Midterm Flashcards
Kondratieff cycle
intervals of high economic growth followed by slow growth
conventional wisdom and why wrong:
people thought no jobs were being created, but they were just small business entrepreneurial
entrepreneurial management
way company is run: exploration of new opportunities for satisfying human wants and needs
Global Entrepreneurship Monitor Project
measures level of entrep activity, uniform definitions and data collection, however it is comparing activity in developed and developing countries, necessity entrep has no effect on economic development while opportunity entrep has pos and sig effect,
necessity entrep
few other options, subsistence jobs, manual labor, farming, artisinal, not creating jobs and value
opportunity entrep
identifying needs, goal centered, growth, resources available, passion
ratio of opportunity over necessity is most important
to measure economic growth
economic history of us
big business growth during industrial revolution, economists focused on equilibrium, 1970s everything in downturn lost jobs, but these were made up and more by women and baby boomers, 1975-85 small business growth not all high tech
general national framework conditions
openness, gov, financial markets, r&d, infrastructure, management, labor markets, rule of law, going from phase 1 to phase 2
entrepreneurial framework conditions
risk capital, r&d transfer, education and training, internal market, openness, access to physical, infrastructure, cultural norms, country encouragement w skills and motivation of people themselves
policy implications for zoltan acs article
less developed: focus on firms, employing people, large business
developing countries: strong commitment to education, strengthen roots for entrep
developed: higher ed, strengthen tech transfer, university level
design thinking
integrative, iterative, different perspectives, immediate feedback, efficiency,
personal profile of design thinker
empathy, integrative thinking, optimism, experimentalism, collaboration
elements of design thinking
ideation, inspiration, implementation
human centered design
looking for a need, based on observation, human error, move from expert centric to user centric
sources of innovation
through experience, seeing others, sensing needs etc
bug lists
noticing problems that bug you, mental or jot down
work arounds
people who compromise or use something a different way to solve their own problem
observation and extreme users
understand the people who use certain products and why they use them
causal reasoning
established company, has resources info customers etc, goal and apply resources towards it, max profits, prediction and planning, competitive analysis
effectual reasoning
start ups, means (who are, who know, what know), affordable loss, lemonade principle, crazy quilt, flexible
affordable loss
expend little money, lose less
lemonade principle
open to surprises, life gives you lemons
crazy quilt
made w whatever resources already have, no order
managerial thinking
causal, selecting between given means to achieve predetermined goal
strategic thinking
effective causal, generating new means to achieve pre-determined goal
entrep thinking
effectual, imagining possible new ends using given set of means
suicide quadrant
new market new product, where traditional marketing techniques are ineffective but entrepreneurs should flourish
sustaining innovation
makes incremental improvements, high end market, causal reasoning, info exists
disruptive innovation
effectual reasoning, below low end of market, low resources, but emerges into something better and bigger
principles of disruptive innovation
customers dont want it, high risk, doesnt meet growth needs, no info, tech, flawed business model, customer/stakeholder disatisfaction
RPV
resources
process
values: foundation for previous 2
hard to change values and processes when they have been working
home for disruption in established co
hire separate team to capture disruptive innovation
kirznerian opportunities
come from errors, sustaining innovation, existing info, low risk
shumpeterian opportunities
new info, disruptive innovation, creative, high risk high reward
3 aspects: tech, regulative/political, social/demographic
capitalism
evolutionary process, never constant, companies/industries destroyed, creative destruction to innovation
oligopoly
few firms, max profits
previous assumption about capitalism and growth
big business creates competition and jobs, want for perfect equilibrium of efficiency and regulation, no such thing as perfect competition
creative destruction
solve a problem, can undo preexisting ways, competition based on other than price meaning quality and product differentiation, constant innovation
new industry creation
tech change produces novel opportunity that entrepreneurs can seize
job creation
small businesses have generated 65% of net jobs
current entrep trends
digital anonymity, domestic manufacturing, big data, lean startups
process of becoming an entrep
home based, serial (startfind mentor, build network, learn about it, understand preferences, acquire new skills, study industry
skills needed
critical thinking, embracing uncertainty, resource gathering, story telling, vision, decision making
5 categories of innovation
new product, new process, new market, new sources of supply, changes in industrial organization
discovery opportunity
see opportunity from shifts in external factors, systematic approach
creation theory
entreps create opportunities, act and then see customer response, no planning needed
business model
strategic decisions and tradeoffs entreps can make to earn profit…value proposition, customer segments, distribution channels, business activities, strategic partners, revenue sources and cost drivers
why business models fails
flawed logic, limited strategic choices, imperfect creation and capture assumptions, false assumptions about value chain
changing business model
incrementally expand, revitalize established model, take existing model into new areas, acquisition,
feasibility
convert uncertain opportunity into one that has specific level of risk
new product design
shorter life cycles bc of technology, efficiency, cost reduction, innovation, robust products
reasons for product failure
lack of good market analysis, technical problems, poor execution, time to market increases, first to market opportunities are missed
product development cycle
customer identification, customer validation/design, business creation
prototype development
preliminary way of testing what may become your product
genchu gembutsu
go see for yourself
validated learning
setting out to find info, successfully executing plan that leads nowhere, learn along the way
value hypothesis
whether product or service really delivers value
growth hypothesis
tests how new customers will discover the product
concierge mvp
used more for services, ask people to get feedback
mvp
early prototype, product design, test assumptions
antilog
proves/disproves assumptions, has anyone validated the assumption yet
imvu
case study of what not to do, released product with out feedback and knowing what customers actually wanted
zappos
mvp, took pics of shoes for “website” to validate his assumption
village laundry
started small, not extremely trustworthy, people were willing to pay
capturing value
making money, building sustainable business
creating value
product differentiation, design
idea vs opportunity
idea you value, opportunity others value
Drucker, conventional wisdom 1965-85
Everything was over, collapse of manufacting, job loss…. But really they increased net jobs through small business women and baby boomers
Conventional wisdom of schumpeters time
Equilibrium, bigness, gov business labor triad, however he disagrees
Antilog
Assumption that’s Been disproven, people still wanting to rent movies at stores
Avg age of entrepreneur
39
% people who get ideas from previous jobs
70-90
50% net new jobs
At companies with fewer than 20 people
High tech founders w Ph.D.
10%
True or false: earn more as self employed entrepreneur
False
True or false: most startups get venture capital
False
60% of small business family owned
True
Are immigrants more likely to start a business
Yes 30% more likely
