Description
Brief explanation in regard to entrepreneurship and small business management fall semester 2012.
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MGNT 3618: Entrepreneurship and Small Business Management
Fall Semester 2012
Sec. # 01 – MW 12:30 pm - 1:50 pm, Classroom 2202 College of Business
Instructor: Kim Green, Ph.D., CFA Office hours: Mon & Wed: 9:00a – 12:30p &
Office: Business Building 2319 1:50p – 3:30p or other by appointment
E-mail address: [email protected] or [email protected]
COURSE DESCRIPTION: This course is intended to provide students with a solid foundation in the vital
role played by entrepreneurs and entrepreneurship in the 21st century global economy. Our emphasis is
on entrepreneurship as a manageable process that can be applied in virtually any organizational setting.
Broadly speaking, this process perspective should reveal the sustainable nature of entrepreneurship – or
entrepreneurship over the life cycles of people’s careers, of organizations as they evolve from start-up
enterprise to sizeable corporation, and of societies as they move from undeveloped to post-industrial.
However, our principal focus will be on the creation of new ventures, the ways that they come into being,
and factors associated with their success. This is a course that integrates a number of different
disciplines, ranging from sociology and psychology to economics, finance, marketing, and human
resource management. It is also a course that mixes theory with practice, and you will be challenged to
apply principles, concepts and frameworks to real world situations.
Course content will include the identification and analysis of market opportunities, the analysis and
acquisition of resources required to capture market opportunities, and the launch of a new venture. This
process will be assessed from the perspectives of the entrepreneur, customers, competitors and
investors. Whether this course succeeds or fails in its objectives does not depend on whether students
are prepared to successfully start and run a business solely as a result of taking the course. From
exposure to the fundamental aspects or basic issues of the subject, it is hoped that the students will
acquire relevant knowledge, understand, and appreciate the challenges and advantages of
entrepreneurship regardless of whether or not they consider practicing it.
COURSE OBJECTIVES: The course is built around the following core objectives:
1. Demonstrate in-depth understanding of new ventures and how they originate. (BBA 4)
2. Demonstrate in-depth understanding of how the integration of a number of different disciplines,
(including marketing, economics, finance, accounting, law, leadership, ethics, and human
resource management) form the foundation of a business. (BBA 4)
3. Research and evaluate new business opportunities. (BBA 1, MGT 2)
In our efforts to accomplish these objectives, this course will present you with opportunities to participate
in activities geared toward developing the following skills:
• Recognize the entrepreneurial potential within yourself and others in your environment;
• Appreciate the role of entrepreneurship within society, at the level of the organization, and in your own
personal life;
• Understand the process nature of entrepreneurship and ways to manage the process;
• Identify the many ways in which entrepreneurship manifests itself, including start-up contexts, corporate
contexts, social contexts, public sector contexts, and others;
• Develop an appreciation for opportunity, how to recognize it, and how to evaluate it;
• Appraise the nature of creative new business concepts that can be turned into sustainable businesses.
The course will use a combination of lectures, exercises, case studies, class discussion, team project,
and examinations to accomplish these objectives.
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COURSE MATERIALS:
Required Textbook: Small Business Management: Launching and Growing Entrepreneurial Ventures,
15
th
edition. 2010. J.G. Longnecker, J.W. Petty, L.E. Palich, and C.W. Moore. South-Western Cengage.
13-digit ISBN: 978-0-324-82784-2
Articles and cases for in-class discussion:
Cases either can be found in your textbook or will be posted on CourseDen. Articles will be posted on
CourseDen, distributed in class, or accessible through the library with instructions provided in class.
The following article is accessible through the website of the main library: “Creating Shared Value,” by M.
Porter & M. Kramer, Harvard Business Review, Jan/Feb 2011, pp. 62-77
CourseDen: Throughout the semester, announcements and assignments may be posted on CourseDen.
Students should check CourseDen frequently.
COURSE EVALUATION
COURSE EVALUATION CRITERIA
Four Exams (20% or 200 points each) 800 points 80%
Feasibility Analysis Project:
Individual Written Report 135 points 13.5%
Preliminary Analysis Participation (Team) 41 points 4.0%
Participation (3 points per assignment) 24 points 2.5%
Total Course Points 1000 points 100%
DETAILS ABOUT ASSIGNMENTS
EXAMS: There will be four exams given during the semester. Each of these exams is worth 20% of the
semester grade. Each exam will cover only the material introduced since the previous exam. The exam
format will typically consist of objective questions (i.e., multiple choice, problems) but may include short
answer and/or essay questions. The format of each exam will be announced in advance. Exam
questions will cover material from the textbook, cases, lectures and in-class discussions and exercises.
Make-up exams will be given only in the event of a university-accepted documented circumstance
(including, for example, illness, death in the family, required participation in University-sanctioned
function, religious holiday).
FEASIBILITY ANALYSIS PROJECT: For the feasibility analysis project, students may work alone or in
groups of up to 3 people. Students may form their own teams, or the instructor will assist in forming
groups. The project will be completed in stages, with due dates throughout the semester (see Course
Schedule). The first four stages (a through d) will be completed by the group (or individually for students
choosing to work alone). The last stage (the final written report) must be completed individually. At the
end of the syllabus, there are lists of questions related to different elements of feasibility. Your reports do
not have to include answers to all of these questions. But these questions can serve as a useful guide to
prompt your thinking as you work through the analyses.
