On some of the misconceptions of entrepreneurship
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On some of the misconceptions of entrepreneurship

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On Some of the Misconceptions of Entrepreneurship 11th International Entrepreneurship Forum, PWTC, Kuala Lumpur, 3-5th September 2012

On Some of the Misconceptions of Entrepreneurship 11th International Entrepreneurship Forum, PWTC, Kuala Lumpur, 3-5th September 2012

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    On some of the misconceptions of entrepreneurship On some of the misconceptions of entrepreneurship Presentation Transcript

    • 11th International Entrepreneurship Forum, PWTC, Kuala Lumpur, 3-5th September 2012 Murray Hunter University Malaysia Perlis
    • MostEntrepreneurs look like this
    • TOTAL ESTABLISHMENTS OF COMPANIES BY SIZE 4,542 LARGE (0.8%) 12,694 MEDIUM (2.3%) 100,561 SMALL (18.2%) 435,052 MICRO (78.7%)Census of Establishments & Enterprises 2005 DOS - TOTAL ESTABLISHMENTS: 552,849Dec 2010 3
    • DISTRIBUTION OF SMEs BY SECTOR Manufacturing Agriculture 39,376 34,225 (7.2%) (6.2%) Services 474,706 TOTAL SMEs : 548,307 Census of Establishments & Enterprises 2005 DOS - (86.6%) Dec 2010 4
    • CONTRIBUTION BY SMEs(%)60 8.15040 3.9 33.930 0.120 19.7 7.910 14.5 8.4 11 0 G DP E mployment T otal E x port contribution Manufacturing S ervices Ag riculture Preliminary Statistics by DOS - Dec 2010 5
    • Degree of ambiguity Active/Imaginative Allocative Construction Intuitive Analytical Supply/Demand changes New technologies Demographic changes New Business models Value creation n t io va no Locus of change In Inductive Imitation Discovery Deductive Replication & Extension Incongruities (Black & white) Structural changesPassive/Reactive ©Hunter (2012) The forms of opportunity
    • Low Intuitive High High Large Companies & Breakthrough Consumer Type Technology Markets High analytical and high High analytical & Low intuitive opportunities, high intuitive opportunities, strategy & high tactical Analytical high strategy & low tactical exploitation Growing exploitation importance Imitative Business Entrepreneurial of formal Low analytical & low intuitive Low analytical & high intuitive, strategy opportunities, low strategy & low strategy & high tactical low tactical exploitation exploitation Low Growing importance©Hunter (2012) of tactical moves
    • Imitative
    • Imitative
    • Imitative
    • Four potential firm opportunity seeking typologies Market Orientated Both Market & Firms Entrepreneurially High Orientated Firms High adaptability to the environment but low High adaptive and idea generative idea & strategy Market Orientation generative & strategy ability development ability Conservative firms Entrepreneurial Firms Low Very low adaptability to High generative idea environment & strategy capability Low High Entrepreneurial Orientation
    • Space Global National City NeighbourhoodSectional Interest Today Next Next Next Life Children’s Time W Week Year Few Years Time Lifetime
    • People start businesses for the wrong reasons and mistake something they like for an opportunity
    • Tissue Culture
    • Microwave Oven Pressure CookerChemicals & Spoons, etc. Glassware
    • Why let the train leave without you?
    • Mostpeople like to takethings easy
    • • Insufficient Sales•Insufficient Capital• No business plan• No managerial focus• Inadequate records• Lack of profit focus• Cash flow• Inadequate systems• Failure to plan for taxation• Inadequate resource management• Break even point • Failure to develop new products
    • Can and doentrepreneurs use a business plan?
