A sole proprietorship (In Hindi), also known as the sole trader or simply a proprietorship, is a type of enterprise. That is owned and run by one natural person and in which there is no legal distinction between the owner and the business entity. The owner is in direct control of all elements and is legally accountable for the finances of such business and this may include debts, loans, loss, etc. Also learn,What is Manpower Planning? Example, with Importance.
Learn and Study, What is Sole Proprietorship? Meaning and Definition.
A sole proprietor may use a trading name or business name other than his, her, or its legal name. They may have to legally trademark their business name if it differs from their own legal name. The process varying depending upon the country of residence. The sole trader receives all profits (subject to taxation specific to the business) and has unlimited responsibility for all losses and debts. The proprietor owns every asset of the business, and all debts of the business are the proprietors. It is a “sole” proprietorship in contrast with partnerships (which have at least two owners).
Meaning of Sole Proprietorship:
A sole proprietorship, also known as a sole trader or a proprietorship, is an unincorporated business with a single owner. Who pays personal income tax on profits earned from the business. With little government regulation, a sole proprietorship is the simplest business to set up or take apart. Making sole proprietorships popular among individual self-contractors, consultants, or small business owners. Many sole proprietors do business under their own names because creating a separate business or trade name isn’t necessary. Alsolearn the Definition, Importance, and Affected Factors of Manpower Planning.
Definition of Sole Proprietorship:
Simplest, oldest, and most common form of business ownership in which only one individual acquires. All the benefits and risks of running an enterprise. In a sole-proprietorship. There is no legal distinction between the assets and liabilities of a business and those of its owner. It is by far the most popular business structure for startups because of its ease of formation. Least record-keeping, minimal regulatory controls, and avoidance of double taxation.
Also, A sole proprietorship is an unincorporated business owned by one individual, making it the simplest form of business to start and operate. Over 20 million sole proprietorships are operating in the United States and Canada, making it by far the most popular form of business ownership.
The key feature of the sole proprietorship definition is that unlike an incorporated business or a partnership there is no legal separation between the business and the owner in a sole proprietorship – the business is considering to be an extension of the owner and as such the owner is personally responsible for any debts or liabilities incurred by the business.
An Example of a Sole Proprietorship:
Most small businesses start as sole proprietorships and change to different legal structures as they grow. For example, in 2005, Kate Schade started her company, Kate’s Real Food, as a sole proprietor. The company creates and sells energy bars, and it began as a local vendor in Schade’s town of Victor, Idaho. The sole proprietorship sold its energy bars at local farmer’s markets and then expanded to sell online and to a few accounts in Jackson, Idaho.
Personal liability for business debts:
A sole proprietor can hold personally liable for any business-related obligation. This means that if your business doesn’t pay a supplier, defaults on a debt, or loses a lawsuit, the creditor can legally come after your house or other possessions.
Examples:
Example 1: Lester is the owner of a small manufacturing business. When business prospects look good, he orders $50,000 worth of supplies and uses them in creating merchandise. Unfortunately, there’s a sudden drop in demand for his products, and Lester can’t sell the items he’s produced. When the company that sold Lester the suppliers demand payment, he can’t pay the bill. As the sole proprietor, Lester is personally liable for this business obligation. This means that the creditor can sue him and go after not only Lester’s business assets but his other property as well. This can include his house, his car, and his personal bank account.
Example 2: Shirley is the owner of a flower shop. One day Roger, one of Shirley’s employees, is delivering flowers using a truck owned by the business. Roger strikes and seriously injures a pedestrian. The injured pedestrian sues Roger, claiming that he drove carelessly and caused the accident. The lawsuit names Shirley as a co-defendant. After a trial, the jury returns a large verdict against Roger and Shirley as the owner of the business. Shirley is personally liable to the injured pedestrian. This means the pedestrian can go after all of Shirley’s assets, business, and personal.
By contrast, the law provides owners of corporations and limited liability companies (LLCs) with what’s called “limited personal liability” for business obligations. This means that, unlike sole proprietors and general partners, owners of corporations and LLCs can normally keep their house, investments, and other personal property even if their business fails. If you will engage in a risky business, you may want to consider forming a corporation or an LLC. You can learn more about limiting your personal liability for business obligations by reading Nolo’s articles on corporations and LLCs.
Registering your sole proprietorship:
Unlike an LLC or a corporation, you generally don’t have to file any special forms or pay any fees to start working as a sole proprietor. All you have to do is declare your business to be a sole proprietorship when you complete the general registration requirements that apply to all new businesses. Also, learn the advantages anddisadvantages of the sole proprietorship.
Most cities and many counties require businesses, even tiny home-based sole proprietorships, to register with them and pay at least a minimum tax. In return, your business will receive a business license or tax registration certificate. You may also have to obtain an employer identification number from the IRS, a seller’s permit from your state, and a zoning permit from your local planning board.
Also, And if you do business under a name different from your own, such as Custom Coding, you usually must register that name, known as a fictitious business name, with your county. In practice, lots of businesses are small enough to get away with ignoring these requirements. But if you are caught, you may be subject to back taxes and other penalties.
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Entrepreneurial culture; According to Christopher Rea and Nicolai Volland, cultural entrepreneurship is “practices of individual and collective agency characterizing by mobility between cultural professions and modes of cultural production”, which refers to creative industry activities and sectors. Also learn, Intrapreneurs Inside an Entrepreneurs, this article explains to Creating an Entrepreneurial Culture.
Learn and Understand, The question How to Creating an Entrepreneurial Culture? are Explain.
Rea and Volland identify three types of cultural entrepreneur: “cultural personalities”, defines as “individuals who create their own personal brand of creativity as a cultural authority and leverage it to create and sustain various cultural enterprises”; “tycoons”, defined as “entrepreneurs who build substantial clout in the cultural sphere by forging synergies between their industrial, cultural, political, and philanthropic interests”; and “collective enterprises”, organizations which may engage in cultural production for-profit or not-for-profit purposes.
The relatively small amount of intrapreneurs in Latin America is due not to a lack of entrepreneurial initiative within businesses, but rather to a lack of an entrepreneurial culture in businesses. Unentrepreneurial companies are unable to generate an environment that encourages individual initiative among employees and are unlikely to attract entrepreneurial leaders. Intrapreneurs should be able to use their skills and knowledge creatively across different areas, and the company has to create a climate that encourages the development of this type of creativity. Also learn, What is Intrapreneurship? Meaning and Definition!
A business with an entrepreneurial culture is characterized by:
Having a system with information on the needs and opinions of clients.
Being at the forefront of technology and including these advances into their value chain.
Respecting individuals and the ideas that come from “lower down,” as an employee from any level can be a key player in terms of innovation.
Tolerating well-intentioned failures because they are a learning tool, although intrapreneurs must also follow the rules established for the development of new ideas.
Sharing knowledge and not allowing it to just stay within one department.
Encouraging informal networking, as creativity often happens outside of designated frameworks in excessively rigid organization designs.
Creating multi-skilled teams with different outlooks and complementary skills, mirroring what happens in the creation process in independent businesses.
Having a long-term objective, along with the pressures of a short deadline. Management allows new risky projects enough time to prove their viability.
Having available and accessible resources for the development of new projects, even though they may be high risk.
Higher management supports the initiatives and creating the conditions for intrapreneurs to strive in the development of their ideas.
Celebrating internal success. Successful intrapreneurs are the reward and recognize the organization.
An “entrepreneurial” company is one that integrates these characteristics, regardless of the people who are leading the entrepreneurial process. Thereupon, the organizations with an entrepreneurial culture achieve a balance between individual entrepreneurial initiative and a spirit of cooperation. As well as an overall innovative group identity. Thereby, the entrepreneurial culture can penetrate all levels of the organization, and the processes in the search for innovation can continue to strengthen in time.
Few Steps to creating an Entrepreneurial Culture:
Big businesses could drive economic growth and help their employees adopt entrepreneurial behaviors that foster innovation and growth by encouraging a culture of “entrepreneurialism”. The buzzword “intrapreneurs” was coined in the 1980s by management consultant Gifford Pinchot and often uses by organizations that recognize the need for new and innovative ideas.
Unlike entrepreneurs, who tend to run their own small start-up organizations, intrapreneurs usually work in larger organizations. Where they’re tasked with developing new ideas and concepts like an entrepreneur would. There’s no doubt that a successful business depends on innovative ideas and sound market strategy, but good people management is crucial to the long-term success of any business.
According to CIPD research advisor Claire McCartney, who recently authored a report on the issue.
“As start-up companies grow, it can be easy for the entrepreneurial spirit that made it so successful in the first place to wane, but the companies we’ve spoken to have proven that even the largest organizations can retain an innovative edge if they pay close attention to attracting, retaining, engaging and developing the right talent to live and breathe the values of the founders.”
