An Analyses of Entrepreneurs and Promotion of Undertakings


By

Dr. Arun Kumar Singhal
Professor
MIMT, Greater Noida
 


ABSTRACT:

In this study researcher found, whether there is any relationship between educational background of entrepreneurs and nature of enterprise promoted, occupational background of entrepreneurs and nature of enterprise promoted, and among the educational and occupational background of entrepreneurs and nature of enterprise promoted, when all taken together. Researcher observed and found in most of the cases educational background are not directly linked with the promotion of units. Therefore, it gives low relationship among the three constituent taken together. Even though there is high relationship between the occupational background and nature of units promoted.
Study shows experience has more bearing than educational qualification of the entrepreneurs on choice of an industrial area. Entrepreneurs under the study undertook the project in which they have very good work experience, even though they had educational specialization in other industrial areas.

Key Words:
Entrepreneur, Educational Background, Occupational Background, Manufacturing Activities, Raw Materials, Enterprise
------------------------------------------------------------------------------------------------------

1. INTRODUCTION

The study is restricted to those units which have been promoted by new entrepreneurs as per our definition. The study covered in all 125 public limited companies engaged in manufacturing and incorporated between April, 1, 2001 to March 3Ist,2010. Of these 97 companies belong to the joint sector. The study excludes units engaged in servicing, electricity generation, hotels etc.

2. Research Methodology

The study is based on the educational background, occupational background of the entrepreneurs and nature of units promoted severally or when all the three constituent taken together. Primary and Secondary data have been used in research. Primary data have been collected for research through questionnaire which had been sent to the entrepreneurs who promoted units in different areas.

Period of study is limited to 1-4-2001 to 31-3-2010.

3. Method of Analysis

The researcher found, whether there is any relationship between:

(1) Qualification of entrepreneurs and nature of enterprises promoted,
(2) Occupational background of entrepreneurs and nature of enterprises promoted, and
(3) Among the educational qualification, occupational background and nature of enterprises promoted, all taken together.

The study has been made over a period of time ranging from 2001-02 to 2009-2010.

Table no. 1: Relationship between educational background of entrepreneurs and nature of enterprise promoted:

Educational
Background

2001-02 to 2004-05

2005-06 to 2009-10

Total no. of  Entrepreneur s  

Direct Relatio- nship

Indirect
Relation
-ship

No Relati-on ship

Total
no. of 
Entrepre
-neurs  

Direct Relatio-ns hip

Indirect Relation-s hip

No Relati-ons hip

1

2

3

4

5

6

7

8

9

Technical Qualifications:
Ph.Ds.
Post-graduates
Graduates

Professional
Qualifications:
MBA
CA
LL.B
MBBS

Post Graduation in:
Arts
Science
Commerce

Graduation in:
Arts
Science
Commerce

Under Graduates



1
2
6




1
2
1



3
2



9
4
3

9




1
2
2






4



1






2




4
3











2
1



3




9



9



4
6
23




5
2
3




5
3


13
7
6

5



4
6
13












2



1





10




5
2






1



6
6












3




5



13



5

 

43

5

14

24

82

26

30

26


Source: Questionnaire and interviews.

Table no. 1 shows the direct and indirect relationship between the educational qualifications of the entrepreneurs and the nature of units promoted.

Educational qualification and nature of enterprises were considered directly related if the entrepreneurs possessed either technical qualification in the same line of graduation and post graduation in science relevant for the manufacturing activity entered in to educational qualifications, which did not have clear cut relationship with manufacturing, but otherwise useful in the manufacturing activities such as graduation and post graduation in science, commerce, business administration and technical qualifications from non related branch of engineers and chartered accountancy was considered indirectly related. Rest of the promoters were put under 'no relationship' category, which shows that educational qualifications had no impact on the choice of the enterprise.

Only 15% entrepreneurs were having direct relationship with the nature of enterprises promoted during the year 2001s.All these entrepreneurs possessed technical qualifications in different branches of engineering.

About 29% entrepreneurs were having indirect relationship with nature of units promoted which again included technical and professional qualifications substantial numbers.

In majority of the cases (56%),educational qualification had no relationship with the nature of enterprises promoted. During the 2004s about 50% entrepreneurs selected their enterprises, more or less, in the fields of their specializations. There may be the reasons, that is about one-third cases(28%), educational qualifications had "direct" relationship with the nature of enterprises.

In another 40% cases, these two were indirectly related and the remaining 32% cases had no relationship. In this period, two post graduate and one graduate entrepreneurs from science disciplines went for the manufacturing of the products in their own areas besides technically qualified persons. Thus it is clear that except technical qualifications, no other branch of education has major impact on the selection of the product for manufacturing.

Most of the entrepreneurs engaged earlier as business executives, consultants, traders Or merchants have promoted enterprises in their respective areas of working. In case of others entrepreneurs in respect of service, contracts, law and medical professions occupational experience was not found much relevant in the selection of enterprises.

