Assignment no:01 Prepared by: Roll no: AM552472
Q1: a)What is the difference between an entrepreneur and a manager? Explain the role of an entrepreneur in reducing social disparity by escalating economic growth? An Entrepreneur A Manager• An Entrepreneur(ahn‟tra pra nur) is a person • Manager is the person responsible for planning who organizes and manages a business and directing the work of a group of undertaking, assuming the risk for the sake of individuals, monitoring their work, and taking profit. Any person (any age) who starts and corrective action when necessary. For many operates a business is an entrepreneur. people, this is their first step into a• There is no levels in entrepreneurship. It has management career. three two main types productive and • In large companies management is divided unproductive entrepreneurship. into three levels: upper or top, middle and• Entrepreneurship is about finding demand and lower management. a path to market • Management is about making an existing• Entrepreneur initiates the plan, materialize it business work efficiently and implements it. • Manager implements these ideas and apply to• Entrepreneur is a leader and owner of the all employees. business. • Manager is a coordinator, he just manage the• An Entrepreneur hires manager(s). business organization.• An entrepreneur being the owner of the • A manager cannot hire an Entrepreneur. enterprise assumes all risks and uncertainty • A manager as a servant does not bear any risk involved in running the enterprise. involved in the enterprise.• As a reward, an entrepreneur gets profit which • A manager gets salary as rewards. Salary of a is highly uncertain. manager is certain and fixed.
Comparison between An Entrepreneur and A Manager An Entrepreneur ‘s skills A Manager ‘s skills
Role of an entrepreneur in reducing social disparity.Disparity is usually used to describe an unfair or unjust lack of equality. For example: "the disparity between the rich and the poor." In more technical terms, disparity can refer to any difference, inconsistency, or gap that seems to indicate a problem. For example: "There seems to be a disparity between my check book records and mybank account."Entrepreneurship is the active process of recognizing an economic demand in an economy, and supplying the factors of production (land, labor and capital)to satisfy that demand, usually to generate a profit. Through that activities in socialenvironment entrepreneurship increase economic growth and helps to reduce socialdisparity and poetry. High levels of poverty combined with slow economic growth in the formal sector have forced a large part of the developing world‟s population into self-employment andinformal activities.That helps to low-income people to escape poverty with limited skills and education tocompete for formal sector jobs, these men and women find economic opportunities inmicroenterprises as business owners and employees. If successful, entrepreneurship is likely toresult in a small- to medium-enterprise (SME). They include a variety of firms like village handicraftsmakers, small machine shops, restaurants, and computer software firms. In most developingcountries, microenterprises and small-scale enterprises account for the majority of firms and a large shareof employment. Concept of entrepreneur to an innovator shows four roles:• The person who has a new idea and that specifically invents a new product.• The capitalist, who provides financial resources for the innovation to occur.• Finally the manager who supervises the daily business of the new idea.According to these the different roles of entrepreneur points into the direction of an effect on economicgrowth.
