Entrepreneurship Notes

Stakeholders are people (individuals or group) who have an interest in a company’s or organization’s affairs. These are people who can affect or are affected by the achievement of the organizational objectives. E.g. customers, suppliers, investors etc. Involvement of stakeholders can reduce uncertainty and improve decision making by understanding their experiences, desires, constraints etc. When there is higher uncertainty, there is increased value of involving stakeholders in decision making. Select stakeholders: That are representative Have more power With legitimacy With urgency Methods to hear the voice of stakeholders: Interview: experts in the field, prospective customers, prospective investors Discussion with focused groups Surveys This blog post is based on my learnings from the course on ‘entrepreneurship’ offered by Maryland Technology Enterprise Institute, University of Maryland through Coursera (2014).

Strategic entrepreneurial decisions are inherently risky as entrepreneurs rarely know all possible outcomes. If information on the consequences of decisions is incomplete, uncertainty involves risk. Perception of risk may differ. Risk is conceptualized based on individual entrepreneur’s assessment of risk and uncertainty in a decision. Perceived uncertainty and perceived risk along with industry dynamism drives the entrepreneurial decision making process. Why do entrepreneurs engage in risk? Because of lack of necessary information in a decision situation Entrepreneurs develop an inside view of the decisions they face Ignore elements of past situations Favour positive possible outcomes Entrepreneurs differ from corporate managers based on decision making factors like: Intuition Individualistic view High tolerance for ambiguity Confidence in skills, knowledge and expertise To assess real risk and improve decision making: Apply multiple perspectives to a decision situation Integrate per...

Cognition involves individual decision making involving the selection of specific course of action that is supposed to bring a certain result. Decision making implies choice. Environment of entrepreneurs is uniquely challenging and strategic decision includes complexity, uncertainty, rationality and control. Strategic decisions typically share the same process: 1. Recognizing a problem situation: know problem very well, understand it 2. Generating alternatives, different solutions to problem situation 3. Evaluating the various alternatives 4. Selecting the alternative that best satisfies our evaluating criteria Decisions of entrepreneurs differ from company managers as entrepreneurs: 1. Operate with limited information 2. Must be action oriented and decisive 3. Accept risk (don’t wait too long to take action, you don’t have infinite time for analysis) 4. Involve major consequences: be ready to face the consequences – be it bad or good This blog post is based on my learnings from the co...