Entrepreneurial Role and Tasks | CMAT Mock Test Series - CAT PDF Download

 Page 1


 Entrepreneurial Role and Tasks
An entrepreneur is a person who takes risk of setting up his own venture for perceived 
returns. He is a person who initiates the ideas, formulates a plan, organizes resources and 
puts the plan into action to achieve his/her goals. Entrepreneurs have speci?c qualities, 
they have special strengths which they draw upon for their adventure into business. To 
start and succeed in your enterprise you are required to play di?erent roles at di?erent 
stages of your enterprise. 
When the organsiation moves from phase 1 to Phase 5 the journey from being a new 
‘enterprise’ to becoming an established institution is a most tricky, delicate & challenging 
role.
!e theory of organizational behavior distinguishes ?ve classic phases in thedevelopment 
of an organization.
Phase 1: Enterprise / Creativity
Phase 2: Establishment / Professional Management
Phase 3: Delegation of Authority
Phase 4: Coordination between the various parts of the organization
Phase 5:Cooperation between the various parts of the organization. 
Key roles of an entrepreneur
In your own business you have the vision of doing what you love to do every day with 
passion. As you ramp up for success, there are key roles every business owner needs to 
play the roles of …
1.  !e Architect: Big-Picture Planning Entrepreneurs set the vision, and culture 
around a big and daring goal. In doing so, they must have a general plan for where 
they want to go, but they should not get hung up on developing the perfect plan. 
!eir thinking should be like an architect in the concept and design development 
phase rather than one in the detailed schematic phase. !e details of every initiative 
should change with new customer and market feedback. !is is why the best venture 
capitalists bet ?rst and foremost on the people and second — and it’s a distant second 
— on the plan. !ere is no doubt that it’s easier to adjust a plan than it is to adjust 
people. Plans at the start-up stage need a clear purpose and the top few priorities for 
achieving it, but many other aspects, including product development, have to be 
viewed as a ?rst direction at this point in time.
2.  !e Storyteller: Researching and Selling Great entrepreneurs need to be constantly 
selling the story of their vision, as well as researching how it should evolve. Whether 
Page 2


 Entrepreneurial Role and Tasks
An entrepreneur is a person who takes risk of setting up his own venture for perceived 
returns. He is a person who initiates the ideas, formulates a plan, organizes resources and 
puts the plan into action to achieve his/her goals. Entrepreneurs have speci?c qualities, 
they have special strengths which they draw upon for their adventure into business. To 
start and succeed in your enterprise you are required to play di?erent roles at di?erent 
stages of your enterprise. 
When the organsiation moves from phase 1 to Phase 5 the journey from being a new 
‘enterprise’ to becoming an established institution is a most tricky, delicate & challenging 
role.
!e theory of organizational behavior distinguishes ?ve classic phases in thedevelopment 
of an organization.
Phase 1: Enterprise / Creativity
Phase 2: Establishment / Professional Management
Phase 3: Delegation of Authority
Phase 4: Coordination between the various parts of the organization
Phase 5:Cooperation between the various parts of the organization. 
Key roles of an entrepreneur
In your own business you have the vision of doing what you love to do every day with 
passion. As you ramp up for success, there are key roles every business owner needs to 
play the roles of …
1.  !e Architect: Big-Picture Planning Entrepreneurs set the vision, and culture 
around a big and daring goal. In doing so, they must have a general plan for where 
they want to go, but they should not get hung up on developing the perfect plan. 
!eir thinking should be like an architect in the concept and design development 
phase rather than one in the detailed schematic phase. !e details of every initiative 
should change with new customer and market feedback. !is is why the best venture 
capitalists bet ?rst and foremost on the people and second — and it’s a distant second 
— on the plan. !ere is no doubt that it’s easier to adjust a plan than it is to adjust 
people. Plans at the start-up stage need a clear purpose and the top few priorities for 
achieving it, but many other aspects, including product development, have to be 
viewed as a ?rst direction at this point in time.
2.  !e Storyteller: Researching and Selling Great entrepreneurs need to be constantly 
selling the story of their vision, as well as researching how it should evolve. Whether 
raising funds, evangelizing the vision among employees, recruiting top new talent, 
or selling the product itself. An entrepreneur needs to constantly pitch and act as the 
enterprise’s chief storyteller. 
