Entrepreneurship Jerry Musnitsky. The World of Business 50’s & 60’s - Engineering –Build it in my garage and I am successful Engineers as CEO’s 70’s &

Entrepreneurship

Jerry Musnitsky

The World of Business

• 50’s & 60’s - Engineering– Build it in my garage and I am successful

• Engineers as CEO’s

• 70’s & 80’s - Marketing– Don’t care if it works or not, I can create a market

influence demand, advertise it and sell it.• Marketeers as CEO

• 90’s - Finance– Don’t care what you make, leverage, borrow and invest

in junk bonds for a bigger return.• Financiers as CEO

The World of Strategy

• Today– Do Everything Right

• And it still won’t work

• The User will Decide– No one has decision power– Everyone has veto power

• Information has Value• Service has a Price• Cover the World at Once!

Misunderstood Terms

• Operational Effectiveness – Total Quality Management (TQM)– Just-in-Time– Reengineering– Better, Faster, Cheaper

• Objective - Chase the Money

Better Definitions• Strategy

– The Quality of Management - TQM?– The Right Time and Place (Position) - Basketball– Systems Engineering (Integration)

• Technology - using it or creating Intellectual Property

– Different• Don’t count on the incompetence of your competitor• Win contracts as high bidder!

• Don’t Chase the Money– Follow the Money in the Marketplace – Do the Right Thing and the Money will Come

The Role of Strategy

• Success is Predetermined• Only Strategy creates Sustainable Advantage

– Regardless of the technology or the pace of change

• Must have the Right Goal– Must have a different Value Proposition

– Must be Unique

– Must make Choices

• Must be focused on Profitability

Who’s Strategy

• Chief Strategist is the CEO– Must Take Risks

• The definition of an Entrepreneur is One Who Takes Risk!

– Must Make Decisions• A bad decision is better than no decision

– Must be Schizophrenic (Flexibility)• Ability to switch from Search to Track• Ability to use Multi-Mode

– Keep the Goal and it will work• Must do everything right

• Though only a few things get done right

– Must be an Excellent Teacher• Everyone must understand the Strategy

– Marketing must sell it to the customers

– Engineers must design towards it

– The Inside sell is Harder than the Outside Sell

– I spend most of my time translating English to English

• Business is Transparent and there are no secrets– Baseball versus [American] Football

What is Strategy?

• Identify a market, use your talents and capabilities, establish a plan that competitors are not implementing and cannot duplicate to create a Competitive Advantage that results in above average returns!

• Exit

What you need

• Market– Business Development

• Marketing, Politics, People

• Product/Service– Technology

• Intellectual Property, Application, People

• Organization• Finance, Operations, People

Measurement Tools• Market size (market cap)• Funding availability

– Need versus Desire• We need [better] public education, but won’t fund it.• We need to improve our environment, but no desire.

• Request for Proposal– Based on Specifications – Influence the Specification = Competitive advantage

• Win a Contract• Profitable operations

– You are what you win

• Increase corporate value

Types of Businesses

• The Hobby• The Pump & Dump• The Smoke & Mirrors• The Real Thing

• Lifestyle Firm – supports the owners & does not

grow

• Foundation Company– Based on research &

development and does not grow

• Gazelles– Very high growth potential

• High-growth potential– Attracts investors

• Government• Blue Chips

Four Groups Anyone Can Belong

Business Ventures

• WiMax• Transportation• Business-to-Business• Technology• Software• Environment• Medical• Old Age• Bagels in Paris• Managing queues in France

• Service

• New Division– Intrapreneur

• Security

• Government– Mail

– Voting

– Services

– Federal

– State/local