Diploma in Business Assignment PDF

Higher National Certificate/Diploma in Business
Assignment Brief
Student name/ ID Number Surya D Talukdaar
Unit Number and Title 9 Entrepreneurship and Small Business Management
Academic Year 2018-19
Unit Tutor Ms. Meher Patel
Assignment title Entrepreneurial Ventures & Exploration of the
Entrepreneurial Mindset
Issue Date 04/04/19
Submission Date 10/07/19
IV Name & Date Ms. Shreya Kanjariya – 15/07/19
Submission Format:
Task 1( LO1, LO2,LO3 & LO4)
The submission in the form of an individual written report to small businesses. You are required
to make use of headings, paragraphs, subsections and illustrations as appropriate and all work
must be supported with research and referenced using the Harvard referencing system. Please
also provide a bibliography using the Harvard referencing system. The recommended word limit
is 6,500–7,000 words, although you will not be penalized for exceeding the total word limit.
Unit Learning Outcomes:

LO1 Explore and illustrate the range of venture types that might be considered entrepreneurial.
LO2 Assess the impact of small businesses on the economy.
LO3 Determine and assess the key aspects of an entrepreneurial mindset.
LO4 Examine the different environments that foster or hinder entrepreneurship.
Assignment Brief and Guidance:
Task 1 (LO1 & LO2)
You currently work for a consultancy firm that provides advice and market intelligence to small
businesses and entrepreneurs. You have been asked to choose one example of each type of
entrepreneurship which should be a local business. As a part of creating report, you have been
tasked for following:
1. Examine different types of entrepreneurial ventures and how they are related to the
typology of entrepreneurship.
2. Explore the similarities and differences between entrepreneurial ventures.
3. Assess and interpret relevant data and statistics to illustrate how micro and small
businesses impact on the economy.
4. Explain the importance of small businesses and business start-ups to the growth of the
social economy.
5. Determine the characteristics traits and skills of successful entrepreneurs that
differentiate them from other business managers.
6. Assess how aspects of the entrepreneurial personally reflect entrepreneurial motivation
and Shared mindset.
7. Examine, using relevant examples, how background and experience can hinder or foster
entrepreneurship.
Grading Criteria

Learning
Outcome
Pass Merit Distinction
LO1 Explore and
illustrate the
range of venture
types that might
be considered
entrepreneurial.
P1 Examine different types of
entrepreneurial ventures and
explain how they relate to the
typology of entrepreneurship.
P2 Explore the similarities and
differences between
entrepreneurial ventures.
M1 Investigate a
diverse range of
entrepreneurial
ventures to
demonstrate an
understanding of
entrepreneurship in
both the public and
corporate sector.
D1 Critically examine
the scope,
development and
growth of
entrepreneurial
ventures.
LO2 Assess the
impact of small
businesses on the
economy.
P3 Interpret and assess
relevant data and statistics to
illustrate how micro and small
businesses impact on the
economy.
P4 Explain the importance of
small businesses and business
start-ups to the growth of the
social economy.
M2 Evaluate the
differences that small,
medium and large
businesses make to the
economy, applying
relevant data and
statistics.
D2 Critically examine
how small businesses
have an impact on
different levels of the
economy in a local,
regional, national and
international context.
LO3 Determine
and assess the
key aspects of an
entrepreneurial
mindset.
P5 Determine the
characteristics traits and skills
of successful entrepreneurs
that differentiate them from
other business managers.
P6 Assess how aspects of the
entrepreneurial personally
reflect entrepreneurial
motivation and mindset.
M3 Explore and
examine different lines
of argument relating to
entrepreneurial
characteristics.
D3 Analyze the
characteristics traits,
skills and motivational
drivers of successful
entrepreneurs,
supported by specific
examples.
LO4 Examine the
different
environments
that foster or
hinder
entrepreneurship.
P7 Examine, using relevant
examples, how background
and experience can hinder or
foster entrepreneurship.
M4 Analyze the link
between
entrepreneurial
characteristics and the
influence of personal
background and
experience to specific
successful
entrepreneurs.
D4 Critically evaluate
how background and
experience influences
entrepreneurs, both
positively and
negatively, by
comparing and
contrasting examples.
STUDENT ASSESSMENT SUBMISSION AND DECLARATION

When submitting evidence for assessment, each student must sign a declaration confirming that the work is
their own.
Student name: Surya D Talukdaar Assessor name: Ms. Meher Patel
Issue date:
4th April 2019
Submission date:
10th July 2019
Submitted on:
10th July 2019
Programme:
Pearson BTEC HNC in Business level 4 - RQF
Unit:
Unit 9: Entrepreneurship and Small Business Management
Assignment number and title:
Entrepreneurial Ventures & Exploration of the Entrepreneurial Mindset
Plagiarism
Plagiarism is a particular form of cheating. Plagiarism must be avoided at all costs and students who break
the rules, however innocently, may be penalised. It is your responsibility to ensure that you understand
correct referencing practices. As a university level student, you are expected to use appropriate references
throughout and keep carefully detailed notes of all your sources of materialsfor material you have used in
your work, including any material downloaded from the Internet.Please consult the relevant unit lecturer or
your course tutor if you need any further advice.
Student Declaration
Student declaration
I certify that the assignment submission is entirely my own work and I fully understand the
consequences of plagiarism. I understand that making a false declaration is a form of
malpractice.
Student signature: Date:

Index
Sr. No. Contents Page No.
1 Executive Summary 2
2 Introduction 3
3 Examine different types of entrepreneurial ventures
and explain how they relate to the typology of
entrepreneurship.
4
4 Explore the similarities and differences between
entrepreneurial ventures.
12
5 Interpret and assess relevant data and statistics to
illustrate how micro and small businesses impact on
the economy.
16
6 Explain the importance of small businesses and
business start-ups to the growth of the social
economy.
23
7 Determine the characteristics traits and skills of
successful entrepreneurs that differentiate them from
other business managers.
25
8 Assess how aspects of the entrepreneurial personally
reflect entrepreneurial motivation and mind-set.
33
9 Examine, using relevant examples, how background
and experience can hinder or foster
entrepreneurship.
35
10 Authors conclusion 38
11 Bibliography 39
1

Executive summary
This report starts with examining the different types of entrepreneurships in the
business sector and what kind of business typologies each of them are related to.
The report then gives a tabular representation of the differences and similarities that
each of the businesses have.
Further on, the report assesses and interprets the entrepreneurships’ relevant data and
their statistics to illustrate how micro and small businesses impact on the economy.
Explanation of the importance of small businesses and business start-ups that are
supported for the growth of the social economy is given in the report.
Characteristics traits and skills of successful entrepreneurs that differentiate them
from other business managers are determined and applied in situational context in the
report.
This report will help in assessing the aspects of the entrepreneurial personally and its
reflection on entrepreneurial motivation and shared mind-set.
The report then finally analyses the impact (hinder or foster) that the background and
experience of the entrepreneurship will have on the company.
2

Introduction
Shree Mahila Griha Udyog Lijjat Papad, more commonly known as Lijjat, is a
women’s cooperative that is in the manufacturing of multiple fast-moving consumer
goods.
It currently has operations all over India and does a significant amount of export of
their products.
The products it sells include Papad, detergent, soaps, cottage leather, incense sticks,
matches, etc.
It has employed 43000 employees, majority of which is made up of women. As of the
last recorded profit, it had earned over 109 million dollars.
3

