Professional Documents
Culture Documents
Learning Material
for
DOEACC ITES BPO (Customer Care) Training Program
New Module: (additional module to English Skills, Soft Skills and IT Skills)
Developed by: National Institute of Electronics and Information Technology, (NIELIT) Guwahati Department of Information Technology, Ministry of Communications and Information Technology, Govt. of India
Detailed Syllabus: Module: Entrepreneurship Development : (ED) (35 hrs) 1. Principles of Management: (04 hrs) Basics of Management, Planning, Organizing, staffing, directing and Controlling. 2. Management of Computerised Accounts: (20 Hrs) a. Accounting basics, Operating Bank Accounts a.1 Transaction, Journal Entry, Cash Book, Ledger Book, Trial Balance a.2 Profit and loss statement, Balance Sheet a.3 Accounting Principles - Concepts and Conventions a.4 Double Entry System a.5 Rules of Accounting a.6 Mode of Accounting a.7 Financial Statements a.8 Manual Accounting a.9 Bank Reconciliation Statement b. Tally Fundamentals b.1 b.2 b.3 Introduction to Tally Features of Tally Getting Functional with Tally
c. Processing Transactions in Tally c.1 c.2 c.3 c.4 c.5 c.6 c.7 c.8 c.9 Ledgers and Groups Accounting Vouchers Contra Voucher Payment Voucher Receipt Voucher Journal Voucher Sales Invoice Duties and Taxes Recording Transaction of Sample Data
d. Generating and Printing of Accounting Reports/MIS d.1 d.2 d.3 d.4 d.5 d.6 d.7 Financial Reports in Tally Balance Sheet Profit and Loss Account Account Books Group Summary Group Vouchers Generation of Reports.
3. Entrepreneurship Development (06 hrs) Need and objectives, entrepreneurial career planning, object implementation, role of support agencies, incentives, scope and health measures, business development, project report preparation, technical enterprises management, management effective customer services market survey. 4. Marketing Skills (05 hrs) What is selling, pre-sales, the principles of consultative sales, sales call preparation, need assessment, from greeting to product presentation, handling customer concerns buying signals & closing.
1.Principles of Management:
SYLLABUS :
(04 hrs)
DEFINITION OF MANAGEMENT
The term MANAGEMENT has been used in different senses. Sometimes it is used in the sense of managing the group of managerial personnel in an organisation. At other times, management refers to the process of planning, organising, staffing, directing, co-ordinating and controlling. According to Louis Allen Management is what a manager does. According to Mary Parker Follett Management is a art of getting things done through others. According to F.W. Taylor : Management is the art of knowing what you want to do and then seeing that it is done in the best and cheapest way.
OBJECTIVES OF MANAGEMENT
Proper utilisation of resources The main objective of management is to use various resources of the enterprise in almost economic way. The proper use of men, materials, machines and money will help a business to earn sufficient profits to satisfy various interests. Improving performanceManagement should aim at improving the performance of each and every factor of production. The environment should be so congenial that workers are able to give their maximum to the enterprise. Mobilising best talent. The management should try to employ persons in various fields so that better results are possible. The employment of specialists in various fields will be increasing the efficiency of various factors of production. There should be a proper environment which should encourage good persons to join the enterprise. Planning for future. Another important objectives of management is to prepare plans. No management should feel satisfied with todays work if it has not thought of tomorrow. Future plans should take into consideration what is to be done next. Future performance will depend upon present planning .So ,planning for future is essential to help the concern.
FUNCTIONS OF MANAGEMENT
1. PLANNING: Planning is the primary function of management. It is the process of determining future course of action in order to achieve result. Planning involves decision in advance what to be done, where, how and by whom it is to be done. Planning is looking forward .Planning bridges the gap between where we are and where we want to go. Selection of the proper or best alternatives out of various alternatives is the main theme of planning.
IMPORTANCE OF PLANNING
A. Helps in defining objectives. B. Reduces uncertainty. C. Prepares for change. D. Provides competitive strength E. Provides criteria for decision-making. F. Motivates Employees. G. Facilitates Co-operation and cordination. H. Provides a basis of control 2. ORGANIZING: Organizing is the process of intregrating the physical, financial &human
resources &establishing the productive relations between them to accomplish the predetermine goal.Organising is nothing but a structure created to give successful from of all combine effort. Organisation is considered to be a process of creating and maintaining organization is the process of Identification and grouping of activities. Assigning duties. Delegating authorities. Allocating necessary resources. Establishing co-ordination among individual and various departments of an organization.
3. STAFFING: The function involves manning the positions created by organization process. It is concerned with human resources of an organization. The staffing consist of the following:
Manpower planning, i.e assessing manpower requirements in terms of quantity and quality. Recruitment, selection and training: Placement of manpower. Development, promotion, transfer and appraisal.
