SBM 1

Standard business practice

A business action that has been widely adopted within an industry or occupation

Independent small businesses

A business owned by an individual or small group

Owner-managed firms

A business run by the individual who owns it

Traditional small business

A firm intended to provide a living income to the owner, and operating in a manner and on a schedule consistent with other firms in the industry and market

High-performing small business

A firm intended to provide the owner with a high income through sales or profits superior to those of the traditional small business

High-growth venture

A firm started with the intent of eventually going public, following the pattern of growth and operations of a big business

Perceptual map

A graphic display which positions products, services, brands, or companies according to their scores of important strategic dimensions

Decline stage

A life cycle stage in which sales and profits of the firm begin a falling trend

Innovation-driven economy

A nation there the major forces for jobs, revenues, and taxes come from high-value added production based on new ideas and technologies and from professional services based on higher education

Efficiency-driven economy

A nation where industrialization is becoming the major force providing jobs, revenues, and taxes, and where minimizing costs while maximizing productivity (i.e. efficiency) is a major goal

Factor-driven economy

A nation where the major forces for jobs, revenues, and taxes come from farming or extractive industries like forestry, mining, or oil production

Heir

A person who becomes an owner through inheriting or being given a stake in a family business

Self-efficacy

A person's belief in his or her ability to achieve a goal

Cognition

A person's way of perceiving and thinking about his or her experience

Main street businesses

A popular term for small businesses reflecting the idea that these are the kinds of firms you would expect to find on the main street of a typical American city, and are the opposite of big businesses or "Wall Street" businesses

Franchise

A prepackaged business bought, rented, or leased from a company called a franchiser

Expert business professionalization

A situation that occurs when all the major functions of a firm are conducted according to the standard business practices of its industry

Specialized business professionalization

A situation that occurs when businesses have founders or owners who are passionate about one or two of the key business functions, such as sales, operations, accounting, finance, or human resources

Minimalized business professionalization

A situation that occurs when the entrepreneur does nearly everything in the simplest way possible

Lifestyle or part-time firm

A small business primarily intended to provide partial or subsistence financial support for the existing lifestyle of the owner, most often through operations that fit the owner's schedule and way of working

Boom

A type of life cycle growth stage marked by a very rapid increase in sales in a relatively short time

Shake-out

A type of life cycle stage following a boom in which there is a rapid decrease in the number of firms in an industry

Effectuation

An approach used to create alternatives in uncertain environments

Promotion focus

An entrepreneur's attention to maximizing gains and pursuing opportunities likely to lead to gains

Prevention focus

An entrepreneur's attention to minimizing losses, with a bias toward inaction or protective action to prevent loss

Parallel competition

An imitative business that competes locally with others in the same industry

Growth stage

An industry life cycle stage in which customer purchases increase at a dramatic rate.

Passion

An intense positive feeling an entrepreneur has toward the business or the idea behind the business

Firm

An organization that sells to or trades with others

Incremental innovation

An overall strategic approach in which a firm patterns itself on other firms, with the exception of one or two key areas

Innovative strategy

An overall strategic approach in which a firm seeks to do something that is very different from what others in the industry are doing

Imitative strategy

An overall strategic approach in which the entrepreneur does more or less what others are already doing

Industry dynamics

Changes in competitors, sales and profits in an industry over time

Novelty

Characterized by being different or new

Imitative

Characterized by being like or copying something that already exists

Necessity-driven entrepreneurship

Creating a firm as an alternative to unemployment

Opportunity-driven entrepreneurship

Creating a firm to improve one's income or a product or service

Comprehensive planners

Entrepreneurs who develop long-range plans for all aspects of the business

Critical-point planners

Entrepreneurs who develop plans focused on the most important aspect of the business first

Habit-driven planners

Entrepreneurs who do not plan, preferring to let all actions be dictated by their routines

Opportunistic planners

Entrepreneurs who start with a goal instead of a plan and look for opportunities to achieve it

Reactive planners

Entrepreneurs with a passive approach, who wait for cues from the environment to determine what actions to take

Crowdfunding

Funding a business online through the collective involvement of others who provide donations, loans, or investments

Set asides

Government contracting funds which are earmarked for particular kinds of firms, such as small businesses, minority-owned firms, and women-owned firms

Discrimination in financing

Minority applicants were denied at twice the rate of whites. Asian and Hispanic owners pay higher interest rates on their loans

Overall growth strategy

One of four general ways to position a business based on the rate and level of growth entrepreneurs anticipate for their firm

Founders

People who create or start new businesses

Serial entrepreneurs

People who open multiple businesses throughout their career

Buyers

People who purchase an existing business

Crowdsourcing

Techniques often based on Internet-based services to get opinions or ideas through the collective involvement of others

Degree of similarity

The extent to which a product or service is like another

Industry

The general name for the line of product or service being sold, or the firms in that line of business Key is selecting an industry that offers good potential for making a profit Also needs to offer attractive opportunities to work with a minimum of risk and competition

Small and medium enterprise

The international term for small businesses

Introduction stage

The life cycle stage in which the product or service is being invented and initially developed.

