UGC NET COMPLETE NOTES OF UNIT-10 WITH MCQ

1. DIWAKAR EDUCATION HUB
2019
UNIT-10
ENTREPRENEURSHIP
MANAGEMENT
AS PER NEW UPDATED SYLLABUS
SPECIAL THANKS Dr. Mahesh Sharma
Also contribute by – DIWAKAR RAJPUT & NEHA SHARMA
N O . 1 S U P P O R T I V E I N S T I T U T E U G C - N E T

2. Entrepreneurship Development
Entrepreneurship development is the process of improving the skills and knowledge of
entrepreneurs through various training and classroom programs. The whole point of
entrepreneurship development is to increase the number of entrepreneurs.
By doing this, the pace at which new businesses or ventures are made gets better. On a
wider level, this makes room for employment and improves the economy of a business
or country. The steps below will explain how to create an effective entrepreneurship
development program and how to go about enhancing it.
1. Outline the objectives of the program and focus on the venture
development
Entrepreneurship development aims at individuals who want to start or possibly expand
a business. Entrepreneurship development also focuses a lot on enhancing the ideas
and potential of an entrepreneur.
The aims of a program have to be clearly explained otherwise the program will never
reach its full potential. The development of a venture also has to be outlined in the
program. Without these two, there will be no clear goal.
2. Select educated people who have high entrepreneurial potential
An entrepreneurship development program requires that various people be selected.
However, most programs tend to look for a specific group of educated people rather
than target everyone. Ideally, you have to look at the education and traits that you are
looking for, in an entrepreneur, and match them with the people who have applied for
the program.
Most people say that public funds should be spent on people who need the most help.
The resources of an entrepreneurship development program are usually (and
unfortunately) limited. It is hence better to choose people who will prove to be really
useful and benefit the entire community.
3. Select uneducated people who have high entrepreneurial
potential
A development project on women’s entrepreneurship in Nepal was recently conducted. It
was found that women who couldn’t meet the essential needs of their family or
themselves were usually more eager to learn about different ways to earn money as
compared to women who were better off. However, such women usually face many
problems.
Even though such women are not educated, they have great entrepreneurship potential
because they have the right motivation. Such people need to be aided by assistance
packages where training can be given on entrepreneurship. This will instill confidence
and teach them the skills they need in order to provide for their family.
4. Identify the local market and search for people who have
potential in it

3. Entrepreneurship development programs should first identify the local market and aid
potential entrepreneurs who know a lot about it. These people need to be able analyze
and then design unique ideas based off the needs of their surroundings.
By concentrating on select local entrepreneurs, the effects of the program can be easily
and quickly seen within the community. Later on, programs can help improve their
knowledge in their sector. In fact, it is creativity and the thirst for innovation that truly
matters rather than the market’s size. In later programs, the introduction of new products
and product features can be added. This will add value and increase the size of the
market
5. Provide support through private sector-based organizations
Support should be obtained from private organizations that are both financial and
knowledge-based. This helps reduce the cost of the entrepreneurship development
program and increases its effectiveness.
Private organizations that could support entrepreneurship development programs
include universities, consulting companies and various NGOs. Large enterprises are
also encouraged to support entrepreneurship development programs as this their
sponsorship that will help reduce unemployment.
6. Provide an easy yet detailed methodology that will help
entrepreneurs improve in the short and long-run
Entrepreneurial development programs aim at being simple to understand and teach
skills that entrepreneurs can use after the program. It also contains courses that aim at
developing their skills and ideas. These are required if entrepreneurs wish to
successfully exploit the local market.
They also need to be taught how to gather the required resources in order to meet the
goals of their venture. The program also needs to have outlined methods through which
entrepreneurs can improve the performance of their business in the long run.
Entrepreneur development training proves to be highly effective when finance, quality
assurance, marketing and productivity are linked to the training program. As an example,
when development banks are involved earlier in the process of training, an entrepreneur
will easily understand credit processes and the also praises the bank’s business plan.
7. Implement special measures to improve the usefulness of
trainers and facilitators
The Success of an entrepreneurship development program also relies on the
commitment and quality of the many facilitators and trainers. Any trainer or facilitator in
the program needs to understand the culture and lifestyle of the group in order to better
integrate themselves and serve the group.
The selection of proper trainers is based on the amount of business experience they
have and the how much knowledge they have about their local business environment.
Training facilitators can significantly improve their usefulness in tackling the needs of
entrepreneurs.
8. The selection of areas for pilot programs must be right

4. Entrepreneurship development programs are usually too restricted in terms of where it is
done and what people are involved in the program. Selecting pilot target areas will
usually depend on the ease at which support institutions are available.
It will also depend on the interest people take in entrepreneurial development programs.
These facts can never be the same for any two geographical locations and hence must
be considered carefully.
9. Launch pilot ED programs and develop as needed
Analyzing pilot feasibility is an effective way of launching a major entrepreneurship
development program. If the program shows signs of high promise, it can be launched
on a national level. By relying on the sponsors for support rather than donor support, the
program will be able to expand past local development while maintaining high quality.
This is especially important when the support of donors starts to fade.
10. A successful entrepreneurship development program
requires government policies
Entrepreneurship helps the economy of a country grow and creates new jobs.
Government policies usually have a substantial impact on the number of entrepreneurs
in a country.
While there are many governments that say they do support entrepreneurial businesses,
they usually do not have many specific policies and programs that effectively support
entrepreneurial development.
Creating an effective entrepreneurship development program may not be easy but then
again, it is not impossible either. By carefully following the ten points above, you are well
on your way to creating an entrepreneurship development program that not only benefits
your company in the short run but in the long run as well.
Process of Entrepreneurship Development
In a very general sense, development refers to enhancing an existing potential or
asset through the process of learning and application. It is a process of evolving
one’s skills in a systematic manner. Therefore, same goes for the process of
entrepreneurship development. But before we dive headfirst into the process of
entrepreneurship development, let us first shed some light upon what the term
entrepreneurship development entails.

5. Definition of Entrepreneurship Development
Basically, entrepreneurship development is basically the process of improving the
skill set as well as the knowledge of the entrepreneurs. This can be done through
various methods such as classroom sessions or training programmes specially
designed to increase the entrepreneurial acumen.
Another definition of this term could be the process of enhancing the capacity to
develop, manage and organize a business venture while keeping in mind the risks
associated with it.
But instead of complicating things with big words and sophisticated
terminologies, let us understand it simply. The process of entrepreneurship
development is nothing but helping the entrepreneurs develop their skills through
training and application of that training. It instils in them the quality of making
better decisions in the day to day business activities.
Now that we understand the meaning of entrepreneurship development, let’s
discuss the process of entrepreneurship development.
Process of Entrepreneurship Development
Clear View of the Objective of the Program
Before you get into training the prospective entrepreneurs, it is very important to
have a clear objective and plan in mind about what the program is going to
encompass.

6. Without a proper plan and direction, the training would not yield the desired
results. This would lead to a loss of time, money, effort and most of all, valuable
potential.
Selecting the Potential Targets
It is important to select the potential targets who are willing to enhance their skills
and who can be identified as the people who have some amount of business
acumen. These can be further divided into two categories- the educated target
audience and the uneducated target audience.
Educated audience refers to the target people who have a decent educational
background and want to be entrepreneurs. These people have the motivation to put
their education to use by starting a venture and working for themselves.
Uneducated audience refers to the people who are not as privileged as others in
terms of education about the market and have the potential to become
entrepreneurs. These people are constantly looking for alternative ways to earn
money and support their families. Therefore they are highly motivated and, given
the right training and direction, can prove to be exceptional entrepreneurs.
Identifying Local Talents and Markets
The process of entrepreneurship development program can be seen as most
effective and efficient when it is applied in the local markets and on the local
entrepreneurs who know about it. These people understand and absorb the
knowledge way more quickly and can apply it in the current scenario because of
which the results of the program can be seen more quickly and effectively.
Choosing the Right Location
In India unfortunately, these programs can only be launched where support
institutions and resources are available, but ideally, these programmes should be
planned and launched in the areas where most people are interested and willing to
take advantages of these programmes so that this opportunity can be used most
effectively and there is no loss of resources.
Tying up with Institutions
A lot of times these programmes involve tying up with various institutions like
universities, NGO and some private institutions. This is done to give a real-world

7. experience to assist the program and give the people some idea of the situations in
the real world.
Develop the Entrepreneurship Program as Needed
People and their skill sets are different and develop over time. Thus, it is very
important to keep developing the programs to suit the needs of the people enrolled
in it. Moreover, the focus must be on harnessing their strengths and working to
minimize their weaknesses.
Analyze the Result for Future Development
This is a very important and final step in the process of entrepreneurship
development. After the program has run its course, it is very important to analyze
the effectiveness of the program. This is necessary to ensure that in future more
effective programs can be developed. For this one has to minimize the
shortcomings of the existing program.
Solved Question for You
Question: Is entrepreneurship development important for existing entrepreneurs?
Answer: Entrepreneurship development programs are developed for both aspiring
as well as existing entrepreneurs. This is because these programs are also designed
to help the entrepreneur expand their existing enterprise. These programs are more
effective on the existing entrepreneurs. It is because they already know a lot about
their markets and industry. Hence can effectively apply the learnings in their
business and analyze the results more quickly,
Entrepreneurial Competencies
KEY CONCEPT
Is there such a thing as a ‘natural-born entrepreneur’? According to this Idea there is not. Specific
techniques and habits must be practiced and developed by all would-be entrepreneurs. And as well as
business competencies, entrepreneurs need interpersonal and self-leadership skills too; however, these
are often overlooked. Read on for advice on how to build and put these skills into practice.
IDEA SUMMARY
Are entrepreneurs born or made? Commonly, characteristics such as risk seeking, assertiveness and
vision are considered typical of a successful entrepreneur. But these are innate predispositions or