(a) To begin the project, each group will submit a paper (one single-spaced page) that explains a new
business idea and analyzes the market feasibility of the idea.
(b) For the second step, each group will be assigned one of the business ideas that was submitted by a
different group in part (a). The market feasibility that was completed in part (a) will also be provided. The
group must build on this analysis by completing a technical feasibility analysis that is explained in a
written report of approximately one single-spaced page in length.
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(c) For the third step, another business idea will be rotated to the group, along with the associated market
and technical feasibility analyses. The group is to conduct a human resources feasibility analysis for
this idea and submit the analysis in a written report of approximately one single-spaced page in length.
(d) For the fourth step, another business idea will be rotated to the group for a financial feasibility
analysis. Again, the report should be submitted in a paper of approximately one single-spaced page in
length.
(e) For the final step, each group will receive all of the analyses related to its original idea. Each member
of the class, working individually, will then submit a report that explains the business idea and evaluates
the overall feasibility. INDIVIDUALLY, write a paper which should be 2-3 single-spaced pages long (not
counting appendices) and include the following sections:
(i) An abstract of no more than 150 words which summarizes the report.
(ii) A summary of the business idea. As a guide, you may choose to address some of the following
questions: Why did you choose this idea? What are the essential attributes of the idea? Where did the
idea come from? When you initially proposed the idea, did you think it had a strong or weak chance of
being feasible?
(iii) An analysis of the components of feasibility – market, technical, human resources, and financial. You
can mention what conclusions were reached by other groups who analyzed your idea and explain
whether you agree with these conclusions or not. Perhaps they raised points you had not considered –
explain these. [This section will represent the bulk of your report.] In addition to the suggested questions
listed at the end of the syllabus, you might consider: What resources would you need to exploit the idea?
What is your ability to carry out this idea? Who else might you need to involve? How profitable is the
venture likely to be? Present some numbers to justify your explanation of the feasibility of this idea.
Include a revenue forecast and a list of expenses to meet this forecast. (Present your figures in an
income statement format as an appendix.) What is the success potential, on a scale of 1 to 5 (with 5
being a profitable venture), of the idea being proposed and why?
(iv) A summary of what you learned through this project. Has your thinking about your business idea
changed as a result of seeing the analyses from other groups? Or perhaps your thinking about your own
idea has changed as a result of your work on other groups’ ideas during the semester. What important
questions had you overlooked that were brought to your attention by another group’s analysis?
The work for parts (a) through (d) will be graded primarily for participation, relevancy of content, and
demonstrated effort (including attention to grammar, proofreading, etc.). The individual report will be
graded for thoroughness and clarity of analysis, accurate use of business analysis techniques and
terminology, and overall professional quality of the finished product.
PARTICIPATION EXERCISES: There will be at least ten (10) opportunities to earn participation points in
class during the semester. Each activity will be worth up to 3 points. The total semester points for the
course grade includes 24 points for participation, or full credit for eight (8) of the 3-point exercises.
Additionally, 6 points of extra credit (or full credit for two 3-point exercises beyond the 8 exercises
included in the semester point total) will be allowed. For classes during which articles or cases will be
discussed, the article or case must be read prior to class in order to fully participate in the in-class
discussion or activity related to that reading. Some activities will be contained entirely within a class
meeting and will not require advance preparation. A student must be present in class in order to earn the
points for the participation activities.
The three (3) points for the participation activities will be assigned based on the following standards:
3 points – Strong, thoughtful answers indicating a clear understanding and focused participation.
2 points – Answers demonstrating acceptable content, comprehension, and strong participation effort.
1 points – Answers demonstrating a weak understanding of or participation in the case or activity.
0 points – No questions answered or superficial answers indicating an unacceptably poor effort.
FINAL GRADE FOR THE COURSE
The final grade for this course will be assigned on the basis of total points earned. There is no
adjustment for trends over time (either positively or negatively). Final Grades will be assigned based on
the following distribution:
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A 900 to 1000 points
B 800 to 899 points
C 700 to 799 points
D 600 to 699 points
F 599 points and below
COURSE POLICIES
ATTENDANCE POLICY: Classroom attendance is strongly recommended. However, roll will not be
taken. Note that while there is no formal attendance requirement, you are expected to attend every class
session unless classes have been officially canceled by the University or you have a University-
sanctioned excuse. If you miss a class, you are responsible for the material covered and announcements
made during that class. If the professor is more than 15 minutes late for class, the class is
considered canceled and the students may leave.
DEADLINES: No late assignment will be accepted unless the student notifies the professor in advance
or, in the event of an unforeseen emergency, immediately after the assignment was due and provides a
legitimate reason (as determined by the instructor).
ACADEMIC INTEGRITY: At the University of West Georgia, we believe that academic and personal
integrity are based upon honesty, trust, fairness, respect and responsibility. Students at West Georgia
assume responsibility for upholding the honor code. West Georgia students pledge to refrain from
engaging in acts that do not maintain academic and personal integrity. These include, but are not limited
to, plagiarism*, cheating*, fabrication*, aid of academic dishonesty, lying, bribery or threats, and stealing.