The mechanisms that links entrepreneurship to growth may beessentially four: knowledge spillovers, decentralization, experimentationand competition.“There is a wide-spread opinion that national or regional economic development isassociated with new firms creation intensity. New firms formation is considered as animportant indicator of entrepreneurial activity and key component in economicdevelopment and growth, which has been explained by the creation of new capacities into the market and through improvement of the competitiveness of the economy, industry or region.(Fritsch & Mueller)”
Q1: b) Should the main focus of an entrepreneur only be economic growth? Is this focus ethically appropriate?Main focus on economic growth does not support the entrepreneur toachieve his real success and that is not ethically correct. Nineteenth-century writerand philosopher Thomas Carlyle wrote: “Blessed is he who has found his work; let him ask no other blessedness. He has a work, a life-purpose.”In business people believe that the purpose of their work is to be found in profit. But profit is noble when itis seen as a means of making people‟s lives better: the customer whose life is made better by theproduct or service; employees who are able to make a good living and provide for their families;stockholders whose quality of life is enhanced. So, Main focus only on economic growth is not ethicallygood. Leading enterprises, government agencies, and NGOs have found that an effective businessethics program addresses functions at seven levelsof responsibility:1. Overseeing the program at a high level (the responsible officer)2. Performing or coordinating the specific functions of the business ethicsprogram (the business ethics officer)3. Advising the responsible officer and business ethics officer and representing the enterprise as a whole (the business ethics council)4. Advising the responsible officer, business ethics officer, and employees and agents about specificprofessional ethics, compliance, and social responsibility issues, such as biomedical, engineering, orcommunity issues (the professional ethics council). 5. Linking various levels of the enterprise with a central ethics office (business conduct representatives)6. Performing related executive and department functions (the chieffinancial officer; legal counsel; human resources; internal audit; environment,
health, and safety; government procurement; and investor relations)7. Abiding by standards and procedures and striving to meet reasonable stakeholderexpectations (every employee and other agent of the enterprise)Support for a business ethics program must start at the top of an enterprise. Thefollowing general elements of leadership are typically found in successful programs: • The owners or owner representatives ensure that the program provides them with adequate information regarding enterprise performance. • The owners and managers set a to of support for responsible business conduct. • A high-level person is responsible for the business ethics program. • The supervisors are responsible for how things are actually done in the enterprise. Respect: As an entrepreneur building a business, it is necessary to respect yourself and surroundyourself with people you can respect. Honor: Good people are a fundamental part of good ethics. They are also great ambassadors fordoing things right. Give special attention to strong performers and people whoexemplify the spirit of your organization. Integrity: Do not lie, steal, or cheat. Make your word your bond and always stand by your word. Whenyou are wrong, own up to it and make good on the deal. Treat others as youd want to be treated.Do not hire or retain people who do not have integrity. Customer focus: A company is nothing if it does not have customers. Afocus on your customers reinforces the responsibility you have to the market.Your decisions affect your people, your investors, your partners and ultimately,your customers. Serving all of these people is part of your ethical responsibility.Passion: Great organizations are comprised of people who have a passionfor what they are doing. These are people who are working for you for the thrilland challenge, not merely putting in time to collect a pay-check.
Q2: a)Discuss the importance of international entrepreneurship and the ways of entering international markets?International entrepreneurship (IE) presents an integration of international business,entrepreneurship, and strategic management. Perhaps the most recent definition of international entrepreneurship is the one of Oviatt and McDougall is: “The discovery, enactment, evaluation and exploitation of opportunities across national borders to create future goods and services“Importance of international entrepreneurship are followings:1. Globalization:There may be very small markets in the restricted area depending on products or service. The Globalmarket is a much larger opportunity. The idea of entrepreneur is to reach more people and generatemore revenue.2. Universal nature of product and services:Entrepreneurs go global, if their products/ services are moderately universal in nature. For example it iscompetent enough for consumption, cutting across caste, creed, race, culture, technology etc.3. Reduction of cost:Because of many factors like low currency rate, cheap labor, cheap raw martial, cultural and nationaldifference that is important to adopt international entrepreneurship and make the local businessmultinational.4. Growth and employment:Cross-border or international entrepreneurship gives growth to local. Business and to access towardsinternational markets. That growth of the business decrease the unemployment. The most comprehensiveindicator of an economy‟s performance is that of national income or Gross Domestic Product.Embracing in its concept, GDP provides a broad view of the structure and functioning of the economy.That become possible when international entrepreneurship is promoted by nation.
