Inside the Entrepreneurial

Mind:From Ideas to Reality

(The Sixes)

ENTREPRENEURSHIP

• Entrepreneurship is the result of a disciplined , systematic process of applying creativity and innovation to needs and opportunities in the marketplace .

CREATIVITY-NECESSITY FOR SURVIVAL

Creativity is not only source for building competitive advantages but also necessary for survival

History is not a reliable predictor so should develop new insight

KILLER OF CREATIVITY

Entrepreneur must always guard against traditional assumption and perspective about how things should be

Actually killer of creativity is our own self , self impose restriction and paradigms are killer of creativity

WHAT GLOBAL ENVIRONMENT REQUIRES

Requires following :• Tap their activity constantly• Develop unique ideas• Create solution of problems• Fill a need of timeTo staying leadership position requires constant creativity,

innovation and entrepreneurship

CAN CREATIVITY BE TAUGHT

• RESEARCH SHOWS THAT ANYONE CAN LEARN TO BE CREATIVE

“Every person can be taught techniques and behaviors that helps them generate more ideas”

[ Joyce Wycoff ]

CREATIVE THINKING

• research shows that brain has divided into two hemisphere • the human brain develop asymmetrically , and each

hemisphere tends to specialized in certain function• This phenomenon is known as split-brain phenomenon The brain has divided into following parts :Left hemisphereRight hemisphere

LEFT HEMISPHERE

linear, vertical

thinking

handle languages

logic, symbols

process

information by

steps

narrowly focused

and systemmatic

RIGHT HEMISPHERE

kaleidoscopic, lateral thinking

body emotions spatial

functions

process information intuitively

Unsystematic,

unconventional,

unstructured

HOW TO DEVELOP RIGHT HEMISPHERE

By lateral thinking that lies at the heart of the creativity process, by following we develop right hemisphere :

Always ask question.Challenge customsStaring out the windowGenerate lot of ideasRealize more than one answerPlay mental gamesSee problems as springboard for new ideasHave a helicopter skills

HOW TO CONTROL ON IT ?

• BOTH BRAIN THINKING: Right brain draws on the power of divergent reasoning which is ability to create a

multitude of original, diverse ideas .Left brain thinking counts on convergent reasoning , the ability to evaluate multiple ideas and chose the best solution to a given problem.

• RELY ON THINKING :Entrepreneur need to rely on right hemisphere to generate innovative product, services

or business ideas. Then they rely on left hemisphere to judge the market potential of the ideas they generate .

BARRIERS TO CREATIVITYThe number of potential barriers to creativity is virtually limitless .There are 10 mental lock which limit

individual creativity are as follows :

Searching for the oneFocusing on being logical blindly following the rulesConstantly being practicalViewing play as frivolousBecoming overly specialized Avoiding ambiguity Fearing looking foolishFearing mistakes and failure Believing that I m not creative

How to Enhance Creativity?Embracing diversity

Expecting Creativity

Expecting and Tolerating failure

Encouraging Curiosity

Providing Creativity Training

Providing Support

Rewarding Creativity

Enhancing Individual Creativity (EIC)•Allow yourself to be creative

• Fresh input everyday•Allow mistakes•Handy Authentic info• Listen to others• Talk to a child•Keep a toy•Read books for ideas• Take some time off

The Creativity ProcessPreparation

InvestigationTransformation

Incubation

Illumination

Verification

Implementation

Step 1: Preparation Attitude

Reading Articles Discuss with others Join Associations Analyse Cultures and

Traditions Develop Listening skillsStep 2: Investigation

Look into the matter. Research about the thing. Explore Regarding World.

Step 3: TransformationIt involves viewing the similarities and differences in information collected.

* Convergent Thinking.* Divergent Thinking.

Step 4: Incubation Subconscious step Waiting for the right idea Might be boring Relax and play regularly Waiting is always worthwhile

Step 5: Illumination

oMost awaited phase of processoHappens in between incubationoHappens all of a suddenoReal fruit of being creative

Step 6: VerificationIt is verifying the authenticity of information.

• Ask others• Build prototype• Run simulations• Test marketing

Step 7: Implementation• Time for Execution• Need not to wait• Converting idea into reality.

Ready, Aim, Fire!!!!!!!!!!

BRAINSTORMI

NG• Keeping the group small• No ranks (equality)• Well defined problem• Time limitation• Seating pattern• Throw logic out of the window• Quantity over quality.

PROTECTING YOUR IDEAS

Patents

Trademarks

Copyrights

PATENTS

Patents is grant from the government to the inventor of product, giving the exclusive right to make, use or sell the product.