8. aspects of temperament; by using them as yardstick, it is wrongly concluded that only certain types of
people make good entrepreneurs or are capable of worthwhile innovations. Instead, this Idea proposes
that ‘entrepreneurial behaviour’ can be learned and developed.
The question is not who entrepreneurs are, but what they do, and more important than business skills
can be other competencies that provide a foundation for those business skills.
The research behind this Idea is based on empirical studies of hundreds of entrepreneurs, which
revealed that entrepreneurial behaviour is the result of a combination of:
 strong motivation to achieve something; and
 the capabilities to achieve it.
Furthermore, there are three levels of competencies, which all entrepreneurs need:
1. Personal competencies: creativity, determination, integrity, tenacity, emotional balance and self-
criticism.
2. Interpersonal competencies: communication, engagement/charisma, delegation, respect.
3. Business competencies: business vision, resource management, networking, negotiating skills.
Previous research has also highlighted other competencies that make up the ‘ingredients’ of a
successful entrepreneur, including initiative, ambition and even luck.
BUSINESS APPLICATION
Though the key take away from this Idea is that entrepreneurship can be learnt by anyone, it’s not
something that can simply learn in a classroom. Even once key business knowledge has been
acquired, the entrepreneur still has to learn how to use it in practice - something that can only be done
through practice. In this respect, ‘leaning by doing’ is useful. Other tips include the following:
 Have a clear understanding of industry evolution, knowledge of the effects of globalization,
techniques for developing markets, etc. Some training in an academic environment (e.g. business
schools) may help with this, particularly where case methods/working groups are used to teach.
 Practice developing your interpersonal competencies. Certain skills, such as communication,
delegating and respecting others can only be acquired through practice and developing ‘habits of
character’.
 Habits of character may not strictly be related to business but are to do with the kind of person the
entrepreneur is and what he/she does. These are indispensable, alongside ‘technical habits’ and
‘skills’.
 The only way to acquire the habits essential for entrepreneurs is by acting in a way consistent with
them. Only then do these habits become the ‘driving force’ of successful entrepreneurial ventures.

9. Literature Review and Hypotheses
Competencies are defined as measurable or observable skills, knowledge, abilities and behavior of an individual
that would allow him or her to lead a successful life, or work activities. According to Businessdictionary.com,
competence or competency can be defined as “A cluster of related abilities, commitments, knowledge, and skills
that enable a person (or an organization to perform effectively in a job or situation. Competence indicates
sufficiency of knowledge and skills that enable someone to act in a wide variety of situations. Because each level
of responsibility has its own requirements, competence can occur in any period of a person’s life or at any stage
of his or her career. In the same manor, competencies acquired by Entrepreneurs would help them lead a
successful and responsible business and would help them sustain and grow their new businesses once
developed. To this end, we believe that previous researches did not define a single set of competencies that
would fit for all purposes; in fact, this largely depends on the purpose of use. Therefore, employees required
competencies vary significantly, based on the purpose or position within a particular organization. It may also
vary from one industry to the other, though; previous work done on competencies for successful Entrepreneurs
did not distinguish the required competencies for the different industries in the Entrepreneurial context [1],
however, argues that competencies of Entrepreneurs can be defined as base features such as: traits, motives,
self-image, skills and knowledge, eventually resulting in creating a new venture, and further survival and growth
[2] defines Competencies as people’s characteristics that enhance their performance or effectiveness at work.
Sanchez argues that those competencies apply to successful managers and in turn he further argues that
characteristics apply to successful Entrepreneurs. Sanchez also believes that those characteristics or skills can
be trained and developed in Entrepreneurs as well as Managers. According to Wei et al. [3] believe that startup
Entrepreneurs despite having a good project and further exerts serious efforts to succeed, they end up in failure.
They argue that, there are several reasons behind this failure, yet they concluded that both Entrepreneurial
personality and competencies have a very high significance among all reasons.
Many researchers have studied the core competencies that are the key for Entrepreneurs to succeed.
Mitchelmore et al. (2008) argue that the term competency holds at least two distinct meanings: behavioral
competency, which an individual possesses and demonstrates, and performance-related competency, being a
minimum standard of performance. According to Bird [1] competencies necessary to launch a new venture or to
plan a new venture may be conceived as “baseline” and highly effective Entrepreneurs are those who go beyond
launching and into organizations that survive and grow. Furthermore, Bird debates that competencies can be
acquired through learning, and, therefore, it is important to identify those competencies as an opportunity for
learning to improve on the success factor of Entrepreneurs. From the above, it is, therefore, required to split
competencies into Entrepreneurial sets of competencies; that would help an Entrepreneur establish a business,
but then the sustainability of the business is only achieved through the managerial set of competencies acquired
by the Entrepreneur to move to the next level. In between those two sets of competencies, there lies a wider
range of competencies including the human relations and communication competencies [4] split out the core
competencies into two distinct groups and argued that those are the most important competencies; those were
Entrepreneurial competencies, and Managerial Competencies. They have further defined the Entrepreneurial
competencies as those necessary to identify and envisage the opportunity, while acting on it to capture and
benefit from that. While, they defined the managerial competencies as those required for capturing and utilizing
essential resources to pursue business interests and related deeds [5] argue that managerial skills are different
from the Entrepreneurial skills. However, for successful Entrepreneurs both sets of skills go hand in hand to
ensure a continuously successful growing business. Richardmore et al. (2008) believe that, there is a set of four
competency groups that help an enterprise to be established and grow: a) Entrepreneurial Competencies, b)
Business and Management Competencies) Human Relations Competencies (HRC), d) Conceptual and relations
competencies suggest that there are 17 competencies for successful Entrepreneurs sub-grouped in six groups,
they suggest that not all successful Engineers and scientists are as well successful Entrepreneurs; Entrepreneurs
are subject to Entrepreneurships opportunity identification and management through gaining from those
opportunities. According to Zafar and Khan ] argues that personal capabilities and leadership skills are factors
affecting success experience and knowledge. Zafar and Khan, [] and Cox and Jennings (1995) believe that
decision-making and its innovativeness are key factor towards success [further identify opportunity recognition as
an important characteristic of Entrepreneurs also, state that the enterprises with managers who have high levels
of Entrepreneurial competencies have always been successful; they are also characterized for their ability to
scan the environment for new opportunities and thus position their ventures towards achieving the required
sustainable success that every Entrepreneur strives to achieve. Mitchelmore et al. (2010), propose a clustered
set of 4 categories as Female Entrepreneurs Competency model for which all the 41 competencies were
grouped.
To conclude, there has been a consensus that a successful Entrepreneur should be visionary enough to see his
established firm goals and objective. He/she should be able to identify the opportunities and act on to capture
those opportunities utilizing a set of Entrepreneurial Competencies. He/she should be able to lead his established
enterprise through the path towards success. This requires the Entrepreneur to establish a set of Business and
Management Competencies, and in order to do so, he/she should be able to select the right team to help him
achieve the goals, which requires the Entrepreneur to have some level of Human Relations Competencies to be
developed. Throughout the life of his newly established enterprise, he/she will need to sell his ideas to different
stakeholders, which requires him/her to have a certain level of Business Development and Conceptual and

