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International Journal of Management and Applied Science, ISSN: 2394-7926
http://iraj.in
Volume-3, Issue-3, Mar.-2017
A STUDY ON EXPERIENCES OF INDIAN ENTREPRENEURIAL
COMMUNITIES
1
VISHNU A. PATANKAR, 2NIKHIL K. MEHTA
1
Research Scholar (NITIE, Mumbai), 2Associate Professor (NITIE, Mumbai)
E-mail: [email protected], [email protected]
Abstract— Max Weber and many western scholars criticized Hindu social systems and hold responsible for hindrances in
Indian economic progress. However, the various Indian communities maintained the legacy of entrepreneurship and
impression of their footprint left over on the Indian economy. This research manuscript aims to understand, are there any inter
or intra differences in the way the entrepreneurs from different community of India approaches business? Are there any inter or
intra differences in their entrepreneurial orientations (EOs) and what is the impact of socio-psychological antecedents viz.
personal values and perceived entrepreneurial environment on their EOs. India's planned economy is exhibiting remarkable
economic development. Like traditional form of Marwari-Gujarati entrepreneurship other Indian communities are also
emerging in modern version of technological entrepreneurship. This study tries to identify the challenges facing by these
communities and by its comparison their strengths and weaknesses.
Index Terms— Entrepreneurial orientation, Personal values, Entrepreneurial Community
I. INTRODUCTION
II.
Incredible India is one of the fastest developing
countries in the world known for her vibrant cultures,
customs, and diversity. India embodies entrepreneurs
coming from several communities like Banias,
Marwaris, Chettiars, Guajarati, Punjabis, Sindhis,
Boharies, Shettys have been very prominent Indian
entrepreneurial communities who have established
their benchmark. Each community has its own
environment which may affect the way its member
think, feel, and interact socially.
The word entrepreneurship has been perceived
differently since "entreprendre" got defined as
connotation to do something, during last eight hundred
years [1]. Meaning of the word 'entrepreneur' was
transformed from "manager of the public musical
company" [2] to "innovative & creative" ([3]-[4]),
"risk manager" ([5]-[7]), "venture creator" [8],
"Dynamo of economic system" ([9]-[10]) "resource
manager" ([11]-[13]). Entrepreneurship is the ability
to create and build something from practically
nothing. It is a knack of sensing opportunity where
others see chaos, contradiction and confusion [14].
These interactions creates specific settings in these
communities exist. Entrepreneurs hence operate either
in their natural settings or create new settings in which
they can contribute and yield profits. In very short time
span, Indian economy transformed from agricultural
to
industry-service
oriented
economy
as
entrepreneurship grew. Banias, Marwaris, Parsis,
Chettiars, Gujaratis are the major to start industrial
entrepreneurship in India. Other Indian communities
also started following the entrepreneurial trends set by
these communities and enter into the small scale
sector. Nowadays, small scale sector played a vital
role in developing the Indian economy.
REVIEW OF LITERATURE
It is an attitude of mind to seek opportunities, take
calculated risks and derive benefits by setting up a
venture. It comprises of numerous activities involved
in conception, creation and running an enterprise. In
the past review of literature on entrepreneurship
establishes its association with several antecedents
such as entrepreneurial traits, behavioral skills,
orientations and have been found to be associated with
entrepreneurial growth, performance, organizational
strategies, entrepreneurial strategic posture (ESP),
customers and marketing orientations [15].
The world Economic Forum summit held at
Davos-Klosters discussed in depth about the progress
made by Indian entrepreneurs in developing
innovation and start-up culture in the country. The
Indian
government
is
also
focusing
on
entrepreneurship development and appealing investors
across the world to come to India and be part of the
success story of Indian economy. This research paper
tries to understand and learn from the experiences of
various Indian entrepreneurial communities pursuing
their businesses in the light of the global changes that
are taking places in Indian economy.
In India a few communities with trading, money
lending & financing background dominated in
entrepreneurship [16]. Marwari, Gujarati, and Parsi
communities are the dominant business communities
in India [16]. About Parsis, though they are small in
number but their entrepreneurial contribution to the
country is enormous [17]. Other active communities
also include the Punjabis, Chettiars, and
Maharashtrians [17]. Marwari, from Rajasthan have
the most geographically migrated business
community; pursuing businesses all over the country
controlling almost half the industrial assets [18].
A Study on Experiences of Indian Entrepreneurial Communities
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International Journal of Management and Applied Science, ISSN: 2394-7926
http://iraj.in
Volume-3, Issue-3, Mar.-2017
diversity. Marwari, Gujarati and Parsis are leading
entrepreneurial communities of India [17]. These
communities collectively controlled 62 of the 100
largest companies in 1989. Punjabis, Chettiars, and
Maharashtrians are among others active communities.
