Entrepreneurship Challenges and Opportunities

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Rural entrepreneurship presents challenges, opportunitiesFiled under: Uncategorized Mary Paulsell @ 2:51 pm

02/26/2010As I sat in a legislative hearing the other day regarding economic development and job growth, Iheard a theme emerge in the discussion a deep concern for small businesses, particularly inrural communities. Whether referred to as Mom and Pop operations or Main Street businesses,these small firms make up the fabric of these small, rural communities, but their very existencecontinues to be threatened by recessionary times and larger stores that sell on low price andvolume.

We are seeing some ideas and trends emerge around rural entrepreneurship. One of the primarymessages these days is the importance of the upcoming 2010 census, which has the potential to

affect rural small businesses for years to come in terms of infrastructure and tax base. If yourean entrepreneur in a rural area, it might serve you well to join in on the canvassing activities toensure that your community receives its fair share of funding for valuable services and amenitiesthat keep customers in your area.

Shop Local campaigns have been around for a while, but they are seeing a new resurgence ascommunities vie for limited spending money from their residents and fight the big box andonline battles. If your community doesnt have some sort of reminder to residents to look locallyfirst, start one. Its as easy as printing up a few window stickers or flyers and posting them in allof the local establishments. These resident companies the ones that are born, grow andsupport our communities create more jobs than all of the big guys combined. We need to keepthem strong.

There are lots of construction, refurbishment and rehab projects going on in rural communities asa result of the stimulus funding. If you are a local firm that could have a role in those projects,find someone to assist you with government contracting and sign up to get your fair share of thedollars.

In addition to record numbers of Baby Boomers starting businesses, many are forecasting thatthey will also be moving to small towns to enjoy a slower pace and healthier lifestyle. Consider what goods and services they will want in their retirement locations, and provide them!
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Entrepreneurship Challenges and Opportunities: IndianScenario

Dr. Vineet Chouhan Articles

Risk taking ability, Self-confidence, Decision making ability, Knowledge of cumingrowing to harvesting technology, Economic motivation, Market orientation, Risk factors, Soiland firm condition of experiences, Water resources, Water quality and volumes, need to cuminfor all technical factors, Ability of co-ordination to cumin related activities, Achievement,Motivation, etc. indicators are behavior of entrepreneurial.

Entrepreneurship has gained greater significance at global level under changing economicscenario. Global economy in general and Indian economy in particular is poised for acceleratedgrowth driven by entrepreneurship. Admits environment of super mall culture we find plenty of scope for entrepreneurship in trading and manufacturing.

An entrepreneur is a person who is able to look at the environment, identify opportunities toimprove the environmental resources and implement action to maximize those opportunities(Robert E. Nelson) it is important to bear in mind the entrepreneurial skills that will be needed toimprove the quality of life for individuals, families and communities and to sustain a healthyeconomy and environment. Taking this into consideration, we will find that each of thetraditional definitions has its own weakness (Tyson, Petrin, Rogers, 1994, p. 4).

The first definition leaves little room for innovations that are not on the technological or organizational cutting edge, such as, adaptation of older technologies to a developing-countrycontext, or entering into export markets already tapped by other firms. Defining entrepreneurship

as risk-taking neglects other major elements of what we usually think of as entrepreneurship,such as a well-developed ability to recognize unexploited market opportunities.

Entrepreneurship as a stabilizing force limits entrepreneurship to reading markets disequilibria,while entrepreneurship defined as owning and operating a business, denies the possibility of entrepreneurial behavior by non-owners, employees and managers who have no equity stake inthe business. Therefore, the most appropriate definition of entrepreneurship that would fit intothe rural development context, argued here, is the broader one, the one which definesentrepreneurship as: "a force that mobilizes other resources to meet unmet market demand", "theability to create and build something from practically nothing", "the process of creating value by

pulling together a unique package of resources to exploit an opportunity".

