Fall 2011 Week 4 Lecture 2 Morris Women and Minorities

Fall 2011 Week 4 Lecture 2 Morris Women and Minorities -...

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Unformatted text preview: Michael H. Morris, Ph.D. N . Malone Mitchell Chair in Entrepreneurship Head, School of Entrepreneurship Oklahoma State University The process of creating value by putting together a unique combination of resources to exploit an opportunity. Process Value Unique approach Opportunity So our focus is not on motivation to start a business, self-efficacy, skills, acquiring resources, and so forth… …but on the recognition of opportunity in the first place 1 8/20/2011 Identify an opportunity Develop a business concept Assess the needed resources Acquire the necessary resources Implement Manage and harvest the venture Favorable set of circumstances creating a need or opening for a new business concept A situation where something can be improved at a profit The existence of “pain” that can be removed ---something is unsatisfactory But you can have opportunity without something being wrong Opportunity: -labor shortage in fast food industry (unskilled services in general) -high employee turnover in fast food restaurants -lousy/inconsistent service Business Concept: -hire and train high school students; act as outsourced labor supply to local Burger King franchisees 2 8/20/2011 1. 2. 3. A customer need Enough customers with the willingness and ability to buy A competitive opening The opportunity places limits on what you can achieve with a venture Attracting new users to the market Opportunity Increasing usage rates Taking customers from competitors Perennial (do something cheaper, quicker, higher Occasional (new capability, supply withdrawn, Multiple cause (more elderly with more income and Multiple effect (increased longevity creates need quality, more reliably, incrementally better) demand surge, new market segment, market holes) more time on their hands = ?????) for…, domestic terrorism creates need for…, shorter school day creates need for…) 3 8/20/2011 deliberate or active search, or a „discovery‟ process as one pursues everyday life or a business idea (iterative) Challenge existing assumptions Look for patterns of trends (in markets, demographics, social behaviors, customer buying behavior, competitive practices, etc.) Monitor changes in rules, laws, regulations Conduct „needs‟ research, focus on problems Look for under-utilized resources Rule changes Demographic change Underserved markets Poorly served markets Social trends New customers to a market Increasing usage rates Shortages Applications of new knowledge/technologies to address unmet needs or change ways needs are met 4 8/20/2011 Cocooning Anchoring Icon Toppling Save our Society 99 Lives Vigilante Consumer No market need (better mousetrap) Customers not dissatisfied Customer loyalty very strong Customer “switching costs” Customers hard to reach Intense competition Easy for people to enter after you Customers too demanding relative to what they‟ll pay Window not open Optimal time span during which to enter a market with a particular new business concept You can get in too early You can get in too late Innovation diffusion curve and the mean adoption time influence how long the window is open Influenced by degree to which concept offers unique advantage, customer learning requirements and switching costs, strength of established loyalties, consistency of concept with customer values and beliefs, etc. 5 8/20/2011 Pursuit of opportunity begets opportunity awareness Where you start is just a start---a journey unfolds But where you start can delimit what new opportunities are encountered e.g., moving up or down the value chain from where you start Are there things about the female experience, the African American experience, the Native American experience, or the Hispanic experience that affect how opportunity is perceived? ◦ ◦ ◦ ◦ ◦ ◦ ◦ Socialization-is babysitting a venture? Gender roles –importance of family, less aggressive behavior Values Sexism Stereotypes Discrimination Conditioning from environment What sort of venture ideas to do they? Why do so many focus on campus things or student things? What‟s the conclusion? What could change this? 6 8/20/2011 All sorts But too many have five strikes against them: • • • • • Low capital requirements Low entry barriers Intense competition Little differentiation Must compete on a price basis Attracting new users to a market Increasing usage rates Opportunity Taking customers from competitors If you focus on customers just like yourself (e.g., your ethnic group) or your immediate surroundings, evidence suggests it can severely limit your growth It can only support so many businesses, and has limited buying power Breadth Technologies Markets A ggregate G eneral N arrow/Niche/Local B to C H ybrid Combinations S pecialized A pplications N ational/Global B t o B or B to C Industries Depth 7 8/20/2011 How broad or narrow? How deep or shallow? Embeddedness of opportunities within a context that is beyond the awareness or understanding or perceptual grasp of a given ethnic group Constrained by one‟s distance from the institutionalized mechanisms of service delivery (e.g., financing, marketing vehicles, networks, distribution channels, technology, etc.) What do rich people need, what do businesses need, what does local government need? early work experience (e.g., how early, how stretching) education (e.g., dropped out, not engaged, stereotyping) travel (e.g., never left my neighborhood or hometown) role models (e.g., rap singers, athletes, gang leaders) hobbies (e.g., never left my neighborhood or hometown) life experience (e.g., how reinforcing of conventional roles) 8 8/20/2011 Is opportunity recognition influenced by my motive for getting into business Pushed by lack of a job, need for income Pulled by opportunity Market conditions Demand conditions Segments Competitive conditions Costs Resources available Technologies Regulations 9 ...
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