Chapter 2

family business

- firm in which one family owns a majority stake and is involved in the daily management of the business

resource competencies

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

key business functions

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

role conflict

-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

discrimination in financing

-minority applicants were denied at twice the rate of white -asian and hispanic owners pay higher interest rates on their loan

five p's of entrepreneurial behavior

-passion -perseverance -promotion/prevention focus -planning style -professionalization

displays of passion

1. by looking at challenges of the business in a creative way 2. by being persistently focused on the business 3. by being absorbed by the tasks and concerns of the business

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

perseverance

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

industry-specific knowledge

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

standard business practice

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

promotion focus

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

prevention focus

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

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

certification

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

competencies

forms of business-related expertise

set asides

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

passion

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

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

cognition

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

succession

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

expert business professionalization

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

minimalized business professionalization

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

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

basic business competency

understanding the organizational business processes of a firm

action

visible behavior a person takes