2

Question 1

How Managers deal with uncertainty

Answer 1

• no personal financial risk
• much information available (e.g. market research)
• operating under low uncertainty
• data available -> scenario forecast -> plan (decide between scenarios)

focus: planning and prediction

Question 2

How Entrepreneurs deal with uncertainty

Answer 2

• bears all financial risk
• new risky products in highly dynamic environments
• little information about decision alternatives

focus: skills, knowledge, resources

Question 3

Types of uncertainty Risks

1-4

Answer 3

1 Market risk
2 product risk
3 regulatory risk
4 financial risk

Question 4

1 Market risk

Answer 4

• risk that market will not accept product/service after launch
• every business has some degree of market risk

Question 5

2 product risk

Answer 5

• product that product is not delivered within the available resources (time, money)
• product may not solve the problem exactly as hoped/promised

Question 6

3 regulatory risk

Answer 6

• change in regulations/laws that effect industry or business
• can change framework of an industry/cost-structure, etc.

Question 7

4 financial risk

Answer 7

• chance of business cash flows are not enough to pay creditors and fulfill financial responsibilities

Question 8

Strategies to cope with uncertainty

Answer 8

• work towards goals?
• try to predict the future?
• outperform their competition?

Question 9

Think Aloud experiments, Saras D. Sarasvathy

Answer 9

• is there a difference between expert entrepreneurs vs. non-expert entrepreneurs as concern how they would deal with risks & returns in highly uncertain situations?
• 27 Expert Entrepreneurs
• comparison between normal people to other groups

Question 10

Entrepreneurial process vs. non-entrepreneur

Answer 10

Entrepreneur:
1 Define resources
2 Decisions based on resources
3 create best possible output

Non-Entrepreneur:
1 Define goals
2 Decision based on goals
3 Define Resources

Question 11

The Entrepreneurial Process

Question 12

Questions to assess your means

1-3

Answer 12

• Who am i?
• What do i know?
• Whom do i know?

Question 13

Process of assessing your means

1-3

Answer 13

1 Asses
- what are your strengths?
- what are you good at?

2 Reflect
- in which context did you use your strengths?
- which skills and knowledge were required in this situations?

3 Transfer
- in which context do I want to apply my skills & knowledge?
- which is the closest context for me to use my skills & knowledge?

Question 14

Risk and Return (non-entrepreneurs vs entrepreneurs)

Answer 14

non:
Step 1: pick a target return
Step 2: reduce risk using insurances etc.
- e.g. return is 25% on equity (Deutsche Bank)

entrepreneurs:
Step 1: pick a comfortable level of risk
Step 2: creatively increase return
- don’t like risks
- starting company is already risky
- seeks to eliminate risk step by step

Question 15

Contingencies

Answer 15

Unvorhergesehenes, Eventualitäten

• non-entrepreneurs avoid contingencies
• entrepreneurs use them to create new opportunities
• Bsp: Potato chip = guest complained about potato being to thick; post-it = glue developed that isn’t sticky

Question 16

The Golden Circle

1-3

Answer 16

1 Why
- reason why they exist
- very few organizations know why they do it
- “change the market, save the planet”

2 How
- that’s what makes them special
- some know it, some dont
- “good car design, good specifications”

3 What
- products or services they sell
- “cars”

Question 17

Simon Sinek

Answer 17

Start with Why: People dont buy what you do, they buy why you do it

Question 18

Personality can developed via

1-4

Answer 18

• Education
• Social Networks
• Cultural influence
• Coaching

Question 19

Idea Generation

1-3

Answer 19

1 Space Ideas:
crazy, laughable, whacky, absurd
Students don’t like long case studies: „teleport to mangers bodies“

2 Blue sky ideas:
Forward looking, novel, different, unique
Students don’t like long case studies: create a management online game

3 Grounded ideas:
safe, incremental, obvious
Students don’t like long case studies: create videos of case studies

Question 20

From Idea to opportunity

1-2

Answer 20

1 Serve a need: Pain of customer
- biggest frustrations
- major obstacles
- needs
- fears

2 Create a need: Gain of customer
- needs
- desires
- goals and successes
- customers strategies of achieving goals

Question 21

Analysis of Market & competition

Factors 1-5

Answer 21

• Market size & structure
• market growth
• market entry barriers
• customer
• competitive advantage

Question 22

Analysis of Financials

1-4

Answer 22

• gross margin
• time to break-even
• capital intensity
• R&D expenses