It combines definitions of entrepreneurship by Jones and Sakong, 1980; Timmons, 1989;Stevenson, et al., 1985. Entrepreneurship so defined, pertains to any new organization of

productive factors and not exclusively to innovations that are on the technological or organizational cutting edge, it pertains to entrepreneurial activities both within and outside theorganization. Entrepreneurship need not involve anything new from a global or even national

perspective, but rather the adoption of new forms of business organizations, new technologiesand new enterprises producing goods not previously available at a location (Petrin, 1991).
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This is why entrepreneurship is considered to be a prime mover in development and why nations,regions and communities that actively promote entrepreneurship development, demonstratemuch higher growth rates and consequently higher levels of development than nations, regionsand communities whose institutions, politics and culture hinder entrepreneurship. Anentrepreneurial economy, whether on the national, regional or community level, differs

significantly from a non-entrepreneurial economy in many respects, not only by its economicstructure and its economic vigorousness, but also by the social vitality and quality of life which itoffers with a consequent attractiveness to people.

Economic structure is very dynamic and extremely competitive due to the rapid creation of newfirms and the exit of 'old' stagnant and declining firms Redefining entrepreneurship andinnovation Succeeding as an entrepreneur and an innovator in todays world is vastly differentfrom what it was earlier. Organizations will face seven trends in the next decade as they flight tosurvive, grow and remain competitive.

Speed and uncertainty will prevail.

Technology will continue to disrupt and enable. Demographics will dictate much of what happens in business. Loyalty will erode. Work will be done anywhere, anytime. Employment as we know it will disappear.

Women Entrepreneur:

Women entrepreneurs have been making a significant impact in all segments of the economy inIndia, Canada, Great Britain, Germany, Australia and the United States. The areas chosen bywomen are retail trade, restaurants, hotels, education, cultural, cleaning, insurance and

manufacturing The New Thrust suggests following two factors pulling or pushing women in anentrepreneurship Factors leading women to be an entrepreneur:Women entrepreneurs choose aWomen takes up business enterprises to Profession as a challenge and an get over financialdifficulties and respond- adventure with an urge to do some - sibility is thrust on them due tofamily -thing new, liking for business and circumstances. to have an independent occupation.With the spread of education and new approaches/awareness, women entrepreneurs areachieving higher level of 3Es, namely: (i) Engineering (ii) Electronics (iii) Energy. Though weshould not forget certain Psycho-Social Barriers which hinders the growth of womenentrepreneurs.

Opportunities :

Free entry into world trade. Improved risk taking ability. Governments of nations withdrawn some restrictions Technology and inventions spread into the world. Encouragement to innovations and inventions. Promotion of healthy completions among nations Consideration increase in government assistance for international trade.


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Establishment of other national and international institutes to support business amongnations of the world.

Benefits of specialization. Social and cultural development

Challenges: Problems of raising equity capital Difficulty in borrowing fund. T hought-cut completions endangered existence of small companies. Problems of availing raw-materials. Problems of obsolescence of indigenous technology Increased pollutions Ecological imbalanced. Problems of TRIPS and TRIMS. Exploitation of small and poor countries, etc.

Suggestions Govt. should provide separate financial fund of womens entrepreneur. We should provide her special infrastructure facilities what ever she deeds. Govt. should arrange special training programmes of women entrepreneurship Govt. should felicitated top ranker womens entrepreneur. Women entrepreneur should more competitive and efficient in the local & international

market. Use should invite successful women entrepreneurs from foreign countries.