McCartney said the top five secrets to entrepreneurialism success are:
Purposeful profit – It’s okay to care.
Entrepreneurs have a genuine desire to make a sustainable difference to their local communities and beyond and instill these values throughout their organizations. This clearly distances them from the sometimes unacceptable and uncaring face of larger corporates. Also Consider, How to Explain Observing Trends in Entrepreneurship?
One part entrepreneurial = 20 parts reach and impact.
Entrepreneurial organizations are not limited by their size, resource or money. Their entrepreneurial leadership and practices enable them to punch far above their weight. And, by catalyzing with other elements they create more value; clever use of social media, smart networking, and multiple strategic alliances all significantly amplify their impact and reach.
Deep and deliberate co-creation with customers.
Where entrepreneurial organizations really stand out is in their deep co-creation with clients and customers. This involvement goes way beyond simple one-sided communication to active involvement in shaping and even sponsorship of business strategy. They really listen to their customers and draw on their ideas and requirements to keep the business and brand fresh.
Headspace for innovation – support your hidden intrapreneurs.
A common theme across all the organizations involved in this research is the emphasis they place on employee innovation. They do this by supporting intrapreneurs using innovation days and cross-team working. Employees working daily with customers on the front line have the creative sparks or ideas that could really make a difference.
Go forward with failure.
Finally, fear of failure does not stop entrepreneurial organizations from doing things differently and innovating. In fact very little, if anything at all, holds back the entrepreneurial leaders and organizations featured in the report. They recognize that in order to create and innovate some failure is inevitable and realize the great potential for learning from mistakes and failures and even publicizing these as part of the learning process.
This is especially true for entrepreneurial companies, where what’s going on in the building of a business as well as a culture. Corporate culture must be led, nurtured, constantly monitored and adjusted. Much like a “culture” in a petri dish, it requires that you combine the right ingredients, in the right way, to ensure. That what you grow is not an aberration of your intentions.
Laying the Groundwork:
When I founded Net Daemons, my computer consulting company, I had very definite ideas of what I wanted to provide for our future employees. A safe and comfortable environment. Which enabled people to learn, grow and, at the same time, focus on their day-to-day work. Also learn Related to another Culture, How to explain Organizational Culture? Meaning and Definition!
From early on, I felt it was important to treat every employee with trust and respect. That meant assuming automatically that each was an honest, hard-working, reliable and dependable individual. Rather than requiring all employees show up at nine and leave at five, for example, I expected each person to do the job assigned, and to apply the right amount of time and quality of skills toward the accomplishment of each task.
While I wasn’t aware, back then, that I was creating what is now considered “corporate culture,” I knew I was looking to create a place of employment. Where employees were at once valued for, who they were and what they brought to the table. This was critical for our business, which sold knowledge and a system of collaboration between some 45 engineers providing network-administration and Internet-development solutions. If a team isn’t in sync, you can’t sell a team approach, and you’re no better than a single consultant.
What Makes a Culture Entrepreneurial?
As one of our engineers once put it, in an entrepreneurial culture, work is more than a job. It’s a lifestyle Employees are more like a team than most companies, and in some cases, we’re even a family.
Lear, What also evolved was a set of rules for creating and maintaining NDA’s petri dish. In creating your own, consider these rules:
Treat people with respect.
This is a very simple premise, which threads through each and every complicated issue that can arise within a company. Respect and trust provide the necessary base for a vibrant and sustainable corporate culture. Also take a look Difference between Leadership and Entrepreneurship!
Help employees stay healthy.
When employees get sick, they miss work, so it makes sense to offer health insurance as a benefit. We covered 100% of employee health plans. I never want an employee to experience a catastrophic illness and not cover by insurance. We also offered unlimited sick time. While I had seen this type of policy backfire elsewhere, it nonetheless allowed people to be sick when they really were sick, and not feel obligated to gobble up each “allotted” sick day. You may also want to add a wellness allowance for health-club membership.
Open doors to communication.
Create an environment where people can interact with each other, support each other and recognize each other’s efforts and achievements. Provide positive rewards for positive behavior. Share information, so that employees are aware of the direction of the company and are involved in it. Use all-hands meetings for financial and operational information, team-building, and social events. Offer incentive programs to reward effort and improve the quality of life.
Build camaraderie.
Make time for people to get to know each other and the company. We held an annual off-site meeting to build team spirit and discuss where the company was going. At such events, you can also distribute and share your business plan and discuss issues and ideas raised by your strategies.
Maintaining Entrepreneurial Culture:
Once you have healthy, trust and inform employees, don’t let the culture that’s evolving just be. It needs to watch so that it grows as you intended. The trick is standing back, but not too far back. In maintaining your culture, consider these rules.
Let the team build itself. Within that safe, comfortable, open environment, let employees grow together without being made to.
Participate without controlling. Let the culture thrive, without your either meddling with it or ignoring it.
Don’t forget the little things. Culture makes up of many small actions. When putting together, create something larger than the sum of the parts. There are many things a CEO can do to make employees feel a part of the company. Some are just common courtesies: hallway conversations, saying “hello” in the morning, opening doors, asking after people’s families and partners. Others are little extras, such as flowers to say thank you and happy-birthday e-mail messages. Eating lunch with employees, helping spouses find jobs and participating in team events show that you, the CEO, are involving with your employees.
Treating employees with respect helps enable them to do their jobs to the best of their abilities. If you challenge people to raise their bars, provide fun activities, keep people informed and humanize your management, you get culture. From these basics, you will grow in your petri dish a strong, healthy culture that will allow you, your company and your employees to flourish.
How to Creating an Entrepreneurial Culture? Also, the Image in Online,
Reference:
1. Creating – //gnp.advancedmanagement.net/article/2017/08/finding-intrapreneurs-inside-your-company 2. Few Steps – //www.insidehr.com.au/5-steps-to-building-an-entrepreneurial-culture/ 3. What Makes – //www.entrepreneurship.org/articles/2001/06/creating-an-entrepreneurial-culture 4. Photo Credit URL – //barrattgalvin.com/wp-content/uploads/2016/06/Regent-st-e1465453837129.jpg
Intrapreneurs is Inside an Entrepreneurs:Intrapreneurship refers to employee initiatives in organizations to undertake something new, without being asked to do so. Hence, the intrapreneur focuses on innovation and creativity and transforms. An idea into a profitable venture, while operating within the organizational environment. Thus, intrapreneurs are Inside entrepreneurs who follow the goal of the organization. Intrapreneurship is an example of motivation through job design, either formally or informally.
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Entrepreneurship essay; Another important concept is the Corporate Social Entrepreneurship. Which is the intrapreneurship within the firm which is driven to produce social capital in addition to economic capital? Also learn, What is Intrapreneur? Meaning and Definition.
Understand by Example:
A classic case of intrapreneurs is that of the founders of Adobe, John Warnock, and Charles Geschke. They both were employees of Xerox. As employees of Xerox, they were frustrated because their new product ideas were not encouraging. They quit Xerox in the early 1980s to begin their own business. Currently, Adobe has an annual turnover of over $6 billion.
Employees or perhaps those engaged in a special project within a larger firm, are encouraged to behave as entrepreneurs, even though they have the resources, capabilities, and security of the larger firm to draw upon. Capturing a little of the dynamic nature of entrepreneurial management (trying things until successful, learning from failures, attempting to conserve resources, etc.) adds to the potential of an otherwise static organization. Without exposing those employees to the risks or accountability normally associated with entrepreneurial failure.
Many companies are famous for setting up internal organizations whose purpose is to promote innovation within their ranks. One of the most well-known is the “Skunk Works” group at Lockheed Martin. The group was originally named after a reference in a cartoon and was first brought together in 1943 to build the P-80 fighter jet. Because the project was to eventually become a part of the war effort, the project was internally protected and secretive. Kelly Johnson, later famous for Kelly’s 14 rules of intrapreneurship, was the director of this group.
Another example could be 3M, who encourage many projects within the company.
They give a certain freedom to employees to create their own projects, and they even give them funds to use for these projects. Genesis Grant is 3M’s intrapreneurial program which finances projects that might not end up getting funds through normal channels. Genesis Grant offers $85,000 to these innovators to carry forward their projects. In the days of its founders, HP used to have similar policies and just such an innovation-friendly atmosphere and intrapreneurial reputation. Besides 3M, Intel also has a tradition of implementing intrapreneurship.
Robbie Bach, J Allard, and the team’s XBOX might not have been feasible without Microsoft’s money and infrastructure. The project required 100’s of millions and quality talent to make the product.
Identifying Intrapreneurs:
Entrepreneurs are not born but are self-made. However, some common psychological traits make them stand out. Such as a strong will to achieve, the ability to take responsibility and risks, and the desire for independence and internal control. Also learn,What is the Difference between Leadership and Entrepreneurship?
