Short and Long Question Answers: Entrepreneurship as Innovation and Problem Solving | Entrepreneurship Class 11 - Commerce PDF Download

Q.1. Answer each of these questions in about fifteen words:

(i) Name any two institutions involved in Entrepreneurship Development program.

The following are the institutions contributing to the Entrepreneurship Development program a.k.a. EDP

• CEI: Centre for Entrepreneurship and Innovation
• EDII: Entrepreneurship Development Institution of India 
• IIE: Indian Institute for Entrepreneurship 
• NAYE: National Alliances of Young Entrepreneur. This is now renamed as FISME – Federation of Indian Micro and Small & Medium Enterprises 
• NIESBUD: National Institute for Entrepreneurship and Small Business Development 
• NIMSME: National Institute for Micro, Small and Medium Enterprises 
• NSIC: National Small Industries Corporation 
• REDI: Rural Entrepreneurship Development Institute
• SIDO: Small Industries Development Organization 
• SISI: Small Industries Service Institutions 
• TDC: Training and Development Center

(ii) Who is a social entrepreneur?

Roger L Martin and Sally Osberg defined the social entrepreneur as Social entrepreneur is the one who aims for value in the form of large-scale transformation benefit that accrues either to a significant segment of society or to society at large. Usually the population which is

• under-served
• neglected
• or highly disadvantaged 

do not have financial resources or political influence to achieve the transformational benefit on its own. Social entrepreneurs put all their efforts to help this population to achieve their transformational benefit.

(iii) What are insurable risks?

Insurable risks are those risks which conform to the specifications mentioned by various insurance policies. It is possible to forecast these risks. Through various measures the probability of these risks can be determined. Few examples of insurable risks are those related to life and property against fire, storm, riots, theft, fidelity by dishonest employees etc.

(iv) What are non-insurable risks?

The risks for which it is not possible to determine their probability are called non-insurable risks. Due to this reason it is not possible to forecast these risks. Few examples of non-insurable risks are those related to war, floods, earthquake, gambling, fluctuations in demand, fluctuations in price etc.

(v) What is economic barrier?

For entrepreneurial growth we need the following factors to be available in abundance. 

• Money
• Manpower
• Materials 
• Market 
• Land 

Non availability of these factors to the required levels is economic barrier.

(vi) Give an example of a social entrepreneur

Vinoba Bhave is a social entrepreneur who founded and led the Bhudaan Andolan (Land Gift movement). His movement led to significant land reforms. Around 7 million acres of land was redistribute among the landless poor and untouchables.

Q.2. Answer each of these questions in about fifty words:

(i) What is business incubation?

Business incubation refers to the programs designed by the organizations to help the entrepreneurial organizations. The management of the incubators help these budding enterprises by supplying them the required service and resources. They also provide the required support.
Some of the services and resources are 

• Finance 
• Coaching, training, mentoring 
• Physical space 
• Networking with others 
• Common services 

These incubator vary depending on 

• the enterprises they support 
• their organizational structure
• type of service and support they provide

(ii) Explain business intelligence.

Business intelligence refers to the capability of organizations to

• gather 
• maintain
• and organize information. 

The information thus gathered is quantified and analyzed to derive new potential business opportunities. Once these opportunities are identified, effective strategies are prepared to implement them. This helps the business to

• Enhance the decision making process
• stay up to date in the market 
• sustain the competition 
• Improve the performance and productivity 
• risk mitigation 
• create new business opportunities 
• attain business stability in the coming days

(iii) List two examples of incubation centres in India.

The following are the prime business incubators in India:

• AngelPrime 
• CIIE: Centre for Innovation, Incubation and Entrepreneurship, IIM, Ahmedabad 
• IAN: Indian Angel Network
• NSRCEL: N S Raghavan Centre for Entrepreneurial Learning, IIM, Bangalore
• SINE: Innovation and Entrepreneurship, IIT Mumbai
• T-TBI: Technopark Technology Business Incubator, Kerala
• Villgro

(iv) Write about any two innovations which led to entrepreneurial ventures.

• Penicillin: Penicillin was innovated by the scientist Sir Alexander Fleming and it led to a successful business venture. He was trying to innovate a wonder drug that could cure all the diseases. One day he threw all his experiments. Later he found that a mold contained in a contaminated Petri dish was dissolving all the bacteria in its surroundings. He then experimented with the mold and found that it has a highly efficient antibiotic. He named it as Penicillin. The sale of Penicillin brought about successful business ventures.
• Pacemaker: Pacemaker was invented by an electrical engineer John Hopps. He was doing research on hypothermia. He experiments were focused on restoring the body temperature using radio frequency. When he was conducting the experiments, he discovered that when the heart beating is affected by cooling, the heart beat can be restored by inducing artificial simulation. The idea led him to innovate the pacemaker. It became a successful business venture.

