Managerial Skills: Prof. Aparna Kanchan

Managerial Skills
Prof. Aparna Kanchan

Introduction
Creating a new enterprise is one of the

greatest management challenges.
Entrepreneurs have built successful
companies by being able to exploit unmet
needs in the market.
2
What is Entrepreneurship?
The process of creating a business enterprise capable

of entering new or established markets.
It involves deploying resources and people in a unique

way to develop a new organization.
An entrepreneur is an individual who creates an

enterprise that becomes a new entry to a market.
3
The Importance of Entrepreneurship
Job Creation
Entrepreneurship accounts for most new jobs in
the an economy.
Innovation
Entrepreneurships are responsible for
introducing a major proportion of new and
innovative products and services into market.
Opportunities for Diverse People
People of diverse background can improve their5
economic status by becoming entrepreneurs.
4
Why Become an Entrepreneur?
The three primary reasons that people become entrepreneurs and start their
own firms
Desire to be their own boss
Desire to pursue their

own ideas
Financial rewards
5
Entrepreneurship Myths
6
Myth 1: Entrepreneurs Are Born, Not Made
This myth is based on the mistaken belief that

some people are genetically predisposed to be
entrepreneurs.
The consensus of many studies is that no one is
born to be an entrepreneur; everyone has the
potential to become one.
Whether someone does or doesnt become an
entrepreneur is a function of their environment, life
experiences, and personal choices.
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Although no one is born to be an entrepreneur, there are
common traits and characteristics of successful entrepreneurs
A moderate risk taker Optimistic disposition

A networker Persuasive
Achievement motivated Promoter
Alert to opportunities Resource assembler/leverager
Creative Self-confident
Decisive Self-starter
Energetic Tenacious
Has a strong work ethic Tolerant of ambiguity
Lengthy attention span Visionary
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Myth 2: Entrepreneurs Are Gamblers
Most entrepreneurs are moderate risk takers.

The idea that entrepreneurs are gamblers
originates from two sources:
Entrepreneurs typically have jobs that are less
structured, and so they face a more uncertain set of
possibilities than people in traditional jobs.
Many entrepreneurs have a strong need to achieve and

set challenging goals, a behavior that is often equated
with risk taking.
9
Myth 3: Entrepreneurs Are Motivated
Primarily by Money
While it is nave to think that entrepreneurs dont

seek financial rewards, money is rarely the
reason entrepreneurs start new firms.
In fact, some entrepreneurs warn that the pursuit

of money can be distracting.
10
Myth 4: Entrepreneurs Should Be
Young and Energetic
Entrepreneurial activity is fairly easily spread out

over age ranges.
While it is important to be energetic, investors
often cite the strength of the entrepreneur as
their most important criteria in making
investment decisions.
What makes an entrepreneur strong in the eyes of
an investor is experience, maturity, a solid
reputation, and a track record of success.
These criteria favor older rather than younger
entrepreneurs.
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Characteristics of Successful Entrepreneurs
Four Primary Characteristics
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Passion for the Business

The number one characteristic shared by successful
entrepreneurs is a passion for the business.
This passion typically stems from the entrepreneurs belief
that the business will positively influence peoples lives.
Product/Customer Focus
A second defining characteristic of successful
entrepreneurs is a product/customer focus.
An entrepreneurs keen focus on products and customers
typically stems from the fact that most entrepreneurs are, at
heart, craftspeople.
13
Tenacity Despite Failure

Because entrepreneurs are typically trying something
new, the failure rate is naturally high.
A defining characteristic for successful entrepreneurs is
their ability to persevere through setbacks and failures.
Execution Intelligence
The ability to fashion a solid business idea into a viable
business is a key characteristic of successful
entrepreneurs.
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Points Entrepreneur Manager
1. Motive The main motive of an entrepreneur is to Main motive of a manager is to
start a venture for his personal render services in an enterprise
gratification. already set by someone else.
2. Status Owner Servant
3. Risk Assumes risk and uncertainty Manager does not bear any risk
involved in enterprise.
4. Rewards Profits, which are highly uncertain and not Salary which is certain and fixed.
fixed.
5. Innovation Entrepreneur himself thinks over what and A manager simply executes plans
how to produce goods to meet the prepared by the entrepreneur.
changing needs of the customers. Hence
he acts as innovator / change agent.
6. Qualification An entrepreneur needs to possess A manager needs to possess

qualities and qualifications like high distinct qualifications in terms of
achievement motive, originality in sound knowledge in management
thinking, foresight, riskbearing ability etc. theory and practice.
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Social Responsibility
RESPONSIBILITIES TOWARDS CONSUMERS
To produce customized products

To establish fair prices of products consistent with quality,
efficiency and reasonable profit to the firm.
To provide prompt, adequate, courteous, and friendly
service to customers.
To ensure fairly wide distribution of products among all
sections of consumers.
To improve their standard of living in society by producing
goods and services which they need
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RESPONSIBILITIES TOWARDS EMPLOYEES
Fairremuneration
Job security and safety
Proper working conditions and employee
welfare
Trade union rights
Employee promotion and code of conduct
Employee participation in management.
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RESPONSIBILLITIES TOWARDS THE
COMMUNITY
Help the local civic administration to provide better public services

Promote community help by indulging into philanthropical activities
Aid schools, colleges and other educational institutions
Promote cultural enrichment of the community by encouraging greater
appreciation of art, music and drama.
Encourage sports and provide recreational facilities.
Organize community forums and discussion groups and thus promote
better understanding of national and local affairs.
Minimize the problem of pollution and help community efforts in this
direction.
Abandon ostentatious living and display of wealth, and develop socially
desirable standards of living for themselves.
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THE 10 COMMANDMENTS OF CORPORATE
SOCIAL RESPONSIBILITY
1. Take corrective action before it is required.

