KUMI UNIVERSITY

FACULTY OF SOCIAL SCIENCES & MANAGEMENT STUDIES

Course Name : ENTREPRENEURSHIP SKILLS DEVELOPMENT

Course Level : Year one Semester One
Credit Unit : 3 CU
Contact Hours : 45 Hours
Course Code :
Course Description
The course is intended to enable students develop a mentality of thinking innovatively and create
jobs other than seeking jobs. Its content will therefore include; Theories of Entrepreneurial
Culture, Entrepreneurial Support Systems and the State and Entrepreneurship.
Course Objectives
This course is intended to:
✓ Equip students with skills to start and own a business
✓ Instill in the students’ entrepreneurial attitudes to counteract tough business challenges
✓ Instill in the students, the culture of job-creators rather than job-seekers
Learning Outcomes
By the end of the course, the students should be able;
✓ To design and interpret a business plan.
✓ To explain the role of entrepreneurs in economic development
✓ To attain knowledge and skills to prepare, manage and complete a business plan
Course Content
1. Introduction 4 Hrs
✓ The entrepreneurs and entrepreneurship
✓ Entrepreneurial Characteristics
✓ Diversity in Entrepreneurship
✓ Cost of starting a business
✓ Causes of business failure

2. Entrepreneurship Development in Uganda 4 Hrs

✓ Importance of entrepreneurship to the community
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 ✓ Conditions for entrepreneurship development
✓ Status of Entrepreneurship development in Uganda
3. New Ventures Ideas 4 Hrs
✓ Foundation of ideas and the role ideas play in entrepreneurship
✓ Misconceptions about ideas
✓ Types of new venture ideas
4. Creativity 8 Hrs
✓ Creative thinking
✓ Creativity and innovation
✓ The creative process
✓ Innovation and entrepreneurship
✓ Types of innovation
✓ The innovation process
5. Entrepreneurship within the Organization 4 Hrs
✓ Aspects that foster entrepreneurship in an organization
✓ Steps in establishing entrepreneurship
✓ Classification of corporate Entrepreneurship
6. Forms of Business in Uganda 4 Hrs
✓ Partnerships
✓ Sole Proprietors
✓ Companies
7. Feasibility Study 4 Hrs
✓ The importance of research
✓ Economic feasibility, Marketing feasibility, Technical feasibility, Financial feasibility,
Operational feasibility, Schedule feasibility
8. Business Plan Development 13 Hrs
✓ Legal considerations
✓ Technical requirements – premises, production, Quality assurance,
✓ Defining your customer
✓ Understanding your competitors
✓ Sales and marketing strategies
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 ✓ Financial & Cash flow requirements
✓ Ethics in Entrepreneurship
Mode of Delivery
Lectures, presentations, Group discussions/ self-study, Assignments, cluster meetings and online
studies
Assessment Method
The assessment method is structured to include coursework and final examination. Coursework
consists of assignments, presentations and tests. Each course in the programme shall be assessed
on the basis of course work/tests and final examination represented as follows:
Course work assessment/tests 30%
Final Examination 70%
100%
The minimum cumulative mark required to pass is 50%, is required to pass this unit. This
includes course work and final examination. Each course in the programme is allowed a
maximum of three hours for final examination.

Reading Materials
Howells, P. & Bain, K. (1998): The Economics of Money and banking and Finance (A European
Text)
Robert. D .Hisrich, Michael.P. Peters & Dean .A. Sheperd (2008): EntreprenurshipAfrican
Edition.
Thomas W.Zimmerer&Norman .M. Searborough (2008): Essentials of Entreprenurship and
small business Management. Pearsons International Edition
Blackwell, E. (2002): How to prepare a business plan, Kogan Page; London.
Martin, W. (1998): Creating and Developing a Consultancy Practice. Dublin: Oak Tree Press.
Gupta, C. B. and Khanka, S. S. (2000): Entrepreneurship and small business management. New
Delhi: Sultan Chand & Sons Educational Publishers.

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 ENTREPRENEURSHIP SKILLS DEVELOPMENT

INTRODUCTION
The term „Entrepreneur‟ is defined in different ways. However, no consensus has been arrived at
a universally accepted definition of entrepreneur.
An entrepreneur is someone who exercises initiative by organizing a venture to take benefit of
an opportunity and, as the decision maker, decides what, how, and how much of a good or
service will be produced.
An entrepreneur takes risk capital as a risk taker, and monitors and controls the business
activities. The entrepreneur is usually a sole proprietor, a partner, or the one who owns the
majority of shares in an incorporated venture.
Definitions of Entrepreneur
The term „Entrepreneur‟ is defined in different ways. However, no consensus has been arrived at
a universally accepted definition of entrepreneur.
(i) Cantillon:
According to him, an entrepreneur is the agent who buys means of production at certain prices in
order to combine them into a product that he going to sell at prices that are uncertain now at
which he commits himself to his costs.
In this definition, Cantillon emphasized the function of risk taking and uncertainty bearing. The
entrepreneur is designated as a dealer who purchases the means of production for combining
them into marketable products.
(ii) J.B. Say:
“The entrepreneur is the economic agent who unites all means of production, the labour force of
the one and the capital or the land of the others and who finds in the value of products his results
from their employment reconstitution of the entire capital that he utilizes and the value of the
wages, the interest and the rent which he pays as well as profits belonging to himself.” Thus,
above definition provides than an entrepreneur is an important agent of production who gets
together other factors of production. He further states that the entrepreneur shifts economic
resources out of an area of lower productivity into an area of higher productivity and greater
yield.
(iii) The New Encyclopedia Britannica:

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It treats an entrepreneur as an individual who bears the risk of operating a business in the face of
uncertainty about the future conditions. This definition deals with uncertain future, that causes
risk in the operation of a business, and entrepreneur is required to bear the risk.
(iv) Joseph A. Schumpeter 1934:
He defined “entrepreneur as an individual who carries out new combines of means of production
by which there occurs disequilibrium.”
He further stated that the key individuals in development are the entrepreneurs who are
especially motivated and talented class of people. They foresee the potentially profitable
opportunity and try to exploit it. According to him, entrepreneur is an innovator and innovator is
one who introduces new combinations.

(V) Peter F. Drucker (1970), states that an entrepreneur is the one who always searches for
changes, responds to it and exploits it as an opportunity. He further states that innovation is the
specific tool of entrepreneur, the means by which he exploits change as an opportunity for a
different business or services.

What is entrepreneurship?
Entrepreneurship is the act of starting a business in the hope of earning a profit. However, our
modern perception of entrepreneurship has evolved into recognizing its ability to solve largescale
problems and influence social change. Entrepreneurs may also become thought leaders in their
fields, although this isn‟t necessarily a distinguishing factor of someone in this role, but it can be
a natural outcome.
Entrepreneurship is the ability and readiness to develop, organize and run a business enterprise,
along with any of its uncertainties in order to make a profit. The most prominent example of
entrepreneurship is the starting of new businesses.
In economics, entrepreneurship connected with land, labour, natural resources and capital can
generate a profit. The entrepreneurial vision is defined by discovery and risk-taking and is an
indispensable part of a nation‟s capacity to succeed in an ever-changing and more competitive
global marketplace.

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It can be classified into small or home business to multinational companies. In economics, the
profits that an entrepreneur makes are with a combination of land, natural resources, labour and
capital.
Concisely, anyone who has the will and determination to start a new company and deals with all
the risks that go with it can become an Entrepreneur.

Types of Entrepreneurship
It is classified into the following types:
a) Small Business Entrepreneurship-
These businesses are a hairdresser, grocery store, travel agent, consultant, carpenter,
plumber, electrician, etc. These people run or own their own business and hire family
members or local employee. For them, the profit would be able to feed their family and
not making 100 million business or taking over an industry. They fund their business by
taking small business loans or loans from friends and family.
b) Scalable Startup Entrepreneurship-
This start-up entrepreneur starts a business knowing that their vision can change the
world. They attract investors who think and encourage people who think out of the box.
The research focuses on a scalable business and experimental models, so, they hire the
best and the brightest employees. They require more venture capital to fuel and back their
project or business.
c) Large Company Entrepreneurship-
These huge companies have defined life cycle. Most of these companies grow and sustain
by offering new and innovative products that revolve around their main products. The
change in technology, customer preferences, new competition, etc., builds pressure for
large companies to create an innovative product and sell it to the new set of customers in
the new market. To cope with the rapid technological changes, the existing organizations
either buy innovation enterprises or attempt to construct the product internally.
d) Social Entrepreneurship-
This type of entrepreneurship focuses on producing product and services that resolve
social needs and problems. Their only motto and goal is to work for society and not make
any profits.

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Characteristics of Entrepreneurship:
Not all entrepreneurs are successful; there are definite characteristics that make entrepreneurship
successful. A few of them are mentioned below:
1) Ability to take a risk- Starting any new venture involves a considerable amount of
failure risk. Therefore, an entrepreneur needs to be courageous and able to evaluate and
take risks, which is an essential part of being an entrepreneur.
2) Innovation- It should be highly innovative to generate new ideas, start a company and
earn profits out of it. Change can be the launching of a new product that is new to the
market or a process that does the same thing but in a more efficient and economical way.
3) Visionary and Leadership quality- To be successful, the entrepreneur should have a
clear vision of his new venture. However, to turn the idea into reality, a lot of resources
and employees are required. Here, leadership quality is paramount because leaders impart
and guide their employees towards the right path of success.
4) Open-Minded- In a business, every circumstance can be an opportunity and used for the
benefit of a company. For example, Paytm recognized the gravity of demonetization and
acknowledged the need for online transactions would be more, so it utilized the situation
and expanded massively during this time.
5) Flexible- An entrepreneur should be flexible and open to change according to the
situation. To be on the top, a businessperson should be equipped to embrace change in a
product and service, as and when needed.
6) Know your Product-A company owner should know the product offerings and be aware
of the latest trend in the market. It is essential to know if the available product or service
meets the demands of the current market, or whether it is time to tweak it a little.
a. Being able to be accountable and then alter as needed is a vital part of
entrepreneurship.

