Notes Entrepreneurial Skills Class10 – Simple and Comprehensive

Notes Entrepreneurial Skills Class10 will discuss simple and comprehensive notes for Entrepreneurial Skills class 10 which is part of CBSE skill courses for class 10. This is one of the chapters of Part A – Employability skills. So let us begin!

Notes Entrepreneurial Skills Class10

In this article, Notes Entrepreneurial Skills Class 10 you will get comprehensive and simple notes for the topic. Let us begin with its significance in Class 10 for skill courses.

This chapter has very much importance in the class 10 syllabus. Plan your lessons as follows:

So let’s begin Notes Entrepreneurial Skills Class10. Here we go!

Introduction to Entrepreneurial skills

A human being is constantly developing himself. For that he is putting his efforts in two ways:

1. Self employment
2. Wage employment

Self Employment

Self employment refers to starting a business to satisfy the need of people. A self employed person who starts the business to satisfy the need of people.

Wage Employment

Wage employment refers to working for others and being paid for that work.

What is entrepreneurship?

Entrepreneurship refers to self-employment in which individuals run a business to meet people’s needs and strive to improve their business for profitability.

Who is an Entrepreneur?

An entrepreneur is a person who is always trying to make his/her business better by taking risks and trying new ideas.

Example:

Amit and Sumit both own a stationary shop. Amit is handling the shop at his own place. Customers are coming to him and he is doing his business. Sumit is walks around and get his customer. He is also doing the work of laminations and bindings.

Sumit is working more to grow his business. He has added different ideas to his business. So he is an entrepreneur.

Amit is just doing business here.

Entrepreneurs and the Society

So now you have observed that entrepreneurs are doing their job around us. They run their business in the market. From the market, people will get their products and services who need them. This process of buying and selling helps society to grow.

Basically, entrepreneurs satisfy customers’ needs, wants, and demands in the market.

Akash has opened a shop selling electronic gadgets and home appliances. He has many customers. He buys the products from manufacturers directly and sells them in wholesale and individually. He hired four people in the shop and signed a contract with a transport company for home delivery.

Here Akash is helping people in his area to make money and decrease unemployment locally. He improves the lives of people in his nearby area.

Helps in society

So let us discuss now an entrepreneur helps in society. Here it is!

Role of entrepreneurs

An entrepreneurs perform these roles:

1. Innovator’s Role
   • Entrepreneurs innovate by bringing unique and new products and services into the market.
   • In many cases, these are improved versions of existing products or services available.
   • Innovation fuels economic growth and helps to boost global presence of products and services.
2. Agent’s role
   • Entrepreneurs act as ‘Agents of Change’ as they identify opportunities, solve problems, offer effective solutions, establish enterprises, set up industries and bring positive change for the economy.
3. Coordinating role
   • An entrepreneur coordinates many things such as factors of production, delegated tasks, smooth functioning across different business departments, timely delivery of inputs and outputs etc.
   • However, by combining resources in an optimal and best possible manner, an entrepreneur even makes use of under-utilized resources in an economy.
4. Risk assumption role
   • Entrepreneurs are not risk-aversive and they realize that taking risks is a part of business.
   • The fruit of bearing risks can be profit, which leads to wealth generation for overall economy.
5. Capital formation role
   • Mobilization of idle savings takes place when money is invested in a business.
   • This mobilisation of capital leads to development of assets, trade activities, increase in capital availability and economic development.
6. Imitating role
   • In many developing countries, entrepreneurs either imitate or adapt the innovations of developed nations.
   • These innovations are adapted according to the local needs and conditions and work towards overcoming the entrepreneurial challenges.
7. Employment Generation role
   • Businesses cannot function without employing people.
   • Skilled professionals, unskilled labour and managerial staff are all required by businesses.
   • Hence, entrepreneurship solves the problem of unemployment, which is a major problem in economic development.
8. Status transformation role
   • Since more and more people are employed by entrepreneurs, overall income and standard of living of the society increases.
   • This encourages equitable distribution of wealth and reduces income disparity in the economy.
9. Balancing role:
   • Entrepreneurship is encouraged with small and micro enterprises and small-scale industries as well.
   • This encourages regional development and removes development imbalances in the economy.

Positive impacts on society

An entrepreneur has the following positive impacts on society:

Role of Society in Boosting Entrepreneur

Society plays an important role in boosting entrepreneurs by:

Activities related to society

The activities related to society by an entrepreneur are as follows:

Read this story of Bharti, the Jewellery queen.