Women Entrepreneurship in India

Out of total 940.98 million people in India, in the 1990s, females comprise 437.10 millionrepresenting 46.5 percent of the total population. There are 126.48 million women workforce butas per the 1991 census, only 1, 85,900 women accounting for only 4.5 per cent of the total self-employed persons in the country were recorded. As per a rough estimate the number of SSIs areexpected to be2.5 billion having 9% women entrepreneurs in to it. Considering this trend,women participation in another five years was 20 % more, raising the number of womenentrepreneurs to about 5, 00,000. Combined effect of motivational drive, preparation of information material, conducting training, creation of women industrial estates, and training of

promoters and use of mass media all together is bound to accelerate the process of womenentrepreneurship development. Some psycho-social factors impede the growth of women

entrepreneurs are as follows: Poor self-image of women Inadequate motivation Discriminating treatment Faulty socialization Role conflict Cultural values


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Lack of courage and self-confidence Inadequate encouragement Lack of social acceptance Unjust social, economic and cultural system Lack of freedom of expression

Afraid of failures and criticism Susceptible to negative attitude Low dignity of labour

What New Awareness has to say about it? The new Industrial Policy of the Government of Indiahas specially highlighted the need for special entrepreneurship programmes for womenentrepreneurs in the nature of product-process oriented courses to enable them to start small-scale industries. A majority of women entrepreneurs are from the middle class families who havelow technical education, less family responsibilities but desire to become entrepreneurs. This

potential should be identified and tapped.

Rural Entrepreneur Succeeding as an entrepreneur and an innovator in todays world is vastlydifferent from what it was earlier. Besides the existing generation of entrepreneurship also is passing through the transition period. They experience financial resource limitation to promoteor to develop a venture and there is also look of research and innovation to meat with marketingchallenges. Indian rural economy is also experiencing behavior of entrepreneurial. Aim of mostfarmers is to earn profits from farming as from any other business, if he determines theobjectives. A farm business necessary requires deliberate decision and proper investment, after assessing risk and available resources to maximize profit. There for entrepreneurship is notsimply adoption of new activity but it is transformation of a person from traditional of modernIndia is known as Home spices and is in fact the largest producer, consumer and exporter of spices in the world. Though, cumin cultivation requires more inputs and production prices are

high but last two years monetary output is uncertain. It is also sensitive crop to many disease, pest and also highly risky crop considering natural hazards, as well as the day to day fluctuatingwholesale price index. Organizations will face seven trends in the next decade as they flight tosurvive, grow and remain competitive.

Speed and uncertainty will prevail. Technology will continue to disrupt and enable. Demographics will dictate much of what happens in business. Loyalty will erode. Work will be done anywhere, anytime. Employment as we know it will disappear.

Opportunities For rural Entrepreneurs.

Crashed Scheme for Rural Development Food for Work Programme National Rural Employment Programme Regional Rural Development Centers Entrepreneurship Development institute of India


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Bank of Technology Rural Innovation Funding Social Rural Entrepreneurship.

Challenges For Rural Entrepreneurs

Growth of Mall Culture Poor Assistance Power Failure Lack of Technical know how Capacity Utilization Infrastructure Sickness

Present Entrepreneurial Scenario

Mr. Ratan Tata had clearly articulated to us his vision for Tata Motors. The company has very

successfully launched its passenger cars- Indica and Indigo and recently in January 2008they have set a benchmark in the history of four-wheeler industry all around the globe byoffering their masterpiece NANO to be the worlds cheapest car worth 1 Lac rupees only. Thecompany has also taken over the business of Corus, a giant in the steel industry.

Vijay Mallya and talk of innovation, to hit the Indian market. Vijay Mallyas mission was tocreate brand Kingfisher as a generic brand for lifestyle. There happened to be some sort of compatibility between the way he lived his life and the brand image that he was thinking tocreate. One of the key ingredients of innovation is to simply be yourself. He did the restructuring

process of United Breweries without any sense of embarrassment. We are all sometimes stymied,curbed and limited by ourselves. Philips, Sony, Honda, Ford provide the signposts of

entrepreneurship today for all to emulate. Some of these have come up only in recent years andfrom small beginnings. In India, too, one sees glimpses of such entrepreneurship. ICICIsexperience tells a great deal about entrepreneurship good as well as not so good.

