Chapter 1-3 quiz, Entrepreneurship launching a new venture, – Flashcards

Mastery Small steps. Manage to do something and then take a small step further. Modelling Observe others - society, closer sphere. Social persuasion. People around you. How other view tasks.

Entrepreneurship is defined as the process by which individuals pursue opportunities without regard to resources they currently control. The art of turning idea into a business

Corporate entrepreneurship Highly conservative to highly entrepreneurial Entrepreneurial firms Conservative firms

1.Be their own boss 2.Pursue their own ideas 3.Realize financial rewards

Passion for the business.. Product/customer focus.. Tenacity despite failure.. Execution intelligence..

-Whether of a new firm or existing business -Making a difference in peoples lives -Not only a passion -Enthusiastic of an idea but also understand its potential flaws and risks -Most effective business = when passion is consistent with skills in an are representing a legitimate business opportunity. -Two most important elements in a business Focus on right things. -To spot product opportunities - see them through competition -Ability to fashion a solid idea into a viable business -Whether a start-up is successfully or fail -Developing a business model -Putting together a new venture team -Raising money -Establishing partnerships -Managing finances -Leading and motivating employers -The ability to translate thought, creativity and imagination to action and measurable results

- Salary-substitute - Lifestyle - Entrepreneurial

-New product makes life easier -Innovations do create moral and ethical issues with which societies are forced to grapple. -Small firms = providers of a significant share of the innovations -Small business = creators of most new jobs, employ more. -Positive impact of larger firms -Some entrepreneurial firms are original equipment manufacturers, producing parts that go into products that larger firms manufacture and sell.

1.Deciding to become an entrepreneur-- 2.Developing successful business ideas-- 3.Moving from an idea to an entrepreneurial firm-- 4.Managing and growing the entrepreneurial firm--

Entrepreneurs--generates-->New Value--Leads to-->Societal change--Creates-->Entrepreneurial opportunities--Discovered and exploited by--> Entrepreneurs

An opportunity is a favorable set of circumstances that creates a need for a new product, service or business. An idea is a thought. Not all ideas are great business opportunities.

Externally stimulated Decides to launch a firm searches for & recognizes opportunity start a business E.g. selling books online Internally stimulated Recognize problem or an opportunity gap creates business to fill it E.g. Niche products

Observing trends, Solving a problem, Finding Gaps in the Marketplace. --Observing trends-- -Economic Forces- Helpful in determining areas that are ripe for new business ideas as well as areas to avoid E.g. climate, business cycles, income levels (who has money to spend), disposable income, spending patterns (what people spend money on). -Social forces- Social and cultural trends, demographic changes (aging population), level of education, income distribution Often the reason that a product or service exists has more to do with satisfying a social need than the more transparent need the product fills. -Technological forces- Advances in technology frequently dovetail with economic and social changes to create opportunities. Key = how technologies can be used and harnessed to help satisfy basic needs -Political Action and Regulatory changes- E.g. government stability, taxation, foreign trade regulations, war, communism, market economy, legal and regulatory changes (new laws or deregulations of markets) --Solving a problem-- Finding problems in the daily life and then solve them with a product or service. --Finding Gaps in the Marketplace.-- Products that consumers need or want that aren't available in particular location (or at all) Related technique for generating new business ideas is to take an existing product or service and create a new category by targeting a completely different target market.

Opportunity recognition, prior experience, Cognitive factors, Social Network, creativity

Brainstorming, Focus groups, Library and Internet research , Other techniques, Day in the life research

physical or digital repository for storing ideas. E.g. a password-protected location on a firm's intranet that is available only for qualified employees.

any product of human intellect that is intangible but has value in the marketplace. Protected by tools = patent, trademarks, copyrights, trade secrets.

start with what you have - Begins with a given set of means Allows goals to emerge contingently over time from the varied imagination and diverse aspirations of the founders and the people they interact with

strategic. Get what you need - Begins with a pre-determined goal and a given set of means - Seeks to identify the optimal (fastest, cheapest, most efficient etc.) alternative to achieve the given goal

(Managerial) causation, (Action orientation) effectuation

Is the process of determining if a business idea is viable. Is an assessment of a potential business rather than strictly a product/service.

--Recognizing a business idea-- --Testing the feasibility of the idea-- --Writing a business plan-- ---Launching the business-- --If it fails on one or more in the analysis - it should be dropped or rethought. Failing to properly investigate the merits of a business idea before the business plan is written - runs risk of blinding and result in too positive of a plan.--

A description of the product/service - details the features (sketch)---- The intended target market - list of consumers/businesses expected to buy---- The benefits of the product/service - how it solves problem---- A description of how the product/service will be positioned relative to competitors.---- A brief description of the company's management team----

Industry: a group of firms producing the similar product/service. Target market: the limited portion of the industry that it goes after or to which it wants to appeal.

T..w..o p..r..i..m..a..r..y i..s..s..u..e..s..: --Management Prowess-- Two of the most important factors in this area: The passion that the solo entrepreneur or the management team has for the business idea The extent to which the management team or solo entrepreneur understands the market in which the firm will participate --Resource Sufficiency-- Whether the venture has or is capable of obtaining sufficient resources to move forward. Focus is on nonfinancial resources -skills of the employees

--Total Start-Up Cash Needed-- Budget should be prepared - list all the anticipated capital purchases and operating expenses needed --Financial Performance of Similar Businesses-- Gather financial data - online --Overall Financial Attractiveness of the Proposed Venture-- Financial statements: cash-flow, income statement, balance sheet

Maps the four areas of feasibility analysis - the most important points in each area "Overall Potential" - sections that allows suggested revisions to a business idea to improve its potential or feasibility

Buying Intentions Survey. Library, Internet, and Gumshoe Research.

Introduce a new product into an existing market. Introduce a new market to an existing product. Top 3 factors (more receptive to new entrants): Industries that are young rather than old, are early rather than late in their life cycle, and are fragmented rather than concentrated,

Conducted to determine whether a proposed business has sufficient management expertise, organizational competence, and resources to successfully launch a business.

Management Prowess Resource Sufficiency

The passion that the solo entrepreneur or the management team has for the business idea. The extent to which the management team or solo entrepreneur understands the market in which the firm will participat

Whether the venture has or is capable of obtaining sufficient resources to move forward. Focus is on nonfinancial resources -skills of the employees