10. Relationship Competencies. To this end, this paper is based on [3] model that comprises 17 unique
competencies, clustered into 6 competency groups as well as Mitchelmore et al. proposed set of competencies.
Furthermore, the initial list was reviewed with 6 successful Egyptian Entrepreneurs and ended up with a
proposed of 5 clusters of Entrepreneurial competencies that to be tested in the Egyptian context as follows:
Entrepreneurial competencies: A set of competencies which would allow the Entrepreneur to identify and capture
opportunities in the environment, but would also require innovation and creativity as well as being adaptable and
quick in responding to changes. The subset would include 5 distinct competencies as follows: a) Scan
environments for opportunities, b) Innovation and Creativity and Idea generation, c) Willingness to take risks, d)
Fast and dynamic, f) Adaptability and Proactivity.
Conceptual and relationship competencies: This competency includes a mix of relationship building
competencies and personal traits, the subset would include 5 distinct competencies: a) Conceptual and
relationship competencies, b) Perseverance, persistence and Desire to succeed, c) Self-confidence and Self-
motivation, c) Interpersonal and Oral communication skills, d) Integrity, f) Political competence.
Business development competencies: Once an idea is created, and an opportunity is captured, then comes the
importance of idea selling to the partners, investors, co-workers, customers and the public, in order to generate
revenues and sustain success. The subset includes 5 distinct competencies as follows: a) Visioning, b) Idea
selling, c) Marketing selling, d) Relationship building and networking, f) Formulating and implementing strategies
for exploiting opportunities.
Human relations competencies: Those include skills and competencies typically shared by a HR functions and
business line functions in larger organizations. They include Leadership, selection, hiring and staffing and
employee development and motivation. The subset includes 5 distinct competencies and skills as follows: a)
Leadership skills, b) Selection and hiring a diversified team, c) Employee development and Performance
Management, d) Motivate others, f) Management skills.
Business and management competencies: The factor includes competencies relating to a typical range of
‘business tasks’ such as: technical expertise in the relevant business, Management skills, and planning and
budgeting skills. The subset includes 5 distinct competencies or skills as follows: a) Technical skills, b)
Developing management systems, c) Development of operational systems, d) Planning business activities, f)
Problem solving.
Moreover, through the review of literature around Entrepreneurs’ success, researchers have not agreed to a
single definition of Entrepreneurial success specially when measuring success of newly created enterprises, in
fact [6] concluded that there are few reasons for this: a) Nascent firms have difficulty measuring their success in
the conventional methods since they lack the standardized accounting measures and performance indicators. b)
Comparing different industries and service sectors make it difficult as each acquire unique financial basis and
thus incomparable. c) New firms tend not to share or disclose financial results. d) In addition and through
interviews with Egyptian SMEs, it shows that the majority of the new businesses operates in a parallel or informal
economy, and, therefore, is unwilling to share formal financial results conclude that most researchers go a
distance from measuring success in the conventional way and use subjective measurements of success argue
that financial results, although easily quantifiable, but are far from being the sole important measure. They
suggest that the initial subjective success is measured as a combination of several factors: a) Attaining
Entrepreneur’s expectations, b) Survival, c) Ability to attract outside capital. They further argue that the value
addition and uniqueness of the innovation attributes to the success; innovation can apply to either product or
service. Therefore this paper suggests using the following criteria to measure Entrepreneurs’ success: a)
Sustainability of business: According to Hattab a successful new Entrepreneurial venture has an age between 3
and 42 months (3 ½ years). b) Ability to attract additional outside capital: a successful new venture with
promising returns has the ability to attract outside capital. It is, however, not essential for successful
Entrepreneurs to grow through acquiring outside additional capital. Rather, some prefer to grow organically, but
their ability to attract outside capital is an indication of being a successful new Entrepreneurial venture. According
to Stefanovic et al. (2010), access to capital, is one of the factors affecting success. c) Growth (Revenue, Sales,
Labor, customer base etc.): according to Perez and Canino the most indicative factor used to measure success
was the company’s growth, this contributed to a significant 31% of all indicators in the journals reviewed. Growth
is attributed to profit, revenues, manpower or customer base. d) Providing value added product/service: Carlend
et al. (2002) argue that the distinguishing factor between an Entrepreneur and small business owner is the
innovation and tendency to growth provided as part of the venture strategy.
H1: There is a positive linear relationship between Entrepreneurial Competencies and success of the
Entrepreneurs in Egypt.

11. H2: There is a positive linear relationship between Entrepreneurs Conceptual and Relationship Competencies
and the success of the Entrepreneurs in Egypt.
H3: There is a positive linear relationship between Entrepreneurs Business Development Competencies and the
success of the Entrepreneur in Egypt.
H4: There is a positive linear relationship Entrepreneurs Human Relations Competencies and the success of the
Entrepreneur in Egypt.
H5: There is a positive linear relationship Entrepreneurs Business and Management Competencies and the
success of the Entrepreneur in Egypt.
Method Participants
The researchers conducted a comprehensive literature review for previous researches completed in the area of
Entrepreneur’s Competencies required for successful startup of business, and the area of success measurement
of nascent business. A semi-structured interview of 7 SMEs followed the literature review stage, 6 of those were
successful Entrepreneurs, while the seventh had discontinued the business as he had experienced difficulties. All
7 SMEs contributed to the enhancement of the literature reviewed proposed model to match the Egyptian market.
During the early stage of this research, a qualitative approach was followed through the SMEs interviews to
enable better understanding of the subject. Later after landing to a proposed model, and development of
research hypothesis, a quantitative approach was followed through the dissemination of the survey
questionnaire, analyzing the results and concluding the statistical outcomes to test the relationship between the
variables. According to Egyptian Junior Businessmen association based in Cairo-Maadi, there are circa 600
business executives and Entrepreneurs registered on the active membership of the association, and accordingly
a convenient sample of 86 were selected for the dissemination of the survey questionnaire, yet only 42
responded to the survey, with 2 incomplete surveys, resulting in a response rate of 49%, and complete survey
respondents of 47% of the sample.
Procedure
Based on the type of data of this research, the Logistic linear analysis is used to modify the model. The
dependent variable, Entrepreneur’s success and all its dimensions, are binary variables. If the dependent
variable (Y), is one of the binary response or dichotomous variable, such as Male/Female, Yes/No, Success/Fail,
Present/Absent or Smoking/ Nonsmoking, logistic regression can be used to describe its relationship with several
predictor variables, X1,X2,…,X-k and an (adjusted) odds ratio can be estimated [12] for a binary response, y, the
expected value of y, E(y)=π, where π denotes Probability P(y=1). The log model is:
Equation: Logistics Model
Through algebraic manipulation the above formula can be represented as follows:
Notice that although the regression model is linear on the right side, the left side is a nonlinear function of the
response variable π.
Also, since π=P(y=1 or success), then 1–π=P(y=0 or failure).
The ratio is known as the odds of the event y=1 or success occurring.
Six distinct logistic regression analyses were conducted in this study; one distinct regression for each of the five
dimensions and a collective regression at the end [13-16]. To reach the best model that fits the data, the
backward stepwise method was used to reach the set of all significant variables [17,18].

12. Intrapreneurship
Definition: An Intrapreneurship is the system wherein the principles of entrepreneurship are
practiced within the boundaries of the firm. An intrapreneur is a person who takes on the
responsibility to innovate new ideas, products and processes or any new invention within the
organization.
An intrapreneur is the individual who thinks out of the box and possesses the leadership skills
and does not fear from risk. Thus, an intrapreneur possesses the same traits as that of an
entrepreneur.
The concept of an Intrapreneurship can be well understood in contrast to the entrepreneurship.
Following are the points of distinction between these two terms:
1. Intrapreneurship is restorative in nature, i.e. an organization encourages the employees to
practice the entrepreneurial principles to counter stagnation within the firm or transform the slow
growth of the company into a high-growth. Whereas the entrepreneurship is developmental in
nature, i.e. an individual creates something that has never existed before, such as a new
product, process or a new venture itself.
2. In intrapreneurship, the major challenge that individual faces are from the company’s
culture itself. Sometimes, the corporate relationships and the mindsets of employees acts as a
hurdle in the path of an intrapreneur. Whereas, in the case of entrepreneurship, the market is the
only enemy. An entrepreneur has to scrutinize the market conditions thoroughly to cross the
hurdles coming in his way.

13. 3. An intrapreneur has an access to firm’s resources such as funds, manufacturing setups,
marketing facilities, and other supporting activities to give shape to his dreams. Whereas an
entrepreneur has to arrange his own resources such as own funds or the borrowed funds,
manufacturing facilities, marketing facilities, etc.
4. An intrapreneur does not have the ownership of a new venture and is not even independent to
take decisions, whereas an entrepreneur is the whole sole owner of the new venture established
by him. Also, he is independent to take any decisions with respect to his setup.
Thus, an Intrapreneurship is a practice of creating the entrepreneurial environment within the
organization, thereby enabling the employees to apply their entrepreneurial skills in the job roles;
they are assigned to.
Defining Intrapreneurship
Intrapreneurship means behaving like an entrepreneur while working within a large organization.
LEARNING OBJECTIVES
Define intrapreneurship as a means of enabling organizational change and the pursuit of an innovative culture
KEY TAKEAWAYS
Key Points
 The intrapreneur acts as an “inside entrepreneur ” who focuses on innovation and creativity
while operating within the goals and environment of an organization.
 Intrapreneurs bring their ideas to the firm to generate new products, processes, or services and
thereby act as a force for change within the organization. Intrapreneurship adds to the
innovation potential of an organization.
 In many ways, the benefits of intrepreneurship are difficult to forecast and thus difficult to
justify. As a result, good managers must be long-term oriented and open-minded to implement
entrepreneurship.
Key Terms
 entrepreneur: A person who organizes and operates a business venture and assumes much
of the associated risk.
 innovation: A change in customs; something new and contrary to established customs,
manners, or rites.
Intrapreneurship means behaving like an entrepreneur while working within a large organization.
According to social scientist Joseph Schumpeter, introducing new technologies, increasing efficiency
and productivity, and generating new products or services are all qualities characteristic of
intrepreneurs.
Intrapreneurs and Corporate Management
Intrapreneurship is now known as the practice of a corporate management style that integrates risk-
taking and innovation approaches. It also incorporates the reward and motivational techniques that
are traditionally thought of as being the sole province of entrepreneurship.