Definitions:
? Cheating – “using or attempting to use unauthorized materials, information or study aids”
? Fabrication – “falsification or unauthorized invention of any information or citation”
? Plagiarism – “representing the words or ideas of another as one’s own. Direct quotations must be
indicated and ideas of another must be appropriately acknowledged.”
The basic principle of academic integrity is that students take credit only for ideas and efforts that are
their own. Behavior outside that guideline is prohibited. Without truthfulness, honor, and responsibility
we cannot earn the trust and respect of others. Furthermore, we recognize that academic dishonesty
detracts from the value of the college degree. Therefore, we shall not tolerate academic dishonesty.
Academic dishonesty in any form will be pursued to the fullest extent allowed by the University and
College regulations.
DISPUTES: If you feel your grade on an assignment is inaccurate, you are encouraged to return the
assignment or exam for re-grading. Please employ the following process: Type all comments on another
sheet and turn it in to me within three days of the assignment’s return to you. Your request for re-grading
must clearly indicate why you believe you deserve a higher grade. I will not discuss the problem with you
until it is put into a written request. Reviews can lead to either an increase or decrease in total points
PERSONS WITH DISABILITIES: The University and the instructor are committed to providing equal
educational opportunities for all students. The University provides, on a flexible and individualized basis,
reasonable accommodations to students who have disabilities. Students with disabilities needing
academic accommodation are encouraged to:
1. Register with and provide documentation to the coordinators of Disability Services in the Student
Development Center
2. Bring a letter to the instructor indicating the need for accommodation and what type. During the first or
second week of class, students must present a letter to the professor stating that the disability has been
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documented and requesting specific accommodations. Additionally, it is the responsibility of the student
to give the professor one week’s notice prior to each instance where an accommodation will be needed.
It is expected that students will follow the policies and procedures of Student Disability Services. Further
details regarding student disabilities can be found in the Student Handbook.
SYLLABUS CHANGES: This syllabus provides a general plan for the course. The instructor reserves
the right to make changes to the syllabus plan as necessary. Changes will be announced in class.
CLASS SCHEDULE: ENTREPRENEURSHIP
[NOTE: Schedule is subject to change at discretion of instructor.]
Week Date Topic Notes Project Due Dates
1 M, Aug 20 Course introduction
W, Aug 22 Chapter 1
2 M, Aug 27 Chapter 2;
Article: Creating Shared Value
W, Aug 29 Chapter 3;
Article: What One Can Invent
3 M, Sep 3 No class LABOR DAY
W, Sep 5 Ch. 3 cont.: Opportunity Recognition
4 M, Sep 10 Ch. 3 cont: Feasibility;
Case: Being Ben Franklin
Market Feasibility
W, Sep 12 Chapter 4 & Appendix B;
Article: Spicy Pickle Franchising
5 M, Sep 17 Chapter 5; Case: WS Darley & Co.
W, Sep 19 Exam 1 Chs. 1–5, App. B,
cases/articles
6 M, Sep 24 Chapter 6 & Appendix A;
Article: Passion
W, Sep 26 Founding stories and elevator pitches Technical Feasibility
7 M, Oct 1 Chapter 7; Case: Firewire Surfboards
W, Oct 3 Chapter 8
8 M, Oct 8 Chapter 9
W, Oct 10 Chapter 10
9 M, Oct 15 Case: Boaters Bay HR Feasibility
W, Oct 17
Exam 2
Chs. 6–10, App. A,
cases/articles
10 M, Oct 22 Chapter 11; Case: Missouri Solvents
W, Oct 24 Chapter 12
11 M, Oct 29 Chapter 13; Case: CitiStorage
W, Oct 31 Chapter 15; Case: Nau Financial Feasibility
12 M, Nov 5 Financials review
W, Nov 7 Exam 3 Chs. 11–13 & 15,
cases/articles
13 M, Nov 12 Chapter 19
W, Nov 14 In-class exercises
14 M, Nov 19 No class THANKSGIVING
W, Nov 21 No class THANKSGIVING
15 M, Nov 26 Chapter 21
W, Nov 28 Chapters 22 & 23 Individual Report
Finals
Dec 3 – 7
Exam 4 during final exam schedule
Wed, Dec 5, 11a – 1:30p
Chs. 19, 21–23,
cases/articles
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Detailed Feasibility Analysis Questions to Aid with Semester Report
Feasibility Evaluation is based on research in four main areas: [Note you do not have to provide an
answer for every one of these questions. But the list of questions can guide your analysis and
identification of key issues that would need attention or further research.]
Market Feasibility
Questions to Answer from Primary Research
1. What pain or problem are customers encountering? What do customers want?
2. Where are customers getting the product now? What do customers think of their current service?
3. What would customers think about your service? What are the direct benefits to the customer?
4. Where are the customers?
5. How will you reach them?
6. Why would they purchase from you?
7. What external factors come to bear? (Government, Industry Dynamics etc.)
8. How long will this opportunity last in the market? (Window of Opportunity)
9. What keeps new competition from entering this market? (Barriers to Entry)
- Do a Competitive Grid and a Price Quality Matrix to show which niche you will attempt to fulfill.