Equally, corporate entrepreneurs tend to take initiative, accept challenges, and discover new opportunities for growth for the company that they work for. They look to be leaders and put their ideas into practice. Nevertheless, they have a lesser desire for independence and prefer the security of their work as opposed to the uncertainty of starting up their own company.
Traits intrapreneurs have in common with independent entrepreneurs: Intrapreneurs identify new opportunities for growth for the company. They develop a business model, they form teams, and they present their ideas and projects to the various evaluating committees at the company. Overall, they are aware that their success will depend on their ability to manage their network of internal supporters, namely those people who are higher up in the organization and who support their ideas.
Intrapreneurs can also identify by the following traits:
The main motivation for an intrapreneur is to achieve hierarchical independence and the possibility to move up the reward scheme within the company.
Their time orientation depends on the urgency to meet deadlines set by themselves and by the company.
Their activity is based on direct participation and team leadership instead of delegation and supervision of others.
Instead of carefully managing risks, which is a characteristic of management, intrapreneurs take moderate risks, as if they were independent entrepreneurs.
In terms of status, corporate entrepreneurs are not worried about traditional status symbols; they are looking for independence.
When making decisions, they are not dependent on superiors. They can make others agree with them to achieve their goals.
Unlike a manager, who guides others, an intrapreneur guides themselves, their clients, and their internal stakeholders.
They predominantly establish transactional relationships with others, without being left out of the organization’s hierarchy.
All companies need employees with entrepreneurial instincts, and the challenge for businesses is to include tools in their human resources policy that attract and retain people with these characteristics. Correctly managing these employees’ motivation and competitive edge will stop them from leaving the company. Whether that be to start their own business or to join another company with a more entrepreneurial culture.
How far does intrapreneurship reach?
Even though corporate entrepreneurship encompasses the strategies and practices that companies use to look for new business opportunities via the promotion and management of entrepreneurial competencies, the overall impact of intrapreneurs can see in two ways. Why is the Need Entrepreneurship for Small Business?
On one hand, they may focus on generating new business for companies, or even new companies or spin-off companies. This involves searching for new opportunities to amplify the activities of the company in terms of its related sectors, as well as the development of new products, markets, and technology. They create fresh activities within the organization. Which of course involves a larger risk of failure than the company’s business lines, as well as an overall degree of uncertainty. Firms such as P&G, 3M, Google, and more recently Tesla are clear examples of strong intrapreneurial dynamics and continuous development of new business within the companies.
On the other hand, a strategic renovation can take shape, which can imply a new combination of resources and a full transformation of the company’s foundations, changing it into a different company from what it was before. The process of strategic renovation often includes the redefining of the company’s mission, the creation of a new business model, the reformulation of the competitive base strategies, and the acquisition or generation of new competencies. The success of this process mainly depends on the entrepreneurial instinct similar to what is seen when companies are first created. With a committed entrepreneurial leader who has the same motivation, attitude, and behavior of a traditional independent entrepreneur. Some notable examples of companies in which intrapreneurial leadership has driven relevant strategic renovation are IBM, Xerox, and Lego.
“Don’t Think Intrapreneurs Are Just Like Entrepreneurs”
Most people believe intrapreneurs are simply internal entrepreneurs, and that they should expect to act in the same ways, be driven by the same motivations, and respond similarly to a wide array of circumstances. These are naïve assumptions that, more often than not, will derail intrapreneurship.
So, if that’s not exactly true, what is? We asked Larry Myler, Forbes.com columnist, for advice. Larry strongly advocates intrapreneurship as the highest form of employee engagement. As a serial entrepreneur and intrapreneur expert, he shares four fundamental Intra/entrepreneur disconnects for you to consider if you are serious about implementing intrapreneurship in your organization.
1. Risk/Reward!
Myler observes, “Entrepreneurs willingly sign up for unlimited risk or boundless reward. Not so with intrapreneurs, who take a paycheck from an organization largely to avoid financial risk, and therefore do not expect huge financial gains”.
This is the main psychographic difference between the two, and the reason why motivations (both intrinsic and extrinsic) must carefully align for intrapreneurs.”
Intrapreneurs do take more risks than your average employee and you must reward smart risk-taking. Even though the product was a complete flop, the guys who invented New Coke were given raises and promotions instead of being canned. Why?
Because Coca-Cola executives love that they were forward-thinking and were willing to take a smart, calculated risk, even if it didn’t pay off. During the Intrapreneurship Conference, you’ll get to hear about the rewards systems other companies have adopted for driving intrapreneurship.
2. Autonomy!
“Intrapreneurs by definition are not as autonomous as entrepreneurs, although they’re typically made to believe they are. They are part of a bigger organization with well-establish operations, and that means they inevitably give up some autonomy.”
According to the bureaucratic theory of organization, when everyone does his or her specialized job as directed by the boss. The whole works together and creates value for the customer and the shareholders. This sort of hierarchical coordination once worked well enough. Today, it is increasingly unworkable and become obsolete.
The intrapreneurial challenge is to find the golden path: to firmly grasp a worthwhile dream in one hand and reality on the other. During the Intrapreneurship Conference, we will hear from Noam Wekser, a Member of the Board of Oracle. On the challenge of encouraging intrapreneurial behavior in a bureaucratic classic day-to-day business environment.
3. Resource attainment!
“Entrepreneurs hire marketing, advertising, R&D, design, engineering, and sales services. They call the shots from the vantage point of the boss or customer. Intrapreneurs, however, are employees and have to negotiate for these and other resources, subject to internal availability. The upside for intrapreneurs is that funding is generally offering by the organization, while entrepreneurs struggle to cobble together necessary funding.”
What support can you offer to your intrapreneurial teams? Think of resources, brain-power, assets, and intellectual capital. It makes their job easier, drives collaboration and creativity, but especially makes it more likely they will succeed, moving your business forward.
Mentorship has proven to be one of the most effective; especially when provided by seasoned entrepreneurs. During the Intrapreneurship Conference, you’ll get to know various strategies for implementing such a mentorship program.
4. Culture!
“Entrepreneurs have the luxury of building a company’s culture from scratch. While intrapreneurs fight against a long history of many deeply held and widely. Shared beliefs and assumptions—some of which run counter to intrapreneurship itself.”
Culture – it’s a strange thing. Most innovative companies once in the market, end up following customers’ requests and fail to be able to renew their perspective. This is the classic innovator’s dilemma. Intrapreneurship strategies reveal themselves as very solid ways of quenching these structural and cultural shortcomings. By reconnecting teams that have become risk-averse to the innovation playfield. Philippe Méda will deliver a keynote on this topic.
Intrapreneurs are not just entrepreneurs who happen to work inside an organization. There are some fundamental differences in their motivations, the skills they possess, and the environment they need to thrive. If you want to know how you can implement intrapreneurship in your organization.
How to Intrapreneurs is Inside an Entrepreneurs?
Reference
1. How? – //www.mbaknol.com/modern-management-concepts/what-is-intrapreneurship/ 2. Intrapreneurs Inside Your Company – //gnp.advancedmanagement.net/article/2017/08/finding-intrapreneurs-inside-your-company 3. Just Like – //www.intrapreneurshipconference.com/intrapreneurs-are-not-entrepreneurs/ 4. Photo Credit URL – //www.raconteur.net/wp-content/uploads/2016/09/professional-development-image-Klaus-Vedfelt-Getty-Images.jpg
Identifying Opportunities for Observing Trends; The First approach to identifying opportunities is to observe trends and study how they create opportunities for entrepreneurs to pursue. Also learn, What is the Difference between Leadership and Entrepreneurship? This article explains to the question How to Explain Observing Trends in Entrepreneurship? The most important trends to follow are economic trends, social trends, technological advances, and political action and regulatory changes. As an entrepreneur or potential entrepreneur, it’s important to remain aware of changes in these areas
Learn and understand, Explaining are Observing Trends in Entrepreneurship.
This sentiment affirms by Michael Yang, the founder of Become.com, a comparison shopping site, who believes that keen observation skills and a willingness to stay on top of changing environmental trends are key attributes of successful entrepreneurs: One of the most important attributes of a good entrepreneur is having a keen observation ability. Seeing what’s needed in people’s everyday lives and coming up with innovative new ideas and services that meet those needs . . . I always believe the entrepreneurs that anticipate trends and maintain observations of what’s needed . . . to solve those needs will have a higher chance of succeeding in the marketplace.
When looking at environmental trends to discern new business ideas, there are two caveats to keep in mind. First, it’s important to distinguish between trends and fads. New businesses typically do not have the resources to ramp up fast enough to take advantage of a fad. Second, even though we discuss each trend individually, they are interconnecting and should consider simultaneously when brainstorming new business ideas.
