Wednesday, March 26 Agenda

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Wednesday, March 26 - Agenda

• Announcements
• Machine/Diversified configurations - recap
• Entrepreneurial configuration
• Case 4 TV Asahi Theatrical Productions
• Team project preparations

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Focus Group MBA Program
Next class period, 600-640 Optional YOUR
INPUT IS STRONGLY DESIRED
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Strategy at NDSU . . .

• Some attributes of
• the machine
• configuration?

• Some attributes of a
• diversified
• configuration?

4
Value of understanding elements of configurations
. .

• The working parts of the organization.
• Which parts are key for your type of
  organization? Why?
• How do those parts work?
• How do we effectively work with those parts?
• How is strategy created? No one best way!
• What are the strengths, challenges, and pitfalls
  of each of the configurations?
• Useful to adapt our expectations and managerial
  approach within each context.

5
The Entrepreneurial Organization (R13.1)

• Basic structural attributes
• Key part
• Other basic parts are quite undeveloped, except
  operating core
• Simple, flat structure
• Primary coordinating mechanism
• High level of centralization
• Low levels of specialization, formalization

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Entrepreneurial Organizations
Significance/Advantages
Disadvantages
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Consider strategy-making in entrepreneurialorgani
zations,

• vs. machine configuration -
• strategy-making as an oxymoron?
• classic top-down approach
• involvement of planning specialists
• lagged change

• vs. diversified configuration -
• key role for division managers, so
• some decentralization and variation, but
• constrained by HQ priorities and
• standardized financial output criteria

8
Visionary Leadershipin entrepreneurial firms

• REPETITION - use of experience, intimate
  knowledge informed intuition
• REPRESENTATION - articulates and/or models the
  vision, may be evangelical
• ASSISTANCE - motivates, empowers, uses charisma
• INTEGRITY - genuineness, leads to inspiration

9
Strategic change in entrepreneurial organizations

• CONTROLLED BOLDNESS - simultaneous
  formulation/implementation in early strategy
  development stages
• INFREQUENT BOLDNESS - unfreezing/changing/refree
  zing
• FOLLOWED BY OBSESSION

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Mintzbergs thoughts . . .

• The conception of a new strategy is an
• exercise in synthesis, which is typically best
• carried out in a single, informed brain.
• The entrepreneurial approach is at the center of
  the most glorious corporate successes.
• environment
  organization

leadership
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Beware of . . .

• assuming that all management prescriptions are
  appropriate for entrepreneurial firms (which far
  outnumber large firms).
• eroding key advantages (low administrative
  overhead, innovation, new visions, rapid
  response, task variety, more personalized work
  environment, organizational commitment, strong
  culture, strategic intent) of the entrepreneurial
  firm with trappings of the machine.

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Contexts for the entrepreneurial form

13
Porter Competitive Strategy in Emerging
Industries (R13.2)

• Distinguishing characteristics of emerging
  industries examples . . .

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First movers . . .

• Advantages?

• Disadvantages?

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Key strategic issues in emerging industries

• entry timing
• market selection, positioning
• commercialization skills
• strategic alliances
• prudent resource use
• vigilant adaptation
• shaping industry structure
• creating entry barriers

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Fragmented industries

• Distinguishing characteristics?
• Examples?
• Key strategic issues?

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Bhide How Entrepreneurs Craft Strategies that
Work (R13.3)

• 1. Quickly screen out unpromising ideas
• -use judgement (rather than exhaustive data
• search)
• -focus on a creative idea or superior execution
• -consider venture objectives and competition
• -leverage external change

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• 2. Gauge attractiveness
• -low capital requirements
• -cash flow funding
• -avoid equity dilution
• -one project at a time!
• -evaluate size of/cost to serve the niche
• -evaluate reliance on intermediaries
• -consider less visible niches
• -keep operations simple if possible
• -need a high margin for error
• -easy exit businesses are desirable

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• 3. Need parsimonious planning and analysis
• 4. Integrate action and analysis
• -handle analytical tasks in stages
• -plug holes quickly
• -practice evangelical investigation
• -demonstrate smart arrogance

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Conclusion?

• Entrepreneurial strategies evolve
• through a seamless process of
• guesswork, analysis, and action.
• and . . .??