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Detailed Individual Assignment FormatLecture of 22nd February .docx
- 1. Detailed Individual Assignment Format Lecture of 22nd February 2016 General Information “The issue of linking the character traits of an individual to the success of a business – picking winners – needs to be approached with caution.” Burns P (2011, pg 34) Entrepreneurship & Small Business, Palgrave Macmillan 3rd edition Select an ‘entrepreneur’ and analyse their entrepreneurial journey, from the conception of the initial idea through to start- up & ‘growth’. Discuss, with examples, whether or not your analysis supports Burns assertion. Based on your analysis, what do you personally conclude about creating a successful new venture and entrepreneurial success? Part 1: Select an ‘entrepreneur’ and analyse their
- 2. entrepreneurial journey, from the conception of the initial idea through to start-up & ‘growth’. (Approx 300 words) Discuss, with examples, whether or not your analysis supports Burns assertion. Part 2 Internal (Endogenous)factors for his success (Approx 400 words) Part 3 External (Exogenous) factors for his success(Approx 400 words) Based on your analysis, what do you personally conclude about creating a successful new venture and entrepreneurial success? Part 4 (Approx 400 words) Reasons for a successful enterprise Saras Saraswathy entrepreneurship
- 3. For general Introduction: Some interesting definitions An entrepreneur is someone who perceives an opportunity and creates an organisation to pursue it. Bygrave (1997) Use an interesting description or two like this and highlight it. An Entrepreneur is a person who identifies and starts a business venture, sources and organizes the required resources, and takes both the risks and rewards associated with the venture. 1974 Borland talked about entrepreneurs having Internal locus of control 1979 Kirzner talked of them as arbitrageurs - ability to spot opportunities Part 1 Select an ‘entrepreneur’ and analyse their entrepreneurial journey, from the conception of the initial idea through to start- up & ‘growth’. A Chart to save word length on the Entrepreneur’s Journey. (This is a rough draft; you can do it much better!)
- 4. Part Two Endogenous factors Locus of Control Internal locus of control - Individuals who believe themselves to be in control of their own destiny External locus of control - People who believe that their lives are dominated by chance events outside their own control or powerful people i.e. “fate” controls their destiny. 14 Core and Desirable Attributes CORE ATTRIBUTES Commitment & Determination Leadership Opportunity Obsession Tolerance of Risk Ambiguity & Uncertainty Creativity, Self-Reliance and Adaptability (Water Logic) Motivation to Excel DESIRABLE ATTRIBUTES
- 5. Energy, Health, and Emotional Stability Values Capacity to Inspire Creativity & Innovativeness Intelligence THE NON-ENTREPRENEURIAL ATTRIBUTES Being Macho Perfectionist Impulsiveness Being anti- authoritarian Counter/dependency Knows it all Outer Control Invulnerability Timmons (2003:251) 15 Entrepreneurs are at the Centre of so many activities; so they may be specialists in one area, but they have to be generalists.
- 6. Entrepreneur Production Marketing Sales and Finance Banking Audit Legal Technology transfer Suppliers Inventors Transportation Advertising Market Research 16 HBDI Herrmann Brain Dominance Instrument 17
- 7. Most entrepreneurs seem more right-brained than left – though this is a generalization and most entrepreneurs have left brain characteristics as well. Managerial v Entrepreneurial Mindset 19 Of course, endogenous factors are influenced by exogenous factors , so cognitive factors, how you process your information and creativity, are influenced by Prior Experience and Social Networks. Prior Experience Social Networks Cognitive Factors Creativity 20 Exogenous factors (Exogenous)PUSH Unemployment Disagreement ‘Misfit’ No alternative
- 8. PULL (Endogenous) Independence Personal development Personal wealth Recognition Trigger Even in the Reasons For Starting A Business, there are exogenous factors 22 Porter’s Diamond Model Shows why a particular industry does well in a particular country (this is therefore an exogenous factor) Firm Strategy China Example Labour Cost is low Cost of Space (Rentals etc) is low Cost of Company Infrastructure – buildings, equipment etc is low Make their profits through Mass production
- 9. Large Scale of operations Low cost per single Unit Firm Structure Firm Rivalry Rivalry stands for competition. Competition is good for the industry as a whole. In Japan, the car industry is doing well, because there are many car companies – almost ten! With competition, prices go down , and quality goes up. Demand Conditions In Japan, the car industry does well because the local people Want good quality cars Have the money, (the purchasing power) to buy good cars Related and Supporting Industries
- 10. In America, Hollywood is the centre of the American film industry because there are shooting studios, Sound Recording Studios, Editing Studios, Special Effects, all available in Hollywood itself Factor Conditions Labour: In countries with computer software development, you need a ready pool of engineers, technicians, etc And they are relatively cheap. Land is readily available for factories, offices etc Capital (Money) to begin the business and run it (this is provided by government agencies as well as private investors Influences on owner-managers and entrepreneurs – of these, only the first is endogenous, the others are external Antecedent influences Personal characteristics and traits Situational factors Culture of society
- 11. 32 Culture is the collective programming of the mind that distinguishes the members of one category of people from those of another. Hofstede (1988) Would Steve Jobs have flourished in Japan? Mental Models
- 12. Western Thinking Eastern Thinking Individualism Differentiation Relationships Integration 34 Entrepreneurs do one of these three (Endogenous) But these trends, problems and the gap is exogenous. If these had not existed, the business would not have been born. 35 Books to quote from Malcolm Gladwell Outliers Serendipity The right person at the right place at the right time (See Serendipity PPT) Serendipity is being the right person at the right place at the right time. You can quote Malcolm Gladwell’s Outliers.
