Introduction
Creativity and innovation are becoming the pillar of entrepreneurship in the 21st century, entrepreneurs are on the lookout for opportunities that arise in the environment and therefore they develop mechanisms which they can use to harness the power of animation and turn ideas into business (Carsrud & Brännback 2007, p. 15). Furthermore, the consumers go ahead and demand new products and services that can be conveniently delivered to them in order to satisfy their needs and wants.
Entrepreneurs, therefore, look within the internal and external environment of their operations and come up with top-notch strategies that will enable their organizations to succeed in the industry of business (Goodstein et al. 1993, p. 20). It is therefore key that organizations and entrepreneurs involve themselves in creating tactics that will help their businesses and ideas compete with others and outshine competitors, therefore it is by a continuous gathering of research that is relevant to the business context that will enable planning within various functional areas of operation be successful.
Idea generation
The idea generation process which primarily involves coming up with unique innovative products and services that are in line with customer needs and market demand is a very critical and delicate process (Carsrud & Brännback 2007, p. 41). If an entrepreneur messes up in this stage then most likely the whole product/service that will produce is most likely not to succeed. The new product development process is a very pivotal process that goes into coming up with products that are in tune will current market situations (Kotler, 2003, p.55).
Peter Jones is a British entrepreneur who believes that ideas are the backbone for any business idea. He often insists that an entrepreneur who has no funding can always get support from other parties so long as he/she has a full-proof idea. A good idea must be researched on and supported by statistical evidence that goes ahead to quantify the likelihood of it succeeding in its prospective market (Kotler, 2003, p.15-25).
Furthermore, a good idea aims to target the particular needs and desires of prospective consumers by catering to their specific needs (Bannatyne et al. 2008 p.10-33). The idea should also be supported by a strategy that will aim at making it succeed such strategy should therefore strive to be superior and efficient. Peter Jones, therefore, believes a good idea that is in tune with its environment is, therefore, more likely to succeed when it is implemented by an entrepreneur according to peter Jones and consequently bad ideas that do not cater to the needs of a particular market will soon fail even if it is excessively funded and supplied with resources.
Peter Jones believes that coming up with numerous ideas is the greatest tool that an aspiring entrepreneur has, furthermore by having and ability to make a judgment to deduct if the idea is viable and workable is very important and therefore conducting a survey of strengths on which one can capitalize on and weaknesses which are to be improved upon is necessary.
Therefore an entrepreneur should go forward and gather relevant data from the best sources such as financial papers and publications, the national bureau of statistics, associations, and by networking with known successful entrepreneurs. It is these sources that peter Jones believes that they will give an entrepreneur the real picture of demand patterns related to the product or service and how to solve any weaknesses that an entrepreneur might have come across during the idea generation process (Casson 1982, p.64)
Peter Jones believes that after coming up with an idea it is important to access it from all angles if it is implementable (Bannatyne et al. 2008, p. 10-27). Therefore, come up with a comprehensive list of the merits and demerits of the idea itself. Therefore an entrepreneur should also ensure that he/she maintains originality and uniqueness, the ability of market growth if an idea falls within a mature market that growth is stunted then the chances of success are slim. Furthermore, an entrepreneur can do well by importing ideas from abroad and repackaging them, to serve a niche market, and forming a company that can go multinational.
A company like Starbucks is known to be a prospector that focuses on product innovation and marketing opportunities (Wheelen & Hunger 2002, p.66-67). Recently Starbucks expanded its business portfolio and came up with a joint venture that will have its music business unit included in the iTunes store so that customers can download music played in Starbucks stores as they enjoy their favorite drinks.
Strategic objectives
Once an idea is created by an entrepreneur it is vital that an entrepreneur creates a comprehensive blueprint or plan that includes short-run, midterm and long-range business plans (Reynolds2007, p. 3-12). These will normally include the mission, vision, objectives, strategies, policies, programs, budgets, procedures, and evaluation performance techniques that the prospective business idea will follow in order to succeed in the industry (Steiner 1997, p. 20-55). The strategy is therefore a business path that a business organization intends to follow in order to realize its business objectives.
For instance, Apple is well known for its high degree of innovation. Apple’s technological strategy is called a leapfrog strategy that involves producing superior products before other companies can do so (Hitt et al. 2009, p. 121). Apple has adopted a growth strategy that intends to produce diversified products and compete with other competitors by creating highly differentiated products and charging a premium for them within various parts of the world (Paul 2008, p.276-286). A price skimming strategy that aims to maximize revenue streams is implemented for Apple’s technological products such as the computers and iPod.
Marketing analysis and research
Companies that generate ideas and come up with products and services either have the option of serving the mass market which is targeting the whole market, segmentation which is serving a given portion of the whole market for example children, or target marketing which involves further dividing a market segment into much smaller constituents for example children within ages 1-5 years, (Brassington & Pettit 2006, p. 33-65).
