Q.Explain the need for developing entrepreneurial competencies from the point of view of both the individual entrepreneur and the economy.

Developing competencies pays off twice — it helps the individual venture succeed and it helps the whole nation grow.

Organise the answer into two halves — benefits to the entrepreneur, and benefits to the economy.

Because entrepreneurial competencies can be developed, and because most people never fully develop them if left to chance, deliberate development is needed. Its importance is best seen from two points of view.

A. From the point of view of the individual entrepreneur.

1. Higher chance of success and survival. Many new small businesses fail early, often not because the idea was poor but because the founder lacked competencies such as planning, problem solving or efficiency orientation. Developing these directly raises the venture's chances of surviving and growing.
2. Ability to identify and grasp opportunities. Opportunity-seeking is itself a competency; sharpening it helps a person spot genuine opportunities that others miss.
3. Better use of scarce resources. Planning, information seeking and efficiency orientation help the entrepreneur use limited money, material and manpower more productively.
4. Confidence to take calculated risks. Self-confidence and problem-solving ability turn a hesitant person into one willing to take calculated — not reckless — risks, which is the essence of entrepreneurship.
5. Ability to lead and grow the enterprise. Power-cluster competencies such as persuasion and assertiveness help the entrepreneur build a team, deal with customers and financiers, and expand over time.

B. From the point of view of the economy / society.

1. Employment generation. Each successful enterprise creates self-employment for the founder and jobs for others — vital in a country with a large young workforce.
2. Balanced regional development. Competent entrepreneurs set up units even in backward and rural areas, spreading industry and incomes beyond a few big cities.
3. Use of local resources and wider spread of ownership. New entrepreneurs put idle local savings, raw materials and skills to productive use and spread economic power among many owners.
4. Industrial growth and national income. More successful enterprises mean more production, higher national income and faster growth.
5. Poverty reduction and better living standards. The jobs and self-employment created raise incomes and living standards, especially among weaker sections.

Because the gains flow to both the individual and the nation, the government funds organised Entrepreneurship Development Programmes to develop these competencies on a planned, large scale.