Bharti A young woman from Bihar. Many girls in her area like to wear earrings. She buys jute from a farmer and makes earrings from that. Her business is called Manavi Natural Handicrafts. She sees that most women in her village do not work. So, she hires two women to help her. As her orders increase, she buys more jute. She hires three more women to work for her. The farmer and the women working for her now earn more money. They are able to save money for their future.

Qualities of an Entrepreneur

Quality is the way in which a person acts or behaves. The qualities of an entrepreneur are as follows:

1. Hardowking:
   • Hardworking is the key to success.
   • A successful entrepreneur is working for more than usual hours between 60 to 90 hours weekly, the normal working hours are 40 hours
   • In his efforts, he puts in lots of trial-and-error methods
2. Optimism
   • For a successful entrepreneur, positivity and belief are very important factors
   • Entrepreneurs should think negatively and be afraid of adverse situations
   • He should learn from his mistakes
   • Always tries to find an alternative solution to the problem
3. Independence:
   • They should have autonomy and self-assure
   • They are not working for someone else, they like to be their own boss
   • They enjoy their freedom to run the business
4. Energetic
   • They have a lot of energy and drive which makes them proactive
   • They are always acting to attempt various strategies and carry out tasks.
5. Self-confident
   • Confident entrepreneurs have conviction in their own abilities and vision
   • They have a strong drive toward achieving their objectives
   • In order to sell their idea to every stakeholder, entrepreneurs are able to convey their enthusiasm and vision to investors, staff members, customers, etc.
6. Perseverant
   • They have a mindset that supports accepting failure, learning from mistakes, persevering, never giving up, and constant experimentation.
   • Their businesses must never give up on their goals

Functions of Entrepreneur

An entrepreneur performs these functions:

Rajesh Marwaha and J.S.Mahendipur have given a comprehensive classification of the function of the entrepreneur in their book ‘Entrepreneurship and Small Business’.

Let’s discuss them in short:

