Entrepreneurial Skills Class 10 Notes AI CBSE

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This page will contain all the roles and importance of Entrepreneurship. It will help you to understand the importance of Entrepreneurship.

Entrepreneurial Skills comes under Unit 2 of Artificial Intelligence Curriculum for Class 10 CBSE Skill Subject Code 417.

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Entrepreneurial Skills Glossary Class 10

Introduction	Entrepreneurship and Society	Entrepreneurship activities
Qualities of an Entrepreneur	Functions of an Entrepreneur	Role of Entrepreneurs
Importance of Entrepreneurs	Myths of Entrepreneurship	Entrepreneurship as a Career

Entrepreneurial Skills Overview

What is Entrepreneurship?

While some qualities and skills are observed in successful entrepreneurs, an entrepreneur has to perform certain functions to form an enterprise. There are pros and cons involved with choosing the entrepreneurial path.

Entrepreneurship and Society

Entrepreneurship and Society move Hand-in-Hand as an entrepreneurial activity that the society is provided with goods and services. In turn, society provides a market for products and services provided by the entrepreneur.

Entrepreneurship activities

Social Entrepreneurship

Agricultural Entrepreneurship

Women Entrepreneurship

Small Scale Entrepreneurship

Qualities of an Entrepreneur

The qualities of an Entrepreneur are the key value to success. They play the role to guide the person to achieve his/her goal. Some qualities of an Entrepreneur are stated below:

Hard-working

• Without working hard, no entrepreneur can be successful.
• On average, successful entrepreneurs work between 60 to 90 hours per week, which is much higher than 40 hours per week.
• Successful entrepreneurs adapt to the habit of hard work from a very early stage.

Optimistic

• Entrepreneurs should get think negatively or be afraid of adverse situations.
• Being optimistic is about learning from mistakes and failures and finding alternative ways to do things.

Independent

• Successful entrepreneurs like to function at their own will and rules.
• They prefer to be their own master and not work under someone else.

Energetic

• Energy is always high in successful entrepreneurs which makes them extremely proactive.
• They are continuously taking action to try multiple approaches and execute things.

Self-confident

• An entrepreneur should have a strong belief in his/her abilities.
• Entrepreneurs are able to transfer this passion and vision to investors, employees, customers, etc. to sell their idea to every stakeholder.

Perseverant

• A way of thinking that helps to accept failure,
• learn from mistakes
• not give up
• continuously experiment, etc.
• All this is crucial for an entrepreneur.

Functions of an Entrepreneur

1. Entrepreneurial functions

Organization Building and Management

• Organization building is about bringing together different factors of production and allocating these resources to bring down costs and losses.
• All decisions relating to an enterprise are taken by the entrepreneur.
• An entrepreneur builds the organization by taking various steps such as hiring employees, organizing the factors of production, sourcing finance, etc.

Risk-taking

• Risk-taking is about taking responsibility and planning for a loss or mishap that may occur in the future due to unforeseen contingencies
• An entrepreneur plays the function of developing a certain risk-taking appetite and taking calculative risks to reduce adverse consequences.
• Some common risks entrepreneurs take are around return on investment, hiring of new employees, working with vendors, etc.

Innovation

• Entrepreneurs innovate by introducing new concepts, products, services, designs, ideas, etc.
• They may introduce something new and innovative in any branch of economic activity.
• In today’s world, a new business cannot survive and sustain without innovating in some manner.
• An entrepreneur foresees a potentially profitable opportunity and innovates in the effort to exploit it.

2. Promotional functions

Idea Discovery

• The first step towards entrepreneurship is the discovery of a business idea.
• An entrepreneur comes up with a business idea and thinks about ways to implement it.
• It is about seeking opportunities for a specific type of business and finding ways to commercialize it.
• Usually, entrepreneurs work around the process of idea discovery by exploiting natural resources, finding a market need, or calculating the profit potential.

Detailed Investigation

• While coming up with ideas can seem like an easy process, the challenge is to understand if the idea has the potential to turn into a viable business venture.
• For this, an entrepreneur conducts research, investigates and evaluates an idea considering various factors, and estimates the total demand for a new product or service.