3.  !e Disciplinarian: Executing Excellent execution comes from adhering to a tight 
set of controls and operating principles. 
4.  Chief Customer O?cer. Let’s face it – if you don’t have customers, you don’t have a 
business. Here’s the challenge many business owners face: they confuse great customer 
experience with great customer service. For example, they think smiling, saying thank 
you and being nice will get them where they need to go which is no longer the 
case. !e customer experience involves every touch point a customer has with your 
business and isn’t about tactics, it’s about creating a true customer experience strategy 
and then executing on it. 
5.  Chief Financial O?cer. !e part of running a business almost everyone would like 
to get rid of – bookkeeping, accounting and tax. !e reality is these are some of the 
most important functions in your business and your numbers actually tell a story – a 
story of where you’ve been, how healthy your business is and what you should change 
to be successful in the long term. If numbers is not your area, ?nd someone who loves 
them (like an accountant or bookkeeper) and make sure you have regular, proactive, 
ongoing communication with them & also learn the basics of ?nancial fundamentals 
& analysis. 
6.  Chief People O?cer. You may not have employees yet but nonetheless, you’re now 
in a leadership role. !e most important person you need to look after? You! It’s easy 
as an entrepreneur to get caught up in everything that needs to get done and ?nd 
yourself working all hours of the day and night. Doing something you love and are 
passionate about makes time ?y by. Make sure you take time to look after you and 
exercise, eat properly and get some rest and time for di?erent activities. You’ll need it 
to keep fueling the passion!
7.  Chief Executive O?cer. !e CEO of any company spends a great deal of time 
looking at the big picture, planning for the future and creating a vision. At the same 
time, when you’re running the show, it’s easy to get bogged down in the details. Make 
sure you are spending a signi?cant amount of your time on the strategy – it’s what 
which will lay the foundation for your future success.
8.  Chief Innovation O?cer. So this may not be the most common title but it’s critical 
to your long term success and sustainability. In order to stay relevant, competitive 
and on the top of your game, you need to reinvent yourself – challenging the status 
quo, innovating and looking for new o?erings that keep your customers coming 
back. Time spent innovating truly is an investment, so don’t overlook how important 
this role is.
Page 3


 Entrepreneurial Role and Tasks
An entrepreneur is a person who takes risk of setting up his own venture for perceived 
returns. He is a person who initiates the ideas, formulates a plan, organizes resources and 
puts the plan into action to achieve his/her goals. Entrepreneurs have speci?c qualities, 
they have special strengths which they draw upon for their adventure into business. To 
start and succeed in your enterprise you are required to play di?erent roles at di?erent 
stages of your enterprise. 
When the organsiation moves from phase 1 to Phase 5 the journey from being a new 
‘enterprise’ to becoming an established institution is a most tricky, delicate & challenging 
role.
!e theory of organizational behavior distinguishes ?ve classic phases in thedevelopment 
of an organization.
Phase 1: Enterprise / Creativity
Phase 2: Establishment / Professional Management
Phase 3: Delegation of Authority
Phase 4: Coordination between the various parts of the organization
Phase 5:Cooperation between the various parts of the organization. 
Key roles of an entrepreneur
In your own business you have the vision of doing what you love to do every day with 
passion. As you ramp up for success, there are key roles every business owner needs to 
play the roles of …
1.  !e Architect: Big-Picture Planning Entrepreneurs set the vision, and culture 
around a big and daring goal. In doing so, they must have a general plan for where 
they want to go, but they should not get hung up on developing the perfect plan. 
!eir thinking should be like an architect in the concept and design development 
phase rather than one in the detailed schematic phase. !e details of every initiative 
should change with new customer and market feedback. !is is why the best venture 
capitalists bet ?rst and foremost on the people and second — and it’s a distant second 
— on the plan. !ere is no doubt that it’s easier to adjust a plan than it is to adjust 
people. Plans at the start-up stage need a clear purpose and the top few priorities for 
achieving it, but many other aspects, including product development, have to be 
viewed as a ?rst direction at this point in time.
2.  !e Storyteller: Researching and Selling Great entrepreneurs need to be constantly 
selling the story of their vision, as well as researching how it should evolve. Whether 
raising funds, evangelizing the vision among employees, recruiting top new talent, 
or selling the product itself. An entrepreneur needs to constantly pitch and act as the 
enterprise’s chief storyteller. 
