business opportunities
• Facilitate capacity building of micro, small, and medium enterprise promotion organisations
• Serve as a catalytic force for the growth of micro, small, and medium-scale business enterprises in the
country
• Continuously develop its institutional capability to operate on a self-sustaining basis

Core Services of MIDAS

1. Study and research
2. Human resource development
3. Private-sector development
4. Information and counselling
5. Project implementation, monitoring & evaluation
6. Marketing assistance for women entrepreneurs

5.4 SME Foundation (SMEF)

The Small and Medium Enterprise Foundation (SMEF) was established by the Government of Bangladesh
through the Ministry of Industries, in line with the SME Policy 2019, National Industrial Policy 2016, the 8th Five
Year Plan, Vision 2021, SDG 2030, and Vision 2041. SMEF was established in 2007 with an initial fund of 2
billion taka. The first SME Policy was formulated in 2005 with a view to creating an enabling environment for the
development of the SME sector.

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SMEF implements multifaceted activities, including business support services and market-linkage support for
SMEs; improving access to institutional finance for SMEs; designing and implementing development
interventions for SME clusters; identifying the problems and prospects of SMEs through research; and
strengthening the regulatory and legislative framework in favour of SMEs. It also promotes the upgrading and
adoption of appropriate technologies, increases SME business efficiency through ICT-based tools, provides
capacity-building training to develop adequate human resources for SMEs, and assists women entrepreneurs. One
of SMEF’s major areas of focus is cluster-based SME development. Professor Dr. Md. Masudur Rahman is the
current chairman of the SME Foundation.

Objectives of SMEF
1. Implementing the SME Policy Strategy adopted by the Government of Bangladesh.
2. Recommending SME-friendly policies to different government ministries and agencies.
3. Providing business support services to SME entrepreneurs.
4. Providing information and proper guidance for establishing new SMEs.
5. Conducting sectoral studies to ensure the availability of the latest information, identify challenges, and
recommend preventive measures — recognising that SMEs face challenges from limited access to finance,
lack of databases, low R&D expenditure, undeveloped sales channels, and low financial inclusion.
6. Operating credit-wholesaling programmes for SMEs through different banking and non-banking financial
institutions.
7. Conducting training programmes to create skilled labour for different SME sub-sectors based on demand.
8. Supporting technology development, adopting new technology, conducting reverse engineering, and helping
SMEs obtain quality certifications.
9. Supporting SMEs in marketing their products and promoting their services — for example, through trade
shows, direct marketing, social media, and SEO.
10. Bringing women entrepreneurs into the mainstream of development and helping them achieve economic
self-dependency. (Women constitute over 10 percent of total entrepreneurs in Bangladesh, and many have
excelled particularly in the handicrafts sector and in SMEs more broadly.)
11. Assisting SMEs in building institutional relationships with foreign companies for capacity building,
technology transfer, and improved productivity.
12. Training and motivating SMEs in using ICT tools to improve productivity and quality — including
enhancing customer communication and enabling owners to focus on core business rather than daily
administrative chores.

6. Entrepreneurship Development Programme (EDP)

6.1 Meaning
An Entrepreneurship Development Programme (EDP) is a training programme meant to develop entrepreneurial
abilities among people. In other words, it refers to the development and polishing of the entrepreneurial skills a
person needs to establish and successfully run an enterprise. The concept therefore involves equipping a person
with the skills and knowledge required to start and run a business. An EDP is designed to help an individual
strengthen their entrepreneurial motive and acquire the skills and capabilities necessary to play their

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entrepreneurial role effectively; this requires promoting an understanding of motives and their impact on
entrepreneurial values and behaviour.

6.2 Objectives of EDPs

The major objectives of EDPs are to help a participant:

• Develop and strengthen entrepreneurial quality, motivation, or the need for achievement
• Analyse the environmental set-up relating to small industry and small business
• Select the product
• Formulate a proposal for the product
• Understand the process and procedure involved in setting up a small enterprise
• Know the sources of help and support available for starting a small-scale industry
• Acquire the managerial skills necessary to run a small-scale industry
• Appreciate the entrepreneurial discipline needed
• Know the pros and cons of becoming an entrepreneur
• Prepare to accept the uncertainty involved in running a business
• Take decisions effectively
• Communicate clearly and effectively
• Develop a broad vision about the business
• Subscribe to industrial democracy
• Develop a passion for integrity and honesty
• Learn compliance with the law

6.3 Course Content and Curriculum of EDPs

1. General Introduction to Entrepreneurship
Participants are first exposed to general knowledge of entrepreneurship, such as the 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
This input aims to induce and develop the need for achievement among participants — a crucial component of
entrepreneurship training. Efforts are made to inject confidence and a positive attitude and behaviour toward
business, with the ultimate aim of encouraging participants to start their own enterprise after completing the
programme. Successful entrepreneurs are sometimes invited to speak about their experiences in setting up and
running a business, to further motivate participants.

