Deck 4: Managing Entrepreneurially

Question 1

Henrik wanted to launch a new business focusing on custom hockey stick manufacturing-allowing semi-pro hockey players access to similar custom technology that NHL players receive. His potential financial backers kept pushing him to clarify the cost-benefit to his customers since it meant charging 15 percent to 20 percent more for an off-the-shelf hockey stick. They wanted to know his value proposition.

Answer 1

True

Question 2

Pursuing opportunities is at the heart of entrepreneurship.

Answer 2

True

Question 3

All organizations started small, and as they grew, the original founders were always at the helm and maintained control throughout the life of the business.

Answer 3

False

Question 4

In evaluating an idea for an entrepreneurial opportunity, a commonly used, structured approach called a feasibility study analyzes the various aspects of a proposed venture.

Question 5

Large global businesses are at the forefront of job creation as small enterprises downsize their workforces.

Question 6

To be an entrepreneurial venture, a small business must also be innovative and constantly seeking out new opportunities.

Question 7

There are essentially two descriptions of how entrepreneurs add value to the economy: creative destruction and by being entrepreneurially alert. They are essentially the same thing.

Question 8

An analysis of the benefits, costs, and value that an organization can deliver to its customers is commonly known as a value proposition.

Question 9

The feasibility study and business plan are key parts of the value proposition.

Question 10

According to one study, nearly two-thirds of respondents said that working in the same industry was the major source of ideas for a new venture.

Question 11

Customer creation is the first step in the model for company building.

Question 12

By definition, a small business is necessarily entrepreneurial.

Question 13

Entrepreneurship is the process of starting a new business or organization in response to perceived opportunities.

Question 14

The business plan is a written document that defines and articulates how the particular opportunity will be developed and exploited.

Question 15

Social responsibility and ethics do not play an important role in an entrepreneurial startup.

Question 16

Janice is the new CEO of a small Internet security company and is working with the founder to grow the business. Janice is the classic idea of an entrepreneur.

Question 17

Lily's feasibility study for her new web design company was loaded with extra details that most entrepreneurs don't seem to bother with. She was proud of the fact that it included a lot of supporting information that made the final document really thick-sure to impress her backers. This was an example of a good approach to doing a feasibility study.

Question 18

Businesses that are started in response to needs within a community are known as social enterprises/ventures and may be not-for-profit entities.

Question 19

Failure is a clear indication that one is not suited to entrepreneurial career.

Question 20

The first step in the entrepreneurial process is to explore economic, legal, political and social environments.

Question 21

One study showed that visionary companies financially outperformed nonvisionary ones six times over.

Question 22

Typically, entrepreneurs are looking to hire individuals who are both high-potential people who can perform multiple roles during the different stages of business growth, as well as those who connect well with the venture's culture.

Question 23

Research directed toward acquiring new knowledge rather than toward a practical objective is known as curiosity-driven research.

Question 24

Phil's new online dating company is growing faster than he anticipated. Just six weeks since launching, he is panicking because he is no longer capable of handling the increasing demands of his growing enterprise. Clearly, the first thing Phil should do is hire an operations manager to decide on what the organization structure should look like.

Question 25

Growing quickly can kill a venture if the related stresses caused by growth are not managed properly.

Question 26

The blueprint or road map for an entrepreneurial venture is the business plan.

Question 27

The ability of the entrepreneur to articulate a coherent and inspiring vision of the future is, in practice, not a very important part of his or her leadership. If recruiting is done well, the employees will begin to see the future of the organization on their own.

Question 28

The three key control issues facing entrepreneurs are managing growth effectively, navigating downturns, and ensuring they maintain a fixed vacation schedule to sustain them through the stresses.

Question 29

As a successful entrepreneur realizes that they cannot do everything by themselves, they must decide on an appropriate organizational structure if they want to continue to effectively carry out the activities of the venture.

Question 30

Lisa has discovered an opportunity in her own industry: landscaping. She wants to get the business started right away. It would be wise for her to skip the detailed planning process and dive in so that opportunity does not pass her by.

Question 31

Recruitment and retention are the two main human resource challenges entrepreneurs start to face as their ventures grow. It is insufficient to simply look at getting the right people into the business without considering how to keep them in the long run.

Question 32

For many entrepreneurs, one of the challenges of their growing enterprise is having to share decision-making and operating responsibilities with those hired to support the enterprise.

Question 33

One final part of completing a feasibility study is uncovering potential sources of financing.

Question 34

Being a change agent and supporting innovation together represent the single most important function of an entrepreneur in the early years of the venture.

Question 35

It is not vital that an entrepreneur develop a business plan when planning a venture.