3.  !e Disciplinarian: Executing Excellent execution comes from adhering to a tight 
set of controls and operating principles. 
4.  Chief Customer O?cer. Let’s face it – if you don’t have customers, you don’t have a 
business. Here’s the challenge many business owners face: they confuse great customer 
experience with great customer service. For example, they think smiling, saying thank 
you and being nice will get them where they need to go which is no longer the 
case. !e customer experience involves every touch point a customer has with your 
business and isn’t about tactics, it’s about creating a true customer experience strategy 
and then executing on it. 
5.  Chief Financial O?cer. !e part of running a business almost everyone would like 
to get rid of – bookkeeping, accounting and tax. !e reality is these are some of the 
most important functions in your business and your numbers actually tell a story – a 
story of where you’ve been, how healthy your business is and what you should change 
to be successful in the long term. If numbers is not your area, ?nd someone who loves 
them (like an accountant or bookkeeper) and make sure you have regular, proactive, 
ongoing communication with them & also learn the basics of ?nancial fundamentals 
& analysis. 
6.  Chief People O?cer. You may not have employees yet but nonetheless, you’re now 
in a leadership role. !e most important person you need to look after? You! It’s easy 
as an entrepreneur to get caught up in everything that needs to get done and ?nd 
yourself working all hours of the day and night. Doing something you love and are 
passionate about makes time ?y by. Make sure you take time to look after you and 
exercise, eat properly and get some rest and time for di?erent activities. You’ll need it 
to keep fueling the passion!
7.  Chief Executive O?cer. !e CEO of any company spends a great deal of time 
looking at the big picture, planning for the future and creating a vision. At the same 
time, when you’re running the show, it’s easy to get bogged down in the details. Make 
sure you are spending a signi?cant amount of your time on the strategy – it’s what 
which will lay the foundation for your future success.
8.  Chief Innovation O?cer. So this may not be the most common title but it’s critical 
to your long term success and sustainability. In order to stay relevant, competitive 
and on the top of your game, you need to reinvent yourself – challenging the status 
quo, innovating and looking for new o?erings that keep your customers coming 
back. Time spent innovating truly is an investment, so don’t overlook how important 
this role is.
In the economic development role of an entrepreneur.
 !e entrepreneur who is a business leader looks for ideas and puts them into e?ect 
in fostering economic growth and development. Entrepreneurship is one of the most 
important inputs in the economic development of a country. !e entrepreneur acts as a 
trigger head to give spark to economic activities by his entrepreneurial decisions. He plays 
a pivotal role not only in the development of industrial sector of a country but also in the 
development of farm and service sector. !e major roles played by an entrepreneur in the 
economic development of an economy are as follows.
 1. Promotes Capital Formation:
   Entrepreneurs promote capital formation by mobilizing the idle savings of 
public. !ey employ their own as well as borrowed resources for setting up 
their enterprises. Such type of entrepreneurial activities leads to value addition 
and creation of wealth, which is very essential for the industrial and economic 
development of the country.
 2. Creates Large-Scale Employment Opportunities:
   Entrepreneurs provide immediate large-scale employment to the unemployed, 
which is a chronic problem of underdeveloped nations. With the setting up of 
more and more units by entrepreneurs, both on small and large-scale numerous 
job opportunities are created for others. As time passes, these enterprises grow, 
providing direct and indirect employment opportunities to many more. In this 
way, entrepreneurs play an e?ective role in reducing the problem of unemployment 
in the country, which in turn clears the path towards economic development of 
the nation.
 3. Promotes Balanced Regional Development:
   Entrepreneurs help to remove regional disparities through setting up of industries 
in less developed and backward areas. !e growth of industries and business 
in these areas lead to a large number of public bene?ts like road transport, 
health, education, entertainment, etc. Setting up of more industries lead to 
more development of backward regions and thereby promotes balanced regional 
development.
 4. Reduces Concentration of Economic Power:
   Economic power is the natural outcome of industrial and business activity. 
Industrial development normally leads to concentration of economic power 
in the hands of a few individuals, which results in the growth of monopolies. 
In order to redress this problem a large number of entrepreneurs need to be 
developed, which will help reduce the concentration of economic power amongst 
the population.
