Lesson 5. Managing Competition In Modern World And Entrepreneurship Development Programmes
Competition is universal. Competition is defined as organizations’ battle with other organizations for some gainful outcome in various forms and fields viz market, customers, ranking, or resources. Managing competition through competitor intelligence is a powerful tool for entrepreneurs. Competitor intelligence is a process of gathering information about competitors, their acts, and how their acts will influence the organization.
5.2. WAYS OF DEFINING COMPETITORS
There are three ways to define possible competitors.
The first approach is the ‘industry perception’. It identifies competitors as organizations that provide similar services or similar products. For example, the car company, the automobile industry, etc. The competitors in each of these above mentioned companies produce similar types of products or services. With this approach, an organization can get an idea about the market. Competition is at its peak when competitors are in plenty. All these business rivals exploit the same tactics to achieve similar targets- the major one being- drawing maximum customers
The second approach is the marketing perception, which says that competitors are organizations that fulfill the same customer requirement. For example, if the customer needs technical information, the competitors might arrange for scientists, print and electronic media, etc. Here, the competition depends on how well the customer's requirements are understood and how well different organizations have been able to fulfill the requirements.
The third approach is the strategic groups’ perception. In this approach, the competitors follow more or less the same strategy in a particular market. It can be found even within a single industry also. For example, two mostly used strategic factors in grouping competitors are price (low to high) and quality (low to high). Price, quality, geographic scope, product line, market share, profits and product uniqueness are the possible dimensions for identifying strategic groups. The intensity of competition can be understood from how effectively each competitor has been able to develop a competitive advantage.
But, it is always to keep in mind that there will be other organizations working hard to secure the same customers, resources, and outcomes that you also want.
5.3. COMPETITIVE INFORMATION
a) Type of Competitive Information to be collected:
In order to collect information of what the competitors are busy with, one should consider following tricks:
Variety of products or services offered by the competitors.
Specific features of the products or services offered by the competitors.
Their products' plus and minus points.
The style of business management by the other parties.
The success percentage of the competing companies must be taken note of.
The way the competitors handle new trends in business
b) Principles for managing competition
The entrepreneur has to adopt certain principles for managing competition. Some of them are as mentioned below :
• sorting of opportunities must be done promptly .
• an attempt must be made to study the psychology of the customer
• a record ,a watch on the movements of the competitors must be maintained
• To maintain a safe and healthy business identify and visualize the upcoming business trends
5.4. ENTREPRENEURSHIP DEVELOPMENT PROGRAMMES (EDPs)
Entrepreneurs play a major role in the socio-economic development of a nation. Therefore, the role of entrepreneur is of great significance to a country like India where the country is facing problems of poverty and unemployment. Recognizing the significance of small scale industries in creation of employment and financial development, the Government of India began to give promotional packages to facilitate setting up of innovative enterprises. Thus, Entrepreneurship Development Programmes (EDPs) started in late sixties. This programme was meant for a specific group of new entrepreneurs.
5.5. THE OBJECTIVES OF THE ENTREPRENEURSHIP DEVELOPMENT PROGRAMMES (EDPS)
To develop the entrepreneurial quality by increasing the supply of entrepreneurs to achieve the goal.
To analyze the environmental set up in regard to micro enterprises and improve their performance by the supply of well trained entrepreneurs .
Know pros and cons in becoming an entrepreneurs and to provide self-employment to a large number of young men and women.
Enhance the growth of small-and medium-scale enterprise sectors which offer better potential for employment generation and dispersal of industrial unit.
Develop a broad vision about the business enterprise in rural areas where local entrepreneurship is not really available.
5.6. THE INDIAN EDP- An Admirable Model
It is generally believed that entrepreneurs are born but EDPs have proved that wrong in Indian context. Ordinary persons can also be converted into successful entrepreneurs through well-designed training programmes conducted by the Entrepreneurship Development institutes. The Entrepreneurial Development Programmes are well-designed and inclusive of modular packages considering the needs of the potential entrepreneurs. In the Indian context, EDPs are usually conducted for four to six weeks and the curriculum adopted by the training institutes for imparting training is also quite uniform.
5.7. PHASES OF EDPs
The EDPs normally pass through following three important phases:
• Pre-training phase
• Training phase
• Post-training or follow-up phase
This phase is the preliminary phase for launching the programmes. It includes following activities:
i) Recognition of promising area, generally a district
ii) Selection of a project leader to coordinate the programme
iii) Arrangement of infrastructure for the programme
iv) Identification of good business opportunities
v) Promotional campaigns
vi) Establishing contacts NGOs and related agencies which can contribute to the programme
vii) Procedure of application forms.
d) Selecting the trainees through particular procedure
e) financial arrangements
f) Preparing and finalizing the training syllabus and arranging guest faculties to impart training
vi) Contacting the support agencies such as DICs, SFCs, SISI, banks, NSIC, District Magistrate, etc. for support .
vii) Organizing industrial motivational campaigns to have as many number of applications as possible.
Training phase: During the training, entrepreneurs are provided proper guidance for setting up enterprise. Most of the Entrepreneurship Development institutes generally carry out full time training programmes of 4-6 weeks duration.
Training Phase: Motivational course content is provided to trainees that build and develop confidence in building entrepreneurs. It aims at empowering with decision-making skills to set up a new venture. The training also makes them grab new opportunities. Information regarding how to plan a project is also provided to trainees. For Industrial exposure and to have first-hand knowledge of factory layout, business sites, etc. plant visit/in-plant training are arranged.
Post-training phase: Post-training phase is also known as the phase of follow-up support. During this phase, post-training guidance and services are rendered to the participants of the Entrepreneurship Development Programme (EDP). During this phase, the training organization helps the entrepreneur in sorting out the problems through counseling. A committee is form consisting of members generally drafted to help the entrepreneurs.
Usually, follow-up action meetings are planned thrice a year after the completion of training and the following methods are generally used for follow-up:
a) Postal feedback form
b) Telephonic follow-up
c) Personal contact by the trainer
5.8. Challenges faced by EDPs: The low level of performance by the EDP is usually faced owing to the following problems in organizing and conducting EDP trainings:
a) Scarcity of sufficient number of specialized and dedicated organizations
b) Insufficient trainer motivators to motivate people for undergoing EDPs and to impart training
c) Identification of wrong projects
d) Lack of entrepreneurial culture and background
e) Disinterest shown by the supporting agencies and financial institutions to support the entrepreneurs
f) Lack of proper linkages
g) Selection of wrong individual for training
h) Insufficient counseling after training
i) Lack of continuous post-training support services for the project
- Mohanty, S.K. 2009. Fundamentals of Entrepreneurship. Prentice Hall of India Pvt. Ltd., New Delhi.
- Mary Coulter. 2008. Entrepreneurship in Action. Prentice Hall of India Pvt. Ltd., New Delhi