This document discusses strategic entrepreneurship and managing start-up stages in rapid growth industries. It begins by outlining the typical stages in a business cycle, including start-up, growth, maturity, and decline. It then focuses on characteristics of rapid growth industries and factors for achieving rapid growth, such as founder traits, firm attributes, business practices, and human resource management. Finally, it provides recommendations for start-ups and rapid growth companies, including choosing a strategic roadmap, creating an execution agenda, managing change, reinventing processes, and fostering collaboration between promoters and professionals.

1. STRATEGIC ENTREPRENEURSHIP
TOPIC 7
DR ANIS AMIRA AB RAHMAN
SITI AFIQAH BINTI ZAINUDDIN
FACULTY OF ENTREPRENEURSHIP AND BUSINESS
UNIVERSITI MALAYSIA KELANTAN
anisamira@umk.edu.my
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2. MANAGING START-UP STAGE IN
RAPID GROWTH INDUSTRY
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3. Strategic Entrepreneurship and Strategic Management
Source : Wheelen, T. L. and Hunger, J. D.
(2000 cited in Kuratko, D. F. & Hodgetts,
R. M., 2004: 521).
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4. What are stages in business cycle?
 Start-up stage: Strategies for the introduction stage
emphasize a buyer focus, building on advertising, and
increasing purchase frequency. Product development
was seen as important activity.
 Growth stage: Focus on strategic segmentation and
building efficiencies in production and marketing.
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5. What are stages in business cycle?
 Maturity stage: More complex, improving efficiency in
process, reducing overall costs in marketing and
distribution, further differentiation of products, and
further market segmentation.
 Decline stage: Little work has been done regarding
strategies leading to high performance in the decline
stage (i.e. Retain relationships with customer)
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6. Business Life Cycle
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7. Start up stage in business cycle
 Business is born and now exists legally
 Have overestimated money needs and the time to market
 The budget best be revised often because more cash might
be needed than expected
 Support and coaching of the CEO and board of directors
 Complete Business and Marketing Plan
 Assistance in negotiations for capital increase
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8. Type of start-up cost
 Start-up stage require establishing a customer base and
market presence along with tracking and maintaining cash
flow.
 Sales promotion consists of short-term incentives to
encourage purchase or sales of a product or service.
Whereas advertising offers reasons to buy a product or
service, sales promotion offers reason to buy now (Kotler
and Armstrong, 2013).
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9. Nature and Type of Rapid Growth
Industry (RGI)
 The “sales growth” is the main indicator to label any
rapid growth industries. With such indicator,
Barringer et al. (2005) define the rapid growth firms
as firms with a 3-year compound annual sales growth
rate of 80% or above, provide an important stimulus
to the national economy.
 In addition, rapid growth is frequently an indication of
market acceptance and firm success.
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10. Nature and Type of Rapid Growth
Industry (RGI)
These are several factors for firm’s ability to achieve and
maintain rapid growth, which are:
 (1) founder characteristics,
 (2) firm attributes,
 (3) business practices, and
 (4) HRM practices.
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11. (1) Founder characteristics
The relationship between founder
characteristics and firm growth is important for
at least three reasons:
it is widely believed that the founders of a firm place a
lasting “stamp” on their companies that influences the
cultures and behaviors of their firms (Mullins, 1996).
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12. (1) Founder characteristics
2. investors and others often assess the potential of a
new venture by evaluating the attributes of its
founders.
3. launching a new firm is a challenging process.
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13. (2) Firm attributes
 Two important attributes are:
1. a growth-oriented vision.
2. commitment to growth.
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14. (3) Business practices
There are several key business practices that typify
successful rapid-growth firms.
Creating unique value for customers.
Product superiority or Quality.
Innovation
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15. (4) HRM Practice
Human resource management practices must be
appropriate in sustaining the firms in rapid growth
industry. These involves:
 Selective hiring.
Performance-based incentives.
Stock option plans and employee stock ownership
plans.
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16. World Rapid-growth industries
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17. Cont..
 In Malaysia, several industries have been identified in the
category of rapid-growth industries such as E-Commerce,
ICT, Financial consultation, Consumer Product, Beverages
and etc. (BERNAMA, 2014)
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18. Start-Up and Rapid Growth Industry
Source : Aashish Mehra (2011)
Choose the 'rightroad to run'
Convert Strategy into clear execution agenda
Link execution agenda to on-ground action
Manage change for smooth transition
Create structure, culture for growth & professional 'tango'
Reinvent and reinforce core processes to 'run well on road'
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19. (1) Choose the “right road to run”
Instead of being largely opportunistic, they
meticulously plan the company’s growth, and
consciously choose which road to take. But this is only
half the battle won. To realize the “value potential”
created by it, companies need impeccable execution
and must “run well on the chosen road”- else,
significant value can be lost.
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20. (2) A clear execution agenda
Promoters convert their strategy into a well-defined
execution agenda for top management, with clear
initiatives, goals, responsibilities, timelines and resource
requirements.
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21. (3) Execution linked to “on-the-ground action”
They ensure that this execution agenda seamlessly flows into
their annual plans and budgets, and is rigorously reviewed by
top management.
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22. (4) Reinvent & reinforce core
processes to “run well on road”
Robust, world-class core processes. They identify a few core
processes, such as project planning and monitoring,
equipment utilization, bidding, risk management, resource
allocation and reinvent them to world class standards for
operational excellence.
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23. (5) Create structure, culture for growth&
promoter-professional “tango”
The “promoter-professional” tango, and a structure and
culture for growth. They realize early on that it takes both
promoters and professionals to do the billion dollar tango, and
create the requisite organizational structure and culture
conducive for growth.
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24. (6) Manage change for smooth
transition
Change management initiatives for smooth transition. They
drive change from the front; gauging and managing
stakeholder expectations, clearly communicating the changes,
and creating success stories.
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25. Dr Anis Amira Ab Rahman 14

26. REFERENCES
 Barringer, B. R., Jones, F. F., & Neubaum, D. O. (2005). A
quantitative content analysis of the characteristics of rapid-
growth firms and their founders. Journal of business venturing,
20(5), 663-687.
 Kotler, P. and Armstrong, G., (2013). Principles of marketing, 15th
ed. Prentice Hall.
 Kuratko, D. F., & Hodgetts, R. M. (2004). Entrepreneurship: Theory,
process, practice. Mason, Ohio: Thomson/South-Western
 Aashish Mehra, G. S. (2011). Managing rapid growth : How mid
caps can leap into the billion dollar club .
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