Assembling the Requirements

• Some basic business requirements include infrastructure or office space, human resources, key vendors or partners, working capital, etc.
• In a manufacturing or product-based business, some requirements are selecting the factory site, sourcing plant, and machinery, hiring staff, finding the right suppliers, etc.
• No matter what is the type of the business, an entrepreneur has to work towards assembling and organizing all the requirements once he/she is sure about the practicality and profitability of the proposition.
• Once this function is performed, the project is set to start smoothly.

Financing

• Raising capital for a business is one of the core functions that entrepreneurs perform themselves, not just at the initial stage of the business, but even to grow and scale the business.
• First, the requirements of finances are estimated.
• Next, the sources from which capital will come are determined.
• This includes calculating the long-term and short-term financial requirements and considering the debt-equity ratio.

3. Managerial functions

Planning

• An entrepreneur documents a business idea in the form of a business plan, to detail each element of the business such as product or service description, operations, marketing, finance, accounting, growth plan, etc.
• A business plan serves as a guide to determine the business objectives and the course of action.
• It helps to detail the “what, when, how, and who” of doing every specific task.

Organizing

• Organizing in the managerial context refers to setting specific and attainable goals and objectives to be achieved by different departments and by each employee.
• It is about arranging, directing, guiding, coordinating, and controlling the key business activities

Directing

• Directing is about initiating planned action and ensuring that each employee is performing effectively.
• This also includes doing continuous performance reviews and organizing tasks according to plans.

Staffing

• Staffing refers to different sub-processes around human resource management, such as manpower planning, recruitment, selection, placement, training, transfer, salary, promotion, payroll, appraisal, etc.
• The objective of staffing is to fill a particular position with the right employee at the right time.

Leadership

• Leadership is more of a skill than a function for an entrepreneur as he or she has to lead, guide and supervise people who work for the business.
• It is the process by which an entrepreneur directs, guides and influences the work of others in choosing and attaining specified goals by mediating between the individual and organization in such a manner that both get maximum satisfaction.

Communication

• An entrepreneur has to communicate every single day, in the form of writing, responding, drafting emails, verbal instruction, discussion, etc.
• Entrepreneurs spend 75% to 90% of their working time communicating with others.
• It refers to the exchange of ideas, feelings, emotions, knowledge, and information between two or more persons.
• Nothing happens in management until effective communication takes place.

Supervision

• After issuing instructions, the entrepreneur has to see that the given instructions are carried out.
• Supervision refers to the job of overseeing subordinates at work to ensure the maximum utilization of resources, to get the required and directed work done, to correct the subordinates whenever they go wrong, and ensure each function of the business runs smoothly.

Motivation

• Along with guiding employees, an entrepreneur also plays the role of motivating them and encouraging positive behavior and culture within the organization.
• Motivating employees is about creating an urge in them to exhibit the desired behavior and positive attitude towards work.
• Employees with high motivation automatically do other things along with it to perform successfully, such as being productive, flexible, competitive, comprehensive, efficient, etc.

Co-ordination

• Coordination between different departments of the business helps to ensure that work happens in a timely manner.
• Activities of all employees must be channelized towards goal achievement.
• An entrepreneur has to set certain targets, measures, goals, etc.
• With different departments to ensure all are coordinating and working effectively internally as well.

Controlling

• Sometimes controlling is necessary for the entrepreneur to set company rules and policies.
• The controlling function helps the entrepreneur to set performance standards, measure and compare productivity and performance, identify variations, take corrective action, etc.

Negotiation

• An entrepreneur negotiates terms and conditions for many parts of the business such as payment terms and timelines, salaries of employees, vendor quotations, etc.

4. Commercial Functions

Production and Operations

• Depending on whether it is a service business or product business, an entrepreneur has to perform the function of managing production or operations.
• For a manufacturing business, production-related activities include sourcing raw materials, checking the functioning of machinery, utilizing maximum capacity, meeting order requirements, etc.

