Unit 8- Entrepreneurship Flashcards
What are the 3 stages of entrepreneurship?
identifying an opportunity,evaluating that opportunity evaluation,and exploiting that opportunity in the marketplace.
What is entrepreneurship?
Entrepreneurship is a process by which individuals either on their own or inside the organisations pursue opportunities without regard to the resources they currently control
What is the entrepreneurial culture?
a people & empowerment focus, commitment & personal responsibility, employees doing the ‘right thing’, value creation through innovation & change, freedom to grow & fail,
What are the 3 key drivers for entrepreneurship?
independence, financial & pursuit of a new idea
Why is entrepreneurship so relevant?
Entrepreneurship is essential to create value for customers & organisations - and for the economy as a whole
What is innovation driven by?
Innovation is not something that happens automatically. It is driven by entrepreneurship. Innovation is a tool that entrepreneurs use to exploit change as an opportunity for a different product, process or service.
Why do entrepreneurs try to bring something new into the world?
Entrepreneurs try to bring something new into the world (service, product & process innovations) to achieve strategic advantage
Who is entrepreneurship relevant to?
starting up, advisory & employees
What is the process of entrepreneurship?
discovery, opportunity evaluation & exploitation
What is opportunity creation?
new creation of market when demand or supply does not exist, ideas evolve & are shaped
What is opportunity recognition?
If supply & demand already exist then you must bring them together
What is opportunity discovery?
if demand exists & supply does not, then you must create supply & vice versa
What are the IDEO 3 lenses?
IDEO 3 lenses: desirability (does anyone want it & who are they?), feasibility (is it going to work?) & viability (what value will it have in the market?)
What is the revenue model?
how the business will deliver value to the customers at an appropriate cost in order to be profitable
What is entrepreneurial orientation?
innovativeness, risk taking & proactiveness
What are Shapiro’s 4 conditions to become an entrepreneur?
- an individual must have a participating event (a displacement), 2. the individual must have the propensity to to act on displacement (disposition to act), 3. they must see the idea of starting a business as feasible & 4. they must be able to access the resources they need to start a business (they all all necessary)
What is formal, social & active learning?
Formal learning: learning from experts, Social learning: learning from others & Active learning: learning by doing
What is intrapreneurship?
Intrapreneurship can happen in large companies, social enterprises & public sectors
What are the start-up options?
own idea (alone or in a team which means they own intellectual property, freelancer) or external ideas (e.g. franchising or licensing which means benefitting from someone else’s intellectual property, can reduce risk & support market entry, but limits you as you don’t own intellectual property)
What is the traditional approach to start-ups?
business plan with a summary of the operational & financial objectives of the business, information about how objectives will be realised & includes market, product, team, finances & more
What is the new approach of start-ups?
The Lean Start-up which applies scientific approach
Who is an intrapreneur?
Intrapreneur is an employee who is given freedom and financial support to create new products, services & systems, who do not have to follow company’s usual routines or protocol’s. Generally same as entrepreneur but in larger cooperations.
What is corporate entrepreneurship?
Corporate entrepreneurship (CE) is about encouraging opportunity-seeking & innovation in a systematic manner throughout the organisation, seeking ways to improve & create competitive advantage
Who are social entrepreneurs?
Social Entrepreneurs (SE) are entrepreneurs with a social mission. (they play the change agent in social sector)
What is the underlying drive for social entrepreneurs?
Underlying driver of SE is to create social value rather than to create personal or stakeholder wealth e.g. for profit, non-profit, co-operative, hybrid organisations
What are the 4 liabilities of newness (challenge for start-ups)?
- lack of skills, routines & systems, & experiences required to operate, 2. lack of history, 3. lack of social capital & 4. lack of financial capital
What are the implications for the 4 liabilities of newness?
costs, mistakes, inefficiencies, difficult to access resources & trust issues
How can start-ups overcome these challenges?
newness can be an asset: clean slate, responsive, flexibility & naivety (be enthusiastic, learn new information, take risks and give it a go)
What are disadvantages of large firms?
excess of bureaucracy, power of accountants, managers being ‘administrators’, cumbersome internal communications (slow reaction to external change) & power of investors in public companies
How do large firms vs small firms compare?
large firms have material advantages (financial & technical resources), small firms have behavioural advantages (entrepreneur, flexibility, responsiveness, greater enthusiasm of staff, lack of bureaucracy). Large firms need a big opportunity capable of generating multi-dollar return whereas smaller firms can pursue much smaller opportunities
What are the factors influencing probability of failure?
firm’s age (the longer a firm survives, the less likely it is to fail), size (failure is more likely in small firms), growth history (start-ups that grow in a shorter amount of time less likely to fail) & sector (variation)
What are the personal costs of failure?
financial loss, emotional costs, psychological costs, social costs, loss of self-esteem & entrepreneurial costs (less likely to begin another start-up)