1. Entrepreneurial Functions: These functions are related to organization and infrastructure.
   • Organization Building and Management is about
     • bringing together different factors of production
     • allocating resources to bring down costs and loses
     • taking all decisions related to business
     • Taking various steps to build an organization such as hiring people, organizing the factor of production, sourcing finance etc.
   • Risk Taking includes
     • Taking responsibility and planning for a loss
     • Return on Investment
     • Hiring new employees
     • Working with vendors
   • Innovation refers to
     • introducing new concepts, products, services, designs, ideas etc.
     • a new business cannot survive and sustain without innovating in some manner in today’s world
2. Promotional functions:
   • Idea Discovery refers to
     • The first step towards entrepreneurship
     • comes up with a business idea and thinks about ways to implement
     • seeking opportunities for a specific type of business and finding ways to commercialize on it
     • work around the process of idea discovery by exploiting natural resources, finding a market need or calculating the profit potential
   • Detailed Investigation includes
     • While coming up with ideas can seem like an easy process, the challenge is to understand if the idea has the potential to turn into a viable business venture
     • an entrepreneur conducts research, investigates and evaluates
     • an idea considering various factors, and estimates the total demand for a new product or service
   • Assembling the Requirements includes
     • Infrastructure or office space, human resources, key vendors or partners, working capital etc.
     • In the manufacturing business – requirements are selecting the factory site, sourcing plant and machinery, hiring staff, finding the right suppliers etc
     • work towards assembling and organizing all the requirements once he/she is sure about the practicality and profitability of the proposition
   • Financing involves
     • Raising capital for a business is one of the core functions to grow and scale the business.
     • First, the requirements of finances are estimated.
     • Next, the sources from which capital will come are determined.
     • This includes calculating the long-term and short-term financial requirements and considering the debt-equity ratio.
3. Managerial functions
   • Planning
     • An entrepreneur documents a business idea in the form of a business plan
     • It allows for details of each element of the business such as product or service description, operations, marketing, finance, accounting, growth plan etc.
     • A business plan serves as a guide to determine the business objectives and the course of action.
     • It helps to detail the “what, when, how and who” of doing every specific task.
   • Organizing refers to
     • setting specific and attainable goals and objectives to be achieved by different departments and by each employee.
     • arranging, directing, guiding, coordinating and controlling the key business activities.
   • Directing is about
     • initiating planned action and ensuring that each employee is performing effectively
     • This also includes doing continuous performance reviews and organizing tasks according to plans
   • Staffing refers to
     • different sub-processes around human resource management, such as manpower planning, recruitment, selection, placement, training, transfer, salary, promotion, payroll, appraisal etc.
     • The objective of staffing is to fill a particular position with the right employee at the right time.
   • Leadership includes
     • leading, guiding and supervising people who work for the business.
     • As a leader, an entrepreneur guides, directs, and influences the work of others to attain specific goals.
     • An entrepreneur acts as a mediator between the individual and the organization to ensure mutual benefit satisfaction.
   • Communication
     • enables the exchange of feelings, ideas, emotions, information and knowledge between two or more persons.
     • An entrepreneur has to communicate every single day, in the form of writing, responding, drafting emails, verbal instruction, discussion etc.
     • On an average, entrepreneurs spend 75%-90% of their work time communicating with others.
   • Supervision
     • Supervision is a key skill as even overseeing that things are being executed well is important. An entrepreneur might delegate tasks and give instructions, but it is important to ensure that these instructions are carried out well.
     • For example, some tasks entrepreneurs supervise are tracking utilization of resources, correcting subordinates where they go wrong, getting the required work done as directed, ensuring all functions of the business are running smoothly etc.
   • Motivation
     • Along with guiding employees, an entrepreneur also plays a role of motivating them and encouraging positive behaviour and culture within the organization.
     • Motivating employees is about creating an urge in them to exhibit a desired behaviour and positive attitude towards work.
     • Employees with high motivation automatically do other things alongwith it to perform successfully, such as being productive, flexible, competitive, comprehensive, efficient etc.
   • Co-ordination
     • Co-ordination between different departments of the business helps to ensure that work happens in a timely manner.
     • Activities of all employees must be channelized towards goal achievement. An entrepreneur has to set certain targets, measures, goals etc. with different departments to ensure all are coordinating and working effectively internally as well.
   • Controlling
     • Sometimes controlling is necessary for the entrepreneur to set company rules and policies.
     • The controlling function helps the entrepreneur to set performance standards, measure and compare productivity and performance, identify variations, take corrective action etc.
   • Negotiation
     • An entrepreneur negotiates terms and conditions for many parts of the business such as payment terms and timelines, salaries of employees, vendor quotations etc.
4. Commercial Functions
   • Production and Operations
     • an entrepreneur has to perform the function of managing production or operations.
     • For a manufacturing business, production related activities include sourcing of raw materials, checking functioning of machinery, utilising maximum capacity, meeting order requirements etc.
   • Finance and Accounting
     • While finance is more focused on raising funds and managing them, accounting helps to record and analyse the financial position of the business.
     • Thus, an entrepreneur has to prepare and analyse cash flow statements, income sheet, balance sheet etc.
   • Marketing is about
     • moving the product or service from producer into the hands of the end customer or user
     • It involves promotion, advertising, distribution, customer service etc
     • An entrepreneur has to perform this function to make people aware about the offerings of the business and makes sales.
   • Human Resource Management (HRM) refers to
     • recruitment, employment, selection, training, development, and compensation of the employees within an organization.
     • An entrepreneur performs this function as no business can function without people.

Importance of Entrepreneur

1. Free market evolution
   • In a free market, entrepreneurs are able to respond to changing customer preferences, prices, shifts in demand etc.
   • Entrepreneurs bring change in technology, trends and markets.
   • For example, with increase in digital services, entrepreneurs have created companies that offer many home delivery services such as groceries, restaurant food, clothes, accessories etc.
2. Efficiency improvements
   • Entrepreneurs tend to adapt to an established business and increase their own efficiency.
   • They innovate with current systems and introduce new technologies which can significantly create advancement in an industry.
   • Hence, during any major changes in the economy, entrepreneurs adapt and do not have to go out of business.
3. New markets
   • Entrepreneurs can often ‘redefine the rules’ of an established industry.
   • They do this by creating new markets for existing products and slightly innovating in small ways to suit the needs of a new target market.
4. New values:
   • Sometimes, entrepreneurs choose ethics over profit and offer a more ethical product to the world and are transparent about it.
   • For example, Jaipur Rugs has multiple artisans who work towards making rugs that are sold around the world.
   • However, Jaipur rugs is very transparent about their artisan community and they ensure that artisans are given a fair share of profit.