(v) Differentiate between social entrepreneurship and entrepreneurship

Differentiation between the social entrepreneurship and entrepreneurship are summarised in the following table:

Q.3. Answer each of these questions in about 75 words:

(i) What is cloud computing?

Cloud Computing refers to the networks used in computer and communication systems. It got its name as these networks are represented by the clouds in the drawings. Cloud computing is synchronously used for internet.
In cloud computing, the organizations upload all the data and software on to a cloud network. The users can access this data and software remotely. These users can access high configuration computers in a time sharing manner. They can run various algorithms on the cloud network which will provide optimum use of the applications, infrastructure and platform. This is achieved through prioritized access to the CPU. This will also ensure that the user achieves high efficiency.

(ii) How did KFC begin its operations?

KFC was started in Corby, Kentucky, USA by Sanders. He was operating a gas service station. He noticed that the travelers visiting his service station were hungry and looking for some eatables. Sanders knew a secret blend of 11 herbs and spices with which he can prepare tasteful chicken recipe. He started to serve this recipe to the travelers. This recipe became a bit hit and to cope up the demand he started a restaurant. This lead to the inception of “KFC-Kentucky Fried Chicken”.

(iii) Explain the various external factors which lead to business risk.

The following are the various external factors which lead to business risk:

• Economic factors: Economic factors like
  (a) Changes in the consumer preferences and tastes
  (b) Changes in income levels
  (c) Changes in Output
  (d) Changes in trade cycles
  (e) Demand fluctuations
  (f) Increased competition
  (g) Inflation levels
  (h) Price fluctuations
  (i) Variations in world economy
• Natural factors: Natural calamities like
  (a) Cyclones
  (b) Tornadoes
  (c) Lightning
  (d) Floods
  (e) Famine
  (f) Earthquake
  (g) Tsunami
  (h) Valcanos will adversely affect the business and pose big risk. 
• Political factors: This includes
  (a) Change in the government
  (b) Communal clashes or riots
  (c) Civil wars.
  (d) Hostilities with the neighboring countries
  (e) Changes in the government policies
• Changes in the consumer preferences and tastes: This will have a huge impact on the demand for the product or service.

(iv) Enumerate three ways as to how incubators help start-ups get funding?

The incubators can help a budding entrepreneur to get benefited from the following sources:

• Angel Investors: The incubators help the entrepreneurs connect with the angel investors, there by procuring the funds. 
• Banks: They guide the enterprises through the loan procurement process.
• Venture capitalists: They work with the enterprises to prepare effective venture capital presentations. This in turn help the enterprises to get noticed by the venture capitalists and there by getting the required funds.
• Government agencies: They educate the enterprises about various grant programs available from the government agencies to promote the enterprises. For example the incubators help entrepreneurs to take advantage of the programs like Technology NZ, NZTE etc.

Q.4. Answer each of these questions in about 150 words:

(i) Explain the various internal factors which lead to business risk.

The following are the various factors responsible for internal risks:

• Human Factors
  (a) accidents or deaths in the industry
  (b) bad debts
  (c) Continuous lock-outs and strikes by the employee unions
  (d) disloyalty by employees
  (e) Efficient suppliers are not available
  (f) Few or more incompetent people in top level positions
• Technological factors: Rapid changes in the technology. If the competitors are using the most recent technology, they will be able to produce much better quality products or services. This poses the risk of losing the market to the competitors.
• Physical factors: This may include
  (a) Any fire or accident
  (b) Burglary or Theft
  (c) Compensations to be paid to others, in the instances when the enterprise is responsible for any damage caused
  (d) Damages in transit
  (e) Equipment breakdown

(ii) Explain in detail the personal barriers.

When we analyze the society, there are only a small fraction of persons who would like to avail the entrepreneurial opportunities and become entrepreneurs. Whether it is a developing countries like India or highly developed countries like USA, the mindset of people towards the entrepreneurship is the same. Very few people establish an enterprise and the other opt for a different career. This is majorly due to two kinds of personal barriers preventing them from becoming an entrepreneur.
The two varieties of personal barriers are described below:

• Perpetual: The perpetual barriers result in slowing down the growth of an entrepreneur and demotivates them. When people tackle a given situation without clear vision or they completely understand the situation wrongly and take a decision as per their understanding, they fail. This results in a negative perception. As a result they develop their own, often false, beliefs and prejudices about a business activity. This will leave them with a very small range of choices. For instance a person assuming that a particular type of business is suitable only for a particular segment will leave him with fewer choices.
• Motivational: An entrepreneur should consistently be motivated. They should not lose motivation because of any difficulties. This will become a barrier to their development and there by deviate them from their goal of establishing an enterprise. Many entrepreneurs feel demotivated when they encounter prolonged hurdles in a give situation. For instance, delay in procuring license for setting up an enterprise might result in a loss of enthusiasm in an entrepreneur.