(4)Directing: Directing is concerned with carrying out the desired plans. It initiates organized and planned action and ensures effective performance by subordinators towards the accomplishment of group activities.
OBJECTIVES OF ACCOUNTING
To record permanently, all business transaction and To show the effect of each transaction and also the combined effect of each transactions for the given period so as to find out the profit the business has earned or loss incurred ,and also to know the correct financial position on a particular date.
IMPORTANCE
The necessity and importance of accounting can be understood by answering the following questions : 1.How much we have earned this year? 2.How much we earned during last year? 3.Is our business improving? 4.How much can do we have? 5.How much money we can won? 6.How much others owe to us?
USERS OF ACCOUNTING
Financial statements will be useful to the following parties : 1.Suppliers 2. Customers 3. Employees 4. Banks 5. Owners. 6.Govt.
TYPES OF ACCOUNTS
There are three types of accounts maintained for transactions: a..Real Accounts b..Personal Accounts C..Nominal Accounts
REAL ACCOUNTS Real Accounts are accounts relating to properties and assets, which are owned by business Concern. Real Accounts include tangible and intangible accounts. For example. Land, Building, Good will, purchases .cash..etc
PERSONAL ACCOUNTS Personal Accounts are accounts which relate to persons. Personal Accounts include the followings..Suppliers, Customers, Lendersetc NOMINAL ACCOUNTS Nominal Accounts are accounts which relate to incomes and expenses and gains and losses of business concern. For example. Salary accounts, dividend acconts,sales etc.
NOMINAL ACCOUNTS Debit all Expenses and Losses Incomes and Gains are Credit
IMPORTANT TERMINOLOGY
What is Transaction?
Accounting transaction formed the accounting records for statutory purpose and audit personal. Accounting Transaction is a confirmed monetory action /decision that impact the entity in monetory terms.
What is journal entry and journal book? The recording of financial data (taken usually from a journal voucher)pertaining to business transactions in a journal such that the debit equals credits. Journal entry Provides an audit trial and means of analyzing the effect of the transactions on an organizations financial position. Journal books are business dairy in which all financial data (taken (usually from a journal voucher) pertaining to business transaction in a journal such that the debits equal to credit. Or Journal book is a business diary in which all-financial data (taken usually from a journal voucher) pertaining to the day to day business transaction of affirm is recorded using double entry book keeping system.
What is Ledger Book? Collection of an entire group of similar accounts in double entry book keeping .Also called book of final entry, a ledger records classified and summarized financial information from journals(the book of first entry)as debits and credit, and shows their current balances.
Date 2005 Dec. 17 Particulars J.R Amount Date 2005 Dec. 17 Particulars J.R Amount
Cash A/C
1,200
Purchases A/C
2,000
It appears that each account in the ledger has two similar sides - left hand side is called debit side (briefly Dr.) and right hand side (briefly Cr.) side. Now a days these two words are not used, because it is obvious that the left hand side is debit side and right hand side is credit side.
What is Trial Balance ? A statement of all debits and credits in a double entry account book, with any disagreement indicating an error. Its a aggregate of all debit and credit balance at the end of an accounting period that shows if the general ledger is in balance (total debits and equal total credits) before making closing entries and provides the basis for making draft financial statement. Example
.
What is Trading account?
The trading account shows the income from sales and the direct costs of making those sales. It includes the balance of stocks at the start and end of the year.
What is Profit and Loss Account? The purpose of the profit and loss account is to:
Show whether a business has made a PROFIT or LOSS over a financial year. Describe how the profit or loss arose e.g. categorizing costs between cost of sales and operating costs.