5. Export and import:Export and import through cross national trade by legal ways is a greatimportance of international entrepreneurship. International trade exists becauseone group or country has a supply of some commodity or merchandise that is indemand by another. And as the world becomes more and more technologically advanced,as we shift in subtle and not so subtle ways toward one-world modes of thought, internationaltrade becomes more and more rewarding, both in terms of profit and personal satisfaction.How to enter in international markets: There are following steps to enter in international market:•Searching and monitoring business opportunities at international level•Exploring international market presence•Setting up local offices abroad•Creating and designing an international company strategy
• Designing and implementing new solutions, products, services targeted to international costumers• Giving an international focus to business projects• Dealing with/being involved in international mobility and expatriation issues• Organizing and coordinating events (fairs, exhibitions, seminars, etc) abroad or• Involving people coming from abroad• Dealing with foreigner customers or foreigner authorities• Recruiting and developing multi-cultural teams.• Dealing/Communicating with customers, business partners, suppliers indifferent parts of the world (personally, by telephone, in writing through letter, fax, e-mail, etc)
•Participating in cross-cultural meetings•Dealing with/being involved in international mobility and expatriation•Issues Organizing and coordinating events (fairs, exhibitions, seminars, etc) abroad or involving people coming from abroad…• Managing international business relations/contacts• Gaining clients, business partners and employeestrust/cooperation• Dealing with cross-cultural conflicts• Participating in international negotiations/sales.So, in short entry to international market process can bedivided into five main headings: Country Identification Preliminary Screening In-Depth Screening Final Selection Direct ExperienceSo, It is essential before entering a foreign market toclearly identify the motivations behind your decision toexplore entering the international marketplace. Examine what your domestic marketing strategy hasbeen and how the domestic plan employed by yourcompany on a local level needs to be tailored to bepositively received in the proposed international territory.When working on building your brand‟s internationalpresence and market-share make sure that you arethinking globally and creating a comprehensivestrategy.
Q2: b) Highlight the problems and barriers commonly associated with international entrepreneurship, also suggest possible solutions to overcome these problems?The economist Joseph Stigler defined an entry barrier as "A cost of producing (at some or every rate of output) which must be borne by a firm which seeks to enter an industry but is not borne by firms already in the industry“.Hundreds of entrepreneurial and growing companies consider international expansion as a marketingand growth strategy. When developing a strategic plan to launch an international businessprogram, growing companies and their advisors must always consider the potential barriers . Theseinclude the following:• Language Barriers: Although it may seem simple enough at the outset to translate the features of a given product or serviceinto the local language, marketing the product or service may present unforeseen difficulties if theconcept itself does not "translate" well. The target countrys standards for humor, accepted puns orjargon, or even subtle gestures may not be the same as your domestic countrys norms or idioms andmay need to be adjusted accordingly.• Marketing Barriers: These types of barriers most frequently go to the deepest cultural levels. For example, in gulf countriesuse of vine and pig meat is prohibited but in Europe these product have a great earning and openmarketing opportunities. Furthermore, ice-cream business have very minimal profit in such market wheresnow is falling.• Legal Barriers:The company wants to be a multinational, must research tax laws, customs laws, importrestrictions, corporate organization, and agency laws. Trade restrictions such as tariffs and quotas shouldalso be considered as a barrier to the entry of international competition in protected domestic markets.
considered as a barrier to the entry of international competition in protecteddomestic markets.•Access to Raw Materials and Human Resources:Not all countries offer the same levels of access to critical raw materialsand skilled labor that may be needed to offer the service. The growingcompany may want to consider what changes in the product or service may befeasible to accommodate this resources challenge without sacrificing the corebusiness format.• Governmental and Regulatory Barriers:The foreign government may or may not be receptive to foreign investment or expansion. A givencountry‟s past history of expropriation, government restrictions, and limitations on currency repatriationmay all prove to be decisive factors in determining whether the cost of market penetration is worth thebenefits.• Barriers of gender:Gender is also a big barrier for international entrepreneurship, for example the government of Oman hastaken many initiatives in banking such as HSBC Bank, Middle East Limited and National Bank of Omanalso support the small and medium enterprises. However, there are certain barriers that challengewomen entrepreneurs.• Economical and Non Economical barriers: Economical behavior of foreign country is also a huge barrier while a entrepreneur want to become ainternational entrepreneur. Economical behavior contain lot of factors like consumer choice, demandand supply, saturation, trade cycle etc. That economical and political factors also have a greatinfluence on business growth and these factor become a barrier in the way of cross-national orinternational trade. Just like economic barriers , non- economical barriers also restricts international tradeand entrepreneurship. For Example: personal barriers.
