APT 2053

DEVELOPMENT AND
MANAGEMENT OF NEW
ENTERPRISE
ENTREPRENEURIAL
MANAGER
 The Entrepreneurial Domain
2–2

 Converging on the Entrepreneurial Manager

“ A good entrepreneur is usually not a good manager,
since he or she lack the necessary management
skill and experience”.
(entrepreneur’s ability to have or develop competencies as an
entrepreneur manager)
Three ways to adapt

Shift from creation to exploitation

Shift from passionate commitment to dispassionate

objective
Shift from direct personal control over organizational
actions to indirect impersonal control
 Dominant Venture Model
2–3

 Principle Forces and Venture Models

Seed/Startup High Growth Maturity
Most Most
Higher potential, growth-minded Higher potential, growth-minded
Entrepreneurial

ventures venture

Change and
uncertainty
Lifestyle, mom-and-pop ventures Mature, bureaucratic dinosaurs
Least Least
Least Most
Administrative

Entrepreneurial domain
Figure 2.1 Dominant Venture Model
Administrative domain Source : Timmons & Stevenson (1985) in
Timmons &
Spinelli (2007)
 Principal Driving Forces
2–4
Figure 2.2 Principal Driving Forces

Seed/Startup High Growth Maturity

Most Driven by: Driven by: Most

•Creativity •Rejuvenators and innovators
•Collaboration within the firm •Opportunity focus
•Opportunity focus •Resource ownership

Change and uncertainty

•Resource requirements expanding •Capital gain
Organization: Organization:
Entrepreneurial

•Informal •Formal
Driven by: Driven by:
•Few owner •Administrators/ trustees
•A specific product •Product focus
•Burdensome resource requirements •Resource ownership
Organization: •Quarterly profits
•None or too rigid Organization:
•Formal
Least Least

Least Administrative Most

Entrepreneurial domain
Administrative domain
 Stages of Growth
2–5
Figure 2.3 Stages of Venture Growth, Crucial Transitions and Core Management Mode

 A Theoretical View
 Stages of Growth (cont’d)
2–6

• A Theoretical View
Stages
Research and -refer to the nascent stage
development -characterized by a single aspiring entrepreneur or small team
(R&D) -if an idea is not turned into a going concern within 18 months, the
chances of a startup fall dramatically.
Start-up -cover the first, two or three years
- the critical mass of people, market and financial results and
competitive resiliency are established; while investor, banker and
customer confidence is earned.
High growth -most difficult challenge for the founding entrepreneur, when he
@she finds it is necessary to let go of power and control
Maturity stage -no longer survival; rather, it is one of steady, profitable growth
Stability -involve management orientation
-interpersonal supporting and nurturing
 What sort of skills and
Stages of Growth (cont’d) personality are required to
achieve such high levels of
performance in a dynamic and
uncertain market place?

Figure 2.4 Stages of Growth

Stages of Growth (cont’d)
Figure 2.5 The 7 Habits of Highly Effective People
Source: Stephen Covey’s in Timmons & Spinelli (2007)

Interdependenc Continuous
Independence
e Improvements
• Be Proactive • Think Win- • Sharpen the
• Begin with the Win Saw
End in Mind • Seek First to
• Put First Understand,
Things First Then to be
Understood
• Synergize
 Management Competencies
2–9

 What is competencies?
 “A capacity that exists in a person that leads to behavior that meets the job
demands within the parameters of organizational environment, and that, in turn
brings about desired results.”(Boyatzis, 1982)
 “An ability to perform certain tasks for which knowledge, skills, attitudes and
motivations are necessary” (Gibb,1990)
 “An underlying characteristic of an individual that is causally related to
criterion referenced effective and/or superior performance in a job or situation.
(Spencer,1993)
 “Combination of knowledge, skills and attitudes which are required by
employees in their jobs or tasks (Stoof, 2005).
 “ the sum of experiences, knowledge, skills and attitude which we acquire during
our life time for effective performance in a task or job. (Kaur & Bains, 2013).
 Management Competencies
2–10
(cont’d)
Management Competencies

Skills in building entrepreneurial culture Others

Leadership, vision, influence Marketing

Helping, coaching and conflict

Operation/Production
management

Teamwork and people management Finance

Entrepreneurial Management

Law and Taxes

Information Technology
 Conclusion
2–11

 Several studies have found positive relationship

between existences of competencies and venture
performance. For the survival and success of the
business entrepreneurs required skills, knowledge,
abilities and attitudes.
 APT 2053
DEVELOPMENT AND MANAGEMENT OF NEW
ENTERPRISE

INTEGRITY OF
ENTREPRENEURSHIP
 Integrity and Entrepreneurship
2–13

 What Is Integrity?
 An uncompromising adherence to the lofty values,
beliefs and principles that an individual claims to hold.
 Honesty, reliability, and fairness in business practices
 An essential element of successful business relationships
 Is as much about what to do as it is who to be.
 Building a Business with Integrity
2–14

 The Foundations of Integrity

 Underlying values: unarticulated ethical beliefs that
provide a foundation for ethical behavior in a firm.
 Are based on personal views of the universe and
mankind.
 Strongly held views can lead to tough choices.
 Ethics of the firm affect how outsiders view of the firm
and their decisions about the firm.
 Building a Business with Integrity (cont’d)
2–15

 Leading with Integrity

 Owner/leaders and their ethics have more direct and
pronounced effects in small firms.
 Owner/leaders can insist
that ethical principles be
followed by employees.
 Building a Business with Integrity (cont’d)
2–16

 An Ethical Organizational Culture

 Building an ethical culture requires:
 Full commitment to ethical conduct by the firm
 Strong, ethical managerial leadership
 Code of ethics
 Firm’s official standards of employee behavior.
 The foundation for ethical conduct by employees
 Clarifies the rules and gives guidance to employees
 Fundamental Principles for Ethical Policy Making
2–17

Purpose

Perspective Pride

Persistence Patience
 The Ethical Decision-Making Process

1 Define the problem

2 Identify alternative solutions to the problem
3 Evaluate the identified alternatives
4 Make the decision
5 Implement the decision.
6 Evaluate the decision.

2–18
 Conclusion
2–19

 Integrity refers to a general sense of honesty and

reliability that is expressed in a strong commitment
to doing the right thing, regardless of the
circumstances.
 “Doing anything for money” can quickly lead to
distortions in business behavior.