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Managing Entrepreneurial
Growth
LECTURE 8
Entrepreneurship
Technology
(BPTW 4012)
Growth
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Organizational changes
during growth
Entrepreneur must give up some
decision making authority
Corporate culture changes from small to
larger business
Such changes are often difficult for the
entrepreneur and other founding
members to adapt to
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Making the transition as an entrepreneur
whos business has grown
Communicate all matters to key employees
Be a good listener
Be willing to delegate responsibility
Provide feedback regularly and consistently Provide continuous training of key employees
Emphasize results to key managers withincentives built in to encourage them to trainand delegate within their roles
Establish a we spirit not a me spirit inmemos and meetings
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New skills for the entrepreneur
Record keeping and financial control
Inventory control
Human resources Marketing skills
Strategic planning skills
Time management skills Negotiation skills
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Growth Strategies
Penetration ProductDevelopment
Market
Development
Diversification
Market
Product
Existing
New
NewExisting
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Strategies
Penetration- Growth By Selling More OfExisting Product To Existing Customers
Market Development
New Geographic MarketNew Demographic Market
New Product Use
Product Development- Sell New Products ToExisting Customers
Diversification- Sell New Product To NewMarket
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Pressures On Firm Growth
1. Existing Financial Resources
2. Human Resources
3. Management Of Employees
4. Entrepreneurs Time
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OvercomingFinancial Resources Pressure
Manage Cash Flow- Budget vs. Actual
Manage Inventory
Manage Fixed Assets Manage Costs/Profits- Compare Actual
vs. Standard Percentages
Taxes Record Keeping
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Generic Strategies
In conjunction with differentiation
Economies or diseconomies ofscale
Capacity utilization achieved
Linkages w/ suppliers & distributors
Cost Leadership
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Generic Strategies
Many price-sensitive buyers
Few ways of achieving differentiation
Buyers not sensitive to brand
differencesLarge # of buyers w/bargaining power
Low Cost Producer Advantage
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Generic Strategies
Greater product flexibility
Greater compatibility
Lower costs
Improved service
Greater convenience
More features
Differentiation
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Generic Strategies
Industry segment of sufficient size
Good growth potential
Not crucial to success of major competitors
Focus
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Three strategies for managing fast
growth
Scaling
Duplication
Granulation
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Scaling doing more of what you
are good at
Focus on concrete product, technology, orcustomer segment
Invest aggressively Expand product development around core
technologies, expand product lines, increasemarketing using existing channels to reach newgroups
Specialize and standardize
Hire the right mix Adapt the structures
Learn from customers
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Duplication: Repeat the business
model in new regions
Balance standardization and adaptation
Hire flexible, independent managers
Duplicate key parts of the infrastructure Duplication entrepreneurial knowledge
Be aware of the limitations
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Granulation: Growing select
business cells
Focus on specific areas of business
Balance the old and the new
Balance formal and informal Evaluate and monitor
Learn from customers, partners, and
competition
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Bear Opportunities
Leverage your relationships
Advertise value propositions
Control costs Pursue traditional marketers
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Total Quality Management (TQM)
Definition :
Internally from the firms view and it
measured in terms of compliance with
determined product specifications orstandards with minimum defects
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Corporate Entrepreneurship
As a process to create new ventures within abusiness corporate
Characteristics of a Corporate entrepreneur Proactive
Innovative Propensity to make moderate and calculated risk
Inspiration to do more than current capacity
Team work
Creative problem solving Listening the feedback
Need for achievement
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Innovation
Spotting and exploiting opportunities
quickly
Definition
Is the process of implementing new ideas of
turning creative concepts into realities
2 phase of Innovation:
Creating an idea
Make sure it results in something new
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Sources of Innovation
Technology The types and pattern of activity, equipment and
material, knowledge and experience used toperform task
Customers Annoying habit of expecting-demanding
Competitors All business need to know what their competitors
are doing
Creativity
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Types of competitor
There 3 types of competitor
Direct competitors
Compete against on a day-to day basis
Close competitors
Those that similar, but not identical
products/services
Indirect competitors More varied
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What we can learn from competitors?
Products and services
Product line
Promotional activities Distribution
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Creativity
Is the ability to generate novel and useful
ideas and solutions to everyday
problems and challenges
Being creative is seeing thing as
everybody else but thinking of something
different
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Why is creativity a major source of
innovation?
innovation is usually regarded as the
successful exploitation of news ideas,
creativity clearly has a major role to play
during the early stage of innovation andnew products/ service development
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Thank you
Champions believe in themselves even if no one else
does. In order to succeed, we must first believe that
we can. They can because they think they can.
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