For example, one reason that smartphones are so popular is because they benefit from several trends converging at the same time, including an increasingly mobile population (social trend), the continued miniaturization of electronics (technological trend), and their ability to help users better manage their money via online banking and comparison shopping (economic trend). If any of these trends weren’t present, smartphones wouldn’t be as successful as they are and wouldn’t hold as much continuing promise to be even more successful as is the case.
A summary of the relationship between the environmental factors just mentioned and identifying opportunity gaps. Next, let’s look at how entrepreneurs can study each of these factors to help them spot business, product, and service opportunity gaps. Read more, What are the Participation and Organizational Climate?
Economic Forces:
Understanding economic trends help determine areas that are ripe for new business ideas as well as areas to avoid. When the economy is strong, people have more money to spend and are willing to buy discretionary products and services that enhance their lives. In contrast, when the economy is weak, not only do people have less money to spend, they are typically more reluctant to spend the money they have, fearing the economy may become even worse and that in turn, they might lose their jobs because of a weakening economy.
Paradoxically, a weak economy provides business opportunities for start-ups that help consumers save money. Examples include GasBuddy and GasPriceWatch.com, two companies started to help consumers save money on gasoline. A similar example is e.l.f., a discount retailer of women’s cosmetics. The company (which stands for Eyes Lips Face) sells cosmetics products for as little as $1.00.
First:
A poor or weak economy also provides opportunities for firms to sell upscale and everyday items at a “discount.” For example, daily deal sites like Groupon and LivingSocial have experienced rapid growth by providing consumers’ access to local providers of massages, trips to museums, high-end restaurants, and similar products or services at deep discounts. A similar example is Gilt Groupe, which sells luxury goods at a discount on time-limited sales. Brick-and-mortar retailers are affected by the search for discounts too.
For example, in 2009, Neiman Marcus reported a 14.8 percent drop in sales while Family Dollar experienced a 25 percent increase in revenues. The same mindset is contributing to people wanting the most value for their money, across the spectrum. For example, the recession has caused an upswing in the number of people frequenting local farmers markets, where people can buy locally grown produce, meats, and other food products that are fresher and often cheaper than similar products at the grocery store.
Second:
It’s also important to evaluate how economic forces affect people’s behaviors beyond looking for discounts and the most value for their money. For example, when the economy is weak, more people go back to school; largely as a result of poor employment prospects. This trend provides opportunities not only for traditional and online colleges and universities but for businesses that develop products to assist them.
An example is BenchPrep, the student-initiated business profiled in the opening feature. BenchPrep, which sells Apple iPhone and Android apps that help people prepare for college admission tests, is benefiting from an increase in college enrollments. Similarly, when the economy is poor, more people start businesses. Web-based businesses like Etsy, which provides a platform for people to sell handmade items; thrive when an increasing number of people are looking to open full-time or part-time businesses.
Third:
An understanding of economic trends can also help identify areas to avoid. For example, this is not a good time to start a company that relies on fossil fuels; such as airlines or trucking or perhaps even local transportation-related businesses such as a taxicab company, because of high fuel prices. Certain product categories suffer as a result of economic circumstances. This is not a good time to open a store or franchise that sells premium-priced food products like cookies or ice cream.
Social Forces:
An understanding of the impact of social forces on trends and how they affect the new product, service, and business ideas is a fundamental piece of the opportunity recognition puzzle. Often, the reason that a product or service exists has more to do with satisfying a social need than the more transparent need the product fills. The proliferation of fast-food restaurants, for example, isn’t primarily because of people’s love for fast food but rather because people are busy and often don’t have time to cook their meals.
First Things:
Similarly, social networking sites like Facebook and Twitter aren’t popular because they can use to post information and photos on a Web site. They’re popular because they allow people to connect and communicate with each other, which is a natural human tendency. Changes in social trends alter how people and businesses behave and how they set their priorities. These changes affect how products and services are built and sold. Here is a sample of the social trends that are currently affecting how individuals behave and set their priorities:
Aging of baby boomers,
The increasing diversity of the workforce,
Increasing interest in social networks such as Facebook and Twitter,
The proliferation of mobile phones and mobile phone apps,
An increasing focus on health and wellness,
Emphasis on clean forms of energy including the wind, solar, biofuels, and others,
Increasing the number of people going back to school and/or retraining for new jobs, and
Increasing interest in healthy foods and “green” products.
Each of these trends is providing the impetus for new business ideas. An increasing emphasis on alternative forms of energy is spawning business ideas ranging from solar power to biofuels.
Second Things:
The aging of the baby boomers is creating business opportunities from vision care to tech assistance to senior dating sites. An example is Glaukos, a company that’s developing new approaches for treating glaucoma, which is an age-related eye disorder. There are now 76 million baby boomers (people born between 1946 and 1964) in the United States. Many baby boomers will develop glaucoma and similar age-related ailments. The fact that roughly 10,000 baby boomers in the United States are now retiring daily also creates entrepreneurial opportunities related to social trends associated with this population of senior citizens.
Third Things:
The proliferation of mobile phones and mobile phone apps is a social trend that’s opening business opportunities for entrepreneurs across the globe. For example, both Runkeeper, the focus of Case 1.1, and ScriptPad, the focus of Case 2.1, are mobile phone apps. In the past 10 years, the worldwide penetration of mobile phones has grown from 1 billion to 4 billion active users. One company, PharmaSecure, the focus of the “You Be the VC 2.1” feature, is leveraging this trend to save lives in developing countries. It’s estimated that 10 percent of medications sold worldwide are counterfeit. In India alone, 1 million people a year die from ingesting counterfeit drugs.
Forth Things:
PharmaSecure provides drug companies the ability to place a nine-digit alphanumeric code directly on the blister pack, medicine bottle or vial, or on the product’s label, along with a phone number. Consumers can verify the code and by extension make sure the drug they have purchased isn’t counterfeit by texting it to the accompanying phone number. In India, PharmaSecure’s initial market, 55 percent of the population has a mobile phone, and it’s the fastest-growing market for mobile phones in the world. If it weren’t for the proliferation of mobile phones in India and elsewhere, PharmaSecure’s business wouldn’t be possible.
Fifth Things:
The booming interest in social networking sites such as Facebook and Twitter is a highly visible social trend. Nearly half of all Americans are now members of at least one social network; double from just two years ago. Social networks not only provide people with new ways to communicate and interact with each other, but they act as platforms for other businesses to build on. Zynga, for example, the maker of popular online games like FarmVille and Scramble; became popular by making browser-based games that worked as application widgets on Facebook and MySpace. Similarly, entrepreneurs have launched businesses to start social networks that cater to specific niches. An example is PatientsLikeMe, the subject of Case 1.2, which is a social networking site for people with serious diseases.
Technological Advances:
Advances in technology frequently dovetail with economic and social changes to create opportunities. For example, there are many overlaps between an increased focus on health and wellness and technology. Airstrip Technologies, a recent start-up, enables doctors to monitor critical patient information remotely on a smartphone or computer. The company’s founding was motivated by a desire on the part of doctors to stay in closer contact with their critical care patients while away from the hospital and while those patients are receiving treatment in locations outside a hospital.
Tech first:
Advances in wireless technologies made the system possible. In most cases, the technology isn’t the key to recognizing business opportunities. Instead, the key is to recognize how technologies can use and harness to help satisfy basic or changing needs. It’s always been difficult for doctors to leave the bedsides of critically ill patients, for example. Now, as a result of the advent of smartphones and wireless networks; a company like Airstrip Technologies can develop products to help doctors remotely monitor their patients’ conditions.
Technological advances also provide opportunities to help people perform everyday tasks in better or more convenient ways. For example, OpenTable.com is a Web site that allows users to make restaurant reservations online and now covers most of the United States. If you’re planning a trip to San Diego, for example, you can access OpenTable.com, select the area of the city you’ll be visiting, and view descriptions, reviews, customer ratings, and in most cases the menus of the restaurants in the area.
You can then make a reservation at the restaurant and print a map and the directions to it. The basic tasks that OpenTable.com helps people perform have always been done looking for a restaurant, comparing prices and menus, soliciting advice from people who are familiar with competing restaurants and getting directions. What OpenTable.com does is help people perform these tasks more conveniently and expediently.
Teah second:
Another aspect of technological advances is that once a technology is created, products often emerge to advance it. For example, the creation of the Apple iPod, iPhone, iPad, and similar devices have in turned spawned entire industries that produce compatible devices. An example is H2OAudio, a company that was started by four former San Diego State University students; which makes waterproof housings for the Apple iPhone and iPod. The waterproof housings permit iPhone and iPod users to listen to their devices; while swimming, surfing, snowboarding, or engaging in any activity where the device is likely to get wet.
A similar industry is the one dealing with smartphone apps. As of May 2011, there were over 381,000 third-party apps available in Apple’s App Store and over 294,000 in the Android Market (Google’s app store).13 The app market is large and growing, all because of the advent of wireless networks and smart devices like the iPhone and iPad. To provide perspective on how big the app market is, at 10:26 A.M. GMT on Saturday, January 22, 2011, the 10 billionth app was downloaded from the Apple App Store.
