1. FRANCO FLORENZI Resources & Capabilities

2. Learning Objectives ◦ Develop a strategy for accessing the key resources and capabilities needed to launch the business idea. ◦ Understand the different techniques required for identifying and accessing the key resources and capabilities required to launch or run a small business.

3. Resources And Capabilities: Looking Inward ◦ An internal analysis of your start-up ◦ Paired with an analysis of the external environment (and market research), gives a holistic picture of your situation and potential. ◦ Enables an entrepreneur to asses what the start-up has and what it can do with what it has. It can be thought of as a realistic look at the strengths and weaknesses. ◦ Using this analysis, it is possible to determine how to fill any gaps in resources and capabilities.

4. Resources: What Do You Have? ◦ Functional/Capital Resources ◦ Operating resources ◦ Financial resources ◦ Promotional resources ◦ Human Resources ◦ Expertise ◦ Experience ◦ Market knowledge ◦ Employees ◦ Managers ◦ Partners ◦ Reputation/Credibility ◦ Suppliers ◦ Accountants ◦ Lawyers ◦ Customers

5. Capabilities: What Can You Do Well? ◦ Adding value: ◦ Unique capabilities that competitors do not possess ◦ Capabilities valued by customers ◦ Difficult to imitate ◦ Running the business ◦ Management capabilities ◦ Marketing capabilities ◦ Customer-service capabilities ◦ Redundant Capabilities: ◦ As a start-up evolves, constant reevaluation of capabilities and their relevance to operations is necessary ◦ Without this, a start-up risks the capabilities turning into ‘rigidities’ that hinder the growth potential

6. The Value Network ◦ Links/relationships/networks that a start-up needs to create its product(s) or service(s) ◦ Linkages within this ‘Network’ can lead to competitive advantage. ◦ Looking both at your own value network and at the linkages that exist between those organizations in your network (what kind of relationship do your suppliers have with each other). This helps a start-up decide who to work with and how to work with them. ◦ Understanding your value network can help a start-up understand cost and pricing structures across the entire network. ◦ Can help a start-up decide whether to do activities ‘in-house’ or outsource

7. Dealing With Operational Resource Constraints ◦ Infrastructure and production: ◦ Accessing Resources - Asset Parsimony & Non-Ownership: ◦ Lease not own. ◦ Licensing (manufacturing and/or distribution) ◦ Full format franchising ◦ Outsourcing ◦ Purchasing Consortia ◦ E-Solutions ◦ The online storefront ◦ Interactive website ◦ E-payments ◦ Quick Response (QR) and augmented reality

8. Discussion Questions ◦ Think about resourcing a startup: ◦ What capabilities does an entrepreneur need? ◦ What can an entrepreneur do if he/she lacks these capabilities? ◦ What can an entrepreneur do if he/she lacks resources that are necessary? ◦ Human ◦ Functional ◦ Relational ◦ Think of the three ‘categories’ of resources mentioned above. How might a start-up’s needs in each of these areas change with time? ◦ Think of examples of well-known firms whose capabilities became redundant and turned into constraints.

9. Case Study: Franco Florenzi ◦ Online accessories company, particularly watches, bracelets, bags, and shoes. ◦ Established 2014 ◦ Does business in the West Midlands, Birmingham and Worcestershire ◦ Begun by a University of Worcester student

10. Case Study: Franco Florenzi ◦ In their own words (from their website): ◦ Franco Florenzi is a design-led brand, focused on creating unique and simple designs. ◦ All our products are designed in England and are manufactured from high quality materials, sourced from around the world. We make sure that what we offer is suitable for all occasions, combining this with an exquisite Italian culture, to provide you with a life of luxury at an arms length.99.3% of our customers would recommend us

11. Case Study: Franco Florenzi ◦ Pre-video discussion: ◦ What resources do you think will be most crucial to this company at this stage in its start-up? ◦ What challenges do you think a young entrepreneur would face in this type of industry when ‘breaking-in’? ◦ How would you predict that Franco Florenzi would have to reevaluate its resources and capabilities after its initial start-up stage?

12. Video ◦ Embed/show video

13. Case Study Discussion Questions ◦ Discuss the evolution of Franco Florenzi’s resourcing needs. ◦ How did Franco Florenzi’s founder deal with its capability constraints at the beginning? ◦ Think of your enterprise/start-up idea. Make a map of the capabilities you have and those which you would need to acquire to launch a successful start-up. Where will you turn for the ones you need? ◦ Think of your start-up a year down the road. How would your capability and resource needs change? ◦ How could a company deal with breaking into an industry without personal networks to suppliers/manufacturers?