Deck 7: Developing an Effective Business Plan and Strategic Entrepreneurial Growth

Question 1

Both high-performing and low-performing small ventures have problems with

A)long-range planning.
B)a poor planning climate.
C)unfavorable economic conditions.
D)both a and c.

Answer 1

long-range planning.

Question 2

Identify the key dimensions influencing a firm's strategic planning activities.

Answer 2

There are five factors that shape the strategic management activities of growing companies. These factors are: demand on strategic manager's time; speed of decision making; problems of internal politics; environmental uncertainty; the entrepreneur's vision.

Question 3

Describe the value of strategic planning as evidenced by research studies.

Answer 3

All of the current research indicates that firms that engage in strategic planning are more effective than those that do not. In one study of 357 Texas ventures there was evidence of less failure in the firms that did planning over a two-year period (Sexton and Van Auken, 1985). Another study of 9,000 firms established the lack of planning as a major cause of failure (Dun & Bradstreet, 1987). Finally, the Bracker & Pearson study in 1988 demonstrated that small firms using structured strategic planning outperformed all other firms in the study.

Question 4

Identify the approaches that can be used to implement a strategic plan.

Question 5

The emphasis of the business plan should never be the final implementation of the venture.

Question 6

Which of the following is a pitfall to avoid in planning?

A)lack of priorities
B)lack of profit
C)no admission of possible success in the plan
D)refusal to write items down

Question 7

What is one possible way to avoid the pitfall of no market niche (segment)?

A)conduct a market analysis
B)check market niches in marketing journals to determine which one the venture falls into
C)clearly specify which market niche the venture plans to target
D)create a new one

Question 8

The final copy of the business plan should be

A)paper clipped so that the financial sources can easily look through it.
B)put in a plastic folder.
C)professionally bound and typeset.
D)none of the above.

Question 9

Which of the following ratios are analyzed using a pro forma balance sheet?

A)sales to revenue
B)inventory turnover
C)stockholders' equity to owners' equity
D)R & D costs

Question 10

Which of the following is suggested for helping in the oral presentation of a business plan?

A)the use of mnemonic devices
B)the use of 3"* 5" index cards
C)rote memorization
D)utilization of key words on an outline