Political Action and Regulatory Changes:
Political and regulatory changes also provide the basis for opportunities. For example, new laws create opportunities for entrepreneurs to start firms to help companies, individuals, and governmental agencies comply with these laws. For example, the No Child Left Behind Act of 2002; which is based on the notion of outcome-based education requires states to develop criterion-based assessments in basic skills to periodically give to all students in certain grades. Shortly after the act was passed, Kim and Jay Kleeman, two high school teachers, started Shakespeare Squared; a company that produces materials to help schools comply with the act.
Extra information:
On some occasions, changes in government regulations motivate business owners to start firms that differentiate themselves by “exceeding” the regulations. For example, several years ago, the Federal Trade Commission changed the regulation about; how far apart the wood or metal bars in an infant crib can be. If the bars are too far apart; a baby can get an arm or a leg caught between the bars, causing an injury.
An obvious business idea that might spawn by this type of change is to produce a crib; that advertises and position as “exceeding” the new standard for the width between bars and is “extra safe” for babies and young children. The change in regulation brings attention to the issue and provides ideal timing for; a new company to reassure parents by providing a product that not only meets but exceeds the new regulation.
Business change:
Some businesses and industries are so dependent on favorable government regulations that their literal survival threatens if a regulation change. An example of a business that fits this profile is Almost Family, a company that provides home health nursing services. Almost Family receives the majority of its income via fixed payments from Medicare based on the level of care that it provides its clients. As a result, the company’s profitability is highly sensitive to any changes in Medicare reimbursement policies.
Political change:
The political change also engenders new business and product opportunities. For example, global political instability and the threat of terrorism have resulted in many firms becoming more security conscious. These companies need new products and services to protect their physical assets and intellectual property; as well as to protect their customers and employees. The backup data storage industry; for example, is expanding because of this new trend in the tendency to feel the need for data to be more protected than in the past. An example of a start-up in this area is Box.net; which was funded by Mark Cuban, the owner of the Dallas Mavericks. Box.net allows its customers to store data “offsite” on Box.net servers, and access it via an Internet connection.
How to Explain Observing Trends in Entrepreneurship? Also, the Image from the Internet.
Characteristics of Organizational Culture; Like every person has his style of behavior, his personality, similarly the organization has a distinct culture. This culture may define as a set of all the espoused values of the organization. The culture of the organization can tier into 3 levels based on their visibility and how closely they are adhering to in the organization. The first level is Artifacts and Behavior. Artifacts and behavior are the most visible components of organizational culture. Also learn, What is Organizational Commitment? Most Important Characteristics of Organizational Culture!
How to Explain Most Important Characteristics of Organizational Culture?
They include the physical layout of the workplace and the observable behavior of its employees. The next level is Values. Values are less visible than behavior but they can see as they influence the observable behavior of the individuals working in the organization. But the top tier of organizational culture may see at the level of Assumptions and Beliefs. They cannot see, but they are so well ingrained in the employees that they come out quite naturally because that is the way the organization thinks.
Organizational culture is the outcome of both the management’s initial beliefs and employees’ adoption of those beliefs.
Explaining the Primary Characteristics of organizational culture:
As we can see, the unique ‘behavior’ of an organization can attribute to the makeup of the values that it espouses – the organizational culture. Let us understand these primary characteristics that define an organization’s culture as a whole, the ones that help shape up the organization’s ‘personality’.
These are very general characteristics that every organization would have to look into, otherwise, the culture would seem incomplete. Although all these characteristics are at some level a part of every company, the importance and individual interpretation of each differs from business to business, thus making each business unique in its way.
Innovation and Risk-Taking:
Risk and returns go hand in hand. In places where you take a risk (calculate the risk of course!), the chances of returns are higher. The same goes for innovation. You could either be a follower or a pioneer. Pioneering has its share of risks, but at times, it can also have a breakthrough outcome for the organization. Thus, innovation and risk-taking are one of the main characteristics of organizational culture-defining how much room the business allows for innovation.
Companies with cultures that place a high value on innovation encourage their employees to take risks and innovate in the performance of their jobs. Companies with cultures that place a low value on innovation expect their employees to do their jobs the same way that they have the train to do them, without looking for ways to improve their performance.
Attention to Detail:
Attention to detail defines how much importance a company allows precision and detail in the workplace. This is also a universal value as the degree of attention the employees are expecting to give is crucial to the success of any business. The management defines the degree of attention to be given to details.
This characteristic of organizational culture dictates the degree to which employees exist expected to be accurate in their work. A culture that places a high value on attention to detail expects its employees to perform their work with precision. A culture that places a low value on this characteristic does not.
Outcome Orientation or Emphasis:
Some organizations pay more attention to results rather than processes. It is the business model of each business that defines whether the focus should be on the outcome of the processes. This defines the outcome orientation of the business.
Companies that focus on results, but not on how the results exist achieving, place a high emphasis on this value of organizational culture. A company that instructs its sales force to do whatever it takes to get sales orders has a culture that places a high value on the emphasis on outcome characteristics.
People Orientation or Emphasis:
This is still one of the most contentious issues in organizational culture today. How much should be the management focus on the people? Some organizations are famous for being employee orient as they focus more on creating a better work environment for their ‘associates’ to work in. Others still are feudal, treating employees no better than work-machines.
Companies that place a high value on this characteristic of organizational culture place a great deal of importance on how their decisions will affect the people in their organizations. For these companies, it is important to treat their employees with respect and dignity.
Teamwork or Team Orientation:
It is a well-established fact that synergistic teams help give better results as compared to individual efforts. Each organization makes its efforts to create teams that will have complementary skills and will effectively work together.
Companies that organize work activities around teams instead of individuals place a high value on this characteristic of the organizational culture. People who work for these types of companies tend to have a positive relationship with their coworkers and managers.
Aggressiveness:
Every organization also lays down the level of aggressiveness with which their employees work. Some businesses like Microsoft are known for their aggression and market-dominating strategies.
This characteristic of organizational culture dictates whether group members exist expecting to be assertive or easygoing when dealing with companies they compete in the marketplace. Companies with an aggressive culture place a high value on competitiveness and outperform the competition at all costs.
Stability:
While some organizations believe that constant change and innovation are the keys to their growth, others are more focused on making themselves and their operations stable. The management of these organizations is looking at ensuring the stability of the company rather than looking at indiscriminate growth.
Just like having a strong personality adds character to a person, organizational culture does give a business its own special identity. It helps create cohesion among the employees as they share the primary characteristics of organizational culture and imbibes in them the spirit of teamwork.
A company whose culture places a high value on stability is rule-oriented, predictable, and bureaucratic. These types of companies typically provide consistent and predictable levels of output and operate best in non-changing market conditions. The culture of any organization is a reflection of the belief system or the values of its leaders, it is majorly a leadership factor that determines the culture of the firm. When the right leader is in the place he or she can shield the firm from the wrong external negative culture.
Simple Characteristics of Organisational Culture:
The following characteristics help us to understand the nature of organizational culture better. When we mix and match these characteristics, we get to the basis of culture:
Individual Autonomy:
The degree of responsibility, freedom, and opportunities of exercising initiative that individuals have in the organization.
Structure:
The degree to which the organization creates clear objectives and performance expectations. It also includes the degree of direct supervision that is used to control employee behavior.
Management Support:
The degree to which, managers provide clear communication, assistance; warmth, and support to their subordinates.
Identity:
The degree to which, members identify with the organization. As a whole rather than with their particular workgroup or field of professional expertise.
Performance Reward System:
The degree to which reward system in the organization like an increase in salary, promotions, etc. is based on employee performance rather than on seniority, favoritism, and so on.
Conflict Tolerance:
The degree of conflict present in relationships between colleagues and workgroups. As well as the degree to which employees are encouraged to air conflict and criticisms openly.
Risk Tolerance:
The degree to which, employees are encouraged to be innovative, aggressive, and risk-taking.
Communication Patterns:
The degree to which, organizational communications are restricted to the formal hierarchy of authority.
Outcome Orientation:
The degree to which, management focuses on results or outcomes rather than on the techniques and processes used to achieve these outcomes.
People Orientation:
The degree to which, management decisions take into consideration the impact of outcomes on people within the organization. When we appraise the organization based on the above characteristics. We get a complete picture of the organization’s culture. This picture becomes the basis of shared norms, beliefs, and understanding that members have about the organization. How things are done in it and how the members exist supposing to behave.
How to Explain the Most Important Characteristics of Organizational Culture?
Nature of Business Economics; A Traditional economic theory has developed along two lines; viz., normative, and positive. Normative focuses on prescriptive statements and helps establish rules aimed at attaining the specified goals of the business. Positive, on the other hand, focuses on the description it aims at describing how the economic system operates without staffing how it should operate.