Q3: a)Business Idea generation can ensure success or failure of an entrepreneurial venture. What are the different methods available for generating new venture ideas?Business idea generation is a goal oriented process, itmean before idea generation entrepreneur measure itsresult in failure and success. A good idea is a guarantyof success. And a idea which have no orientedtowards its effecting factor mostly direct that businesstowards failure. An idea can be defined as: “One of the single most powerful influenceson the quality of blog content is the originality of ideas”9 Steps to generate better Ideas1. Make Time for It:Make idea generation one of priorities, and recognizeits influence on business success. There are plenty ofactivities that can consume time, but don‟t do so atthe expense of working on new ideas. Without leavingtime for it, if someone find sitting at the computersearching for a topic to write about, and the results willsuffer.2. Have a Brainstorming Session:Rather than trying to come up with one post idea at atime as entrepreneur need them, sit down and crankout as many ideas as you can. Write down all of yourideas. Many of them will not turn into anything usable.Get your creative energy flowing.
3. Use Mind Mapping:Mind mapping is a method of brainstorming that helps you to visualizeyour ideas and to build on them with other related ideas. This method canreally help you to develop ideas for posts on particular subjects and topics as youcan visualize all of the different aspects and you see the possibilities for useful blog posts .4. Outline Posts Before Writing Them:If you are typing your idea with little or no direction you will have disjointed articles that are lessproductive than they could be. I find it to be very helpful to outline every post before I actually write thecontent. This may require some research, depending on the topic, but it will make the writing processeasier. It also helps you to identify ideas that really don‟t develop into quality posts.5. Take Your Ideas and Plan a Posting Schedule:It is very helpful to plan out posts a week in advance. Every weekend through the ideas that you havebeen working on, and select the ones that you are going to finalize and publish during the upcomingweek. This helps to avoid last minute posts that don‟t have much of a point except to get somethingpublished.6. Don’t apply idea unless You Are Happy With It:If you finish a idea post and you feel that it doesn‟t live up to your standards of quality, either keepworking to improve it or just get rid of it. It‟s never fun to give up on an idea that you‟ve spent some timeon, but that is better than applying something that could lower your customers opinions.7. Improve Your Title Writing SkillsSome bloggers start the process of writing a post by first coming up with an attention-grabbing title andthen working from there to develop the content. While this may not always work, it is a different methodthat can help to give your writing process a spark.8. Analyze Your ResultsLast step of idea generation is to analyze the result, it means to check the idea before implementation.
First, a business plan helps provide direction by making discuss whereentrepreneur wants to take the venture and define what he want out of it.Second, a business plan provides structure to think and help to make sure thatentrepreneur covered all of the important areas.Third, a business plan prompts to think about the future. For instance, a business planmight help to consider what would do and when, once venture is developed, it attracts several competitors. A good business plan will include ideas for dealing with newcompetitors in market..Finally, a business plan will help to communicate idea, not only to financers, but also to employees,potential employees, suppliers, and customers. As a communication tool, a carefully developed plan willprovide something that other people can react to. It can use their insights to help to develop a moresuccessful venture.These steps are a way towards success but if these all steps ignored then it will be cause of businessfailure.Methods available for generating new venture ideas:With a wide variety of sources available, coming up with an idea as the basis for a new venturecan still be a difficult problem. The entrepreneur can use several methods to help generate and test newideas. The following are some of the key methods to help generate end test new ideas:1. Focus Groups – These are the groups of individuals providing information in a structural format. Anexpert leads a group of people through an open, in-depth discussion rather than simply asking questionsfor participant response. Such groups form comments in open-end in-depth discussions for a newproduct area
that can result in market success. By generating new ideas, the focus group is an excellent source forinitially screening ideas and concept.2. Brainstorming – It is a group method for obtaining new ideas and solutions. It is based on the fact that peoplecan be stimulated to greater creativity by meeting with others and participating in organized groupexperiences. The characteristics of this method are keeping criticism away; free wheeling of idea, highquantity of ideas, combinations and improvements of ideas. Such type of session should be fun.Brainstorming has a greater probability of success when the effort focuses on specific product or marketarea.3. Problem inventory analysis– It is a method for obtaining new ideas and solutions by focusing on problems. This analysis usesindividuals in a manner that focus groups to generate new product areas. However, instead ofgenerating new ideas, the consumers are provided with list of problems and then asked to havediscussion over it and it give results in an entirely new product idea.4. Market Research – Market research can be done very easily. Survey around market area and see what types ofbusinesses are present. By looking at busy stores and shops and talk with their owners it shall becomeeasy to knew that what do they do different and why are they busier than their competitors?5. Through Internet: Through internet now that world become a global village, internet is a quick andbest source of new information and ideas.6. Traditional and electronic notebook methods: During meeting use of notebook is very common, no a days electronic notebook idearecording is very useful for recording new ideas and mind concept.7 weekly, monthly and annual meetings: weekly, monthly and annual meeting is a very good source for idea generation. Meetingprovides a channel to top level management and owners of the company to understand employeesproblem and to get ideas of employees.
