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| The process by which new products and technologies developed by entrepreneurs over time make current products and technologies obsolete; stimulus of economic activity |
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| Businesses that provide their owners the opportunity to pursue a particular lifestyle and earn a living while doing so |
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| Entrepreneurial (Growth) Firms |
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| Companies that bring new products and services to market by creating and seizing opportunities |
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| Small firms that yield a level of income for their owner or owners that is similar to what they would earn when working for an employer |
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| Four characteristics of successful entrepreneurs |
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1. Passion for the Business
2. Product/Customer Focus
3. Tenacity Despite Failure
4. Execution Intelligence |
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| The relationship between a condition or variable and a particular consequence, with one event leading to the other |
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| The relationship between a capable of or that is successful in producing a desired result. |
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| You would be creating the perfect blend of product development and pricing to create value |
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| A business or marketing statement that summarizes why a consumer should buy a product or use a service. This statement should convince a potential consumer that one particular product or service will add more value or better solve a problem than other similar offerings. |
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| The process of creating something new, which is central to the entrepreneurial process. |
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| The event that prompts and individual to become an entrepreneur. |
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| Four qualities of an opportunity |
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1. Attractive
2.Timely
3. Durable
4. Anchored in a product, service or business that creates or adds value for its buyer or end user |
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| Myth 1 About Entrepreneurs |
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| Entrepreneurs are born, not made. This myth is based on the mistaken belief that some people are genetically predisposed to be entrepreneurs. |
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| Myth 2 About Entrepreneurs |
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| Entrepreneurs are Gambler and Big Risk Takers. The truth is that entrepreneurs are moderate risk takers. |
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| Myth 3 About Entrepreneurs |
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| Entrepreneurs are motivated primarily by money. Don't be naive entrepreneurs do seek financial rewards as a means to pursue and grow their ventures. |
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| Myth 4 About Entrepreneurs |
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| Entrepreneurs should be young and energetic. Entrepreneurial activity is fairly evenly spread out over age ranges. |
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| Myth 5 About Entrepreneurs |
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| Entrepreneurs love the spotlight. Many entrepreneurs, because they are working on proprietary products or services, avoid public notice. |
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| An Entrepreneur recognizes a problem and creates a business to fill it. |
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| The time period in which a firm or entrepreneur can realistically enter a new market. |
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| Three ways to identify an opportunity |
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1. Observing Trends
2. Solving a Problem
3. Finding Gaps in the Marketplace |
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| Environmental trends that suggest potential opportunities |
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1. Economic Forces
2. Social Forces
3. Technological Advances
4. Political and Regulatory Changes |
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| The Process of generating a novel or useful idea. |
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| A technique used to quickly generate a large number of ideas and solutions to problems; conducted to generate ideas that might represent product or business opportunities. |
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| States that once an entrepreneur starts a firm and becomes immersed in an industry, "corridors' leading to new venture opportunities become more apparent to the entrepreneur than to someone looking in from the outside. |
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| Relationships characterized by frequent interaction that form between like-minded individuals such as coworkers, friends and spouses; these relationships tend to reinforce insights and ideas that individuals already have and, therefore, are not likely to introduce new ideas. |
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| Relationships characterized by infrequent interaction that form between casual acquaintances who do not have a lot in common and, therefore, may be the source of completely new ideas. |
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| The process of perceiving the possibility of profitable new business or a new product or service. |
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| Entrepreneurial Alertness |
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| The ability to notice things without engaging in deliberate search. |
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| The Four Elements of Feasibility Analysis |
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Definition
1. Product/Service
2.Industry/Target Market
3. Organizational
4. Financial |
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| Product/Service Feasibility |
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| Is an assessment of the overall appeal of the product or service being proposed. Demand and Desirability. |
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| Is an assessment of the overall appeal of the industry and the target market for the product or service being proposed. Attractiveness |
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| Organizational Feasibility |
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| is conducted to determine whether a proposed business has sufficient management expertise, organizational competence, and resources to successfully launch its business.Management Prowess and Resource Sufficiency. |
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| Is the final component of a comprehensive feasibility analysis.Start-Up Capital, Performance of similar businesses, Overall financial attractiveness of the proposed venture. |
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| Is a template for completing a feasibility analysis. It is a entrepreneur's initial pass at determining the feasibility of a business idea. |
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| Who Reads A Business Plan and What are they looking for? |