Following Indian firms will keep on dominating the corporate world in the future too

Tata Steel & Motors Indian Oil Corporation Reliance industries Infosys Technologies Moser Baer

Bharti Tele-venturesTwaalfhoven and Indivers (1993, pp. 3-4), they are run by dynamic entrepreneurs, who manageand lead their companies not only to remain in the business but to expand it. Dynamicentrepreneurs look for growth, they do not have only a vision but are also capable of making ithappen. They think and act globally, look for expansion, rely on external resources, seek

professional advice or they work with professional teams. They challenge competitors instead of avoiding them and take and share risks in a way that leads to success. In this way economic


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vitality of a country largely depends on the overall level of entrepreneurial capacity, i.e., on itsability to create rapidly growing companies

Summary

The entrepreneurs provide a magical touch to an organization, whether in public or private or joint sector, in achieving speed, flexibility, innovativeness, and a strong sense of self-determination. They bring a new vision to the forefront of economic growth.

After over 5 decades of Independence and Industrialization in our country, still large part of population remains under poverty line. Agriculture continues to be the back bon of ruralsociety.As per this study, 70 per cent of holdings are held by small and marginal farmersresulting in over crowding on the agricultural land and diminishing farm produce. This alsoresults in migration of farm worker in large numbers to the urban areas. In both the cases the

population remains under poverty line.

Agricultural work force has a share of 70 per cent in the total work force of the country.Cultivators who own farmland come to about 68 per cent of this work force while agriculturallabor accounts for the remaining 32 per cent. These cultivators are increasing in number over theyears but the large increase was among the agricultural labor which went up from 20 per cent of the rural work force to 32 per cent. One also needs to keep in mind that there is a continuous

growth of population.Thus, the policy for rural development has to tackle, the problems by providing other occupation options to the rural youths.

What could be a better option than entrepreneurship?

Entrepreneurship could take off the excess of labor from the farms that causes disguisedemployment. Disguised Employment means that there might be groups of people working on thefarmland and calling themselves employed. However, when these people are taken off that farmand employed elsewhere, the production of the farm does not go down. Hence, such peoplethough employed do not add to the production of the farm.We have also seen in recent past thatdespite enough food stocks with government warehouses, people are dying of starvation. This

indicates problem with the public distribution system . The question is, do we have todepend on government public distribution system? The response is, people taking upentrepreneurship themselves in the form of Trading and Cooperatives.

The basic entrepreneurial principles should be applied to rural development. This would resultin:a] Better distribution of farm produce resulting in the rural prosperity.
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b] Entrepreneurial occupation rural for youth resulting in reduction of disguisedemployment and alternative occupations for rural youth.c] Formations of big cooperatives like Amul for optimum utilization of farm produce. d] Optimum utilization of local resource in entrepreneurial venture by rural youth

THE SUPPORT SYSTEM:

However, there has not been enough development in this area. One of the reasons can be thatmanagement modes used were largely governmental. Those who were charged with theresponsibility of rural development were either bureaucrats or technocrats, who were using onlythe schemes as the motivation for developing entrepreneurs, without providing the necessarytraining for running an enterprise. Wherever we see on oasis of development in the desert of rural underdevelopment, we can trace an imaginative entrepreneur, who has used the correctmode of management of rural entrepreneurial venture to the best.

For example, the case of dairy development in the State of Gujarat. This model is popularlyknown as Amul Model. The Gujarat experiment was started more than 30 years ago. Startingfrom a small complex of eight societies which originally collected only a few hundred litres of milk it has grown into a huge complex collecting nearly seven lakh litres of milk per day from240,000 members organized into 840 village societies. Today 90 per cent of the processed butter and cheese market of the organized sector in the country is controlled by Amul. This has helpedsmall farmers. Behind the success of this co-operative venture is that dynamic entrepreneur andleader, Dr. Kurien whose target of opportunity seeking is not financial but social gain, not for

himself, not for the enterprise or agency he works for, but for the people he serves.