Q3: b) Explain different aspects of product planning and development process?At the earliest stages of the product lifecycle, product planning teams need toefficiently identify key market and sector trends. Integrated global solutions revealinvaluable price, specification, sales and registration information. Product planning isrevolutionized when emerging trends in specification availability atsegment, market, regional or global level can be identified.•Competitors‟ concept models•Insider stories from automotive shows•Immediate, unrivalled overview of industry developments and predicted trends Newly launched products across market segments with market trends established, specification and development comes to the fore. Identification of key components and features of a vehicle are vital to successfully define the concept competitively. Fundamental to the definitive stages of product planning andresearch and development teams to successfully consider:• Weight and dimensions Important specification items• Competitive components - performance, economy, safety, comfort, cost of ownership• Modeling of equipment and pricing based on competitive specifications• Emerging trends in specification availability – through market sectors
1. Idea Generation is often called the "fuzzy front end" of the NPD processIdeas for new products can be obtained from basic research using a SWOT analysis(Strengths, Weaknesses, Opportunities & Threats), Market and consumertrends, companys R&D department, competitors, focus groups, employees, salespeople, corporate spies, trade shows, or Ethnographic discovery methods (searching for userpatterns and habits) may also be used to get an insight into new product lines or product features.Lots of ideas are being generated about the new product.2. Idea ScreeningThe object is to eliminate unsound concepts prior to devoting resources to them.The screeners should ask several questions:• Will the customer in the target market benefit from the product?• What is the size and growth forecasts of the market segment/target market?• What is the current or expected competitive pressure for the product idea?• What are the industry sales and market trends the product idea is based on?• Is it technically feasible to manufacture the product?• Will the product be profitable when manufactured and delivered to the customer at the target price?
3. Concept Development and TestingDevelop the marketing and engineering details• Investigate intellectual property issues and search patent data bases• Who is the target market and who is the decision maker in the purchasing process?• What product features must the product incorporate?• What benefits will the product provide?• How will consumers react to the product?• How will the product be produced most cost effectively?• Prove feasibility through virtual computer aided rendering, and rapid prototyping• What will it cost to produce it?4. Business Analysis• Estimate likely selling price based upon competition and customer feedback• Estimate sales volume based upon size of market.• Estimate profitability and break-even point5. Beta Testing and Market Testing• Produce a physical prototype or mock-up• Test the product (and its packaging) in typical usage situations• Conduct focus group customer interviews or introduce at trade show• Make adjustments where necessary• Produce an initial run of the product and sell it in a test market area to determine customer acceptance6. Technical Implementation New program initiation Finalize Quality management system Resource estimation Requirement publication
• Publish technical communications such as datasheets• Engineering operations planning• Department scheduling• Supplier collaboration Logistics plan• Resource plan publication• Program review and monitoring7. Commercialization :Launch the product Produce andplace advertisements and other promotionsFill the distribution pipeline with productCritical path analysis is most useful at this stage8. New Product Pricing Impact of new product on the entire productportfolio Value Analysis (internal & external) Competition and alternative competitivetechnologies Differing value segments (price, value, and need) Product Costs (fixed & variable) Forecast of unit volumes, revenue, and profit