A profit and loss account starts with the TRADING ACCOUNT and then takes into account all the other expenses associated with the business
Sample:
TRADING AND PROFIT AND LOSS A/C FOR THE PERIOD OF MARCH 2011
Particulars To,Opening Stock To Purchese To All Direct Exp. To Gross Profit(Balancing Fig.)c/d
xxx
xxxxx
xxxxx
To Gross Loss b/d To All Indirect Exp. To, Net Profit (Bal.fig)
The balance sheet must follow the following formula: Assets = Liabilities + Shareholders' Equity It's called a balance sheet because the two sides balance out. This makes sense: a company has to pay for all the things it has (assets) by either borrowing money (liabilities) or getting it from shareholders (shareholders' equity). Each of the three segments of the balance sheet will have many accounts within it that document the value of each. Accounts such as cash, inventory and property are on the asset side of the balance sheet, while on the liability side there are accounts such as accounts payable or long-term debt. The exact accounts on a balance sheet will differ by company and by industry, as there is no one set template that accurately accommodates for the differences between different types of businesses. SAMPLE:
LIABILITIES
AMOUNT(Rs)
AMOUNT(Rs)
Opening balance Net Profit/Loss(Add/Less) Capital Current liabilties Sundry creditors Bills Payable Bank Over Draft Loan
Investment CURRENT ASSETS Sundry debtors Cash in hand Cash at bank Bad debt
xxxxx
Capital: Amount invested by the owners. Profit and Loss: Net Result of income and expense
Accounting Concepts
Business Entity Concept-Business is different from Business Owner Going Concern Concept-Business continues over a period of time Matching Concept-Classification of transactions into income, expense etc and matching them Money Measurement All transactions in terms of money. Historical concept- Cost or market price whichever is less
Accounting Systems
There are various system of accounting for maintaining business records. A. Cash System of Accounting: It is a system in which accounting entries are made only when cash is received or paid. No entry is made when a payment or receipt is merely due. For example, the rent for December 2009 has not been paid till January 10the 2010. Under cash basis, rent expense for the month of December will not be recorded as payment has not been made. Government system of accounting is mostly on the cash system B. Single entry system: This system ignores the two fold aspect of each transaction as considered in double entry system,under .The single entry system does not take into account the double affect of every transaction. The ledger contains only the personal accounts of debtors and creditors, all impersonal accounts such as purchases, sales, wages, carriage, rent etc., are not recorded. Thus the system does not consider the two fold aspect of every transaction. C. Double entry system: As per Double Entry System of book-keeping, all the business transactions recorded in accounts have two aspects - Debit aspect (receiving) and Credit aspect (giving). For example, when a business acquires an asset (receiving) and pays cash (giving) for it. This accounting technique records each transaction as debit and credit, where every debit has a corresponding credit and vice versa. In accounting, only business transactions and events of financial nature are recorded. Only transactions that can be expressed in terms of money are recorded.
Mode of Accounting
Accounting process begins with identifying and recording the transactions in the books of accounts i.e., the first step in the Accounting Process is recording of transactions in the books of accounts. Accounting identifies only those transactions and events which involves money and is sorted based on various source documents. The following are the most common source documents. Cash Memo Invoice or Bill Vouchers Receipt Debit Note Credit Note
VOUCHERS A voucher is a document in support of a business transaction, containing the details of such transaction. RECEIPT When a trader receives cash from a customer against goods sold by him, issues a receipt containing the name of such customer, details of amount received with date INVOICE OR BILL When a trader sells goods to a buyer, he prepares a sales invoice containing the details of name and address of buyer, name of goods, amount and terms of payments and so on. Similarly, when the trader purchases goods on credit receives a Invoice/bill from the supplier of such goods.
as shown by the cash book and that shown by the pass book/bank statement do not match. If the balance shown by the pass book is different from the balance shown by bank column of cash book, the business firm will identify the causes for such difference. It becomes necessary to reconcile them. To reconcile the balances of Cash Book and Pass Book a statement is prepared. This statement is called the Bank Reconciliation Statement. It can be said that : Bank Reconciliation Statement is a statement prepared to reconcile the difference between the balances as per the bank column of the cash book and pass book on any given date.
Reconciling your bank statement is important in the event you have transactions that have not you forget that you wrote a check, you could be operating on the assumption that you have more money than you do. This could lead to denied payments, overdraft fees or other surcharges. Account for Bank Fees
Not only is relying solely on the online statement a bad idea, it's also a bad idea to rely entirely on your records. Some bank accounts have fees or surcharges and if you don't reconcile the statement, you may forget to add them to your records. Detect Errors and Fraud
Always consider human errors are fraud. If you don't reconcile your bank statement, you may miss errors or fraudulent charges. For example, you need to verify there are no double charges for a service, or that no one has compromised your debit card number and used it for fraudulent charges. Overall, it is a big advantage to reconcile your bank statement to assure you and the bank are on the same page.
What is Tally ?
Tally is the de facto Accounting software which is used by millions of small and medium size business houses for their complete accounting solution ,including manufacturing and invoicing. Tally contains numerous features and reports to carter to all sorts of business .so, it is natural that each user will use only a small portion of such rich and diverse functionalities.
Advantages of Tally over Manual System? Posting of transaction can be done without a prior journal entry Balancing of an account is automatic Profit and Loss account and Balance sheet is automatically done. No need to separately close the nominal accounts Clerical errors possibility is absolved.
F6..(Receipt entry) The receipt voucher is for all receipt into cash or bank a/c.The voucher is similar to the payment voucher except that you debit cash or bank accounts and credit the ledger from which you receive.