Importance of Entrepreneurship:
1) Creation of Employment- Entrepreneurship generates employment. It provides an entry-
level job, required for gaining experience and training for unskilled workers.
2) Innovation- It is the hub of innovation that provides new product ventures, market,
technology and quality of goods, etc., and increases the standard of living of people.

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 3) Impact on Society and Community Development- A society becomes greater if the
employment base is large and diversified. It brings about changes in society and promotes
facilities like higher expenditure on education, better sanitation, fewer slums, a higher
level of homeownership. Therefore, entrepreneurship assists the organization towards a
more stable and high quality of community life.
4) Increase Standard of Living- Entrepreneurship helps to improve the standard of living
of a person by increasing the income. The standard of living means, increase in the
consumption of various goods and services by a household for a particular period.
5) Supports research and development- New products and services need to be researched
and tested before launching in the market. Therefore, an entrepreneur also dispenses
finance for research and development with research institutions and universities. This
promotes research, general construction, and development in the economy.

Four (4) key concepts of entrepreneurship:

1. Innovation
2. Risk taking
3. Vision
4. Organization

Characteristics of entrepreneurs
Some of the most important entrepreneurial characteristics are:
1. Professionalism
2. Creative
3. Planning
4. Knowledge
5. Social skills
6. Open mindset
7. Empathy
8. Decision making
9. Effective management
10. Risk taking
11. Leadership
12. Multidimensional
13. Risk taking ability
14. Persisting nature
15. Innovative
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 16. Leading from the front
17. Ethical in nature

Diversity in business
Ideally, a well-structured team will consist of people from various backgrounds in the following
categories:
1. Race and culture
Having a racially diverse team with members from a variety of cultural backgrounds obviously
gives your business depth. When everyone is represented, there is more available information,
which in turn brings about inclusion and understanding. Having team members representing
populations from different cultures creates awareness of norms and taboos, which eventually
builds trust. Furthermore, this "trust relationship" dramatically benefits a company by naturally
including all groups in their target audience.
2. Experience
Every business needs team members who come with different personal and professional
experiences. With this kind of diversity, every situation and every problem can be addressed,
maybe even in various ways. When one avenue does not work, always someone else can offer
prior experiences with possible solutions.
3. Industry skills
Diversity in industry skills is a fundamental element all businesses practice. Companies post
specific jobs that require unique skills; this is nothing new. However, every astute leader knows
their employees' "specialty skills." These are not the heavy-hitting duties in the job posting, but
the more finite ones that keep functionality and productivity high. Whether it knows all the ins
and outs of fixing office technology or having deadeye proofreading skills, a great leader knows
which employee possesses what skills and utilizes them regularly.
4. Education and training
Not every stellar employee will have multiple college degrees. The best leaders know their
company needs diversity of people who possess all types of education and training, not just
traditional college. Being open-minded and looking for trainable people opens numerous
possibilities of finding the perfect person for your team. Great bosses see beyond the packaging
and take chances on people, even if they do not have as much education and training as other
candidates.

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5. Personality types: extroverts and introverts
An excellent team will have people from diverse personality types. For example, a productive
business has both extroverts and introverts working together, each feeding from the skills of the
other. While extroverts might get most of the attention and run the show, they do not have all the
answers. Influential leaders are wise enough to value the gifts introverts bring to their company.
Introverts are generally meticulous in gathering and processing information. Therefore, they are
great decision-makers. Quite often, introverts learn quickly through observation and serve as a
reliable team member who leads by example. Most extroverts have come to rely on their
introverted colleagues to be the voice of reason, a deciding factor and a redirector when the focus
is lost.
The advantages of employing a diverse team are numerous. Having unique team members means
having a company that can relate to anyone and formulate well-rounded solutions to global
issues. A diverse group can also identify the specific needs of people from various backgrounds
and serve its customers in a more caring and personal way. Any way you look at it, this is good
business.
Moreover, coming off a year when learning to pivot was essential; it is fair to say that businesses
with diverse teams weathered the pandemic storm much better than their counterparts.
Diversity in industry means employing people with varied backgrounds, skills, education and
personality types. With vast diversity in the business, no problem will be too weighty, and your
business will thrive.

Functions of an entrepreneur
The entrepreneur will have to perform various types of functions in the market and by doing so;
the entrepreneur will be able to build a successful business and can successfully lead the
company
1) Planning
The first function that an entrepreneur will have to perform is planning. Before
implementing an idea in the market, the entrepreneur must plan about different aspects.
As an entrepreneur, the individual will have to plan about the available resources in the
market and the arrangement of these resources. The entrepreneur before the establishment
of a business will plan every major and minor requirement of the business. When an

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 entrepreneur establishes a business, he or she must plan for the sources of finance. There
are multiple sources of finance available in the market, but the entrepreneur must plan
according to the requirement of the financial needs and the nature of the business.
2) Selection of location
When undergoing an expansion of the business or acquisition activities, an entrepreneur
has to make requirements for selecting a location. The location is approved after
considering various requirements. It is selected based on its reach towards the market.
The plant location must be located near the market so that the acquisition of raw
materials and other requirements such as labor and professional help can be easily
accessed. The company can also easily arrange for essentials from the market. When a
company is established far from the local market, the arrangement of unskilled labor
becomes very difficult. The entrepreneur must select a place that is feasible for everyone
and satisfies the government norms.
3) Arrangement of land
When an entrepreneur is evaluating the location, he also has to evaluate the land. The
land must be legal, that is, no government legal allegation should be there on the land.
The land should not be too costly and the entrepreneur must evaluate the type of land
needed. The entrepreneur must evaluate the land-based on government regulations.
4) Arrangement of capital
The entrepreneur is also responsible for arranging different types of capital for the
business. The requirement of the capital for the business will change according to the
business activities. Sometimes the entrepreneur will require a huge amount of finance for
business acquisition or merger. The sources of finance depend on the nature and type of
the business activities and entrepreneurs must select a source of finance after evaluating
various benefits and disadvantages.
5) Arrangement of labor
A business will require various types of laborers. The entrepreneur will be responsible for
arranging different types of labor in the business. When a business is dealing in the
manufacturing activity, it will require a large number of unskilled local laborers. The
entrepreneur will have to gain several unskilled laborers in the production activity. When

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 a company is dealing with a highly technological-based business, it will have to arrange
for skilled labor and professional technicians.
6) Arrangement of raw material
An entrepreneur has the responsibility of arranging the raw materials for the company.
The arrangement of raw materials will include various aspects. The entrepreneur will
have to undergo

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 a research activity for evaluating an effective and cost-efficient supplier for the company.
The entrepreneurs cannot arrange for raw materials based on the needs of the company.
This is because the entrepreneur will have to first evaluate the different types of suppliers
available in the market and then shortlist the supplier that is providing the best quality of
raw material at an effective cost. The cost and the quality of the raw materials matter to
the company the most because if the supplier supplies low-quality raw material, the
finished product will also be of low quality. The entrepreneurs will have to make
necessary arrangements for the company accordingly.
7) Arrangement of technology
Every day new technology is launched in the market that focuses on evaluating the
technological changes in the market. The entrepreneur cannot always rely on the same
type of technology in production. The entrepreneur should improve its technological
background every year. The entrepreneur will have to undergo some research and
analysis activity for evaluating the best technology for the business. He or she will have
to make necessary arrangements for evaluating the technological needs in the market.
The arrangement of technology is necessary for an entrepreneur because the competition
keeps increasing in the market every day and to stay in the market and to give tough
competition to its competitor's technological enhancement is very necessary for the
business. The entrepreneur cannot work on the same technology and the up- gradation of
the technology should be done every year or at least the technology should be renewed.
8) Coordination with factors of production
An entrepreneur should maintain coordination with the factors of production. The factors
of production will include land, labor, capital, and the entrepreneur. The entrepreneur
should maintain a balance and coordination between land, labor, and capital. The
entrepreneur should also arrange for good and feasible sources for the company and as
well, as arrange for skilled and unskilled labor. The entrepreneur is also responsible for
the arrangement of various sources of finance. The sources of finance are eliminated and
selected based on the requirement of the company and the nature and type of the
business. It is not always necessary that the company should only arrange funds through a

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BSEE ONE SEM ONE @2023.
 single source of finance. The company should ensure that the entrepreneur is maintaining
a balance between different sources of finance and is preparing a mixed portfolio.
9) Division of labor
The major responsibility and function of an entrepreneur are to delegate the work of the
laborers in the business. Division of labor includes the assignment of past work of the
laborers in the company. It is the responsibility of an entrepreneur because, if an
entrepreneur does not delegate the responsibilities according to the experience and
knowledge, then the laborers will not perform their best. It is also necessary to delegate
the work so that the laborers cannot blame others in the team for not accomplishing a
task. If the division of work is divided equally, the laborers will be liable to complete the
work and will not resist doing a part of the work.
10) Quality check of the product
When an entrepreneur is engaged in the production and manufacturing business, he will
have to ensure that the finished product of the company is of the best quality.
11) Increase the sales of the company
The entrepreneur is not only responsible for producing the product in the market but is
also responsible for effective selling. The entrepreneur must hire sales executives for the
business so that they can increase the sales of the company. Entrepreneurs must ensure
that the company is engaged in increasing its sales every year, the company should also
hire salespersons that can engage in selling activities.
12) Advertisement
The entrepreneur is also responsible for engaging in effective advertising strategies. If a
company is operating in different states and is a multinational company, the
advertisement plays an important role in the company. For creating awareness about the
product in the market and delivering the information about the product in the market,
advertisement plays an important role. Different advertising strategies such as digital
advertisement, advertisement on hoardings, newspaper advertisement play an important
role in creating brand awareness and awareness regarding the new product in the market.