10. How long will this product or service have market demand? (Product life -cycle)
Questions to Answer from Secondary Research
1. What is the size of the market?
2. What is the growth rate of the industry?
3. Is the market at full capacity?
4. Where are customers getting the product now?
5. Where are the customers?
6. How many would purchase from you?
7. What external factors come to bear? Government, Industry Dynamics
8. How long will this opportunity last in the market? (Window of Opportunity)
9. What keeps new competition from entering this market? (Barriers to Entry)
Technical Feasibility
Questions to Answer
NOTE: The answers come primarily from qualitative research
1. What are the options for developing the technology (customer, off the shelf, design yourself,
subcontract)?
2. What are the options for producing the product or service?
• In House
• Subcontract
• License
• Joint Venture or Partnership
• Combination
3. What are the options for Sales and Distribution?
• In House
• Whole Sale
• Distributors or Sales Representatives
• License
• Joint Venture or Partnership
• Combination
4. What resources are required for development and are they available to you (skills, raw materials,
components, suppliers, facilities & equipment)?
5. What are the laws and regulation relating to the business?
• Industry Standards or Regulations (Dangerous Goods, (Canadian Standards
Association - CSA), ISO
• Personal Certifications
• Intellectual Property (Patents, trademarks, copyrights)
• Environmental Liability
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6. Has the research discovered any moral or ethical issues that you are uncomfortable with?
7. What technological changes are changing or emerging that may affect the business?
Human Resource Feasibility
Questions:
1. What technical and management experience is required?
2. Who are the owners and what are their roles? (Entrepreneur, Manager, Tech. Expert)
3. What is the ownership structure?
4. What are the manpower requirements?
- How will you find the right employees?
- How will you compensate employees (pay for time, for production, for knowledge, or a combination)?
- How will you motivate employees?
- What training will they need on an ongoing basis?
5. What is the company’s growth strategy?
- How will quality be managed and maintained÷
- How will organizational structures change with growth?
- What career paths will employees have available?
Financial Feasibility
1 What are the projected Revenues from the sale of your product or service?
• From the Market Research, what is the projected sales volume in "units sold?" and in "dollars sold"?
• From the Market Research, what is the selling price per unit?
• What is the total expected revenue?
2. What are the financial dynamics and opportunities?
• Costs Structure (per unit basis)
- Price per unit minus
- Variable Costs (Cost of Good Sold & Controllable Costs) per Unit equal
- Gross Margin per Unit minus
- Fixed Costs per Unit equal
- Net Margin per Unit
3. Is it worthwhile financially?
• 1 Year Monthly Cash Flow Statement. (Completed in a spread sheet format so it can be built upon with
new information)
• Ensure that you clearly show all assumptions for this statement.
4. How much investment is required?
• One Time Assets and Startup Expenses
- Plant & Equipment
- Leasehold Improvements
- Initial Inventories
- Research & Development
- Legal
- Experts
• Operating expenses prior to break even
(Appendix A Startup Expenditures & Expenses Worksheet)
5. What are the financial risks?
• Break Even Analysis Units to break even. (Total fixed costs from Income statement divided by Gross
margin per unit) Figure out on a monthly basis.
• Payback (Investment required divided by net margin per unit - Date when units calculated above are
sold & collected.)
• Return on Investment (Yearly Net Profit divided by Total Investment required)
• Risk vs. Reward (Personal feelings of the risks and rewards)
• Opportunity Costs (Can you get a better return somewhere else?)
• Personal Financial Risk (What will you have to give up. Sign over mortgage etc.)
6. What are the possible sources of financing?
• Chances of getting the money?
• What will you have to give up?
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7. General Financial Numbers that would indicate attractiveness of Venture
• Gross Margin 20 - 30% plus
• Net Profit Margin - 10 to 15%. Plus
• Return on Investment - 15% plus
• Payback - 3 years or less.
• Break even - 2 years or less
• Note: These numbers must not be looked at in isolation over a one year period. You need to look at the
numbers over a 3 year period and as a whole, not just individually. Industry averages can be quite
different.
Start-up Expenditures and Expenses Worksheet
Item Total Cost Cash Required
Land __________ __________
Capital Equipment __________ __________
Computer __________ __________
Beginning Inventory __________ __________
Start up Supplies __________ __________
Licenses and Permits __________ __________
Leasehold Improvements __________ __________
Utility hookups & Installation __________ __________
Advertising (Preopening) __________ __________
Insurance __________ __________
Other __________ __________
___________ __________ __________
___________ __________ __________
Total Estimated One-Time Cash Requirements __________ __________
Start-up Operating Expenses
Item Monthly Expense X Estimate No. of Months Before Break even = Total Cash Required
Owners Salary __________ __________ __________
Employee’s salary, wages, benefits __________ __________ __________
Rent __________ __________ __________
Promotion expenses __________ __________ __________
Supplies and postage __________ __________ __________
Vehicle Expenses __________ __________ __________
Telephone __________ __________ __________
Travel __________ __________ __________
Interest __________ __________ __________
Maintenance __________ __________ __________
Other __________ __________ __________
____________ __________ __________ __________
Total Cash Required to Cover Operating Expenses _________
Plus: Total One-Time Cash Requirements (Previous Table) __________
Add 10% Safety Factor __________
Total Cash Required for Start-up _________
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Back of the Envelope Feasibility Guide
[Adapted from: P. Robinson, D. Harding, V. Gough (copyright 1998)]
This can be completed in one group sitting. Don't worry too much if you can’t answer all of the questions
with certainty. Make your best guess. (HINT: A majority of business ideas can likely be screened out
through an evaluation process such as this.) Determine quickly if an idea is a Go or No Go in terms of
keeping this idea or moving on to the next.
