Module II

Entrepreneurial values and attitudes

A value is stable long-lasting belief about what is important to a person. The

values become standards by which people order their lives and make their
choices.

The core values are the fundamental belief of a person or organisation. The core
values are the guiding principles that dictate behaviour and action. Core values
can help people to know what is right from wrong; they can help companies to
determine if they are on the right path and fulfilling their business goals; and
they create an unwavering and unchanging guide. While some people or
companies might expressly publish their core values, often the best way to
identify these values is to which how they act or behave. A core value is only a
true core value if it has an active influence and if the people or company
manage to live by it, at least most of the time.

An attitude is the mental disposition people have towards others and the current
circumstances before making decisions that result in behaviour. People
primarily form their attitudes from underlying values and belief.

Entrepreneurship is all about having the core values and the right attitude that
changes the outlook towards the chosen career and its impact on the personal,
professional and social aspect of life. What makes an entrepreneur different
from others is a firm belief in themselves and a habit of challenging the status
quo.

Dominant characteristics of successful entrepreneurs

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1. Desire or Urge to Achieve

2. Retain Motivation towards Achievement

3. Leadership Quality

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4. Risk Bearing Capacity

5. Convert Dreams into a Concrete Action Plan

6. Possess High Level of Energy

7. Technical Knowledge

8. Work in Uncertain Conditions

9. Decision Maker

10. Innovator

11. Sense of Efficacy

12. Goal Oriented

13. Hard Work

14. Highly Optimistic

15. A Good Organising Ability

16. Seizing Opportunities

17. Dedication and Devotion

18. Dynamism

19. Self-Motivation

20. Persistent Problem-Solver and a Few Others.

What makes an entrepreneur successful? Is there anything common in the

personal characteristics of the entrepreneurs? In an endeavour two answer these
questions we need to understand the characteristics of an entrepreneur. There
have been sufficient studies to trace the common characteristics of the
entrepreneurs.

Here, we shall try to enlist few entrepreneurial characteristics:

1. Desire or Urge to Achieve: An entrepreneur must have an inherent urge to

achieve the desired goals. McClelland found that people with a high need for
achievement perform better. The “n Ach” people are achievement motivated and

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look forward to attain challenging goals and achieve marvelous achievements in
their endeavours.

2. Retain Motivation towards Achievement: A successful entrepreneur must

retain the strong motivation level towards the achievement of a task. There may
be obstacles and hindrances, but an entrepreneur must keep himself/ herself
motivated even at the difficult times.

3. Leadership Quality: An entrepreneur ought to be a good leader. The

entrepreneur has to bring all the factors of productions into a single platform.
He/she should be able to lead the workers successfully.

4. Risk Bearing Capacity: An entrepreneur makes his move under uncertainty.

The entrepreneur should be willing to bear risk. The entrepreneur takes
moderate risks. He is not a gambler. In the entire process of establishing an
enterprise, the entrepreneur bears the uncertainty involved in the enterprise. The
entrepreneur undertakes the responsibility of bearing the losses that may arise
on account of new ideas and projects undertaken by him/her.

5. Decision Maker: An entrepreneur is expected to be very good in decision

making. Every phase in entrepreneurship needs proper decision making. The
decision making ability of the entrepreneur helps in solving many problems.

6. Innovator: An innovating mind is an inherent characteristic of a successful

entrepreneur. An entrepreneur introduces new technology in production;
discover new products, source of raw materials, and new markets. The
entrepreneur as an innovator comes up with new ideas, products, services,
methods in order to meet the ever changing needs of consumers most
successfully. The entrepreneur has a profound influence on the level of business
activities.

7. Goal Oriented:

An entrepreneur should be highly goal-oriented. An entrepreneur must be able

to set realistic but challenging goals for him as well as for others in the
organisation.

8. Desire to own Responsibility: An entrepreneur must be able to own

responsibility .The entrepreneur must have a sense of personal responsibility for
the outcome of the initiatives that he/she takes while pursuing his/her
entrepreneurial pursuit.

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9. Organizing Skill: An entrepreneur must be able to mobilize the available
resources in an efficient manner. The entrepreneur must be able to organize all
the factors of production. The entrepreneur should be able to allocate the
appropriate worker for a task to be accomplished. Effectively combining
manpower and jobs would enable the entrepreneur to be successful.