Finance and Accounting

• While finance is more focused on raising funds and managing them, accounting helps to record and analyze the financial position of the business.
• Thus, an entrepreneur has to prepare and analyze cash flow statements, income sheets, balance sheets, etc.

Marketing

• Marketing is about moving the product or service from the producer into the hands of the end customer or user.
• It involves promotion, advertising, distribution, customer service, etc
• An entrepreneur has to perform this function to make people aware of the offerings of the business and makes sales.

Human Resource Management

• Human Resource Management (HRM) refers to the recruitment, employment, selection, training, development, and compensation of the employees within an organization.
• An entrepreneur performs this function as no business can function without people.

Role of Entrepreneurs

Innovator’s Role

Entrepreneurs innovate by bringing unique and new products and services into the market. Innovation in the industry results in higher production efficiency which has led to an increase in employment and income levels.

Agent’s role

Entrepreneurs are perceived as ‘Agents of Change’. They identify the opportunities, establish enterprises, and build up industries which in turn lead to the overall development of the economy.

Coordinating role

An entrepreneur has to coordinate the various factors for production. It involves the selection of the best possible combination of factors.

Risk assumption role

The fruit of bearing risks can be profit, which leads to wealth generation for the overall economy. Entrepreneurs retain some amount of the profits earned and put it back into the business. Therefore, by assuming risk entrepreneurs contribute to the economy.

Capital formation role

Entrepreneurs enable the formation of capital by mobilizing idle savings for the purpose of carrying on the business. This mobilization of capital leads to the development of assets, trade activities, an increase in capital availability, and economic development.

Imitating role

In developing nations, entrepreneurs usually imitate or adopt the innovations done by the entrepreneurs of the developed nations. These innovations are adapted according to the local needs and conditions and work towards overcoming entrepreneurial challenges.

Employment Generation role

The establishment of business enterprises leads to the generation of employment opportunities as various human resource professionals are needed to run the business effectively. Hence, entrepreneurship solves the problem of unemployment, which is a major problem in economic development.

Status transformation role

Entrepreneurs generate employment, income, and wealth which improves the overall standard of living in society. Improved standard of living leads to economic development as it reduces the disparity in income.

Balancing role

Entrepreneurship is encouraged with small and micro enterprises and small-scale industries as well. This encourages regional development and removes development imbalances in the economy.

Importance of Entrepreneurs

Free market evolution

• Entrepreneurs are important in a free market because they help the market respond to changing prices and consumer preferences.
• Entrepreneurs bring change in technology, trends, and markets.
• For example, with an increase in digital services, entrepreneurs have created companies that offer many home delivery services such as groceries, restaurant food, clothes, accessories, etc.

Efficiency improvements

• A successful entrepreneur tends to adapt to an established business and increase their own efficiency.
• They innovate with current systems and introduce new technologies which can significantly create advancement in the industry.
• Hence, during any major changes in the economy, entrepreneurs adapt and do not have to go out of business.

New markets

• Entrepreneurs can often ‘redefine the rules’ of an established industry.
• They do this by creating new markets for existing products and slightly innovating in small ways to suit the needs of a new target market.

New values

• Sometimes, entrepreneurs choose ethics over profit and offer a more ethical product to the world, and are transparent about it.
• For example, Jaipur Rugs has multiple artisans who work towards making rugs that are sold around the world.
• However, Jaipur rugs are very transparent about their artisan community and they ensure that artisans are given a fair share of profit.

Myths of Entrepreneurship

There are many myths about the characteristics and traits of entrepreneurs. With the set of activities, they perform, entrepreneurs start to be described in a certain way. However, these descriptions and conclusions are made after the entrepreneur is already successful. It might not apply when a person starts from scratch to move towards entrepreneurship. It might not apply universally to all entrepreneurs. Let us look at some of these myths in detail.

Entrepreneurs are born a certain way

• This is a myth and research had established that almost anyone can be an entrepreneur with the right skills, drive, and passion.
• There is no set defined way to point towards personality types of entrepreneurs.
• Entrepreneurship is a learned skill, not a natural-born ability.

