Lecture Strategic management - Chapter 12: Effective strategic leadership: Fostering corporate entrepreneurship and new venture creation

Chapter Twelve Effective Strategic Management: Fostering Corporate Entrepreneurship and New Venture Creation TRANSPARENCY­99 Learning Objectives After studying this chapter, you should have a good understanding of: • The importance of opportunity recognition in the venture development process • How strategic concepts contribute to the competitive advantages of new ventures and small businesses • The role of product champions and autonomous strategic behaviors in internal corporate venturing • How corporations develop an internal environment that promotes entrepreneurial development • How an entrepreneurial orientation can enhance a firm’s efforts to develop promising new venture initiatives • The pitfalls associated with new venture strategies and corporate entrepreneurship STRATEGIC MANAGEMENT CHAPTER 12 McGraw­Hill/Irwin Gregory G. Dess and G. T. Lumpkin Copyright © 2003 by The McGraw­Hill Companies, Inc. All rights reserved. TRANSPARENCY­100 Exhibit 12.1 Techniques to Stimulate Creativity Company Dupont Airco Industrial Gases DoubleClick Ford Motor Co. Creative Technique Teaches creativity at its in­housing training center. Classes include how to brainstorm and avoid creativity inhibitors. To create fresh perspectives, a mix of employees – high tech and low tech, management and staff– meet together to create new product proposals. Teaches the nominal group procedure (NGP) through its total quality management program. The technique allows participants to prepare secret lists of problems and potential solutions. Because the NGP provides anonymity, sensitive issues are brought into the open without fear of personal reprisals. Actively encourages fun at work. Its New York City office includes a miniature version of Central Park, complete with picnic tables and trees, and a rooftop basketball court where employees and their bosses compete. Its prize for the employee who brings in the most referrals each year? A motorcycle. Developed its own method for examining processes and identifying improvement ideas: RAPID, which stands for Rapid Actions for Process Improvement Deployment. RAPID workshops are used to generate ideas, recommend creative solutions, and develop action plans for implementing improvements. Sources: Gundry, L.K., Kickul, J.R., & Prather, C.W. 1994. Building the creative organization. Organization Dynamics: 22­37; Mackie, K. 1998. Ford RAPIDS helping UT departments streamline work processes. On Campus, April 14. Yaqub, R.M. 2000. The play’s the thing. Worth, November: 116­123. STRATEGIC MANAGEMENT CHAPTER 12 McGraw­Hill/Irwin Gregory G. Dess and G. T. Lumpkin Copyright © 2003 by The McGraw­Hill Companies, Inc. All rights reserved. TRANSPARENCY­101 Exhibit 12.2 All Small Companies*, By Industry Agricultural Services (2%) 115,000 Retail Trade (20%) 1,094,000 Services (40%) 2,215,000 Wholesale Trade (7.4%) 410,000 Source: SBA’s Office of Advocacy, based on Data Provided by the U.S. Census Bureau, statistics of U.S. Businesses. (Percentages don’t add to 100% because of rounding.) Transportation, Communications, and Public Utilities (4%) 217,000 Construction (12%) 662,000 Mining (0.4%) Finance, Insurance, and Real Estate (8%) 457,000 Manufacturing (6.%) * Businesses with 500 or fewer employees in 1997 (rounded) STRATEGIC MANAGEMENT CHAPTER 12 McGraw­Hill/Irwin Gregory G. Dess and G. T. Lumpkin Copyright © 2003 by The McGraw­Hill Companies, Inc. All rights reserved. TRANSPARENCY­102 Exhibit 12.3 Alternatives to Traditional Financing METHOD Leasing Barter Credit Cards Supplier Financing DESCRIPTION Allows a start­up to hold on to its cash and minimize commitments to equipment or real estate that might need updating as the company grows (or shrinks). Leasing costs are deductible as a business expense. A traditional non­cash means of exchanging products or services. Bartering has enjoyed a resurgence in popularity because exchange services that are now available on the Internet are facilitating more barter transactions. One of the fastest­growing techniques for financing start­ups; number one among women entrepreneurs. It’s like a bank loan without the lengthy approval process. But the high interest rates that some cards charge could make it risky. Suppliers that let you pay for goods or services in 60 or 90 days rather than after only 10 to 30 days are, in effect, financing your purchase. Some suppliers will agree to this because they need Source: Fraser, J. A. 1998. A hitchhiker’s guide to capital resources. Inc. Magazine, February: 74­ 82; Owens, T. 1990. Getting financing in 1990. Small Business Reports, June: your business as badly as you need their credit. Factoring Factoring is a method of raising cash by selling accounts receivables to a third party or financing against the value of receivables. It’s generally only used for short term cash needs and often comes with a hefty interest charge. STRATEGIC MANAGEMENT CHAPTER 12 McGraw­Hill/Irwin Gregory G. Dess and G. T. Lumpkin Copyright © 2003 by The McGraw­Hill Companies, Inc. All rights reserved. ... - tailieumienphi.vn