1. Evaluate Market, Technical, Human Resource, and Financial Feasibility.
a. Market Feasibility
Key Question: Is this a service or product that customers will buy?
• What are the direct benefits to the customer?
• Describe the pain or problem that the service or product will fix?
• Approximate the best you can the size of the market?
• Where are customers getting the product now?
• Where are the customers?
• How will we reach them?
• Why would they purchase from us?
• How many would purchase from us?
• Is this a product or service that other products or services can be expanded from over time? (Platform
product or service) What are the opportunities for growth?
• Is the industry that the business falls within, large and growing? (Favorable)
b. Technical Feasibility
Key questions to answer: Can it be done and should it be done?
• Are the core technologies available? (Have, develop or get)
• Are there any laws or regulations against this business concept?
• Are there moral or ethical issues that need to be considered?
c. Human Resource Feasibility
Key Question: Is this the right business for me?
• What are our interests?
• What are our values?
• Do our skills and abilities fit the business?
• What are the skills needed that we don't have?
• Who would we need to hire, when and how much would it cost?
d. Financial Feasibility
Key Question: Will this venture be worthwhile financially?
• Sales projection for the first year of operation?
• Fixed and variable costs?
• Gross and net margins? (Attractive opportunities have potential for durable profits of at least 10 -15 %
net margin)
• Assets and pre-start up expenses?
• Can we raise the capital to start this venture?
2. Technical Development Considerations: Can You . . . ?
_ Keep it Simple: Keep it simple to build, transport, maintain, and use.
_ Make it Flexible: Product might be used for a number of different applications.
_ Make it Robust and Work as Intended: Products needs to be durable, reliable, safe and easily
maintainable.
3. Compare your Idea to the Ideal Business
Very Good Average Poor
No investment ________ ________ ________
Recognized market ________ ________ ________
Dependable supply ________ ________ ________
No labor force ________ ________ ________
100% gross margin ________ ________ ________
Frequent purchase ________ ________ ________
10
Favorable tax treatment ________ ________ ________
Established distribution ________ ________ ________
Great publicity value ________ ________ ________
Payment in advance ________ ________ ________
No liability risk ________ ________ ________
No technical Obsolescence ________ ________ ________
No physical perishability ________ ________ ________
Impervious to weather ________ ________ ________
Proprietary rights ________ ________ ________
4. Compare your Idea to Fatal Flaws
Very Good Average Poor
Very small market for the product. _______ ______ ______
Overpowering competition and high cost of entry. _______ _______ ______
Inability to produce a competitively priced product. _______ _______ ______
Lack of influence over product development costs. _______ _______ ______
Inability to go beyond a one-product company. _______ _______ ______
Overwhelming financial requirements. _______ _______ ______
Inability to achieve adequate growth. _______ _______ ______
doc_790227269.pdf
Brief explanation in regard to entrepreneurship and small business management fall semester 2012.
1
MGNT 3618: Entrepreneurship and Small Business Management
Fall Semester 2012
Sec. # 01 – MW 12:30 pm - 1:50 pm, Classroom 2202 College of Business
Instructor: Kim Green, Ph.D., CFA Office hours: Mon & Wed: 9:00a – 12:30p &
Office: Business Building 2319 1:50p – 3:30p or other by appointment
E-mail address: [email protected] or [email protected]
COURSE DESCRIPTION: This course is intended to provide students with a solid foundation in the vital
role played by entrepreneurs and entrepreneurship in the 21st century global economy. Our emphasis is
on entrepreneurship as a manageable process that can be applied in virtually any organizational setting.
Broadly speaking, this process perspective should reveal the sustainable nature of entrepreneurship – or
entrepreneurship over the life cycles of people’s careers, of organizations as they evolve from start-up
enterprise to sizeable corporation, and of societies as they move from undeveloped to post-industrial.
However, our principal focus will be on the creation of new ventures, the ways that they come into being,
and factors associated with their success. This is a course that integrates a number of different
disciplines, ranging from sociology and psychology to economics, finance, marketing, and human
resource management. It is also a course that mixes theory with practice, and you will be challenged to
apply principles, concepts and frameworks to real world situations.
Course content will include the identification and analysis of market opportunities, the analysis and
acquisition of resources required to capture market opportunities, and the launch of a new venture. This
process will be assessed from the perspectives of the entrepreneur, customers, competitors and
investors. Whether this course succeeds or fails in its objectives does not depend on whether students
are prepared to successfully start and run a business solely as a result of taking the course. From
exposure to the fundamental aspects or basic issues of the subject, it is hoped that the students will
acquire relevant knowledge, understand, and appreciate the challenges and advantages of
entrepreneurship regardless of whether or not they consider practicing it.