Here is the article, How to explain the Nature of Business Economics?
The emphasis in business economics is on normative theory. Business economic seeks to establish rules which help business firms attain their goals, which indeed is also the essence of the word normative. However, if the firms are to establish valid decision rules, they must thoroughly understand their environment [Hindi]. This requires the study of positive or descriptive theory. Thus, Business economics combines the essentials of the normative and positive economic theory, the emphasis being more on the former than the latter.
Understanding the Characteristics or Nature of Business Economics
The following nature are below;
Microeconomic nature: Business Economics is Microeconomics in nature because it deals with the matters of a particular business firm only.
Use of economic theories: Business Economics uses all economic theories relating to the profits, distribution of income, etc.
Realistic one: Business Economics is real science. It studies all matters concerning business organization by considering the real conditions existing in the business field.
Normative Science: Business Economics is a normative science. It studies the matters concerning the aims and objectives of a business firm. Determines the methods to be adopted for achieving such objectives. It also makes an inquiry into the good and bad in decision making. Hence it is a normative science.
Use of Macroeconomics: Even though Business Economics has the nature of Microeconomics, it also uses Macroeconomics approaches frequently. Certain matters in Macroeconomics like business cycles, national income, public finance, foreign trade, etc. which are essential for Business Economics. So, Business Economics uses the Macro Economics phenomenon for taking business decisions.
Another five Main Characteristics of Business Economics
Some of the main characteristics of business economics are as follows:
Micro in Nature:
Business economics is microeconomics in nature. This is due to the study of business economics mainly at the level of the firm. Generally, a business manager is concerned with the problems of his business unit. He does not study the economic problems of an economy as a whole.
The basis of Theory of Markets and Private Enterprises:
Business economics largely uses the theory of markets and private enterprise. It uses the theory of the firm and resource allocation of the private enterprise economy.
Pragmatic in Approach:
Business economics is pragmatic in its approach. It does not involve itself with the theoretical controversies of economics. Yet it does not relegate the realities of business decision-making to the background by bringing in abstract assumptions. While economic theory abstracts from realities of the individual business units to build up its theories, managerial economics takes proper note of the particular economic environment in which a firm works.
Normative in Nature:
Business economics is also called normative economics which prescribes standards or norms for policymaking. Business economics is prescriptive rather than descriptive. Economic theory, we try to explain economic behavior: Business economics, we try to prescribe policies for a business manager which are most likely applied to achieve his objectives. In economic theory, we build ‘laws’ such as the law of Demand and the Law of Diminishing Returns. In business economics, we apply these laws for policy planning at the level of a firm.
Macro Analysis:
Macroeconomics which deals with the principles of economic behavior for the economy as a whole is also useful for business economics. A business unit operates within some economic environment which is in turn shaped by the behavior of the economy as a whole. Therefore, a business manager must know the external forces working in his business environment.
Following are the Importance Benefits of Corporate Retreats in Business!
Corporate retreats should handle in such a way that they are loved by everyone. Not only executives or big leagues, but also other employees should keep in mind while planning an office retreat. Office retreats have a lot of benefits, including Rewards – Corporate retreats are a good way to reward your employees. On corporate retreats, management can show their gratitude and appreciation toward their employees through many recreational and meaningful activities. Second Skill building – Besides team building, skills building is another important advantage of corporate retreats. Office retreats ensure that employees are able to build skills as well as know how to perform as a team. Why Small Business needs Corporate Retreats Good for Productivity? Now, learn Corporate Retreats in Business.
Increases in Revenue
Increasing sales and revenues are related but different goals, and each needs its own strategy. Although the tactics for each might be different, they should complement each other. Understanding how sales and revenue are related and how to balance your need to increase both helps you market efficiently and optimize your profits. What is Revenue? The income generating from the sale of goods or services, or any other use of capital or assets. Associated with the main operations of an organization before any costs or expenses are deducted. Revenue is shown usually as the top item in an income (profit and loss) statement from which all charges, costs, and expenses are subtracted to arrive at net income. Also call sales, or (in the UK) turnover.
Increase the number of new customers
After the corporate retreat, the employees will have a wider global perspective and confidence in dealing with people from different cultures and countries. With this values learn, the employees are able to increase the number of new customers. By increasing the number of new customers the organization is the most direct approach to increase the revenue of the organization. With a wider perspective, the employees are able to look into more opportunities and have a larger target market.
When the target market is enlarged the employees are equipped with the confidence in dealing with people from different cultures and countries. Which make the have better opportunities to capture the market. Also, the organization is able to increase the market share due to the huge diversity of the target market. As a result, they can be the market leader in the industry as they are able to capture the most diversity of customers.
Increase the value of each sale made to customers
The communication and influencing skills gain after the corporate retreat are able to help an organization to increase. The revenue by increasing the value of each sale made to customers. It means that the employees will have the power to communicate. Influence and persuade the customer to increase the value of each purchase. For example, if the customers normally purchase 500 units. The employees can persuade and influence the customers to increase the value of each purchase to 800 units. The employee might come out with packages to convince the customer to purchase more. Therefore, the employees can apply the innovation and creativity skill to design valuable packages to generate more revenue for the organization.
Increase the number of times that customers buy from you
Besides, corporate retreat trained employees in building and maintaining relationships. Through this skill, the employees are able to utilize this skill to generate more revenue. By building and maintaining a good relationship can increase the number of times that customers buy from you. The employees are should keep in touch with the customers so that the customers will do purchasing more frequent with you. For example, many organizations such as Hotels and Airlines which come out with loyalty cards. Where have a lot of strategies to increase the number of times you visit? There are various ways to build and maintain relationships with the customers such as e-mail, mail, text messaging, phone call and point and benefit given to attract the customers visit them often. Hence, innovation and creativity play important roles in developing strategies for building and maintaining relationships.
Decreases in Cost
What is Low-Cost? A type of pricing method where a business sets a comparatively low price in order to enhance the demand for its product among consumers, as well as its competitive position in the market. A low-cost pricing strategy is an alternative marketing approach that a business can use as an alternative to differentiation and focus pricing strategies, and it tends to be most successful when the product is fairly generic and high volume production is possible. Also, call a low price strategy.
Employee feedback for cost reduction
After the corporate retreat, the employee will motivate. So this will be the best time to get their contribution to the company. The managers can get feedbacks through personal interview, daily communication or improvement box. The reasons the managers should get feedback’s from the employees because employees have a direct relation to the work process and have more experience regarding the daily operations of the company. On the other hand, managers make cost reduction decisions based on theories such as studies, reports, and charts. But, the company has to start using feedback’s given by the employees so that they will contribute more as they feel they are part of the solution. Besides, rewarding them is very important to encourage feedback.
Decrease in Turnover Rate
The main key to decrease the turnover rate is through job satisfaction. The satisfied employees will show positive attitude and morale during the job. In order to create job satisfaction, the organization should fulfill the employees’ needs. Hence, after the corporate retreat, the employee’s relationships built or maintain, communication & influencing skills are enhanced and more towards team focus. Therefore, the employees will have job satisfaction as the company fulfilled the social need of the employees.
According to the Maslow’s hierarchy of Needs Theory of Motivation, human beings have a social need. Moreover, the employees will more loyal to the company as they feel the sense of belonging. This is because they are given attention, opportunities, and recognition in the company. According to Maslow’s hierarchy, this fulfills their self-esteem need. Besides, according to the Herzberg’s Two Factor Theory of Motivation, it wills the motivators factor for the employees which will create satisfaction. As a result of job satisfaction through the skills develop from the corporate retreat which fulfilling the need for employees, the organization will able to reduce the turnover rate in the organization. How to Get Benefits of Corporate Retreats in Organizations?
Reference
1. Importance Benefits of Corporate Retreats – //www.mbaknol.com/modern-management-concepts/benefits-of-corporate-retreats/ 2. What is Revenue? – //www.businessdictionary.com/definition/revenue.html 3. What is Low-Cost? – //www.businessdictionary.com/definition/low-cost.html 4. Photo Credit URL – //www.yourworldwithcreflo.com/wp-content/uploads/2015/01/bigstock-Group-Of-Friends-Having-Fun-To-58863764.jpg
Here are Following Tips Get Benefits of Corporate Retreats in Organizations!
Corporate retreats can be of any type, such as a sports retreat, or a seminar-style retreat. They are to promote a feeling of teamwork and to build a better understanding among company employees. Corporate retreats can also help employees gain some problem-solving skills that lead to better teamwork and better overall productivity. These team-building activities focus on events where everyone has to work together to reach a common goal.New Roles of Human Resource Management in Business Development. The study of learning, Benefits of Corporate Retreats in Organizations.