14. The intrapreneur acts as an “inside entrepreneur” who focuses on innovation and creativity while
operating within the goals and environment of an organization. Intrapreneurs bring their ideas to the
firm to generate new products, processes, or services and thereby act as a force for change within the
organization. Capturing a little of the dynamic nature of entrepreneurial management (trying things
until successful, learning from failures, attempting to conserve resources, and so on) adds to the
innovation potential of an otherwise static organization without exposing those employees to the risks
or accountability normally associated with entrepreneurship.
Theory and Practice
Incorporating entrepreneurial concepts into traditional corporate environments is easy to promote in
theory: capturing the innovative attitudes of small start-ups within the larger organizational context
(i.e., with more resources) seems intuitive. In reality, entrepreneurship is often much easier to discuss
in a classroom than to integrate into an actual organization. There are many reasons for this that
generally boil down to simple issues of size and corporate inertia.
Companies are built on structures and hierarchies which in turn create a dependable and repeatable
operational process. This process leads to value creation, and efficiency is always a focal point in
operational contexts. When innovation and intrepreneurship enters this equation they are often seen
as costs without tangible and definite benefits, and as lacking consistency and applicability to the
current model. In many ways, the benefits of intrepreneurship are difficult to forecast and thus difficult
to justify. As a result, good managers must be long-term oriented and open-minded in order to
capture the benefits of instilling an intrepreneurial spirit.
Building Support for Intrapreneurship
Building internal support for intrepreneurship is a prerequisite to creating meaningful change in an
organization.
LEARNING OBJECTIVES
Justify the role of the intrapreneur, not only as an innovative thinker but also a strategic communicator capable of
initiating change organizationally.
KEY TAKEAWAYS
Key Points
 An intrapreneur is tasked not only with creating a new and innovative concept but also with
communicating the concept in a way that builds support for the new initiative.
 One useful way to integrate stakeholders and speak the language of upper management is to
numerically demonstrate that a new idea is financially and strategically feasible.
 Building support by identifying and communicating with key stakeholders and decision -makers
is essential to bringing change to an organization.
 Intrapreneurs must also be willing to become change agents: people who act as catalysts for
incorporating new ideas within the organization. Intrapreneurs, from this perspective, must
display strong leadership and communication skills.
Key Terms
 comprehensive: Broadly or completely covering; including a large proportion of something.

15. Building support is important when you are bringing change to the organization. Employees bold
enough to be intrepreneurs must recognize the challenge they are taking on from the organizational
frame. Organizations have great momentum and are, in most cases, inherently resilient to change.
This places a great strain on an innovative employee with an interesting idea because s/he is tasked
not only with implementing the idea but also with communicating it to key decision-makers to gain
approval.
Key Stakeholders
Intrapreneurs need to know who the key stakeholders are and how to capture their attention. For
starters, upper management is often where the decision-making power lies. Having access to upper
management, and understanding the strategic motivations behind their decisions, plays an integral
role in building top-down support organizationally. Customers are also key stakeholders because their
needs are the primary determinant of organizational trajectory. Recognizing what customers want and
learning how to give it to them more effectively are integral to successful intrapreneurship.
One useful way to integrate stakeholders and speak the language of upper management is to
numerically demonstrate that a new idea is financially and strategically feasible. A net present value
(NPV) analysis factors in the total time it will take to initiate a new project, along with costs incurred
and value generated over a given timeframe. This enables intrapreneurs a tool to communicate, in
today’s dollars, how much a given new venture will cost compared with how much it will bring in (i.e.,
a profit margin).
Leadership Strategies for Change
Successful change management is more likely if leaders:
 Create a definable strategy – Define measurable stakeholder aims, create a business case for
their achievement (and keep it continuously updated), monitor assumptions, risks,
dependencies, costs, return on investment, and cultural issues affecting the progress of the
associated work.
 Communicate effectively – Explain to stakeholders why the change is being undertaken, what
the benefits of successful implementation will be, and what how the change is being rolled out.
 Empower employees – Devise an effective education, training, or skills upgrading scheme for
the organization.
 Counter resistance – Identify employee issues and align them to the overall strategic direction
of the organization. Adapt the change initiative when necessary to mitigate discontentment.
 Support employees – Provide personal counseling (if required) to alleviate any change-related
fears.
 Track progress – Monitor the implementation and fine-tuning as required.
These six components of change are the responsibility of management to create and implement.

16. Rural Women Entrepreneurs: What does it take?
Sabse jyada munafa chuski mein hai (The biggest margin lies in small ice pops)”, says Shanti Devi with the definitive
confidence of a seasoned entrepreneur. Shanti, a resident of Kotwana village in Bihar’s Gaya district runs an ice-
cream production and sales unit that has an annual revenue of INR 1.9 million and employs 22 workers for a
significant part of the year. While sharing the long list of ice-cream flavours she vends, Shanti also signals at a
much larger phenomenon. “Every third shop in this market is run by a JEEViKA member, ranging from grocery
and utensil stores to a newspaper agency.”

17. Shanti is the microcosm of a transformative ecosystem that has nurtured 1.8 million new and existing women
entrepreneurs while creating 800,000 new jobs in India. The JEEViKA that Shanti refers to, is a World Bank
supported program of the Government of Bihar aimed at empowering women through Self-Help groups (SHGs),
commodity specific producer groups and higher federations. The approach scaled up nation-wide under
the National Rural Livelihoods Mission (NRLM) is driving growth and job creation in rural areas through women-
owned enterprises.
Today there are 45 million rural women across India that are mobilized into self-help groups under the NRLM
umbrella. Some 3.9 million SHGs and their federations have been empowered with skills, access to finance,
markets, and business development services. This is triggering a huge change in the lives of the rural women.
Women: Harbingers of Change
Now women are taking charge, becoming entrepreneurs, and providing jobs to other women.
Over the past 15 years the World Bank has invested USD 3 billion in the unique approach referred to as the rural
livelihoods approach to women’s economic empowerment.
The institutions have leveraged USD 25 billion of formal credit over the last five years fuelling a virtuous cycle of
productive investment and enabling households to diversify and enhance incomes.
Technical assistance and direct links with some of the biggest private sector companies such as Walmart, Olam,
ITC India, NCDEX and TechnoServe are helping bridge the gap between demand and supply, creating more
inclusive value chains that deliver economies of scale for producers while improving efficiency for market players.
The World Bank’s portfolio of agriculture and rural transformation projects in India now totals USD 1.7 billion, out
of which almost USD 500 million focuses on women-centred enterprise promotion.
There are examples galore that demonstrate the efficacy of this approach in driving sustainable enterprises
across sectors.
Women even in active conflict countries such as Afghanistan have run successful enterprises. Miss Rezaee of
the all-women Alghochak Potato Chips Cooperative at Azdar village of Bamyan recalls: “When we first started
making chips, we neither had equipment and expertise to cook the chips nor were there properly established
markets for us to sell to. The Afghanistan Rural Enterprise Development Program (AREDP) provided us the
equipment, training and a direct link to 11 schools in Bamyan where we supply 70kgs of potato chips daily.” The

18. cooperative is one of the 300 small enterprises receiving support from the AREDP, supported by the World Bank
and Afghanistan Reconstruction Trust Fund(ARTF). The program has created employment opportunities for
nearly 12,000 households in Bamyan Province alone. The Government of Afghanistan is now planning to
replicate a model akin to NRLM nation-wide (with twinning arrangements with India) with the support of ARTF
and International Development Association (IDA) – the Women’s Economic Empowerment Rural Development
Program (WEERDP).
Self Employed Women’s Association (SEWA)[1] has connected nearly 800 rural homes in Gujarat in partnership
with AirBnB, generating incomes averaging USD 500 a month for hundreds through a “service enterprise” that is
home based– a preferred option for millions of women in India and South Asia in general. Tourism operators,
transportation services and culinary services have mushroomed in and around these AirBnB homes to cater to
this new clientele. Women have invested considerable sums in their home “enterprises” with better sanitation and
running water facilities to attract clients, now 40 percent of whom are international. Clearly, mentorship at district
and block levels for budding enterprises enhance their success rates. Lean IT based on mobile and cloud-centric
solutions is helping drive many of these enterprises.
Aaranyak Farmer Producer Company in Purnea, Bihar has reached USD 2 million in annual turnover, by
adopting technology-based solutions for collective aggregation of maize from small farmers, delivering
transparent pricing and leveraging online commodity trading platforms to find the most remunerative markets.
Similarly, artisan groups in Madhubani, Bihar have been linked to technical assistance partners for design
upgradation while e-commerce platforms are being utilized for reaching premium market segments.
NRLM has unleashed the latent entrepreneurial energy of millions of women in rural India. With a massive
outreach, the community institution network has the potential to be at once both the enterprise and the market
where small businesses of complementary nature exist and thrive in a symbiotic manner. However, a word of
caution – self-employment through running of small rural enterprises whether for men or women is not always
sustainable.
As Bannerjee and Duflo have pointed out[2] that these are in many cases a means to “buy a job when a more
conventional employment opportunity is not available”. These women rural entrepreneurs will need skills, talent,
and an appetite for risk to grow their small businesses into successful enterprises. We are seeing this happen
now to some extent with a sub-set of these businesses through unique public-private-community partnerships in

