2012 Pearson Education, Inc, Publishing as Prentice Hall
Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 1 Publishing as Prentice Hall Copyright 2012 Pearson Education, Inc. 2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 2 Publishing as Prentice Hall The Context of Entrepreneurship Entrepreneurship - the process of starting new businesses, generally in response to opportunities. Entrepreneurial ventures - organizations that pursue opportunities, are characterized by innovative practices, and have growth and profitability as their main goals.
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 3 Publishing as Prentice Hall The Context of Entrepreneurship (cont.)
Small business - an organization that is
independently owned, operated, and financed; has fewer than 100 employees; doesnt necessarily engage in any new or innovative practices; and has relatively little impact on its industry.
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 4 Publishing as Prentice Hall Why Is Entrepreneurship Important?
Innovation Engage in the creative destruction process Act as agents of change Number of New Startups Increasing numbers of new firms Job Creation New ventures create 60-80% of net new jobs
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 5 Publishing as Prentice Hall Exhibit A-1: Evaluating Potential Ideas
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 6 Publishing as Prentice Hall Start-Up and Planning Issues Feasibility study - an analysis of the various aspects of a proposed entrepreneurial venture designed to determine its feasibility. Venture capitalists - External equity financing provided by professionally managed pools of investor money.
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 7 Publishing as Prentice Hall Appendix A-2: Feasibility Study
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 8 Publishing as Prentice Hall Appendix A-2: Feasibility Study (cont.)
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 9 Publishing as Prentice Hall Appendix A-2: Feasibility Study (cont.)
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 10 Publishing as Prentice Hall Venture FeasibilityFinancing Venture capitalists - external equity financing provided by professionally managed pools of investor money. Angel investors - a private investor (or group of private investors) who offers financial backing to an entrepreneurial venture in return for equity in the venture. Initial Public Offering (IPO) - the first public registration and sale of a companys stock. Copyright 2012 Pearson Education, Inc. 2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 11 Publishing as Prentice Hall Appendix A-3: Possible Financing Options
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 12 Publishing as Prentice Hall Developing a Business Plan Business plan - a written document that summarizes a business opportunity and defines and articulates how the identified opportunity is to be seized and exploited.
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 13 Publishing as Prentice Hall Elements of a Business Plan Executive summary Analysis of opportunity Analysis of context Description of the business Financial data and projections Supporting documentation
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 14 Publishing as Prentice Hall Legal Forms of Organization Sole proprietorship - a form of legal organization in which the owner maintains sole and complete control over the business and is personally liable for business debts. General partnership - a form of legal organization in which two or more business owners share the management and risk of the business.
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 15 Publishing as Prentice Hall Legal Forms of Organization (cont.) Limited Liability Partnership (LLP) - a form of legal organization consisting of general partner(s) and limited liability partner(s). Corporation - a legal business entity that is separate from its owners and managers. Closely held corporation - a corporation owned by a limited number of people who do not trade the stock publicly.
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 16 Publishing as Prentice Hall Legal Forms of Organization (cont.) S corporation - a specialized type of corporation that has the regular characteristics of a C corporation but is unique in that the owners are taxed as a partnership as long as certain criteria are met. Limited Liability Company (LLC) - A form of legal organization thats a hybrid between a partnership and a corporation.
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 17 Publishing as Prentice Hall Legal Forms of Organization (cont.) Operating agreement - the document that outlines the provisions governing the way an LLC will conduct business.
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 18 Publishing as Prentice Hall Exhibit A-4: Legal Forms of Business Organization
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 19 Publishing as Prentice Hall Exhibit A-4: Legal Forms of Business Organization (cont.)
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 20 Publishing as Prentice Hall Exhibit A-4: Legal Forms of Business Organization (cont.)
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 21 Publishing as Prentice Hall Exhibit A-5: Achieving a Supportive, Growth Oriented Culture
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 22 Publishing as Prentice Hall Human Resource Management Issues in Entrepreneurial Ventures Employee Recruitment Concerns Locating high potential employees who: can perform multiple roles are willing to buy-in (commitment) Filling critical skill gaps Employee Retention Issues Potential for damage to client/customer relationships due to loss of employees Need to offer desirable benefits Compensation: base pay and incentives
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 23 Publishing as Prentice Hall Leading Issues Personality Characteristics of Entrepreneurs High level of motivation, abundance of self-confidence, ability to be involved for the long term, high energy level, persistent problem solver, high degree of initiative, ability to set goals, and moderate risk-taker Proactive personality a personality trait that describes individuals who are more prone to take actions to influence their environments.
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 24 Publishing as Prentice Hall Leading Issues (cont.) Motivating Employees Through Empowerment Empowerment Giving employees the power to make decisions and take actions on their own to solve problems Benefits of Empowerment Improved flexibility and speed Stronger work motivation Higher morale Better work quality Higher job satisfaction Lower turnover Higher productivity Improved quality
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 25 Publishing as Prentice Hall Leading Issues (cont.) Empowering Employees Participative decision making Delegation Redesigning jobs
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 26 Publishing as Prentice Hall The Entrepreneur as Leader Leading Employee Work Teams Empowered teams Have the authority to plan and implement process improvements Self-directed teams Are nearly autonomous and responsible for many managerial activities Cross-functional teams Are composed of individuals from various specialties who work together on various tasks
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 27 Publishing as Prentice Hall Controlling Issues (cont.) Managing Growth Managing Downturns Planning for growth Recognizing crisis situations Organizing for growth avoiding the boiled frog phenomenon Financing growth Dealing with downturns, Finding people declines, and crises Creating a growth-oriented culture Controlling for growth
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 28 Publishing as Prentice Hall Recognizing Crisis Situations Boiled frog phenomenon - a perspective on recognizing performance declines that suggests watching out for subtly declining situations.
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 29 Publishing as Prentice Hall Exiting the Venture Why Leave? Desiring to harvest the value of the venture Facing serious organizational performance problems Desiring to pursue other interests/opportunities Business Valuation Methods Asset valuations Earnings valuations Cash flow valuations Copyright 2012 Pearson Education, Inc. 2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 30 Publishing as Prentice Hall Exiting the Venture (cont.) Harvesting - exiting a venture when an entrepreneur hopes to capitalize financially on the investment in the venture.
Copyright 2012 Pearson Education, Inc.
2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 31 Publishing as Prentice Hall Terms to Know Entrepreneurship Limited liability partnership Entrepreneurial ventures (LLP) Small business Corporation Closely held corporation Feasibility study S corporation Venture capitalists Limited liability company (LLC) Angel investors Operating agreement Initial public offering (IPO) Proactive personality Business plan boiled frog phenomenon Sole proprietorship Harvesting General partnership
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2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 32 Publishing as Prentice Hall Copyright 2012 Pearson Education, Inc. 2012 Pearson Education, Inc, Publishing as Prentice Hall Management, Eleventh Edition by Stephen P. Robbins & Mary Coulter Appendix - 33 Publishing as Prentice Hall