- 13. 1956 – Bill Gates and all technology entrepreneurs born around this time. Business Success or Failiure LUCK(CALL IT SERENDIPITY) Entrepreneuial character Business culture Business decisions Company strengths 38 This book can be quoted for entrepreneurs from emerging markets The major new trends in global economics, politics, and social life all point toward a "global paradox," according to John Naisbitt — “The bigger the world economy, the more powerful its smallest players." Less advanced countries and small countries benefited by globalisation
- 14. Similarly, as the world economy gets larger, the role that smaller countries play have become more important. BRICS Brazil, Russia, India, China and South Africa The Next Eleven Bangladesh, Egypt, Indonesia, Iran, Mexico,Nigeria, Pakistan, Philippines, Turkey, South Korea, and Vietnam The World Is Flat By Thomas Friedman The world as a level playing field in terms of commerce, where all competitors have an equal opportunity. So, in areas as diverse Information Technology, Medical Tourism, Computer animation & Special effects in movies The world is offering new opportiunities.
- 15. A world where New entrants are welcome You are on par (equal) with everyone else 3) You have a global market to sell your products So JACK MA WAS AT THE RIGHT PLACE AT THE RIGHT TIME. OF COURSE, HE WAS THE RIGHT PERSON TOO. A SUMMING UP OF THIS SECTION IS IN THE NEXT SLIDE – THAT BOTH EXTERNAL AND INTERNAL FACTORS PLAY A PART Innovation Triggering Event Implementation Growth Personal Achievement Locus of Control Ambiguity Tolerance Risk Taking Personal Values Education Experience
- 16. Personal Risk Taking Job Dissatisfaction Job Loss Education Age Commitment Personal Entrepreneur Leader Manager Commitment Vision Sociological Networks Teams Parents Family Role Models Organisational Team Strategy Structure Culture Products Environment Opportunities Role Models Creativity Environment Competition Resources Incubator Government Policy Environment Competitors Customers
- 17. Suppliers Investors, Bankers, Lawyers Resources Government Policy Entrepreneurial Process Bygrave & Zacharakis (2004) 47 Part 4 What makes entrepreneurs entrepreneurial? Saras D. Sarasvathy Causal v Effectual Marketing Process
- 18. 49 • Bird-in-hand principle: Start with What you have - Who you are, What you know, & Whom you know (Not with the opportunity) • Affordable loss principle: Invest what you can afford to lose – extreme case $0 (Not expected return) • Crazy Quilt principle: Build a network of self-selected stakeholders (Not competitive analysis) • Lemonade principle: Leverage contingencies and even failures (Not avoid them) • Pilot-in-the-plane principle: If you can control the future, no need to predict it. The future comes from what people do (Not inevitable trends) Effectual Logic that entrepreneurs employ, as different from others (Saras Sarasvathy) Comparison of Causal & Effectual Model Effectual Reasoning: The Process
- 19. Who they are – their traits, tastes and abilities What they know – their education, training, expertise and experience Whom they know – their social and professional networks 54 Saras Sarasvathy Entrepreneurs usually do what is ‘counter-intuitive’. OTHER REASONS FOR SUCCESS OF ENTREPRENEURS THAT YOU FIND CONCLUSION After reading the Harvard Business Review article on assessing your company’s global potential, post your thoughts and comments on the authors' main conclusions.