Entrepreneurship
Definition: Entrepreneurship is the willingness and ability to bear uncertain risks and
to make decisions in a business. Entrepreneurs are the people who bear this risk of
losing their money, if the business fails (Grant, 2008).
Enterprise is the driving force, provided by risk-taking individuals, that combines the
other factors of production into a unit capable of producing goods and services. It
provides a managing, decision-making and coordinating role.
Public Entrepreneurship
Typology
A public enterprise is an enterprise or business that the public, often the government,
controls. This is not limited to central government; locally owned or controlled
enterprises, such as municipal water and sewer companies, are also public
enterprises. The government has the final say on the directors of the enterprise and
major policy decisions. Any profits are either invested back into the company, or they
go to the government, (Bizfluent.com, 2010).
Artificial Limbs Manufacturing Corporation of India (hereafter referred to as
ALIMCO) is a public entrepreneurship whose objective states that it not only wants
to develop the ability and availability of artificial limbs but they would also help and
promote other manufacturers that have the same set of objectives to manufacture
prosthetic limbs. This emphasises on the fact that this entrepreneurship was
established, on 1976, for the purpose of uplifting the entire industry of artificial limbs
manufacturing.
ALIMCO is an inrepreneurship type as the objectives also mentions carrying on the
business of manufacturers, buyers, sellers, importers, exporters, dealers in and of
Artificial Limbs and accessories and constituents thereof and all other things which
can be or may conveniently be used for the manufacture of or in connection with such
articles, things as aforesaid. This diversification in one organisation itself clarifies the
typology of intrapreneurship of seeking to improve the existence of an existing
organisation.
It also a technical entrepreneurship as the artificial intelligence and simulation
testing of the prosthetic limbs which makes ALIMCO a product-oriented market. The
innovative qualities and development of in-house technology upgradation are some of
the reasons why this government undertaking is in this category.
4

Scope, Development & Growth
The study, designing & development, of limbs with neuro-prosthetics, ALIMCO is
very beneficial for have started in the 21st century. The technological reach today has
made this entrepreneurship understand that as a public and technical enterprise, this is
the future in the orthopaedic industry. The accelerated growth in the artificial
intelligence industry along with the use of machine learning, the earlier metal-like
limbs are now being replaced by synthetic and computerised parts that nearly
replicate a real limb.
Due to the fact that there are many firms that are in the latter stage of the prosthetic
industry and need the base limbs and other prosthetics to start their upgradation,
ALIMCO provides the manufactured prosthetics to these firms and so has a new
market for its products.
As ALIMCO has government backing, it is able to invest into import of basic but
fundamental machinery to manufacture industry standard cutting edge base products
which matches international standards as well leading to two benefits: first, the
domestic firms do not need to import base limbs due to any possible difference in
quality of ALIMCO and other foreign products; second, ALIMCO is able to export
its products to countries that cannot pay premium to the international market leaders
in the prosthetics industry due to the oligopoly market condition, and because
ALIMCO comparatively keeps the prices of the prosthetics low, many developing
countries purchase the base limbs from ALIMCO.
ALIMCO has produced multiple types of products for various types of handicap such
as orthopaedic, visual, hearing and mobility. There are currently limited number of
products in each category and the current development plan is to produce more
number of current products at a large scale so that they can enjoy economies of scale
and pass on the benefits of the amount saved to the customers.
Apart from that, ALIMCO is also trying to introduce a bill into the parliament (with
the help of the current ministry) which would allow the tax deduction of 100%, of the
amount spent in the research and development) spread out over a tenure of 5 years
after the market launch of a new product for every firm in the industry. This would
encourage the demand for ALIMCO’s base prosthetics as well as give ALIMCO an
opportunity to develop more types of prosthetics under each current category.
Currently, ALIMCO produces products that directly as well as indirectly support the
lifestyle of the differently abled as mentioned above. ALIMCO aims to diversify the
range from the current spectrum into a wider category such as cosmetic prosthetics
including ocular prosthetics – artificial eyes – that uses technology which changes
digital photogenic signals to be converted into brainwaves – neuro electric signals –
enabling the user to see in reality.
5

Private entrepreneurship:
Typology
A private enterprise is one that private citizens own or control. This can be anything
from sole ownership to large publicly traded corporations. Rather than the
government, the owners choose the board of directors of a private enterprise, and
profits distributed among the owners or shareholders. The government has no direct
say in the running of the enterprise, (Bizfluent.com, 2010).
In this case, J.K. Shah Classes is a private entrepreneurship as it is India’s biggest
chartered accounting classes and runs its operation in many states. The
entrepreneurial aspect of this is that, the Institute of Chartered Accountancy of India
(ICAI), is only responsible for the examination and certification of the candidates. It
provides students with books that are outdated (such as tax and law) by the time it
reaches the students. It does not have any coaching of its own. Therefore, seeing this
scenario, the founder of J.K. Shah Classes conducted a need-gap analysis and then
started a tuition chain that teaches all the subjects of all levels in CA. After 34 years
of running it is the most renowned coaching and has seen no severe competion due to
its takeover policy of any upcoming CA coaching class.
This categorises J.K. Shah Classes into the typology of owner-managers. Owner
managers are usually the ones that start and operate the business by themselves. The
classes which was started by J.K. Shah, was also managed by him and the day to day
operations of weekly timetable and teacher allocation was set all by himself. Today
he has his son, Ashish Shah doing the work of operations all over India and has kept
the admin hierarchy very centralised and short.
Another typology is first generation entrepreneurs. Mr. J.K. Shah is the person
who had started this professional coaching classes by providing all the subject’s
tuitions under one brand. Earlier, students had to go to individual coaches to learn
respective subjects.
6

Scope, Development & Growth
As a coaching class, J.K. Shah Classes faces little to no competition due to its
strategy of making upcoming classes’ owners (whose students have been able to clear
any stage of the examination in the first attempt), sign a non-compete for a certain
fee. Therefore currently the classes has a scope of expansion into multiple states and
cities without the fear of competition.
The brand image of J.K. Shah Classes is recognised throughout the country and
therefore no newly formed branch would be existing that would not absorb the fixed
cost if not providing with profits.
Apart from that, the competition to teach at J.K. Shah is also significant as the
teachers of J.K. Shah carry more social status than many practicing CAs.
J.K. Shah Classes currently provides coaching for Chartered Accountancy (CA) and
Company Secretariat (CS). The synergy between the two is limited but the reason for
this venture is because after being able to teach CAs, the syllabus of CS is quite
limited and is a reduced version of CA in all aspects. Therefore, the current
development plan of J.K. Shah Classes is to start coaching for specialised Tax
consultants which includes Tax return preparers (TRPS) as well as Goods and
Service Tax practitioners (GSTP). This would be a complete synergy based
development to their ongoing enterprise.
India chartered accountancy is recognised as one of the most difficult courses in all
over the accounting fraternity. The current benefits that it has is that the Institute of
Chartered Accountancy of India (ICAI) has signed Memorandum of Understanding
(MOU) with countries like England, Australia and UAE where Indian CAs can
prepare returns and pretty much do all of the work that a CA can do except sign the
final audit reports and financial statements. However, some countries provide the
opportunity to foreign CAs that if they pass the examination of Association of
Chartered Certified Accountants (ACCA), then they can even sign the income
statements and audit reports and become a practicing CA in their country.
J.K. Shah Classes has planned for opening its branches the countries mentioned
above to start the coaching of ICAI with the motive of accumulating mostly Non-
resident Indian, who want to study CA but practice in the foreign country. This would
be an extremely beneficial growth strategy for J.K. Shah Classes as in the future they
can think of developing the coaching to teach ACCA syllabus of the final exam to
those candidates.
7

Corporate entrepreneurship:
Typology
Corporate Entrepreneurship is a process used to develop new businesses, products,
services or processes inside of an existing organization to create value and generate
new revenue growth through entrepreneurial thought and action, (Corporate
Entrepreneurs, 2013).
Mahindra and Mahindra, which was ranked 18th on Fortune India 500, is one of the
largest automobile manufacturer in India and had started its operations in the year
1948 by realising a business opportunity into sport and multi utility vehicles. This
company falls under corporate entrepreneurship not only because of its sheer size of
operations and turnover but because every time Mahindra and Mahindra grows, it
finds opportunities to expand not only its vehicle portfolio by entering different types
of vehicles but also to expand into foreign countries and build area-specific line of
vehicles for that country.
Mahindra & Mahindra has the typology of serial entrepreneurship. This is because as
the name suggests, a serial entrepreneur is an entrepreneur who continuously comes
up with new ideas and starts new businesses. Mahindra group always looks for
industries, geographical boundaries and product diversification to expand to, as
opposed to the traditional entrepreneurship of executing a single idea and stick to that
throughout its life cycle.
Apart from that, it is also an industrial entrepreneurship because the company when
opts for inorganic growth, and takes over a company in a different industry, it opens
up a production plant of its own. As an industrial entrepreneurship, Mahindra has the
ability to transform economic resources and technology into a profitable venture.
A different classification can also be super-growth entrepreneurship. A basic
measure of this type of an entrepreneurship is profitability. Taking into consideration
the takeover of South-Korean based automobile manufacturer – SsangYong – by
Mahindra group, the company has had booked its profits for the first time in 9 years
and since has booked only net profits.
8