19. South Asia that brings in the younger, more educated generations into the running of the business.
For now, the juggernaut of women entrepreneurs rolls on. Shanti, who has accessed INR 500,000 (approx. USD
8000) from her SHG, chuckles “For all I knew, people don’t like ice cream in winters. But I was wrong. This year, I
had a few carts operating in the winter season too with special discounts for my SHG members.” Who says only
big brands know how to build consumer loyalty!
[1] SEWA’s initiatives are independent of the Government of India’s National Rural Livelihoods Mission (NRLM)
[2] Poor Economics, Abhijit Bannerjee and Esther Duflo, Random House India, 2011.
Challenges faced by women entrepreneurs in rural India
introduction
The journey of an entrepreneur, especially a woman entrepreneur, is filled with challenges (Ghosh
and Cheruvalath, 2007; Rai and Srivastava, 2013). More so, if the entrepreneurial venture is in a
rural part of a developing country, as it faces additional challenges of ‘remoteness from markets,
inadequate access to suppliers, lack of skilled labour, etc.’ (Galloway and Mochrie, 2006: 174), and
poor workers, inadequate infrastructure and ‘a culture not supportive of entrepreneurship’ (Ozgen
and Minsky, 2007: 50). While social entrepreneurship has led to the empowerment of women in
India by providing women with ‘economic security, development of entrepreneurial behaviour, and
increased contributions to the family’ (Datta and Gailey, 2012: 569), entrepreneurs continue to face
a variety of challenges. Kumbhar (2013: 193) has summarized various issues faced by Indian
women entrepreneurs in the rural context, including:
absence of definite agenda of life, absence of balance between family and career obligations of
women, poor degree of financial freedom for women, absence of direct ownership of property…, no
awareness about capacities, low ability to bear risk, problems of work with male workers…, lack of
self-confidence…, mobility constraints and lack of interaction with successful entrepreneurs.
Given such myriad problems, it is appreciable that Malavika Sharma, a woman entrepreneur, has
set up an entrepreneurial venture called ‘Avika’1
in a rural part of Jharkhand2
State in India, and
has done well and also greatly benefited the society.
The case of ‘Avika’ provides students of entrepreneurship with a good example of the challenges
faced by women entrepreneurs in rural settings in developing countries. The social entrepreneurial
venture, Avika, has an all-woman workforce comprised of skilled artisans, who produce high-quality
handicrafts using traditional methods, and most of whom only do part-time work from their own
homes. The case helps students understand how the venture has innovatively evolved its business
model to successfully overcome operational and market hurdles. Rapid growth has brought new
challenges and opportunities for the entrepreneur to consider.
We start with a brief overview of Malavika Sharma, the founder of Avika. We then delineate and
describe the myriad problems faced by the venture, the strategies to counter these, and the
evolution of the venture’s business model. We conclude with the strategic alternatives being
considered to overcome the current problems.

20. Key learning outcomes
(1) to gain insight into the operational challenges faced by an entrepreneurial venture employing
uneducated rural women, working part time; (2) to understand the inevitable inter-twining of
business and social issues, given the rural context; (3) to analyse various strategic business-
expansion alternatives; (4) to help understand the socio-cultural and business context of an
emerging economy, specifically India; (5) impact of rural entrepreneurship on community
empowerment/social cohesion and the role of local initiatives.
The case of Avika
As Malavika Sharma put down the phone on a warm afternoon in September 2015, she had
reasons to be happy. She had bagged another large order from a leading Indian clothing retailer,
for supplying hand-embroidered, traditional Indian garments. As she made a checklist of tasks to
execute the order, her thoughts drifted to all that she had achieved in the 7 years since she started
Avika, her entrepreneurial venture. She realized that despite the rapid growth, many challenges
remained, and she needed to remain focused and motivated as ever.
Malavika’s story
The name ‘Malavika’, meaning ‘the princess of the ancient kingdom of Malawa’, has its origins in
the Sanskrit play ‘Malavikagnimitram’ by the famous ancient poet Kalidasa (Wikipedia, 2016). The
story narrates the life of a princess in exile who overcomes all odds to achieve what she truly
desires. These days, Malavika is a popular name for Hindu Indian girls.
In 2004, Malavika Sharma graduated with an MBA from XLRI, a leading business school in India.
She worked as an HR professional with a couple of multinational companies for a few years;
however, unlike most of her MBA classmates who were trying to climb up the corporate ladder,
Malavika yearned to start something of her own, particularly for societal benefit.
Malavika hailed from Brambe, a village in the underdeveloped state of Jharkhand. In 2008, on one
of her visits home, she was deeply moved by the poverty and lack of work opportunities available
to rural women. Encouraged by her mother, Malavika decided to do something about it. Malavika
recalled,
I got up close with women in the hinterland. In many cases, they were the sole breadwinners of their
families…yet led a repressed life. They couldn’t do what they dreamt…were answerable (to male
members of the family) for every little action…I decided to help them earn more money, but above all
some self-respect (Bose, 2012).
She started training rural women to produce hand-embroidered garments. She soon realized that
mere training was not enough. Malavika then used her savings to set up Avika. The objective was
to provide a means of livelihood to poor rural women-artisans. Within a few months of starting her

21. venture, Malavika quit her job, shifted base to rural Jharkhand and pursued her entrepreneurial
venture on a full-time basis.
About the social entrepreneurial venture ‘Avika’
As an organization, Avika was set up to empower rural women through economic development. It
focused on providing training and earning opportunities by producing traditional, hand-embroidered
garments. Starting off with seven women in 2008 (Sharma, 2012), within a few months, the
recently started venture trained nearly 300 women artisans. As there was no local industry to
absorb this trained workforce, she started a manufacturing unit for hand-embroidered garments.
The venture’s workforce grew rapidly, and by 2015, it supported nearly 700 women artisans.
The early challenges
Throughout its early years, the entrepreneurial venture faced numerous challenges (refer Table 1),
including:
Table 1. Historical path of Malavika’s entrepreneurial journey and key challenges faced at every stage
of evolution.

22. Creating a market
When Malavika first started her venture, the Jharkhand government was already training rural
artisans. The state government had set up the Jharkhand Silk Textile and Handicraft Development
Corporation (Jharcraft) for providing training on a variety of handicrafts including painting and
embroidery on silk, jute, khadi and cotton (‘Jharcraft’, n.d.). However, this was not enough.
Malavika explained:
The trained artisans received little support once their training was over. What was most needed was
to develop a market, and keep out agents and middlemen who routinely exploited the artisans’ lack of
market access. (‘Malavika interview’, 2015)
Unlike rural home-based businesses in sectors such as retail or hospitality (Newbery and
Bosworth, 2010), Avika’s products were intended for well-off urban customers and had no demand
locally where they were produced. Rural enterprises are known to rely on both associative and
communal relationships, especially at the start-up stage (Newbery and Bosworth, 2014). Similarly,
to spread awareness about her venture, Malavika used her corporate contacts to set up exhibitions
at large Indian companies (Mankani, n.d.), such as Infosys, Wipro and TCS in metropolitan cities.
Malavika recalled:
This experience was invaluable to understand what kind of designs, materials, colours, sizes,
textures, fits, etc. were popular with customers. I had never sold anything in my life before. Seeing
customers appreciate our products gave me confidence and helped me realize the high prices that
customers were willing to pay for finely hand-produced artistic creations.
Soon, Malavika started supplying products to Mother Earth, a chain of clothing stores on a ‘sale-or-
return model’, wherein anything left unsold for a period of 3 months was returned by the store. This
sometimes left Malavika saddled with inventory. As a response to this situation, Malavika set up a
website ‘’ and listed the unsold inventory there. Later, the website became a regular channel to sell
handicraft products. Malavika also occasionally received orders from other Indian clothing retail
chains such as FabIndia, directly or through buying houses (refer Figure 1 for Avika’s business
model).
Figure 1. Avika’s business model. Source: Authors’ interviews with Malavika Sharma.

23. Illiteracy, extreme poverty and risk aversion
The rural artisans were mostly illiterate, extremely poor and most often belonged to lower castes.
Malavika recalled:
The ground reality was that most artisans trained under the government’s schemes were going back
to menial labour or doing other low-value-addition activities. The government’s model of only
providing training almost never worked. The women-artisans did not have the capital, business
acumen and risk appetite to become entrepreneurs.
Malavika aimed to fill these gaps. By purchasing raw material on behalf of artisans, Malavika
ensured that they did not lack working capital. By getting job orders from clothing retail chains,
Malavika minimized risks and provided the artisans with a market.
An evolving operational model
The venture’s business model evolved significantly over time (refer Figure 2). Initially, Malavika
wanted the women to work within her venture’s premises. This system was not preferred by the
women workers as they had other responsibilities at home such as cooking, looking after kids and
helping out on farms. Most women could only spare 3–4 h/day and that too at a different time on
each day. The embroidery work was treated as something that they would do side by side in
parallel with their other activities. In addition, the highly patriarchal rural society looked down upon
women venturing out of their homes for work.
Figure 2. Evolution of Avika’s operational model. Source: Authors’ interviews with Malavika Sharma.
To overcome these difficulties, Malavika altered the operational model and began to give the
women raw materials (comprising of silk cloth, threads, hand-embroidery instruments and design
sheets) and allowed them to do the embroidery at their own homes. However, initially, this model
also did not work very well. Deliveries were late and often the work was of poor quality or
damaged. In such situations, Malavika was unable to honour the time and quality commitments

24. made to her clients and ran the risks of losing large orders or not getting paid for work. Malavika
recalled:
I was stumped. Women did not want to work at our centre where we could control quality. The work
they did at home was casual and of poor quality. My reaction was to start cutting payments as a
punishment for late deliveries or poor quality work. To my surprise, this loss of wage had no real
impact on their behaviour.
My eureka moment came three years ago. I realized that rural women saw money differently than us
city folk. For them, only actual money in hand is money. Money notionally earned through a contract,
had no meaning in their lives. When they signed up for a piece of work, I assumed that they mentally
accounted for the money they were going to earn. However, they saw it differently. If they could not
do timely and good quality work, and I docked their payment, they saw nothing wrong with that and
accepted the lesser payment rather stoically and without much regret.
Based on this insight, Malavika changed the operational model once again. She stated,
I changed my policy. If an artisan did not deliver according to the commitment, I still paid her the
originally promised amount. But I stopped giving work to any such person for the next three months.
Suddenly, there was big improvement in discipline levels. I realized that more than the amount they
were making, these women valued consistency of income.
While the workforce kept growing, there was constant churn. Some of the trained women migrated
to cities for better earnings prospects. Skilled artisan girls got married and moved to another village
or stopped working for many months. Sometimes, there were exponential jumps in new recruits
from villages where the girls trained at our centre got married into – they added an entire batch
(30–80 women). Thus, the production capacity of the venture kept varying.
Self-help groups
Over time, the operational model evolved further. Malavika encouraged women to work in groups
in their own household clusters. She helped them organize into self-help groups (SHGs)
comprising of seven to eight women. Each group had one woman in charge who took work orders
from Malavika. The leader distributed work among the SHG members. To ensure discipline and
quality, Malavika devised a policy, whereby if any member of an SHG delayed their deliverable or
produced poor quality work, then the entire SHG was suspended for a month and was not offered
any raw materials to participate in the next monthly cycle. This meant a loss of income for all
women in the SHG.
What types of innovation are there?
The term innovation is very versatile and is frequently inflated. A clear definition of the term is important for a
clear, common understanding in companies. To this end, there are various types of innovation with regard to the
object of innovation and the degree of innovation. This knowledge of classification is necessary for innovation
management.