Page 4


 Entrepreneurial Role and Tasks
An entrepreneur is a person who takes risk of setting up his own venture for perceived 
returns. He is a person who initiates the ideas, formulates a plan, organizes resources and 
puts the plan into action to achieve his/her goals. Entrepreneurs have speci?c qualities, 
they have special strengths which they draw upon for their adventure into business. To 
start and succeed in your enterprise you are required to play di?erent roles at di?erent 
stages of your enterprise. 
When the organsiation moves from phase 1 to Phase 5 the journey from being a new 
‘enterprise’ to becoming an established institution is a most tricky, delicate & challenging 
role.
!e theory of organizational behavior distinguishes ?ve classic phases in thedevelopment 
of an organization.
Phase 1: Enterprise / Creativity
Phase 2: Establishment / Professional Management
Phase 3: Delegation of Authority
Phase 4: Coordination between the various parts of the organization
Phase 5:Cooperation between the various parts of the organization. 
Key roles of an entrepreneur
In your own business you have the vision of doing what you love to do every day with 
passion. As you ramp up for success, there are key roles every business owner needs to 
play the roles of …
1.  !e Architect: Big-Picture Planning Entrepreneurs set the vision, and culture 
around a big and daring goal. In doing so, they must have a general plan for where 
they want to go, but they should not get hung up on developing the perfect plan. 
!eir thinking should be like an architect in the concept and design development 
phase rather than one in the detailed schematic phase. !e details of every initiative 
should change with new customer and market feedback. !is is why the best venture 
capitalists bet ?rst and foremost on the people and second — and it’s a distant second 
— on the plan. !ere is no doubt that it’s easier to adjust a plan than it is to adjust 
people. Plans at the start-up stage need a clear purpose and the top few priorities for 
achieving it, but many other aspects, including product development, have to be 
viewed as a ?rst direction at this point in time.
2.  !e Storyteller: Researching and Selling Great entrepreneurs need to be constantly 
selling the story of their vision, as well as researching how it should evolve. Whether 
raising funds, evangelizing the vision among employees, recruiting top new talent, 
or selling the product itself. An entrepreneur needs to constantly pitch and act as the 
enterprise’s chief storyteller. 
3.  !e Disciplinarian: Executing Excellent execution comes from adhering to a tight 
set of controls and operating principles. 
4.  Chief Customer O?cer. Let’s face it – if you don’t have customers, you don’t have a 
business. Here’s the challenge many business owners face: they confuse great customer 
experience with great customer service. For example, they think smiling, saying thank 
you and being nice will get them where they need to go which is no longer the 
case. !e customer experience involves every touch point a customer has with your 
business and isn’t about tactics, it’s about creating a true customer experience strategy 
and then executing on it. 
5.  Chief Financial O?cer. !e part of running a business almost everyone would like 
to get rid of – bookkeeping, accounting and tax. !e reality is these are some of the 
most important functions in your business and your numbers actually tell a story – a 
story of where you’ve been, how healthy your business is and what you should change 
to be successful in the long term. If numbers is not your area, ?nd someone who loves 
them (like an accountant or bookkeeper) and make sure you have regular, proactive, 
ongoing communication with them & also learn the basics of ?nancial fundamentals 
& analysis. 
6.  Chief People O?cer. You may not have employees yet but nonetheless, you’re now 
in a leadership role. !e most important person you need to look after? You! It’s easy 
as an entrepreneur to get caught up in everything that needs to get done and ?nd 
yourself working all hours of the day and night. Doing something you love and are 
passionate about makes time ?y by. Make sure you take time to look after you and 
exercise, eat properly and get some rest and time for di?erent activities. You’ll need it 
to keep fueling the passion!
7.  Chief Executive O?cer. !e CEO of any company spends a great deal of time 
looking at the big picture, planning for the future and creating a vision. At the same 
time, when you’re running the show, it’s easy to get bogged down in the details. Make 
sure you are spending a signi?cant amount of your time on the strategy – it’s what 
which will lay the foundation for your future success.
8.  Chief Innovation O?cer. So this may not be the most common title but it’s critical 
to your long term success and sustainability. In order to stay relevant, competitive 
and on the top of your game, you need to reinvent yourself – challenging the status 
quo, innovating and looking for new o?erings that keep your customers coming 
back. Time spent innovating truly is an investment, so don’t overlook how important 
this role is.