Magic number

The post-tax income the entrepreneur personally seeks from the business

Pure innovation (blue ocean strategy)

The process of creating new products or services, which results in a previously unseen product or service. Also called blue ocean strategy

Goods or services

The tangible things (goods) or intangible commodities (services) created for sale.

Maturity stage

The third life cycle stage, marked by a stabilization of demand, with firms in the industry moving to stabilize or improve profits through cost strategies

Action

The visible behavior a person takes

Creative destruction

The way that newly created goods, services, or firms can hurt existing goods, services, or firms

Bootstrapping

Using low-cost or free techniques to minimize your cost of doing business

Self-employed

Working for yourself

Family business

a firm in which one family owns a majority stake and is involved in the daily management of the business 1/3 of the Standard & Poor's 500 are family owned and managed

Small Business Administration

a part of U.S. government which provides support and advocacy for small business

Entrepreneur

a person who owns or starts an organization, such as a business

Flexibility rewards

ability of business owners to structure life in the way that suits their needs

Key business functions

activities common to all businesses sales, operations, accounting, finance, and human resources

Industry-specific knowledge

activities, skills, and knowledge, specific to businesses in an industry

Competitor

all the firms also selling that product or service

Certification

an examination base acknowledgement that the firm is owned and operated as specified

Market

business term for the population of customers for your product or service

Benefits

characteristics of a product or service that the target customer would consider worthwhile value benefit, cost benefit

Mindshare

degree of attention to which your target market pays to your idea or organization

Innovation

focus which looks at a new thing or a new way of doing things

Creation

focus which looks at the making of new entities

Customer-focus

focus which refers to being in tune with one's market

Efficiency

focus which refers to doing the most work with the fewest resources

Independent entrepreneurship

form of entrepreneurship in which a person or group own their own for-profit business

Social entrepreneurship

form of entrepreneurship involving the creation of self-sustaining charitable and civic organizations, or for-profit organizations which invest significant profits in charitable activities

Corporate entrepreneurship

form of entrepreneurship which takes place in existing businesses around new products, services or markets

Competencies

forms of business-related expertise

Scope

geographic range covered by the market Local to Global Knowing your market scope helps deciding where to focus sales and advertising efforts Knowing your target market gives you a way to know which competitors to worry about most, namely those within your market scope

Small Business

involves 1-50 people and has its owner managing the business on a day-to-day basis

Mass market

large portions of the population

Income rewards

money made by owning one's own business

Niche market

narrowly defined segment of the population that is likely to share interests or concerns

Time management

organizing process to help make the most efficient use of the day

Late career entrepreneurs

people who begin their businesses after having retired or resigned from work in corporations at age 50 or older

Virtual Instant Global Entrepreneurship (VIGE)

process that uses the Internet to quickly create businesses with a worldwide reach. Depends on using websites like eBay or eLance to quickly establish a global presence

Innovativeness

refers to how important a role new ideas, products, services, processes, or markets play in an organization

Scale

size of the market

Determination competencies

skills identified with the energy and focus needed to bring a business into existence

Opportunity competencies

skills necessary to identify and exploit elements of the business environment that can lead to a profitable and sustainable business

Resource competencies

the ability or skill of the entrepreneur at finding expendable components necessary to the operation of the business Time, information, location, financing, raw materials, expertise

Perseverance

the ability to stick with some activity even when it takes a long time, and when a successful or unsuccessful outcome is not immediately known learned optimism

Strategy

the ideas and actions that explain how a firm will make its profit

Role conflict

the kind of problem that arises when people have multiple responsibilities, such as parent and boss, and the different responsibilities make different demands on them Whenever possible, make decisions based on business necessities.

Succession

the process of intergenerational transfer of a business Lack of clear transition plan is the death knell

Basic business competency

understanding the organizational and business processes of a firm

Growth rewards

what people get from facing and beating challenges