F7..Journal entry The voucher is an adjustment voucher ,pass a journal voucher when you want to adjust amounts between two ledger accounts,without affecting cash or bank accounts. F8..(Sales entry) The sales voucher is making all credit sales entries .If you make a sale entry through invoice entry,you need not use the sale voucher.Alternatively ,you can enter sale as asale voucher and print it out. F9..(Purches entry) The purches voucher is for making all credit purches entries.It is similar to sale voucher with the exception that you can credit the party and debit the purchase accounts.
F10..(Memorandum entry) To creat memorandum or reserve journal voucher. To creat post dated voucher To creat optional voucher. F11..(Features) To change company features.(at the time of tax related entry basically) F12..(Configure) To change configuration of voucher(application for all companies)
CASH A/C BILLS RECEIVABLE A/C CLOSING STOCK OPENING STOCK CASH A/C BILLS PAYABLE LOAN PAYABLE OVER DRAFT DEPRICIATION A/C DISCOUNT PAID A/C OFFICE RENT SALARY A/C PRINTING AND STATIONARY ELECTRICITY BILL DO INSURANCE PREMIUM TAX AND DUTY OFFICE STUFF WELFARE A/C WAGES TRADING FRIGHT A/C FACTORY RENT CARRIAGE A/C FURNITURE PLANT AND MACHINERY LAND AND BUILDING INVESTMENT BAD DEBTS A/C PURCHES A/C
IF WE HAVE TO CREAT ANY NAME ACCOUNT THAN IT COMES IN SUNDRY DEBTORS(at the time of sales)AND SUNDRY CREDITORS (at the time of purchese).
Accounts Vouchers:
After learned creation of a company, working with accounts group and ledgers we have to learn recording transaction in tally. Transaction is recorded in voucher.
Gate way of tally->Accenting voucher->press respective voucher type..(like f5,f6,f7.)->and put respective transaction. Alter Voucher type Accounts info->Voucher type->Alter To alter an existing voucher type, select this option, choose the voucher type from list that would open in alteration mode to carry out modification the fields are similar to creation except that the option as default does not appear in alteration mode. DISPLAY VOUCHER TYPE Accounts info->Voucher type->Display
Problems:
(1) JOURNAL ENTRIES A) B) C) D) E) F) G) H) I) J) K) L) M) N) O) Jan1..Started business with Rs 10000,paid into bank Rs.5000. Jan2..Bought office furniture for Rs.900 Jan3..Purchase goods from koyal for Rs.4000 Jan5..Sold goods for RS.1700 Jan7..Paid telephone rent for the month of Rs.400 Jan8..Purchase goods for Rs.1000 from Aditya Jan10.paid Rs.160 for advertisement by cheque. Jan 11.Bought one type writer for Rs.750from universal typewriter Co.on credit Jan 12.Sold goods to Paras Rs.2900 Jan16..Sold goods to Omega & Co.for Rs.650 for cash. Jan25.Receive cash from Paras Rs.2850,discount allowed Rs.50 Jan26.Deposited into bank 2500 Jan 27.Issued cheque for Rs.500 in favour of land lord for the rent Jan 30 Paid salary to staff Rs.600 Jan 31 Issued cheque for Rs950 in favour of Aditya in fullsettlement of his a/c
( 2)JOURNAL ENTRIES A) B) C) D) Started business with a capital borrowed from his friend Nidhiram Rs.25000 Bought machinery Rs.6000 Bought Goods for Cash From KalipadaRs.3400 Sold goods for cash to Ram Rs2500
E) F) G) H) I) J) K) L) M)
Purchase goods from Bidya Rs.4500 Cash sales Rs.5100 Deposited cash into bankRs.6000 Paid Bidya in full settelement of her a/c Rs.4350 Sold goods to Gorachand Rs.3600 Paid carriage on sale of goodsRs.200 Gorachand settled his a/c fully by Cheque Rs.3550 Paid rent by chequeRs.400 Paid interest to Nidhiram in 500 in cash
GATE WAY OF TALLY->INVENTIRY INFO->STOCK GROUPS->ENTE THE NAME OF THE STOCK GROUP>ENTER>SELECT THE GROUP FROM THE LIST OF GROUPSIN UNDER>ENTER>
DAL M>OIL
VAT For any tax/vat calculation .press F11.. Company features ! Acconnting features Inventory Features Statutory & taxation (press) ENABLE VALUE ADDED TAX=yes
F11
At the time of purchase we creat two ledger 1> INPUT VAT @ 4%(Mention Percentage) (Under Duties and Taxes Type of Duties and Taxes=VAT VAT/TAX class =Input Vat @4%) 2>PURCHASE VAT@4%(Mention Percentage) (Under Purchase a/c Used in VAT Returns=YES) Also at the time of sale we creat two ledger 1> UTPUT VAT@4%(Mention Percentage) (Under Duties and Taxes Type of Duties and Taxes=VAT VAT/TAX class =Output Vat @4%) 2>SALES VAT@4%(Mention Percentage) Under sales a/c Used in VAT Returns=YES
IN THE VOUCHER PRESS F12 Use Common Ledger A/C For Items Allocation=NO ALLOW SELECTION OF VAT/TAX CLASS DURING ENTRY=Yes.
