1. CHAPTER 13 Strategic Issues in Entrepreneurial Ventures and Small Businesses
STRATEGIC MANAGEMENT & BUSINESS POLICY 10TH EDITION
THOMAS L. WHEELEN J. DAVID HUNGER
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2. 99% of all businesses – 23 million small businesses
Entrepreneurial Ventures & Small Businesses
99% of all businesses –
23 million small businesses
60% -80% new jobs annually
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3. Entrepreneurial Ventures & Small Businesses
Employs fewer than 500 people and sales of less than $20 million annually –
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4. Small business firm – Independently owned & operated
Entrepreneurial Ventures & Small Businesses
Small business firm –
Independently owned & operated
Not dominant in field
Not engaged in innovative practices
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5. Entrepreneurial venture –
Entrepreneurial Ventures & Small Businesses
Entrepreneurial venture –
Primary goals profitability and growth
Characterized by innovative strategic practices
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6. Differences – Not in types of goods and services
Entrepreneurial Ventures & Small Businesses
Differences –
Not in types of goods and services
Fundamental views on growth and innovation
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7. Entrepreneur – Ultimate strategist All 3 levels Corporate Business
Entrepreneurial Ventures & Small Businesses
Entrepreneur –
Ultimate strategist
All 3 levels
Corporate
Business
functional
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8. Lack of strategic planning in small business –
Entrepreneurial Ventures & Small Businesses
Lack of strategic planning in small business –
Not enough time
Unfamiliar with strategic planning
Lack of skills
Lack of trust and openness
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9. Entrepreneurial Ventures & Small Businesses
Degree of formality –
Process far more informal in small companies than in large corporations
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10. Informal questions to begin strategic management process
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11. Strategic decision-making process for entrepreneurial ventures –
Entrepreneurial Ventures & Small Businesses
Strategic decision-making process for entrepreneurial ventures –
Develop basis business idea
Product/service with target market/customers
Scan external environment
Locate factors of opportunity/threat
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12. Strategic decision-making process for entrepreneurial ventures –
Entrepreneurial Ventures & Small Businesses
Strategic decision-making process for entrepreneurial ventures –
Scan internal factors
Relevant to the new business
Analyze strategic factors
Current situation using SWOT
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13. Strategic decision-making process for entrepreneurial ventures –
Entrepreneurial Ventures & Small Businesses
Strategic decision-making process for entrepreneurial ventures –
Decide go or no go
Opportunity to go
Generate business plan
Transform idea into reality
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14. Entrepreneurial Ventures & Small Businesses
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15. Entrepreneurial Ventures & Small Businesses
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16. Entrepreneurial Ventures & Small Businesses
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17. Advisory Boards – External business people – voluntary
Entrepreneurial Ventures & Small Businesses
Advisory Boards –
External business people – voluntary
Discuss strategic and other issues
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18. Sarbanes-Oxley Compliance costs
Entrepreneurial Ventures & Small Businesses
Sarbanes-Oxley
Compliance costs
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19. Sources of Innovation –
Entrepreneurial Ventures & Small Businesses
Sources of Innovation –
The unexpected
The incongruity
Innovation based on process need
Changes in industry or market structure
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20. Sources of Innovation –
Entrepreneurial Ventures & Small Businesses
Sources of Innovation –
Demographics
Changes in perception, mood, meaning
New knowledge
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21. Factors affecting new venture success –
Entrepreneurial Ventures & Small Businesses
Factors affecting new venture success –
Structure of industry
Business strategy of new venture
Behavioral characteristics of entrepreneur
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22. Entrepreneurial Characteristics –
Entrepreneurial Ventures & Small Businesses
Entrepreneurial Characteristics –
Identify opportunities better
Sense of urgency—action oriented
Detailed knowledge-physical stamina
Access to outside help
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23. Sub-stages of small business development
Entrepreneurial Ventures & Small Businesses
Sub-stages of small business development
Existence
Survival
Success
Take-off
Resource maturity
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24. Evaluation and Control –
Entrepreneurial Ventures & Small Businesses
Evaluation and Control –
Line between debt and equity blurred
Lifestyle part of financial statements
Standard financial formulas don’t apply
Personal preference
Banks combine personal and business wealth
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