25. What is the purpose of types of innovation?
Why do we deal with types of innovation? From the point of view of innovation management, the types of
innovation and thus the classification of innovation have a strategic and process-related significance.
A clear definition of the desired innovation object and degree of innovation is important for the innovation
strategy. This determines where an organization wants to innovate.
The classification is also relevant for the innovation process, since the different types of innovation have
different requirements for the innovation process. A radical innovation requires a more comprehensive process
with different decision-making structures than a small incremental innovation.
Object of innovation - What is being innovated?
Innovation can happen anywhere, whether it is a profit-driven or non-profit organization. It can affect the
performance of the organization itself, i. e. the product or service, but also the structures of how the service is
provided. The first classification is thus the object of innovation.
Product innovation: Products concern both material products and intangible services such as services that meet
customer needs and are thus acquired by the customer. With product innovations, a company earns its money
and tries to differentiate itself from the competition.
Service innovation: service innovations are like product innovations when it comes to selling them directly to
the customer, e. g. insurance or management consultancy. Even if services are not actively sold, as in the case of
manufacturing companies, each company still provides services to its customers, for example in logistics,
complaints, sales advice, etc., even if they are not actively sold. This is also where innovation comes in when it
comes to differentiation and customer enthusiasm.
Business model innovation: The business model is the way a company functions and earns money. The
business model innovation encompasses innovations in strategy, marketing, supply chains, value creation,
pricing or cost structures.
Process and technology innovation: As the name implies, these are technological innovations, such as the
creation of products and services. In principle, they are also process innovations. These include, for example,
production processes or IT technologies for apps. Product innovations, quality improvements or cost savings
often go hand in hand with process and technology innovations.
Organizational innovation: Organizational innovations affect the process and organizational structure. These
can be organizational process innovations or management innovations, e. g. new tools for measuring customer
satisfaction or optimizing delivery processes to reduce costs.
Social innovation: Social innovations are innovations where the benefit lies with society and the purpose is not
primarily profit. Examples include innovation in education, poverty reduction, equal opportunities and health.
Environmental innovation: All innovations that contribute to improving the environment are environmental
innovations. This concerns for example environmentally friendly products, contributions to environmental
protection or the avoidance of emissions.
An innovation can affect several innovation subjects at the same time. Logically, there is no clear demarcation
here. For example, a product innovation can be a process and environmental innovation at the same time. Or a
business model innovation usually also brings with it a product and organizational innovation.

26. Degree of innovation - How new is the innovation?
How new an innovation is is often a subjective consideration. An innovation can therefore be called new
 for a company,
 for a market or industry, or
 for the whole world.
Another frequently used classification for innovation according to novelty is according to the extent of change:
 Radical innovationsare new products, services or processes and involve
significant change and innovation. Accordingly, the impact is also greater - for
example, new markets can be created as a result.
 Incremental innovationsare the optimization and further development of existing
products, services or processes. The purpose and benefits are optimization of
customer benefit, cost reduction, repositioning, adaptation for introduction into
new markets or adaptation to new circumstances such as new laws and
standards.
Accordingly, radical innovations are basic innovations and revolutions, while incremental innovations are
improvements, adaptations or follow-up innovations and thus evolutions.
Whether an innovation is radical or incremental is often very much in the eye of the beholder. Therefore, clear,
objective differentiation is often challenging.
This is shown by the example of the iPhone. Apple and Steve Jobs are polarizing in this respect, one of them
believes that his products were not innovative, while others see him as the ultimate innovator. Individually, most
the technologies were not new. But the iPhone, as a product that launched the new smartphone market, was a
revolutionary innovation. The business model with apps was also extremely innovative. Who would have
thought that mobile phone software would become a separate market?
It is important for companies and their innovation management that they define criteria for themselves,
according to which innovations are divided into incremental and radical innovations. Examples of criteria are
return on investment, amount of investment costs, payback period, patentability, etc. Thus, innovative ideas with
a high ROI, high investment costs, longer payback periods and which are patentable would be radical.
Another, currently very popular classification according to the novelty
 Sustaining innovations:Preserving or continuous innovation refers to the
improvement of existing, similar to incremental innovations. This type of
innovation focuses on current customers and their needs.
 Disruptive innovations:Disruptive stands for replacing and disruptive and
describes innovations that shape a new market. Disruptive innovations mostly
originate in the low-end segment, in less attractive segments. However, as the
maturity of technology and products increases, they are gradually attacking the
mass market and thus replacing existing services.

27. Other types of innovation
In addition to the subject of innovation and the degree of innovation, there are other classifications.
One of them is the trigger for innovation - what triggered the innovation? A distinction is made between market
pull and technology push.
 Market pull innovationsoriginate from the market and are initiated by a specific
customer request.
 Technology-push innovationsare the result of new technologies for which suitable
application possibilities are sought and implemented.
The literature on innovation types also contains a division into closed and open innovation, although this refers
more to innovation management than innovation itself.
Closed innovation involves only internal resources for generating ideas, developing and implementing
innovations. Open innovation also integrates external partners such as customers, research institutes or
suppliers into the innovation process.
Conclusion: What types of innovations are there?
The main classification is according to the object of innovation and the degree of innovation. There are blurring
boundaries in the classification of innovation types. Where exactly the boundaries between the individual types
of innovation in these categories lie must be determined by organizations themselves. This classification has a
strategic relevance for innovation management, namely to determine the focus in the innovation strategy. The
other purpose is to initiate the individual innovation projects into the innovation process. This is because a
small, incremental innovation in the product area requires different processing than a radical innovation in the
production process.
Types of Innovation
It is remarkable how many people are under the false assumption that companies are either innovative or not.
This is a very polarizing and simplistic perspective that does not take into account the different types of
innovations that companies can and do pursue.
For this post, let’s break down innovation into two dimensions: Technology and Market, which gives us the
following 4 types of innovation:

28. Incremental Innovation
Incremental Innovation is the most common form of innovation. It utilizes your existing technology and increases
value to the customer (features, design changes, etc.) within your existing market. Almost all companies engage
in incremental innovation in one form or another.
Examples include adding new features to existing products or services or even removing features (value through
simplification). Even small updates to user experience can add value, for example below is an older version of
Constant Contact’s email schedule page:

29. There is nothing majorly wrong with this page, however it is easy to see that the page title is “Schedule”, yet there
are no schedule settings anywhere to be seen. In fact, in this version, you have to click on the yellow schedule
button on the upper right-hand corner to actually pop up the schedule settings. In addition, there is a huge empty
space on the right side of the page that does not contribute much value to the user. Below is a more current
version of the same page:

30. This updated version replaces the “Schedule” title with the title of the email campaign. This makes it easier for
the user to see which campaign they are working on. Actual schedule settings have replaced the awfully huge
empty space on the right-hand side, which makes it possible for the big yellow “Schedule” button to actually
schedule. Also, larger sized form fields have been introduced to allow easy clicking on those elements. All
these changes, which may seem as just updates, are actually small incremental changes focused on adding
more value to an existing product. They will prove to be incrementally innovative if customers have a better
experience with the product and are able to schedule email campaigns much easier.
Disruptive Innovation
Disruptive innovation, also known as stealth innovation, involves applying new technology or processes to your
company’s current market. It is stealthy in nature since newer tech will often be inferior to existing market
technology. This newer technology is often more expensive, has fewer features, is harder to use, and is not as
aesthetically pleasing. It is only after a few iterations that the newer tech surpasses the old and disrupts all
existing companies. By then, it might be too late for the established companies to quickly compete with the
newer technology.
There are quite a few examples of disruptive innovation, one of the more prominent being Apple’s iPhone
disruption of the mobile phone market. Prior to the iPhone, most popular phones relied on buttons, keypads or
scroll wheels for user input. The iPhone was the result of a technological movement that was years in making,
mostly iterated by Palm Treo phones and personal digital assistants (PDAs). Frequently you will find that it is not
the first mover who ends up disrupting the existing market. In order to disrupt the mobile phone market, Apple
had to cobble together an amazing touch screen that had a simple to use interface, and provide users access to
a large assortment of built-in and third-party mobile applications.
Architectural Innovation
Architectural innovation is simply taking the lessons, skills and overall technology and applying them within a
different market. This innovation is amazing at increasing new customers as long as the new market is
receptive. Most of the time, the risk involved in architectural innovation is low due to the reliance and
reintroduction of proven technology. Though most of the time it requires tweaking to match the requirements of
the new market.
In 1966, NASA’s Ames Research Center attempted to improve the safety of aircraft cushions. They succeeded
by creating a new type of foam, which reacts to the pressure applied to it, yet magically forms back to its original
shape. Originally it was commercially marketed as medical equipment table pads and sports equipment, before
having larger success as use in mattresses. This “slow spring back foam” technology falls under architectural
innovation. It is commonly known as memory foam.
Radical innovation
Radical innovation is what we think of mostly when considering innovation. It gives birth to new industries (or
swallows existing ones) and involves creating revolutionary technology. The airplane, for example, was not the
first mode of transportation, but it is revolutionary as it allowed commercialized air travel to develop and prosper.
The four different types of innovation mentioned here – Incremental, Disruptive, Architectural and Radical – help
illustrate the various ways that companies can innovate. There are more ways to innovate than these four. The
important thing is to find the type(s) that suit your company and turn those into success.
15 Types of innovation
15 types of innovation (illustrated by car / mobility examples).
for inspiring your innnovation challenges.
Remarkable innovations combine different types !
1. Incremental innovation
Incremental innovation seeks to improve the systems that already exist, making them better, faster cheaper.