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13) Creation and search for the market
14) Whenever an entrepreneur takes the responsibility of generating revenue for the company
and increasing its market share, he also has the responsibility of searching for a better
market. The company or the entrepreneurs cannot launch the product in the market
without a search for its customers. The major responsibility of an entrepreneur is to
search for the customers and the customer segment that will purchase the products.
15) Maintaining relation with external parties
The entrepreneur is also responsible for maintaining a good relationship with external
participants of the external parties that include the government, suppliers, and other
related parties. If a company or an entrepreneur does not have a good relationship with
these external parties, the functioning of the business will become difficult in the market.
The entrepreneur is responsible for maintaining good relations with suppliers and treating
the suppliers as part of the company. Even though these parties are outside the company,
they will have a major impact on the business.
16) Supervision
The work of an entrepreneur is not limited to production and manufacturing activities as
he/she is also responsible for supervising and guiding the laborers in the company. The
major role of an entrepreneur is to supervise the employees according to the business
requirement. The entrepreneur should also guide the employees in the business. By doing
so, the entrepreneur reduces the confusion and reputation of the work. The entrepreneur
will act as a guide to the employees according to his or her knowledge and experience
and the entrepreneur can support the employees in the company
17) Payment to all factors of production
When the business is small and is new in the market, the entrepreneur will
perform all the roles and responsibilities of different managers. As a finance
manager, the entrepreneur will be responsible for the distribution of the
salaries and making the payment to all the factors of production. The
entrepreneur is responsible for arranging the sources of finance in the market
and providing the employees and other related staff with payment.

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18) Maintaining and delivering the quantity of production
The entrepreneur is not only responsible for maintaining the quality of the product
and delivering it to the customers but is also responsible for maintaining and
delivering the set quantity of the product to its customers. The company should be
capable of producing bulk products and delivering them to the market. The
entrepreneur should design the business model in such a way that urgent business
orders can also be flow in the production managed by the employees.
19) Risk-taking
Risk is uncertain and is not visible and the role of the entrepreneur has increased danger
and is not visible as well. The entrepreneur will have to prepare himself for the
unforeseen risk in the market. The entrepreneur is an individual who will undertake
different types of risks in the market so that the company can deliver the best in the
market and can get a competitive advantage. The entrepreneur is always surrounded by
various types of risk and will always have to work in difficult situations. The
entrepreneur will be responsible for always delivering his best in the market and avoiding
the various types of risk will result in no competitive advantage. The entrepreneurs could
avoid the risk through proper analysis and research about the market. The entrepreneur
should also have the ability to handle the risk. He can analyze the risk of government
regulations, market condition changes, and competitors. The entrepreneur can benefit
from the industry if he can effectively handle the risks.

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Types of entrepreneurs
They are different types of entrepreneurs according to the nature and size of the business and
according to the investment done by them. Innovation and creative minds also differentiate the
entrepreneurs. The entrepreneurs are also differentiated based on domestic and international
reach.
1. Innovating entrepreneurs
This type of entrepreneurs is those that discover new ideas and business opportunities in the
market. This engaged in the identification of the problems in the market and converting them
into innovative concepts. They produce new products or services, discover a new method of
production, or improve the existing business model. These entrepreneurs also identify the new
market and recognize the enterprise in the market. This type of entrepreneurs is found in
developed countries because the entrepreneurs have more risk-taking capacities and are engaged
in high satisfaction of the customers.
2. Drone entrepreneur
This type of entrepreneurs is those that refused to adopt new technologies and identity the
opportunities in the market. They do not adopt opportunities in the process of production and are
ready to suffer loss. They do not want any changes in their production methods and want to stick
to the traditional method of production. This type of entrepreneur resists adopting innovative
strategies and does not give importance to the survival of the business. They give importance to
the conventional methods of production and the product. These types of entrepreneurs do not
want any changes in the production and delivery of the products and services.
3. Opportunists‟ entrepreneurs
The success of the entrepreneur is based upon the opportunity. This type of entrepreneurs
believes that identifying business opportunities in the market leads to success and wealthy in the
business. These entrepreneurs have more focus on converting business problems into
opportunities. It is very necessary to identify the business opportunities so that customer
satisfaction can be achieved.
4. Imitative or adoptive entrepreneur
These types of entrepreneurs are ready to adopt the innovation strategies that are being created
by the innovative entrepreneurs. Instead of identifying and developing innovative strategies and
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BSEE ONE SEM ONE @2023.
technologies in the market, they usually imitate the technologies and techniques that are being
innovated by others in the market.
These entrepreneurs resist developing the technologies and techniques. These are the sources of
generating income and creation of wealth for underdeveloped countries. These types of
entrepreneurs are mostly found in underdeveloped countries because the entrepreneurs do not
have sufficient funds to invest in research and development activities. Therefore, they imitate the
technologies and techniques from the advanced countries and other entrepreneurs in the national
and international market. These types of entrepreneurs take less risk and avoid uncertainty in the
business.
5. Fabian entrepreneurs
These types of entrepreneurs are very cautious about the performance in the market and they take
calculated risks while adapting to any change in the business. They do not have the willingness
to introduce new changes in the business or change the methodologies and techniques of the
business. These types of entrepreneurs hesitate in taking risks and depend upon the religion and
traditions of their culture. Fabian entrepreneurs are mostly seen in underdeveloped countries
because these types of entrepreneurs only follow example of their predecessors.
6. Small scale entrepreneurs
Small business entrepreneurs are those that majorly operate in a small geographical area. The
objective of these types of entrepreneurs is to satisfy the demands and needs of the local
customers. These types of entrepreneurs do not adopt innovative strategies and do not give
importance to innovative factors. These types or entrepreneurs take loans from their friends and
families. The employees of small-scale entrepreneurs are usually family members or relatives.
7. Large scale entrepreneurs
Large-scale entrepreneurs are those that usually operate in different geographical areas. These
types of entrepreneurs might not have international reach but they have different business outlets
in the country. The major objective of these types of entrepreneurs is to satisfy the requirements
and the demands of the larger customers. They usually adopt innovative strategies and hire
professionals to sustain themselves in the market.

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 8. Scalable startup entrepreneur
This type of entrepreneur was starting a business with a unique idea that can bring a change in
the market. Firstly, they identify the demand and the requirements in the market. They find a
solution by launching a new product idea. These startup businesses receive funding from a
venture capitalist that provides funds for innovative business ideas. The major objective of the
entrepreneur is to expand their reach in the market and they hire specialized employees that
could work according to the market requirement.
9. International entrepreneur
International entrepreneurs are those entrepreneurs that operate within National boundaries and
international boundaries. They are usually referred to as multinational companies that have other
businesses to reach in the international market. International entrepreneurs will get the benefit of
increased sales and revenue when the revenue and sales are decreasing in the domestic market.
The entrepreneurs can supply the products and services in the international market and increase
their market reach.
10. Social entrepreneur
Social entrepreneurs identify the social problems of the people and develop services and products
that meet society's requirements. These types of entrepreneurs do not have the objective of profit
but they focus on solving the social issues and try to bring a social change in the business. These
types of social changes could be related to sustainable development, providing social benefit to
the entrepreneurs, and engagement in environment-friendly products. The major objective of this
product can be the development of society by providing employment opportunities to rural
employees. Social entrepreneurs are engaged in privatizing a social change in the environment
by ensuring sustainable financial growth. These types of entrepreneurs usually, follow ethical
practices and fulfill corporate social responsibilities to achieve success in the business.
11. High-tech entrepreneur
These types of entrepreneurs are engaged in implementing highly modified technologies. They
merge technology and manpower for developing the product or building the business in the
market. The highly technical entrepreneurs will require specialized talent and skills in the
employees to handle technology, these types of entrepreneurs take calculated risks that could
give profit in the future. These entrepreneurs can bring a change in the market through the

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BSEE ONE SEM ONE @2023.
revolution. These entrepreneurs focus on implementing technology-based production in the
business.
12. Agricultural entrepreneur
Agriculture entrepreneurs are the ones that are engaged in producing agricultural-based products.
The major objective of these types of entrepreneurs is to develop agricultural tools and
techniques. They provide modified technologies and equipment to the farmers and are
consistently involved in innovation activities. These types of entrepreneurs undergo research and
development activities for analyzing the machinery and equipment used in farming in the
international market. These types of entrepreneurs try to develop the machinery and equipment
in the country and try to adopt new technologies from the international market. Agricultural
entrepreneurs are dedicated to agricultural equipment and machinery.
13. Service entrepreneurs
Service entrepreneurs provide different types of services to the customers in the market. The
major objective of service and preparation is to provide services related to the product or are
purely involved in delivering services. These entrepreneurs could be advisory organizations and
consultancy companies. The major work of these service organizations is to provide consultants
and advisors related to the subject matter.
14. Researcher entrepreneur
These types of entrepreneurs are always engaged in research and development activities and try
to find out market opportunities while launching products after research. These entrepreneurs
believe in collecting the right information regarding the market and achieving success in the
business. They give more importance to information and data. Before launching the business
plan in the market these entrepreneurs create a detailed report and analyze the outcomes and
findings to minimize failure in the future.
15. Rural entrepreneur
Rural entrepreneurs are those that are being developed in the rural market and only have the
objective of fulfilling the requirements of the rural area customers. Rural entrepreneurs are being
developed in the villages and they provide employment opportunities to the workers and
employees in the rural area. The major objective of rural entrepreneurs is to earn profit and
provide employment opportunities to the people.