COURSE OBJECTIVES: The course is built around the following core objectives:
1. Demonstrate in-depth understanding of new ventures and how they originate. (BBA 4)
2. Demonstrate in-depth understanding of how the integration of a number of different disciplines,
(including marketing, economics, finance, accounting, law, leadership, ethics, and human
resource management) form the foundation of a business. (BBA 4)
3. Research and evaluate new business opportunities. (BBA 1, MGT 2)
In our efforts to accomplish these objectives, this course will present you with opportunities to participate
in activities geared toward developing the following skills:
• Recognize the entrepreneurial potential within yourself and others in your environment;
• Appreciate the role of entrepreneurship within society, at the level of the organization, and in your own
personal life;
• Understand the process nature of entrepreneurship and ways to manage the process;
• Identify the many ways in which entrepreneurship manifests itself, including start-up contexts, corporate
contexts, social contexts, public sector contexts, and others;
• Develop an appreciation for opportunity, how to recognize it, and how to evaluate it;
• Appraise the nature of creative new business concepts that can be turned into sustainable businesses.
The course will use a combination of lectures, exercises, case studies, class discussion, team project,
and examinations to accomplish these objectives.
2
COURSE MATERIALS:
Required Textbook: Small Business Management: Launching and Growing Entrepreneurial Ventures,
15
th
edition. 2010. J.G. Longnecker, J.W. Petty, L.E. Palich, and C.W. Moore. South-Western Cengage.
13-digit ISBN: 978-0-324-82784-2
Articles and cases for in-class discussion:
Cases either can be found in your textbook or will be posted on CourseDen. Articles will be posted on
CourseDen, distributed in class, or accessible through the library with instructions provided in class.
The following article is accessible through the website of the main library: “Creating Shared Value,” by M.
Porter & M. Kramer, Harvard Business Review, Jan/Feb 2011, pp. 62-77
CourseDen: Throughout the semester, announcements and assignments may be posted on CourseDen.
Students should check CourseDen frequently.
COURSE EVALUATION
COURSE EVALUATION CRITERIA
Four Exams (20% or 200 points each) 800 points 80%
Feasibility Analysis Project:
Individual Written Report 135 points 13.5%
Preliminary Analysis Participation (Team) 41 points 4.0%
Participation (3 points per assignment) 24 points 2.5%
Total Course Points 1000 points 100%
DETAILS ABOUT ASSIGNMENTS
EXAMS: There will be four exams given during the semester. Each of these exams is worth 20% of the
semester grade. Each exam will cover only the material introduced since the previous exam. The exam
format will typically consist of objective questions (i.e., multiple choice, problems) but may include short
answer and/or essay questions. The format of each exam will be announced in advance. Exam
questions will cover material from the textbook, cases, lectures and in-class discussions and exercises.
Make-up exams will be given only in the event of a university-accepted documented circumstance
(including, for example, illness, death in the family, required participation in University-sanctioned
function, religious holiday).
FEASIBILITY ANALYSIS PROJECT: For the feasibility analysis project, students may work alone or in
groups of up to 3 people. Students may form their own teams, or the instructor will assist in forming
groups. The project will be completed in stages, with due dates throughout the semester (see Course
Schedule). The first four stages (a through d) will be completed by the group (or individually for students
choosing to work alone). The last stage (the final written report) must be completed individually. At the
end of the syllabus, there are lists of questions related to different elements of feasibility. Your reports do
not have to include answers to all of these questions. But these questions can serve as a useful guide to
prompt your thinking as you work through the analyses.
(a) To begin the project, each group will submit a paper (one single-spaced page) that explains a new
business idea and analyzes the market feasibility of the idea.
(b) For the second step, each group will be assigned one of the business ideas that was submitted by a
different group in part (a). The market feasibility that was completed in part (a) will also be provided. The
group must build on this analysis by completing a technical feasibility analysis that is explained in a
written report of approximately one single-spaced page in length.
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(c) For the third step, another business idea will be rotated to the group, along with the associated market
and technical feasibility analyses. The group is to conduct a human resources feasibility analysis for
this idea and submit the analysis in a written report of approximately one single-spaced page in length.
(d) For the fourth step, another business idea will be rotated to the group for a financial feasibility
analysis. Again, the report should be submitted in a paper of approximately one single-spaced page in
length.
(e) For the final step, each group will receive all of the analyses related to its original idea. Each member
of the class, working individually, will then submit a report that explains the business idea and evaluates
the overall feasibility. INDIVIDUALLY, write a paper which should be 2-3 single-spaced pages long (not
counting appendices) and include the following sections:
(i) An abstract of no more than 150 words which summarizes the report.
(ii) A summary of the business idea. As a guide, you may choose to address some of the following
questions: Why did you choose this idea? What are the essential attributes of the idea? Where did the
idea come from? When you initially proposed the idea, did you think it had a strong or weak chance of
being feasible?
(iii) An analysis of the components of feasibility – market, technical, human resources, and financial. You
can mention what conclusions were reached by other groups who analyzed your idea and explain
whether you agree with these conclusions or not. Perhaps they raised points you had not considered –
explain these. [This section will represent the bulk of your report.] In addition to the suggested questions
listed at the end of the syllabus, you might consider: What resources would you need to exploit the idea?
