Strategic thinking by entrepreneurs
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Transcript of Strategic thinking by entrepreneurs
Strategic Thinking by Entrepreneurs
Lecture by Prof. Jorge Saguinsin
at the
Ateneo Graduate School of Business
Makati Philippines
Question:
Entrepreneurs do not practice/understand
strategy?
Strategy as ordinarily understood
Small entrpereneurial businesses must
necessarily be strategic!
Three characteristics of entrepreneurial business:
Growth
Differentiation
Strategic Direction
A business that lacks any one or all of the three is a “me too” business. It is a business, but not an entrepreneurial business. It is where thousands of small enterprise are.
And is bound to die early…
Definition of Strategy:
“A concept of how objective/s are met
with available resources.”
A new enterprise does not have much
resources; resources are meager; the
entrepreneur is the RESOURCE!
The entrepreneur: the means to success!
Machiavelli
“The end justifies the means”
-The Prince
The ends and the means…
Speaking of capital:
The start up money of the entrepreneur is his savings and some money borrowed from relatives and friends.
The real capital is capito – head!
Capital – capito - Head
Process in strategic planning:
1. Allocation of resource
2. Scanning the relevant environment
3. To reach desired goals/objectives
Small amounts as start up capital
Rev. Butch Salvador started his Car Magic business with ten pesos to photo copy brochures!
Wellington Soong of the Jaguar franchise started his business with one hundred pesos to print brochures!
Toby’s Peanuts started with P3t pesos!
Starting with very little capital
Cellphones are more expensive than their
start up capital!
Objectives for the entrepreneur
To survive
To thrive
To dominate competition
To win over competitors
Military Strategy
“Strategy is practical adaptation of means
placed at general’s disposal for the attainment of object of war”
(Helmuth Karl Berhard Graf Von Molkte, 1800-189l)
Von Molkte
Military Strategy
“Tactics is the art of using troops in battle;”
“Strategy is the art of using battles to win war”
(Carl Von Clausewitz 1780- 1731)
Clausewitz
Liddell Hart – the strategy of indirect approach
Sun Tzu – The Art of War
Sun Tzu
Strategic Thinking Practices of
Entrepreneurs
Business Strategy
“Competitive strategy is about being different. It means deliberately choosing a set of activities that deliver a unique set of values…”
(Michael Porter, 1947)
Michael Porter
Value chain
Answering a set of questions
1. Where are we now?
2. Where are we going?
3. How do we get there?
(-Peter Edelman, SVP of Voith Turbo)
Interplay of C’s
CUSTOMERS
COMPANY
COMPETITORS
(-Kenichi Ohmae, 1943)
Kenichi Ohmae – Mind of the Strategist
Mental Model
“Deeply ingrained assumptions, generalizations, pictures, images, that influence how we view the world and take action…”
(Peter Senge, The Fifth Discipline, l992)
Peter Senge – The Fifth Discipline
The Five Disciplines
Vision/Point of View
Importance of well articulated sense of purpose for the business enterprise.
Purpose precedes products and other activities. The purpose dictate
how to achieve the objectives,
Vision and My Vision Board
A perfect fit:
Competency - where you are good at
Passion
Economic engine
(Jim Collins, Good to Great)
Good to Great - Jim Collins
Being goal oriented:
SMART“Begin with the end in mind”
(Stephen Covey) “Running a business is the opposite
of reading a book. You begin with end in mind “ (Harold Geneen, fmr
chairman of ITT from Managing)
Begin with the end in mind..
Managing by Harold Geneen
Business is unlike reading a book; you begin with the end and then you go back
to the beginning…
Opportunity seeking, screening, seizing
Whenever enterprises practice these, they are engaged in
strategic management!
Quotations:
“ In order to predict the future, you have to invent it” - Ronald Pineda, owner of Folded and Hung.
“ There are three types of people: those who do not know what happened, those who watch things happen, and those who make things happen.”
“Predicting rain does not matter’; building the ark does.”
“ In order to succeed, you have to know what you want” – Tom Dizon, St. Catherine Realty
Ronald Pineda – Folded and Hung
Who now says that entrepreneur do not practice/understand
strategy?
Lecture for Ateneo Entrepreneurship
Students
Presented by:
Prof Jorge Saguinsin
Profjorge.entrep@gmail .com
Acknowledgement:
Images were taken from Google images The other ideas are taken from existing
literature on strategy and entrepreneurship; Quotations are from the entrepreneur guest
of the presenter in his entrepreneurship class