Use common ledger A/C for item Allocation = No. Allow selection of VAT/Tax class During Entry=YES
EXAMPLE
M/S ASSAM ENTERPRISE DEALS WITH VARIOUS ITEMS.ITS VAT REGISTRATION NO.IS 4130/432412.FOLLOWING ARE THE PURCHASE AND SALE DATA FOR FINANCIAL YEAR 2006-2007 .COMPUTE THE VAT PAYABLE OR REFUNDED BY THE ENTERPRISE.
M/S DATAMISION
COMPAQ COMPUTER M/S AKASH ELECTRONICS LG MONITOR SAMSUNG MONITOR LG KEYBOARD FRONTECH KEYBOARD M/S GUWAHATI STORE LAFARGE CEMENT
250
STAR CEMENT TISCON ROD BISCON ROD M/S SS ASSOCIATION BRITANIA BISCUITS NIZONE BISCUITS JOHA RICE IJONG RICE LIV 52
240 100 QTL 3200 100 QTL 3000 100 20 BOX OF 10 PKT DO 10 QTL 10 QTL 24 BTKS OF 200 ML 10 CARAT 10 CARAT
90 2000 1800 60
GOLD SILVER
9000 500
SALES
HCL COMPUTER
22000
9 PCS
M/S SURESH KUMAR BRITANIA BISCUITS JOHA RICE IJONG RICE LIV 52 10 22 20 65 70 PKT 10 KG 10 KG 20BTLS
STAR CEMENT M/S SHAKEEL AHMED LAFARGE CEMENT TISCON ROD GOLD COMPAQ COMPUTER NIZONE BISCUITS IZONG RICE
PRAKSH SAHA
LG KEY BOARD LG MONITOR SILVER BRITANIA BISC LAFERGE CMNT TISCON ROD
PRADIP JHA
260 3000
50 BAGS 90 QTL
VAT RATE: AGRICULTURE PRODUCT=EXEMPT SILVER/GOLD= 1% CONSTRUCTION MATERIALS=12.5% ELECTRONICS GOODS=40% OTHER ITEMS=4%
PROBLEM ON CENTRAL SALE TAX(CST) Doeacc society Guwahati purchase the following items from SONY SYSTEM LTd,New Delhi SL No ITEM RATE(Rs) QTL 01 Sony Handycam 35000.00 10pcs 02 Sony dvd player 12000.00 15pcs 03 Sony tv 16000.00 15pcs 04 Sony Cd 250.00 10bx of 10 pcs The rate of CST for above item =3% DOEACC society Guwahati sold the following item to Doeacc Kolkata(West Bengal) SL No 01 02 03 04 pcs ITEM Sony Handycam Sony dvd player Sony tv Sony Cd RATE(Rs) 37000 15000 17500 350 QTL 4pcs 3pcs 6pcs 5 bx of 10
The rate of CST for above item =3% Doeacc society Guwahati sold the following item to Doeacc Tezpur SL No 01 02 03 04 ITEM RATE(Rs) Sony Handycam 37000 Sony dvd player 15000 Sony tv 17500 Sony Cd 350 The rate of CST for above item =4% QTL 5pcs 4pcs 7pcs 5 bx of 10 pcs
Process Before ledger Press F11(&Process of as written in VAT Calculation) Enable value Added Tax-YES SET/Alter VAT DetailsYES LEDGER INPUT CST(Under Duties And Taxes) PURCHASE CST(Under Purchase a/c) OUTPUT CST-(Under Duties And Taxes) SALES CST (Sales a/c) TYPE OF DUTY?TAX=CST DEFAULT VAT?TAX CLASS=Inter State sales PERCENTAGE ON CALCULATION(EX..5%,3%,4%)
On Total Sales IN PURCHASE CST-> Used in VAT returns Yes-Inter sate purchases
UNIT2.PROMOTION OF A BUSINESS
A.DEFINITION OF PROMOTION AND PROMOTER B.STAGES OF PROMOTION C.KINDS OF PROMOTERS D.ASPECTS OF PROMOTIONPROCEDURAL ASPECTS..AND ..LEGAL ASPECTS.
