210 likes | 223 Vues
0. MBAX 6100 Marshalling Resources. Frank Moyes Leeds College of Business University of Colorado Boulder, Colorado. 0. Today’s Agenda. Barbara Mowry, CEO Silver Creek Systems Strategic alliances Marshalling resources Bootstrapping Mid-term review. Next Week. Legal Issues
E N D
0 MBAX 6100Marshalling Resources Frank MoyesLeeds College of Business University of ColoradoBoulder, Colorado Marshalling Resources
0 Today’s Agenda • Barbara Mowry, CEO Silver Creek Systems • Strategic alliances • Marshalling resources • Bootstrapping • Mid-term review Marshalling Resources
Next Week • Legal Issues • Intellectual property • Employee agreements • Read BZ-9 & 10 • Case: Mason and Sheppard • Cooley Godward Marshalling Resources
Strategic Alliances Marshalling Resources
Strategic Alliances • Over 75% of technology businesses are active in strategic alliances. 63% said critical or very important. (PricewaterhouseCoopers, Trendsetter Barometer 2001). • Most are informal • Joint venture – jointly owned entity • Speed to market • Access to markets, technology or knowledge • Access to capital • Spin-ins & spin-outs Marshalling Resources
Strategic Alliances Forms • Marketing – access to distribution e.g. Nestle in Europe • Technological – joint research, e.g. Celebrex for Pfizer • Manufacturing – subcontract operations, e.g. Jurismonitor • Investment – Intel had 220 active investments in 2004 Marshalling Resources
Advantages to Strategic Alliances • Gain access to a resource, e.g. production, skills, capital • Economies of scale • Risk & cost sharing • Gain access to international market • Learning • Speed to market • Neutralizing or blocking competitors Barringer & Ireland, Entrepreneurship Marshalling Resources
Risks of Strategic Alliances • Loss of proprietary information • Management complexities • High risk of failure • Become dependent on partner • Risk of opportunism • Non performance • Loss of decision autonomy • Clash of cultures • Precludes partnership with another firm or exit Barringer & Ireland, Entrepreneurship Marshalling Resources
Marshalling Resources Marshalling Resources
0 What Resources Do New Ventures Have? • People • Physical Assets • Intangible • Financial • Social & Personal Marshalling Resources
Social Network • Network • Industry contacts • Mentors, YPO • Family • Outside service providers- legal, accounting, bankers • Board of Directors and Advisors • Owe you favors Marshalling Resources
0 Personal Resources • Staying power • Your personal resources • Borrowing capacity • Spouse who works • Culture that you create • Personal characteristics • You are likeable • Integrity Marshalling Resources
0 What is Bootstrapping? • “Launching ventures with modest personal funds”, Bhide • Other People’s Resources (OPR), “Key is not to own resources, but to have use of & be able to control or influence deployment”, Timmons • Scrooge mode Attitude Marshalling Resources
0 Bootstrapping Examples • Make vs. buy • Volume purchasing • Hiring employees vs. subcontract or temps • Employee benefits • Office and location • Used equipment • PR vs. advertising & promotion • Strategic alliances - Jurismonitor • Grants Marshalling Resources
0 Benefits of Bootstrapping - Enhances Funding • Need less capital • Reduces financial exposure • Reduces amount of money need to raise - less dilution • Reduces risk • Obsolescence • Lower sunk costs • Investor's love it • Proves concept and management team • Reduces risk Marshalling Resources
0 Benefits of Bootstrapping - Provides Flexibility • Permits strategic experiments • Make changes quickly • Cost of making a mistake is minimized • Mistakes less likely to be fatal • Inexperienced entrepreneurs can screw-up • Don’t have the pressure of high growth Marshalling Resources
0 Benefits of Bootstrapping - Improves Problem Solving • Like zero inventory in JIT • Reveals hidden problems • Forces management to solve them • Focus is on profits • Forces management to solve problems • Price for profitability • Reduces costs • Lower fixed costs • Higher variable costs, but high Gross Profit Margin solves • Lower break-even point Marshalling Resources
0 Benefits of Bootstrapping - Sets the Right Culture • Employees • Suppliers Marshalling Resources
0 Can An Entrepreneur Have Too Much Money? • Don’t focus or address real issues • Throw money at it • Dot.bombs • Try-it, fix-it approach is difficult • “Are we being fooled twice” • Try to compete on price – buy market share • Don’t focus on achieving high margins Marshalling Resources
0 What Is the Greatest Source of Cash? Don't Spend It Marshalling Resources
0 Marshaling Resources Conclusion • Control rather than own - OPR • Money is not the solution. May be the problem. • Bootstrapping is an attitude • What is a downside of focusing on resources? Not Opportunity Driven Marshalling Resources