10. Work in Uncertain Conditions: All entrepreneurial endeavours are shrouded

with uncertainty. The entrepreneur must possess the guts to work in this
uncertain environment. The ability to handle uncertainty is the key to success

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12. Communication Skill: An entrepreneur is expected to possess a high level of

communication skill. The entrepreneur needs to efficiently communicate with
all the concerned business partners. He/ She must be able to communicate his/
her views and ideas to the employees, customers, suppliers, and financiers.

13. High Level of Commitment and Dedication: An entrepreneur must be highly

dedicated and committed towards his task. Beginning a enterprise successfully
requires total commitment from an entrepreneur.

14. Possess High Level of Energy: An entrepreneur has to be energetic.

Organizing resources and coordinating all the factors of production requires
long hours of work and therefore, an entrepreneur should possess high level of
energy.

15. Technical Knowledge: An entrepreneur is expected to have a reasonable

level of technical knowledge. The entrepreneur should be aware of the latest
technology available. The technical knowhow allows the entrepreneur to
appreciate and understand changes in the technological environment. The
entrepreneur can bring about required technological up gradation or changes.

Technical knowledge is an inevitable prerequisite for a normal entrepreneur to

bring about innovation in the technology used in the production process.

16. Analytical Mind and High Mental Ability: An entrepreneur should bear an
analytical mind in order take pragmatic and realistic decisions. He/she should be
able to analyze various problems and situations associated with the enterprise.

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Moreover, the entrepreneur should not have a prejudiced mind, but should
deploy his/her analytical mind to solve all the issues.

17. Flexibility: The business environment is very dynamic. There are often
changes which could be detrimental for an enterprise. A true entrepreneur
should be able to adapt to the changes in the business environment. Rigidity and
inertia to change could be fatal. There may be changes in demand conditions,
supply conditions, government policies, global business environment .The
successful entrepreneur is very flexible in his/her approach and deals with the
changes with great caution. The entrepreneur should be ready to change the
strategies whenever necessary.

18. Willing to Learn from Feedback: A successful entrepreneur likes to receive

feedback of his/her performance. The feedback allows the entrepreneur to
decide his/her future course of action.

19. Self-Confidence: An entrepreneur must have self-confidence to successfully

complete the business endeavour. Self-confidence helps the entrepreneur to tide
over all the problems associated with his/her entrepreneurial pursuit.

20. Perseverance: An entrepreneur must be perseverant. He /she may face

failures. But the entrepreneur should never bow down. He/ she should change
the strategy and try again and again to materialize his/her vision into reality. An
entrepreneur should never quit till the project is successfully completed.

It is prudent for an aspiring entrepreneur to understand the different

characteristics of an entrepreneur. The potential entrepreneur should take stock
of what might be lacking and acquire those skills through training.

Entrepreneurial Motivating Factors: Internal and External Factors

A. Factors Internal to the entrepreneur:
➢ Strong desire to do something independent life

➢ Technical knowledge and/or manufacturing experience

➢ Business experience in the same or related line.

B. Factors External to the entrepreneur:

➢ Financial assistance from institutional sources

➢ Accommodation in industrial estates

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 ➢ Machinery: hire or purchase

➢ Attitude of the government to help a new venture

➢ Financial assistance from non-government sources

➢ Encouragement from big business

➢ Heavy demand

➢ Profit margin

➢ Unsound units available at a cheap price

Entrepreneurial skills

Entrepreneurial skills consist of hard skills and soft skills. Hard skills fall under
the category of technical skills and are demonstrated through concrete and
measurable tasks, like completing a financial report. They can be improved
through education and hands-on experience.
Entrepreneur soft skills consist of communication and leadership attributes that
can include organization and teamwork. These skills are applicable to all
professions and are valued in any job or industry. Other granular skills within
these two sets of skills include leadership, industry knowledge and management
capabilities.
While numerous skills can help you become successful, we have narrowed it to
13 entrepreneur skills recognized as important for success. This list incorporates
both hard skills and soft skills. As organizations and businesses continue to
evolve, having a diverse set of skills will help you successfully navigate the
possible changes within any industry.

1) Technical skills: an entrepreneur must have a reasonable level of

technical knowledge. He should be proficient in the use of specialised
information, methods, processes, procedures and techniques involved in
the technology of the product or services of the industry or company.

2) Behavioural skills: utilization of knowledge to understand people. It

requires an awareness of attitudes and beliefs held by individuals and
groups and how these govern their goal reaching processes

3) Conceptual skills: an entrepreneur should have the ability to utilise the

existing knowledge in order to acquire additional knowledge. It is the
purposeful risk taking for creating new conditions. These skills are

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 interdisciplinary in which various functions of systems depend on others
systems as well as the way changes in any other part affect all the others.