Myths about entrepreneurship

Myth refers to a false belief or opinion about something. A myth is a misconception. Observe some myths about us:

1. Chewing gum stays in your stomach for many years. The truth is Most chewing gum is not digestible, meaning that it will travel through your system in a matter of two to four days.
2. Wait an hour after eating before you go swimming to prevent cramping. A normal-sized meal consumed before swimming will not cause cramping. It is possible to feel tired and fatigued after overeating, so maybe avoid swimming.
3. We only use 10% of our brain. This is a motivational speaker’s ploy (that can be traced back to the early 1900s) to encourage people to live. Breakfast is actually one of the three most important meals of the day. Our bodies need good nutrition throughout the day, but breakfast is usually the one most often skipped, and it shouldn’t be. up to their full potential. Studies of brain activity have provided no evidence that only 10% of the brain is used.
4. Sitting too close to the TV will make you go blind. Televisions and other devices emit such low radiation levels that they have little effect on the body. However, staring at the same thing for a long period of time can cause the eye muscles to fatigue, thereby affecting vision. But there has been no proof this causes long-term damage.
5. Sugar makes children hyper. A breakfast high in sugar has been shown to result in severe deterioration of attention span when compared to no breakfast or whole-grain cereal. One study reported that children who were given sugar had higher levels of adrenaline — a possible explanation for this misconception because higher adrenaline levels lead to symptoms similar to those of hyperactivity.
6. If you go outside with wet hair on a cold day, you’ll catch a cold. Colds are caused by viruses, which you can’t get just from being outside in the cold. You may feel sick if you’re outside all day in the cold or rain — runny nose, chills, fatigue — but it’s not because of a virus. It’s because you can experience the same symptoms when you are chilled as when you are sick.
7. You lose most of your heat through your head.  If you look at the surface area, the head is no bigger than the rest of your body. It’s maybe about 10-15% of the total surface area, and that’s the percentage of body heat lost through the head.
8. Cracking your knuckles causes arthritis. A 30-year study showed this is not the case. However, knuckle cracking can lessen one’s grip strength because of repeated overstretching of the tendons.
9. Breakfast is the most important meal of the day. Breakfast is actually one of the three most important meals of the day. Our bodies need good nutrition throughout the day, but breakfast is usually the one most often skipped, and it shouldn’t be.

So now let us discuss some of the myths of entrepreneurs. Here we go!

1. Every business idea needs to be unique or special. Each entrepreneur observes the demand of the market and customer and then brings a new idea into the business. A person takes ideas from the existing product or services from the market and does something unique with it.
2. A person needs a lot of money to start a business. Every business needs a capital. Capital refers to the funds required to start a business. Every business does not require huge capital. For starting a business you can start with the funds which you have then gradually you can invest more later.
3. Only a person having a big business is an entrepreneur. No business is big or small. If a person is running a business to fulfill a customer need, they are an entrepreneur. Most businesses start small. It becomes big with hard work and creativity.
4. Entrepreneurs are born, not made. It is an assumption that entrepreneurial qualities are inborn and that only people with certain natural talents can become entrepreneurs. Research has established that almost anyone can be an entrepreneur with the right skills, drive, and passion. There is no set defined way to point towards personality types of entrepreneurs. Entrepreneurship is a learned skill, not a natural-born ability.
5. Entrepreneurs have to take a lot of risks. While entrepreneurs definitely have to bear some risks, they do not necessarily put themselves in high-risk situations. Entrepreneurs take calculated risks and weigh risk versus reward.
6. Businesses either skyrocket or fail. Although a select few start-ups skyrocket and receive all the media attention, it is easy to adopt an all-or-nothing outlook on entrepreneurship. While many ventures make it big and many fail, a lot of businesses are run with patience and strategy with a focus on self-sustenance and gradual growth.
7. One must know everything before starting a business. Entrepreneurs continuously strive to be in a constant state of learning. Being new and even somewhat naïve can be an asset in today’s rapidly changing world because succeeding at entrepreneurship requires energy, innovation, and the ability to push yourself outside your comfort zone. What actually counts is not what you know, but how fast you can learn.

Entrepreneurship as a career option

Many people are not aware that having their own business or independent work can be a choice.

A career is one of the most important aspects of life. It is a line of work that a person takes for life. A person can earn money to live a happy life in two ways:

1. Self-Employment
2. Wage-Employment

A teacher is working for a school or an institute or a tution classes, is a wage employed person. If he/she has his own classes setup , he/she is an entrepreneur.

Every entrepreneur goes through a simple career process. This process includes these basic steps:

1. Enter
2. Survive
3. Grow