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BSEE ONE SEM ONE @2023.
 16. Cyber entrepreneur
Cyber entrepreneurs are those that function and operate in software and technologies. These
types of entrepreneurs provide products and services to customers over the internet. Software
development companies are the example of a cyber-entrepreneur. The need for the digital world
has evolved the cyber entrepreneurs in the market. These entrepreneurs exist on virtual
platforms. Online shopping applications and software are examples of cyber entrepreneurs
because they do not have area presence but they provide products and services to the customers
at the doorsteps by allowing the customers to select from a mobile application. The need for
cyber entrepreneurs is increasing and the competition amongst these entrepreneurs is increasing
with the increasing demand. These types of entrepreneurs either can deliver their product and
service on a virtual platform or can also act as an intermediary for delivering the products and
services of other companies in the market. The major advantage to this type of entrepreneur is
that they do not have to create a physical store for products or services.

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BUSINESS IDEAS
It is the reason of business existence and the pillar of any business success. Business ideas must
satisfy a wide range of criteria to be tenable. Many businesses fail soon after start-up because the
idea or the force is not commercially viable and cannot sustain a profit-making enterprise.

What is a business idea?

Business idea is the reason for setting up a firm. It drives everything about the company, from
what products and services are offered to how these products are marketed. This idea doesn’t
need to be unique, but it must have the potential to capture part of its target market. Put another
way, it must offer something different from companies already working in the marketplace
otherwise their credentials and head start will make it practically impossible for you to compete.

Types of potential business idea:

1) A gap in the market
2) New product, service or invention
3) Innovative solution to an everyday problem
4) An interest or hobby that can be monetized
5) Utilized skills you’ve learned in your career

Importance of business idea

Enough of a market
There needs to be sufficient demand for your product, services, or you will not be able to
generate any profit. If the market is growing then this is even better as investors are more likely
to contribute and there is more chance of your business growing in the future. Your market must
also be sustainable. Market research is to be conducted essentially to check if your business idea
is viable and profitable.
Able to generate a profit
Business ideas must not only sound good; they must be commercially viable. Unless you can
prove your idea can generate serious profit, its unlikely investors will back you. This is where
research is essential; you need to find out how much it’ll cost to make your product and how
much you’ll sell it for, factoring it essential costs such as salaries, manufacturing costs, expenses
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and raw materials. If your idea cannot turn a profit then you either need to pick another idea or
find out why it won‟t be profitable and take steps to monetize it. Speaking to an experienced
businessperson may help.
Potential for further growth
The best businesses do not only turn a profit but also show potential for further growth, whether
this manifests as an expanded product range or activity in new markets. This is why operating in
an expanding sector is preferable as you will be more able to take advantage of emerging
marketing avenues and ensures your reach is always maximized. The web is another very
important topic; if you cannot leverage the Internet to increase sales and expand your customer
base then you may have problems in the future.
Serves a purpose
Products must solve a problem or serve a purpose or there is unlikely to be any demand.
Customers must feel there is long-term value in your products or will be unlikely to buy from
you. In addition, this value must be clear – murky benefits will be difficult to sell. Unless you
can quickly and clearly prove your products not only solve a problem, but also do so more
efficiently than products supplied by your competitors, you will have a hard time selling your
services.

Commercial viability
Your business idea must work within the constraints of a start-up business. Conceptually, ideas
may look like moneymakers but unless they are able to be made and sold profitably and linearly
then it will be next to impossible to commercialize the idea. Likewise, inventions may require
such large amounts of start-up capital to render them untenable. If your business idea focuses on
a product, speak extensively to manufacturers before starting-up to ensure you can get the
product produced cheaply enough in the early stages. If you can’t, it’s time to have a rethink.

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BSEE ONE SEM ONE @2023.
TYPES OF BUSINESS IDEAS
There are many ways to categorize different businesses ideas. For this purpose, we will
categorize them into three general types: innovative, commoditized, and hybrid, which is a mix
of the two.
There are other ways to categorize business ideas. For example, we could have made a
distinction of high tech business ideas, and low-tech ideas. We could have also made a
distinction between local businesses and ones that operate globally or online or offline.
Innovative Business Ideas
These are ideas that portray a high level of innovation and come up new commodities or new
ways of doing things. It could also be new kinds of gadgets, smart phones, tablets, or other
electronic devices.
The great thing about these kinds of ideas is that they lead the way for everyone else. They create
completely new markets and for a short time get a lead over other kinds of businesses. They tend
to also have potential to grow rapidly, and for that reason, are attractive investments for venture
capital and seed investors.
The problem with innovative businesses is that precisely because they are new, and their
products are also new, no one really knows what the demand for them will be, and how well they
will ultimately grow, or whether they will not find market acceptance.
Figuring out how to get the market to accept their products, and how to market and grow their
business is up to the founders of companies with innovative products. So while innovating is
exciting, it adds a whole layer of risk that customers may not ultimately be interested in their
products. Other kinds of companies never have to face this particular risk. Let's consider some
types of business ideas that do not have that kind of a market adoption risk.
Commoditized Business Ideas
There are many types of businesses which have been around for a long time that do not have to
innovate, and can still be great businesses. Just think about the different businesses in any city.
Every city needs restaurants, cleaners, dentists, mechanics, people to fix homes, etc. The list goes
on. The core differences between these types of businesses and innovative businesses are that
these tend to be service-based business with a local focus. For that reason, these have less
potential to become multi-billion dollar businesses. Additionally, they do not grow as quickly.
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However, the great thing is that there is no risk of demand. There is definitely demand for these
kinds of businesses as long as the entrepreneur can provide the service with a high-enough
degree of quality.
NB: If you are considering starting such a business, since it is commoditized and has been done
successfully many times in the past, there should be almost no part of it that you are not sure of
once you start. There is knowledge out there for how to start it, promote it, and run it, how much
money is needed and how to spend that money wisely, etc.
Hybrid Businesses
What we refer to in this article as hybrid business ideas are the kinds of ideas, which borrow a
little bit from both, the commoditized types of ideas and the innovative. They are traditional
types of businesses, but with a new twist on their main product, which adds value to the existing
product.
There is a bit of a balance of innovation risk vs. commoditized business, which has an added
benefit of giving customers a good way to differentiate the business from other similar
businesses.

Stages to Develop Business Ideas

Before a business venture is launched, one needs to first to have a business idea. The better the
idea is, of course, the more successful the business can be, but having a good, idea is not enough.
Even the best ideas need grooming before they are ready to take center stage.
Business Idea Development Process
Developing a good, business idea begins with finding one. From there, the entrepreneur needs to
evaluate and refine that initial, raw idea into something marketable. The following are the phases
to develop new business ideas:
1. Idea Generation
Ideas can come from anywhere, including your customers. In fact, in business-to-business (B2B)
markets, customers are probably the biggest source of new product ideas. Customers know what
customers need and want, which provides organizations an indication of market needs.

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Customers who are good at generating new product ideas or applications of products are called
lead users.
2. Idea Screening
Not all new product ideas are good ones. The purpose of idea screening is to try to avoid
mistakes early in the development process. The sooner bad ideas are discarded, the less the
investment made and lost. In the idea screening stage, the company tries to evaluate the new
offering by answering these questions:
➢ Does the proposed product add value for the customer? Does it satisfy a market need?
➢ Can the product be made within a stated time to get it to market when needed?
➢ How many units of it will sell and at what price?
➢ Can we manufacture and sell the product within budget and still make money?
➢ Do we need to provide the customer with after-sales service? If so, do we have the
resources to do that?
➢ Does the product fit our image and corporate strategy?
3. Feature Specification
The next step involves narrowing down the product’s features. Again, price enters the picture as
the company considers which features are important to consumers at different price points. A
premium (high-priced) offering is likely to be loaded with extra features. By contrast, a low-
priced offering is likely to be a basics product with few features.
4. Development
In the development stage, the actual offering is designed, specifications for it are written, and
prototypes of it are developed. It is also during this stage that the firm considers the product is
manufacturing process. For example, when a restaurant is developing a new dish, it must not
only taste good; it must also be a dish that can be made in a reasonable amount of time once it’s
ordered and prepared at a cost that earns the restaurant a profit.
5. Testing
During the testing stage, the offering is tested, first in the lab and then with real customers. Lab
testing is also called alpha testing. Alpha testing ensures that the offering works like it is
supposed to in a variety of different environments that it meets its specifications, that is.
During beta testing, actual customers make sure the offering works under real-world conditions.
Beta testing not only tests whether the offering works as advertised but also tests the offering’s
delivery mechanisms, service processes, and other aspects of marketing the product. This step
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can be an expensive. Depending on the product, some companies might find it better to simply
launch the product and let the market respond to, or test, it once it is available for purchase.
6. Launch or Commercialization
Once an offering has been designed and tested, it is made available to customers. Sometimes a
company launches the offering to all of its markets at once. Other companies may use a rolling
launch in which the offering is made available to certain markets first and then other markets
later. A rolling launch might make sense if the company’s service technicians need training. The
company makes the offering available to one market and assesses its success and how it
performs in relation to its substitutes.
7. Evaluation
Once an offering is launched, a firm’s executives carefully monitor its progress. For types of
offerings, important milestones might be the first ninety days after the product is launched,
followed by a second period of ninety days, and so forth. However, be aware that firms are
constantly in the process of evaluating their offerings and modifying them by either adding or
subtracting the features and services associated with them, changing their prices, or how they are
marketed. The length of time for milestones used to evaluate products may vary depending on
the organization and other products or services being developed.