3. Management Skills
Running a business, large or small, requires managerial skills. Because a small entrepreneur cannot usually
employ management professionals or experts, they need to learn basic, essential managerial skills across the
functional areas of management — finance, marketing, human resources, and production. Knowledge of these
skills enables an entrepreneur to run their enterprise smoothly and successfully.
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4. Support System and Procedure
Participants also need to be exposed to the support available from different institutions and agencies for setting up
and running small-scale enterprises, followed by familiarisation with the procedures for approaching, applying to,
and obtaining support from them.

5. Fundamentals of Project Feasibility Study

Participants are given guidelines for effectively analysing the feasibility or viability of a particular project across
its marketing, organisational, technical, financial, and social aspects. They are also taught how to prepare a project
or feasibility report for particular products.

6. Plant Visits
Plant visits are arranged to familiarise participants with real-life situations in small business. Such trips help
participants learn more about an entrepreneur’s behaviour, personality, thoughts, and aspirations — knowledge
that influences how the participant will behave in order to run their own enterprise smoothly and successfully.

6.4 Phases of EDPs

An Entrepreneurship Development Programme consists of three phases: the pre-training phase, the training phase,
and the post-training (follow-up) phase.

1. Pre-training Phase
This phase covers the activities and preparations required to launch the training programme, including:

• Selection of entrepreneurs
• Arrangement of infrastructure
• Tie-up of guest faculty for training purposes
• Arrangement for inauguration of the programme
• Selection of the necessary tools and techniques to select suitable entrepreneurs
• Formation of a Selection Committee for choosing trainees
• Arrangement of publicity media and campaigning for the programme
• Development of the application form
• Finalisation of the training syllabus
• Pre-potential survey of opportunities available in the given environmental conditions

2. Training Phase
The main objective of this phase is to bring about a desirable change in the behaviour of the trainees — in other
words, to develop the ‘need for achievement’, or motivation, among them. A trainer should look for the following
changes in trainee behaviour:

• Is the trainee attitudinally tuned toward their proposed project idea?

• Is the trainee motivated to pursue an entrepreneurial career and bear the risks involved?
• Is there a perceptible change in their entrepreneurial attitude, outlook, skill, and role?
• How should the trainee behave like an entrepreneur?

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 • What entrepreneurial traits does the trainee lack the most?
• Does the trainee possess knowledge of technology, resources, and other entrepreneurship-related
knowledge?
• Does the trainee possess the required skill in selecting a viable project and mobilising the required resources
at the right time?
These questions also underpin the basic assumptions used in designing a suitable training programme for potential
entrepreneurs. After training, the trainers must ask themselves how much, and how far, the trainees have
progressed in their entrepreneurial pursuits.

3. Post-training Phase (Follow-up)

The ultimate objective of an EDP is to prepare participants to start their own enterprises. This phase, therefore,
involves an assessment of how far the objectives of the programme have been achieved — referred to as ‘follow-
up’. Follow-up reviews past work and suggests guidelines for framing future policies to improve performance. In
short, the purpose of EDP follow-up is to:

• Review the pre-training work

• Review the process of the training programme
• Review the past training approach

6.5 Evaluation of EDPs

EDPs can be considered an effective instrument for developing entrepreneurship, and their main objective is held
to be enterprise creation. It is therefore necessary to determine whether this objective has been fulfilled — in other
words, to take a retrospective look at how many participants actually started their own enterprises after
completing the training. This calls for evaluation of EDPs. Behavioural scientists use the following criteria to
assess the effectiveness of EDPs in motivating entrepreneurs:

• Activity level of the respondents

• New enterprises established
• Total investment made
• Investment in fixed assets made
• Number of people employed
• Number of jobs created
• Increase in profit
• Increase in sales
• Quality of product/service improved
• Quicker repayment of loans

6.6 Problems Faced by EDPs

Different studies evaluating EDPs have highlighted several recurring issues. These problems arise on the part of
participants and at various steps of the process — involving trainers and trainees, the ED organisation, supporting
organisations, and government bodies. The important problems EDPs face include:

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 • Trainer-motivators are not always found to be up to the mark in motivating trainees to start their own
enterprises.
• ED organisations sometimes lack commitment and sincerity in conducting EDPs; in some cases, EDPs are
used merely as a means of generating surplus income for the ED organisation.
• A non-conducive environment and various constraints make the trainer-motivators’ role ineffective.
• The lukewarm or even antithetic attitude of supporting agencies, such as banks and financial institutions,
serves as a stumbling block to the success of EDPs.
• Selection of the wrong trainees also leads to a low success rate for EDPs.