Scope, Development & Growth
Mahindra is a conglomerate with its operations growing day by day and has divided
its business into subdivisions. Mahindra & Mahindra currently has businesses units
that are more or less in a synergy with each other, in terms of operations, production
process, outsourcing, revenue generating, etc. The scope Mahindra has is that
recently the government has allowed 100% FDI in the union budget of India. This
means that the international corporates would be more likely to tie-up with reputed
Indian corporates – one of which is Mahindra. The conglomerate has planned to
capture this scope as it would be beneficial for more inorganic growth within the
country.
Development plan of Mahindra and Mahindra includes introduction of a dedicated
cell for innovation which would provide enterprise mobility, cloud computing,
content services commonly delivered across multiple devices, data Analytics,
machine-to-machine communication and the Internet of things. Mahindra is
planning to spend into its research and development department and the first
breakthrough in any of the mentioned innovative projects would be selected for
furtherance.
Mahindra group believes very much on the method of ‘growth by acquisition’. The
company had acquired many companies in the past from different industries with no
direct synergy, such as Satyam, Kinetic Motors, etc. Mahindra has since then, grown
into these respective industries to become one of the few market leaders in these
industries. This was the plan with the takeover of REVA Electric Car Company as
they wanted to enter into the electric car manufacturing industry to grown into new
market as well as to make sure that the current automobile division undergoes
changes to suit the future changes better.
9

Social entrepreneurship:
Social entrepreneurs can be those individuals who are associated with non-profit and
non-government organizations that raise funds through community events and
activities, (Managementstudyguide.com, 2011).
Shri Mahila Griha Udyog Lijjat Papad (hereafter referred to as Lijjat) is a social
entrepreneurship started with the motive of the upliftment of the women in the
society by creating employment opportunities for them. It is a cooperative that trades
in FMCG and the reason this organisation falls under social entrepreneurship is that
Lijjat is a unique social entrepreneurial venture that is organized as a worker’s
cooperative, where ownership is restricted to its working women members. Unlike
many women’s cooperatives in India, Lijjat was founded without government support
and has received limited government finances or involvement. Its sister members are
typically unskilled women hailing from poor to lower-middle–class backgrounds.
The typology of this organisation is of intrapreneurship. An intrapreneur is an
employee who is tasked with developing an innovative ideas or project within a
company. The intrapreneur may not face the outsized risks or reap the outsized
rewards of an entrepreneur. However, the intrapreneur has access to the resources and
capabilities of an established company. Lijjat had started with only the production of
the FMCG of ‘papad’ with an invested capital of 80 inr (1959 currency) to takeover a
loss-making papad manufacturing company. The inrepreneurship part of the now
cooperative first made the firm into a profit making one and then expanded the
business by venturing into multi-product FMCG by manufacturing ‘khakra’,
‘masala’, etc.
Most importantly, it’s also a women entrepreneurship. From the technical aspect, the
government of India considers a company as women entrepreneurship if the
enterprises is owned and controlled by a woman having more than 50% of the
shareholding and has given more than 50% of the employment generated, by the
business, to women. So in the eyes of law, Lijjat is a women entrepreneurship.
However it is also a women entrepreneurship because Lijjat was an initiative taken by
confident and creative women who were capable of achieving self-economic
independence in a collaboration, and had generated revenue as well as employment
with the sole purpose of benefiting the women in the society overall.
10

Scope, Development & Growth:
Many foreign officials and visitors had shown keen interest in this social enterprise
and want to start a similar venture in their country to uplift the women of their
country and address the same issues of poverty and women empowerment. This has
helped Lijjat to understand that their scope of operations is not limited to Indian
political boundaries but extends beyond. Currently their production plants are in India
and are producing to cater to the domestic market as well as, by way of exporting, to
foreign countries.
The management of Lijjat developed from a group of neighbours who wanted to
work for the upliftment of their family livelihood, to a well-established and
recognised society (legal status) that empowers women. They have multiple plants
with various processes and has their own branches that looks after the distribution
channels of the supply of Lijjat’s products. The number of employees that it has in
the organisation is more than 43000. This explains the extent to which the
organisation has grown since its inception.
The management may develop a plan to open its manufacturing plants outside India
and capture uncharted markets. They already have licenced and registered their
trademark in select foreign countries which would help them to go through with this
expansion plan. They have already increased their exports year over year and have
recorded a profit of 800 crores in 2018. They can easily grow if they choose to retain
back a significant amount of profit into their organisation for any sort of expansion
plan. The entire project can be self-funded.
11

The author has further explored the similarities and differences between entrepreneurial ventures as follows:-
Similarities
Factors Public Private Social Corporate
Reward The primary motive of
a public
entrepreneurship is
social upliftment and
therefore the
perspective of reward is
the successful
achievement of the
reason the
entrepreneurship was
formed.
The reward aspect is
crucial at this
entrepreneurship for the
survival of the
organisation. This is
because there is less to
no financial backup
usually to be able to
absorb losses regular
intervals.
Social entrepreneurship
runs for a purpose and
therefore believes that
the reward is the
attainment of the
motive the venture was
started for. Monetary
incentive is a part of it
but not significantly
important compared to
other ventures.
The corporate
entrepreneurship has a
significant value for
reward but the reward
is subjective year after
year as the venture is
way past its survival
stage and therefore
might term reward as
something other than
monetary compensation
too.
Accountability Accountability is
required in public
enterprise as the funds
that are injected are tax
paid money. The
government keeps
record of every
transaction to avoid any
mishandling or misuse
of the public funds.
ALIMCO publishes its
financial reports in its
In private enterprise,
the accountability is
important because
otherwise there would
be no financial
planning prospect for
the companies.
J.K. Shah Classes
maintains
accountability every
operational decision
and every transaction
Social
entrepreneurships must
keep accountability of
what they are doing in
terms of the donations
that they receive. This
is for two factors: The
first is that the
individual (person or
corporate) donating to
the social enterprise
might be eligible for a
tax deduction; and
A corporate enterprise
is required to maintain
accountability so that it
knows its financial
scope and extent;
whether or not it needs
more working capital;
etc.
A different reason for
maintaining
accountability is that
corporate enterprises
are more likely to fall
12

website without fail
transparency with the
public.
so that it can start its
tax-planning before the
deadlines to file the
tax-returns.
second, there might be
a bad publicity if the
enterprise can’t account
for its spending.
under the ‘random
audit and scrutiny’ list
in any year as deemed
fit by the government.
Structure The structure is
important in a public
enterprise because it
helps in knowing the
authority its employees
have within the
organisation as well as
on other government
Public-Sector
Undertakings (PSUs).
In a private enterprise,
a structure is required
so that the HR can draft
the recruitment
requirements and fill in
the vacancies for the
tasks that are needed to
be done.
Social
entrepreneurships
consider each member
equal but even they
have a structure for the
purpose of delegation
and breakdown of roles
and responsibilities.
A corporate enterprise
needs a structure the
most because without
that, a company with
hundreds and thousands
of employees would
not be able to function
at all where nobody
knows the hierarchy
and flow of command.
Investment The capital infused in a
public entrepreneurship
is very huge because it
has to be able to serve
to masses for the
overall public welfare.
The investment at
private enterprise is
required because it is
run with the motive of
going concern and so
would require capital to
keep a smooth cash
flow.
Social enterprise
always seeks out
investors in form of
aid, direct investment,
etc. to fund the
expansion of the
venture to be able to
serve a larger segment
of people and address
more of the problems.
Corporate
entrepreneurships
require massive amount
of investment as they
start ventures as big as
the public enterprise
but without the backing
of government.
Therefore it is crucial
that financial
institutions prioritise
the corporates without
which they wouldn’t be
able to grow with just
their retained earnings.
13