The examples are river rafting, rock climbing, mountain climbing, everyone hiking blindfolded while holding on the same rope, team scavenger hunts, friendly competitions between company departments, etc. Corporate retreats can be customized to fit the company’s need. They can make the employees learn about what the temporary retreat goals are, as well as the long-term results that the company is striving for.
Why can corporate retreats increase productivity? This is because organizations can derive some valuable skills from corporate retreats. These skills include team spirit, problem-solving, leadership, innovation, and creativity.
Team Spirit
Corporate retreats promote a feeling of teamwork among company employees. For example, a company organized a corporate retreat where the employees had to build a bridge out of boxes and unstable wooden planks. The employees are working towards a common goal which is building a bridge. This will get them to see the power of acting as a team. They will be able to understand success in each activity depends more on teamwork than individual effort. Under the pressure of reaching a difficult goal, each individual undergoes rapid growth. This growth occurs in group efforts then enhancing the relationships between employees. Employees become connected with shared experience. They share the commitment and help from one another. Trust can also build through corporate retreats.
Problem-solving
The second skill gain from corporate retreats is about problem-solving. Take rock climbing as the example. Rock-climbing is a problem-solving in the vertical world. We can see varying degrees of linear thinking skills, pre-planning skills, impulsivity vs. thoughtfulness, decision-making skills, focus and concentration, frustration, tolerance, self-confidence vs. insecurity, introversion vs. extroversion, emotional lability, risk-taking vs. caution, and the list goes on. Rock climbing offers the added mental element of continuous problem-solving in the midst of a physical workout. The climbers attempt to ascend a select route without falling. Through rock climbing, they can train on those skills.
Leadership
Through corporate retreats like mountain climbing, rock climbing, river rafting, etc. individuals gain an awareness of faith in their own ability to lead and follow. They have opportunities to test their ability in critical group decision-making and thereby become more confident leaders. Besides, team building events often allow people who are not usually in charge at work to take the reins and direct their teams. This can not only help them work on their leadership skills but also give them a better understanding of what it means to be a leader. The result of this is that they can have a better understanding of their superior’s working situations. They can also aid communication channels within the workforce.
Innovation and Creativity
Another skill derives from the corporate retreat is innovation and creativity. Employees are more able to think out of the box outside the working environment. In outdoor settings, they are taken out of their ‘comfort zone’ and immerse in a changing environment. By handling new circumstances, the team learns to turn problems into opportunities for success. Each challenge mastered is a satisfying achievement that prepares them for even more opportunities. Besides, some team-building activities may require innovation and creativity. Like the previous example, company’s corporate retreat is about building a bridge out of boxes and unstable wooden planks. In this case, in order to build a better and safer bridge with those limited resources, the employees need to innovative and creative.
Other Good Tips also Better, Benefits of Corporate Retreats
There are only two sides to a corporate retreat. It is either loved by employees or hated by them. But nevertheless, corporates retreats have a lot of different advantages to offer. Corporate retreats should handle in such a way that they are loved by everyone. Not only executives or big leagues, but also other employees should keep in mind while planning an office retreat. Office retreats have a lot of benefits, which will we discuss in this article.
Interaction
One of the major benefits of corporate retreats is team building. People may work together for years in an organization. But as soon as they go on an offsite retreat to have sun fun, new and everlasting bonds are built. It is a known fact that people tend to be their true self when they are relieved from pressure. Corporate retreats help remove this pressure and let a person open up. Every employee of an organization is considered to the same on an office retreat. There is no bias or preferences towards anyone. This makes a person feel important and he is easily able to get connect and interact with others.
Rewards
Corporate retreats are a good way to reward your employees. An informal announcement of a bonus or an incentive may come as a lovely surprise. Moreover, it will do wonders when the employees would already light head and in a fun mood. On corporate retreats, management can show their gratitude and appreciation towards their employees through many recreational activities which maybe follow with presents.
Goals and Objectives
During office hours, people are not as focus as they are on a retreat. They are their true self and can give great ideas. Moreover, due to bonding and relationships which are built on a retreat, people move in the same direction and start working to achieve the same goals and objectives. This is because, after a retreat, not only business relationships but also personal feelings come into play while working in an office.
Recruitment
Executives and HR managers also use corporate retreats as a chance to hire and recruit professionals. Corporate recruits give them a chance to learn more about the people they are thinking about hiring for the organization. As mentioned earlier, a person is his true self during a retreat. Due to this, HR managers are able to study their behavior and relationship or rapport with other employees of the organization. This will give them an idea if the newly appointed employees will be able to work in the office environment or not.
Skill building
Besides team building, skills building is another important advantage of corporate retreats. Office retreats make sure that employees are able to build skills as well as know how to perform in a team. It does not matter if you have a low budget. A short retreat in a local area will help you as much as an expensive retreat. Just make sure that you include educational as well as creative recreational activities.
Corporate retreats have the negative side too. Burger King’s corporate retreat in 2001 is a failure. A dozen Burger Kings employees burn themselves while participating in a fire walk-a team building exercise that requires teammates to walk barefoot across an 8-foot pit of burning-hot coals. The results were injuring employees and some very negative publicity for Burger Kings. The concept of this corporate retreat was that when the employees experience humiliation together, they will feel bonded. In fact, organizations should steer away from ridiculous physical challenges, and then they can get benefits from corporate retreats.
Reference
1. Benefits of Corporate Retreats in Organizations – //www.mbaknol.com/modern-management-concepts/benefits-of-corporate-retreats/ 2. Others Benefits of Corporate Retreats – //www.business2community.com/human-resources/what-are-the-various-benefits-of-corporate-retreats-0279236 3. Photo Credit URL – //www.doorwaysarizona.com/wp-content/uploads/2015/01/bigstock-Group-Of-Friends-Having-Fun-To-58863776.jpg
Here are 7 types of Explain Techniques of Scientific Management, Study and Learn!
Here are 7 types of Explain Techniques of Scientific Management, Study and Learn! Some of the major techniques of scientific management are as follows: 1. Work Study 2. Standardization of Tools and Equipment’s 3. A Scientific Task Setting 4. Scientific Setting of Wage Rates 5. The Scientific Selection and Training 6. Functional Foreman-ship 7. Differential Piece-Rate Plan. Also, learn; What are the Principles of Scientific Management?
Following Explain Techniques of Scientific Management here are:
1. Work Study:
Work study implies an organized, objective, systematic, analytical and critical assessment of the efficiency of various operations in an enterprise. It is a generic term for those techniques which are used in the examination of human work in all its context and which lead systematically to the investigation of all factors which affect the efficiency and economy of operations.
It is a technique which enables the manager to ascertain standard time taken for performing a specified job. Every job or every part of it is studied in detail. This technique is based on the study of an average worker having reasonable skill and ability. Average worker is selected and assigned the job and then with the help of a stop watch, time is ascertained for performing that particular job. Taylor maintained that Fair day’s work should be determined through observations, experiment and analysis by keeping in view an average worker.
Work-Study includes the following techniques:
(а) Method Study:
This study is conducted to know the best method of doing a particular job. It helps in reducing the distance travelled by materials, and brings improvement in handling, transporting, inspection and storage of raw materials and goods.
(b) Motion Study:
Motion study is a technique which involves close observations of the movement of body and limbs of an individual required to perform a job. It is the study of the movement of an operator or a machine to eliminate useless motions and find out the best method of doing a particular job. By undertaking motion study, an attempt is made to know whether some elements of a job can be eliminated, combined or their sequence changed to achieve the necessary rhythm.
The purpose of motion study is (i) to find and eliminate wasteful motions among the workers, and (a) to design the best methods of doing various operations. It leads to increase the efficiency of workers by reducing fatigue and manual labor. It results in higher production and productivity.
(c) Time Study or Work Measurement:
Time study is the technique of observing and recording the time required by a workman of reasonable skills and ability to perform each element of the tasks in a job. Through time study, the precise time required for each element of a man’s work is determined. It helps in fixing the standard time required to do a particular job.
The purpose of time study is to scientifically determine the standard time for doing a job under given condition. It helps to measure the efficiency of workers. It creates time consciousness among workers. Saving in time leads to cost reduction and increased efficiency.
(d) Fatigue Study:
A Fatigue, physical or mental, has an adverse effect on the worker’s health and efficiency. The Fatigue study helps in reducing fatigue among the workers. The Fatigue is generally caused by long working hours without rest pauses, repetitive operations, excessive specialization, and poor working conditions. The purpose of fatigue study is to maintain the operational efficiency of the workers.
2. Standardization of Tools and Equipments:
Taylor advocated standardization of tools and couplings, cost system and several other items. Efforts should be made to provide standardized working environment and methods of production to the workers. Standardization would help to reduce spoilage and wastage of materials, improve quality of work, reduce cost of production and reduce fatigue among the workers.