The model for frozen peas market developed by MAFCO in Maharashtra is another success story . This venture was started eight years ago. During the first year only 10tonnes of peas were sold, which went up to 42 tonnes in the second year, 120 tonnes in the thirdyear and 140 tonnes next year and so on. Behind this success story is also that the entrepreneur who could foresee and implement his plans of marketing. The opportunities in this area are quite

big. For example, the market for vegetables in West Asia is approximately Rs. 36 lakhs per day,

to be transported by air daily. What is lacking is managerial talent, which could exploit theseopportunities by organizing small farmers of this country.

Despite impetus provided by government there has not been much development in the rural area.One of the major reasons why not much headway has been made in this area during the last 50years is the lack of committed government officials implementing these projects. However,
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before a profile of these rural Entrepreneurs is carved, it is necessary to review the existing ruralscene and the agencies involved in the rural development. Such a review would help us inunderstanding the problems of rural India in a better way. This would also help us in drawing the

profile of the Entrepreneurs for rural development.The term Entrepreneur for rural developmentis being utilized instead of Entrepreneurs for rural industries.

The major problem with these entrepreneurs is that they look at the community only as a market.For example, a tractor manufacturing and marketing company looks at the rural India as a bigmarket for his tractors/without thinking of its innovative usage in urban and semi-urban areas,like tractor being utilized for town planning and Municipal Corporations jobs.The industries inrural areas should be set up not just to take advantage of the cheap labour but also to bring aboutan integrated rural development. Similarly, rural entrepreneurs should not only look at rural areasas their markets, they should also see the challenges existing in the urban markets. They may not

be setting up only an industry they might be bringing about a revolution with their innovative

ideas. They may not set up manufacturing units, they may set up a seed raising farm or carry outthe trading for the benefit of millions. Based on our understanding of the need of rural industrialventures, let us try to draw the profile of rural entrepreneurs.

PROFILE OF A RURAL ENTREPRENEUR:

a] He should not be an individualist. He should have a group orientation. He should consider therural society not as his market but as his own large family.

b] He should practice a management style where the concern for people is the highest.c] He should have a strong commitment for rural development.

d] He wont be interested in usual perks and entertainment allowance. Social gain will be his

perk and the smiles on the faces of impoverished rural population his only allowance.

NEED FOR SOWING THE DREAM IN THE MINDS OF RURAL YOUTH:

Youths in the rural areas have little options , this is what they are given to believe. This isthe reason that many of them either work at farm or migrate to urban land. The need is to plantother options in the minds of rural youth. Entrepreneurship could be the best option. If plantedand nurtured in the minds of rural women and youth, it could result in revolutionizing the Indianeconomy.It should be emphasized that the projects undertaken by these entrepreneurs should not

be constrained by its location in rural area. It should enjoy all the advantages of the location.Following are the advantages of rural industrial projects:
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A] Tax holidays and other tax advantages given to rural projects.B] Abundance of cheap labor.C] Advantage of local and regional resources in case the unit uses them as a raw material.D] Prestige and respect among the local communityE] Live example for local youth for taking up entrepreneurial project

F] Support and motivation from local peopleG] Competitive advantage over the big business due to the proximity to the raw material andlabor.H] Employment generation for local people.

TRAINING FOR RURAL ENTREPRENEURSHIP:

The training for development of rural entrepreneurship has to be different from theentrepreneurship development training in urban areas. This is the reason that government

initiated the integrated rural development programs.In Integrated rural development programs,apart from providing the training to potential rural entrepreneur, an industrial area potentialsurvey is undertaken to estimate the kind of industries that could be set up in that particular rural region.Industrial area potential survey has all the details about the cost of the project,

availability of technology , gestation period and return on investment for the projectsthat could be set up in that region. The District Industrial Centre conducts these area potentialsurveys for usage of potential entrepreneurs.
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Entrepreneurship Challenges and Opportunities