nerdy-notes.

com
uploaded by user TheTechnician Class: BUS 353 Lecture/Exam: Exam 1, Chapter 1-3 School: SBU Semester: Fall 2012 Professor: Feingold

Chapter I

Small business

Fewer than 100 employees Local business operations Finances supplied by one person or small group Small management team Potential to become more than one person show Contributions: 99.7% of all firms, 50% of employees in private sector, 60-80% of new job creation, 40% of all high tech employees and 97.& percent of all exports Relentlessly focus on an opportunity, new or existing, to create value while assuming risk and reward for both both his or her effort. Do more with less resources Not only start-up guys, but also NGOs and second generation businesses All active owner-managers are considered entrepreneurs An economically attractive opportunity to create value Resources: People, assets and capital to finance Doing more with less in terms of resources invested in a business and where possible controlling the resources without owning them. Get rich Make the world a better place Being your own boss Escape a bad situation Fulfillment

Entrepreneurs

Entrepr. opportunity

Bootstrapping

Entrepr. incentives

Opportunistic Entrepreneurs Person with both sophisticated managerial skills and tech knowledge (tech education, supplemented with business education) Plan for future growth, get multiple sourcing (small building contractor, who is very sophisticated in his management) Reluctant entrepreneur Entrepreneur due to severe hardship (Ex. Lady who burnt her feet as a child and couldnt wear high heals, so she created insole for high heals) Refugee Entrepreneur to escape an undesirable situation (Ex. Quitting job due to bureaucratic hassles)

Founder

Brings a new firm into existence pure entrepreneurs Artisans Person with tech skills, less business knowledge (mechanics, barbers) Enterprising individuals Often have marketing backgrounds and use ideas of others to launch new ventures Second stage entrepr. Taking over/ purchasing existing business Franchisee Entrepreneur whos power is limited by contractual relationship with franchising

organization Is owning a small business for you? A) Have to be passionate B)What is my tolerance for risk C) Am I an effective decision maker D) Am I willing to take on numerous responsibilities E) Will I burn out? Entrepreneurial team Two or more entrepreneur people that work on one thing Competitive Edge Special niche Customer focus Quality performance Integrity and responsibility Innovation and globalization Gazellas, small firm that has great prospect for growth. Small firm, provide substancial profits as in mils or 10mils Small firm, minimal profit (dry cleaners, barbershops etc) Lifestyle business: Owner have desired pattern of living. Not going to get professional financing 25-35 generation X, Generation Y 20-25

High potential ventures Attractive small firm Microbusiness

Age of Entrepreneurs

Characteristics of Entrepreneur:Determination, creativity, tolerance of risk, motivation, leadership, opportunity Mentors Person with experience who can give guidance in a specific field Teach entrepreneurs what to do and how Show them how to avoid mistakes More women than men start business Problem: Discrimination, balance work and family

Women Entrepreneurs

Chapter II Integrity To do what is right at all times Essential element of successful business relationships Does not blame others for mistakes, never goes back on a deal, bla bla Legal and ethical, questions of right and wrong Conflicts of self-interest

Ethical issues

Stakeholder Group Underlying values

Owners, customers, employees, community, government Inherent ethical beliefs of a firm that they operate on. They talk the talk, but they also walk the walk. Actions speak louder than words Environment Protection, consumerism, support of education, obligation to stake holders, support of education, compliance, response to community, contribution to community Improved financial, increased sales, better recruitment, improved access to capital, fewer inspections and less paperwork, improved productivity and quality, enhanced brand image and reputation

Social responsibility

Benefits

International business and integrity 1) Human rights and abuse of workers 2) Ethical imperialism, belief that the ethical standards of ones own country are superior and can be applied universally 3) Ethical relativism, belief that ethical standards are subject to local interpretation When in Rome, do as Romans do Building a business with integrity 1) Requires: Strong commitment to ethical conduct 2) Ethical leadership 3) Code of ethics, official standard for every employee formulated by business owner Principles for ethical policy making Purpose, pride, patience, persistence, perspective Better Business Bureaus do the following: Helping consumers make better informed decisions Creating incentive for business to adhere to proper business practices Resolving disputes via mediation or arbitration Chapter III Opportunity recognition identification of new products or services that might lead to new businesses act on existing but unnoticed business opportunities

Entrepreneurial alertness Startup TYPEA TYPEB TYPEC Startup Ideas

New venture or business started from scratch (new market) Idea centered around providing product or service not in existence in their market, but available somewhere else (new tech) Idea with new technology, centered around concept providing customers with new product. High risk, high growth potential (new benefit) Providing customers with an improved product Most likely to least likely - Prior work experience, personal interest, chance happening, suggestion, education/family business, friends.

Trends in general environment Political, sociocultural, demographic, economic, global, technological. Industry environment affects it directly