2 Outline Definition of entrepreneurs and entrepreneurship Factors considered when preparing to be self employedGeneration and sources of business ideasChoosing a product and a marketQualities of a good business opportunityBusiness plan developmentFactors that determine enterprise success
3 IntroductionEntrepreneur: is one who is willing to bear the risk of a new venture if there is a significant chance for profitPeter Drucker ( ) took this idea further, describing the entrepreneur as someone who actually searches for change, responds to it, and exploits change as an opportunity.Entrepreneurship is the process of starting a business or other organization.
4 Entrepreneurial Characteristics CreativityInvolves continuous learning, questioning and thinkingDedicationPlanning must be joined by hard work to succeedDeterminationIncludes persistence and the ability to bounce back after rough times (Success is the motivator; money is a reward)FlexibilityAbility to move quickly in response to changing market needsLeadershipAbility to create rules, set goals and capacity to follow them to fruitionPassionWhat gets somebody started and keeps them there!Self ConfidenceComes from thorough planning, expertise and gives entrepreneur ability to listen without being swayed
5 Generation and sources of business ideas Invite everyone in the quest for new ideas.Friends, family, colleagues e.t.cInvolve customers in the process of generating ideasThe traditional focus group needs more focus. Form advisory boards of key customers to serve as sounding boards for ideas. Identify customers who tend to buy the latest versions of your products. These “lead adopters” can provide you with insights about where the market may be headed and how your organization can best position itself.Involve customers in new ways Look outside your own field or industry for ideas on how to get customer input
6 Generation and sources of business ideas Focus on the needs that customers don’t expressLearn from customers by observing what they are not doing, listening to what they are not saying. Recognize the sources of their frustration and find potential ways of eliminating itSeek ideas from new customer groupsLook at your customers’ customers and your competitors’ customers and ask how do I meet their needs?Involve suppliers in product innovationthink of your organization as your supplier’s customer. You, too, have unarticulated needs. Try articulating them and get your supplier’s idea-generating capacity working in concert with yours.Benchmark idea-creation methods.Innovation-adept firms invest in ideation sessions, read books, attend seminars, and constantly seek to improve their skills
7 Why become and entrepreneur idiosyncratic entrepreneurship; those choosing self- employment regardless of opportunity and fit with professional background for ‘other reasons’;market-facing opportunity entrepreneurship; those choosing self-employment because of perceived external opportunity, but contrary to prior professional background;professional entrepreneurship; those choosing self- employment to join professional partnerships and establish a professional practice;family entrepreneurship; those choosing self-employment to join family businesses, some of which may be professional in nature;
8 Why become and entrepreneur independence-seeking entrepreneurship; those actively attracted to self-employment by a desire for independence, not associated with economic necessity;Lifestyle entrepreneurs; those, particularly women and younger people, who choose self-employment because it offers improved ability to balance work and family commitments, but not associated with economic necessity;reward-seeking entrepreneurship; those younger people voluntarily leaving paid employment to pursue actively financial reward and improved working conditions.
9 Choosing a product and a product An existing good or service for an existing marketDifficult approach for a start up operation due to high costs and uncertain profitsA new good or service for a new marketRiskiest strategy for a new firm coz product and market unknownA new good or service for an existing marketExpanded to include modified goods/servicesAn existing good or service for a new marketModerate risk which can be reduced through market research
10 Entry strategies for new ventures DifferentiationAn attempt to separate the new company’s product or service from that of its competitors e.g. through improved operations, features, portability e.t.cNice specificationAn attempt to provide a product or service that fulfills the needs of specific subset customersInnovationPioneering or radical innovation embodies a technological breakthrough or new-to-the-world product. Incremental innovations are modifications on existing products
11 Qualities of a good business opportunity DemandThere must be significant demand for a product or service or a gap in the existingReturn on investmentPotential of a venture to bear fruit in a set of time and which cover the capitalAvailability of ResourcesSufficient resources to take business opportunity before competitorsSkillsYou need the right skill to tap into a business opportunityScalabilityAbility to grow gradually over time and adapt to changing environmentsHealth profit marginDoes the business has substantial profit margin to guarantee sustainability while meeting the market gapCustomer retentionKeeping customers buying from you as long as possible
12 Enterprise success factors Get your service out of your head and down on paper. If you can’t quantify or document your service for repeatability and new employee training, you will kill yourself trying to grow the business.Start with a service you know and love.A successful services business, more than a product business, comes from a skill or insight that you have honed from experience. Now all you have to do is pass it to the many new members as you grow your team.Don’t let your service be viewed as a commodity.You need to highlight how your service is more innovative and of higher value to your target customers.
13 Be a visible and available expert in your domain. Be accessible on social media, write a blog or articles for industry publications, and participate in conference panels and speaking engagementsRecruit only the best people, with the right base skillsMake sure they bring solid base skills, so your training can focus on the innovative and unique elements that your service brings to the arena.Practice being a good communicator.Make sure everyone understands your vision and values both employees and customers The customer experience is more than the serviceMake sure that every interaction with every customer is positive
14 Business plan components Basic informationPeople involvedProduct or serviceMarketingProduction/delivery of your serviceLegal IssuesFinancial issuesOther information