However, there were other factors also behind the selection of an enterprise where occupational experience was not related with the nature enterprises promoted. For example: persons engaged in agriculture and related activities went for paper and textile units which were based on agricultural products. Likewise entrepreneurs who in any way connected with state government and SIDCs, got the idea of a particular project from these sources. In case of joint sector projects, it was a choice of the SIDCs for the product and hence entrepreneurs participated sometimes in these projects even, when they had no previous experience. In some other cases where, main promoters had no prior related experience, other promoters in the group helped in the selection of an enterprise. Such entrepreneurs possessed related experience by way of trading consultancy or employment as business executives.

Table no. 2: Relationship between occupational background of entrepreneurs and nature of enterprise promoted:

Educational
Background

2001-02 to 2004-05

2005-06 to 2009-10

Total no. of  Entrep reneur s  

Direct Relatio -nship

Indirect Relation- ship

No Relati- onship

Total no. of  Entrepre -neurs  

Direct Relatio -nship

Indirect Relation- ship

No Relati-on ship

1

2

3

4

5

6

7

8

9

Government Services:
Military
Civil

Business Executives:
Professionals
Engineers/ Consultants
Teachers/ Professors
Others

Business and related activities:
Traders/ Merchants
Contractors
Others

Agriculture and related activities


2



8
3
1
2



18
2
5

2






4
3





7
1






4






11


2





1
2




1
5

2


2
3


26
6
3
2



25
8
3

4



1


20
5
3




18
3






6
1

1



7


2
2





1




8


4

Total

43

15

15

13

82

50

15

17


Source: Questionnaire and interviews

Table no. 2 shows the relationship between occupational background of entrepreneurs and nature of their enterprises.

A relationship has been regarded as direct, if the entrepreneur has entered in to a manufacturing of which he had an experience either as trader or merchant, or as business executives consultant etc. There exits in direct relationship, if the entrepreneurs were engaged in any kind of trading or if they were working as business executives, consultants in non-related fields (example, a trader or business executive or consultant in the field of chemicals promotes enterprise in the field of iron, steal and metels or paper or machinery and accessories). Rest of the cases like contracting (civil) and real estate businesses, military services, law and medical professions etc., were put under no relationship category.

It can be inferred from the foregoing table that during the 2001s in nearly 35% cases (15 units), occupational backgrounds of entrepreneurs were directly related to the nature of enterprises promoted. These included business executives (4), engineers or consultants(3) traders or merchants(2) and contractors(1), one civil contractor went for the manufacturing of  prefabricated building material like sand, cement, bricks etc. In another 35% of the cases these two were indirectly related and the rest of 30% cases had no relationship.

During the 2004s, in most of the cases the background of the entrepreneurs was directly related with the nature of enterprises (61%). There was an indirect relationship in about 18% of the cases and in the case of 21% units, there was no relation between the two. Direct relationship has been seen not only in trade or business but also in some of the services, professions employment etc.For example, a person from civil service category was handling the cases of engineering industries under the union ministry of commerce and industry and therefore possessed and experience of engineering units from the process of licensing to the production and exports. After about, 15 years experience in his job, he left the service and established and an enterprise of the manufacturing of machinery and accessories. Likewise three professors and research experienced in different technical field, had worked in some going concerns during their studies. They acquired knowledge about technologies, problems of production and markets of these products (one chemical and two wood products) and established their enterprises in those areas. Thus in majority of the cases, entrepreneurs have selected different enterprises more or less depending upon their nature of work handled before such promotion. It can also be deduced from the above discussion that against low relationship between educational qualification and the nature of enterprises promoted, there exist better relationship between the occupational background of the entrepreneurs and the nature of enterprises promoted. It means that occupational experience is an important guiding factor than the educational qualification in the choice of enterprise.

After examining the relationship between the educational qualification and nature of the enterprises promoted and occupational background or experienced and nature of enterprises promoted. The researcher analyzed the relationship among the three constituents taken together.

Table no. 3: Relationship among educational and occupational background of entrepreneurs and nature of enterprise promoted: 2001-2002 to 2009-2010

Nature of Enterprises

Total no. of  Entrepren eurs  

No. of Entrepreneurs having directly or indirectly related educational and occupational experience

Total no. of  Entrepreneurs  

No. of Entrepreneurs having directly or indirectly related educational and occupational experience

1

2

3

4

5

Chemical and chemical
products
Leather and leather products
Rubber. Plastics and Glass
Paper and Paper Products
Wood Products
Textiles and Synthetics
Electrical Machinery and
appliances
Machinery and Accessories
Iron, Steel and Metals
Miscellaneous


2
2
1
1
8
7

12
6
4







4

4
2
1


12
5
4
14
4
8

2
7
17
9


2
2
2
5
2
3

1
1
12
4

 

43

11

82

34


Source: Questionnaire and interviews.

Table no. 3 shows the relationship among the three constituents considered simultaneously.
 

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Source: E-mail July 27, 2011

          

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