Differences
Factors Public Private Social Corporate
Purpose The purpose of the public
enterprise is overall
social welfare at an
affordable price with
sufficient supply
availability.
Private
entrepreneurships are
established for the
purpose of making an
idea a reality and earing
pure profits out of it.
To serve the society by
addressing community
problems of a particular
segment in terms of
social, cultural and
environmental
hindrances.
To become huge
conglomerates with
operations in multiple
industries and become
market leader in a few of
them, if not all.
Decision-making In the public enterprise
the decision is taken by
the appropriate ministers
and director generals
which determines the
future of the
organisation.
In a private
entrepreneurship, the
decision making
authority lies
completely in the hand
of the sole-trader, or the
partners, and other
venture starters to
whom the organisation
belongs.
Depending upon the
type of social enterprise,
the decision making
authority is vested upon
by the founders. There
are many social
entrepreneurships where
all the members have
equal rights, for e.g.
worker associations.
In a corporate the board of
directors are the personnel
who have the decision
making authority of their
organisation. Due to the
concept of divorce
between ownership and
control, sometimes the
owner, if they are not in
the panel of the board of
directors, has no say in the
operations of the business.
Risk The risk is lower
compared to other non-
government aided
entrepreneurships.
The competition is high
with same sized
The risks are very high
due to the high amount
of initial investment and
the pressure to repay
that investment by
making high turnover.
The risk is lower as
these entrepreneurships
also mostly are eligible
for government aid
along with public
support due to their
The risk is medium as
corporate
entrepreneurships have a
larger scope and reach due
to its brand value and
often sell in large
14

organisation with the
same ability and
availability of funding.
purpose of operation. volumes. This is because
the risk of survival stage
and initial growth is
achieved long ago and
therefore is
Employee
number
The number of
employees depends on
structure and size of the
venture.
The number of a private
entrepreneurship is
relatively lower
compared to public and
corporate.
Usually less number of
employees if the
entrepreneurship
doesn’t have any kind
of operating source of
revenue. Other kind of
social entrepreneurships
might have member
based organisation
where the number can
be greater.
Employees can be more
than 1000. There are
instances where the
corporate is capital-
intensive and in those
businesses the number of
employees is significantly
lower but still higher than
many SMEs.
15

The author has assessed the impact of small businesses on the economy as
follows:-
In India, the Fiscal Commission has defined small-scale industry as, one which is
operated mainly with hired labour of usually 5-25 people. The Small-Scale Industries
Board has defined it as a unit employing less than 50 employees if using power and
less than 100 employees if not using power and with a capital asset not exceeding 5
lakhs.
Small scale industries are the backbone of the Indian industrial structure. Small-scale
industries (SSIs) constitute an important and crucial segment of each sector. Defining
small scale industry is a difficult task because the definition and relevance of small-
scale industry varies from country to country and from one time to another in the
same country depending upon the pattern and stage of development, government
policy and administrative set up of the particular industry.
Every country has its own set of parameters in defining small-scale sector. Generally,
small-scale sector is defined in terms of investment ceilings on the original value of
the capital employed in terms of assets owned. However, not long ago, it was defined
on the basis of number of employees the company had.
The Micro, Small & Medium Enterprises (MSMEs) have been contributing
significantly to the expansion of entrepreneurial endeavours through business
innovations. The MSMEs are widening their domain across sectors of the economy,
producing diverse range of products and services to meet demands of domestic as
well as global markets. As per the data available with Central Statistics Office (CSO),
Ministry of Statistics & Programme Implementation, the contribution of MSME
Sector in country’s Gross Value Added (GVA) and Gross Domestic Product (GDP),
at current prices for the last five years (as on 2017) is as below:
16

The contribution of Manufacturing MSMEs in the country’s total Manufacturing
GVO4 (Gross Value of Output) at current prices has also remained consistent at
about 33%, i.e. one-third during the last five years (as on 2017).
Application
Mahindra & Mahindra
Relevant data
Mahindra is now concentrating more on its automobile subsidiary, more specifically
the electric vehicle division. Due to the size of Mahindra & Mahindra, the impact of
electric vehicles in India has been significant. As the cost of per-barrel of gasoline is
at a perpetual increasing scale, in the Indian market, it is crucial that a corporate
enterprise introduced this product. This not only helped the people in terms of saving
cost, but the environmental atmosphere too. The consolidated benefits are:-
 The electric vehicle saves recurring cost compared to its petrol and diesel
counterparts.
 The amount of carbon dioxide and carbon monoxide emission is drastically
reduced due to the electric vehicles’ division such as Mahindra REVA.
 The overall import reduction of gasoline from gulf countries and US which is
helping the economy in its balance of payments, the cost of which would have
to be borne by the citizens who do not use or own any gasoline based vehicle.
17

Statistics
“Goods & Service Tax on Electric Vehicles has been reduced from 12 percent to 5%.
Availability of tax deduction of upto 1.5 lakhs on the interest paid on loan taken to
purchase Electric Vehicles.”
The Union Budget 2019 that was announced by the finance minister of India, gives a
huge benefit to electric vehicles in pursuit of promoting the use of electric vehicle
and indirectly forcing people to shift from petrol or diesel run vehicles.
A Mahindra electric vehicle ranges from 3 to 12 lakhs depending upon passenger or
commercial car. The tax benefit right now would mean the interest would completely
be absorbed by the tax deduction from income tax; over and above the previous
statement, as per the tax treatment of motor vehicle under the Profits/Gains from
Business/Profession, the eligible depreciation is around 40% in the first year. This
means that the cost of Lithium Ion battery pack would be included in the total cost of
Mahindra’s electric vehicle for the 40% treatment and would actually reimburse more
than the entire cost of the battery in the form of depreciation.
18

Lijjat Papad
Lijjat is in the FMCG industry with a diverse product range.
Relevant data
As women have started working in organisations such as Lijjat Papad, the
dependencies on their other counterparts have reduced.
To further elaborate, because women have an opportunity to work at Lijjat Papad, the
burden of fulfilling necessities of the family is shared between house members and
they can start increasing their living standards.
By increasing the standard of living, they would be able to afford better quality
education for their children. This would result in a more skilled labour force in the
future with the possibility of higher per-capita income.
Apart from that, families which were barely or sometimes unable to afford basic
necessities for living, would have ability to buy sufficient necessities and would have
access to better healthcare (such as medicines, water that is not contaminated, etc)
leading to a decrease in infant mortality and increase life expectancy too. In an
overall, they would be able to contribute to the economic growth as well as economic
development.
Statistics
“Lijjat papad has 60% market share in organised sector of papad and thus is the
market leader”.
“Lijjat retains only 2% of the entire turnover as means to pay for the organisation’s
expenditure”.
The statistical data given above has effects on the economy as follows:-
 As it is the market leader in India in terms of papad distribution, it is freely
able to concentrate on distributing its products to foreign countries such as
Netherlands, Singapore, US, Thailand, Europe and other countries, along with
international recognition and interest on Lijjat as an enterprise so that countries
like Iran, Israel, the UK, and others can endorse this type of a venture in their
countries.
 The living standard of all the 43000 employees (and their families) have
improved significantly because even though it is a registered as a society, Lijjat
operates as a not-for-profit organisation and therefore distributes almost its
entire revenue amongst the members throughout the year, 3 times to be precise,
in the form of cash or gold.
19