These communities share their distinctive tenors.
Gujaratis were traditionally traders with countries in
the Middle East and East Africa. Parsis, from the small
minority Zoroastrian community in India, and
traditionally played the role of intermediaries with
Europe. The Parsis of India are perhaps the world's
smallest ethnic community whose entrepreneurial
contribution to India has far exceeded their size in
numbers . Marwari, a demographically small segment
originally from the state of Rajasthan in western India,
have been the most geographically spread business
community, pursuing businesses all over the country.
Das estimated that the Marwari controlled half the
industrial assets of India [18]. The Chettiars the
community from South India once upon a time were
much bigger than the Marwari and the Parsis in terms
of capital during pre-independence . These
communities have contributed and brought some
specific values in their entrepreneurial endeavor. In
case of other Indian communities, the factors
influencing entrepreneurship were found mostly in
sociological, economical, cultural and psychological
domain. In the present times, entrepreneurships
research has move beyond big business to smaller
firms, family business and network and diasporic
community [21].
A. Entrepreneur & Entrepreneurship:
As India has been characterized by social, cultural
diversity and diversity of religions [19], it would be
interesting to study how entrepreneurs coming from
different entrepreneurial communities posit on
necessary and sufficient conditions of business i.e.
values, traits of entrepreneurs, perception of working
entrepreneurial environment and entrepreneurial
orientation. Based on these several definitions
discussed
above
of
entrepreneurship,
the
characteristics of entrepreneur include the followings:
 Sensing and exploring opportunities,
 innovativeness & creativity,
 leadership and controlling qualities,
 resource management
 risk management,
 strong achievement desires,
 visionary thinking
B. Entrepreneurship in Developing Countries:
In any developing country entrepreneur is always at
the centre of the economic development process and
s/he has to play a major role in it. Bamfo in his
dissertation indentified government of developing
nation, education, financial institutions and
entrepreneurs as main stakeholders of the
entrepreneurship development [20].
Figure 1: The Entrepreneurship Triangle: Source: Modified
from [20]
D. Role of Personal Values in Entrepreneurship
Values represent an individual's standard or ideal
about what a person object even or activities ought to
and affect one's attitude [22]. Role of personal values
in entrepreneurship have received little attention [23].
Understanding personal values as drivers behind
businessman's choice of success criteria has
importance on health, well-being and profit [24].
Values regulate and guide human behaviour and
action in our day-to-day life. Values are embedded in
every word we select and speak, what we were, way in
which we interact, our perception and interpretation of
others reactions in what we are, say and or so on .
Among developing countries India has always been
compared to China, whether in terms of population,
economics and entrepreneurial development. China
has been requested to be far more involved in the lives
of its citizens, and certainly far more intrusive with
respect to civil liberties than India, but on the other
hand, India is much more hostile to entrepreneurship
compare to volume of its population.
C. Entrepreneurship in Indian background
India is known for its unique cultural dimensions
which may have an impact on functioning of societies,
groups, individual and businesses. Cultural practices
and people's aspirations are influence by the religion
[19]. India has been characterized by religious
Values are formed on the basis of interacts, choices,
needs desires and preferences. These comprise the
nuclei of values formation. Values have selective or
directional quality. Vitell et. al., in their study
concluded that personal characteristics (values and
beliefs) play an important role in ethical decision
making in business [25]. Vinson et. al., while,
analyzing the role of personal values in marketing and
consumer behaviour explained the personal values in
different point of views [23]. An anthropologist sees
the values in life style and cultural patterns of the
people. A sociologist focuses on ideologies and
customs, whereas psychologist examines it as attitude
and motives standpoint.
A Study on Experiences of Indian Entrepreneurial Communities
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International Journal of Management and Applied Science, ISSN: 2394-7926
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Values direct our thoughts and action [26]. Rokeach
defined values as, "multifaceted standards that guide
conduct in a variety of ways" [27]. Values lead us to
take particular positions on social issues and they
predispose us to favours one ideology over another. To
review ourselves and others values are used standards.
Lin studied entrepreneurial behaviour and
characterized entrepreneurial behaviour at three levels
highlighting entrepreneur's values and important
dimensions [12]. Entrepreneurs' values play an
important role in the business. Halis et. al., studied the
personal features of entrepreneur and posited that
values are the motivators and driving factors in
entrepreneurial decisions [28]. Martin & Cullen in
their Meta analytical study posited that personal belief
and values constitute the one's moral reasoning and
decision criteria [29].
IV. RESEARCH METHODOLOGY
An open-ended questionnaire shown in Table 1 was
administered on small entrepreneurs from nearby
industrial area and business premises of Mumbai city.