4) Economic-business skills: utilization of knowledge to understand a

business enterprise operating in a market for the sale of goods and
services. It involves use of scarce and limited resources to meet changing
and unpredictable demands, the strategy of production, distribution and
consumption of goods and services with minimisation of output and
minimisation of input

5) Implementing skills: ability to get the work done on a day-to-day,

program-to-program basis or the ability to concentrate on availability of
resources of time, money and manpower to initiate an activity, conduct
the activity and bring it to a successful end.

6) Strategic skills: an entrepreneur must have a vision for the future. He/she
must be able to see the bigger picture and know where he/she is going
with everything. Setting clear objectives and effective strategies are
essential for running a business successfully.

7) Financial skills: The ability to handle resources, assess investments,

calculate ROI is a must for entrepreneurs. Apart from this, they must
know how to use accounting and budgeting software to keep track of all
the financial processes. By learning financial skills, entrepreneurs avoid
overspending and optimally allocate resources.

8) Business management skills: Business management skills are traits an

entrepreneur must have to run a business and ensure all business goals are
met. Entrepreneurs with this skill set can oversee and manage operations
of different departments because they possess a good understanding of
each function. Business management skills include multitasking,
delegating responsibilities and making critical business decisions.

9) Human relations skills: the success or failure of an entrepreneur depends

on the maintenance of public relations or human relations. The most
important skill contributing to his success are the personal relations,
stability, consideration and tactfulness. In order to achieve higher
productivity and efficiency he must maintain good relations with his
employees.

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 10)Communication skills: Every entrepreneur must be able to communicate
effectively with clients, team members and all other stakeholders.
Whether through verbal communication during meetings or sending
reports and messages through emails about the project, entrepreneurs
require superior written and verbal communication. Apart from
communication skills, entrepreneurs must be excellent listeners to
understand the project's requirement and discussion during project
meetings.

11)Diagnostic skills: the skill is used to measure risk. It gives an idea as to

how to go about planning and developing. It consists of two parts-
technical diagnosis and commercial diagnosis. The technical diagnosis
consist of evaluating two dimensions of risk, i.e. risk related to
technology and the risk related to technological environment. The
commercial diagnosis consists of assessing the dimensions of risk: the
advantages and shortcomings of the company and the market appeal and
constraints.

12)Project development skills: the entrepreneur should have the skill to

make a suitable and proper selection of the project which will give him
reasonable returns. It is said well began is half done, therefore if the
project is selected with due care and developed in the right way it could
achieve sure success.

13)Marketing skills: modern marketing considers the creation as customers

as the purpose of marketing. It is a broad concept with stress on consumer
satisfaction and social welfare. Special attention is to be given towards
different social groups. Therefore an entrepreneur should possess selling
skills which will produce revenue for the project to succeed.

In today’s economy, technical and business skills are not enough to operate a
business. Entrepreneurial skills are also required to anticipate changes, identify
opportunities and create high-performance working environment according to
the realities demanded by global competition. The development of
entrepreneurship amongst engineers and general graduates is going to be an
effective mechanism for entrepreneur is one who has strong determination, with
sound thinking, strong willpower with 100% commitment and 200%
involvement. It is the determination that provides the entrepreneur energy to
work for 14-18 hours a day, 7 days a week and 365 days in a year, till his unit
reaches a natural stage of take-off.
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Identifying a business opportunity

For the potential entrepreneur the first task is to identify, explore and then select
an attractive business opportunity

Opportunity:

An opportunity may be defined as an attractive project idea, which an

entrepreneur accepts as a basis for his investment decision.

Good business ideas must be capable of being converted into feasible projects.
Two major ingredients of a business opportunity need to be highlighted. Good
market scope i.e. gaps between present or likely demand and supply and an
attractive or acceptable return on investment.

Apart from these two criteria a business opportunity needs to be analysed from
the other viewpoints for its viability such as technical, production, commercial
and management. These criteria are inter-linked and a decision about one affects
the other.

Preliminary evaluation:

The entrepreneur has to prepare a list of investment opportunities identified

from various sources. These project ideas are analysed by taking into account
government regulations for finalising a set of feasible investment opportunities.
Since the project idea cannot be appraised in detail the investment opportunities
are evaluated against a set of specific criteria which are mentioned below;

Compatible with the promoter: The entrepreneur must see that the project
undertaken should be compatible with the financial and human resources
available at his disposal. Projects which are beyond the capacity of the
entrepreneur are bound to fail

Availability of raw materials: the availability of raw material and the cost of
obtaining them are also important factors to be taken into account in selecting
the project. Scarcity of raw material may delay the manufacturing process. On
the other hand if the raw material is imported, the high costs of raw materials
due to changes in the exchange rates of currencies are an inhabiting factor.