In the economic development role of an entrepreneur.
 !e entrepreneur who is a business leader looks for ideas and puts them into e?ect 
in fostering economic growth and development. Entrepreneurship is one of the most 
important inputs in the economic development of a country. !e entrepreneur acts as a 
trigger head to give spark to economic activities by his entrepreneurial decisions. He plays 
a pivotal role not only in the development of industrial sector of a country but also in the 
development of farm and service sector. !e major roles played by an entrepreneur in the 
economic development of an economy are as follows.
 1. Promotes Capital Formation:
   Entrepreneurs promote capital formation by mobilizing the idle savings of 
public. !ey employ their own as well as borrowed resources for setting up 
their enterprises. Such type of entrepreneurial activities leads to value addition 
and creation of wealth, which is very essential for the industrial and economic 
development of the country.
 2. Creates Large-Scale Employment Opportunities:
   Entrepreneurs provide immediate large-scale employment to the unemployed, 
which is a chronic problem of underdeveloped nations. With the setting up of 
more and more units by entrepreneurs, both on small and large-scale numerous 
job opportunities are created for others. As time passes, these enterprises grow, 
providing direct and indirect employment opportunities to many more. In this 
way, entrepreneurs play an e?ective role in reducing the problem of unemployment 
in the country, which in turn clears the path towards economic development of 
the nation.
 3. Promotes Balanced Regional Development:
   Entrepreneurs help to remove regional disparities through setting up of industries 
in less developed and backward areas. !e growth of industries and business 
in these areas lead to a large number of public bene?ts like road transport, 
health, education, entertainment, etc. Setting up of more industries lead to 
more development of backward regions and thereby promotes balanced regional 
development.
 4. Reduces Concentration of Economic Power:
   Economic power is the natural outcome of industrial and business activity. 
Industrial development normally leads to concentration of economic power 
in the hands of a few individuals, which results in the growth of monopolies. 
In order to redress this problem a large number of entrepreneurs need to be 
developed, which will help reduce the concentration of economic power amongst 
the population.
 5. Wealth Creation and Distribution:
   It stimulates equitable redistribution of wealth and income in the interest of 
the country to more people and geographic areas, thus giving bene?t to larger 
sections of the society. Entrepreneurial activities also generate more activities and 
give a multiplier e?ect in the economy.
 6. Increasing Gross National Product and Per Capita Income:
   Entrepreneurs are always on the look out for opportunities. !ey explore and 
exploit opportunities, encourage e?ective resource mobilization of capital and 
skill, bring in new products and services and develop markets for growth of the 
economy. In this way, they help in increasing gross domestic product as well as 
per capita income of the people in a country. Increase in gross domestic product 
and per capita income of the people in a country, is a sign of economic growth.
 7. Improvement in the Standard of  Living:
   Increase in the standard of living of the people is a characteristic feature 
of economic development of the country. Entrepreneurs play a key role in 
increasing the standard of living of the people by adopting latest innovations 
in the production of wide variety of goods and services on a large scale and that 
too at a lower cost. !is enables the people to avail better quality goods at lower 
prices which results in the improvement of their standard of living.
 8. Promotes Country’s Export Trade:
   Entrepreneurs help in promoting a country’s export-trade, which is an important 
ingredient of economic development. !ey produce goods and services in large 
scale for the purpose of earning large amount of foreign exchange from export 
in order to combat the import dues requirements. !us import substitution and 
export promotion ensure economic independence and development.
 9. Induces Backward and Forward Linkages:
   Entrepreneurs like to work in an environment of change and try to maximise 
pro?ts by innovation. When an enterprise is established in accordance with the 
changing technology, it induces backward and forward linkages, which stimulate 
the process of economic development in the country.
 10. Facilitates Overall Development:
   Entrepreneurs act as catalytic agents for change, which leads to chain reaction. 
Once an enterprise is established, the process of industrialization is set in motion. 