It is essential to set a standard task which an average worker source does during a working day. Taylor called it a fair day’s work. He emphasized the need for fixing a fair day’s work because it will prevent the workers from doing work much below their capacity. The standard task will act as a norm before the workers. If no standard is set, the workers will work below his capacity.
4. Scientific Setting of Wage Rates:
Wage rates should be fixed in such a way that he average worker is induced to attain a standard output. Taylor suggested the differential piece- wage system. Under this system, higher rates are offered to those workers who produce more than the standard quantity. Taylor was of the view that the efficient workers should be paid, from 30% to 100% more than the average workers.
5. Scientific Selection and Training:
The management should design scientific selection procedure so that right men are selected for the right jobs. The first step in scientific selection is determining the jobs for which workers are required. After that the most appropriate qualification, training, experience and the level of efficiency for the requisite post are determined. Employees are selected according to predetermined standards in an impartial way.Making the Feedback Training Method Work.
6. Functional Foreman-ship:
Taylor advocated that specialization must be introduced in a factory. He advocated ‘functional foreman-ship’ for this purpose. Functional foreman-ship is a form, of organization which involves supervision of a worker by several specialist foremen. For instance, matters relating to speed of work and repairs of machinery will be supervised by the speed boss and the repair boss respectively.
The purpose of functional foreman-ship is to improve the quality of supervision of workers by employing specialist foremen. Taylor believed that a single foreman is not competent to supervise all functional matters. How to Processes of Scientific Management?
In Taylor’s functional foreman-ship, planning is separated from execution. He recommended eight foremen in all to control the various aspects of production. He suggested four foremen m the planning department, namely, route clerk, instruction card clerk time and cost dark and shop disciplinarian. The four foremen recommended for getting the required performance from the workers include gang boss, speed boss, repair boss and inspector.
Understand by Chat; Functional Foreman-ship
Taylor advocated functional foreman-ship for achieving ultimate specification.
This technique was developed to improve the quality of work as single supervisor may not be an expert in all the aspects of the work.
Therefore workers are to be supervised by specialist foreman.
The scheme of functional foremanship is an extension of principle pf specialization at the supervisory level.
Taylor advocated appointment of 8 foramen, 4 at the planning level & other 4 at implementation level.
The names & function of these specialist foremen are: –
Instruction card clerk concerned with tagging down of instructions according to which workers are required to perform their job
Time & cost clerk is concerned with setting a time table for doing a job & specifying the material and labor cost involved in it.
Route clerk determines the route through which raw materials has to be passed.
Shop Disciplinarians are concerned with making rules and regulations to ensure discipline in the organization.
Gang boss makes the arrangement of workers, machines, tools, workers etc.
Speed boss concerned with maintaining the speed and to remove delays in the production process.
Repair boss concerned with maintenance of machine, tools and equipments.
Inspector is concerned with maintaining the quality of product.
7. Differential Piece-Rate Plan:
This plan was suggested by Taylor to attract highly efficient workers. Under this plan, there are two piece work rates, one is lower and another is higher. The standard of efficiency is determined in terms of number of units during a day or standard same. The worker who produces more than standard output within the standard time.
He will be given higher piece rate. On the other hand, if a worker is below the standard, he shall be given lower rate of wages. The slow worker is thus penalized as he gets wages at a lower piece rate. Thus Taylor’s scheme of wage payment encourages the workers to attain higher standard of performance and earn wages at higher rate. Also, read it; Seven Researchers or Pioneers of Management.
Learn, Explanation of Nature and Scope of Financial Management
Financial management is one of the important aspects of finance. Nobody can ever think to start a business or a company without financial knowledge and management strategies. Finance links itself directly to several functional departments like marketing, production, and personnel. Here we will list out some of the major scopes of financial management notes which will help you in your decision-making process. Also learn, Types of Financial Decisions, How to Explain Nature and Scope of Financial Management?
Financial management has a wide scope. According to Dr. S. C. Saxena, the scope of financial management includes the following five A’s.
Anticipation: Financial management estimates the financial needs of the company. That is, it finds out how much finance is requiring the company.
Acquisition: It collects finance for the company from different sources.
Allocation: It uses this collected finance to purchase fix and current assets for the company.
Appropriation: It divides the company’s profits among the shareholders, debenture holders, etc. It keeps a part of the profits as reserves.
Assessment: It also controls all the financial activities of the company. Financial management is the most important functional area of management. All other functional areas such as production management, marketing management, personnel management, etc. depend on Financial management. Efficient financial management is required for survival, growth, and success of the company or firm.
Key Scope of Financial Management!
The major scope of financial management is dividing into four categories. Let’s learn and understand the nature and scope of financial management through the below details notes.
Investment Decision:
Evaluating the risk involve, measuring the cost of fund and estimating expected benefits from a project comes under investment decision. It is one of the important scopes of financial management. The two major components of investment decision are Capital budgeting and liquidity. Capital budgeting is commonly known as the investment appraisal. It deals with the allocation of capital and funds in such a manner that they will yield earnings in future. Capital budgeting determines the long-term investment which includes replacement and renovation of old assets. It is all about maintaining an appropriate balance between fix and current assets in order to maximize profitability and to maintain desired liquidity in the firm for its smooth functioning.
Working Capital Decision:
Decisions related to working capital is another crucial scope of financial management. Decisions involving around working capital and short-term financing are known as a working capital decision. It also manages the relationship between short-term assets and its liabilities. Short-term assets include cash in hand, receivables, inventory, short-term securities, etc. Creditors, bills payable, outstanding expenses, bank overdraft, etc are a firm’s short-term liabilities. Short-term assets can exchange for cash within one calendar year. Similarly, the liabilities are to settle within an accounting year.
Dividend Decision:
The Dividend Decision plays a crucial role in today’s corporate era. It determines the amount of taxation that stockholders pay. A good dividend policy helps to achieve the objective of wealth maximization. Distributing the entire profit in the form of dividends or distributing only a certain percentage of it is decided by dividend policy. It is known as deciding the optimum dividend payout ratio i.e. proportion of net profits to be paid out to shareholders. Stability of cash dividends and stock sets the parameter which determines the number of investment opportunities. Expansion of an economic activity depends on the effectiveness of dividend decisions and scope of financial management.
Financing Decision:
Financing Decisions focuses on the accountabilities and stockholders’ equity side of the firm’s balance sheet, for example, the decision to issue bonds is a kind of financing decision. The main aim of financing decision is to cover expenses and investments. The decision involves generating capitals by various methods, from different sources, in relative proportion and considering opportunity costs, with respect to time of flotation of securities, etc.
The scope of financial management is to meet the expenses of the firm, a suitable capital structure for the enterprise should develop by the finance manager. Only an optimum finance mix can maximize the market price of the company’s shares in the long run. To decrease the risk, a stable equilibrium is requiring between debt and equity. Return and risk to the equity shareholders depend on how optimally the debts and financial leverages are using. Only when the risk and return are in synchronization, the market value per share is maximizing. The apt timing for raising funds is to decide by the financial manager time to raise the funds.
Nature of Financial Management!
Finance management is a long-term decision-making process which involves a lot of planning, allocation of funds, discipline and much more. Let us understand the nature of financial management with reference to this discipline.
Finance management is one of the important education which has to realize worldwide. Now a day’s people are undergoing through various specialization courses of financial management. Many people have chosen financial management as their profession.
The nature of financial management is never a separate entity. Even as an operational manager or functional manager one has to take responsibility for financial management.
Finance is a foundation of economic activities. The person who Manages finance is called the financial manager. An important role of a financial manager is to control finance and implement the plans. For any company financial manager plays a crucial role in it. Many times it happens that lack of skills or wrong decisions can lead to heavy losses to an organization.
Nature of financial management is multi-disciplinary. Financial management depends upon various other factors like accounting, banking, inflation, economy, etc. for the better utilization of finances.
An approach to financial management is no limit to business functions but it is a backbone of commerce, economic and industry.
Scope & Elements of Financial Management!
Investment decisions: Include investment in fixed assets (call as capital budgeting). Investment in current assets is also a part of investment decisions call for working capital decisions.
Financial decisions: They relate to the raising of finance from various resources which will depend upon the decision on the type of source, the period of financing, cost of financing and the returns thereby.
Dividend decision: The finance manager has to take a decision with regards to the net profit distribution. Net profits are generally divided into two: 1) The dividend for shareholders- Dividend and the rate of it has to decide. 2) Retained profits- Amount of retained profits has to finalize which will depend upon expansion and diversification plans of the enterprise.
Reference
1. Key Scope of Financial Management – http://wikifinancepedia.com/finance/financial-management/nature-and-scope-of-financial-management
2. The scope of Financial Management – http://kalyan-city.blogspot.in/2011/09/what-is-financial-management-meaning.html
3. Scope & Elements – http://www.managementstudyguide.com/financial-management.htm
