L8 - Managing Entrepreneurial Growth

7/28/2019 L8 - Managing Entrepreneurial Growth

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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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L8 - Managing Entrepreneurial Growth

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