Towards an Alternative Methodology for Identifying Entrepreneurial Potential in a Regional Setting

Abstract

Industrial location in India is more of a political than economic question. Location policy has often been developed according to the political interests and need of governments. Entrepreneurship development, which is more of a recent strategy, falls particularly in line with these political compulsions. Targeting of entrepreneurship development initiatives is a vexed problem. Given a scientifically structured entrepreneurship development model, the target group has been decided in terms of factors such as: 1) formal skills of particular target groups (eg: Science and Technology Entrepreneurship Development Programme); 2) Skill concentration in a region (eg. Regional programme like the Special Employment problem); 3) Social groupings (ex. women's programmes and SC-ST programmes. While such targeting, apparently, is helpful for a balanced development of entrepreneurship skills in the economy, several evaluations have indicated that these criteria fail miserably in achieving the primary objective; generation of first- generation entrepreneurs. Several evaluations of Entrepreneurship Development Programmes (EDPS) have attributed such failures to 1) improper selection of trainees and poor quality of training inputs; and 2) failures of the post training strategies, such as poor escort services by the implementing agencies or non-cooperation by financial institutions. Targeting is not based on an understanding of the objective situation. But external compulsions (like availability of finance, government directives, political reasons etc.). The implementation of EDP models is not often scientific. A model of EDP become a relevant strategy only when it is presented as a social intervention guided by a sense of collective responsibility. However, the experience today is that they are not interventions involving any collective responsibility. The yardsticks of evaluation are more quantitative than qualitative. Therefore. the task of "entrepreneurship creation" is left particularly to the programme implementation agencies and success/failure are defined in terms of often unscientific guidelines. For instance, the bankability of the project proposals has been considered as an important yardstick of successful entrepreneurship initiatives. However, bankability itself is often a very vague concept such that, even the most viable project proposals get rejected by bankers. Going by the first principles of entrepreneurship, any entrepreneur is person who influences the situation to his advantage. The more genuine budding entrepreneurs often try to overcome such constraints by finding alternative sources of finance. But, unfortunately, some development finance institution and several governmental agencies do not count them as "successful" entrepreneurs. The Above discussion leads us to the need for comprehensive models of EDP which take into account the linkages at various stages of entrepreneurship development such as: pre-prornotional, promotional, implementation and follow-up strategy. This paper attempts the outline of such a model.