MODULE-2

Role of Business Enterprise and Entrepreneurship

• Business activities play a crucial role in the economy by meeting consumer needs and creating jobs.

• Entrepreneurs identify opportunities and innovate within the market.

Objectives

• Identify the purpose of business activity.

• Differentiate types of management skills.

• Understand steps to manage a business.

• Explain the nature of business management.

• Enumerate steps to success.

• Know necessary abilities to run a business.

Entrepreneurs

• Spot market opportunities.

• Develop new ideas by combining resources.

Purpose of Business Activity

• Produce goods or provide services to make a profit.

• Meet customer demand at acceptable prices.

Goods vs Services

Goods

• Tangible items that can be stored.

• Examples: Computers, food, clothes.

Services

• Intangible actions that cannot be stored.

• Examples: Hairdressing, train journeys, internet access.

Meeting Market Needs

• Businesses fulfill specific customer needs that are currently unaddressed.

• Entrepreneurs launch businesses based on market demand.

Business Idea Development

• Adaptation and innovation are essential for keeping pace with market trends and technology.

Original Ideas

• Invention: Creating something entirely new.

• Innovation: Successful commercialization and improvement of existing products.

Adaptation

• Altering existing products/services to suit different customers.

• Less risky compared to inventing something new.

• Example: A restaurant expanding its menu offerings.

Customer Needs and Wants

Needs

• Essential for survival: clothing, food, shelter.

Wants

• Desirable but not essential: event tickets, designer items, holidays.

Succession Planning

• Vital for ensuring business continuity by developing future leadership.

• Strategy for identifying talent at all company levels.

Tips for Succession Planning

1. Be proactive with a plan.

2. Identify succession candidates.

3. Communicate with candidates.

4. Enhance professional development.

5. Test the succession plan.

6. Integrate with hiring strategies.

7. Consider your successor.

Managing a Business

• Requires diverse skills and effective application.

• Goal setting and monitoring productivity aids effective management.

Office Management

• Handling office affairs is crucial to productivity.

Time Management

• Prioritize tasks and monitor schedules to ensure effective operations.

Task Delegation

• Enables managers to focus on higher-level responsibilities.

• Responsibility for task completion remains with managers.

Leadership in Management

• Essential for guiding the organization, managing conflict, and fostering trust.

Key Abilities for Business

1. Creativity: Essential for idea generation.

2. Entrepreneurial Spirit: Determination and commitment.

3. Personal Traits: Decision-making, interpersonal, communication skills.

4. Marketing Skills: Essential for reaching target markets.

5. Management Skills: Stress management, adaptability, financial oversight.

Types of Management Skills

People Skills

• Strong interpersonal skills are essential for team dynamics.

Time Management

• Prioritize and set goals effectively.

Project Management

• Organizational skills and knowledge of processes.

Conflict Management

• Negotiation and listening skills are vital for resolution.

Other Skills

• Stress management and office management for operational efficiency.

Activities

1. Compare invention, innovation, and adaptation.

2. Differentiate between needs and wants.

3. Discuss the importance of succession planning.

4. Identify the most crucial personal ability for business management.