Entrepreneurial  Management    

Entrepreneurship  101  October  24  2012  Jon  E  Worren  

About  you  

Idea?  

Product?  

Business?  

Established  pracBces  not  working  

Share  of  Voice  

Share  of  Mind  

Share  of  Market  

The  Emergence  of  New  PracBces  

1911  ScienBfic  Mgmt  

1948  Toyota  

ProducBon  System  

2001  Agile  Development  

2003    Lean  

Thinking  

2005    Customer  

Development  

2009    Lean  

Startup  Mvmt  

A  set  of  principles  and  frameworks  that  helps  startups  iden5fy  a  sustainable  business  model  

with  the  least  amount  of  waste  possible  

Entrepreneurial  Management  

     

ApplicaBon  

Startup  Phase    

Entrepreneurial  Management  

 TradiBonal  

Management    

Growth  Phase  

Search  

Business  Model?  

ExecuBon  

PRINCIPLES  Entrepreneurial  Management  

ScienBfic  Management  

•  Time    &  Work  Studies  (measurement)  

Toyota  ProducBon  System  

•  Muda  –  EliminaBon  of  waste  

•  Hansei  -­‐  learning  •  Kaizen  –  conBnuous  improvement  

•  Jidoka  –  self-­‐learning    

Agile  Development  

•  Customer  CollaboraBon  •  IteraBon  (short  Bme  frames)  

Lean  Thinking  

•  GeneralizaBon  of  TPS  •  Increased  focus  on  “Value”  

Customer  Development  

•  New  1:  De-­‐risking  a  new  venture  by  breaking  up  the  commercializaBon  process  and  prioriBze  business  problems  to  solve  

•  New  2:  Focus  on  Customer  AcquisiBon    

Customer  Discovery  

Customer  ValidaBon  

Customer  CreaBon  

Company  Building  

Lean  Startup  

 •  Lean  Startup  =  Customer  Development  +  Agile  development  

•  Strong  build+  measure  focus  

•  Popularized  approach  –  created  Lean  Movement  

Build  

Test  

Measure  

Learn  

PROCESS  Entrepreneurial  Management  

Process  

AssumpBons  

Test  problem  AssumpBons  

Measure  

Evaluate  

Step  0-­‐  Describe  Idea  §  What kind of problem do you solve for the

customer? Is this an important problem for these customers? "

"§  Is there a big potential market for your idea? ""§  What is your competition and how do they solve

this problem for their customers today? ""§  What is unique about your way of solving the

problem?"

Step  1  –  Review  AssumpBons    •  Is  the  customer  problem  you  are  solving  validated  by  a  measurable  fact?    

•  Are  you  able  to  idenBfy  which  customers  are  suffering  the  most  from  this  problem?    

•  Do  you  understand  how  the  problem  impacts  the  customer  and  their  business?    

•  Do  you  have  evidence  that  links  the  customer  problem  to  the  target  customer?    

Step  2  –Test  

•  What  key  piece  of  informaBon  would  validate  or  invalidate  the  assumpBon?  

•  Where  does  that  informaBon  reside?  •  What  is  the  best  way  to  gather  that  informaBon?    

Step  3  &  4  –  Measure  &  Evaluate  

•  Is  the  customer  problem  urgent?  •  Is  the  problem  pervasive?  •  Will  customers  pay  to  have  the  problem  solved?  

How  do  these  answers  measure  against  your  iniBal  assumpBons?    

3  outcomes  

Evaluate  

Validate:  Confirmed  value  of  MVP  

Iterate:  Change  your  product  features  

Exit:  Don’t  spend  any  more  money!  

The  Pivot  

Easier  when….  •  You  have  invested  liile  to  this  point  

•  You  are  gejng  absolutely  no  tracBon  

Harder  when…….  •  High  noise  to  signal  raBo  (  no  clear  feedback)  

•  Next  step  is  unclear  

Entrepreneurs  are  eternal  opBmists  –  choose  to  persist:  -­‐  Tweak  a  liile:  Our  next  version  will  take  off!  -­‐  Easy:  Our  next  campaign/trade  show  will  land  key  customers!  

THE  3  STAGES  OF  THE  PROCESS  The  quest  for  a  Business  Model  

The    3  stages  of  the  search  process  

Customer  Problem  

Product  SoluBon  

Business  Model  

Business  Model  Canvas    

What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?

Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?

For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?

For whom are we creating value?Who are our most important customers?

What type of relationship does each of our CustomerSegments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?

What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?

What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?

Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?

What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?

Day Month Year

No.

This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/

or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.

Value  ProposiBon  

•  What  you  offer  and  how  you  offer  it  to  customers    

•  What  type  of  value  or  benefit  is  associated  with  your  offering  (e.g.,  cost  savings,  Bme  savings,  revenue  increase,  customer/employee  saBsfacBon)  and  how  much  of  it  the  customer  can  expect  

•  How  the  value  is  generated    •  Why  it  differs  from  anything  else  on  the  market    

Examples  

Winners  Winners is a department store that offers fashion conscious consumers the latest brand names for up to 60 per cent off.  

Google  Google is the world’s largest search engine that allows internet users to find relevant information quickly and easily  

CONCLUSION  &  SUMMARY  Final  two  slides  

Summary  

•  Startups  are  different  •  Search  is  about  learning  •  Lean  is  about  minimizing  waste  

•  CDM:  De-­‐risk  your  venture  by  breaking  up  the  process  

•  Test  for  customer  problem  first  

•  Test  soluBon/MVP  •  Test  customer  acquisiBon  

•  Human  element:  Give  someone  the  task  to  keep  you  accountable!  

Conclusion  

•  Entrepreneurial  Management  offers  a  set  of  tools  and  processes  that  makes  the  process  of  starBng  up  more  manageable:  

•  The  philosophy  brings  clarity  to  the  skillset  required  to  succeed:  – Less  persistence  –  more  percepBon  – Stack  the  odds  in  your  favour  –  rather  than  trying  to  win  against  all  odds  

– Commit  to  the  process  –  not  the  idea      

Thank  You!  

www.marsdd.com/entrepreneurs-­‐toolkit