Definition
Entrepreneurship can be defined by describing what entrepreneurs do. For example: "Entrepreneurs use personal initiative, and engage in calculated risk-taking, to create new business ventures by raising resources to apply innovative new ideas that solve problems, meet challenges, or satisfy the needs of a clearly defined market."The entrepreneur is often associated with a person who starts his own ;new and small business . Who Are Entrepreneurs? An entrepreneur may be referred to such a single person or agroup who promote a new enterprise by collecting various factors of production and bearing the risk arising out of such venture. Definitions of entrepreneur An entrepreneur is an individual who takes moderate risks and brings innovation. An entrepreneur is a person who has possession of a new enterprise, venture or idea and assumes significant accountability for the inherent risks and the outcome. An entrepreneur is "one who undertakes an enterprise, especially a contractor, acting as intermediately between capital and labour."
3. Skillful person: An entrepreneur has to arrange various factors of production and coordinate the activities of various employees. He should be a skillful person so that he is able to synchronies various activities of the association. 4. Decision maker: An entrepreneur has to take decisions with regard to the establishment of business, its management and co-ordination of various resources. Every activity of the business requires decision making. Entrepreneur is the person who should take decisions by assessing various pros and cons so that no problem arise later on. 5. Plan maker: Planning is one of the important functions of an entrepreneur. He formulates the basic plan of the organization. With the help of planning, other functions like organization, co-coordinating, controlling are undertaken. .
Secondary Functions
1.Diversification of production 2.Expansion programme 3.Employer employee relations 4.Tackling labour problems 5.Co-ordination with outside agencies.
Other functions
1.Management of resources 2.Dealing with public and bureaucracy 3.Acquiring factory unit 4.Engineering 5.New product 6.Parallel opportunities 7. Marketing
Principal function Principal function 1.Discovery of an idea :A person or a group of persons having entrepreneurship and business acumen conceiv idea of venturing an organization .such idea may relate to the formation of new business unit ,diversification of an existing unit ,relationsation of an enterprise etc. 2.Planning :Planning is the first step in the direction of setting up of an enterprise .The entrepreneur prepares a scheme of proposed project in a formal systematic approach. 3.Organising: An entrepreneur co-ordinates, complies ,assembles and supervises land ,labour and capital during the initial stage and at the performance stage, for optimum utilization of recourses. 4. Decision making.: the following: An entrepreneur as a decision maker takes various decision regarding
a. Ascertaining the objective of the enterprise. b.Final decision regarding procurement of machinery,materials,men,money and market. c. Decision regarding appropriate technology, new equipments,etc d. Decision on marketing product. 5.Management: An entrepreneur needs to manage not only the working of the venture but also managing the day to day problems of the enterprise.It includes future expansion, growth and policies of the organization. 6. Innovation: Innovation may occur in any one of the following five forms. Marketing of a new product New technology in production. Creation of new market. Discovery of new and better materials Creation of monopoly or breaking up monopoly.
7. Risk bearing: An entrepreneur undertakes the responsibilities for loss that may arise due to unforeseen contingencies in future. He guarantees interest to creditors, wages to labour and rent to the landlord and the total risk can not be insured. 8. Uncertainty bearings: Entrepreneur bears uncertainty and it refers to the uncertain trends of market ,trade credit etc, which by nature can not be insured.
CLASSIFICATION OF ENTERPRENEURS
1.INNOVATING ENTREPRENEURS These entrepreneurs are generally aggressive in experimentation who exhibit shrewdness in putting attractive possibilities into practice .this type of entrepreneurs new goods ,new devices ,new method of production, open new markets and reorganize the enterprises. 2.IMITATING ENTREPRENEURS These entrepreneurs adopt the methods techniques already successfully executed by innovating entrepreneurs. They are ready to follow whatever useful appears. They are ready to follow whatever useful appears. They are also an important class of entrepreneurs with a difference that they do not innovate the changes themselves, they just imitate the techniques and technologies developed by others. 3.FABIAN ENTREPRENEURS Fabian entrepreneurs are characterized by caution and skepticism in practicing any change. They are neither interested in innovating or imitating others. They go on using traditional methods of production .They are averse to any change and shy and lazy. 4.DRONE ENTREPRENEURS
These entrepreneurs are characterized by rigid and orthodox way of pursuing the things .They are not prepared to follow anything new. They want to continue with the same outmoded techniques even they are running losses.