Difference in
Impact
Small & Medium Enterprise Large Enterprise
Innovation SME entrepreneurships tend to start with more
like a renovation than in innovation. This affects
the entire industry as now to be competitive it
has to change its traditional methods. Lijjat did
the same thing as they went on to sell a
household food which was earlier made in every
Indian house. The idea that it took was to
employ low cost labours and manufacture
papad and sell it to the Indian families at a very
low selling price. This saved a lot of time for the
housewives in India as they didn’t have to go
through
The innovation that is carried out by a large
enterprise affects the entire industry as well as other
industries that are linked directly or indirectly with it.
The scale of the impact the innovation would do is
much higher and significantly larger compared to a
small or a medium enterprise. The introduction of
REVA – electric car – has put the electric car
industry into a fast-track and the blockchain effect is
that the government, competitors, international
investor, etc., all have started to positively uplift this
industry. This has also affected the diesel and petrol
engine based cars as prices have gone down industry
wide.
Employment The small and medium scale enterprise can
employ a bunch of people which, not
individually, but when combined, would reduce
the unemployment rate gradually but
significantly. The also gives chance to
candidates that have lost the competitive battles
in corporate hiring and are ready to settle for a
lesser paying job. At Lijjat, the same concept
has been realised as currently they have given
employment to more than 43000 workers.
A large enterprise always has a large impact in the
labour force of a country. If a large enterprise wishes
to lay off any of the layers in its organisational
structure, within one go, hundreds and thousands of
people will be unemployed and the unemployment
rate would just shoot up. Mahindra, when it acquired
20

21

Lijjat Papad, being a small business, has greatly impacted the economy at
different levels:-
Local
At local level, Lijjat has been able to generate employment for women in such a scale
that the need of their families to transit from village to city has reduced in order to
earn more. Working at Lijjat, the family is able to sustain livelihood in a decent
manner. The entrepreneurship organises workshops and training sessions in the
community fair for its employees so that a preventive healthcare systems can be put
in place and practical life skills can be learned such as cooking, typing, knitting,
sewing, etc.
The negative impact that Lijjat had unwillingly made on the local society was that,
because it had started an enterprise that doesn’t require any professional skills, many
women who were housewives, were forced by their in-laws to work at the Lijjat
Papad’s outlets and earn revenue for the household. Along with that, many women
who were working professionally at other private or public organisations were forced
to quit their job as Lijjat was more ‘womanly’ work and they would also not need to
leave the house more often as they can make the papads at home. Apart from that,
even though Lijjat offers aid to any member who wants to educate their children,
many orthodox communities were against female education and apart from that they
pressurised their children to help the women workers in their home to make products
so that they can earn more.
Regional
Apart from that the running of Lijjat Papad has indirectly impacted the other regional
firms in different industries as the utilisation of local resources is required in terms of
logistics, raw materials, etc. Upliftment of other backward classes and families living
below the poverty line have been significantly helped due to the functioning of Lijjat.
At an economic standpoint, the tax base has increased due to the revenue generating
capacity of Lijjat and so the state tax helps the economic development of multiple
regions in various states. CSR activities include scholarships for the children of the
members so that they can get standard education, supporting natural disaster stricken
locations, etc.
Lijjat Papad was started with a capital of Rs. 80 in 1956 and had started generating
tremendous amount of revenue right from the initial years of operations. The effect it
had on the regional market was that majority of the lenders were now looking for
similar ventures where they can invest minuscule amount of money and get back
interest and principle which are much higher than normal. This resulted in other long-
term capital intensive and industry changing innovative ideas, not being able to start
because of lack of funding sources.
22

National
As per the statistical data, Lijjat Papad holds more than 60% of the market share in
organised sector of papad industry, when Goods & Service Tax was introduced, the
overall taxation on majority of the products (including papad) had reduced down.
The benefit to the entire nation of Lijjat’s existence is that it is a society and not a
profit making company; this means that the benefits gained due to this shift from
service tax to GST, was passed on to the customers by reducing the selling price. This
move had forced other competitors to pass on the benefit too. This was only possible
because Lijjat is the market leader.
The negative impact had started when there was an introduction in the taxable
products under the value added tax regime on detergent products. Before the large
scale operations and revenue generation of Lijjat, detergent products had escaped the
tax radar of the government. Due to the growth rate of Lijjat, all the products that
helped it in earning revenue were audited by the government and therefore because of
Lijjat, the entire country had to incur tax burden, which some manufacturers passed
on to the customer while others absorbed it in their revenues. Along with that, the
impact of
International
In a country like India, where the balance of payment is adverse, the contribution of
small and medium enterprises, including Lijjat Papad’s, to the national export helps
tremendously in generating foreign exchange revenue and levelling out the adverse
balance of payment situation. Lijjat has also impacted international associations, to
such extent that during its growth stage, UNICEF and Lijjat had conducted a seminar
in Mumbai – Childcare & Mother Welfare – to improve children’s rights. As Lijjat
has copyrighted its trademarks and patents in countries like USA and lucrative
markets like EU, the prospect of international expansion would definitely help
bringing in foreign exchange and help the economy to grow. Apart from that Lijjat
also has made a social statement that women can work and become an important part
of a society while being a small entrepreneurship startup.
23

The author has explained the importance of small businesses and business start-
ups to the growth of the social economy as follows:-
Social Economy
Social economy is a virtual economy that co-exists alongside in the same real
economy with other types of entrepreneurship. It is an economy where private-funded
entrepreneurships are operating in a market where the market runs on price
mechanism, however the motive of these entrepreneurships is to attain a general
economic welfare and social benefit. Co-operatives, employee-owned companies,
mutual societies, social integration enterprises, etc. are some of the types of small
enterprises that are run in a social economy.
The importance of the existence of a social economy is that social enterprises
innovate and bring about new business ideas that directly have a positive impact on
the society in the short as well as the long run.
They are the venture that reaches out to that part of the society which is neither
catered by the private not being looked after by the public to a significant extent.
They have the ability to use the methods and tactics of the traditional private
enterprises and scale it down to serve the local and rural development.
Another importance of the existence of the social enterprises are that they all are,
theoretically at least, built with a proper and ethical agenda. It is people-centric where
addressing societal demands is the primary task instead of getting interest on capital.
Also, these are inclusive in nature which means that because they do not have to
compete in a cut-throat business environment for their survival, they can support and
hire whoever wants to be a part of this entrepreneurship.
In order to maintain the growth of social economy, the start-up businesses have high
influence in different countries. These often are built up with innovative ideas that
can meet the requirements of the people as compared to those of the other businesses.
Along with that, there have been cases when start-up businesses have captured the
market quickly and have managed to generate significant revenue in a relatively short
timeframe. In this process, those businesses need to provide high amount of business
tax that can be helpful of the growth of a country.
24

Application
When Lijjat Papad was a start-up, it was doing the same activities wherein they hired
women who otherwise were solely dependent on their father or husband, to work and
make their own living.
After a few consecutive profit making years, the then small business, Lijjat had
started an initiative to help the poor by donating food, provide direct financial aid to
natural disaster stricken places and later actively supervised the rehabilitation of those
places.
Lijjat gives support to the socially excluded people by volunteering, providing them
with job opportunities, etc. This is useful as, in order to operate a venture startup,
they hire people, leading to a reduction in the unemployment rate in the country.
Startups that do not have the initial funds to hire highly skilled employees, are often
giving chances to people who are ambitious and hardworking but have not scored
well or don’t necessarily have a degree from a reputed college.
Another importance of the existence of small businesses is that customers get to
choose form many suppliers which keeps the prices low comparatively to had it been
a monopoly market with no small businesses. Along with this because of the
existence of such small businesses, large corporations tend to stay competitive and
so put efforts on quality, development, customer service, etc.
They retain back their profits and reinvest it in the local economy in the form of
services such as education, startup fund for local entrepreneurs for local
businesses, etc. Numerous startups are associated with various types of CSR
activities pertaining to environmental, social, and economic problems so that they can
uplift their brand value. In this procedure, those businesses provide education to the
people in rural areas or people with poor financial background. Those people can use
that education in future to get work that is also helpful in economic growth. These
impact the overall literacy rate and help increasing the standard of living of the
entire country as a whole.
25