Q.4: a) What is a business plan? Explain all the elements of the business plan.A completed business plan should identify the expectations you have for your new or existing businessand should tell “the tale” of your business to a potential lender. The plan is a stand-alone documentbecause, when completed, all business issues should be addressed without requiring additionalexplanation. The plan is a living document and should be reviewed and changed as regularly as yourplans and strategies change. These 10 elements are a guide to formatting and writing the plan:1. The Executive Summary:This is the first element of your plan but is written last. It tells who you are, explains your vision and yourstrategy, what you are doing or proposing to do, the market, the capital you need and what you‟ll dowith it and your competitive advantage. In short it is the business plan in miniature and the reader, whenfinished, should be able to explain to someone else what you are all about.2. The Company:Cover the company name, licenses needed, ownership, legal structure, and a description of yourproduct or service and what you plan to do with it (service, retail, wholesale, or manufacturing). Addresscompany location, space needed, ownership of the space, whether this is a start up, an expansion orpurchase of an existing business. Describe the company goals and objectives and any plannedchanges.3. Market Analysis:Discuss your target market, market segments and customers in these segments. Address your penetrationof the market, translate that into potential revenue over three years and state whether your revenueshare will increase or decrease with market growth. How you will price your service or product to make afair profit and be competitive. Why will a customer pay your price.4. Products and Services:Describe the products and service offerings, the customers they address and the value they bring to thecustomers in terms of customer pain.
5. Business Strategy and Implementation:Explain how you will gain access to the marketplace. Will you advertise or attend tradeshows. Will you have a web site and how are you going to publicize it.6. Competition:Who are your five nearest competitors by name and how will your operation be better thantheirs. Is their business steady, on the increase or decrease and why. What are their strengthsand weaknesses and how is your operation similar or different. How will you maintain a future watch onyour competition.7. Operations:How will you produce or deliver your product or service. What is your credit policies and how will youcollect due monies. How many employees will be required, what skills will be needed and how willtraining be delivered. Also the relevant equipment and technology needed and the kind and level ofinventory you will have to carry. Have you researched all legal and licensing issues that are relevant tothis business.8. Organization:Who will have management responsibilities and include their relevant experience. Include the resumes ofkey managers as supporting documents. Include position descriptions for all key employees and listimportant advisors, such as attorney, accountant, banker, insurance agent, vendors, and advisory boardmembers or board of directors. Include estimated financial costs and necessary services provided.9. Financial Analysis:List an explanation of the assumptions you are using to arrive at the dollar value of all financialstatements. Calculate start up costs including, leases, insurance, license cost and any amounts neededfor renovation and equipment.10. Supporting Documentation:Personal resumes, job descriptions, personal financial statements, credit reports, letters-of-reference, letters-of-intent, leases, other legal documents, market statistics and anything else that is
Q4: b) Explain how to monitor and update the business plan?When developing your monitoring plan it should be consider the resourcesthat are available and how it fits with other property management tasks. Theseresources may include budget, equipment, time and/or skills. The plan should outline the why, what, when, who and how of monitoring activities.Answering the following questions will help you plan your monitoring program.1. What are your monitoring objectives?2. How will your data be used?3. What will you monitor?4. Where will you monitor?5. When and how often will you monitor?6. How will your data be managed?1. What are monitoring objectives? A critical step in developing monitoring plan is deciding what want to gain from monitoring. Forexample, monitoring can be used to:evaluate the effectiveness of current management activities, to facilitate early detection of potential oremerging problems, to record changes in condition over time, to plan ongoing management activities.monitoring objectives should be specific, measurable, achievable, realistic and timely and guide thedevelopment of the rest of business plan.2. How will data be used?How intend to use data determines both the required data quality and monitoring methods. It should beconsider who will be using data, how they will be using it and for what reasons it will be used. If you arecollecting data only for your own land management decision-making, then you can choose the level ofdata quality and reliability that best meets needs.