Question 36

Curiosity-driven research and applied research are essentially the same thing: both generate new knowledge that can be used in some practical or commercially driven way.

Question 37

Sarah has been working hard on her business plan for her new web marketing business for the past eight weeks. She feels she has nailed down every conceivable detail of the business for the next four years. When discussing it with her financial partner, the question of a contingency plan came up. Sarah became frustrated and asked, "Why would I need a contingency plan?" In answering, her partner said that a contingency plan was important because it was a more concise version of her full business plan, which she could use to show potential clients where her company was going and what she stood for. Sarah's partner is correct about her understanding of a contingency plan.

Question 38

Of the many hats an entrepreneur wears, being a change agent is the least important. This is because during the first two years of the venture, operational excellence rules and little should change in the enterprise during this time.

Question 39

The main human resource challenge an entrepreneur faces is recruiting, ensuring they find the right people and bring them into the venture. After that, things start to take care of themselves.

Question 40

In organizing a business venture, the entrepreneur must address four main issues: organizational design and structure, human resource management, how to stimulate and make changes, and the continuing importance of innovation.

Question 41

Aside from innovation the importance of entrepreneurship can be shown in three areas: _________________, _______________, and ____________.

A) job creation, new HR policies, increased hiring
B) job creation, new product development, more economic activity
C) global entrepreneurship, applied research, social responsibility
D) social responsibility, number of new startups, job creation
E) number of new startups, job creation, global entrepreneurship

Question 42

All organizations have had a starting point and, if successful in the long term, experienced one key thing in common: each venture has had to ________________.

A) go through the transition from original founder(s) to next generation of professional management
B) execute their contingency plan to stave off potential financial ruin
C) fire the founder(s) to allow for a clean restructuring of the organization
D) defend themselves against lawsuits for poor retention strategies
E) go public through the sale of all or part of the venture on the stock market

Question 43

Which of the following is not one of the seven questions to ask when identifying a new opportunity?

A) What is your idea?
B) Who will it matter to?
C) Where will you do it?
D) How will you pull off your "What"?
E) Why will this be attractive to investors?

Question 44

The entrepreneurial process starts with ____________ .

A) Starting the venture
B) Identifying customers
C) Developing the product/service
D) Exploring the entrepreneurial context
E) Applied research

Question 45

In exploring the context of a potential venture, the entrepreneur generally does three things: _____________, ______________, and _______________.

A) explores financing options, gathers information, uncovers business ideas
B) asks their family for financial support, looks at competitors, pinpoints possible competitive advantage
C) researches the venture's feasibility, scouts locations, gathers information
D) gathers information, identifies potential opportunities, pinpoints possible competitive advantages
E) uncovers business ideas, looks at competitors, examines financing options

Question 46

The final step in the entrepreneurial process is _______________.

A) identifying the customers
B) preparing a marketing plan
C) managing the venture
D) choosing a leader
E) conducting research

Question 47

Max wants to be an entrepreneur but in today's climate it is difficult to come up with a totally new idea and build a business around it. Max is scanning the environment as well as actively searching for an opportunity. He knows there is one just waiting for him, but how to find it is his challenge. He would most like to come up with something completely new where neither the supply for the demand is known. Max is involved in the process of __________________.

A) recognizing an opportunity
B) enacting an opportunity
C) discovering an opportunity
D) curiosity-driven research
E) conducting a feasibility study

Question 48

Conventional entrepreneurship models start with the business plan. The Timmons model looks at the entrepreneurship process a bit differently. It starts with a market opportunity and _______________________.

A) the ability of the founder to access financial resources quickly
B) the capacity of the founder to see the future more coherently than their nearest competitor
C) the capacity of the founder's network to provide an infrastructure to the new venture
D) the ability of the founder to find the right people for specific roles quickly
E) the capacity of the founder to distinguish between an idea and an opportunity

Question 49

By definition, a start-up is _________________ designed to search for a repeatable and scalable business model.

A) an established business
B) a business in temporary quarters
C) an idea in the mind of the founder
D) a temporary organization
E) a business model

Question 50

Organizations that are started in response to needs within the community are known as ___________________.

A) communal cooperatives
B) public ventures
C) social enterprises
D) social networks
E) communal corporations

Question 51

The steps in the model for company building include all of the following except ____________.

A) customer validation
B) customer creation
C) company building
D) customer discovery
E) company growth

Question 52

For the past two months, Ian has been looking at the potential of a new compact solar capture technology he has developed, which would make it economically feasible for condominium owners to harness the sun on their balconies and use the generated electricity to offset the power purchased from their local electricity provider. If the business takes off, it would revolutionize the relationship between power authorities and their customers-where both sides would be power generators and clients. This process is known as ________________.

