Entrepreneurial Management: Key Concepts

Entrepreneurial Management

• The practice of taking entrepreneurial knowledge and using it to increase the effectiveness of new business ventures and small- to medium-sized businesses.

Entrepreneur

• An individual who creates a new business.
• They bear most of the risks and enjoy most of the rewards.
• They are commonly seen as an innovator.
• Entrepreneurs are a source of new ideas, goods, services, and business procedures.

Groups of Entrepreneurs

• Founders: People who create or start a new business.
• Franchise: Someone who buys, rents, or leases a pre-packaged business from a franchisor.
• Buyers: People who purchase an existing business.
• Heir: A person who becomes an owner through inheriting or being given a stake in a family business.

Four Key Ideas

• Planning + Action = Success.
• A plan without action is futile and actions without plans are often wasted.
• Success results from having the right plan.
• Successful entrepreneurs seek advice from other entrepreneurs, from experts, potential customers, or even professors.
• Those who seek help succeed to a greater extent and more often.
• Do Good: In the long run, one depends on partners, investors, customers, and neighbors.
• Trying to do well in business leads to feeling better about one's business and life and the same goes for those around you.

Entrepreneurs and Firm Growth Strategies

• Lifestyle or part-time firms: Small businesses intended to provide supplemental financial support for the owner's desired lifestyle, often through flexible operations.
• Traditional Small Business: A firm intended to provide a living for the owner.
• It operates consistently with other firms in the industry and market.
• High-performing Small Business: A firm intended to provide the owner with high income via sales or profits surpassing those of traditional small businesses.
• High-growth Venture: A firm established with the intention of eventually going public, following the growth patterns of a large business.

Why Become an Entrepreneur?

• Common reasons include "For the money" or "To do things my way."
• Nearly all entrepreneurs highlight three key benefits: flexibility, a livable income, and personal growth.
• Other rewards include building wealth and developing products, mentioned more often by entrepreneurs than typical workers.
• Social rewards, like respect or admiration and family rewards, like continuing a family tradition, are also factors.

Popular Rewards for Small Business Owners

• Growth Rewards: Personal satisfaction derived from overcoming challenges.
• Income Rewards: The money earned from owning one's own business.
• Flexibility Rewards: The ability to structure life according to personal needs.
• Universally mentioned rewards by small business owners include the desire for greater flexibility for personal and family life.
• Another universal reward for small business owners is the ability to give themselves, their spouse, and their children financial security.
• Growth is another universal reward for small business owners: the desire to continue to grow and learn as a person.
• Occasionally mentioned rewards by small business owners include the chance to build great wealth or a very high income.
• Another occasional reward by small business owners: the desire to develop an idea for a product.
• Rarely mentioned rewards include recognition, admiration, power and the desire to continue a family tradition.

Myths About Small Business

• Common Myths: There's not enough financing; you can't start a business during a recession; you need to make something to make profits; if you fail, you can never try again.
• Another common myth about small business is that the skills aren't there to start a business.
• These myths hold back potential entrepreneurs.
• Knowing the facts around these myths is a powerful way to maintain motivation for starting a business.
• When encountering naysayers, it's important to verify information and conduct thorough research.

Getting Started: Entry Competencies

• There are numerous ways to start a business, but some are better than others.
• The answer sometimes comes from an opportunity or offer, but other times, one must initiate the first steps.
• Starting a business requires four elements: Boundary, Resources, Intention, and Exchange.
• The presence of the four elements is referred to as the BRIE model.

The BRIE Model

• Boundary refers to something that sets a firm apart from regular buying, selling, or bartering.
• Resources are assets that set a firm apart from casual buying, selling, or bartering.
• Intention is the desire to start a business, the most frequent element of the BRIE Model.
• Exchange involves moving resources, goods, or services to others in exchange for money or their resources.

