Entrepreneurship Lecture 11

8/11/2019 Entrepreneurship Lecture 11

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Cop ri&ht ' ())* b Nelson# a di$ision o% Tho+son Canada ,i+ited

11

STRATEGY: PLANNINGFOR COMPETITIVE

ADVANTAGE

1



Copyright © 2008 by Nelson, a division of Thomson Canada Limited

,EARNIN- OB ECTIVES/. 0e1ne a co+petiti$e ad$anta&e and e2plain

3h an entrepreneur needs to ha$e one to besuccess%ul.

(. 0escribe a ne3 1r+ strate& # and e2plain 3hentrepreneurs need one to protect their pro1ts%ro+ opportunit e2ploitation.

4. 0istin&uish bet3een e5orts to 6eep others %ro+learnin& about or understandin& the businessidea and barriers to i+itation# and e2plain 3hboth are i+portant to entrepreneurs.




,EARNIN- OB ECTIVES7. 0e1ne Arro38s parado2# and e2plain the proble+ o%

disclosure.9. ,ist se$eral barriers to i+itation that entrepreneurs

use.:. Identi% the conditions that %a$our %ranchisin& %ro+

the point o% $ie3 o% both the entrepreneur 3ith anopportunit to e2ploit and potential %ranchisees.

;. 0escribe the strate&ic actions that entrepreneursta6e to +ana&e in%or+ation as ++etr anduncertaint in the entrepreneurial process.




,EARNIN- OB ECTIVES*. E2plain 3h entrepreneurs o%ten start their

businesses on a s+all scale and e2pand i%the are success%ul.

<. E2plain ho3 alliances and partnerships 3ithestablished 1r+s help entrepreneurs toe2ploit their opportunities.

/). ,ist actions that entrepreneurs underta6e to

+a6e their ne3 $entures appear +orele&iti+ate# and e2plain 3h the ta6e theseactions.




=>hat sets us a&ainst one anotheris not our ai+s?the all co+e tothe sa+e thin&?but our +ethods#3hich are the %ruit o% our $ariedreasonin&.@

Saint E2uperWind, Sand and Stars # /<4<


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0E ININ-

CO"PETITIVE A0VANTA-EA co+petiti$e ad$anta&e is anattribute that allo3s a 1r+# andnot its co+petitors# to capture thepro1ts %ro+ e2ploitin& anopportunit .



CO"PETITIVE A0VANTA-EE5ecti$e strate& to protect aco+petiti$e ad$anta&e!

Precludes others %ro+ i+itatin& thebusiness idea per%ectlAllo3s the entrepreneur to capture

the pro1ts %ro+ e2ploitin& theopportunit



BARRIERS TO

CO"PETITIONControllin& ResourcesEstablishin& ,e&al BarriersBuildin& a Reputation %or Satis% in&Custo+ersInno$atin& to Sta Ahead o% theCo+petition







BARRIERS TO I"ITATION Three Co++on Tpes o% Barriers!

/. Obtainin& Control o% Resources(. 0e$elopin& a Reputation F Brand

Na+e4. Inno$atin& to Sta Ahead o% the

Co+petition



CONTRO, O RESOURCESe Resources +a include!

,ease o% spaceE2clusi$e suppl F ser$ice contracts,e&al "onopol

Patent

-o$ern+ent ,icence



ESTAB,ISH AREPUTATION F BRAN0NA"E

Create -ood3illAd$ertise Hea$il

Create E2pectations

Reputation %or E2cellent Custo+erSer$ice







ACTORS IN SE,ECTIN- A"AR ETBASE0 "ECHANIS"

Speed to market

nformationCapabilities

Cost

!arket"#ased !e$hanism



OPPORTUNIT E P,OITATION

,icensin&?contract to use abusiness idea in return %or a %ee

ranchisin&?ri&ht to pro$ide ane2istin& 1r+8s product or ser$ice toend custo+ers



PURPOSE O ,ICENSIN-

/. Unable to obtain suJcientresources to brin& idea to +ar6et

Pri+aril cash(. ,ac6 critical capabilities

no3led&e o% +ar6et# +anu%acturin&F distribution# sales e2pertise

4. Guic6 +ar6et entr Ti+e to asse+ble the entire $aluechain



PRO0UCT ATTRIBUTES

,icencees pre%er products 3ith!/. Intellectual propert protection(. Co+pellin& e$idence that it 3ill

sell4. ,on& li%e e2pectanc and

technolo& 3ith potential to ser$eas basis %or +ultiple products.



RANCHISIN-

Per+its &eo&raphic e2pansionE2pansion 1nanced b ranchisees

Capital CostsHu+an Resources




"ANA-IN- UNCERTAINTAN0 IN OR"ATIONAS ""ETR

-ro3th %ro+ s+all scaleor+in& alliances and partnerships 3ith

established 1r+sCreatin& le&iti+ac %or the opportunitand the ne3 $enture




STARTIN- S"A,,

Uncertaint and in%or+ationas ++etr +a6e it necessar %or

entrepreneurs to start s+all becauseEntrepreneurs +ust sel% 1nanceIn$estors don8t &i$e lar&e su+s all at

onceEntrepreneurs +ust +ini+iKe ris6




BENE ITS O A,,IANCES

/. Opportunities are short li$edEntrepreneurs lac6 ti+e and L tocreate in%rastructure

(. Accessin& international +ar6ets4. ,ac6 o% capital7. Increases reputation

Brand Na+e




POTENTIA, HAMAR0S OA,,IANCES

/. E2ploitation o% siKe and po3er

(. "isrepresentation o% assets Fcapabilities

4. Sun6 in$est+ents utiliKed to

e2tract a di5erent deal7. >ithheld pro+ised resources F

assets



Copyright © 2008 by Nelson a division of Thomson Canada Limited

IT8S ,E-IT

Entrepreneurs de+onstrate thele&iti+ac o% their ideas b

Sho3in& con%or+it to e2istin& rulesand nor+sI+itatin& the routines and procedures

o% e2istin& 1r+sEn&a&in& in collecti$e actionsObtainin& certi1cation

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Entrepreneurship Lecture 11

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