Documente Academic
Documente Profesional
Documente Cultură
Entrepreneurial Ventures
1. Independently
owned and
operated
2. Not dominant in
its field
3. Not engaged in
innovative
practices
1. Primary goals
profit and growth
2. Innovative
strategic practices
Entrepreneur as Strategist
An entrepreneur as a person who organizes
and manages a business undertaking and
who assumes risk for the sake of a profit.
He is known as the ultimate strategist.
He or she makes all the strategic as well as
operational decisions.
All three levels of strategy- corporate,
business, and functional-are the concerns
of this founder and owner-manager of a
company.
Entrepreneurs
are
strategic
planners
without realizing it.
Degree of formality
Strategic planning will be more informal
than in large corporation in small
businesses and entrepreneurial ventures
Too much formalization also reduces
productivity of the organization
Strategic planning can be used by banks
and venture capitalists when the
entrepreneur is searching for capital
It is dysfunctional to small firms to make
structured plans and written document
because small firms are far more flexible
Strategy
Formulation
Scanning
External
Societal
Environment
General Forces
Task
Environment
Industry Analysis
Internal
Structure
Chain of Command
Culture
Beliefs, Expectations,
Values
Strategy
Implementation
Evaluation
and
Control
and Control
Mission
Reason for
existence
Objectives
What results
to
accomplish
by when
Strategies
Plan to
achieve the
mission &
objectives
Policies
Broad
guidelines for
decision
making
Programs
Activities
needed to
accomplish
a plan
Resources
Assets, Skills
Competencies,
Knowledge
Budgets
Cost of the
programs
Procedures
Sequence
of steps
needed to
do the job
Process
to monitor
performance
and take
corrective
action
Performance
Feedback/Learning
Formulate strategy
Determine policies
Establish programs
Specify procedures
Corporate Governance
1. Simpler in entrepreneurial firms
2. Owner as manager
3. No board unless incorporated
4. Closely-held firms have passive
boards
Advisory board
A group of external business people
voluntarily meeting with owner to
discuss strategic issues
Most
small
business
ownermanagers rely more on internal as
opposed to external sources of
information.
Five forces of competition analysis is
impossible because small local
business do not analyze the
competitors remained in wider
geographic scope.
Small business owner or managers
personal and family needs strongly
affect a small businesss mission and
Sources of innovation
Peter Drucker proposes seven sources for
innovation that should be monitored in
starting an entrepreneurial venture.
1. The unexpected
.An unexpected success, an unexpected
failure, or an unexpected outside event can
be a symptom of a unique opportunity
2. The incongruity /unease
.A discrepancy between reality and what
everyone assumes it to be or between
what is and what ought to be can create an
opportunity for innovation.
5. Demographics
. Changes in the populations size, age structure,
composition, employment, level of education,
and income can create opportunities for
innovation.
6. Changes in perception,mood,and meaning
. Opportunities for innovation can develop when a
societys
general
assumptions,attitudes,and
beliefs change.
7. New knowledge
. Advances
in
scientific
and
nonscientific
knowledge can create new products and new
markets
. Advances in two different areas can sometimes
be integrated to form the basis of a new product.
Industry structure
The chances for success are more in
rapidly changing industries than
stable industries.
Prospects are better in early, high
growth stages of development.
Competition is often less intense
Fast growth market also provides the
mistakes without serious penalty.
The patents does not provide
competitive advantage in a high
tech or in hypercompetitive industry.
Business strategy
The keys to success for most new ventures
are
1. To differentiate the product from those of
other competitors in the areas of quality
and service
2. To focus the product on customer needs in a
segment of the market in order to achieve a
dominant share of that part of the market.
.Adopting guerrilla warfare tactics, these
companies go after opportunities in market
niches too small or too localized to justify
retaliation/reject from the market leaders.
A
new venture analyzes its
competitors to assess their likely
response to the companys entry
into the market.
To continue its growth once it has
found a niche, an entrepreneurial
firm can emphasize continued
innovation and pursue natural
growth in its current markets.
The firm can also expand into
related markets in which the
companys core skills, resources,
and facilities offer the keys to
Entrepreneurial Characteristics
The
followings
are
the
entrepreneurial characteristics to a
new venture success
1. The ability to identify potential
venture opportunities better than
most people
.Focus on opportunities not on
problems
.Try to learn from failures
.Goal oriented
.Visionary
4. Access
to
outside
help
to
supplement
their
skills,knowledge,and abilities
.Networking, making friends who
have key skills and knowledge
.Close
relationships
with
investors,partners,creditors,and
employees.
Stage B : Survival
Those ventures able to satisfy a sufficient
number of customers enter in this stage
The rest close when their owners run out
of startup capital.
Those reaching out this stage are
concerned about generating cash flow
needed to repair and replace capital
assets.
They are concerned to finance the growth
to continue satisfying the market segment
they have found
The organization structure is simple
Stage C : Success
The firm is not only profitable but has
sufficient cash flow to reinvest in itself.
The issue in this stage is whether the
company should be used as a platform
for growth or as a means of support for
the owners.
The company will transformed into
functional organization
The entrepreneur still will have full
control over the firm
The two options are
1. Disengagement
.The company will follow stability strategy
.The company will remain in this stage
forever
.The environmental changes does not
destroy its niche
.Poor management reduce its competitive
abilities
.The company will be incorporated
.The BODs will be rubber stamp
.The strategic management decisions are
based on personal desires and the
founders background
2. Growth
.The entrepreneur risks all available cash
and borrowings to finance further growth
.Strategic and operational planning are
extensive and deeply involve the owner
.Visionary managers are hired
.The firm wants to remain at fortune 500
lists
.The company will follow team work rather
than entrepreneurs personal desires
.The personal values and philosophy of the
founder are transformed to the culture.
The End