GENERATION AND SCREENING OF PROJECT IDEAS

GENERATION OF IDEAS
Stimulating the Flow of Ideas SWOT Analysis Clear Articulation of Objectives
Cost Reduction Productivity improvement Increase in capacity utilisation Improvement in contribution margin Expansion into promising fields

Fostering a Conducive Climate

MONITORING THE ENVIRONMENT

Economic Sector State of the Economy Overall Rate of Growth Growth Rate of Primary, Secondary and Tertiary Sectors Cyclical Fluctuations Linkage with the World Economy Trade Surplus / Deficit Balance of Payment Situation

MONITORING THE ENVIRONMENT

Governmental Sector Industrial Policy Government Programmes & Projects Tax Framework Subsidies, Incentives and Concessions Import & Export Policies Financing Norms Lending Conditions of Financial Institutions and Commercial Banks

MONITORING THE ENVIRONMENT

Technological Sector Emergence of New Technologies Access to Technical Know-How, Foreign as well as Indigenous Receptiveness on the Part of Industry

MONITORING THE ENVIRONMENT

Socio-Demographic Sector Population Trends Age Shifts in Population Income Distribution Educational Profile Employment of Women Attitudes Towards Consumption and Investment

MONITORING THE ENVIRONMENT

Competition Sector Number of Firms in the Industry and the Market Share of the Top Few Degree of Homogeneity and Differentiation Among Products Entry Barriers Comparison with Substitutes in Terms of Quality, Price, Appeal and Functional Performance Marketing Policies and Practices

MONITORING THE ENVIRONMENT

Supplier Sector Availability and Cost of Raw Materials and Sub-Assemblies Availability and Cost of Energy Availability and Cost of Money

CORPORATE APPRAISAL
Marketing and Distribution Market Image Product Line Market Share Distribution Network Customer Loyalty Marketing and Distribution Cost

CORPORATE APPRAISAL
Production and Operations Condition and Capacity of Plant and Machinery Availability of Raw Materials, Sub-Assemblies and Power Degree of Vertical Integration Locational Advantage Cost Structure

CORPORATE APPRAISAL
Research and Development Research Capabilities of Firm Track Record of New Development Laboratories and Testing Facilities Co-ordination Between Research and Operations

CORPORATE APPRAISAL
Corporate Resources and Personnel Corporate Image Clout with Governmental and Regulatory Agencies Dynamism of Top Management Competence and Commitment of Employees State of Industrial Relations

CORPORATE APPRAISAL
Financial and Accounting Financial Leverage and Borrowing Capacity Cost of Capital Tax Situation Relations with Shareholders and Creditors Accounting and Control System Cash Flows and Liquidity

PROFIT POTENTIAL OF INDUSTIRES PORTER MODEL

Potential Entrants Threat of New Entrants Bargaining Power of Suppliers

Suppliers

THE INDUSTRY Rivalry Among Existing Firms

Threat of Substitute Products Substitutes

Bargaining Power of Buyers

Buyers

SCOUTING FOR PROJECT IDEAS

Analyze the Performance of Existing Industries

Examine the Inputs and Outputs of Various

Industries Review Imports and Exports Study Plan Outlays and Governmental Guidelines Look at the Suggestions of Financial Institutions and Development Agencies Investigate Local Materials and Resources

SCOUTING FOR PROJECT IDEAS

Analyze Economic and Social Trends Study New Technological Developments Draw Clues for Consumption Abroad

Explore the Possibilities of Reviving Sick Units

Identify Unfulfilled Psychological Needs Attend Trade Fairs Stimulate Creativity for Generating New Product

Ideas

PRELIMINARY SCREENING
Compatibility with the Promoter It Fits the Personality of the Entrepreneur It is Accessible to Him It offers him the Prospect of Rapid Growth and High Return on the Invested Capital

PRELIMINARY SCREENING
Consistency with the Government Priorities Is the Project Consistent with the National Goals and Priorities? Are there any Environmental Effects Contrary to Governmental Regulations? Can Foreign Exchange Requirements of the Project be Easily Accommodated? Will there be Any Difficulty in Obtaining the License of the Project?

PRELIMINARY SCREENING
Availability of Inputs Are the Capital Requirements of the Project within Manageable Limits? Can Technical Know-How Required for the Project be Obtained? Are the Raw Material Required for the Project Available Domestically at a Reasonable Cost? If the Raw Materials Have to Be Imported, Will there be Problems? Is the Power Supply for the Project Reasonably Obtainable from External Sources and Captive Power Resources

PRELIMINARY SCREENING
Adequacy of Market Total Present Domestic Market Competitors and Their Market Share Export Markets Sales and Distribution System Projected Increase in Consumption Economic, Social and Demographic Trends Patent Protection

PRELIMINARY SCREENING
Reasonableness of Cost Cost of Material Inputs Labour Costs Factory Overheads General Administrative Expenses Selling and Distribution Cost Service Cost Economies of Scale

PRELIMINARY SCREENING
Acceptability of Risk Level Vulnerability of Business Cycles Technological Changes Competition from Substitutes Competition from Imports Governmental Control Over Price and Distribution

SOURCES OF POSITIVE NET PRESENT VALUE

Economies of Scale Product Differentiation Effective Advertising and Superior Marketing Exceptional Service Innovative Product Features High Quality and Dependability

SOURCES OF POSITIVE NET PRESENT VALUE

Cost Advantage Accumulated Experience and Comparative Edge on the Learning Curve Monopolistic Access to Low Cost Materials A Favourable Location More Effective Cost Control and Cost Reduction

SOURCES OF POSITIVE NET PRESENT VALUE

Marketing Reach
Technological Edge Government Policy Restrictive Licensing Import Restrictions High Tariff Walls Special Tax Reliefs

ON BEING AN ENTREPRENEUR
1.

Are my goals Well Defined?

Personal Aspirations Business Sustainability and Size Tolerance for Risk Clear Definitions Profitability and Potential for Growth Durability Rate of Growth

2.

Do I have the Right Strategy

ON BEING AN ENTREPRENEUR
3.

Can I Execute the Strategy?

Resources Organizational Infrastructure The Founders Role

QUALITIES AND TRAITS OF A SUCCESSFUL ENTREPRENEUR

Willingness to Make Sacrifices Leadership Decisiveness

Confidence in the Project

Marketing Orientation Strong Ego