The author has determined the characteristic traits and skills of a successful
entrepreneur that differentiate them from other business managers as follows:-
Traits usually refer to somebody’s natural abilities. Entrepreneurial traits might
include:-
 Goal-oriented: Setting goals and working single minded to achieve them.
Having a set executable plan and knowing exactly what they need to do in
order to achieve their goals.
 Committed: Extremely focused and following the work plan religiously.
Prioritising tasks that require immediate attending rather than procrastinating
the decision making time which could adversely affect the overall business.
 Resilient: Not letting any setbacks that occur before, during or after the
execution of the plan, affect them and deflect them from their goal. The
motivation to continue again.
 Pro-active: Taking the initiative to get the things done and not wait for ‘things
to happen themselves’ and not phased out easily by uncertainly of the tasks and
how they could have been or might have been done.
 Positive attitude: Generally have an optimistic approach to any barriers and
setbacks and have the confidence to solve them despite their severity.
 Risk-takers: An innate belief in their own ability to succeed and pull the entire
venture to a momentum which will then get past the stage of survival. However
keeps in mind that any losses would finally be borne by them.
Skills are the qualities that a person can develop through training, experience or
practice. The entrepreneurial skills that can be explored include:-
 Listening skills: As nobody can be good at everything, an entrepreneur needs
to take advice from people who do possess the skills that the entrepreneur
lacks.
 Communication skills: These include verbal and non-verbal depending on the
situation’s requirement. This is essential is an entrepreneur is needed to work
effectively with other people and need to communicate their vision with his/her
colleagues and also in some cases potential customers.
 Leadership skills: This includes the ability to lead inspire and influence other
people to share the same priorities as the entrepreneur and their entrepreneurial
venture.
26

Application
The ownership of Lijjat had started with 7 women who happened to be neighbours
with the same dream of helping their livelihood by the help of their knowledge of
cooking. With a borrowed sum of Rs. 80 in the year of 1956, they started their
venture and the annual turnover as on 2018 has reached Rs. 800 crores.
The traits with these women entrepreneurs are:-
Positive attitude: The women had decided that they would never resort to free help
or any kind of charity or donation to sustain their venture. The commitment contained
the statement that this no-help policy would be in action even if the venture in future
makes losses.
This trait sometimes makes the women entrepreneurs too optimistic which leads to
some unrealistic actions. This means that in a free-market economy, where
interdependency is a necessity, the no-help policy has made Lijjat lose any expansion
opportunities and has led to some product failures because they did not take
consultancy or do any market research for that industry. The examples of these are
when they had opened a branch in Malad it had failed miserably due to lack of brand
awareness. Another one was when they launched products at a fast scale without
studying the market such as, cottage leather, incense sticks and matches.
Being resilient: The women had faced two major setbacks; the first when they had
started diversifying into different industries and had infused capital in the
manufacturing and marketing of those products only to find out that many of that
product expansion plan had failed to launch properly in the market for example, the
incense sticks industry and the cottage leather industry.
The second one was when in 1985 when one of their branches was taken over by the
husband of the supervisor in that branch. The 7 women had fought very hard to
enforce stay order on that branch and were able to control the situation along with
that they got their branch back.
The downside of resiliency is that there are many instances where being resilient
would mean that the controlling owners of Lijjat papad become obsessed and
determined towards unattainable goals instead of adjusting them to more achievable
ones. Another way it can affect the organisation is that due to the owners’ personality
of being resilient, the other member workers of Lijjat might end up putting up with
demoralising method of production which would later on affect their efficiency. This
is the result of too much resiliency.
The managers in the same situations would have found that one of their optimal
strategies would definitely include the donation and charity plan if available but
would not be able to take into account the factor of all women empowered venture
27

and the personalised corporate culture of this at that day and age would have been
more impactful than taking any external aid.
The skills that these women entrepreneurs had was:-
Listening skill: The first strategy of Lijjat was to manufacture two types of Papad;
one of which would be a little inferior in quality so that they can make it affordable
for the people who had less income proportion. The society member that lent them
the initial capital however had advised them to keep the quality of the Papads
standardised so that their brand name is not associated and positioned in the mid of
customers as an inferior goods manufacturer. The same thing happened when he gave
them the knowledge of the advantages of maintaining proper books of accounts and
how this venture should be operated as an enterprise.
They also listen to the women workers in their branches in matters such as regional
rates, production problems, quality checks, etc. For e.g. if the workers find a more
efficient method of machine maintenance, where the production doesn’t halt
completely at an entire branch (resulting in production loss); but instead is used a
pilot mode of maintenance of shutting down individual process of production for
maintenance of the machines while the other processes continue.
Leadership skill: As years passed by, there were more and more women who were
applying to join Lijjat and be a part of the organisation. The growth and the fact that
it was a female upliftment focused venture had given a lot of women courage to start
working independently and therefore, this led to the venture having more than 300
members by the third year of Lijjat.
Communication skill: There are instances when the communication skills of the
entrepreneurial females were tested; there was an incident when the market had a
parallel supply of fake Lijjat papad branded products. The venture owners then took
it to their official website and dedicated a webpage on addressing this scam along
with help to its customers on how to identify their original Lijjat branding and
differentiate it with the fake one. This was a crucial communication from their part as
this had created awareness to the markets where they export their product along with
the rural parts of India where people were naïve enough to buy without checking the
authenticity of the product that they used to buy.
These entrepreneurs are different from managers in these cases because they develop
extra ordinary skills apart from the day-to-day operations and functions. Managers
would just stick to their 4 staple skills which would not be that helpful in scenarios
where outside opinion, a clear share of information between stakeholders and to bring
about a change is required.
28

The skills possessed by these women entrepreneurs however also have some
drawbacks such as:-
Listening can be harmful as the entrepreneurs need to devote time to listen and so the
plan of action is delayed and so is the execution time. Apart from that there is
something called as too-much of information which leads to too many alternatives.
When there are numerous alternative plans of action, it becomes a tedious and
extremely time consuming to find out the best possible option for the
entrepreneurship. Apart from that, there might be instances where listening can
actually be harmful to the organisation. For e.g. the person who used to be a
consultant for the women who had started up the entrepreneurship, if he wouldn’t
have been knowledgeable enough himself, then wrong and misleading information
would have been grasped by Lijjat and if they would have executed their amended
plan of action due to that, then the entrepreneurship might have shut down long ago.
Skills such as communication can create problems such as unqualified assumption.
The average literacy rate at Lijjat is very low as well as they workers are people who
have a very confined life. When the in-house magazine, Lijjat Patrika, is distributed,
it contains information regarding all the branches spread across the entire country.
So, the readers may make unqualified assumptions regarding the performance on one
branch without first considering factors such as local laws, city population, cost of
material, number and availability of workers, etc. This may lead to unwanted rumours
within the organisation. Along with that the magazine is printed in English, Hindi,
Marathi and Gujrati. The problem that can occur is that there may be important
message or speeches whose meaning and effect may be lost in translation resulting in
a communication failure.
The leadership skills can be very problematic in an organisation such as Lijjat where
there are multiple founding partners. This skill can give rise to discrepancy as to who
has the main authority and control over the operations of the business. Apart from
that, being a leader means whenever there is a problematic situation which affects
Lijjat, the member-workers look up to the top panel and if the entrepreneurs flinch or
show indecisiveness even for a moment, there can be a chain reaction towards
workers being panicked and creating chaos in the organisation and therefore creating
further problem for the women entrepreneurs.
29

The current owner of Mahindra & Mahindra Ltd. is Anand Mahindra and is a
Harvard Architecture graduate Magna cum Laude (High Honors) and has done his
MBA also from Harvard.
The traits that Mr. Mahindra possess are:-
Risk taker: During the 2009 Satyam Computer Services Ltd. fiasco, Anand
Mahindra saw an opportunity of inorganic growth by taking over Satyam, whose
shares had become penny-stock but had a relatively good customer base and
international outreach. At that time normal stakeholders were unsure that how
Satyam’s tainted brand image would affect Mahindra, but Anand knew that the
reputation and integrity that Mahindra had would supersede the negative goodwill
that Satyam would bring together with it.
As Mahindra & Mahindra is a large conglomerate corporate entrepreneurship, risk
taking should be kept minimal as there are consequences for it such as, Mr. Mahindra
is a well-established entrepreneur, however if he keeps on taking such risk and
possibly fails in the future, the impact might have to be suffered by his other
subsidiary business units too in the form of fall in share prices, fall in management
confidence to capture opportunities with even minor risks. The goodwill of the entire
corporate would be affected in this case.
Being pro-active: Mr. Mahindra, in 1994, restructured the organisation completely
and dissected the company into 6 strategic business units: Automotive, Farm
Equipment, Trade and Finance, Infrastructure development, Information Technology
and Telecom and Automotive component sectors. This initiative helped the
organisation diversify their risk and therefore was able to smoothly take the end of
Licence-Raj and not be completely impacted by the 1991 economic reform of
Liberalisation, Privatisation and Globalisation.
Although sometimes, it is important to stand down and wait for a competitor to take
lead and then make a reactive plan of action. This is because there might be costs that
can be saved by being reactive and yet be able to earn profits. For e.g. when
carburettors in the car engine were launched, the customers first had to be made
aware of the existence of the product and had to be explained the benefits of
carburettors to the lifespan of the engine as well as the environment. The first
automobile manufacturer who wanted to capture this USP had to spend a lot in the
advertising campaign so that people are aware of the benefits of this new technology.
As soon as that happened all other car manufacturers started to advertise only the
inclusion of carburettors in their engines but without spending on the explanation of
them. This type of reactive nature saves a lot of money in the long run.
30

