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1. Of all the forces that foster entrepreneurship, which are the most
relevant ones in the world today?
a. Technological Evolution
b. Organizational Environment
c. Demand Characteristics
Demand is not only unstable, but also never quite homogeneous: customer
preferences are generally diverse enough that parts of the market are always
underserved. This is especially the case when the supply is composed of a
few large generalists providing highly standardized products or services.
Tastes also evolve over time in a predictable manner. For instance,
customers might consider that technical performance is most important for
some time, and suddenly switch their value ordering, for instance toward
design or cost rather than performance once they are technologically
satisfied.
d. Institutional Context
b Drive to achieve
Entrepreneurs are self-starters who appear to others to be internally
driven by a strong desire to compete, to excel against self-imposed
standards, and to pursue and attain challenging goals.
c Opportunity orientation
One clear pattern among successful growth-minded entrepreneurs is
their focus on opportunity rather than on resources, structure, or
strategy.
f Seeking feedback
Effective entrepreneurs are often described as quick learners.
n Vision
Not all entrepreneurs have predetermined vision for their firm. In
many cases this vision develops over time as the individual begins to
learn what the firm is and what it can become.
p Independence
The desire for independence is a driving force behind contemporary
entrepreneurs.
q Team building
The desire for independence and autonomy does not preclude the
entrepreneurs desire to build a strong entrepreneurial team. Most
successful entrepreneurs have highly qualified, well-motivated teams
that help handle the growth and development of the venture.
If you have a brainstorm meeting and dream up dozens of new ideas then
you have displayed creativity but there is no innovation until something gets
implemented. Somebody has to take a risk and deliver something for a
creative idea to be turned into an innovation.
For me, to attempt to draw these three words into too close a proximity of
meaning can stretch them to such a degree that they have no real meaning
at all. As a result, I have worked to make the distinctions clear and use them
not as synonyms, but as separate and important words that add clarity to
understanding the process of innovation.
Creativity has become a core business skill, and entrepreneurs lead the way
in developing and applying that skill. Successful entrepreneurs come up with
creative ideas and then find ways to make them work to solve a problem or
fill a need. In an ever-changing world, creativity and innovation are vital to a
companys success and survival. Sometimes creativity involves generating
something from nothing. When small business owners cannot outspend their
larger rivals, they can create powerful competitive advantages by out
creating and out innovating their larger rivals. Todays successful
businesses live and die according to the quality of their ideas.
At present, the rapid changes are happening so fast that have prompted
today's organizations to ensure their survival by the launch of innovative
products and services with advanced technology, and this requires creativity,
innovation and entrepreneurship.
a. Human Capital
People create knowledge, new ideas, and new products, and they
establish relationships that make processes truly work. Unfortunately,
when people leave, they take along their knowledge, including internal,
external, formal, and informal relationships.
b. Structural Capital
c. External Capital
a Cost
Cost is simpleits the price you are charging for your product or
service. What will your product or service cost? All too often people are
under the impression that the cheaper the product is, the more likely it
is to sell. While that is partially true, companies that only compete on
cost generally dont offer a quality product.
b Quality
The general public does know what to think in terms of quality. The
common viewpoint is that the higher the quality the better. The quality
that is generally assessed is in relation to the standard of excellence.
From an engineering standpoint, the quality of a product relates to the
elimination of variability. If a product goes out the door the same way
every time it is a quality product. If each time a part is ordered it has
a high degree of variation, it is be considered a low-quality product.
This extends also to the customer service you provide.
c Lead
The lead refers to the turnaround time required from the moment the
order is received to the moment the item is in the mail. The fastest
turnaround time exists when items are in stock.
You can think of these three factors as three vertices of a cube, or the
X, Y, and Z axes. While there are three axes, companies usually only
compete in one or two of the three areas.
If a company is known as a high-quality, low-cost company, they will
probably have a longer lead time. Conversely, if they are known as a
high-quality, short-lead company, they will generally demand a higher
price for their goods. The nature of a free market regulates this give
and take.
A company can have the advantage in all three areas only at the point
of a paradigm shift, when a company breaks into a new unsaturated
market. Once a competitor is on the scene, the ability to maintain a
100% advantage is lost.
d Relationship
A fourth factor that fits in with a long-term competitive advantage is
relationship. The three factors above will help you win someone over in
order to build a relationship with them; however, the relationship itself
will give you an edge once it is established.
9 How can small companies build business strategies to exploit all the
competitive advantages that size gives them?
FEASIBILITY ANALYSIS
A feasibility analysis demonstrate to a prospective project owner or
investor that a given concept is financially viable and whether further
study and/or a business plan is warranted.
For a feasibility study, basic data is obtained from the client through a
series of queries, questions and meetings, wherein the client provides
some of the research and other data and facts need to be gained from a
variety of sources.
BUSINESS PLANS
It will also show staffing levels and salaries along with costs of
employment, sales levels with monthly and seasonal trends, setup costs,
building/office costs, utility and telephone costs, legal, insurance and
accounting costs, office furniture and supplies costs and a myriad of other
costs and projections as well as legal requirements and conformation to
regulations.
In addition to the projections and costs, the business plan will feature
sections on demographics, sales and sales methods, objectives,
expansion plans, contingency exercises, product/services market
introductions, regulatory requirements, laws of City, State and Federal
government relating to the business / project and much more.
