Entrepreneurial Strategies Presentation Transcript
Entrepreneurship and Strategy – Strategy is defined as the patterns of decisions that shape the venture internal resource configuration and deployment and guide alignment with environment.
It’s a plan of action for accomplishing goals.
Strategies provide the “how’s” of goal achievement
3.Steps Involved in Effective Business Strategy
Strategy Formulation – Planning and Analysis Phase
Strategy Implementation- Execution and Evaluation Phase
Strategy Review and Feedback – To find out variations and take corrective steps
4.Strategy - Levels
Strategy exists at Different Levels – Enterprise level strategy is concerned with the relationship between FIRM and Society
Corporate Strategy -focuses on Diversification and Portfolio Management
Functional and Sub-functional Strategies involve Marketing , Finance and Accounting and Human Resource Policies
5.ENTRY WEDGES – are not full blown strategies but, rather , methods of initial entry in a Business .
Major Techniques - Creation of New Product or Service that is rare and hard to imitate. Helps in Achieving Permanent Leadership. Parallel Competition – Attempt to fill a Market Niche with a small innovation or variation on an already accepted product or service
Creative imitation is the imitation of a competition along with adding a New Variation
6.Strategy Formulation – Undertake SWOT Analysis
Strengths – identifying existing organisational strengths
Weaknesses – identifying existing organisational weaknesses
Opportunities – Identify existing and emerging market opportunities
Threats – Identify threats to the future success of the business
Political: local, national and international political developments – how will they affect the business ?
Economic: what are the main economic issues – both nationally and internationally – that would have a bearing on the business.
Social: Identify existing and emerging social trends that would have impact on the business and their implications for future planning
Technological: Technological changes and their implications to competitive advantage.
8.Michael Porter – Five Forces Model
Strength of Barriers to Entry - how easy is it for new rivals to enter the industry?
Extent of rivalry between firms – Intensity of competition in the existing market?
Supplier power – the greater the power, the less control the organisation has on the supply of its inputs.
Buyer power – Power that customers in the industry hold
Threat from substitutes – Threat posed by alternative products and services in the market
9.Different Type of Straggles
Acquisitions – mergers and takeovers
New product development
10.Isolating Mechanism and First Mover Advantage
Isolating mechanisms are the methods entrepreneurs employ to prevent the rents generated from the new venture from leaking out
Types of Isolating Mechanisms – Property Rights including PATENTS, TRADE MARKS, COPYRIGHTS, GEOGRAPHICAL INTELLECTUAL PROPERY RIGHTS
11.Sources of First Mover Advantages
Technological Leadership through Patents
Strong R&D base
Building Cost Advantage,
Economies of Scale
Control over valuable and scarce resources
Marketing and Contractual Obligations
Build on Management Capability and Capacity
Use available competency and expertise to develop closely related products
Create Value through Synergy Effect
Focus on Quality as a Strategy
Differentiating the product
Differentiating on the basis of services offered
Differentiating by personnel
Differentiating by image
Differentiating by Markets