The micro and small entrepreneurs, who are involved
in various business activities like hotel,
pharmacy-medical store, jewellery manufacturer and
traders, grocery store, automobile stores etc., were
interviewed.
This questionnaire basically tries to identify the
perceptions of entrepreneurs about the physical
environment and to know how these entrepreneurs are
facing challenges to sustain in the business. How the
physical environment, their values, and abilities are
helping them to develop innovativeness, risk ability
and proactiveness to acquire the benefits of the
market.
E. Entrepreneurial Orientation (EO)
Entrepreneurial Orientation (EO) of an entrepreneur is
psychological endowment which plays an important
role in entrepreneurship development [30]. Miller
reported that individual's entrepreneurial orientation
and its' dimensions viz. innovativeness, proactivness
and risk-taking ability may create an impact on
entrepreneurial decision making [31].
Kreiser et. al., studied this psychometric properties of
entrepreneurs and labeled it as entrepreneurial
strategic posture (ESP) as degree of innovativeness,
and risk ability of an entrepreneur's enable him/her to
proactively take a strategic position in the business
scenarios [32].
Aragon-Correa et. al., posited that EO plays major role
in environmental strategy and it' practices [33], where
Eggers et. al., pointed out that SME's characteristics
can be distinguished with their EO and customer
orientation [34]. A significant contribution has been
made by numerous authors emphasizing on
entrepreneurial orientation (EO) and linking it with
growth, profitability and performance of SMEs
([7]-[8]; [35]).
III.
Volume-3, Issue-3, Mar.-2017
Table 1: The Questionnaire used for Preliminary Qualitative
Study
RESEARCH OBJECTIVES
This research paper specifically focuses on two of the
communities, Marwari and Gujarati, which are
well-known for their entrepreneurial knack and the
other communities which are putting their efforts in
entrepreneurial activities. This paper tries to identify
what is the specialty about these established
entrepreneurial communities? Secondly what triggers
them to become successful entrepreneur, so that other
upcoming communities can learn a lesson from these
traditional entrepreneurial communities? The
entrepreneurs from other communities are also
included so that comparison can be made. Moreover,
this article tries to understand how the entrepreneurial
environment is perceived and the challenges faced by
these entrepreneurs belonging to the different
communities.
The characteristics of the responses collected from
various respondents are shown in following table-2. It
distinguishes category of business, community of the
respondents and gender.
A Study on Experiences of Indian Entrepreneurial Communities
94
International Journal of Management and Applied Science, ISSN: 2394-7926
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Table 2: The type of business, Communities and Gender of the
Indian entrepreneurs
The responses from 30 different micro and small
entrepreneurs were interviewed with open-ended
questions [36]. Their responses tabulated in four broad
categories viz. their (i) perception about physical
environment (ii) the ability to face the challenges,
(iii) Values and emotions and (iv) entrepreneurial
orientation i.e. innovativeness, risk taking ability and
proactiveness. Base on these responses during the
interview the following table 3 is created to distinguish
the difference among various communities.
V. DISCUSSIONS
The table-3 distinguishes various influencing factors
perceived by entrepreneurs
from different
communities. Based on this table 3 the following
inferences are made:
Volume-3, Issue-3, Mar.-2017
 Among these respondents Marwari & Gujarati
were found equip with spring-board to jump
further level of entrepreneurship. Probably
community network, cohesiveness within
community and entrepreneurial family
background, entrepreneurial values inculcated
from generation to generation may be helping
Marwari and Gujarati entrepreneurs to be
more successful and established. Other
communities like South-Indian, North-Indian
and Maharashtrian are to prepare on other
fronts of entrepreneurial knack viz.
networking, skill development and resilience
while doing business.
 Majority of the respondent replied that they
have problem of finance except Marwaris.
They always think due to lack of finance they
are not able to do a business properly. Next to
it, their main concern was lack of skilled
manpower, then cut-throat competition. They
have problem of adapting with technology
changes too. But no one could reply for their
own competitive advantages, their uniqueness,
and abilities, innovativeness. They are just
driving away with the environment. Prima
Facie they feel the environment is good for
business, but their expectations from
government and their counterparts are more.
For perceived environment we received mix
responses. Some stated its’ a good, conducive
environment for business while some said its'
volatile, ups and downs.
Table 3: Indian Communities and differences among their entrepreneurial approaches
confidence among them. They are probably in
confused state of mind, one side they are not
willing to pay to labor force well, but expect
too much from them. No provisions were
 During the entire process of interviewing these
small entrepreneurs, researcher found lack of
A Study on Experiences of Indian Entrepreneurial Communities
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International Journal of Management and Applied Science, ISSN: 2394-7926
Volume-3, Issue-3, Mar.-2017
http://iraj.in
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