Starbucks ‘ pricing model depends on whether a product is a low-end product or a high-end product, this is because there exist both premium highly differentiated products such as the Frappuccino’s and Caramel Macchiatos, while lattes and brewed coffee which is less differentiated less premium products. Therefore Starbucks conducts its product research and generates ideas depending on which market segment they are aiming to serve and satisfy consumer needs (McDonald 2003, p.40-120)
Competitive strategy and scenario analysis
According to Porter who is a well-known authority in company strategy and company competitiveness who is a professor and departmental chair in Harvard Business School’s program (1990 p.56), a company generic competitive strategy may be cost-based or differentiation based.. Starbucks being a prospector with fairly broad product lines that focus on product differentiation and marketing opportunities (Wheelen & Hunger 2002, p.66-67) were forced to change their strategy.
Being a company that is a prospector means that a company dedicates a lot of resources to come up with products and services that are considered innovative, premium, and of high quality for the market. Stiff competition from McDonald’s and Dunkin Donuts who were, in fact, charging lower prices and attacking Starbucks through their marketing campaigns such as advertisements’, further worsened the situation for Starbucks forcing Starbucks to reduce prices for its lower-end market and slightly increase the price for its high-end products therefore taking advantage of its more loyal customers.
Financial planning
Financial planning is a critical and important part of entrepreneurial ventures, even the best ideas in the world need financial backing and therefore entrepreneurs are forced to make substantial plans that will cover budgeting, saving, investment, debt payment, tax, retirement programs, and the costs of day to day operations (Porter 1990, p. 188). Pizza Hut has a centralized finance department that is responsible for controlling and planning. Pizza hut is known to be superior in planning because it can handle numerous franchises and perfectly assist them in financial planning.
The pizza finance department works together with all existing and wannabe franchises and assists them in the process of making financial plans and setting controls for these plans (Rea & Kerzner 1997 p.50-53). The finance department usually sends out its team to go and assist entrepreneurs who take up franchises and come up with good business ideas on how to prepare the income statements, budgets, cash flow statements, and proforma and balance sheets that will assist the business in an optimal allocation of resources. Capital Planning is a vital component of pizza Hut’s financial planning that calls for the evaluation of proceeds investments, new store openings, and systems development projects.
Failure of financial planning, in this case, may result in the faulty allocation of resources that may at the end of a business cycle indicate that financial resources were abused and not optimally used to meet business objectives (Brigham & Houston 2009, p. 56-104). An entrepreneurial idea with poor financial planning is doomed to fail, many businesses simply fail in the first five years not because the ideas were poor but because the financial planning was somehow mediocre (Wheelen & Hunger 2002, p. 301-323). Therefore companies like pizza hut have understood the importance of financial planning in the process of backing up ideas that have been generated by entrepreneurs because it is a key pillar to the success of business enterprises in the long run.
Entrepreneurship
Entrepreneurs are known to be highly talented individuals who carry specific traits that enable them to come up with ideas that start businesses and make them successful (Reynolds 2007, p. 3-5). It is in the same way that entrepreneurs are able to come up with ideas using these traits and help already established businesses that are in the growth or maturity phase come up with ideas that will increase their business potential in the market.
It is through risk-taking (Kuratko 2008, p28-52), proactiveness, and innovation that entrepreneurs go ahead and use their special characteristics to survive in today’s business environment and produce satisfaction for consumers (Kotler & Keller 2009, p. 320 ). Entrepreneurs often possess the following characteristics which include self-confidence, ambition, hard work, commitment, and a strong ego, and autonomy. There may exist ambiguity in places where an entrepreneur carries out his/her business operations but an entrepreneur uses skills available to maneuver his/her way and meet targets (Carsrud & Brännback 2007, p. 14-23).
Characteristics
An entrepreneur is self-confident
An entrepreneur is able to believe in his own ability/power to achieve his/her targets and thus acts on instincts in order to realize success (Kumar 2008, p. 38-44). Therefore, with self-confidence entrepreneurs go ahead and seek opportunities that they highly believe that they can succeed in (Drucker 2006, p.42-47). Richard Branson in his autobiography says that as an entrepreneur he never doubts his ability to pursue a business course and make it a success so long as one puts his mind to it, he goes ahead to state that this is the kind of mind-frame that every entrepreneur should have. Therefore Branson believes that if you don’t believe in your own capabilities as an entrepreneur then the chances of your success then also become slim (Morris 2003).
An entrepreneur is ambitious
Ambition is a strong desire for personal achievement (Kumar 2008, p. 39-43). Entrepreneurs often have a strong cherished desire to establish their own innovative ventures and see them succeed, gain fame and raise them to positions of power. Entrepreneurs are visionaries who are able to see ahead and convince themselves to make a huge impact and achieving their goals. Richard Branson still believes that there is massive room for expansion and diversification that the virgin group has to harness.
Branson believes that taking people to outer space is not the final frontier of business for Virgin. No other companies including the mighty British Airways have even thought of taking passengers to outer space but Branson has gone ahead to form Virgin Galactic that will be an outer space tourism company (Branson 2006, p. 56; Jackson 1998, p. 45).