    • We can land a man on the moon and return himsuccessfully to Earth but we are still not too sure what factors make a firm successful
    • Consumers Positioning Potential new novel Opportunity product extending market field or creating a new oneAttempting through existing or to create Targeting new channels and Refining thesome form business models. Idea ofcompetitive advantage Segmentation Concept Product idea to compete with Market existing products in market Identification The set of possible ideas/products/markets The Causation Process The Effectuation Process
    • Wind in the case of a yacht orenvironmental turbulence in the Vision & case of a firm. Goals Actual Path & Performance y ateg d Str ate Modified t icip An Vision & Goals
    • Evolved Strategy Trial and error tactical use with various levels ofX X X X Success/Non-Success Tactics Applied
    • Opportunity Shift Time Newly identified opportunity needing different goals, An identified strategies,opportunity in competencies, skills, the past resources and organization than previously The Opportunity Landscape What strategies are required to successfully Present Needed exploit the new Strategies Realignment of Strategies Strategies opportunity and meet the organizations new goals? Competitiveness What type of organization and Present Needed business model is Organization Realignment of Organization Organization needed to support the selected strategy? What skills, competencies and Present Skills & Needed Skills & technologies are Realignment of Skills & Competencies needed to support the Competencies Competencies new business model and strategy? What resources are needed to support Present Needed Realignment of Resources skills, competencies, Resources Resources technologies, new business model and strategy? What networks are Present Needed needed to exploit the Networks Realignment of Networks Networks opportunity, acquires skills, technologies and resources, support the new business model and strategy? What new goals are Present Goals New Goals Setting of New goals needed to exploit the newly identified opportunity? Reengineering of Total Organization
    • Young & invigorating image Internet Bookings An exciting lowYoung good looking cost airline to flyair & ground crewsModern and trendy on aircraft interiors Advertising image Limited use of Baggage travel agents Standardized aircraft toNo baggage transfers cut down on No connection with maintenance costsother airline baggage Fast Aircraft services turn-around times Baggage surcharge General savings on overheads Extra means of Auto-check with no revenue baggage Not burdened by Paid snacks & meals Seating traditional air and ground Low landing charges Blankets crew procedures and terminal fees Computerized ticketing No connection with other Headquarters located methods airlines at airport terminal Related businesses - hotels
    • The Wright Bros. developed the airplane through effectuation (trial & error). They developed a new theory and a new invention.
    • It was only when a use for the newinvention was found that an industry developed.
    • Could the Wright Brothers developed a business plan whenthey first decided to build a flying machine?
    • At the time this looked just as viable
    • The Secret
    • Forecasting
    • Things are always amystery untilwe get there
    • Rate of Adoption Innovation Growth Maturity100%80%60%40%20% 1975 1980 1985 1990 1995 2000 2005 2010
    • Market ResearchLess than 2% of filed patents are ever commercialisedDoes a new invention have consumer benefits or create anycompetitive advantage?Can consumers accept the new invention?
    • Product EvolutionPre 1900’s Laundry BlueUp to Late 1940’s Solid Soaps & Powders Laundry Detergent Bars1950’s until present Laundry Detergents Powders Laundry Detergents with Liquids Special Detergents Additives Concentrated1980’s until present Laundry Powders Laundry Detergent Tablets
    • Society & family, peers & Influence on other paradigmsrole models, assumptions,values, beliefs, learning,mentors, perceptions Peer groups mentors, society Cultural Paradigm Commitment and ethicsUpbringing and family Social & Educationalbackground, education and Backgroundlife experiences, stressfulunexpected events, fate Paradigm Chance & Fate Identify and exploitLooking for benefits, opportunitieseffective performance,able to secure resources,overall vision, able to Resource gatheringweigh things up in Paradigm Strategicstrategic way Customer orientatedEnvironment, peers, family,culture, realities, motivation, Sense of achievementdedication, self assurance,self perception, morality, Motivation &responsibility, determinationaccountability, adversity to Paradigm Personalityrisk taking (courage), standon beliefs, level of comfort Adversity to risk takingEnvironment, triggers, Seek & identifyinspiration, lateral & opportunitiesserial thinking,technical skills, ideas,opportunities, solution Innovative Paradigm CreativityfindingHealth, personal energy,focus, time orientation,orientation to getting things In control of thedone, orientation towards business Actiongetting the right things Paradigm Attributes of the Entrepreneurdone Able to inspireSelecting the right people,team/individual orientation, peopleview of outside expertise,networking, interpersonal Ability to workoutlooks, management style, with peopleleadership, Paradigmdominance/submissiveness Networking InterpersonalPositive & negative Experienceexperiences, success &failure, education &skills, soft skills, talents Technical skillsand abilities Skills Paradigm Soft skills Talents & abilities
    • The Potential Socio-psycho Factors that Influence Opportunity Discovery and Behavior. World and work experience, education, culture, family upbringing, etc. Personal Paradigms Skills Behavior Alertness Influencers Motivation The Psych Prior Knowledge Sense of self. ego, encoded Perception Strategic Outcomes assumptions, Outlook beliefs and values. Personality Feedback Creativity Expectations, goals, Traits self regulating Propensity restraints, etc. to Action Talents and Motivational Abilities Trigger Interpersonal Idea GAP “What I do” “How I feel” “Who I am” A Trigger External event or Situation internal feelings
    • People start businesses for the wrong reasons and mistake something they like for an opportunity
    • Size First entrepreneurial phase Possible mature entrepreneurial phase Usually NPD strategies Sales Regeneration Usually time of increasing Mid-life crisis organizational rigidity An era of complacency and Decline rigidity Enterprise begins to take a Profit ‘past orientation’ Pre start-up Start-up Growth Maturity Decline or rebirth Entrepreneurship is just a stage in the firm lifecycle
    • Change in how and where people buy the product Risk None Some Great None None Low MediumChangeIn User Some Low Medium High Habits Great Medium High Dangerous
    • Entrepreneurship Curriculum & Teaching Without Relevant Technology Knowledge & Training
    • The educationsystem is hung upabout measuring intelligence
    • Entrepreneurshiphas very little to dowith intelligence. It is all about creativity. Otherwise onewould have to be aprofessor to start a new business.
