Now a days in India, startups have been increasing day by day ......but due to lack of proper knowledge and guidance a large number of failures are also occuring.....
Let's today discuss something important about a model of the start up process.....in simple words we can say that what are factors to be kept in mind before starting up a start up.....there are a list of key points ....let's get started with a short statistics on startup in India followed by model of the startup process
"India is becoming a startup hub. Opportunity for growth is enormous, which we had never seen in our lifetime. Challenge is how fast a company wants to transform," NASSCOM president Debjani Ghosh said.
As per latest news the startups in India saw a 108% growth in total funding from USD two billion in 2017 to USD 4.2 billion this year, National Association of Software and Services Companies said .
A Model of the Start-Up Process:
The processes of entrepreneurship and small business management can be thought of as making up a spectrum that includes six distinct stages. The stages of the entrepreneurship process are innovation, a triggering event, and implementation. The stages of the small business management process are growth, maturity, and harvest The entrepreneurship process begins with an innovative idea for a new product, process, or service, which is refined as you think it through.
You may tell your idea to family members or close friends to get their feedback as you develop and cultivate it. You may visit a consultant at a local small business development center for more outside suggestions for your innovative business idea. Perhaps you even wake up late at night thinking of a new facet of your idea. That is your brain working through the creative process subconsciously.
The time span for the innovation stage may be months or even years before the potential entrepreneur moves on to the next stage. Usually a specific event or occurrence sparks the entrepreneur to proceed from thinking to doing—a triggering event.When a triggering event occurs in the entrepreneur’s life, he or she begins bringing the organization to life. This event could be the loss of a job, the successful gathering of resources to support the organization, or some other factor that sets the wheels in motion.
Implementation is the stage of the entrepreneurial process in which the organization is formed. It can also be called the entrepreneurial event.
5 Risk increases at this stage of the entrepreneurial process because a business is now formed.
The innovation goes from being just an idea in your head to committing resources to bring it to reality. The com�mitment needed to bring an idea to life is a key element in entrepreneurial behavior.
Implementation involves one of the following:
(1) introducing new products,
(2) introducing new methods of production,
(3) opening new markets,
(4) opening new supply sources, or
(5) industrial reorganization.
(6)Entrepreneurship is, in essence, the creation of a new organization.
(7) By defining entrepreneurship in terms of the organization rather than the person involved, we can say that entrepreneurship ends when the creation stage of the organization ends. This is the point where the small business management process begins.
The small business manager guides and nurtures the business through the desired level of growth. The growth stage does not mean that every small business manager is attempting to get his or her business to Fortune 500 size. A common goal for growth ofsmall businesses is to reach a critical mass, a point at which an adequate living is provided for the owner and family, with enough growth remaining to keep the business going.
The maturity stage of the organization is reached when the business is consideredwell established. The survival of the business seems fairly well assured, although thesmall business manager will still face many other problems and challenges. Many pure entrepreneurs do not stay with the business until this stage. They have usually moved on to other new opportunities before this point is reached. Small business managers, by contrast, are more committed to the long haul.
This stage could be as short as a few months (in the case of a fad product) or as long as decades. Maturity in organizations can be similar to maturity in people and in nature. It is characterized by more stability than that of the growth and implementation stages.
Of course, organizations should not become too complacent or stop looking for new ways to evolve and grow, just as people should continue learning and growing throughout their lives.
In the harvest stage, the owner removes him or herself from the business. Harvesting a business can be thought of as picking the fruit after years of labor. In his book The Seven Habits of Highly Effective People, Steven Covey says that one of the keys of being effective in life is “beginning with the end in mind.”
(8) This advice applies to effectively harvesting a business also. Therefore, it is a time that should be planned for carefully.
The harvest can take many forms. For example, the business might be sold to another individual who will step into the position of manager. Ownership of the business could be transferred to its employees via an employee stock ownership plan (ESOP).
It could be sold to the public through an initial public offering (IPO). The business could merge with another existing business to form an entirely new business. Finally, the harvest could be prompted by failure, in which case the doors are closed, the creditors paid, and the assets liquidated.
Although made in a different context, George Bernard Shaw’s statement, “Any darned fool can start a love affair, but it takes a real genius to end one successfully,” can also apply to harvesting a business.
Not every business reaches all of these stages. Maturity cannot occur unless the idea is implemented. A business cannot be harvested unless it has grown.
Management guru Peter Drucker points out that innovation occurs as a response to opportunities within several environments.
(9)For example, other entrepreneurs might serve as role models when we are in the innovation and triggering-event stages. Businesses in the implementation and growth stages must respond to competitive forces, consumer desires, capabilities of suppliers, legal , and other forces.
The environmental factors that affect the way in which a business must operate change from one stage to the next.The personal characteristics of the entrepreneur or the small business manager that are most significant in running a business will vary from one stage to the next.
As you will see in the next section, personal characteristics or traits are not useful in predicting who will be a successful entrepreneur or small business manager, but they do affect the motivations, actions, and effectiveness of those running a small business.
For example, in the innovation and triggering-event stages, a high tolerance for ambiguity, a strong need to achieve, and a willingness to accept risk are important for entrepreneurs. In the growth and maturity stages, the personal characteristics needed to be a successful small business manager are different from those needed to be a successful entrepreneur.
In these stages the small business manager needs to be persevering, committed to the long run of the business, a motivator of others, and a leader.
business also changes as it matures. In the growth stage, attention is placed on team building, setting strategies, and creating the structure and culture of the business.In the maturity stage, more attention can be directed to specific functions of the business.
The people within the business gravitate toward, specialize in, and concentrate on what they do best, be it marketing, finance, or managing human resources.The purpose of the entrepreneurship and small business management model is to illustrate the stages of both processes and factors that are significant in each.
The purpose of this book is to assist you as you proceed from the innovation stage through the management of your successful business to a satisfying harvest.
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