In both the scenarios the manager would have been reactive to the market changes
instead of being pro-active and would have lost the opportunity to sustain the
business dynamics of the company. They would have just tried to find more efficient
ways to do the same thing that they do in the industry but wouldn’t have thought of
such an endeavour to be taken up which was done by Mr. Mahindra.
The skills that Mr. Mahinda has honed over the years are:-
Listening Skills: Mr. Mahindra, unlike most of the Indian family run conglomerates,
used to have a de-centralised planning for all the subsidiary business unit that the
group holds. This was so that they do not make the same mistake as ITT
(International Telephone and Telegraph) by just going on a takeover spree and
forcing the parent company’s corporate policy of all of them regardless of synergy.
Having said that, Mahindra and Mahindra was lacking strategic discipline. The will
of not turning into ITT made the company into a group that just existed due to
historic reasons. This is when Mr. Mahindra took the advice of his former Mahindra
Gujrat Tractors Ltd., and had changed his perspective on centralised planning for its
subsidiaries. Mr. Mahindra then signed off on the plan to introduce Office of
Strategic Management (OSM) which would give corporate guidance and planning to
all of the subsidiaries that asked for it from the parent company. This was a huge
success as the subsidiaries did not feel a drastic change in the corporate culture of
decentralisation but just had gotten a high end consultant in the form of (OSM).
Communication skills: During the disinvestment of Ford industries when Jaguar and
Land rover were being sold by Ford (along with Aston Martin and Volvo but Indians
were not interested in them), Mahindra & Mahindra and Tata Motors were the ones
who were bidding on those two and even though M&M was leading the initial phase
of the bidding, Mr. Mahindra called off the bid, which led to Tata Motors buying the
brand without competition. The reason for this action by Mr. Mahindra was because
he had communicated with a business friend of his at Ford who warned him about
how the chance of loss in this huge brand can sink down the entire Mahindra Group
of companies. This tip was in fact so helpful that it helped Mahindra instantly as
when Tata Motors acquired Jaguar-Land Rover, the economic steep downfall led to
Tata Motors incurring huge losses which were only absorbed by Tata because of its
deep-pockets, whereas if M&M would have owned this brand, it would have wiped
their existence completely.
31