    • Unlikeintelligence creativity can be taught
    • New Ideas Unknown Opportunities Surrounding Developing Strategies The Metaphoric Environment Solving Problems Concept of Creative “Domain” &“Field” Intelligence Environmental Environmental Factors conducive Factors that to creativity hinder creativityInternal Influencing Perception Factors Motivational Focus & Attention Trigger Creative Sensitivity Patterning Energy Emotion Thinking Curiosity Processes Prior Empathy (Self Organizing Knowledge Patterned Thinking Confidence System) Processes Discipline Interest Passion Cognitive Thinking Tools & Styles Memory Heuristics Belief Imagination Applied Thinking Fantasy Tools, Domain & Field Experience Manifestations & Acceptance/ Tacit Knowledge Elaborations Rejection Creative Product Hunter (2012)
    • Creativity Tool Cognitive Skill Knowledge (vocabulary) of odorous substances Imagination Olfactory sensitivity Knowledge of potential strengths, weaknesses and applications of odorous materials Knowledge of Curiosity, enquiry outstanding and Perfumer fragrance creations experimentation Excellence within the domain Practical knowledge & experience Process & Interest and Product passion Time, patience, perseverance EmotionKnowledge Base
    • Understanding Complexity
    • Paticcasamuppāda When this is, that is(1) (Present) From the arising of this comes the(2) arising of that (Past to present) From the stopping(4) of this comes the stopping of that (Past to present)(3) When this isn’t, that isn’t (Present)
    • Location Climate Genetic Material Humidity Collection Temperature Purchase Sunshine hoursTopography UV radiation Plant physiology Seasons Slope & drainage Propagation Yield and Rainfall characteristics Chemical Constituents of the Humus Nutrients Method of extraction Essential Oil Extraction time Compactness Drainage & water holding qualities Pest & weed pH control Pre-harvest handlingMineral residuals Irrigation & preparation Plant densities Soil type Time & method of harvest Agronomic Harvest & Soil Practices Extraction Practices
    • Automobile Chassis Engine Tires Control & Braking System Environment management Systems RubberSuspension Fuel Electronics Alloys Road Rules systems Compression Chemical Hydraulics Roads & Steel Microprocessors & Processes Carriageways Combustion Plantations
    • The Past Present The Future Time The effect of competitor innovation will bring We know the present and product evolution and can learn about the past. create new market segments Examples: 2 in 1 shampoo & Sugarless carbonated drinks Market Timeline No change Radical change in technology will bring a Without any changes new Industry our timeline will remain fundamentally unaltered. Examples: Home computers in the 1970s & mobile phones in the 1980s Time
    • Decrease in economic development Conflict of values Local people Higher land taxes to support struggle to local infrastructure survive Massive Increase land demographic prices Rising land changes Less land available prices for farmingInflux of out of Locals emigrate region land from region buyers Lush Beautiful farmlands Increased conservation and hinterlands
    • New PollutionParadigms Economic A situational analysis of the environment Fossil Fuels Growth Export/Import Transport Farm Raw materials Transport Government Power Production Transport Diversity generation Warehouse Management Supermarket Conflict Research & Community Development Consumption Education Regulation Competition & Tension Air Transport Poverty & Unhappiness Development Waste Health Uncertainty
    • The world is seen from our own perspective – our narrative
    • Narrative expresses …………….. Hopes Feelings Ethical & spiritual codes Social hierarchies Empathy Imagination Self identity Fears Our introspections Sharing values Sharing beliefs Means of transferring ideas Problem solving Our projections Our relational position to society Meaning
    • Narrative Compresses Time to a Manageable Dimension
    • The truth keepschanging as we see new things