What is your ability to carry out this idea? Who else might you need to involve? How profitable is the
venture likely to be? Present some numbers to justify your explanation of the feasibility of this idea.
Include a revenue forecast and a list of expenses to meet this forecast. (Present your figures in an
income statement format as an appendix.) What is the success potential, on a scale of 1 to 5 (with 5
being a profitable venture), of the idea being proposed and why?
(iv) A summary of what you learned through this project. Has your thinking about your business idea
changed as a result of seeing the analyses from other groups? Or perhaps your thinking about your own
idea has changed as a result of your work on other groups’ ideas during the semester. What important
questions had you overlooked that were brought to your attention by another group’s analysis?
The work for parts (a) through (d) will be graded primarily for participation, relevancy of content, and
demonstrated effort (including attention to grammar, proofreading, etc.). The individual report will be
graded for thoroughness and clarity of analysis, accurate use of business analysis techniques and
terminology, and overall professional quality of the finished product.
PARTICIPATION EXERCISES: There will be at least ten (10) opportunities to earn participation points in
class during the semester. Each activity will be worth up to 3 points. The total semester points for the
course grade includes 24 points for participation, or full credit for eight (8) of the 3-point exercises.
Additionally, 6 points of extra credit (or full credit for two 3-point exercises beyond the 8 exercises
included in the semester point total) will be allowed. For classes during which articles or cases will be
discussed, the article or case must be read prior to class in order to fully participate in the in-class
discussion or activity related to that reading. Some activities will be contained entirely within a class
meeting and will not require advance preparation. A student must be present in class in order to earn the
points for the participation activities.
The three (3) points for the participation activities will be assigned based on the following standards:
3 points – Strong, thoughtful answers indicating a clear understanding and focused participation.
2 points – Answers demonstrating acceptable content, comprehension, and strong participation effort.
1 points – Answers demonstrating a weak understanding of or participation in the case or activity.
0 points – No questions answered or superficial answers indicating an unacceptably poor effort.
FINAL GRADE FOR THE COURSE
The final grade for this course will be assigned on the basis of total points earned. There is no
adjustment for trends over time (either positively or negatively). Final Grades will be assigned based on
the following distribution:
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A 900 to 1000 points
B 800 to 899 points
C 700 to 799 points
D 600 to 699 points
F 599 points and below
COURSE POLICIES
ATTENDANCE POLICY: Classroom attendance is strongly recommended. However, roll will not be
taken. Note that while there is no formal attendance requirement, you are expected to attend every class
session unless classes have been officially canceled by the University or you have a University-
sanctioned excuse. If you miss a class, you are responsible for the material covered and announcements
made during that class. If the professor is more than 15 minutes late for class, the class is
considered canceled and the students may leave.
DEADLINES: No late assignment will be accepted unless the student notifies the professor in advance
or, in the event of an unforeseen emergency, immediately after the assignment was due and provides a
legitimate reason (as determined by the instructor).
ACADEMIC INTEGRITY: At the University of West Georgia, we believe that academic and personal
integrity are based upon honesty, trust, fairness, respect and responsibility. Students at West Georgia
assume responsibility for upholding the honor code. West Georgia students pledge to refrain from
engaging in acts that do not maintain academic and personal integrity. These include, but are not limited
to, plagiarism*, cheating*, fabrication*, aid of academic dishonesty, lying, bribery or threats, and stealing.
Definitions:
? Cheating – “using or attempting to use unauthorized materials, information or study aids”
? Fabrication – “falsification or unauthorized invention of any information or citation”
? Plagiarism – “representing the words or ideas of another as one’s own. Direct quotations must be
indicated and ideas of another must be appropriately acknowledged.”
The basic principle of academic integrity is that students take credit only for ideas and efforts that are
their own. Behavior outside that guideline is prohibited. Without truthfulness, honor, and responsibility
we cannot earn the trust and respect of others. Furthermore, we recognize that academic dishonesty
detracts from the value of the college degree. Therefore, we shall not tolerate academic dishonesty.
Academic dishonesty in any form will be pursued to the fullest extent allowed by the University and
College regulations.
DISPUTES: If you feel your grade on an assignment is inaccurate, you are encouraged to return the
assignment or exam for re-grading. Please employ the following process: Type all comments on another
sheet and turn it in to me within three days of the assignment’s return to you. Your request for re-grading
must clearly indicate why you believe you deserve a higher grade. I will not discuss the problem with you
until it is put into a written request. Reviews can lead to either an increase or decrease in total points
PERSONS WITH DISABILITIES: The University and the instructor are committed to providing equal
educational opportunities for all students. The University provides, on a flexible and individualized basis,
reasonable accommodations to students who have disabilities. Students with disabilities needing
academic accommodation are encouraged to:
1. Register with and provide documentation to the coordinators of Disability Services in the Student
Development Center
2. Bring a letter to the instructor indicating the need for accommodation and what type. During the first or
second week of class, students must present a letter to the professor stating that the disability has been
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documented and requesting specific accommodations. Additionally, it is the responsibility of the student
to give the professor one week’s notice prior to each instance where an accommodation will be needed.