7. Entrepreneurial Development Cycle

The entrepreneurial development cycle is the combination of all support activities and assistance conducted and
provided continuously for the development of entrepreneurship. It generates entrepreneurial awareness in the
community through well-planned publicity, and is generally described as consisting of three linked stages:
Stimulating, Support, and Sustaining.

7.1 Stimulating Factors

• Entrepreneurial education — seeks to provide students with the knowledge, skills, and motivation to
encourage entrepreneurial success in a variety of settings, offered from primary/secondary schools through
graduate university programmes.
• Planned publicity for entrepreneurial opportunities — media attention for an entrepreneur’s product, service,
or business, through traditional news sources as well as blogs and websites, which raises awareness and can
often be generated for free.
• Identification of potential entrepreneurs through scientific methods — for example, quantitative instruments
measuring predictors such as access to entrepreneurial role models, urgency of entrepreneurial intent, and
desire for economic autonomy.
• Motivational training for new entrepreneurs — besides increasing the need for achievement among potential
entrepreneurs, this also helps them develop coping ability, tolerance for ambiguity, and influencing
capability.
• Help and guidance in selecting products and preparing project reports.
• Making available techno-economic information and product profiles — techno-economic assessment (TEA)
analyses the economic performance of an industrial process, product, or service, typically using software
modelling to estimate capital cost, operating cost, and revenue.
• Evolving locally suitable new products and processes.
• Availability of local agencies with trained personnel for entrepreneurial counselling and promotion —
government should, as much as possible, expand staff dedicated to proper counselling and promotional
activities for new entrepreneurs.
• Organising entrepreneurial forums — bringing together like-minded business owners to share experience
and help each other grow their companies faster.

7.2 Support Factors

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 • Registration of the unit
• Arranging finance
• Providing land, shed, power, water, etc.
• Guidance for selecting and obtaining machinery
• Supply of scarce raw materials
• Obtaining licences / import licences
• Providing common facilities
• Granting tax relief or other subsidy
• Offering management consultancy
• Helping to market the product

7.3 Sustaining Factors

• Help with modernisation
• Help with diversification, expansion, or substitute production
• Deferring repayment or interest
• Diagnostic industrial extension / consultancy support
• Production-unit legislation / policy change
• Product reservation, or creating new avenues for marketing
• Quality testing and improvement services
• Need-based common facilities centre

8. Summary
• A business opportunity is a favourable set of circumstances creating a need for a new product, service, or
business; ventures may be externally stimulated (opportunity sought after deciding to start a firm) or
internally stimulated (opportunity recognised first, as with iCracked).
• A genuine opportunity is attractive, timely, durable, and anchored in real value creation — and it must be
captured while its ‘window of opportunity’ remains open.
• Entrepreneurs identify opportunities in three main ways: observing trends (economic, social, technological,
political/regulatory), solving problems, and finding gaps in the marketplace.
• Preliminary evaluation screens ideas against six criteria: compatibility with the promoter, compatibility with
government regulations, availability of raw materials, potential market size, project cost, and inherent risk.
• In Bangladesh, BRAC, BSCIC, MIDAS, and the SME Foundation form key pillars of the institutional
arrangement and support system for entrepreneurship development.
• EDPs aim to build entrepreneurial motivation and managerial skill through a curriculum covering general
introduction, motivation training, management skills, support systems, feasibility-study fundamentals, and
plant visits, delivered across pre-training, training, and post-training/follow-up phases.

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• EDPs are evaluated against measurable outcomes such as new enterprises established, employment
generated, and increases in sales and profit — and commonly face problems such as weak trainer motivation,
poor institutional commitment, and wrong selection of trainees.
• The entrepreneurial development cycle links stimulating, support, and sustaining factors into a continuous
system that nurtures entrepreneurship from initial awareness through to the growth of an established
enterprise.

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