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By Mr. Oluka Isaac. [email protected] +256- 775906862/755906862
BSEE ONE SEM ONE @2023.
 CREATIVITY AND INNOVATION
If one wants to go along with the world, then the only requirement is to be creative and
innovative.
While Creativity is related to „imagination‟, but innovation is related to „implementation‟.
The primary difference between creativity and innovation is that the former refers to conceive a
fresh idea or plan, whereas the latter implies initiating something new to the market, which is not
introduced earlier.
1.1. Comparison Chart
BASIS FOR CREATIVITY INNOVATION
COMPARISON

Meaning Creativity is an act of creating new Innovation is the introduction of

ideas, imaginations and possibilities. something new and effective into the
market.

Process Imaginative Productive

Quantifiable No Yes

Related to Thinking something new Introducing something new

Money Consumption No Yes

Risk No Yes

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Definition of Creativity
Creativity is the characteristic of a person to generate new ideas, alternatives, solutions, and
possibilities in a unique and different way.
Creativity is the ability to conceive something unpredictable, original and unique. It must be
expressive, exciting and imaginative. It is the mirror of how beautifully a person can think in any
given circumstance.

Definition of Innovation
Innovation is an act of application of new ideas to which creates some value for the business
organization, government, and society as well. Better and smarter way of doing anything is
innovation. It could be the introduction of:
➢ New technology.
➢ New product line or segment.
➢ A new method of production.
➢ An improvement in the existing product.
Innovation is closely tied to creativity i.e. putting creative ideas into action is an innovation,
whose consequences should be positive. It is the process of doing something better for the first
time, which was not previously done by any entity. It can also be termed as a change, which can
bring a new edge to the performance and productivity of the company. It is of two types i.e.
evolutionary and revolutionary.

Key Differences between Creativity and Innovation

The following are the major differences between Creativity and Innovation:
1) The quality of thinking new ideas and putting them into reality is creativity. The act of
executing the creative ideas into practice is innovation.
2) Creativity is an imaginative process as opposed to innovation is a productive process.
3) Creativity can never be measured, but Innovation can be measured.
4) Creativity is related to the generation of ideas, which are new and unique. Conversely,
Innovation is related to introduce something better into the market.
5) Creativity does not require money. On the other hand, innovation requires money.
6) There is no risk involved in creativity, whereas the risk is always attached to innovation.

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Example
The invention of the motorcycle was the biggest innovation over scooters. In early centuries,
people used to travel with scooters, for which they have to make lots of efforts to start it like they
need to strike the kick and knee down from either side if it doesn’t start. Therefore, years and
years passed away, and nobody even thought for the invention of bikes. The invention of the
motorcycle makes them realize that they can also ride bikes without making any extra efforts;
they just have to click the switch and its starts automatically.
In this example, the thought of creation of a new traveling motorcycle is creativity, but the actual
invention of it is innovation.
There is always a dispute between creativity and innovation as both are important for an
organization to last longer. The existence of both can lead to success. After a huge discussion,
let’s know about how we can be creative by asking questions, drawing conclusions,
experimenting & exploring new ideas and widening the areas of thinking. For being innovative, a
person must have the ability to take risks, experimenting, asking questions and observing things.

Types of innovation
1. Open Innovation
The term open innovation means a situation where an organization doesn‟t just rely on their own
internal knowledge, sources and resources (such as their own staff or R&D for example) for
innovation (of products, services, business models, processes etc.) but also uses multiple external
sources (such as customer feedback, competitors, external agencies, the public etc.) to drive
innovation.
2. Closed Innovation
A closed innovation is based on the view that companies themselves develop innovations. From
the generation of ideas to development and marketing, the innovation process takes place
exclusively within the company.
3. Product innovation
Product innovation is the process of creating a new product or improving an existing one to meet
customers’‟ needs in a novel way.

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 4. Process innovation
A process innovation is the implementation of a new or significantly improved production or
delivery method. This includes significant changes in techniques, equipment and/or software
5. Social innovation
Social innovation refers to the process of developing and implementing new, effective solutions
to solve social or environmental issues. Whether these come from national policies,
governmental or non-governmental entities, such solutions should meet current social needs
better than it has been done before.
6. Marketing innovation
A marketing innovation is the implementation of a new marketing method (marketing idea or
strategy) that differs significantly from the previous marketing method used by the enterprise and
that has not been previously used by the enterprise
7. Incremental innovation
Incremental innovation is a series of small improvements or upgrades made to a company's
existing products, services, processes or methods. The changes implemented through incremental
innovation are usually focused on improving an existing product's development efficiency,
productivity and competitive differentiation
8. Radical innovation
Radical innovation can be summarized as a combination of new, revolutionary technology and
new ways of conducting business, radical innovation goes far beyond incremental innovation,
while incremental steps optimize existing products or services, radical innovation changes how
we live or how companies conduct business. Also referred to as “Disruptive Innovation” in a
business context, the term offers a management concept with the goal of growth for the next five
to ten years.
Can you imagine a life without personal computers? This shows exactly the power of disruptive
innovation. PCs have not only changed the way we communicate or consume media but also
spilled over to all other branches of the business world.
9. Technical innovation
Technical Innovation is the process of implementing new ideas, related with practical knowledge
or experience, into a productive process.

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Technical innovation results in lower production costs or greater value added. Lower production
costs can arise from better production processes. Greater value added can arise from new features
or higher quality
10. Business innovation
Business innovation is when companies implement new processes, ideas, services, or products
with the goal of boosting the bottom line. It could mean launching new and improved products or
services (which can lead to higher revenue), making an existing process more efficient, or
solving a current business problem (both of which cut down on costs and save time). A business
focus on brainstorming, design thinking, or the establishment of an innovation lab can drive
business innovations. The key element of innovation is that it drives revenue for the company.
11. Value innovation
The innovation is implemented to introduce new technology in the market and crate business
value. These types of innovation are being implemented to crate and differentiate the product in
the market. Tries value innovation: the company tries to deliver improvements made by any
company at a particular time.

Benefits of innovation in organizations

Innovation is the driving force to hunt for new possibilities and opportunities. In education, it has
the power to make a difference by implementing practical knowledge. It also determines the
growth of any organization. New ideas and products are created which helps a business stay
competitive in an ever-changing market.
1. Innovation Drives People to Find Opportunities
Boredom is bound to strike any place at some point in time. It is not something we want, but it
takes effect, nevertheless. Innovation can be an antidote for this boredom that sets in once the
novelty of a situation wears off.
Innovation changes the way we live our lives. A driving force encourages us to go beyond
boundaries and find opportunities. It opens our minds to new possibilities

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2. Innovation is Important for Personal Growth
Creativity drives your brain to think and seek new opportunities. It helps you get out of the box
and research concepts that are not conventional. Your imagination is unleashed with innovative
ideas, which help you come up with something unique and original.
3. Innovation Boosts Creativity & Confidence
Creativity also helps reduce the fear of making mistakes, which will lead people to do great
things on their own. It encourages people to take more risks that may end up in failure but it is
still worth it because these failures eventually pave the way for success.
4. Innovation flourishes education
The future of education depends on innovation as well. Educational institutions around the world
are now providing students with hands-on experience. This helps them learn better and work
towards building careers that interest them.
5. Innovation works with Technology
The human race is always trying to do better than before. This feeling has led us to greater ways
to achieve our goals.
Innovation does not necessarily mean coming up with something original. It is more of finding
ways to use what is already available, in a better way of combining different ideas, to create
something completely new.
6. Innovation Increases Productivity
Productivity is crucial for business owners and employees alike. It helps them get more work
done by finding new solutions or coming up with better ways of doing things without straining
resources.
Without innovation, the world would be stuck with old ideas and traditional ways of doing
things. It is because it contributes to increased productivity in the workplace.
Innovation motivates employees and inspires them to new ways to improve their work.
By fostering a culture of innovation, a business can reap many benefits and continue to thrive.
7. Innovation Creates Better Products & Services
Encouraged by the desire to come up with a top-notch product, innovation allows us to create a
better version of what we already have in the market.
New products and services are created with the customer in mind so that their needs are met,
whether it is through ease of use, more convenience, or an added benefit.

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8. Innovation Gives a Competitive Advantage
Penetrating new markets allows a business to stand out from the competition. Innovation is the
main driver of new ideas and finding ways to clinch the top position.
Being able to develop new products and services gives a company an edge over its competitors in
entering new markets. New developments can also open up a completely new stream of revenue
that was previously unavailable.
9. Innovation Impacts Economic Growth
Every business is important for the economy because it provides services to consumers. Without
innovation, companies would not be able to grow fast enough to stay afloat.
It helps businesses overcome obstacles of growth by thinking of new ways to address potential
problems. It allows them to create new products and services, expand their customer base, open
up new markets, or improve existing ones.
10. Innovation Determines Success
Innovation is key to success in business, entrepreneurship, or life. It can help you survive and
beat your competitors while helping you find new ways to enjoy the things that interest you.
Innovation can enhance a brand’s creativity, design thinking process, and nature. Learning the
stages of creativity is a new business’s best opportunity to achieve success.

11. Innovation Is Next To Prosperity

Innovation has the power to shape and define success and gives people the freedom to do what
they love. It leads them to be more creative while increasing their confidence levels.
A country’s growth largely depends on its citizens‟ creativity and ingenuity. Countries that
encourage innovation will prosper while the others will fall behind in terms of development,
security, education, employment opportunities, etc.
Innovation can do a lot for us in ways we never thought possible. It helps people reach their full
potential, allows them to discover new ways of doing things, and motivates them to become
better versions of themselves. It has a global effect.