(iii) Explain
(a) Smart Mobility
(b) Information Collection as new business forms

(a) Mobile devices like smart phone help the businesses to run their operations smoothly and more efficiently. They improve the speed and accuracy of communication among people. These devices are widely adopted by the public and became a basic need. A report from a survey conducted by IDC (International Data Corporation) showed that the number of smart phones purchased by people have exceeded the number PCs sold in the fourth quarter of 2010. As of today, smart phones surpass the desktops and laptops in the usage of internet. These statistics provide new opportunities and result in new players emerging to cater the growing smart phone market and exploit it completely. The existing enterprises have to dispose their legacy systems and then adopt to this new technology. However, the upcoming enterprises, as they are starting from scratch, should be able to better implement new technologies and get benefited with this new are of opportunities. An example of this new technology wearable gadgets like a smart watch which is connected the smart phone or a Smart phone which can connect and operate various home appliances like refrigerator, washing machine etc.
(b) The enterprises gather the consumer details and study the consumer behavior and preferences. They use this data to ensure that their products or services are providing consumer satisfaction. This helps the enterprises to win consumer confidence. It also helps them to keep themselves ahead of competition. For instance, a retail store can study the consumer details and find that their customers are mostly college students in the age group of 15 to 18 years. This helps them to ensure that their store is equipped with the products that is mostly purchased by this age group.
With the technological advancements, various organizations started to employ different methods by using built-in sensors, social networking sites like facebook, google plus, Instagram, Whatsapp, email to gather the consumer related metrics. A report from a survey conducted by IDC (International Data Corporation) showed that the data collected like this will grow tremendously by 2020. As per an estimate this data will require 44 times more storage space as compared to the data collected in 2009.
One such method used to gather data is by using telemetric operations. Telemetric operations are similar to GPS (Global positioning system). It will allow enterprises to gather and store the data using telecommunication equipment that can control remote objects. The telemetric operations were originally developed for use in the healthcare industry and to gather medical informatics, it is most widely used in the automobile sector.

Q.5. Answer each of these questions in about 250 words:

(i) Enumerate the characteristics of social entrepreneurs.

The following is the enumeration of the characteristics of social entrepreneurs:

• Accountable: They feel accountable about the people they are serving. They always seek feedback of the impact of their actions on the people they are working with. So, they always think about the impact their actions on their beneficiaries. Simultaneously, they feel accountable to the investors as the investors are concerned about the impact the social entrepreneurs are making on the society and see whether the proposed social changes are taking place or not.
• Socially aware: The primary goal of social entrepreneurs is the social improvement. They are not concerned about the profit generation. They feel successful when their efforts are bringing the required social improvement but not because of the monetary profitability. 
• Social Catalysts: They have a vision to bring about the social improvement by changing the prevailing social systems. As mentioned by J. Gregory Dees, the social improvement brought by the social entrepreneurs will not just improve the society in their vicinity but it will trigger a movement to trigger this change all over the world. Whether the area of reformation is that of arts, economic reform, education, environment, health care or any other social field, it act as a catalyst and spread the movement.
• Opportunity-Seeking: They pursue their goal persistently and mould the hurdles into opportunities to nurture and refine their business.
• Innovative: Innovate creative solutions to the problems. They are not shaken up by a fall back but they learn from failures and improve continuously.

(ii) Explain in detail three new forms of business which is created because of technological changes.

With the advancements in the technology, new businesses that tap the potential of these technologies are emerging in the market.

