chap03 - Success in any enterprise requires the right...

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Unformatted text preview: Success in any enterprise requires the right product, methods, and workers, and each must complement the others. Joseph Burger Summary How do successful entrepreneurs create a compelling business design for their new ventures? To design a new business, the entrepreneur must cogently and clearly describe the customers and their needs and how the new venture will satisfy those needs. Chapter 3: Summary Technology Ventures: From Idea to Opportunity Example of a vision for an innovative firm We strive to preserve and improve life through the innovation of biomedical devices while supporting, training, and inspiring our employees so that individual ability and creativity is released and rewarded. Our goal is to be a leader in the industry by 2006 and be widely known throughout the world. Chapter 3: Table 3.1 Technology Ventures: From Idea to Opportunity Elements of a vision Clarity: Easily understood, focused. Consistency: Holds constant over a time period, but adjustable as conditions warrant Uniqueness: Special to this organization Purposeful: Provides reason for being Chapter 3: Table 3.1 Technology Ventures: From Idea to Opportunity A mission statement is a description of the course of action to implement the vision. Possible Elements of a mission statement • Core Values • Competitive Advantage • Customers and/or Stakeholders • Values Provided to Customer • Products • Markets or Industry Chapter 3: Table 3.3 Elements of a Mission Statement Technology Ventures: From Idea to Opportunity The Value Proposition defines the company to the customer. Chapter 3: Concept Technology Ventures: From Idea to Opportunity The Value Proposition defines the company to the customer. Five values offered to a customer 1. Product: Performance, quality, features, brand, selection, search, easy to use, safe 2. Price: Fair, visible, consistent, and reasonable 3. Access: Convenient, location, nearby, at­hand, easy to find, in a reasonable time 4. Service: Ordering, delivery, return, check­out 5. Experience: Emotional, respect, ambiance, fun, intimacy, relationships, community Chapter 3: Table 3.6 Technology Ventures: From Idea to Opportunity Example of a value proposition: Intel offers product as their primary value and service as their secondary value. The Unique Selling Proposition is a short version of firm’s value proposition. Example: Intel has a USP: The best product with great service. Chapter 3: concept Technology Ventures: From Idea to Opportunity Elements of A Business Model • Customer Selection Who is the customer? Is our offering relevant to this customer? • Value Proposition What are the unique benefits? • Differentiation and Control How do we protect our cash flow and relationships? Do we have a sustainable competitive advantage? • Scope of Product and Activities What is the scope of our product activities? • Organizational Design What is the organizational architecture of the firm? • Value Capture for Profit How does the firm capture some of the total value for profit? What activities do we do and which are outsourced? How does the firm protect this profitability? • Value for Talent Why will good people choose to work here? How will we leverage their talent? Chapter 3: Table 3.8 Technology Ventures: From Idea to Opportunity Dell Computer Business Model • Customer Selection: High Relevance • Value Proposition: Unique Benefits Four Segments: Corporate, Government, Education, Consumer. A customized computer at a good price with great service readily or the Internet. accessible via phone • Differentiation and control: Sustainable competitive advantage • Scope of Product and Activities • Organizational Design Customized products via a direct sales channel on the phone or Internet with strong customer relationships. • Desktop, laptop, and servers. Strong supply chain management. Divisional organization for each customer segment. Value Capture for Profit Opportunities for cross­sell and up­sell. Avoid price as the key value and focus on accessibility. • service and service and Value for Talent: Learn, Grow, Prosper Training, Learning, and Career Opportunities. Chapter 3: Table 3.9 Technology Ventures: From Idea to Opportunity Identify and State the Firm’s Core Competencies Example: The core competency of Google is the design and operation of an internet search engine. Chapter 3 Technology Ventures: From Idea to Opportunity Competitive Advantage: The competitive advantage of a firm is its distinctive factors that give it a superior or favorable position in relation to its competitors. A sustainable competitive advantage is a competitive advantage that can be maintained over a period of time – hopefully, measured in years. Chapter 3: concept Technology Ventures: From Idea to Opportunity The market value of a firm is: MV = CA x D CA = competitive advantage D = duration Chapter 3: Market Value Technology Ventures: From Idea to Opportunity Sources of Competitive Advantage Source Efficiency ­ Low Costs Product Innovation Quality ­ Reliability Customer Responsiveness Manufacturing Innovation Chapter 3: Table 3.11 Dell Toyota Example Alcoa Intel Mercedes Technology Ventures: From Idea to Opportunity Principle 3 The vision, mission, and value proposition, and business model embodied within the business design firm and powered by a sustainable competitive advantage can lead to compelling results. Chapter 3: Principle 3 Technology Ventures: From Idea to Opportunity VENTURE CHALLENGE 1) Create a brief vision statement for your venture. 2) State the value proposition for the venture. 3) Create a draft business model for the venture using the elements of Table 3.8. 4) What are your venture’s core competencies and competitive advantage? Chapter 3: Venture Challenge Technology Ventures: From Idea to Opportunity DVD Videos “Don’t Write a Mission Statement, Write a Mantra” Guy Kawasaki (Garage Technology Ventures) “Innovate in Technology and Business: The Founding of Google” Larry Page (Google) Chapter 3: DVD Videos Technology Ventures: From Idea to Opportunity ...
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