31. 2. Process innovation
Process innovation means the implementation of a new or significantly improved production or delivery method.
3. Red ocean innovation
Red Oceans refer to the known market space, i.e. all the industries in existence today. In red oceans, industry
boundaries are defined and accepted, and the competitive rules of the game are known. Companies try to outperform
their rivals to grab a greater share of existing demand usually through marginal changes in offering level and price. As
the market space gets crowded, prospects for profits and growth are reduced. Products become commodities, and
cutthroat competition turns the red ocean bloody. (source)

32. 4. Service innovation
Service Innovation can be defined as “a new or considerably changed service concept, client interaction channel,
service delivery system or technological concept that individually, but most likely in combination, leads to one or
more (re)new(ed) service functions that are new to the firm. (source)
5. Business model innovation
Business Model Innovation (BMI) refers to the creation, or reinvention, of a business itself. Whereas innovation is
more typically seen in the form of a new product or service offering, a business model innovation results in an entirely
different type of company that competes not only on the value proposition of its offerings, but aligns its profit
formula, resources and processes to enhance that value proposition, capture new market segments and alienate
competitors. (source)
6. Sustainable innovation
Eco-innovation is a term used to describe products and processes that contribute to sustainable development

33. 7. Frugal innovation
Frugal Innovation is about doing more with less. Entrepreneurs and innovators in emerging markets have to devise
low cost strategies to either tap or circumvent institutional complexities and resource limitations to innovate, develop
and deliver products and services to low income users with little purchasing power.(source)
Frugal engineering.
More examples Functionall Trend briefing
8. Blue ocean innovation
Blue Oceans represent the unknown market space, i.e. all the industries not in existence today. Blue oceans are
defined by untapped market space, demand creation, and the opportunity for highly profitable growth. In blue oceans,
competition is irrelevant because the rules of the game are not set. Blue oceans can be created by expanding existing
industry boundaries or by reconstructing industry boundaries. (source)

34. 9. Radical innovation
Radical innovations (sometime referred to as breakthrough, discontinuous or disruptive innovations) provide
something new to the world that we live in by uprooting industry conventions and by significantly changing customer
expectations in a positive way. Ultimately, they often end up replacing existing methods / technologies. (source)
10. Open source innovation / Crowdsourcing
In production and development, open source is a philosophy or pragmatic methodology that promotes free
redistribution and access to an end product’s design and implementation details
c,mm,n
Volkswagen crowdsources its way to a Hover Car

35. 11. Experience innovation
Companies that try to create holistic experiences by emotionally engaging their consumers.
12. (Im)possible innovation
13. Disruptive innovation
A disruptive innovation is an innovation that helps create a new market and value network, and eventually goes on to
disrupt an existing market and value network (over a few years or decades), displacing an earlier technology.
14. User led innovations
The user is king. It’s a phrase that’s repeated over and over again as a mantra: Companies must become user-centric.
But there’s a problem: It doesn’t work. Here’s the truth: Great brands lead users, not the other way around. (source)

36. 15. Supply chain innovation
Supply chain innovation is about applying best practices and technological innovations to your own supply chain in
order to reduce such cycle and wait times and other waste (to use a Lean term) in your in-house processes. (source)
Generating and screening ideas for
new products
Successful new product development (NPD) starts with identifying good product ideas and using
reliable criteria to decide which ideas to pursue.
You should take the following steps before you allocate funds to new product development.
Idea generation
Write a customer needs list based on the information you gather from the sources identified below.
You should try to identify existing weaknesses in your products, gaps in your product range and areas
for product improvement.
Brainstorm product issues
Work with your existing team members to brainstorm product issues. Your sales and service staff
speak to your customers daily, hearing feedback about your products and the customers' needs.

37. Capture the feedback, product observations and ideas from your team. Make sure you recognise their
ideas and promote a shared culture of innovation.
Use your research and development (R&D) processes
Use your business's existing R&D processes. Identify modifications you could make to existing
products, or adaptations for new products, consistent with feedback from your market and customers.
Review your quality assurance (QA) processes
Note any issues in your products and identify potential ideas for addressing gaps in quality.
Review your customer complaint records
Identify common weaknesses in your existing product range, and look for areas where improvement
is most needed. Learn about managing customer complaints.
Review your research
Review your customer research and market research, and plan further market and customer surveys
if you identify research gaps. What are your customers telling you they're looking for? What do they
find frustrating or limiting about your products? How do they use your products most?
Talk to your suppliers and other business partners
Talk to manufacturers, retailers and sales reps to capture their knowledge of your products and
thoughts for improving them.
Research and understand your competition
Try to understand your competition. Review your competitors' product range and consider how the
market is responding to them. Do any of their products seem to be meeting needs that yours aren't?
Study catalogues and product information
Make sure you have a comprehensive understanding of existing products available in your market.
Idea screening
With your list of potential new product ideas, you now need to decide which ideas to pursue and
which to discard. Consider your competition, your existing products, their shortcomings, and the
needs of your market. Draw on the customer needs list you have developed, and the areas for
product improvement you have identified.
Develop a set of criteria to evaluate your ideas against. Your criteria might include:
 most prominently identified customer needs
 product improvements most needed
 the benefits to your target market
 the technical feasibility of the idea
 the level and scope of research and development required

38.  the profitability of the idea. What is its potential appeal to the market? How would you price it?
What are the costs in bringing it to market - overall and per unit?
 where the product fits in the market. Is there a gap? How close is it to competitor products?
 the resources it will require in development
 the marketing potential of the idea
 the fit with your business profile and business objectives.
SWOT analysis
A SWOT analysis can help you to identify the strengths and weaknesses of each idea.
Innovation support
Your innovative approach and your steps to foster innovation in your team will help you realise your
new product goals. Find out about innovation advice, grants and support.
Difference Between a Business Plan
and a Feasibility Study
Many people don’t know that there is a difference between a business plan and a feasibility
study.
Many a time when people contacting me, they ask for a feasibility study instead of asking for
a business plan. That is why I always interview them to know exactly what they want to use
it for and in the course interacting with them, I get to understand that what they need is
actually a business plan and not a feasibility study. In this article, I will explain more for your
understanding.
Table of Content:
1. What is a Business Plan and a Feasibility Study?
2. Main Purpose of a Business Plan and a Feasibility Study
3. Content
4. Outline of a Business Plan and a Feasibility Study
5. Challenges of a Business Plan and a Feasibility Study
So let us start with the first one which will give us a brief overview of what a business plan
and a feasibility study is all about
1. What is a Business Plan and a Feasibility Study?
Business plans and feasibility studies are vital business tools for analysis and also for making
decisions in a business. But a feasibility study is not the same thing as a business plan
because a feasibility study gives a conclusion or recommendation would be completed prior to
developing the business plan.
A Feasibility study is done to determine whether a proposed business has a high enough
probability of success that it should be undertaken. A feasibility study is carried out first in
order to know if the business will be viable before venturing into it. Before a company can

39. invest in a business or launch a new product, a feasibility study is done to determine if there
will be a return on investment.
According to Rochester.edu, a feasibility study can be defined as “a controlled process for
identifying problems and opportunities, determining objectives, describing situations, defining
successful outcomes, and assessing the range of costs and benefits associated with several
alternatives for solving a problem.”
There can also be used to make decisions about whether to launch a new product in an
existing company or enter a new market. Feasibility studies are sometimes termed
cost/benefit analyses because the projected costs of the project are compared to the
expected benefits to yield a conclusion.
Business plans are blueprints for implementing actions that have already been deemed
feasible by the company’s management. So a business plan is like a roadmap for your
business that outlines goals and details how you plan to achieve those goals.
Business plans map out the direction a company intends to take to reach its revenue and
profit objectives in the future. They are a compilation of numerous decisions made by the
management team about how the company should be run. A business plan is done after a
feasibility study has been carried out. If the recommendation of the feasibility study says
negative, then there will be no need to venture into the business. Then if the feasibility study
says the business will be feasible, then a business plan is developed which will then map out
plans and strategies to adopt in order to achieve business goals including revenue
generation, market penetration, customer acquisition, marketing and sales strategies among
others.
A business plan can be done for internal use or external use. The internal use of a business
plan is for the management and staff of the company while the external is for shareholders,
investors, for bank loan and customers.
2. Main Purpose of a Business Plan and a Feasibility
Study
In short, a feasibility study gives a conclusion or recommendations while a business plan
gives the roadmap.
The feasibility study helps determine whether an idea or business is a viable option.
Therefore, a feasibility study is done first before investing a dime in the business. Before
considering approaching investors, you must have done your study to know that the business
is feasible before taking any decision. That is why a feasibility study gives a conclusion or
recommendations.
A business plan will map out the roadmap/strategies to achieve your business goal because a
business plan assumes a business is going to viable and presents the steps necessary to
achieve success. If you are looking forward to approaching an investor or trying to get a bank
loan, what you need is the business plan. Some investors might request for a feasibility study
first before the business plan
3. Outline of a Business Plan and a Feasibility Study
Below is the outline of a business plan:

