1. Assembling the Team: Acquiring and Utilizing Essential Human Capital
Entrepreneurship 5
Assembling the Team: Acquiring and Utilizing Essential Human Capital

2. “Two are better than one;…if they fall, the one will lift up his fellow: but woe to him that is alone when he falleth, for he hath not another to help him up.”
--Hebrew Bible

3. Forming Founding Team Choose cofounders wisely
Secure help from outsiders
Develop strong working relationships

4. Human Resources Knowledge Skills Talents Abilities Social capital
Of co-founders and early employees are key to success

5. Success of Founding Team
Prior experience in industry
Prior experience as entrepreneur
Broad social networks
Broad range of knowledge and special skills
Communication
Social competence

6. Personal Characteristics of Founding Team Members
Conscientiousness
Agreeableness
Openness to experience
Extraversion
Emotional stability

7. Added Resources Board of Directors Key employees Advisers Investors
Consultants
Government programs

8. Is Bigger Better?
On balance, the benefits of increasing the number of employees outweigh the costs.
New ventures that start with more employees have a greater chance of surviving.
Profitability is positively related to size.

9. Temporary Employees Advantages Reduced fixed costs Flexibility
Secure specialized knowledge
Disadvantages
Lack commitment and motivation
Carry information to competitors

10. Temporary or Permanent?
Flexibility and speed of
acquiring new sets
of knowledge
Temporary
employees
Commitment and
retention
Permanent
employees

11. Founding Team Relationships
Three factors are crucial in developing strong working relationships among the team:
Clear initial assignment of roles
Careful attention to perceived fairness
Effective communication

12. Roles
The set of behaviors that individuals occupying specific positions within a group are expected to perform, and the authority or jurisdiction they will wield.
Divide responsibilities and authority according to expertise and knowledge.

13. Self-Serving Bias
The tendency to attribute successful outcomes largely to internal causes, but unsuccessful ones largely to external causes
Often leads people to conclude that they have not been treated fairly

14. Perceived Unfairness Feelings of Friction and Self-serving bias
conflict
Feelings of
perceived
unfairness

15. Effective Communication
Constructive
Is considerate
Doesn’t threaten
Is timely
Doesn’t blame
Is specific
Focuses on performance
Offers concrete suggestions for improvement
Destructive
Is harsh
Contains threats
Is not timely
Blames
Is not specific
Focuses on recipient
Offers no concrete ideas for improvement

16. Stress Management Emotional reactions Life events Cognitive appraisal
Physiological states

17. Stressors
Demands of job
Juggling roles
Responsible for others

18. Dangerous Effects of Stress
Physical illness
Lower productivity
Desk rage
Burnout

19. Stress Management
Physical tactics
Healthy diet
Exercise

20. Stress Management Behavioral tactics Reduce excessive worrying
Incompatible reaction procedure
Relaxation techniques
Step back from stressful situations