Compatible with government regulation and priorities: the project

undertaken by the entrepreneur should not violate government regulations and
priorities. The government policy regarding investments and reservation of

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certain categories of items for the small-scale units should be taken into
account.

Role of Creativity in Entrepreneurship

The terms creativity and innovations are often used interchangeably but each
has a unique connotation. Creativity is “the ability to bring something new into
existence”. This definition emphasis the ability not the activity of bringing
something new into existence. Therefore, a person may conceive of something
new but not take the necessary action to make it a reality. Innovation is the
process of doing new things. Ideas have little value until they are converted into
products, services or processes. Innovations, therefore, is the process of
transformation of creative ideas into useful applications, but creativity is
prerequisite to innovation. Creativity is the seed that inspires entrepreneurship
this, Schumpeter concluded when he wrote about the economic foundation of
free enterprise and entrepreneurship.

Peter Drucker has agreed and further elaborated that, “innovation is the means
by which the entrepreneur either creates new wealth producing resources or
endows existing resources with enhanced potential for creating wealth”

The creativity process

Ideas usually evolve through a creative process whereby imaginative people

germinate the ideas, nurture them, and develop them successfully.

There are five stages in the creative process. They are;

1. Idea germination

2. Preparation

3. Incubation

4. Illumination

5. Verification
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In each stage, a creative individual behaves differently and the behaviour varies
greatly among individuals and their ideas. We will discuss the behaviours at the
different stages;

1. Idea germination: This is the seeding stage of a new idea. It is the stage
where the entrepreneur recognises that an opportunity exists. The idea
germination takes place according to interest, curiosity of the
entrepreneur according to which opportunity is explored and exploited to
its best potential. Creative idea germinates besides the interest, the need
of a specific problem or area of study.

For most of the entrepreneurs, ideas begin with INTEREST in the subject
or CURIOSITY about finding a solution to a particular problem.

2. Preparation: Once a seed of curiosity has taken the shape of a

focused idea, the creative person will make a through search for
appropriate answers. It is a problem that has to be solved, he would begin
by seeking information about the problem and by looking at how others
have tried to solve the same problem in the past. f it is an idea for a new
product or service, there is need to carry out appropriate market research.
While scientists will carry out laboratory experiments, designers will start
engineering new product ideas and marketers will study consumer buying
habits. An individual with an idea will thereafter think about it and
concentrate his energies on rational extension of the idea and how this
could be converted into a saleable product or service.

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3. Incubation: Creative people and people with vision often concentrate
intensely on an idea, but, in most cases, they simply allow ideas time to
grow without intentional effort. Most ideas evolve in the minds of people
with sown and given substance through preparation is put on back-burner.
This means that the subconscious mind is given enough time to assimilate
information collected from diverse sources.

Incubation is the stage of mulling it over while the subconscious intellect

controls the while creative process. This is, no doubt, a crucial aspect of
creativity because when imaginative people consciously focus on a
problem, they behave relationally in there search for systematic solution.
In this context, one may refer to the art of synoptic which means a joining

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together of different and often ideas. This means that when a person has
consciously worked to resolve a problem without success, allowing it to
incubate in the subconscious mind will often lead to a viable solution.

4. Illumination: Illumination occurs when a certain idea resurfaces as a

realistic reaction. Most creative people normally pass through numerous
cycles of preparation and incubation, searching for full meaning of the
idea. When a cycle of creative behavior fails to result in a catalytic event,
the cycle is repeated until the idea takes shape or disappears. This stage is
most crucial for entrepreneurs because ideas by themselves carry little
practical significance for business. Reaching the illumination stage
separates people living in a world of illusion from creative people who
find a way to create value.

5. Verification: An idea illuminated in the mind of an individual still

has little meaning until it is verified as realistic and useful. The
significance of entrepreneurial effort lies in the fact that it is essential to
translate an illuminated idea into a verified, realistic and useful
application. in fact, verification refers to the development stage of
refining knowledge into application. During this stage, many ideas will
be rejected as they do not paper to be fruit-bearing or having practical
relevance. It is often found that a good idea has already been developed
or the eager entrepreneur finds that competitors already exist in the
market. Inventors often face such a situation when they seek patent
protection only to discover similar inventions already registered.

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