Such unit will generate demand for various types of units required by it and there 
will be many other units, which require the output of this unit. !is leads to 
overall development of an area due to increase in demand and setting up of more 
and more units. In this way, the entrepreneurs multiply their entrepreneurial 
Page 5


 Entrepreneurial Role and Tasks
An entrepreneur is a person who takes risk of setting up his own venture for perceived 
returns. He is a person who initiates the ideas, formulates a plan, organizes resources and 
puts the plan into action to achieve his/her goals. Entrepreneurs have speci?c qualities, 
they have special strengths which they draw upon for their adventure into business. To 
start and succeed in your enterprise you are required to play di?erent roles at di?erent 
stages of your enterprise. 
When the organsiation moves from phase 1 to Phase 5 the journey from being a new 
‘enterprise’ to becoming an established institution is a most tricky, delicate & challenging 
role.
!e theory of organizational behavior distinguishes ?ve classic phases in thedevelopment 
of an organization.
Phase 1: Enterprise / Creativity
Phase 2: Establishment / Professional Management
Phase 3: Delegation of Authority
Phase 4: Coordination between the various parts of the organization
Phase 5:Cooperation between the various parts of the organization. 
Key roles of an entrepreneur
In your own business you have the vision of doing what you love to do every day with 
passion. As you ramp up for success, there are key roles every business owner needs to 
play the roles of …
1.  !e Architect: Big-Picture Planning Entrepreneurs set the vision, and culture 
around a big and daring goal. In doing so, they must have a general plan for where 
they want to go, but they should not get hung up on developing the perfect plan. 
!eir thinking should be like an architect in the concept and design development 
phase rather than one in the detailed schematic phase. !e details of every initiative 
should change with new customer and market feedback. !is is why the best venture 
capitalists bet ?rst and foremost on the people and second — and it’s a distant second 
— on the plan. !ere is no doubt that it’s easier to adjust a plan than it is to adjust 
people. Plans at the start-up stage need a clear purpose and the top few priorities for 
achieving it, but many other aspects, including product development, have to be 
viewed as a ?rst direction at this point in time.
2.  !e Storyteller: Researching and Selling Great entrepreneurs need to be constantly 
selling the story of their vision, as well as researching how it should evolve. Whether 
raising funds, evangelizing the vision among employees, recruiting top new talent, 
or selling the product itself. An entrepreneur needs to constantly pitch and act as the 
enterprise’s chief storyteller. 
3.  !e Disciplinarian: Executing Excellent execution comes from adhering to a tight 
set of controls and operating principles. 
4.  Chief Customer O?cer. Let’s face it – if you don’t have customers, you don’t have a 
business. Here’s the challenge many business owners face: they confuse great customer 
experience with great customer service. For example, they think smiling, saying thank 
you and being nice will get them where they need to go which is no longer the 
case. !e customer experience involves every touch point a customer has with your 
business and isn’t about tactics, it’s about creating a true customer experience strategy 
and then executing on it. 
5.  Chief Financial O?cer. !e part of running a business almost everyone would like 
to get rid of – bookkeeping, accounting and tax. !e reality is these are some of the 
most important functions in your business and your numbers actually tell a story – a 
story of where you’ve been, how healthy your business is and what you should change 
to be successful in the long term. If numbers is not your area, ?nd someone who loves 
them (like an accountant or bookkeeper) and make sure you have regular, proactive, 
ongoing communication with them & also learn the basics of ?nancial fundamentals 
& analysis. 
6.  Chief People O?cer. You may not have employees yet but nonetheless, you’re now 
in a leadership role. !e most important person you need to look after? You! It’s easy 
as an entrepreneur to get caught up in everything that needs to get done and ?nd 
yourself working all hours of the day and night. Doing something you love and are 
passionate about makes time ?y by. Make sure you take time to look after you and 
exercise, eat properly and get some rest and time for di?erent activities. You’ll need it 
to keep fueling the passion!
7.  Chief Executive O?cer. !e CEO of any company spends a great deal of time 
looking at the big picture, planning for the future and creating a vision. At the same 
time, when you’re running the show, it’s easy to get bogged down in the details. Make 
sure you are spending a signi?cant amount of your time on the strategy – it’s what 
which will lay the foundation for your future success.
8.  Chief Innovation O?cer. So this may not be the most common title but it’s critical 
to your long term success and sustainability. In order to stay relevant, competitive 
and on the top of your game, you need to reinvent yourself – challenging the status 
quo, innovating and looking for new o?erings that keep your customers coming 
back. Time spent innovating truly is an investment, so don’t overlook how important 
this role is.