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FORMS OF BUSINESS ORGANIZATIONS
Business is nothing but the one who is making money by selling or purchasing or producing
some products. The business provides profits and losses during the services or different stages of
a business. In addition, the business owner is responsible for the liability of debt that occurred
during the business. Types of ownership are explained below.
1. Sole proprietorship
2. Partnership
3. Co-operative Societies
4. Joint-stock company

Sole Proprietorship:
A sole proprietorship is a business run by a single person. Anyone can start a sole proprietorship
in Uganda. There is no minimum investment required to start this business. Sole Proprietorship is
a single-man business organization, who fully owns and manages the entire business under its
supervision. A sole proprietorship is a simple form of a business without any legal registration
and it is a suitable choice to run a small or medium scale business or industry. In a
proprietorship, a single owner pays the personal income tax from the profit of his business.
Many individuals do their business under their name and it does not require any unique name or
anything. It is a less regulated business from the government/legal side. A sole proprietorship has
unlimited liability and fewer legal formalities. In addition, the whole business is under the
control of a single person. A sole proprietorship has minimum compliance requirements.
A sole proprietorship is economical, as it requires minimum compliance with no requirement of
any auditor.

Advantages of a sole proprietorship:

✓ Cheap and easy
✓ Has limited government rules and regulations
✓ Personal income
✓ Easy to shut down
✓ Direct incentives/encouragement
✓ Easy modification
✓ Controlling
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 ✓ Privacy
✓ Tax advantages
✓ Suitable for small business

Disadvantages of a sole proprietorship

✓ Unlimited personal liability
✓ Less protection
✓ Limited resources
✓ Limited skills
✓ Less growth
✓ Limited business life
✓ Fundraising difficulty

Partnership
A partnership is a formal agreement between two or more parties or business individuals, to
manage and operate a business and share the profits from that business. In this partnership
method of business, all the liabilities and shares are equally divided between them. Partnership
firm is authorized either by a legal platform or without any legal business entity. A partnership
business or firm is started with a mutual interest and mutual understanding between the
parties. Therefore, whatever is happening in the firm internally or externally, both parties have
equal rights in it.

Features of Partnership
1. Formation
It means the number of people involved in a business. A minimum of two persons is
required for partnership. An agreement is established between those two partners. An
agreement can be either talk or written
2. Liability:
All the partners are responsible for the liabilities of their business. If the company's assets
are not enough to make up its business liabilities, private/personal properties are pledged
to cover the liabilities, and the liabilities can be solved with help of any one of the
partners who have enough financial background.
3. Risk bearing:
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 Partners should face all the types of risks affected in their business. They are equally
responsible for any loss. They should share the same loss or profit.
4. Decision making:
Decision-making is made by creating an agreement between the partners to avoid any issues
between them. In addition, they can initiate a representative for any decision making.
5. Continuity:
A constant partnership cannot be carried out because death, debt, or retirement will
cause a discontinuity in their business. In addition, remaining partners can run the
business with a new agreement.
6. Members:
According to the companies act, 2012 says about the number of members in a partnership,
the maximum number of partners should not be more than 20.
7. Mutual agency:
This is a legal tie-up between the partners in a partnership business.

Advantages of partnership
✓ Easy to form
✓ It is simple and less expensive to establish.
✓ It is cheaper and requires fewer paper works.
✓ Low taxation procedures.
✓ Easy to stop

Disadvantages of partnership
✓ Unlimited liability
✓ All are equally responsible for any debt or legal obligations

Types of partners
Active partner:
An active partner runs the daily activities of the entire business. Active partners contribute
capital to the business. They have an equal share in profit and loss. If the active partner wants to
resign/retire, he must provide prior notice .He is responsible for liabilities of tie business even
after his resignation/retirement, unless he provides a public notice.
Sleeping partner:
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The sleeping partner is not involved in any type of daily managerial activities. He will
be having huge investments in business, but not active in daily business activities. If he
wants to retire, then there is no need to give prior notice.
Secret partner:
The secret partner is the one whose partnership is unknown to the public. He never
participates in daily activities and business meetings. He is involved in providing capital and
also shares profit and loss of business and has unlimited liability.
Nominal partner:
The nominal partner will only be having a name in partnership. He does not provide any capital,
thus profit and loss need not be shared with him. However, he will be liable to outside people
and others for what his partners have done.
Partner by Estoppel:
Partner by estoppel is nothing but just claiming the partnership by a word, which is he will not be
an actual partner but will be acting like one.
Partner in Profits Only:
Only profit is shared and will not be responsible for any liabilities. He will only deal with all acts
of profit.
Minor Partner:
A minor partner is the one who is admitted to the advantage of a partner if other partners give
permission. He will be sharing the profits but his loss will be limited to his hare in the business.

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Cooperative Societies
Cooperative societies mean working together which means an association of individuals who join
and work together for the objective of the welfare of the members. Such societies aim to protect
their economic interest from the hands of intermediaries’ preoccupancy with a desire of making
higher profits.

Features of Cooperative Societies

Voluntary membership:
Anybody can join or anyone can leave as per his desire. Membership is open to all caste,
religions, or any gender.
Legal Status:
Registration for cooperative societies is necessary. It gives an identity to society that is distinct
from its members.
Limited Liability:
The liability of the members in cooperative societies is limited, which is an extent to the total
amount contributed by the members.
Control:
An elected managing committee carries all the decision-making and controlling activities.

Service motivation:

The purpose of cooperative societies is to help in the welfare of their members. If any profits are
generated, it is given to all members equally.

Advantages of cooperative societies

✓ It is easy to form
✓ It has the Government full support
✓ Economy in business Liability is limited.
✓ Equality in voting

Disadvantages of cooperative societies

✓ Resource availability is limited
✓ Management is not in an inefficient way
✓ Open to all that leads to lack of secrecy
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 ✓ It has government control
✓ Different opinions exist

Types of cooperative societies:

✓ Consumers cooperative societies
✓ Producers cooperative societies
✓ Marketing cooperative societies
✓ Farmers’ cooperative societies
✓ Credit cooperative societies
✓ Cooperative housing societies

Joint-stock company:
A joint-stock company is a company in which all its business is owned and run jointly by all its
shareholders. The company's capital is divided into smaller parts called "shares". Many of the
large companies are joint-stock companies.

Features of Joint Stock Company

Artificial Person:
An artificial legal person can hold property in his name. The law creates it. It is independent of
its members. Individuals cannot do anything. Here, companions can borrow, transfer,
buy/purchase, or can enter into the contracts. The company can do anything. The company can
charge or be charged.
Separate Legal Entity:
It has a separate legal entity apart from the persons involved. Here assets, properties, liabilities
are separated from their owners. No one can take it as their personal property as the company has
its legal parameters. Therefore, it is separated from its members.
Formation:
Formation of the company is a time-consuming process. It will take more time to be formed.
Many legal papers and other rules and regulations are involved in it.
Perpetual Succession:
Law forms a Joint Stock Company. Whatever happens in the company, it is under the law only.
The company has continuity in its working. Even if someone new joins or leaves due to death, it
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will not affect the functioning of the company directly. All changes are under the law. Formation
and closure of the company are under the law
Control:
Board members elected by shareholders undertake the company’s management and control.
Liability:
The liability of the shareholders is limited. How much they contributed to the business, only that
much liability will affect them. No one could pay or pledge their assets to pay the debt liabilities
of a firm. That means the liability of members is limited to the maximum of capital contributed
by them.
Common seal:
A common seal is like a company's official signature. All the agreement approvals are carried out
through this common seal only. In addition, all the certificates, agreements, files, and other
value-added papers issued by a company must be validated or attested by a company seal.

Advantages of joint-stock company

✓ A large amount of capital
✓ Limited liability Continuity:
✓ Efficient management:
✓ Growth and expansion: Transfer of interest:
✓ High public confidence
✓ Social responsibilities

Disadvantages of Joint Stock Company

✓ Complexity in formation
✓ Lack of secrecy
✓ Lack of motivation
✓ Decision is delayed
✓ Too much control by the government
✓ Conflict in interest

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FEASIBILITY STUDY
A feasibility study is a detailed analysis that considers all of the critical aspects of a proposed
project in order to determine the likelihood of it succeeding.
Success in business may be defined primarily by return on investment, meaning that the project
will generate enough profit to justify the investment. However, many other important factors
may be identified on the plus or minus side, such as community reaction and environmental
impact.
In a feasibility study, a proposed plan or project is evaluated for its practicality. As part of a
feasibility study, a project or venture is evaluated for its viability in order to determine whether it
will be successful.
As the name implies, a feasibility analysis is used to determine the viability of an idea, such as
ensuring a project is legally and technically feasible as well as economically justifiable. It tells us
whether a project is worth the investment in some cases, a project may not be doable. There can
be many reasons for this, including requiring too many resources, which not only prevents those
resources from performing other tasks but also may cost more than an organization would earn
back by taking on a project that is not profitable.

Types of Feasibility Study

A feasibility analysis evaluates the project’s potential for success; therefore, perceived
objectivity is an essential factor in the credibility of the study for potential investors and lending
institutions. There are five types of feasibility study, which are:
1. Technical Feasibility
This assessment focuses on the technical resources available to the organization. It helps
organizations determine whether the technical resources meet capacity and whether the technical
team is capable of converting the ideas into working systems. Technical feasibility also involves
the evaluation of the hardware, software, and other technical requirements of the proposed
system.
2. Economic Feasibility
This assessment typically involves a cost/ benefits analysis of the project, helping organizations
determine the viability, cost, and benefits associated with a project before financial resources are
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allocated. It also serves as an independent project assessment and enhances project credibility
helping decision-makers determine the positive economic benefits to the organization that the
proposed project will provide.
3. Legal Feasibility
This assessment investigates whether any aspect of the proposed project conflicts with legal
requirements like environmental protection, data protection acts or social media laws. Let us say
an organization wants to construct a new office building in a specific location. A feasibility study
might reveal the organization’s ideal location is not convenient for that type of business. That
organization has just saved considerable time and effort by learning that their project was not
feasible right from the beginning.
4. Operational Feasibility
This assessment involves undertaking a study to analyze and determine whether and how well
the organization’s needs can be met by completing the project. Operational feasibility studies
also examine how a project plan satisfies the requirements identified in the requirements analysis
phase of system development.
5. Scheduling Feasibility
This assessment is the most important for project success; after all, a project will fail if not
completed on time. In scheduling feasibility, an organization estimates how much time the
project will take to complete.
When these areas have all been examined, the feasibility analysis helps identify any constraints
the proposed project may face, including:
➢ Internal Project Constraints: Technical, Technology, Budget, Resource, etc.
➢ External Constraints: Logistics, Environment, Laws, and Regulations, etc

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Business research
Business research is a process of acquiring detailed information of all the areas of business and
using such information in maximizing the sales and profit of the business. Such a study helps
companies determine which product/service is most profitable or in demand. In simple words, it
can be stated as the acquisition of information or knowledge for professional or commercial
purpose to determine opportunities and goals for a business.