Limited legal monopoly granted to an individual or firm to make, use and sell its invention, and to exclude others from doing so is called patents.

TRADEMARKS

Trademark is a recognizable insignia, phrase or other symbol that denotes a specific product or service and legally differentiates it from all other products.

Trade dress is the overall commercial image (look and feel) of a product or service that indicates or identifies the source of the product or service and distinguishes it from those of others.

DIFFERENCE BETWEEN TRADEMARK & TRADE DRESS

TRADEMARK TRADE DRESSA “trademark” is any word, name, symbol, or device, or any combination thereof, used by a party to identify and distinguish its goods from those manufactured or sold by others and to indicate the source of the goods.

A “trade dress” is used by a party to identify and distinguish the product of that party from the product of others and to indicate the source of the product.

COPYRIGHTS

Copyright is a legal instrument that provides the creator of a work of art or literature, or a work that conveys information or ideas, the right to control how the work is used. The intent of copyright is to advance the progress of knowledge by giving an author of a work an economic incentive to create new works.

(IPO Pakistan)

It is an exclusive right that protects the creator of original works of authorship such as literary, musical and artistic work.

PROTECTING INTELLECTUAL PROPERTY

Following points ought to be consider anEntrepreneur before bringing lawsuit;

Can the opponent afford to pay if you win?Do you expect to get enough from the suit to cover the costs?Can you afford loss of time, money and privacy?

STRATEGIC MANAGEMENT AND

ENTREPRENEURSHIP

CHAPTER#3

INTELLECTUAL CAPITAL

Collective knowledge of individuals in anOrganization is called intellectual capital.

3 Components of intellectual capital;1) Human Capital2) Structural Capital3) Customer Capital

STRATEGIC MANAGEMENT

Strategic management is nothing but planning for both predictable as well as unfeasible contingencies.

Strategic Management is identification and description of the strategies that managers can carry so as to achieve better performance and a competitive advantage for their organization.

COMPETITIVE ADVANTAGE

A competitive advantage is an advantage over competitors gained by offering consumers greater value, either by means of lower prices or by providing greater benefits and service that justifies higher prices.

STRATEGIC MANAGEMENT

•the process of developing a gameplan to guide a company as itstrives to accomplish its vision,mission, goals, and objectives andto keep it from straying off course

The Strategic Management Process

• Develop a Vision statement and translate it into a meaningful Mission statement.• Strengths and weaknesses.• Significant opportunities and threats facing the business.• Identify the key factors for success.• Analyze the competition.• Create company Goals and Objectives.• Strategic options and Appropriate strategies.• Translate Strategic into Action plans.• Establish accurate controls.

Step 1. Vision Statement

• A vision is the result of an entrepreneur’s dream of something that does not exist yet and the ability to paint a compelling picture of that dream for everyone to see

• Vision provides direction• Vision determines decisions• Vision motivates people

Mission Statement

• What business am I in?

• The purpose of the company: What are we in business to accomplish?• The business we are in: How are we going to accomplish that purpose?• The values of the company: What principles and beliefs form the

foundation of the• way we do business?.

Step 2. Strengths and Weaknesses

• Strengths, positive internal factors that a company can use to accomplish its mission, goals, and objectives.

•Weaknesses ,negative internal factors that inhibit the accomplishment of a company’s mission, goals, and objectives.

Step 3. Opportunities and Threats

• Opportunities, positive external options that a firm can exploit to accomplish its mission, goals, and objectives.

• Threats, negative external forces that inhibit a company’s ability to achieve it mission, goals, and objectives.

Step 4.Key Factors for Success

• Tight cost control• Trained, dependable, honest in-store managers• Close monitoring of waste• Careful site selection

Step 5.Analyze the Competition

•Competitive intelligence •Competitor analysis•Competitive profile matrix•Knowledge managemnt

Step 6.Goals and Objectives

• Goals , the broad, long-range attributes a business seeks to accomplish; they tend to be general and sometimes even abstract.

• Objectives, more specific targets of performance, commonly addressing areas such as profitability, productivity, growth, and other key aspects of a business.

SMART Goal System

•Specific•Measureable •Attainable •Realistic•Timely

Step 7: FORMULATE STRATEGIC OPTIONS AND SELECT THE APPROPRIATE

STRATEGIES

WHAT IS A STRATEGY?

A strategy is a road map of the actions an

entrepreneur draws up to fulfill a company’s

missions, goals and objectives.