Qualities of an Entrepreneur
Being an entrepreneur is about more than just starting a business or two, it is about having attitude and the drive to succeed in business. All successful Entrepreneurs have a similar way of thinking and posses several key personal qualities that make them so successful in business. Successful entrepreneurs like the ambitious Richard Branson have an inner drive to succeed and grow their business, rather than having a Harvard Business degree or technical knowledge in a particular field. All successful entrepreneurs have the following qualities: Inner Drive to Succeed Entrepreneurs are driven to succeed and expand their business. They see the bigger picture and are often very ambitious. Entrepreneurs set massive goals for themselves and stay committed to achieving them regardless of the obstacles that get in the way. Strong Belief in themselves Successful entrepreneurs have a healthy opinion of themselves and often have a strong and assertive personality. They are focused and determined to achieve their goals and believe completely in their ability to achieve them. Their self optimism can often been seen by others as flamboyance or arrogance but entrepreneurs are just too focused to spend too much time thinking about un-constructive criticism. Search for New Ideas and Innovation All entrepreneurs have a passionate desire to do things better and to improve their products or service. They are constantly looking for ways to improve. They're creative, innovative and resourceful. Openness to Change If something is not working for them they simply change. Entrepreneurs know the importance of keeping on top of their industry and the only way to being number one is to evolve and change with the times. They're up to date with the latest technology or service techniques and are always ready to change if they see a new opportunity arise. Competitive by Nature Successful entrepreneurs thrive on competition. The only way to reach their goals and live up to their self imposed high standards is to compete with other successful businesses. Highly Motivated and Energetic Entrepreneurs are always on the move, full of energy and highly motivated. They are driven to succeed and have an abundance of self motivation. The high standards and ambition of many entrepreneurs demand that they have to be motivated!
Accepting of Constructive Criticism and Rejection Innovative entrepreneurs are often at the forefront of their industry so they hear the words "it can't be done" quite a bit. They readjust their path if the criticism is constructive and useful to their overall plan, otherwise they will simply disregard the comments as pessimism. Also, the best entrepreneurs know that rejection and obstacles are a part of any leading business and they deal with them appropriately.
UNIT 2
PROMOTION OF A BUSINESS
DEFINITION OF PROMOTION The promotion of every business requires a process to be followed. A number of formalities have to be completed before a unit can come into existence. The length of process and the number of formalities vary with the type of organization and scale of operations. It is easy to start sole trade and partnership concerns but a joint stock company requires lengthy process. According to L.H .Haney, :Promotion may be defined as the process of organistion and planning the finance of a business enterprise under the corporate form DEFINITION OF PROMOTERS A promoters conceives an idea for setting up a particular business at a given place and performs various formalities required for starting a company. A promoter may be an individual ,firm, association of persons or a company. A promoter may be an individual ,firm, association of persons or a company. The persons who assist the promoter in complting various legal formalities are professional people like cunsels, solicitors,Accountants etc.and not promoters. STAGES OF PROMOTION 1.DISCOVERY OF AN IDEA: The first stage in a company promotion is the conception of an idea. The idea may be to exploit a new area of natural resources or more profitable ventures in an existing line of business. He develops an idea with the help of technical experts in that field. 2DETAILED INVESTIGATION: At the second stage various factors relating to that business are studied from a practical point of view. The promoters will estimate total demand for the product. There may be certain concerns already in that type of business and so he will determine his share of demand. After determining the prospective demand for goods he will think of arranging finances for the venture. 3ASSEMBLING THE REQUIREMENTS: After making sure that the proposition is practical and profitable, the promoter proceeds to assemble the requirements. He persuades some more
persons to join hands with him by becoming directors or founder members. If he has invented something new, he should get it registered in his name.He may also acquire some patent rights. 4FINANCING THE PROPOSITION: The promoter decides about the capital structure of the company. The requirements of finances are estimated first.Then the sources from which this money will come are determined .How much share capital will be issued ,the type of sharwe to be issued ,and nature of the loans, whether debentures or borrowings from financial institutions for a longer time period all are finalished.