Great ideas are what make entrepreneurs

• This is a myth as there is no real or commercial value of just an idea.
• Entrepreneurs do not necessarily reinvent the wheel.
• Many times, they take existing ideas to make a business out of them.

Entrepreneurs have to take a lot of risks

• Entrepreneurs definitely have to bear some risks, they do not necessarily put themselves in high-risk situations.
• Entrepreneurs take calculated risks and weigh risk versus reward.

Businesses either skyrocket or fail

• This is a fact.
• Although select not many start-ups skyrocket and get every one of the media consideration, embracing a win big or bust point of view toward entrepreneurship is simple.
• While many ventures become famous and many fall flat, a ton of businesses are run with patience and strategy with an emphasis on self-sustenance and steady development.

A lot of money is required to start any business

• This is a myth.
• The key to entrepreneurship is to start with resources available and grow slowly and steadily.
• It is not necessary that one should fear or deter from entrepreneurship due to a lack of financial resources.

One must know everything before starting a business

• Real entrepreneurs thrive on being in a constant state of learning.
• Being new and even somewhat naïve can be an asset in today’s rapidly changing world.
• That’s because succeeding at entrepreneurship requires energy, innovation, and the ability to push yourself outside your comfort zone.

Entrepreneurship as a Career

Being an entrepreneur is an implausible profession to numerous youngsters. A few people are not even aware that having their very own business or independent work can be a choice. Other people who are aware, never at any point think about it in their whole lifetime. This is on the grounds of an imperfect perception that we were destined to work for big companies.

Nurtures development of entrepreneurial skills and capabilities

• Entrepreneurship cultivates unique skills and encourages outside-the-box thinking.
• Entrepreneurship education provides with the skills and knowledge to come up with business ideas and develop ventures.
• It is broadly about learning to practice core business areas such as marketing, sales, finance, accounting, management, etc., and developing skills such as effective communication, creative problem solving, adaptability, etc.

Enables the application of an entrepreneurial mindset

• The advantage of working towards developing an entrepreneurial mindset and learning entrepreneurial skills over more traditional subjects is that they are not necessarily only relevant to becoming an entrepreneur.
• In fact, having an entrepreneurial mindset and a wide range of business-relevant skills acquired through studying entrepreneurship would make one an ideal candidate in most fields.

Develops the ability to handle failure and ambiguity

• A critical part of learning in the entrepreneurial process is to learn from failure.
• Going through this process helps to learn from mistakes, take failure positively and stay motivated to work towards achieving the goal.
• Similarly, just like life is uncertain, business is full of ambiguity.
• While actually finding solutions to deal with ambiguity, one develops certain traits such as risk management, perseverance, and persistence.

Enhances critical thinking and problem-solving ability

• The ability to think critically and solve problems is essential to succeed in the world of business.
• Learning entrepreneurship exposes one to numerous opportunities that force one to think critically, analyze all alternatives and consider possible solutions.

Provides early exposure to the real world

• Working professionally in the real world requires one to collaborate, think creatively, and demonstrate proficiency.
• Entrepreneurship practice at an early stage in one’s career encourages activities such as going out and interacting with customers, creating tangible concepts and ideas, preparing detailed documents, working with investors, etc.
• This gives great exposure and knowledge about the trends and needs of the real world.

Inspires to think about one’s career differently

• Many students do not even consider that they can try to work on business ideas, take up entrepreneurial projects, take the initiative to impact society, etc.
• They tend to develop a certain trail of thought about their career – from graduating high school to college to looking for a job
• If entrepreneurship exposure is given at the first point when one starts thinking about building a career, it can help them to think of different career options and explore what they are actually passionate about.

Leads to create a difference in society

• Entrepreneurs not only economically impact society but they also work on identifying the real needs and problems of people and solving them.
• Learning entrepreneurship encourages one to find problems that need to be solved, invent a solution for them, and ultimately, make the world a better place.

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