2. Work with affected constituents to resolve mutual problems.
3. Work to establish industry-wide standards and self-regulation.
4. Publicly admit your mistakes.
5. Get involved in appropriate social programs.
6. Help correct environmental problems.
7. Monitor the changing social environment.
8. Establish and enforce a corporate code of conduct.
9. Take needed public stands on social issues.
10. Strive to make profits on an ongoing basis.
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CRISIS MANAGEMENT
Crisis Management
Crisis management is the process by which

an organization deals with a major
unpredictable event that threatens to harm
the organization, its stakeholders, or the
general public
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Elements of a Crisis
Three elements are common to most

definitions of crisis:
(a) a threat to the organization,
(b) the element of surprise,
(c) a short decision time
(d) a need for change
23
Crisis management - 1
Crisis management consists of:
Methods used to respond to both the reality and

perception of crises
Establishing metrics to define what scenarios
constitute a crisis and should consequently trigger
the necessary response mechanisms.
Communication that occurs within the response
phase of emergency management scenarios
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Crisis Management - 2
The credibility and reputation of organizations

is heavily influenced by the perception of
their responses during crisis situations
25
Crisis Management - 3
* respond to a crisis in a timely fashion makes

for a challenge in businesses.
* must be open and consistent communication
throughout the hierarchy to contribute to a
successful crisis communication process.
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Types of Crises
Natural disasters
Malevolence
Technical breakdowns
Human breakdowns
Challenges
Mega-damage
Organizational misdeeds
Workplace violence
Rumors
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Crisis Management
Technological crises
- caused by human application of science and
technology
- when technology becomes complex and
coupled and something goes wrong in the
system as a whole (Technological
breakdowns)
28
Crisis Management
Crises of organizational misdeeds

- when management takes actions it knows will
harm or place stakeholders at risk for harm
without adequate precautions
29
Crisis Management
Types of crises of organizational misdeeds:

- crises of skewed management values
- crises of deception
- crises of management misconduct.
30
Crisis Management
Crisis management model - Gonzalez-Herrero and Pratt 95

Successfully diffusing a crisis requires an
understanding of how to handle a crisis before
it occurs
- issues management
- planning-prevention
- the crisis
- post-crisis
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Contingency Planning
Plan in advance
Rehearse via simulation
Stipulate who the spokesperson is
Speed and efficiency in response to crisis
Offer accurate information or it will backfire
Plan offers info and guidance to help
decision makers deal with long-term
effects of decisions
32
Role of apologies in crisis
management
Controversial - for fear of legal

outcomes
Evidence says that a compensation
and sympathy are effective
True contrition includes sympathy for
victims and offers of compensation to
offset losses or suffering
33
TOYOTA
CRISIS MANAGEMENT FAILURE
Toyotas communication strategy:

Too little, too late
Beyond the quality problem

Toyota mismanaged the crisis
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TOYOTA
Basic Rules Violated
For senior mgmt: crises must become their

#1 priority immediately.
Integrity of firm threatened - immediate
hands-on control of CEO/team
Sticking accelerators in 2008 - not treated as
a serious matter
35
TOYOTA
Basic Rules violated
Find facts & solutions fast:

- Toyota managers at first in denial
- accepted a patch (remove floor mats), not
solution
- when crisis exploded -- engineering
solution/stopped production
- Even today no one outside of Toyota knows what
the real problems are open to speculation and
rumors
36
TOYOTA
Basic rules violated
Communicate fully and accurately:

- to all constituents to sustain trust
- err on side of protecting consumers &
maintain trust with a recall
What Toyota did:
hushed problem and hoped it go away
37
THANK - YOU
38

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Managerial Skills

Prof. Aparna Kanchan

Creating a new enterprise is one of the

The process of creating a business enterprise capable

It involves deploying resources and people in a unique

An entrepreneur is an individual who creates an

Desire to be their own boss

Desire to pursue their

This myth is based on the mistaken belief that

A moderate risk taker Optimistic disposition

Most entrepreneurs are moderate risk takers.

Many entrepreneurs have a strong need to achieve and

While it is nave to think that entrepreneurs dont

In fact, some entrepreneurs warn that the pursuit

Entrepreneurial activity is fairly easily spread out

Passion for the Business

Tenacity Despite Failure

2. Status Owner Servant

6. Qualification An entrepreneur needs to possess A manager needs to possess

To produce customized products

Help the local civic administration to provide better public services

1. Take corrective action before it is required.

Crisis management is the process by which

Three elements are common to most

Crisis management consists of:

Methods used to respond to both the reality and

The credibility and reputation of organizations

* respond to a crisis in a timely fashion makes

Crises of organizational misdeeds

Types of crises of organizational misdeeds:

Crisis management model - Gonzalez-Herrero and Pratt 95

Controversial - for fear of legal

Toyotas communication strategy:

Beyond the quality problem

For senior mgmt: crises must become their

Find facts & solutions fast:

Communicate fully and accurately:

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