There are many resources available as a guide to create a business plan. The
seemingly overwhelming task is easily broken down into workable parts that
any entrepreneuror studentcan undertake. Most business plans begin by
including these key elements:
The bound business plan should have a title page and a table of
contents. Each section of the plan has a purpose to accomplish a
specific objective.
d Company History
- Strategic issues such as ease of market entry and exit, the ability
to achieve economies of scale or scope, and the existence of
cyclical or seasonal economic trends further help the reader
evaluate the new venture.
f Business Strategy
This section presents the owners view of the strategy needed to meet
and exceedthe competition. It addresses the question of how to
get there. An entrepreneur must explain how he or she plans to gain
a competitive edge in the market and what sets his business apart
from the competition. The entrepreneur should comment to how he or
she plans to achieve business goals and objectives in the face of
competition and government regulation and should identify the image
the business will project. An important theme is what makes the
company unique in the eyes of its customers. It should outline the
methods the company can use to meet the key success factors.
g Description of Firms Product/Service
This section should describe the companys overall product line, giving an
overview of how customers use its goods or services. Drawings, diagrams,
and illustrations may be required if the product is highly technical. It is
best to write product and service descriptions so that laypeople can
understand them. A statement of a products position in the product life
cycle might also be helpful. It should include a summary of any patents,
trademarks, or copyrights protecting the product or service from
infringement by competitors.
h Marketing Strategy
i Competitor Analysis
j. Plan of Operation
k. Financial Forecasts
One of the most common reasons for creating and reading a business
plan relates for financing. In those cases, this section is critical.
Entrepreneurs must avoid the tendency to fudge the numbers since
some venture capitalists automatically discount an entrepreneurs
financial projections by as much as 50 percent
Building the plan forces a potential entrepreneur to look at her business idea
in the harsh light of reality. It also requires the owner to assess the ventures
chances of success more objectively. A well-assembled plan helps prove to
outsiders that a business idea can be successful. To get external financing,
an entrepreneurs plan must pass three tests with potential lenders and
investors:
a Legal Liability
The reason why most owners incorporate their businesses is to guard
their individual assets. That way, if your company files bankruptcy
proceedings in a court of law, no one can take away your personal
property. Investors choose to incorporate their businesses depending on
the potential and risk involved in the venture. Certain form of ownership
offer business owners greater protection from personal liability for the
financial problems. Entrepreneurs must weigh the potential for legal and
financial liabilities for their companies' obligations.
b Tax
Business owners should also consider tax laws, because some businesses
are taxed heavily than others. Tax rates for each form of ownership
constantly change due to amendments to the tax code. These fluctuations
affect the amount of tax a company pays to the government. Sole
proprietorships and partnerships pay income tax based on their net
earnings, while corporations usually have more tax options.
c Expenses
Sole proprietorships and partnerships are easier to form than other forms
of business. They require less time and money to register. They also do
not have strict operating rules.
There are many different moving parts to consider when you start a
business, and you probably have a handful of different ideas floating around
in your head. The best way to start the process of choosing a name for your
business is by reviewing the foundation of your business. Consider your
mission statement, your business plan and your unique selling proposition.
And don't forget to think about your target audience.
Once you have outlined the guidelines for choosing your business name, it's
time to introduce some creativity.
In fact, the more creative and free-thinking you can be during this stage, the
more ideas you will generate, and the more possibilities you will have to
choose from. You may want to conduct a series of brainstorming sessions,
some with just you, some with a colleague or partner, to come up with as
many business name ideas as possible.
During your brainstorming, you should keep your guidelines in mind, but
allow yourself some unrestricted time to be creative. Some common ways to
start a brainstorming session include brain dumping, list making, mind
mapping and word association. If you're new to brainstorming, review these
brainstorming tips to get started.
c. Give It Time
Now that you have conducted your brainstorming session(s) and have a long
list of possibilities, it's time to review and analyze your results. Go through
your list and remove any non-contenders, sort similar names and mark the
names that immediately resonate with you. This step should take a few
different sessions. It's important to let your ideas, preconceptions and biases
settle before you create your shortlist of best possible business names.
When you have your shortlist of potential business names, walk away, do
something else or sleep on it.
Choosing a name for your business is a big decision and the final result will
stay with you for a very long time. Let your ideas percolate for a day or two,
then come back to it and review again. In many cases, after a brief hiatus,
you will return and instantly know which of your options is the right business
name. And if none of the possibilities feel right, start your brainstorming
process again.
d. Check Availability
Before you officially decide on your business name, you'll want to check to
make sure it's not already trademarked. Search the federal database of the
Department of Trade and Industry. You should also run a series of searches
with Google and other search engines for your desired business name to
make sure there isn't another company already using your name.
Part of your availability search should include a domain name search, if you
intend to have a website to promote your company, products and services. If
your business name is not available as a domain, you may need to use an
abbreviation, hyphens, or an alternate top level domain. Or, you may want to
move down your list of possibilities to the next name if there is a better
domain name available.
e. Register It
Also, this doesnt give you any protection online with other people
purchasing your business web address.
In the end it is far more important how you use your business name
consistently over time, the way your logo and corporate identity works, your
branding, images and packaging etc. It is all those elements together with
your work and behaviour that will make your business name recognised and
remembered by the right people.