Advantages of Business research

✓ Business research helps to identify opportunities and threats.
✓ It helps identify problems and using this information, wise decisions can be made to
tackle the issue appropriately.
✓ It helps to understand customers better and hence can be useful to communicate better
with the customers or stakeholders.
✓ Risks and uncertainties can be minimized by conducting business research in advance.
✓ Financial outcomes and investments that will be needed can be planned effectively using
business research.
✓ Such research can help track competition in the business sector.
✓ Business research can enable a company to make wise decisions as to where to spend and
how much.
✓ Business research can enable a company to stay up-to-date with the market and its
trends and appropriate innovations can be made to stay ahead in the game. Business
research helps to measure reputation

Disadvantages of Business research

✓ Business research can be a high-cost affair
✓ Most of the time, business research is based on assumptions
✓ Business research can be time-consuming
✓ Business research can sometimes give you inaccurate information, because of a biased
population or a small focus group.
✓ Business research results can quickly become obsolete because of the fast-changing

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BUSINESS PLAN DEVELOPMENT
A business plan is a document that defines in detail a company's objectives and how it plans to
achieve its goals. A business plan lays out a written road map for the firm from marketing,
financial, and operational standpoints. Both startups and established companies use business
plans.
Mar J. Dollinger has defined the business plan as “the formal written expression of the
entrepreneurial vision, describing the strategy and operations of the proposed venture.”
According to Jack M. Kaplan, “The term business plan means the development of a written
document that spells out like a roadmap where you are, where you want to be, and how you want
to get there. “Thus, a business plan or project report can best be defined as a well-evolved course
of action devised to achieve the specified objective, i.e. setting up a small business enterprise
within a specified period. So to say, business plan is initially an operating document.

Components of a Business Plan

1. Executive Summary
Your executive summary should appear first in your business plan. It should summarize what
you expect your business to accomplish. A good executive summary is compelling. It reveals the
company’s mission statement, along with a short description of its products and services. It
might also be a good idea to briefly explain why you are starting your company and include
details about your experience in the industry that you “reentering.
2. Company Description
A company description includes key information about your business, goals and the target
customers that you want to serve. This is where you explain why your company stands out from
other competitors in the industry and break down its strengths, including how it offers solutions
for customers, and the competitive advantages that will give your business an edge to succeed.
3. Market Analysis
This is where you show that you have a key understanding of the ins and outs of the industry and
the specific market you plan to enter. Here you will substantiate the strengths that you
highlighted in your company description with data and statistics that break down industry trends
and subjects. Show what other businesses are doing and how they are succeeding or failing. Your
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market analysis should also help visualize your target customers. This includes how much money
they make, what their buying habits are, which services they want and need, among other target
customer preferences. Above all, the numbers should help answer why your business can do it
better.
4. Competitive Analysis
A good business plan will present a clear comparison of your business vs your direct and indirect
competitors. This is where you prove your knowledge of the industry by breaking down their
strengths and weaknesses. Your end goal is show how your business will stack up. In addition, if
there are any issues that could prevent you from jumping into the market, like high upfront costs,
this is where you will need to be forthcoming. Your competitive analysis will go in your market
analysis section.
5. Description of Management and Organization
Your business must also outline how your organization is set up. Introduce your company
managers here and summarize their skills and primary job responsibilities. An effective way
could be to create a diagram that maps out your chain of command.
Do not forget to indicate whether your business will operate as a partnership, a sole
proprietorship or a business with a different ownership structure. If you have a board of directors,
you will need to identify the members.
6. Breakdown of Your Products and Services
While your company description is an overview, a detailed breakdown of your products and
services is intended to give a complementary but fuller description about the products that you
are creating and selling, how long they could last and how they will meet existing demand.
This is where you should mention your suppliers, as well as other key information about how
much it will cost to make your products and how much money you are hoping to bring in. You
should also list here all relevant information pertaining to patents and copyright concerns as well.
7. Marketing Plan
This is where you describe how you intend to get your products and services in front of your
target customers. Break down here the steps that you will take to promote your products and the
budget that you will need to implement your strategies.

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8. Sales Strategy
This section should answer how you will sell the products that you are building or carry out the
services that you intend to offer. Your sales strategy must be specific. Break down how many
sales representatives you will need to hire and how you will recruit them and bring them on
board. Make sure to include your sales targets as well.
9. Request for Funding
If you need funding, this section focuses on the amount of money that you need to set up your
business and how you plan to use the capital that you are raising. You might want to include a
timeline here for additional funding that you may require completing other important projects.
10. Financial Projections
This final section breaks down the financial goals and expectations that you have set based on
market research. You will report your anticipated revenue for the first 12 months and your
annual projected earnings for the second, third, fourth and fifth years of business.

NB: Every company is different so your business plan might look nothing like another
entrepreneur’s. However, there are key components that every good plan needs to have, and it‟s
always a good idea to provide a clear and accurate summary of your business goals in your
business plan.

Types of business plans

The following list of business plans are the most commonly used:
1. Startup plan
A startup plan is a business plan a new company gives to potential investors in the hopes of
receiving startup funding. Startup plans operate as initial plans that businesses can adjust as
needed as a company grows.
2. Strategic plan
A strategic business plan details the strategies a company will use to achieve its overall goals.
Most strategic plans include five main components:
✓ Company mission statement
✓ Company vision
✓ Key factors for company success
✓ Strategies to meet goals

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 ✓ Implementation deadline
Strategic plans are usually for internal purposes only as a foundational plan for an entire
organization. When creating this type of plan, management needs to assess the strengths of the
company and indicate areas that can improve by using a SWOT analysis. A SWOT analysis
stands for Strengths, Weaknesses, Opportunities and Threats and gives organizations a greater
awareness of factors that affect business decisions. By performing, a SWOT analysis
management can determine which strategies are best to implement to leverage its strengths,
choose the right opportunities and overcome potential challenges uncovered by the evaluation.
The deadline implementation portion of the strategic plan outlines how the chosen strategies
move the company toward its defined milestones. This may include guidelines for allocating
resources and key dates for completing various objectives.
3. Feasibility plan
A feasibility plan is written when a company is seeking a new business venture such as
producing a new product in an existing market or selling current products to a new market. This
plan type details what market will want to buy the product or service and if that new venture will
result in a profit worthwhile to the company. Feasibility business plans normally only include
information about how well a product will sell or if the proposed market exists and will provide a
high return on investments. This type of plan may require market research in the form of
crowdfunding or product testing to determine a product's viability in the marketplace.
4. Operations business plan
An operations plan, also called an annual plan, focuses on mapping out the day-to-day
operational activities a business needs to complete to achieve tactical goals and is part of
strategic planning. This plan type details the responsibilities of management, departments and
employees and how they contribute to the company's overall success.
5. Expansion plan
An expansion or growth plan is used when a company is looking to grow and the development
requires greater resources like a financial investment, materials for new products and an
increased number of employees. Businesses can create growth plans for external or internal
reasons and include different information.

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 6. one-page plan
A one-page plan highlights the most important parts of a lean plan, summarizing a business, and
is used to brief potential investors and partners about the basic details of the company. This plan
explains the company's product or service, who the target market it and includes a sales forecast.
It also includes a company description spotlighting the company's values and mission. This is
also known as a business pitch.

Importance of a business plan

What is the purpose of a business plan and why are business plans so important? Below are our
some of the reasons why businesses need a business plan.
1. To prove that you are serious about your business. A formal business plan is
necessary to show all interested parties: employees, investors, partners and the business owner
that you are committed to building the business. Creating your plan forces you to think through
and select the strategies that will propel your growth.
2. To establish business milestones. The business plan should clearly lay out the long-term
milestones that are most important to the success of your business
3. To better, understand your competition. Creating the business plan forces you to
analyze the competition. All companies have competition in the form of either direct or indirect
competitors, and it is critical to understand your company’s competitive advantages. In addition,
if you do not currently have competitive advantages, to figure out what you must do to gain
them.
4. To better, understand your customer. Why do they buy when they buy? Why don’t
they when they don’t? An in-depth customer analysis is essential to an effective business plan
and to a successful business. Understanding your customers will not only allow you to create
better products and services for them, but will allow you to more cost-effectively reach them via
advertising and promotions.
5. To enunciate previously unstated assumptions. The process of actually writing the
business plan helps to bring previously “hidden” assumptions to the foreground. By writing them
down and assessing them, you can test them and analyze their validity. For example, you might