Hard-working
An entrepreneur is a person who puts a lot of effort and dedicates his time to his ideas in order to realize success. Many are times that entrepreneurs decide to give up when they are hit by misfortune, but Richard Branson believes that misfortune should encourage an entrepreneur to put in more effort into his venture. When Branson found out he was dyslexic and the first venture of selling Christmas trees and budgerigars failed he decided not to give up but put in more effort in his entrepreneurial quest and therefore he believes every entrepreneur should do this. When an entrepreneur comes up with an idea he/she, therefore, gives it all his/her concentration and applies all effort and time towards ensuring its success and if he/she fails he goes ahead to look for other opportunities to pursue.
Committed
An entrepreneur is committed. An entrepreneur sticks to his plan and ideas and full-backs them up with high hope that they will succeed (Kumar 2008, p. 39-43). Once an entrepreneur develops ideas and starts up an adventure that pursues to make profits he remains bound and loyal to his/her ideas (Gartner & Bellamy 2009, p. 32-64). Richard Branson believes in dedication and therefore insists on communication between himself and the over employees of Virgin, in fact, he goes a mile further to write them articles monthly and encourages them to write back are call him with any query or ideas that may improve on Virgins business operations. Branson believes it is through commitment that new business ideas and goals can be achieved.
Strong ego
A strong ego calls for a person to strongly establish himself and distinguish him/herself from others. Therefore every entrepreneur strives to make his ideas and venture to look original and different from others. An entrepreneur is somehow selfish and therefore always wants to have his/her (Reynolds 2007, 25). An entrepreneur aims to create a venture or a brand that is like no other person’s.
Branson believes in his creation the virgin brand and therefore makes sure that in every venture he undertakes that these brand and his identity is used to sell the product and ensure all clients that they are of high quality. It is therefore the wish of every entrepreneur to be identified by a particular brand that he/she created. It is this same brand that distinguishes his/her works from the works of other entrepreneurs making him unique and respected in the entrepreneurial community.
Autonomous
An entrepreneur is self-governing and independent meaning he/she is not influenced by others to make decisions (Kuratko 2008 p.15). He or she does research and when it comes to making a decision he/she goes ahead to make decisions that are fully informed without the influence and duress of unrelated parties. Therefore entrepreneurs most likely when making their decision are intrinsic and not subject to external forces.
Branson believes that entrepreneurs should be the ones that direct and decide the course of their businesses because they are they that they know what they want out of their ventures and therefore they should be autonomous and make rational decisions and if necessary follow their gut feeling (Dearlove 2007, p. 103). Entrepreneurs are unique people who are not subject to peer pressure but well-founded decisions (Wheelen & Hunger 2002, p. 150). Entrepreneurs deal with large sums of money and therefore know the risks that they face and therefore go-ahead to do research and gather relevant data that they base their decisions on.
A reflection on the extent of entrepreneurial skills required
Entrepreneurship is a complex and challenging discipline that calls individuals to exhibit certain behaviors that will enable consumers to overcome ambiguous situations within the environment of operations and emerge with successful business ventures (Hitt, et al., 2009 p. 55). Dynamically changing client base unpredictability of demand, dynamic cutthroat Technology, changing and complex resource situations, and complex legal and regulatory environment together with dynamic/diverse consumer needs are some of the ambiguous situations that exist in entrepreneurship (Avantoure, 2008).
It is, therefore, necessary for entrepreneurs to possess these specific skills and many more that will enable them to seek opportunities, take imitative and form risk-taking techniques that will enable their operations to be smooth. Furthermore, the existence of skills will enable the process of identifying and solving problems by use of individual judgment to take place effectively to achieve organizational success when complex ambiguous situations present themselves (Paul 2008 p. 79-84).
Skills go ahead and enable entrepreneurs to be flexible enough according to the situation. Entrepreneurs should not set rigid goals because sometimes goals can be forced to change depending on the situation and therefore entrepreneurs should learn to dynamically adjust their goals as events unveil themselves. This is simply to say entrepreneurship is a learning process by which entrepreneurs gain knowledge in real-time and make adjustments at the same time.
Entrepreneurs use their imagination and visions to make predictions that in turn justify their actions bringing a degree of certainty where uncertainty existed before. Entrepreneurs being committed and hardworking therefore go ahead and gather skills within various functional areas such as finance, marketing, accounting, planning, research, timekeeping, and strategy and therefore use this to counter the level of anonymity that may have existed before. It is with less ambiguity that a business environment is considered favorable to realize organizational success in the short run and long run (Hedley 2002 pg. 145).
Completion of market challenge report
After coming up with many ideas the group decided that it was most wise to establish a grocery store stall in Cambridge, which would also stock second-hand clothes and serve snacks. The market is viable and opted to engage a penetration pricing model. Sufficient funding can be secured by approaching a financial institution and sell the idea.
References
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