40. Executive Summary
Business/Company Overview
Products/Services
Market/Industry Analysis
Strategy
Operation Plan
Management/Personal plan
Sales Forcast
Financial Plan
Appendices and Exhibits
A good outline for a feasibility study includes:
Introduction
Product or Service
Technology
Market Environment
Competition
Industry
Business Model
Market and Sales Strategy
Production Operations Requirements
Management and Personnel Requirements
Regulations and Environmental Issues
Critical Risk Factors
Financial Predictions Including: Balance Sheet, Income Statement, Cash Flow
Statement, Break Even Analysis, and Capital Requirements
Conclusion
4. Challenges of a Business Plan and a Feasibility Study
Looking at both the business plan and feasibility study, you will discover that both attempt to
predict future outcomes using assumptions about what is likely to happen in the business and
the business environment which include government policies, the market, competition, risk
among others, any poorly done feasibility study can lead to a costly mistake. If a business is
not viable and the recommendation says the business will be viable, the end result will not be
palatable. This will affect the business plan and the operation of the business adversely.
A poorly done business plan – poor projections, strategies, analysis, business model,
environment factors among others can easily be adjusted in the course of running the
business but the same cannot be said of a feasibility study because in a feasibility study, an
incorrect conclusion can be costly — it could mean launching a venture that has very little
chance of surviving or approving a project that wastes the company’s human and financial
resources.

41. technical marketing
The term “technical marketing” has two meanings, though they are often related. Classically, technical marketing
is any method of marketing focused on the specifications and key features of a product, designed to appeal to
customers with a base technological understanding of the product. However, technical marketing has also grown
to encompass any use of modern technology as a marketing tool.
Adobe TV is a great example of technical marketing in both senses of the term. It is a tool Adobe Systems uses
to communicate the features and appeal of complex software to customers who already use such software on a
regular basis. The tutorials on Adobe TV assume a certain degree of comfort with computer technology and even
the specific program being featured. Rather than simply raising awareness about a program and making it seem
attractive to those who know nothing about it, Adobe TV increases the appeal of a program by teaching users
how to implement its more advanced features.
Adobe TV also uses modern technology such as embedded Internet video as a marketing tool. Again, this is
intended to reach customers who already have a certain degree of comfort with the technology Adobe is
marketing. Instead of using media like books, home video, or television to deliver tutorials, Adobe TV's video
tutorials reach customers who are certain to be literate about Internet technology.
Any company that has a technically complex product or whose customers tend to be technically educated people
can benefit from technical marketing.
If, for instance, a company wants to market a line of advanced factory equipment, its customers are likely to
already know about the technical aspects of factory equipment in general. The company should create marketing
materials that outline the technical specifications of the equipment, such as how fast the equipment works, what
temperatures it can safely handle, and how much electricity it consumes every hour. These aspects are more
important to the company's customers than simple branding.
A company doesn't necessarily need to appeal exclusively to highly informed customers to benefit from technical
marketing. Car companies often advertise vehicle specifications in mass marketing materials like television
commercials, though they can't be certain their audience truly understands what the specs mean. This includes
simple concepts like how many miles per gallon of gas the vehicle gets, the horsepower of its engine, and the
particular kind of brakes it uses. These specifications might sound impressive even to an audience with little
knowledge of car engineering.
Before a technical marketing campaign begins, everyone on a marketing team must work closely with the
product's developers to acquire a thorough understanding of a product or service.
For example, if an electronics company wanted to begin marketing a new, high-end digital video camera intended
for filmmaking, the marketing team should spend time with the people at the company who designed, built, and
tested the camera to discover what the camera can do and what its technical specifications mean. This allows
marketing professionals to create effective advertising materials for people like movie directors,
cinematographers, and videographers who already understand digital photography.
While the marketing team is learning about the product, they should also conduct market research to determine
who is most likely to be interested in the product, and what is most important about it to them. The team at the
electronics company might read consumer data and conduct surveys to find out what kinds of people are likely to
buy the new camera, and which specifications they value the most in cameras.
Using market research data and knowledge they learn from the developers, a marketing team creates advertising
materials for their product and places them in strategic media channels. The team at the electronics company
could craft an advertisement outlining the camera's specifications to be placed in a film industry magazine, as
well as create the camera's product page on the company website. Informational materials are highly effective in
technical marketing, so the electronics company should also create valuable content like blog posts and videos
related to the camera that will link to the product web page.

42. Throughout the advertising campaign, the marketing team should have a method to collect customer feedback
about the product. Adjustments to the campaign should be made using the feedback collected. (See also B2C
Marketing)
Technical marketing is an interdisciplinary field. It relies on a team of people who have a diverse set of skills,
ranging from great research, to creative design and excellent communication. The following are just a few
positions that are highly valuable on a technical marketing project.
In the preliminary stages of a technical marketing campaign, the team will rely on a researcher to gather and
analyze information about the product's related market and consumer behavior. Market researchers need to have
a meticulous attention to detail, the ability to speak to a wide variety of people during surveys, and strong
communication skills to convey what they have learned from their research.
Education/Experience
Market researchers should have a bachelor's degree in marketing, business, psychology, or sociology. Previous
experience in a data-focused field like analysis or database management is very helpful.
In today's technology-driven business world, consumers will almost certainly seek out a company's website to
learn more about a product. This is especially true for consumers who are searching for technical specifications.
A web designer is in charge of coding and creating the visual layout of a website. This requires high computer
literacy and experience with many kinds of business software, including programs for coding, graphic design, and
image editing.
Education/Experience
Web designers should have a Bachelor of Science degree in marketing, web design, or computer science. It is
very important for a designer to include a portfolio of original website designs with any resume to demonstrate
ability and creativity.
Because so many products advertised with technical marketing are complex and require some training to use,
instructional materials can be very effective marketing tools. Instructional designers create everything from
ebooks, to video tutorials and other educational materials that teach customers about a product and how to use
it. This requires strong written and verbal communication skills, as well as comfort with multimedia technology like
video and sound editing, web publishing, and word processing software.
Education/Experience
Instructional designers should have a bachelor's degree in marketing, business, education, English, or
communications. It can be useful to have previous experience in a teaching position, in a writing-focused
position, or in a media-focused role.
Those who are interested in learning the professional skills necessary to participate in technical marketing
campaigns and other advanced strategies should consider applying to a marketing education program. A
marketing program provides an extensive examination of the business and philosophy of modern marketing,
while giving students hands-on experiences that are invaluable in the pursuit of a marketing career.
Early coursework in marketing concentrates on establishing a firm foundation of marketing concepts and
practices. This includes classes that teach vital team-building and communication skills that will be important for
working effectively in any marketing department. These preliminary classes will also discuss marketing campaign
finance for realistic budgeting concepts, as well as the basics of branding and advertising content.
For students who are most interested in technical marketing, the technology-focused courses in a marketing
program will be the most important. These classes will familiarize students with business tools like widely used
office suite software for word processing and database management, and also more complex programs for web
design and data modeling. Marketing technology classes not only teach students how to use existing software,
they also teach tomorrow's professionals how to learn new software quickly and effectively.
A marketing education culminates in advanced work with business simulations and in-depth case studies of
marketing campaigns from the real world. Students will be expected to create their own campaigns, applying all
they have learned to demonstrate a true understanding of the skills they will have to implement later in the
workplace. This fast-paced, interactive approach to business education prepares aspiring marketing
professionals to be valuable assets on any marketing team, whether it is part of a large corporation, a small start-
up, or anything in between.
Small Scale Industries of india
Small scale industries (SSI) are those industries in which manufacturing,
providing services, productions are done on small scale or micro scale. For

43. example, these are the ideas of Small scale industries: Napkins, tissues,
chocolates, toothpick, water bottles, small toys, papers, pens. Small scale
industries play an important role in social and economic development of India.
These industries do a one-time investment in machinery, plants, and industries
which could be on an ownership basis, hire purchase or lease basis. But it does not
exceed Rs. 1 Crore. Let us discuss in detail about it.
Small Scale Industries
Essentially small scale industries comprise of small enterprises who manufacture
goods or services with the help of relatively smaller machines and a few workers
and employees. Basically, the enterprise must fall under the guidelines set by the
Government of India. At the time being such limits are as follows,
 For Manufacturing Units for Goods: Investment in plant and machinery must be
between 25 lakhs and five crores.
 For Service Providers: Investment in machinery must be between 10 lakhs and two
crores.
In developing countries like India, these small scale industries are the lifeline of
the economy. These are generally labor-intensive industries, so they create much
employment. They also help with per capita income and resource utilization in the
economy. They are a very important sector of the economy from a financial and
social point of view.
Examples and Ideas of Small Scale Industries
 Bakeries