Small Business and the Economy

• Small businesses matter at an individual level through rewards gained from ownership.
• Small businesses are also vital to communities and the economy.
• Small businesses introduce new elements to the economy, particularly new jobs and new innovations.
• They also provide essential jobs, taxes, and products or services.
• According to a 2019 study by the Department of Trade and Industry, MSMEs generated 5,510,760 jobs, accounting for 62.4% of the country's total employment.
• Small businesses are the engine of job creation, but also support existing job, providing wages and salaries to millions of Filipinos.
• Small businesses foster innovation within the economy, offering a unique environment for new ideas to flourish.
• Owners are freer from judgment and social constraints.
• Austrian economist Joseph Schumpeter termed this process 'creative destruction'.
• This refers to how new creations can negatively impact or replace existing goods, services or firms.
• People who own their own business are presented with tremendous opportunities.
• Entrepreneurial opportunities not only improve quality of life, they help those entrepreneurs move upward in the economy and society.
• Small businesses offer communities a type of opportunity, providing goods and services.
• They address local needs like grocery stores or pharmacies.
• Small businesses adapt to local needs, profiting where larger stores cannot like a grocery store that stocks fishing supplies catering to fishing fans.
• For cities, the ability to stand on their own, is driven through variety of small businesses.

Aspects of Global Entrepreneurship

• Factor-driven economy: A nation driven by farming and extractive industries.
• Major forces for jobs, revenues, and taxes with in these countries are found in forestry, mining, or oil production.
• Efficiency-driven economy: A nation where industrialization is becoming the major economic force.
• Efficiency-driven economy involves providing jobs, revenues, and taxes, optimizing productivity by minimizing cost.
• Innovation-driven economy: An economy where the major forces for jobs, revenues, and taxes come from high-value-added production.
• Innovation-driven economies thrive through new ideas and professional services building on higher education.

Types of Entrepreneurship

• Opportunity-driven entrepreneurship: Creating a firm to improve income or a product or service.
• Necessity-driven entrepreneurs: Creating a firm as an alternative to unemployment.
• E-commerce uses the Internet to create businesses with worldwide reach.
• It's a method that has grown dramatically with sites like Ebay and Amazon, or Lazada and Shopee.
• The formal term for e-commerce is Virtual Instant Global Entrepreneurship (VIGE).

Challenge and the Entrepreneurial Way

• Entrepreneurial stories frequently highlight the challenges that have been overcome.
• Entrepreneurs' commonly use effective strategies and reuse them over and over.
• Try again, this is perseverance.
• If you can't get the resources that you need consider scaling back the idea to the level of resources you have.
• Instead of planning a firm and then looking for resources, start with the resources you already have.
• Pivot by starting a business in a way that you can when you figure it out along the way: always look for these opportunities!
• Take it on the road: Sometimes the place you live isn't the best market for your products or services.

Further keys to the Entrepreneurial Way

• Ask for help: Use connections on Facebook can get feedback, opinions, advice etc.
• Crowdsourcing based on internet ideas/opinions through the collective involvement of a group.
• Plan to earn; plan to act on your capabilities, passions and prospects.

End of Lecture

• Key ideas and common myths about small business were explored.
• It's important that the work of both small and large business founders were seen.
• Society benefits from small business through new jobs, ideas, and opportunities.
• The key focus for getting small businesses started is assisting people who want a business, helping them take steps.
• Helping entrepreneurs accomplish these goals is the overall objective of the course.

Topics

• ROI & its significance.
• Elements of ROI.
• Calculating ROI.
• Challenges.
• Time - the missing dimension.
• Summary.

Chapter 1: Mindset

• "If you really want to do something, you'll find a way. If you don't, you'll find an excuse." -Jim Rohn

Are you Ready?

• To determine if mentally ready, first, establish the proper mindset for the work ahead!
• Fixed Mindset includes: "I give up easily" "My potential is predetermined" "Failure is the limit of my abilities".
• Growth Mindset includes: "I can learn to do what I like to try new things" and "Failures offer opportunity for growth".

CEO and Architect

• Deciding to open your own design practice requires a fundamental shift in attitude toward the making of architecture.
• Need to prioritize learning to be a business person over being an architect.
• It just means that design will have a different place in your operations and occasionally, it may even defer to your business decisions.

Amateur Versus Professional

• There's an important distinction between practicing your craft as an amateur and doing it as a professional.
• There is a professional obligation to uphold: being unflinching and decisive.
• You can't afford to do favors or look the other way; it's your professional reputation and our profession at stake.