Strategies for Growth and Managing the Implications of Growth Chapter 14

Growth Strategies Penetration Product Development Market Development Existing New Existing MARKET New Penetration Product Development Market Development New Geographic Market New Demographic Market New Product Use Diversification Backward Integration Forward Integration Horizontal Integration

Growth Why important? Advantages Problems Pressure on existing financial resources Pressure on human resources Pressure on Management of employees Pressure on entrepreneur’s time

Overcoming Financial Pressures Three Methods Financial control Managing inventory Keep good records

Overcoming Financial Pressures Watch the Financial Statements Look at expected v. actual Sensitivity analysis

Overcoming Financial Pressures Managing Inventory FIFO v. LIFO Why use LIFO? Managing Fixed Assets Why lease? Managing Costs and Profits What caused increases and decreases? Percentages

Overcoming Financial Pressures Taxes Withholding Federal State Social Security Medicare Record-Keeping Software Importance

Overcoming Pressures on Existing Human Resources Initial Company HR Permanent v. Part-time Employees Which is better? Firing Processes Culture Affected by human resources

Overcoming Pressures on Management of Employees Participative Management Style Advantages Establish a Team Spirit Communicate with Employees Provide Feedback Delegate Responsibility Provide Continuous Training

Time Management Why study it? Increased productivity Increased job satisfaction Improved interpersonal relationships Reduced time anxiety and tension Better health

Principles of Time Management Principle of Desire Recognize the problem and need to change Principle of Effectiveness Focus on important items Principle of Analysis Look at where time is allotted inefficiently

Principles of Time Management Principle of Teamwork Only small amount is under your control Principle of Prioritized Planning Categorize by level of importance Principle of Reanalysis Review one’s time management process

Entrepreneurs and Firm Growth ENTREPRENEUR’S GROWTH ASPIRATIONS No Yes High ABILITY Low Unused Potential Actual Growth Little Potential Constrained