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| A Firms Employees and the Investors and other External Stakeholders. |
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| Is a 10-15 page document that pitches an idea of a business, authors may be asking for funding to conduct the analysis needed to write a full plan. |
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| Is a 25-35 page document that spells out a company's operations and plans in much detail and is in a format to inform an investor of the business. Usually used to get financial backing. |
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| Operational Business Plan |
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| This is a 40-100 document used for internal audience of the business and to help guide operational managers. |
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| An analysis that breaks the industry into segments and zeros in on the specific segment to which the firm will try to appeal. |
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| An explanation in a new firm's business plan of the sources of the numbers for its financial forecast and the assumption used to generate them. |
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| Sources and uses of funds |
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| Is is the layout of specifically how much money a firm needs, where the money will come from, and what the money will be used for. |
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1.Threat of Substitutes
2.Threat of New Entrants
3.Rivalry Among Existing Firms
4.Bargaining Power of Suppliers
5.Bargaining Power of Buyers |
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| When the threat of substitutes is low this means that products or services from other industries can't easily serve as substitutes for products or services being made and sold in the focal firm's industry. |
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| Competitors cannot easily enter the industry to copy what the industry incumbents are doing. |
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| Rivalry Among Existing Firms |
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Four Primary Factors:
Number and Balance of competitors
Degree of difference between products
Growth rate of an industry
Level of fixed costs |
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| Bargaining Power of Buyers |
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| Buyers can suppress the profitability of the industries from which they purchase by demanding price concessions or increases in quality. |
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| Bargaining Power of Buyers |
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| Buyers can suppress the profitability of the industries from which they purchase by demanding price concessions or increases in quality. |
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| Business research that focuses on the potential of an industry. |
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| New industry in which standard operating procedures have yet to be developed |
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| Consolidating the industry and establish industry leadership. |
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| Is experiencing slow or no increase in demand, has numerous repeat customers and has limited product innovation. |
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| When an industry is experiencing a reduction in demand. |
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| When an industry is experiencing significant international sales; many start-ups enter global industries for the wider range of market value. |
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| A detailed evaluation of a firm's direct and future competitors. |
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| The information that is gathered by a firm to learn about its competitors. |
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| An international expansion strategy in which firms compete for market share by using the same basic approach in all foreign markets. |
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| An international expansion strategy in which firms compete for market share on a country by country basis and vary their product or services offering to meet the demands of the local market. |
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| A company's plan for how it competes, uses it resources, structures its relationships, interfaces with customers, and creates value to sustain itself on the basis of the profits it generates. |
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| Business Model Innovation |
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| Initiative that revolutionizes how products are sold in an industry. |
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| The overall manner in which a firm competes relative to its rivals. |
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| A unique skill or capability that transcends products or markets, makes a significant contribution to the customer's perceived benefit, is difficult to imitate, and serves as a source of a firm's competitive advantage over its rivals. |
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| Sustainable Competitive Advantage |
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| A competitive advantage that is sustainable normally as the result of the unique combination of a firm's core competencies and strategic assets. |
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| Generic strategy in which firms strive to have the lowest costs in the industry relative to competitors' costs and typically attract customers on the basis of price. |
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| A strategy that firms use to provide unique or different products to customers. |
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| Business Concept Blind Spot |
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| An overly narrow focus that prevents a firm from seeing an opportunity that might fit its business model. |
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| A range that defines the products and markets on which a firm will concentrate. |
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| The process of adapting a company's core competencies to exploit new opportunities. |
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| The string of activities that moves a product from the raw material stage, through manufacturing and distribution, and ultimately to the end user. |
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| A network of all the companies that participate in the production of a firm's a product, from the acquisition of raw materials to the final sale. |
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| Are the firms resources that help build the business model. |
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| Are the partners that new ventures rely on to play key roles in their business model to make their businesses work. |
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| How a firm interacts with its customer, and how the type of customer interaction depends on how firm chooses to compete. |
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| This is one of the most important things the founders of an entrepreneurial ventures can do is establish a strong ethical culture for their firms. |
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| Is a formal statement of an organization's values on certain ethical and social issues. |
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