Page 8 - DMGT310_ENTREPRENEURSHIP_AND_SMALL_BUSINESS_MANAGEMENT

Unit 1: Entrepreneurship: A world of Opportunity

Notes
Did u know? According to George Bernard Shaw, “The people who get on in this world
are the people who get up and look for the circumstances they want, and, if they can’t find
them, they make them.” It seems George Bernard Shaw was talking about entrepreneurs,
because this is what entrepreneurs do; they create their own future. The entrepreneur
understands possible futures and creates the future of his or her choice.

Entrepreneurship is the tendency of a person to organize the business of his own and to run it
profitably, using all the qualities of leadership, decisions making and managerial caliber etc.
The term “entrepreneur” is often used interchangeably with “entrepreneurship”.
Entrepreneurship is a role played by or the task performed by the entrepreneur. The central task
of the entrepreneur is to take moderate risk and invest money to earn profits by exploiting an
opportunity. For this he must possess far-sightedness to perceive an opportunity so that he can
exploit it well in time. Although an entrepreneur has to perform diverse functions yet he must
manifest many qualities in himself to be a good entrepreneur.

Self Assessment

Fill in the blanks:

1. Entrepreneurship is often viewed as a ……………… which involves the exploitation of
opportunities, which exist within a market.
2. Entrepreneurship is the …………………. of a person to organize the business of his own
and to run it profitably.
3. Entrepreneur must possess ……………………. to perceive an opportunity so that he can
exploit it well in time.

4. Individuals within organizations can be classified as entrepreneurs since they pursue the
exploitation of ……………………

1.2 Importance of Entrepreneurship

Prosperity of a nation depends on the development of its economy. Every nation has a
responsibility to ensure economic development to improve the living standards of the people,
eliminate poverty and backwardness. The process of economic development involves
improvement in Gross National Product and depends on the utilization of physical natural
resources by the human resources to realize the productive potential of the nation. It requires
increase in production and level of consumption.
In a labor abundant but capital short economy like India, there is limitation to the government
in directly involving itself in increasing productivity considering the severe budgetary constraint
for funds and the pressing need for higher investment in the frontiers of social development.
Hence, the people have to come forward to engage themselves in productive activities by
starting their own industrial unit’s livelihood. When more and more persons come forward to
start their own enterprises, however small it may be, and run the enterprise, efficiently and
effectively, the productivity of the nation will automatically improve. The government
implements a number of programmes to induce self-employment and to develop
entrepreneurship in the country. Hence, development of entrepreneurship and entrepreneur
are sine-qua-non for the economic prosperity of the nation. Following are the reasons why
entrepreneurship holds vital role in an economy:

1. Creates wealth for nation and for individuals as well: All individuals who search business
opportunities usually, create wealth by entering into entrepreneurship. The wealth created

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