Abhishek Shah 110526481 NBS8036 9 January 2011

Assignment 1
Essay Plan
Q) What can large corporations learn from entrepreneurial small businesses, in terms of effectively developing and managing the organisation? Critically evaluate this question, drawing upon examples from both theory and practice. Outline The essay will mainly revolve around in addressing development and managing small entrepreneurial business. Theories used in small business will be backed by practical examples to critically evaluate the question. According to the article, 'Entrepreneurial action, innovation and business performance: The small independent business' the authors Georgellis, Joyce & Woods say that to successfully grow a small business, 1) capacity for innovation, 2) capacity to have successful plan ahead, 3) risk takers are the 3 integral parts.(1999,pg.2). All the 3 integral part depend upon an effective core management, because an effective management can only innovate, plan and take risk in the right direction to make their business successful. Many authors have said that an small entrepreneurial business should possess endless list of qualities which will be discussed in brief in the essay. In the article Small Business Economics: A Global Perspective, by the author Acs, speaks about the new debate regarding who is more successful small business or large corporations? the author talks about the large corporation and its success in the early nineteenth century. It was predicted that the large corporations would outperform the small business in the long run. Another similar article Entrepreneurship, small business and economic growth by Thurik & Wennekers also talks about the success of the large corporation. But after the year 1970, both the articles talk regarding the rise of the small entrepreneurial business. Both the articles are similar and give the reasons for decline of the large corporations, its impact on the economy, the shift from the large corporations to small entrepreneurial business, the causes of the shift, consequences of the shift and how to effectively manage a small entrepreneurial business and growth and what can large corporations learn from them. The next step is to research on the management styles of small entrepreneurial business and to distinguish them from large corporations and understand in theory that they can learn and implement in large corporations.

Topics revolving around the essay To critically assess the question, more research will be required around the topic to improve the quality and creditability of the essay. The articles Small Business Economics: A Global Perspective, by the author Acs & Entrepreneurship, small business and economic growth by Thurik & Wennekers also talk about the economics and its contribution to the economy. Understanding the economy side is important for this essay because, it gives an outlook of the success rate of small entrepreneurial business comparing to the large corporations. Until the mid-1970s, the evidence indicated that small firms were indeed becoming less important over time. While the average real GNP per-firm rose by nearly two-thirds between 1947 and 1980, from $150,000 to $250,000, it declined by about 14 percent to $210,000 during the subsequent six years ( Acs,1992,pg.2). But after 1970, large corporations began to fall apart and gave growth to small entrepreneurial business backed by many economic reasons which will be highlighted in the essay and further research with the help of Small Business Economics by David S. Evans will give valuable insights on the topic. Understanding regarding the theories and paradigms of management & entrepreneurship towards small business is another aspect will be addressed in the essay. In the journal article Entrepreneurship and the theory of the firm by the author Casson discusses about the relation between entrepreneurship and a firm. The author says that adding entrepreneurship to a business makes radical changes in the integral system of a business. Adding entrepreneurial edge to a small business helps the business to grow and develop. The author describes the theory of firm size and entrepreneurship relation with success. The author discusses the ideal size of a firm to make it a success. Another article Small Business and Entrepreneurial Research by Grant & Perren describe regarding the meta theories and paradigms of entrepreneurship relating to small businesses. A comprehensive research should be done in the next step on the this article which will help in critically assessing the question theoretically. The important role of entrepreneurial activity for the conversion of technological and organizational innovation into new and more efficient products and services is well known (Schumpeter, 1934). An another article, The Relationship of Entrepreneurial Traits, Skill, and Motivation to Subsequent Venture Growth by Baum & Locke say that goal, self- efficiency and effective communication help in growth of a small business. They back their findings with the help of a research, which indicate these findings. Current Scenario The current recession has given an impetus to the rise of small entrepreneurial business, due to massive downsizing of large organisations. Small firms have created job opportunities and therefore working in small groups have increased efficiency. In the article Growth, Diversification, and Business Group Formation in Entrepreneurial Firms, the authors Iacobucci & Rosa have described the new concept of 'Business group formations'. According to this concept large companies are broken down in to small subsidiary companies holding by a main parent company. The small subsidiary companies have their own heads and are managed by entrepreneurs. This helps in success of such small subsidiary companies which indirectly helps the parent company to grow successfully. An practical example of TATA

group of companies in the article The Right Way to Restructure Conglomerates in Emerging Markets by Khanna and Palepu have described the restructuring of TATA group of companies in to small subsidiaries and running them efficiently. Such an pratical based example will help to support the evaluation topic. More practical research is the next step of the plan before actually writing the essay. More practical examples from small successful companies will help in balancing the essay for all the theory produced above. Conclusion After developing more research from theory as well as practical base it will help in concluding that Large organisations have to learn many things from small entrepreneurial businesses. Real world practical examples will also help in making a well balanced essay.

REFRENCES JOURNALS
Acs, ZJ 1992, 'Small Business Economics: A Global Perspective', Challenge (05775132), 35, 6, pp. 38-44, Donato Iacobucci, Peter Rosa, Growth, Diversification, and Business Group Formation in Entrepreneurial Firms, Small Business Economics (2005) 25: 6582 Hayward, A.; Todd, A.; Reynolds, C.; , "Meeting the Global Challenge through a Collaborative Business Strategy for Small and Medium-sized Enterprises," Management of Innovation and Technology, 2006 IEEE International Conference on , vol.1, no., pp.11-15, 21-23 June 2006 J. Robert Baum and Edwin A. Locke, The Relationship of Entrepreneurial Traits, Skill, and Motivation to Subsequent Venture Growth, Journal of Applied Psychology, 2004, Vol. 89, No. 4, 587598 Mark Casson, Entrepreneurship and the theory of the firm, Journal of Economic Behavior & Organization, Volume 58, Issue 2, October 2005, Pages 327-348, ISSN 0167-2681, 10.1016/j.jebo.2004.05.007. Morrison, A, Breen, J, & Ali, S 2003, 'Small Business Growth: Intention, Ability, and Opportunity', Journal Of Small Business Management, 41, 4, pp. 417-425. Paul Grant and Lew Perren, Small Business and Entrepreneurial Research : Meta-theories, Paradigms and Prejudices, International Small Business Journal, May 2002 vol. 20 no. 2 185-211 Steinmetz, LL 1969, 'CRITICAL STAGES OF SMALL BUSINESS GROWTH', Business Horizons,12, 1, p. 29.

Yannis Georgellis, Paul Joyce, Adrian Woods, (2000) "Entrepreneurial action, innovation and business performance: the small independent business", Journal of Small Business and Enterprise Development, Vol. 7 Iss: 1, pp.7 17

Keith Glancey, Determinants of growth and profitability in small entrepreneurial firms, Inte Jnl of Entrepreneurial Behaviour & Research,Vol. 4 No. 1, 1998, pp. 18-27.