Leadership skills: During the late 90s, Mahindra and Mahindra were struggling in
the share market and needed a product that would revive the company and restart the
growth of Mahindra group. They had initiated a plan called ‘Project Scorpio’ under
the integrated design and manufacturing project, but after an employee had made a
graphic rendering of a car that was dicey in the blueprints to begin with, Mr.
Mahindra had decided to execute the production and launch of the car – Scorpio –
even though every board member along with some financial analyst were against it.
The reason: the cost of the project was 600 crore rupees. It was an undertaking that
would cost the career of every employee in the organisation, had the product failed.
Mr. Mahindra still used his leadership skills and convinced the entire board to go
through with this project and as of now, it has sold more than 580000 units of Scorpio
cumulatively.
A manager at these instances would have just stuck to the plan of decentralised
decision making process and progressing with the bidding and acquisition, not having
a slightest clue about what devastating impact it would leave on the future of the
company. Anand Mahindra used his ability and skills as an entrepreneur to widen his
perspective and field of information to take informed decisions; something a manager
would not consider on the first hand.
In a corporate enterprise such as Mahindra & Mahindra, Mr. Mahindra’s skills may
sometimes become a barrier in the furtherance of business due to the following
reasons:-
Due to the size of the entrepreneurship, Mr. Mahindra had segregated the
conglomerate into strategic business unit as mentioned earlier. This means that he has
a different board and panel of advisors for different SBUs. The problem with
listening to all of these panels is that because he has to listen to the plans and
suggestions for so long, there may be time-critical opportunities that may sometimes
be too late to act upon. Listening to too much information therefore would lead to
delayed execution. This is because when there is communication from one SBU, it
not only affect that unit but others too. For example, a venture proposed by the
automobile unit requires a certain amount of investment form the headquarters.
However, the infrastructure development unit also requires a certain amount of
resources allocated to them for their project. Now due to limited resources available,
it either has to allocate the resources proportionately or else compare both the plans
and decide on the most profitable one. This leads to a significant amount of wastage
of time.
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The other skill of communication can also be disastrous in in organisation such as
this. Considering the size of Mahindra & Mahindra, the volume of content of
information that needs to be accessed and scanned through to get the desired
information would be reasons for the decreasing efficiency amongst the employees.
Another problem is that due to the tall hierarchy of Mahindra, if Mr. Mahindra
wishes to know an information about the lower level staff and response, he would
have to wait a long time as the message would take a long time to reach the receiver
and the feedback would take the equal amount of time to reach Mr. Mahindra leading
to a wastage in actionable time. One more disadvantage is that, it is possible that
company sensitive information might be leaked or figured out by competitors based
upon the amount of communication the company would be doing in the external
corporate network.
The problem with leadership skill is that the entire organisation looks up to Mr.
Mahindra for guidance and loses its ability to solve problems by taking initiative and
therefore getting a laid-back attitude. This can be very problematic for the enterprise
as Mr. Mahindra would have to give solutions to many cases which could have been
easily solved by the lower level management had they tried to solve it on their own.
From other perspective, there are some leaders who do not take into account the
opinions of their subordinates. Having the leadership skill may sometime make a
person self-centred which would drive away employees with remarkable potential.
Conclusion
To conclude it is not mandatory to have the above mentioned skills and traits,
however, it does become the differentiating factor between successful entrepreneurs
and ordinary visionaries and managers. The traits and skills are the reason why there
are so many new startup ventures are lasing the survival stage into any dominated
industry.
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The author has assessed how aspects of the entrepreneurial personality reflect
entrepreneurial motivation and mind-set as follows:-
Motivation is the reason why employees want to work hard and work effectively for
the business. The main reason people work is to earn money to fulfil their needs and
wants. Some work however is done voluntarily and so doesn’t reap and monetary
benefits out of it. The factor that drives the will power behind an employee’s choice
to work or efficient work relies on the level of motivation that that worker currently
has.
Entrepreneurial mind-set is the way an entrepreneur approaches any situation that
needs their attention. The perspective that they have developed in how to handle their
mistakes and the challenges that they are faced with every day.
Application
Lijjat Papad
There are a few important factors that drastically affect the decision making of the
entrepreneurs at Lijjat. The first is the co-founders of this venture are all pro-women
empowerment and want that women should be given the opportunity to work and
earn their own living and not have to depend on their husband or any other male. This
is so much imprinted into their personalities that a huge offer of turning the whole
organisation’s production plant into a capital-intensive production which would have
brought down the variable average cost of production was declined by them as the
main motive of this venture was self-employment of women.
The founding members of Lijjat Papad, all had one most important entrepreneurial
personality i.e. timely attendance. After the inception of Lijjat, the women always
used to come and leave on time to the business premise. This routine first had just
started as a way to keep the culture of proper attendance in the organisation for the
other members to follow. However this impacted on the commitments and
deliverables as well. Lijjat always fulfils its committed amount of supply to any
customer or the distributors. The time as an important factor, which had started just
as a moral habit, has now helped the determination and diligence of the members to
stand up to the expectations.
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Mahindra and Mahindra
As Mr. Mahindra is an optimistic person, after the 1991 globalisation it was
rumoured that Mahindra’s automotive business unit would be shut down due to the
competition that it would be facing in the then near future from the likes of Ford,
GM, Daewoo, etc. Thereafter, when Ford wanted to launch in India, it was looking
for a partner and so Anand Mahindra quickly capitalised on that and they started a
joint-venture. Ford failed to make an impact with the car that it had launched,
however the workers at Mahindra plant were then trained for making car parts and so
what seemed to be a downturn of M&M of others was completely turned around to
their favour by Mr. Mahindra because of his will to prove the skeptics wrong.
Mr. Mahindra also is an innovative and visionary person. He has always proved in
the industry that whenever Mahindra & Mahindra were in a crisis, he was able to pull
the company out of it. This personal characteristic has sunk into all of the corporates
of Mahindra and the result is that the senior level employees have developed a
perpetual need for improvement in all of their projects and ventures. Within every
few years, Mahindra’s already successful automobiles get ‘facelifts’, stock
modifications, etc.
He also doesn’t like the concept of singular authority and believes in decentralised
management where the subsidiary business units have been given their own authority
to take decisions but in case of any help from the corporate, they have set a
department especially for that. This belief and culture of Mr. Mahindra has spread
throughout the company and the whole organisation including managers and
supervisors use democratic leadership where the employees are given freedom to
complete the work their way but if they require brainstorming or suggestions on their
ideas, the managers give them the analysis of their methods.
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The author has examined, using relevant examples, how background and
experience can hinder or foster entrepreneurship as follows:-
Personal background of the entrepreneur and their experiences have a great impact on
their business and it can hider or foster the survival and/or growth of the
entrepreneurship. The personal background is mostly made up of backing from
family and friends, educational background, self-motivation, financial background,
etc. In many cases, when a person has positive and non-skeptical support from his/her
friends and family, they are motivated to start a venture with confidence.
This support enhances the risk-taking ability and the motivation that will foster the
entrepreneurship. The financial background also influences the risk-taking ability of
an individual and startup a business. Vice-versa, without the support from friends and
family, many entrepreneurs have admitted to have had given up the idea of starting
their venture as they had become demotivated in entrepreneurship. The personal
experience and knowledge of the industries is also likely to have an influence in
entrepreneurship.
Application
J.K.Shah Classes
Mr. J.K. Shah has always been a hard working person with the morals of education
first and timely completion of syllabus which is most important in the field of
chartered accountancy. He himself is a veteran cost-accountancy teacher and
therefore has full-fledged knowledge about the operations in his business and how
much is the capacity of an individual subject teacher. J.K. Shah has currently made
his son the head of operations.
Hinder
As the background suggested, Mr. J.K. Shah is trying to make his classes into a
family-run entrepreneurship. This decision has brought about many problem in the
classes as his son – Ashish Shah – is incompetent in the field of management. He has
a degree of chartered accountancy, company secretary and chartered financial analyst
level III. Despite having all of that the teachers at J.K. shah have shown concerns
over the way the classes has started to operate after the joining of Ashish. The
complaints from the professor panel is that he doesn’t know how much syllabus a
single teacher can cover in the allotted time period. Apart from that, they are also
concerned with the dependency on one single professor for too many branches which
is not a problem for the teachers (yet), but they are concerned in situations like ‘what
if that one professor is unavailable for any emergency reason; what will happen to the
syllabus of the students then?’. Mr. J.K. Shah has highly qualified and competent
alternatives for the post of Chief Operating Officer, but because of his choice of how
the business ownership will change hands, the organisation is suffering a lot.
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Mahindra
As mentioned above, Mr. Mahindra has an MBA degree from Harvard Business School.
This helped him to increase his contacts with many high profile future leaders who
would go into different conglomerates (including the Fortune 500), and therefore have a
network greater than his predecessors. He is the grandson (maternal) of the founder of
Mahindra and Mahindra and therefore was born into a conglomerate family business.
Foster
The situation where Mr. Mahindra had done a case study on ITT and its inorganic
growth failure, he had contemplated the possible solutions to execute inorganic growth
at Mahindra and Mahindra without having to face a downfall and avoid mistakes like
ITT. The simple educational knowledge has helped Mr. Mahindra to diversify his, then
only steel and telecom sector, into 6 major sectors.
Another situation was when, he had bought the majority share in South Korean based
company SsangYong motors. The synergy between Mr. Mahindra having been handled
Mahindra Automotive had led him to believe that he can turn-around the loss making
SsangYong and therefore due to the fact that Mahindra is a well-known brand in India,
the sales of SsangYong made the company earn for the first time in 9 years , net profit.
This was possible because of the extensive business first-hand experience of Mr.
Mahindra in the automobile industry.
Lijjat Papad
The background of the seven entrepreneurs cum co-founders at Lijjat is simple;
women with the experience of household work, using that as their advantage to start a
venture to support their livelihood.
Foster
The first commodity that Lijjat had started to sell was Papad and as their lender
taught them to keep quality consistent they had created an instruction manual that
would be followed by all the branches on how to make the papads just like the
entrepreneurs themselves. Along with that, to ensure that the raw materials which are
given for production of Lijjat’s supply are not being siphoned off for their own use,
the entrepreneurs came up with a quality check which would check the weight of the
papad and match it with the weight range standard set by the founders so that the
number of items along with its quality is not inferior. This was only possible because
the entrepreneurs themselves had an idea on how much raw materials is required by a
batch of papad.
As the founders are all women, they had a better idea about the other commodities
that they can diversify into which are required by any typical Indian Gujrati
household (along with many other casts). Thus, they started producing khakhra,
masala, chapatti, etc. all of which are highly revenue generating products for Lijjat.
37

The author has compared and contrasted the positive and negative impact:-
Mr Mahindra’s background and experience has always been about studying the
organisational behaviour and how orthodox management system gives rise to the
downfall of an entire enterprise. Merging it with the traits and skills of pro-activeness
and listening skill (respectively), Mr. Mahindra was able to make a very positive
impact into the success of this corporate entrepreneurship – Mahindra & Mahindra.
As he had come from a family of entrepreneurial roots, Mr. Mahindra understood that
he needs to continue the culture of diversifying into other industries to keep the
entrepreneurship a conglomerate organisation. Along with that, the education of
MBA degree that he holds from Harvard, has taught him that there should be always
a touch of synergy in takeovers and mergers, if an organisation wants to gain
competitive advantage and develop its already existing core-competencies.
The result: Mahindra & Mahindra has, almost all of the times, executed inorganic
growth that have ventured successfully even if those companies were loss making
and on the verge of insolvency. Furthermore, due to the listening skill, Mr. Mahindra
was able to see the big picture and was persuaded to change his rock solid perception
that centralised management is always the reason for the downfall of a corporate
enterprise.
J.K. Shah Classes:
J.K. Shah is a self-made man and all his experience is first hand, over the years of
hard work, effort and dedication that he has given into the growth of his classes. This
means that he wouldn’t know the perspective or mind-set of a person to whom this
enterprise, which is already functional and well established, would be handed over to.
Other than his experience, his personality is that the morals of education dictate his
classes more than the will of increasing profits and figures. His principle was that
education comes first and organisation’s growth comes after that.
The result: When J.K. Shah handed over the classes to his son – Ashish Shah – he
did not make sure that if his son carries the same principles and vision for the classes
or not. Therefore, an enterprise which was operating on J.K.Shah’s fundamentals,
was completely undergoing a transformation, of which many of the stakeholders –
teachers and students inclusive – were against due to compromise in education and
major focus on increasing operational profits.
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Authors Conclusion
After this report the author was able to understand the different types of
entrepreneurships and the individual typologies that they can be categorised under.
The author is now also able to differentiate amongst different types of
entrepreneurships by their factors of distinguishing.
After completing the report, the author was able to understand the impact and
importance of small business in the economy as a whole as well as at every economic
level.
Along with that, the author has a sense of understanding about the impact that the
entrepreneur’s traits and skill can have in an organisation, the impact their
background and experience can have on the entrepreneurship’s success or hindrance
and finally how all of then collaboratively effect the overall success and growth of
the entrepreneurships.
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