IMPORTANCE OF STRATEGY A strategy is the master plan that covers all of the major parts of the organization and ties them together into a unified whole.

A sound strategy, implemented without error, wins every time.

The mission , goals and objectives spell out the ends, and the strategy defines the means for reaching them.

CHARACHTERISTICS OF A SUCCESSFUL STRATEGY

Comprehensive Well integrated Focusing on establishing key success factors

Executable

Strategic Option

• Key Terms

• Business-Level Strategy : Integrated and coordinated set of commitments and

actions the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets

Business-Level Strategy

–

Types of Business-Level Strategy

• Can be used across industries

• Two distinct types of competitive advantage:• Low Cost• Differentiation

• Choice of scope:• Broad• Narrow (niche)

Features of the Five Business-Level Strategies

•Key Terms

•Cost Leadership Strategy :A strategy in which a company strives to be

the low-cost producers relative to its competitors in the industry.

Cost Leadership Strategy

• Low-cost position is a valuable defense against rivals• Powerful customers can demand reduced prices• Costs leaders are in a position to absorb supplier price increases and

relationship demands, and to force suppliers to hold down their prices• Continuously improving levels of efficiency and cost reduction can be difficult

to replicate and serve as significant entry barriers to potential competitors• Cost leaders hold an attractive position in terms of product substitutes, with

the flexibility to lower prices to retain customers

Cost Leadership Strategy and the Five Forces of Competition

• Low cost leadership does not eliminate any of these forces, it just allows the low costs firm to more easily deal with these forces, or offset the power of these forces, and potentially, remain profitable.

How can Low Costs protect against…?

• Processes can become obsolete• Focus on cost reductions can come at the expense

of understanding customer perceptions and needs• Strategy could be imitated, requiring the firm to

increase the value offered to retain customers

Risks of Cost Leadership Strategy

•Key Terms

•Differentiation Strategy :Strategy in which a company seeks to build

customers loyalty by positioning its good and services in unique or different fashion

Differentiation Strategy

• Unusual features• Responsive customer service• Rapid product innovations• Technological leadership

Differentiation Strategy – Features

• Perceived prestige and status• Different tastes• Engineering design• Performance

• To create uniqueness in mind of customer• Cross-functional product development teams• Strong focus on marketing and product • Superior customer service• Product reliability• Creating value in customers eye• Informal rules and procedures

Differentiation Strategy Features

•Quick imitation•No value in uniqueness • Premium price or costs are too high•Costs/Price become more important than

uniqueness•Unwillingness to offer true differentiation• Sustainability

Risks of Differentiation Strategy

• Customer loyalty provides the most valuable defense against rivals• Uniqueness products reduce customer sensitivity to raised prices• High margins (for differentiated products) insulate from supplier

influence • Customer loyalty and product uniqueness serve as significant entry

barriers• Firms with customers loyal to their products are positioned effectively

against product substitutes

Differentiation Strategy and the Five Forces of Competition

Differentiation does not eliminate any of these forces, it just allows the differentiated firm to more easily deal with these forces, or offset the power of these forces, and potentially, remain profitable.

How can Differentiation protect against…?

•Key Terms•Focus Strategy :Set of actions designed to produce or deliver

goods or services to a target consumer based on their needs want and interest in the market

Focus Strategy

• Large firms may overlook small niches• Firms may lack resources to compete in the broader market• Firms may be able to serve a narrow market segment more

effectively than larger, industry-wide competitors• Firms may direct resources to certain value chain activities

to build competitive advantage

Focus Strategy – Reasons

• A competitor may be able to focus on a more narrowly defined competitive segment and "out focus” the focuser.• Focus strategy brings risk .• Small volume of business that some niches support can raise

production cost.• The needs of customers within a narrow competitive segment

may become more similar to those of industry-wide customers as a whole

Risks of Differentiation Strategy

Strategies of small business depends upon its competitive advantage in the market segments.

Well defined strategic advantage may pursue highly aggressive growth. Strategies is an attempt to increase growth and market share

Strategy In Action

• Customer needs• Flexibility• Constant Innovation• Building market niches• Act with lightening speed• Take risk• Maintain cost

Facts of Strategic Development

Strategic plan:

Action plan:

• Assign priorities to project

• Implement the strategic plan

• Delegate adequate authorities

• commitment

Points of Action Plan:

Establish Accurate Controls.

Balanced scorecard:

The balanced is a simple performance measurement framework to a full Strategic Planning and Management System.

A set of measurement, unique to a company that includes both financial and operational measures and give true picture of

Company’s performance.

Balanced scorecard (cont.)

.