A) creative social-preneurship
B) social justice-preneurship
C) creative balancing
D) revolutionary justice
E) creative destruction

Question 53

Lisa has been hired by Lexman Corporation, a large mutlinational hydro-electric engineering firm, to launch a brand-new business under a different name. Funding will come from Lexman, but they want to take a hands-off approach and let Lisa run it as if it were her own business. The enterprise will market small, low-cost solar generators that individual homeowners can purchase and then easily relocate to a new home if they move. Executives at Lexman have told Lisa that the main objective in the first three years is growth and market penetration and then more of a focus on profit in year 4 and beyond. This is definitely a(n) __________.

A) protective investment
B) entrepreneurial misadventure
C) entrepreneurial venture
D) social venture
E) social investment

Question 54

In the process of transformation that must happen from following through with a radical innovation and taking advantage of it, the venture goes through a process called _____________.

A) feasibility assessment
B) applied research
C) idea generation
D) creative destruction
E) business planning

Question 55

An organization that is independently owned, operated, and financed; has fewer than 100 employees; and does not necessarily engage in any new or innovative practices is known as a(n) ________________.

A) small business
B) entrepreneurial venture
C) small holding company
D) subsidiary
E) "mom and pop" operation

Question 56

Entrepreneurship is ________________.

A) the process of starting a brand-new enterprise with four employees or less
B) the process of starting a new organization, generally in response to an opportunity
C) the process of taking an organization or venture private and away from the public domain
D) the development of an idea into a feasibility and subsequent business plan up to but not surpassing the actual start of the venture's operations
E) becoming less and less significant to the Canadian economy as most jobs now are created by large companies

Question 57

Imagine you are the entrepreneur behind a new wellness and yoga centre. Business planning has taken you about five months to complete. After that came the location development, construction of the wellness centre, and launching of the business. You are now in week 4 of the centre's operation and you are feeling a little tired from the seven-day weeks that have led up to this point. Thankfully you are noticing that revenues are about 15 percent above your most realistic projections. With a total staff of 17 (4 support staff and 13 wellness professionals and yoga teachers), you are realizing that a big part of your time is spent looking after people management issues. Which of the following is not a concern directly related to managing people?

A) motivating
B) training
C) selecting and hiring
D) managing conflict
E) marketing

Question 58

Ingrid has been working as a brand manager for a large multinational consumer goods company for the past 12 years. She is starting to get tired of working for someone else and wants to start her own company. Right now her job is giving her the opportunity to scan the industries her company is involved in and look for opportunities in areas her company cannot address quickly or is not interested in pursuing. She is being ______________.

A) entrepreneurially devious
B) capitalistically clever
C) ethically dubious
D) entrepreneurially alert
E) capitalistically perceptive

Question 59

In a fear-of-failure culture managers are hesitant to try new things in case they might fail leading to a stagnant organization. Alternatively, start-ups need ____________ culture that will enable the adaptive capacity of an organization.

A) customer focused
B) strategic plan focused
C) curiosity-driven
D) learning-and-discovery
E) entrepreneurial

Question 60

In a study it was discovered that the biggest source of ideas for entrepreneurial ventures is ______________.

A) movies and television
B) friends' suggestions
C) personal hobbies
D) working in the same industry
E) other familiar products

Question 61

Which of the following is NOT an organizing issue for an entrepreneur when creating a new venture?

A) organization design and structure
B) human resource management
C) how to encourage and make changes
D) sales management
E) encouraging innovation

Question 62

In evaluating an idea for an entrepreneurial venture you need to examine the marketplace considerations as well as the ______________ considerations in order to obtain a balanced view.

A) personal
B) financing
C) ethnocentric
D) demographic
E) neoconservative

Question 63

When entrepreneurs start to bring on employees for their young ventures, they typically look for all of the following types of employees except _______________.

A) high potentials who can perform multiple roles
B) those who buy into the entrepreneurial culture
C) people who have a passion for the business
D) high potentials who are looking for long-term advancement opportunities
E) those who are self-motivated and multi-skilled

Question 64

Shelley is very excited about launching her new business-providing customized and personalized umbrellas. Her business will be completely online, and she is convinced she has thought everything through. The last step is getting investors interested in her venture, but they do not seem to be as excited as she is. When they ask her what the business is about, she can speak about it, but her documentation is confusing. She is concerned that she will never find the necessary investment or financing to get the business off the ground. What is the first thing you would recommend Shelley do?

A) Forget about investors and talk to one of the chartered banks.
B) Ask family and friends to invest.
C) Take out a mortgage on her house to finance her venture.
D) Write a business plan.
E) Take a vacation.

Question 65

In many small firms the organizational structure tends to evolve _________.

