Entrepreneurship Development in Agriculture, Slides of Entrepreneurship

Download Entrepreneurship Development in Agriculture and more Slides Entrepreneurship in PDF only on Docsity! Welcome Lecture: 06 Stages of establishing enterprise Dr. Manohar B. Dhadwad, Assistant Professor, Department of Agril. Extension & Communication PGI, MPKV, Rahuri Introduction • The setting of an enterprise involves • the study of business opportunities, • developments of a feasible business plan and • identification, determination and arrangement of men, materials, machinery and market for products. Establishing an Enterprise Entrepreneurial development • The process of starting a new business venture is embodied in the entrepreneurial development process. • The process can be classified into four phases. Establishing an Enterprise Khanka SS 1. Project Identification: 1. Idea Generation 2. Opportunity Scanning & identification 2. Project Selection: 1. Idea & Opportunity Evaluation 2. Product Selection 3. Project Formulation/ Business plan preparation 4. Project Appraisal 5. Financing of Enterprises 6. Ownership Structure & Management • Refers to an expansion • in overall sales volume and in the number and variety of customers, • an expansion of products or services offered, and • an established brand identity in the marketplace. • They hire more employees, improve infrastructure and equipment, make improvements to internal systems, and improve their efficiency and productivity. • Primary Activities: • assessment and adjustment of the organizational structure; • the delegation of management control; and • the development of longer-term strategies for human resources, access to capital, and expansion through a strategic planning process. Stages of Enterprise Development • Refers to achievement of solid business that appears to be sustainable. • However, without dramatic change, companies in this stage are unlikely to expand significantly. • Challenges: Sustaining themselves in a rapidly changing and competitive marketplace or in the face of declining sales can be difficult. • Primary Activities: • to maintain its position in the marketplace. • problem solving, • leadership, and • quality improvement • Planning for the succession of leadership • Creating an exit strategy for the business Stages of Enterprise Development • Arises when external or internal activities (or both) force a mature business to a tipping point. • A downward trend may ensue, or innovative “challenger firms” may introduce new ideas, products, or services to revive the sector. • Primary Activities: • Innovation and diversification, • Reorganization Stages of Enterprise Development SOURCES OF BUSINESS IDEA GENERATION • Personal Interests • Work Experience • Consumers: • Existing products: • Distribution Channels: • Research & Development: • External Environmental Opportunities: METHODS OF BUSINESS IDEA GENERATION • Environment Scanning • Creativity & Creative Problem Solving: METHODS OF BUSINESS IDEA GENERATION • 1. Focus Groups: Groups of individual providing information in structured formats. • 2. Brain Storming: A group method for obtaining new ideas and solutions. • 3. Problem inventory analysis: A method for obtaining new ideas and solution by focusing on problems. • 4. Creative problem solving: A method for obtaining new ideas focusing on parameters. • 5. Reverse Brain Storming: A group method for obtaining new ideas focusing on the negative. • 6. Synectics: A method for individuals to solve problem through one of the four analogy mechanism : Personal, Direct, Symbiotic and Fantasy Identification & evaluation of the opportunity: • Business idea/opportunity must be carefully screened and evaluated for market potential, financial viability and technical feasibility. • Entrepreneur should understand the cause of opportunity. • It may be technological change, market shift, government regulation or competition. Development of a Business Plan • A good business plan develops in order to catch the defined opportunity. • Business plan helps the entrepreneur in • developing framework of activities, • arranging finance and other inputs, • selecting appropriate production technology, • securing clearance from the government and • successfully managing the resulting venture. Establishing an Enterprise Determine the Resources Required This process stars with an appraisal of the entrepreneur’s available resources. Types of resources: Financial: this includes money, shares and other assets Physical: refers to tangible property such as equipment and office space Human resources: includes the knowledge, training, experience, as well as the time of the business owner and employees Technological: are embodied in a process, system or physical transformation, eg. unique software products and tailored information system architecture Reputation: encompasses the perceptions that people in the business' environment have of the business Organizational: include the business' structure, routines and systems Establishing an Enterprise Steps in setting up an enterprise • Ministry of Micro, Small and Medium Enterprises (MSME) has defined 8 distinct steps for setting up micro, small and medium level enterprises. • These steps have been given in details at http://dcmsme.gov.in/howtosetup/getstart.ht m . Establishing an Enterprise Steps in setting up an enterprise 1 2 3 4 5 6 7 8 Project Selection Technology and machinery Arranging Finance Unit Development Filing of Entrepreneurs’ Memorandum Approvals Clearances Quality Certification 1. Project Selection • After emergence of viable business opportunity, project has to be conceptualised in all dimension of 4 Ps of Project • Product (shape, size and nature), • Process (technology to produce the product),  • Place (Location of plant), and • Partner (Technological or Financial Collaborator). Steps in Setting up Enterprise 3. Arranging Finance • Monetary support is necessary to take off small enterprises. • The monetary support is required as seed capital, short, medium and long term loans and for mitigating risk. • The important institutions provide credits to business enterprises are commercial/Regional Rural/Co-operative Banks, Small Industries Development Bank of India (SIDBI) and State Financial Corporations, etc. Steps in Setting up Enterprise 4. Unit Development • Setting up an establishment requires • negotiating a favourable plot or shed purchase, • organising for proper construction of building, • design of interiors and finding good deals for equipment and machinery. • Getting power connection causes delay in setting up of plant. Steps in Setting up Enterprise 4. Unit Development (Cont.…) • Projections for manpower and staffing, machinery and materials are made in the business plan. • Selection of proper manpower and procurement of right machinery and materials are very important and critical in establishment of plant to success. Steps in Setting up Enterprise