Its Opportunities and Rewardsmcecenter.com/resources/Chap001.pdf · Learning Objectives LO1...
Transcript of Its Opportunities and Rewardsmcecenter.com/resources/Chap001.pdf · Learning Objectives LO1...
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Chapter 01
Small Business
Its Opportunities and Rewards
Copyright © 2011 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin
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Learning Objectives
LO1 Understand the scope of small business in the U.S.LO2 Learn the differences between small business and
high-growth venturesLO3 Discover the rewards entrepreneurs can achieve
through their businessesLO4 Be able to dispel key myths about small businessesLO5 Identify actions key to becoming a small business
ownerLO6 Understand how small businesses are important to
our economy and your community
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Starting an Entrepreneurial Small Business
Small Business– involves 1-50 people and has its owner
managing the business on a day-to-day basis
Entrepreneur– a person who owns or starts an
organization, such as a business
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Starting an Entrepreneurial Small Business
First hurdle is inactionSecond hurdle is taking the right
actions– What you need to do and how to do it
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Starting an Entrepreneurial Small Business
Small Business Administration– a part of U.S. government which provides
support and advocacy for small business
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Starting an Entrepreneurial Small Business
Small Business Development Center– offices co-sponsored by states and the
federal government that offer free or low-cost help to existing or potential small business
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Question
What is the facility which offers subsidized space and business advice to companies in their earliest stages of operation?
A.IncubatorB.Small Business Development CenterC.SBAD.Red Hat
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Starting an Entrepreneurial Small Business
Incubators– a facility which offers subsidized space
and business advice to companies in their earliest stages of operation
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Defining a Small Business
SBA defines a small business as one with fewer than 500 employees
SMEs – Small enterprise – 1-50 people– Medium enterprise – 51-500 people
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Small Business Owners and Entrepreneurs
Entrepreneur– anyone who owns a business– Self-employed, founder, heir, franchise
Owner-manager– individual who owns and runs a business
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Differences between Small Businesses and High-Growth Ventures
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Dynamic Capitalism Topology
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Figure 1.1
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Small Businesses vs. High-Growth Ventures
Innovativeness– refers to how important a role new ideas,
products, services, processes, or markets play in an organization
Potential for growth– refers to the potential market size
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Rewards for Starting a Small Business
Growth rewards – what people get from facing and beating
challenges
Income rewards – money made by owning one’s own
business
Flexibility rewards – ability of business owners to structure life in
the way that suits their needs1-14
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Rewards New Entrepreneurs Seek Through Small Business
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Figure 1.2
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Myths about Small Businesses
Not enough financingYou can’t start a business during a
recessionTo make profits, you need to make
somethingIf you fail, you can never try againStudents don’t have the skills to start a
business
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BRIE Model
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Small Business and the Economy
New JobsInnovationsNew opportunities
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Small Business and the Economy
Small business is the engine of job creation, generating 75% of the 3.4 million new jobs
Small businesses employ more than half of all Americans
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Small Business and the Economy
Creative Destruction– the way that newly created goods,
services, or firms can hurt existing competitors
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Global Entrepreneurship
Factor driven economies– Entrepreneurship is essential to helping
build personal wealth and breaking the cycle of low-wage jobs
– Entrepreneurship levels are high
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Global Entrepreneurship
Efficiency-driven economies – entrepreneurship becomes a key way to
build a middle class– Entrepreneurship levels are in the middle
range
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Global Entrepreneurship
Innovation-driven economies – focused on high-value-added
manufacturing, but marked by very large service sector
– Entrepreneurship levels are lowest
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Global Entrepreneurship
Virtual Instant Global Entrepreneurship (VIGE) – entrepreneurial approach using
ecommerce to handle global trade– Depends on using websites like eBay or
eLance to quickly establish a global presence
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Early Stage Entrepreneurial Activity for 43 Nations
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Beyond Small Business
Creation – focus which looks
at the making of new entities
Customer-focus– focus which refers
to being in tune with one’s market
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Beyond Small Business
Efficiency – focus which refers
to doing the most work with the fewest resources
Innovation– focus which looks
at a new thing or a new way of doing things
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Beyond Small Business
Independent entrepreneurship – form of entrepreneurship in which a
person or group own their own for-profit business
Public entrepreneurship – form of entrepreneurship that involves
revitalizing government agencies
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Beyond Small Business
Corporate entrepreneurship – form of entrepreneurship which takes
place in existing businesses around new products, services or markets
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Beyond Small Business
Social entrepreneurship – form of entrepreneurship involving the
creation of self-sustaining charitable and civic organizations, or for-profit organizations which invest significant profits in charitable activities
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Question
What is the degree of attention to which your target market pays to your idea or organization?
A.Mind-boxB.Viral shareC.Mindshare D.Brain share
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Beyond Small Business
Mindshare – degree of attention to which your target
market pays to your idea or organization
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