A) naturally, without much stress
B) with very little intentional and deliberate planning
C) with the hiring of a family member or close friend
D) naturally and easily with the occasional poor hire
E) like molasses, slowly, with great resistance from the entrepreneur until they burn out and the business teeters on the edge of bankruptcy

Question 66

There are several reasons entrepreneurs resist implementing a more deliberate organization structure. Which of the following is not one of the reasons?

A) fear of sharing decision-making
B) fear of sharing operational responsibilities
C) fear of implementing a structure that is too rigid for their personality and business
D) fear that the business will fail because they are not as committed as the entrepreneur is
E) fear that their competitors will keep their structures smaller and have less overhead costs

Question 67

As the entrepreneurial venture grows and the entrepreneur finds it increasingly difficult to go it alone, the next step is usually to _______________.

A) prepare a new business plan
B) sell the business
C) expand the business
D) hire a therapist to help the entrepreneur deal with the stresses and strains of the business
E) hire employees to perform certain functions the entrepreneur can no longer handle

Question 68

When hiring, entrepreneurial leaders are primarily concerned with matching the _______________ of the potential employee to the ______________ the organization.

A) skills; work demands of
B) skills; values and culture of
C) characteristics; work demands within
D) values; specific job within
E) characteristics; values and culture of

Question 69

Before preparing a business plan it is important to examine the viability of a proposed venture idea. To do this it is good practice to complete a _______________.

A) strategic plan
B) feasibility study
C) economic impact study
D) demographic study
E) marketing strategy

Question 70

Three months after launching your bike shop, business is stabilizing at a level a bit higher than you anticipated. This is good for the bottom line but is creating stress due to the extra hours you have been working to ensure the business runs properly. It is clear you need people to help you. The first thing you need to do is _____________.

A) hire a store manager
B) hire more employees in the places you need them most
C) clarify the structural arrangement you need for your business
D) start thinking about expansion
E) tighten up your financial controls

Question 71

Two key elements of a feasibility study are assessing competitors and researching _____________.

A) availability of labour
B) tax implications
C) legality of the venture
D) export logistics
E) financing

Question 72

A business plan ________________________.

A) guides organizational decisions
B) ensures financial backing
C) provides guidelines for hiring practices
D) is the blueprint for innovation and creativity
E) provides guidelines for global expansion

Question 73

At the heart of every successful entrepreneurial venture is the articulation of a strong and distinctive ____________________, an analysis of the benefits, costs, and other value to the target customer and other groups within and outside of the organization.

A) focus group
B) triple bottom-line analysis
C) value proposition
D) market valuation
E) equity assessment

Question 74

Along with organization design and structure, human resource management becomes more important as employees are brought in. The two key elements that go hand in hand and that are particularly important are ____________ and _______________.

A) recruitment; retention
B) hiring; firing
C) employee scheduling; benefits
D) recruitment; payroll
E) hiring; contracting

Question 75

To help retain talented employees, entrepreneurs employ a number of strategies to encourage them to stay with the venture. All but one of the following are the key benefits they are often offered:

A) ongoing promotions to higher level positions
B) pay raises each year
C) profit sharing
D) personal development funds
E) paid sabbaticals

Question 76

One of the most important roles an entrepreneur can provide is that of _______________.

A) stability provider
B) employee counsellor
C) change agent
D) financial controller
E) quality agent

Question 77

You are a management consultant specializing in business planning for new ventures. You are meeting with a group of four investors who want you to develop a business plan for their new bio-diesel company. You tell them that the full business plan is really the second step. The first step is to complete a __________________, which will eventually form the basis of the business plan.

A) market penetration evaluation
B) strategic plan
C) board of governance strategy
D) business plan
E) feasibility study

Question 78

As an entrepreneur, you need to be able to retain the good employees you have hired. The main reason being that when talented employees leave a new venture, ______________ can be negatively affected.

A) customer service
B) payroll expenses
C) the value proposition
D) operating expenses
E) potential new employees

Question 79

You are having a discussion with a friend who opened a gelato shop about six months ago. She has shared that it is time for her to hire a manager and promote a couple of employees to supervisors. She is a little concerned that the added structure will affect the natural flow of things. But you reassure her that good organization structure is a balance between ____________ and ____________, and may require some finessing to achieve the right mix of the two.

A) competence; creativity
B) fluidity; rigidity
C) fluidity; flexibility
D) rigidity; creativity
E) creativity; fluidity

Question 80

The most important thing an entrepreneur does before launching a venture is to complete a(n) ______________. This is a written document that summarizes a business opportunity and articulates how the identified opportunity is to be exploited.

A) market strategy
B) business plan
C) financial projection
D) feasibility study
E) articulation of distinctiveness report