KINDS OF PROMOTERS The promoters may be following types : 1.Professional Promoters: These are the persons who specialize in promotion of companies. They hand over the companies to share holders when the business starts. 2.Occasional promoters: These promoters take interest in floating some companies. They are not in promotion work on a regular basis but take up the promotion of some company and then go to their earlier profession. For instance, Engineers, lawyers etc.may float some companies. 3.Financial Promoters. Some financial institution or financiers may take up the promotion of a company. They generally take up this work when financial environment is favourable at the time. 4.Managing Agent As a Promoters :In India, managing agents played an importing role in promoting new companies and then got their Managing Agency right. ASPECTS OF PROMOTION: Promotional aspects may be divided into two categories: 1.Procedural decisions relating to planning and organizing a business (entrepreneurial decisions} 2.Legal Aspects. Procedural Aspects Business activities were limited and simple before industrial revolution. Goods were generally produced for local markets. The arranging of various factors of production was nat a difficult proposition.The procurement of various requirements,i.e,capital,raw materials,labour,etc.and disposal of finished goods were all local issues. The industrial revolution in the west change the methods of production .The arranging of production on a large scale required procurement of various factors of production on similar scale. Moreover, competition for the sale of goods has become another important factor. the complexit6ies of business have increased manifold. The main aspects generally confronted by business enterprise at the time of establishment are
1.Product Analysis 2.Marketing Products.3.Financial Planning 4.Size of business Unit 5.Internal organization 6.location of the unit. 7.Plant layout. 8.Launching an enterprise. Legal Aspects. Legal aspects of promotion deals with the formalities required for setting up abusiness .A join stock company requires a number of legal formalities before it can be set up.It has to deal with the following aspects: A. Registration or Incorporation B. Capital Subscription. C. Commencement of Business.
Steps for incorporating a company. .. A. Application For Approval of Name. B. Preparation of Memorandum of Association (MOA) C. Preparation of Articles of Association (AOA) D. Preparation of Other Documents. E. Payment of Fees. F. Incorporation Certificate
UNIT 3:
MEANING OF EDP Entrepreneurial development programmed is developed to help a person in strengthening his Entrepreneurial motive and in acquiring skills and capabilities necessary for playing his Entrepreneurial role effectively.it is necessary to promote enterpreneurials understanding of motives, motivation pattern ,their impact on behavior. Objective of EDPs Develop and strength their entrepreneurial quality. Analysis environmental set up relating to small industry and small business. Select product Formulate project for the product Know pros and cons in becoming an entrepreneurs Develop a broad vision about the business.
c) Tie-up of guest faculty for the training purpose. Like that 2) Training Phase a) Purpose of training is to develop need for achievement b) Role play as like entrepreneur 3) Post-training Phases a) Follow- up b) Review the pre- training work c) Review the process of training programmes and d) Review past training approach
Agency to be contacted
District Industries Centre/ Small Industries service Institutes/ Technical consultancy agencies like CERI for specified products. District Industries centre/ Department of Industries and Commerce District Industries Centres.
4.
Small Scale Industries Development Corporation Respective Corporation/ Municipality Punchayat, where the unit is to set up. Respective State pollution control Boards. Chief Inspector of factories and Boilers State finance Corporations for term loans State Commercial Tax Office Water supply and sewage Board State Electricity Board Joint Director (SSI) The Joint Chief Controller of Imports and Exports National Small Industries Corporation (NSIC) Regional Offices. The foreign Investment promotion board, Ministry of Industrial Development, Govt. of India Bureau of Indian Standards Institution, New Delhi The Controller of Patent and Designs Registrar of Trade Marks Respective State Small Industries Marketing Corporation Export Promotion Council /Cell Trade Development authority State Trading Corporation Export Credit Guarantee Corporation and Export Inspection agency. Small Industries Service Institutes and Regional Testing Laboratories Project and product development
14. Obtaining machinery on hire /purchase 15. Foreign Collaboration 16. 17. 18. 19. ISI Certificate Patent Right Registration of Trade Marks Marketing Assistance Internal Marketing Export Marketing
20. Testing, Training and other extension facilities 21. Product Development Assistance
Support Institutions
2.
Society for Innovation and Entrepreneurship (SINE)- IIT Bombay Set up in 2004 It currently has 16 companies under its incubation programme
3. Cell for Tech Innovation, Development & entrepreneurship support- IIT Chennai Set up in 2000 Organises national level competitions, Breakthrough (general business plan competition) and Genesis (social entrepreneurship plan competition)
4.
Society for Innovation and Development (SID) - IISc, Bangalore Set up in 2006 The investigator is given a seed capital for Rs 20 lakh a year for two years as soft loan for the approved plan
o o 5.
The SP Jain Centre for Entrepreneurship Development- SPJIMR o 16-week 'Start Your Own Business' programme-a public programme held every six months.
6.
Technology Business Incubator (TBI) - BITS Pilani o In association with DST, BITS has established Technology Business Incubator in the area of embedded systems and VLSI design back in 2004 So far, TBI has helped spawn ten companies.
o 7.
Technology Incubation and Entrepreneurial Training Society (TIETS) IIT Kharagpur o Set up in 2005, So far, the institute has been able to incubate two companies through Concipio over the last three years. Besides, an in house panel has helped 11-12 ventures take wing
8.
Nirma Labs, Nirma University, Ahmedabad Established in 2004, Nirma Labs used to pride itself in a three-step model for students who were interested to start their own businesses-training, incubation and funding.
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