• Businesses specialized in Business Intelligence aspects: Business intelligence refers to the capability of organizations to
  (a) gather
  (b) maintain
  (c) and organize information.
  The information thus gathered is quantified and analyzed to derive new potential business opportunities. Once these opportunities are identified, effective strategies are prepared to implement them. This helps the business to
  (a) Enhance the decision making process
  (b) stay up to date in the market
  (c) sustain the competition
  (d) Improve the performance and productivity
  (e) risk mitigation
  (f) create new business opportunities
  (g) attain business stability in the coming days
• Businesses specialized in Information Collection: The enterprises gather the consumer details and study the consumer behavior and preferences. They use this data to ensure that their products or services are providing consumer satisfaction. This helps the enterprises to win consumer confidence. It also helps them to keep themselves ahead of competition. For instance, a retail store can study the consumer details and find that their customers are mostly college students in the age group of 15 to 18 years. This helps them to ensure that their store is equipped with the products that is mostly purchased by this age group.
  With the technological advancements, various organizations started to employ different methods by using built-in sensors, social networking sites like facebook, google plus, Instagram, Whatsapp, email to gather the consumer related metrics. A report from a survey conducted by IDC (International Data Corporation)showed that the data collected like this will grow tremendously by 2020. As per an estimate this data will require 44 times more storage space as compared to the data collected in 2009.
  One such method used to gather data is by using telemetric operations. Telemetric operations are similar to GPS (Global positioning system). It will allow enterprises to gather and store the data using telecommunication equipment that can control remote objects. The telemetric operations were originally developed for use in the healthcare industry and to gather medical informatics, it is most widely used in the automobile sector.
• Businesses specialized in Smart Mobility: Mobile devices like smart phone help the businesses to run their operations smoothly and more efficiently. They improve the speed and accuracy of communication among people. These devices are widely adopted by the public and became a basic need. A report from a survey conducted by IDC (International Data Corporation) showed that the number of smart phones purchased by people have exceeded the number PCs sold in the fourth quarter of 2010. As of today, smart phones surpass the desktops and laptops in the usage of internet. These statistics provide new opportunities and result in new players emerging to cater the growing smart phone market and exploit it completely. The existing enterprises have to dispose their legacy systems and then adopt to this new technology. However, the upcoming enterprises, as they are starting from scratch, should be able to better implement new technologies and get benefited with this new are of opportunities. An example of this new technology wearable gadgets like a smart watch which is connected the smart phone or a Smart phone with an edge display.
• Businesses specialized in Cloud Computing: Cloud computing refers to the networks used in computer and communication systems. It got its name as these networks are represented by the clouds in the drawings. Cloud computing is synchronously used for internet. In cloud computing, the organizations upload all the data and software on to a cloud network. The users can access this data and software remotely. These users can access high configuration computers in a time sharing manner. They can run various algorithms on the cloud network which will provide optimum use of the applications, infrastructure and platform. This is achieved through prioritized access to the CPU. This will also ensure that the user achieves high efficiency.
• Businesses specialized in social media: As internet became more affordable, several socializing networks like Whatsapp, Facebook, Twitter, Google Hangouts are becoming more popular. Though they were limited to the desktop users earlier, with the advancement of smart mobile devices like smart phones, tablets, e-book readers, the use of social networking became more popular. Companies started to tap the power of these platforms. They help the organizations to study the behaviour of the user and direct their marketing efforts to these users. New business also emerged that will tap the power of these networks and help other organizations to better reach their targeted consumers through the powerful social media.

Q.6. HOTS: (High Order Thinking)
Application-based exercise: Explain the success story of Lijjat Papad.

Six Gujarati women started Shri Mahila Griha Udyok Lijjat Papad in Bombay (present Mumbai). Their purpose was to create a revenue stream through a food product.
They took a loan of Rs.80/- from Chhaganlal Karamsi Parekh. They acquired a papad venture run by Lakshmidas bhai, as it was running in losses. Their policy not to take any donation or help from others even if the business goes bankrupted. They started production on their terrace on 15th March, 1959. The first output was 4 packets. The output was sold to a buyer in Bhuleshwar. They were initially making papads in a low and high quality. As suggested by their adviser, Chhaganlal Karamsi Parekh, they started to make only high quality papads.
The enterprise started to grow as a cooperative system. Though they recruited all age groups initially, they imposed 18 years as the age limit, later on. Within a quarter they had 25 members. As the profits grew, they procured other infrastructure like storage equipment, utensils, cooking equipment etc. The problems like not being able to dry the papads due to rains were resolved by procuring papad drying equipment. After one year the business earned good profits. They popularity and the members started to grow. After 3 years, they had 300 members. This brought up space issues. So, they asked the members to take the raw material to home, prepare papads and bring them back. If the quality was low members were given a warning. If it repeats they were terminated from membership.
As the number of branches increased and they employed other administrative staff like accountants etc at each branch. Currently, they have thousands of members across Maharashra and Gujarat. The profits or losses were equally distributed/born by all the members. The share is decided by a committee of 21 members.
Lijjat papad became a successful venture in India and started to export papads to foreign countries too.