3. What will you monitor?What you choose to monitor must reflect the objectives of your monitoringplan. There are many ways of identifying what to monitor on your propertysuch as:Adopting all or part of the approaches taken by existing initiatives, programs and policies exploring what monitoring is already occurring in your area to assist with informationsharing, and to help you become more familiar with specific issues and successful techniquesapplied in your area. The following information describes some of the key industry, regional, state andnational initiatives, programs and policies that relate to property level monitoring.4. Where will you monitor?The objectives of your monitoring plan should be the key factor that determines where you will monitor.You will need to define the geographic boundaries for your monitoring. For example, answering thefollowing questions:Will you monitor your entire property or only a selected area?Do you want to work with any of your neighbors to share expertise and learning?Do you need information at a wider scale (e.g. sub catchment) to really understand what‟s happeningabove and below you in the catchment?Do you want to use a control treatment, such as a fenced-off enclosure in a grazing paddock, to allowcomparisons between treatments? 5. When and how often will you monitor?How often monitoring will be carried out depends on the indicator(s) you choose and the objectives ofyour monitoring plan. Monitoring for gradual processes such as water table rising decline will be lessfrequent (e.g. intervals of two to three years) than monitoring for more rapid processes such as thespread of some pest animals or plants. It can also be informative to monitor when key events such asfire, drought or floods occur. For example, the early stages of soil erosion can be most easily recognizedafter periods of heavy rain.
6. How will your data be managed?As your collected data and information will grow and develop over the years it is important for theinformation to be well organized and quick and easy to locate. If you intend to share your data, somesimple steps/guidelines at the start will make your data more useful or acceptable to the data collectionstandards in place. Key questions to think about are:1. Will you retain the information as paper-based or electronic records?2. How you will maintain consistency in your record keeping?3. How will your records will be accessed in the future?business plan can be updated every month, every week and every day; whenever things change, youcan update your plan. steps of updating a business are following:The Annual Update:Update your plan thoroughly at least once a year. You canstart with an old plan and revise, but make sure you aretaking a fresh look--distance yourself from the trees and lookat the forest.The Monthly Update:Accounting and financial analysis normally works in months since the books close after every month. Make sure you havea monthly review of the difference between planned resultsand actual results for your sales, profits, balance and cash.For each of the standard pro-forma projections, alwaysmaintain a table with the plan, another with actual results,and a third with the difference between plan and actual, which is called variance. As an annual plan marches through the months, you can use the tablereserved for actual results to include changes in budget that affect the near future.
Q.5: a) Discuss the, organizational, financial plans of a new business venture?The five basic steps in the planning process (as depicted infigure 1) are:• Market review• Financial review• Corporate strategy• Product strategyProduct Roadmap and Release schedules During the firststep, product management presents a market review toexecutive management sharing facts on market trends andopportunities, key customer needs, and competitor movesand positions. Though product management will keep tabsthroughout the year on many of these items, this is theopportunity to update the information to make sure it iscomplete and current. Other functions may be invited toprovide their perspectives on the market and customers aswell. During the financial review phase, the financeorganization presents results on the financial performance for the company overall, for its sales channelsand for its products. Providing revenue and profitability by product is critical to making good productdecisions and developing effective strategies.The next step is where the company‟s executive teamoutlines its corporate strategy in terms of its vision, financial goals and its plan for achieving those goals.The corporate strategy should be explicitly presented to the product management team to facilitatedevelopment of a product strategy. For some smaller businesses, steps 3 and 4 may be combined into asingle step.During step 4, product management develops its product strategy considering marketdynamics, customer needs, financial goals, and corporate strategy