In the economic development role of an entrepreneur.
 !e entrepreneur who is a business leader looks for ideas and puts them into e?ect 
in fostering economic growth and development. Entrepreneurship is one of the most 
important inputs in the economic development of a country. !e entrepreneur acts as a 
trigger head to give spark to economic activities by his entrepreneurial decisions. He plays 
a pivotal role not only in the development of industrial sector of a country but also in the 
development of farm and service sector. !e major roles played by an entrepreneur in the 
economic development of an economy are as follows.
 1. Promotes Capital Formation:
   Entrepreneurs promote capital formation by mobilizing the idle savings of 
public. !ey employ their own as well as borrowed resources for setting up 
their enterprises. Such type of entrepreneurial activities leads to value addition 
and creation of wealth, which is very essential for the industrial and economic 
development of the country.
 2. Creates Large-Scale Employment Opportunities:
   Entrepreneurs provide immediate large-scale employment to the unemployed, 
which is a chronic problem of underdeveloped nations. With the setting up of 
more and more units by entrepreneurs, both on small and large-scale numerous 
job opportunities are created for others. As time passes, these enterprises grow, 
providing direct and indirect employment opportunities to many more. In this 
way, entrepreneurs play an e?ective role in reducing the problem of unemployment 
in the country, which in turn clears the path towards economic development of 
the nation.
 3. Promotes Balanced Regional Development:
   Entrepreneurs help to remove regional disparities through setting up of industries 
in less developed and backward areas. !e growth of industries and business 
in these areas lead to a large number of public bene?ts like road transport, 
health, education, entertainment, etc. Setting up of more industries lead to 
more development of backward regions and thereby promotes balanced regional 
development.
 4. Reduces Concentration of Economic Power:
   Economic power is the natural outcome of industrial and business activity. 
Industrial development normally leads to concentration of economic power 
in the hands of a few individuals, which results in the growth of monopolies. 
In order to redress this problem a large number of entrepreneurs need to be 
developed, which will help reduce the concentration of economic power amongst 
the population.
 5. Wealth Creation and Distribution:
   It stimulates equitable redistribution of wealth and income in the interest of 
the country to more people and geographic areas, thus giving bene?t to larger 
sections of the society. Entrepreneurial activities also generate more activities and 
give a multiplier e?ect in the economy.
 6. Increasing Gross National Product and Per Capita Income:
   Entrepreneurs are always on the look out for opportunities. !ey explore and 
exploit opportunities, encourage e?ective resource mobilization of capital and 
skill, bring in new products and services and develop markets for growth of the 
economy. In this way, they help in increasing gross domestic product as well as 
per capita income of the people in a country. Increase in gross domestic product 
and per capita income of the people in a country, is a sign of economic growth.
 7. Improvement in the Standard of  Living:
   Increase in the standard of living of the people is a characteristic feature 
of economic development of the country. Entrepreneurs play a key role in 
increasing the standard of living of the people by adopting latest innovations 
in the production of wide variety of goods and services on a large scale and that 
too at a lower cost. !is enables the people to avail better quality goods at lower 
prices which results in the improvement of their standard of living.
 8. Promotes Country’s Export Trade:
   Entrepreneurs help in promoting a country’s export-trade, which is an important 
ingredient of economic development. !ey produce goods and services in large 
scale for the purpose of earning large amount of foreign exchange from export 
in order to combat the import dues requirements. !us import substitution and 
export promotion ensure economic independence and development.
 9. Induces Backward and Forward Linkages:
   Entrepreneurs like to work in an environment of change and try to maximise 
pro?ts by innovation. When an enterprise is established in accordance with the 
changing technology, it induces backward and forward linkages, which stimulate 
the process of economic development in the country.
 10. Facilitates Overall Development:
   Entrepreneurs act as catalytic agents for change, which leads to chain reaction. 
Once an enterprise is established, the process of industrialization is set in motion. 
Such unit will generate demand for various types of units required by it and there 
will be many other units, which require the output of this unit. !is leads to 
overall development of an area due to increase in demand and setting up of more 
and more units. In this way, the entrepreneurs multiply their entrepreneurial 
activities, thus creating an environment of enthusiasm and conveying an impetus 
for overall development of the area.
  !e ?rst step is knowing which role your talents match most closely.