Timmons Ch 07 Fall 2006

7/28/2019 Timmons Ch 07 Fall 2006

1/26

The Entrepreneurial

Manager

Chapter 7

Dowling

BA 560

Fall Term 2006

7/28/2019 Timmons Ch 07 Fall 2006

2/26

The Entrepreneurial Manager

There are convergentpressures on being anentrepreneur and being

a manager as a ventureaccelerates and growsbeyond founder-drivensurvival. Key to futuresuccess is the ability of

an entrepreneur to haveor develop competenciesas an entrepreneurialmanager.

7/28/2019 Timmons Ch 07 Fall 2006

3/26

BA560 Venture Planning Prof. Dowling 3


Old CW: A good entrepreneur

cant be a good manager.

New CW: Ventures thatflourish beyond startup can

be headed byentrepreneurs who arealso effective managers.

Unconventional

Wisdom?

7/28/2019 Timmons Ch 07 Fall 2006

4/26



Founders adapt forthree key reasons:

Shift from creation toexploitation

Shift from passionatecommitment todispassionate objectivity

Shift from direct personal

control to indirect,

impersonal control.

7/28/2019 Timmons Ch 07 Fall 2006

5/26


Stages of Growth

Startup StageFrom 2 to 7 years; most perilous stage,characterized by efforts of leadentrepreneur.

High-Growth Stage

In this, perhaps the most challengingstage, new ventures fail at 60% rate.Lemons ripen.

Maturity Stage

Key issue is no longer survival. It issteady, profitable growth.

7/28/2019 Timmons Ch 07 Fall 2006

6/26


Stages of Growth

Startup High Growth Maturity Stability

0 3-4 10 15Time (Years)

Crucial Transitions:

Sales 0-$3Million $2-10M $7.5M+Employees 0 to 20-25 25-75 75-100+Management

Mode

Doing Managing Managing Managers

$100 M+

$50 M

$25M

$3 M

$1 M

7/28/2019 Timmons Ch 07 Fall 2006

7/26



Entrepreneurial CultureA common value system

Difficult to measure orarticulate

Belief in and commitmentto growth

Team feels theyre in this thing together

Goals and market determine priorities

7/28/2019 Timmons Ch 07 Fall 2006

8/26



The Fit Concept

It is important to have amanagement team whose

skills are complementary.

7/28/2019 Timmons Ch 07 Fall 2006

9/26



Entrepreneurship Influence Skills

Leadership/vision/influenceHelping/coaching and conflictmanagement

Teamwork and people management

7/28/2019 Timmons Ch 07 Fall 2006

10/26


Exhibit 7.1

7/28/2019 Timmons Ch 07 Fall 2006

11/26


Exhibit 7.2

7/28/2019 Timmons Ch 07 Fall 2006

12/26


Exhibit 7.3

7/28/2019 Timmons Ch 07 Fall 2006

13/26


Exhibit 7.4

7/28/2019 Timmons Ch 07 Fall 2006

14/26


Exhibit 7.5

7/28/2019 Timmons Ch 07 Fall 2006

15/26


Traits Characterizing RapidlyGrowing Companies

High levels of change, ambiguity, and uncertainty

Ongoing succession of nonlinear and nonparametric

events

Inexperience of management team

Counterintuitive, unconventional patterns of

decision-making

Informality and fluidity of organization structure andprocedure

7/28/2019 Timmons Ch 07 Fall 2006

16/26


Exhibit 7.6

7/28/2019 Timmons Ch 07 Fall 2006

17/26


Entrepreneurial Influence Skills

Interpersonal/teamwork skills

Ability to create, through management, a climate

and spirit conducive to high performance

Ability to understand the relationships among tasks

and between the leader and followers

Ability to lead in those situations where it is

appropriate

7/28/2019 Timmons Ch 07 Fall 2006

18/26


Characteristics of SuccessfulManagers

Managers skilled in leadership, vision, and

influence

Skillful in creating clarity out of confusion,ambiguity, and uncertainty

Able to define adroitly and gain agreement on who

has what responsibility and authority

Manage in a way that builds motivation and

commitment to cross-departmental and corporate

goals, not just parochial interests

7/28/2019 Timmons Ch 07 Fall 2006

19/26



Managers skilled at helping, coaching, and

conflict management

Creatively handle conflicts, generate consensusdecisions, and share power and information

Recognize that high-quality decisions require a

rapid flow of information in all directions

Accept that knowledge, competence, logic, and

evidence need to prevail over official status or

formal rank in organization

7/28/2019 Timmons Ch 07 Fall 2006

20/26



Managers skilled at teamwork and people

management Encourage innovation and calculated risk rather than by

punishing or criticizing whatever is less than perfect

Expect and encourage others to find and correct their own

errors and to solve their own problems

Make heroes out of other team members and contributors

Generate trust among colleges and subordinates

Perceived as honest and direct, open and spontaneous

7/28/2019 Timmons Ch 07 Fall 2006

21/26


Other ManagementCompetencies

Marketing Market research and evaluation

Marketing planning

Product pricing

Sales management

Direct selling

Service management

Distribution management

Product management

New product planning

7/28/2019 Timmons Ch 07 Fall 2006

22/26



Operations/Production Manufacturing management

Inventory control

Cost analysis and control

Quality control

Production scheduling and flow

Purchasing

Job evaluation

7/28/2019 Timmons Ch 07 Fall 2006

23/26



Finance Raising capital

Managing cash flow

Credit and collection management

Short-term financing alternatives

Public and private offerings

Bookkeeping, accounting, and control Other specific skills

7/28/2019 Timmons Ch 07 Fall 2006

24/26



Entrepreneurial Management Problem solving

Communications

Planning

Decision-making

Project management

Negotiating Managing outside professionals

Personnel administration

7/28/2019 Timmons Ch 07 Fall 2006

25/26



Law and Taxes Corporate and securities law

Contract law

Law relating to patent and proprietary rights

Tax law

Real estate law

Bankruptcy law

7/28/2019 Timmons Ch 07 Fall 2006

26/26



Information Technology

Information and management systems tools.

Business to business, business to consumer,

business to government, all via the Internet

Sales, marketing, manufacturing, and merchandisingtools.

Financial, accounting, and risk analysis and

management tools.

Telecommunications and wireless solutions forcorporate information, data, and process

management.

Documents

Timmons Ch 07 Fall 2006