Organizational Plan:Process of transforming organizational objectivesinto specific management strategies and tacticsdesigned to achieve the objectives. Organizational planning is one of the most important management responsibilities…Organizational Strategic Planning process:Step 1: Clarify the problem or opportunityStep 2: Outline the process for developing andselecting strategiesStep 3: Establish criteria for successStep 4: Brainstorm, prioritize and select viablestrategiesStep 5: Articulate clear, measurable action plansStep 6: Define ways to measure progress andsuccess . One step solution : Human Concepts to create and implement effectiveorganizational plan. The elements of organizational planning anddevelopment are interrelated, dynamic, andinterdependent as shown in the followingillustration:Strategic planning is one of the most importantresponsibilities of the senior management of anorganization. It is the vehicle that seniormanagement should use to set theorganizational vision…
Financial PlanFinancial planning provides direction and meaning toyour financial decisions. It allows you to understandhow each financial decision you make affects otherareas of your finances. For example, buying a particularinvestment product might help you pay off yourmortgage faster or it might delay your retirementsignificantly. By viewing each financial decision as partof a whole, you can consider its short and long-termeffects on your life goals. You can also adapt moreeasily to life changes and feel more secure that yourgoals are on track.Best Practices when approaching Financial Planning1.1. Set measurable goals.2. Understand the effect your financial decisions haveon other financial issues.3. Re-evaluate your financial plan periodically.4. Start now – don‟t assume financial planning is for when you get older.5. Start with what you‟ve got – don‟t assume financial planning is only for the wealthy.6. Take charge – you are in control of the financial planning engagement.7. Look at the big picture – financial planning is more than just retirement planning or tax planning.8. Don‟t confuse financial planning with investing.9. Don‟t expect unrealistic returns on investments.10. Don‟t wait until a money crisis to begin financial planning.A good financial plan can alert an investor to changes that must be made to ensure a smooth transitionthrough lifes financial phases, such as decreasing spending or changing asset allocation. Financial plansshould also be fluid.
Q5: b) Success of SME’s in Pakistan would promote entrepreneurial mindset and would be a clear indicator of healthy economic growth in the country. Support this statement with examples.As defined by State Bank of Pakistan - SME (Small and Medium Enterprise) means “an entity, ideally not a public limited company, which does not employee more than 250 persons (if it is manufacturing concern) and 50 persons (if it is trading / service concern) and also fulfills the following criteria of either „ a and c or „b and „c as relevant:(a) A trading / service concern with total assets at cost excluding land and buildings up to Rs 50 million.(b) A manufacturing concern with total assets at cost excluding land and building up to Rs 100 million.(c) Any concern (trading, service or manufacturing) with net sales not exceeding Rs 300 million as perlatest financial statements.SMEs are considered the engine of economic growth in both developed and developing countries, asthey:Provide low cost employment since the unit cost of persons employed is lower for SMEs than for large-sizeunits. Assist in regional and local development since SMEs accelerate rural industrialization by linking itwith the more organized urban sector.Help achieve fair and equitable distribution of wealth by regional dispersion of economic activities.Contribute significantly to export revenues because of the low-cost labor intensive nature of its products.Have a positive effect on the trade balance since SMEs generally use indigenous raw materials.Assist in fostering a self-help and entrepreneurial culture by bringing together skills and capital throughvarious lending and skill enhancement schemes.Evidence to Support Hypothesis:Pakistan: Various attempts at evolving Small Enterprise Policy:Small Enterprise Economic and Social Development Policy Paper: Recommendation for Punjab Government
SME in Pakistan “SMEDA SME Policy Paper 2007”The policy was announced in 2007It has at least come up with the definition.It has focused on four (4) main areas for development: -1. Business Environment2. Access to Finance3. Human Resource Development4. Support to Technology up-gradationSome of the highlights of this paper are:Banking & Finance Related Issues.That all provinces should be allowed to establish Small Enterprise Development Banks“Training Prior to Lending Scheme”That a Small Enterprise Guarantee Bank be establishedThat Venture Capital Finance Institutions should be encouragedTax Registration should be made easy and mandatory for Loaning requirement.Network of Small Enterprises Agencies.It requires the introduction of Entrepreneurship courses from High School to Postgraduate level.Setting up of Business Incubators and Technology Parks to support the survival and growth of smallenterprises and entrepreneurs. Evidence: Enterprising Culture:It will touch such aspects as: -1. Education Policy,2. Industrial Policy,3. Financial Policy,4. Internationalization,5. Technical Training6. Culture Development Process