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have assumed that local retailers would carry your product; in your business plan, you could
assess the results of the scenario in which this did not occur.
6. To assess the feasibility of your venture. How good is this opportunity? The business
plan process involves researching your target market, as well as the competitive landscape, and
serves as a feasibility study for the success of your venture. In some cases, the result of your
planning will be to table the venture. In addition, it might be to go forward with a different
venture that may have a better chance of success.
7. To document your revenue model. How exactly will your business make money? This
is a critical question to answer in writing, for yourself and your investors. Documenting the
revenue model helps to address challenges and assumptions associated with the model. In
addition, upon reading your plan, others may suggest additional revenue streams to consider.
8. To determine your financial needs. Does your business need to raise capital? How
much? One of the purposes of a business plan is to help you to determine exactly how much
capital you need and what you will use it for. This process is essential for raising capital for
business and for effectively employing the capital. It will also enable you to plan, particularly if
you need to rise additional funding in the future.
9. To attract investors. A formal business plan is the basis for financing proposals. The
business plan answers investors‟ questions such as: Is there a need for this product/service?
What are the financial projections? What is the company’s exit strategy? While investors will
generally want to meet you in person before writing you a check, in nearly all cases, they will
also thoroughly review your business plan.
10. To reduce the risk of pursuing the wrong opportunity. The process of creating the
business plan helps to minimize opportunity costs. Writing the business plan helps you assess the
attractiveness of this particular opportunity, versus other opportunities. Therefore, you make the
best decisions.
11. To force you to research and really know your market. What are the most important
trends in your industry? What are the greatest threats to your industry? Is the market growing or
shrinking? What is the size of the target market for your product/service? Creating the business
plan will help you to gain a wider, deeper, and more nuanced understanding of your marketplace.
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And it will allow you to use this knowledge to make decisions to improve your company’s
success.
12. To attract employees and a management team. To attract and retain top quality talent,
a business plan is necessary. The business plan inspires employees and management that the idea
is sound and that the business is poised to achieve its strategic goals. Importantly, as you grow
your company, your employees and not you will do most of the work. So getting them aligned
and motivated will be key to your success.
13. To plot your course and focus your efforts. The business plan provides a roadmap from
which to operate, and to look to for direction in times of doubt. Without a business plan, you
may shift your short-term strategies constantly without a view to your long-term milestones. You
would not go on a long driving trip without a map; think of your business plan as your map.
14. To attract collaborates. Partners also want to see a business plan, in order to determine
whether it is worth collaborating with your business. Establishing partnerships often requires
time and capital, and companies will be more likely to collaborate with your venture if they can
read a detailed explanation of your company.
15. To judge the success of your business. A formal business plan allows you to compare
actual operational results versus the business plan itself. In this way, it allows you to clearly see
whether you have achieved your strategic, financing, and operational goals (and why you have or
have not).
16. To reposition your business to deal with changing conditions. For example, during
difficult economic conditions, if your current sales and operational models are not working, you
can rewrite your business plan to define, try, and validate new ideas and strategies.
17. To document your marketing plan. How are you going to reach your customers? How
will you retain them? What is your advertising budget? What price will you charge? A well-
documented marketing plan is essential to the growth of a business. In addition, the marketing
strategies and tactics you use will evolve each year, so revisiting your marketing plan at least
annually is critical.
18. To understand and forecast your company’s staffing needs. After completing your
business plan, you will not be surprised when you are suddenly short-handed. Rather, your
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business plan provides a roadmap for your staffing needs, and thus helps to ensure smoother
expansion. Importantly your plan can not only help you understand your staffing needs, but
ensure your timing is right as it takes time to recruit and train great employees.
19. To uncover new opportunities. Through the process of brainstorming, white-boarding
and creative interviewing, you will likely see your business in a different light. As a result, you
will often come up with new ideas for marketing your product/service and running your
business. It is coming up with these ideas and executing on them, which is often the difference
between a business that fails or just survives and one that thrives.
3. Theories of entrepreneurship
Entrepreneurship consists of various theories because there are certain assumptions regarding
the internal and the external environment. The entrepreneur and the related parties need to
understand these theories so that the theoretical perspective related to entrepreneurship could be
cleared. It is further considered the intentions of the entrepreneur and includes the intentions of
the other related parties in the business. Different thinkers have different perspectives related to
entrepreneurship and they have tried to build different theories according to their research and
development.

1. Innovation theory:
Joseph A. Schumpeter started this theory. There are various assumptions regarding the
innovation theory. The entrepreneur has the objective of developing something new in the
market. The entrepreneur will try to implement creative concepts and his or her experiences to
fulfill certain tasks in the organization.

This theory states that when an entrepreneur decides on implementing innovation

activities in the business the entrepreneur is disturbing the circular flow of the economy.
Because before the innovation activities the circular flow of the economy was stable and
when innovation activities were implemented the circular flow was being disturbed.

This will lead to disequilibrium in the economy. There could be various reasons for
innovation activity. The major objective of any entrepreneur is to generate profit and to

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attain a certain level in the economy. This could be done through innovation activities The
innovation could be of new products, methods of production, entering into a new market,
and recognizing the new source of supply of raw material.

2. Social change theory

Max Weber is stating this theory. This query was devoted to the social changes in the
environment. According to this theory, the religion and ethics of the people have a greater
impact on entrepreneurship. Religion, beliefs, and ethics play a very important role in the
entrepreneurial culture. This theory has a concept of capitalism. It refers to the economic
system in which the market forces of demand and supply are allowed to play freely. The theory
focuses on the impact of entrepreneurship through religion. Different religions have different
assumptions and different perceptions regarding entrepreneurship. He believes that Hinduism
did not encourage entrepreneurship activities. Because Hinduism lays minimum emphasis on
wealth creation. This created a mental attitude in the society and it depends upon the religious
beliefs of the people. There was certain criticism regarding this theory because this theory is
invalid and does not have realistic assumptions.
3. Uncertainty bearing theory:
Frank H. Knight gave this theory. According to this theory, an individual or an entrepreneur
cannot estimate the probability of uncertainty and the risk in the business. Because the
entrepreneur and entrepreneurship activities are being affected by multiple factors so the
probability of their occurrence cannot be statistically estimated. In this theory, a major
assumption is being made regarding the nature of the entrepreneurs. The entrepreneur
undergoes the entrepreneurship activities on pure profit by undergoing uncertainty activities.
The reward and the profit are uncertain but entrepreneurs offer wages and salaries to the
employees regularly. The criticism of this theory is that the theory describes the role of the
entrepreneur to bear uncertainty.
4. Entrepreneurial group theory:
Frank W. Young founded this theory. This theory states that the development of any
entrepreneur is based upon the entrepreneurial groups in the organization. This theory states that
the behavior of any individual is being affected by the behavior of a group or the group level
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pattern. The entrepreneurs of the individuals in the organization worked as a part of the group
and the behavior of the group had a major influence on the individual's behavior. The family
background and the members of the family affected the general values of the group because
through these groups the entrepreneur gets experiences and exposure to stay in the market. The
initiatives and the actions of any entrepreneur are the outcomes of the experience generated
through family background and the group members. The emphasis of the group members and the
values of the group members have a major impact on the individual's performance. An individual
entrepreneur will take any easy tips and will perform better because of the group behavior.
5. Economic theory of entrepreneurship
This theory was stated by Pepuek and Hassis. According to this theory, the major objective and
main factor of any entrepreneur is the economic incentives. Economic gains in the business
initiate creative ideas and entrepreneurial initiatives. Any business that is being established in the
market has some economic objective that is generation of profit. The psychological motivation of
the entrepreneur is the economic gains that will lead to an increase in income and profit of the
company. These psychological economic benefits are necessary to stay in the market and
develop economic motivations 6. Theory of need of achievement
Mc Clelland gave this theory. According to this theory, there are certain achievements and there
is a desire in the entrepreneur's mind to achieve certain goals in the business. These
achievements are related to specific activities. These achievements are also based upon the past
performance of the entrepreneurs. The achievements could be related to becoming excellent in
the market and it is a natural human tendency that every individual wants to achieve something
better than the previous one. According to this theory, a major factor of entrepreneurship
development was being recognized. There is always a desire in the mind of the entrepreneur to
achieve development and success in the business. The achievement in the business could be done
through organizing motivational training programs for the entrepreneurs so that they could
improve their skills and abilities in the business.

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7. Behavior theory
John Kunel gave this theory. According to this theory, the development or any
enterprise is dependent upon the existing and past social aspirations. This theory has
the following essential elements.
➢ The behavior of the individual could be transformed into entrepreneurship by demand
composition.
➢ The opportunities in the market could be identified due to various factors such as training
opportunities, and production methods.
➢ The labor composition is constituted of different factors such as aspiration of life.

8. Cultural value theory

Kroken developed this theory. According to this theory, the major emphasis of entrepreneurship
activities is on the cultural values and social approvals of the people for entrepreneur
development. The entrepreneur is the role model and personality for the society so the
entrepreneur must have cultural values and expected rules for economic development. Ihe major
emphasis and the success of the entrepreneur are being influenced by the determination of an
entrepreneur towards his or her work and profession. The other factors will include the functional
requirements of the business group and the expectations of the group about the role of the
entrepreneur in the business; The role of the entrepreneur is known not only to guide the business
and generate profit but should also motivate the business entities.
9. Baumol's view on entrepreneurship
According to Baumol, the role of an entrepreneur is very important for the economic growth of
the company. The economic growth of the organization is dependent upon the output and the
price of the product. According to him, a hypothesis was being created that stated that the supply
of the company varies according to society. Productivity is being affected by multiple factors and
the entrepreneur should reduce the unproductive activities in the organization to generate more
economic wealth.
10. Peter Drucker's view on entrepreneurship
The entrepreneurs always have the objective of generating a profit and the entrepreneur will
search for various unique aspects in the market that could give various opportunities. He focused

By Mr. Oluka Isaac. [email protected] +256- 775906862/755906862

BSEE ONE SEM ONE @2023.
on successful innovation activities of an organization so that the company can get the benefit of
innovative opportunities in the market.

By Mr. Oluka Isaac. [email protected] +256- 775906862/755906862

BSEE ONE SEM ONE @2023.