It is expected that students will follow the policies and procedures of Student Disability Services. Further
details regarding student disabilities can be found in the Student Handbook.
SYLLABUS CHANGES: This syllabus provides a general plan for the course. The instructor reserves
the right to make changes to the syllabus plan as necessary. Changes will be announced in class.
CLASS SCHEDULE: ENTREPRENEURSHIP
[NOTE: Schedule is subject to change at discretion of instructor.]
Week Date Topic Notes Project Due Dates
1 M, Aug 20 Course introduction
W, Aug 22 Chapter 1
2 M, Aug 27 Chapter 2;
Article: Creating Shared Value
W, Aug 29 Chapter 3;
Article: What One Can Invent
3 M, Sep 3 No class LABOR DAY
W, Sep 5 Ch. 3 cont.: Opportunity Recognition
4 M, Sep 10 Ch. 3 cont: Feasibility;
Case: Being Ben Franklin
Market Feasibility
W, Sep 12 Chapter 4 & Appendix B;
Article: Spicy Pickle Franchising
5 M, Sep 17 Chapter 5; Case: WS Darley & Co.
W, Sep 19 Exam 1 Chs. 1–5, App. B,
cases/articles
6 M, Sep 24 Chapter 6 & Appendix A;
Article: Passion
W, Sep 26 Founding stories and elevator pitches Technical Feasibility
7 M, Oct 1 Chapter 7; Case: Firewire Surfboards
W, Oct 3 Chapter 8
8 M, Oct 8 Chapter 9
W, Oct 10 Chapter 10
9 M, Oct 15 Case: Boaters Bay HR Feasibility
W, Oct 17
Exam 2
Chs. 6–10, App. A,
cases/articles
10 M, Oct 22 Chapter 11; Case: Missouri Solvents
W, Oct 24 Chapter 12
11 M, Oct 29 Chapter 13; Case: CitiStorage
W, Oct 31 Chapter 15; Case: Nau Financial Feasibility
12 M, Nov 5 Financials review
W, Nov 7 Exam 3 Chs. 11–13 & 15,
cases/articles
13 M, Nov 12 Chapter 19
W, Nov 14 In-class exercises
14 M, Nov 19 No class THANKSGIVING
W, Nov 21 No class THANKSGIVING
15 M, Nov 26 Chapter 21
W, Nov 28 Chapters 22 & 23 Individual Report
Finals
Dec 3 – 7
Exam 4 during final exam schedule
Wed, Dec 5, 11a – 1:30p
Chs. 19, 21–23,
cases/articles
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Detailed Feasibility Analysis Questions to Aid with Semester Report
Feasibility Evaluation is based on research in four main areas: [Note you do not have to provide an
answer for every one of these questions. But the list of questions can guide your analysis and
identification of key issues that would need attention or further research.]
Market Feasibility
Questions to Answer from Primary Research
1. What pain or problem are customers encountering? What do customers want?
2. Where are customers getting the product now? What do customers think of their current service?
3. What would customers think about your service? What are the direct benefits to the customer?
4. Where are the customers?
5. How will you reach them?
6. Why would they purchase from you?
7. What external factors come to bear? (Government, Industry Dynamics etc.)
8. How long will this opportunity last in the market? (Window of Opportunity)
9. What keeps new competition from entering this market? (Barriers to Entry)
- Do a Competitive Grid and a Price Quality Matrix to show which niche you will attempt to fulfill.
10. How long will this product or service have market demand? (Product life -cycle)
Questions to Answer from Secondary Research
1. What is the size of the market?
2. What is the growth rate of the industry?
3. Is the market at full capacity?
4. Where are customers getting the product now?
5. Where are the customers?
6. How many would purchase from you?
7. What external factors come to bear? Government, Industry Dynamics
8. How long will this opportunity last in the market? (Window of Opportunity)
9. What keeps new competition from entering this market? (Barriers to Entry)
Technical Feasibility
Questions to Answer
NOTE: The answers come primarily from qualitative research
1. What are the options for developing the technology (customer, off the shelf, design yourself,
subcontract)?
2. What are the options for producing the product or service?
• In House
• Subcontract
• License
• Joint Venture or Partnership
• Combination
3. What are the options for Sales and Distribution?
• In House
• Whole Sale
• Distributors or Sales Representatives
• License
• Joint Venture or Partnership
• Combination
4. What resources are required for development and are they available to you (skills, raw materials,
components, suppliers, facilities & equipment)?
5. What are the laws and regulation relating to the business?
• Industry Standards or Regulations (Dangerous Goods, (Canadian Standards
Association - CSA), ISO
• Personal Certifications
• Intellectual Property (Patents, trademarks, copyrights)
• Environmental Liability
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6. Has the research discovered any moral or ethical issues that you are uncomfortable with?
7. What technological changes are changing or emerging that may affect the business?
Human Resource Feasibility
Questions:
1. What technical and management experience is required?
2. Who are the owners and what are their roles? (Entrepreneur, Manager, Tech. Expert)
3. What is the ownership structure?
4. What are the manpower requirements?
- How will you find the right employees?
- How will you compensate employees (pay for time, for production, for knowledge, or a combination)?
- How will you motivate employees?
- What training will they need on an ongoing basis?
5. What is the company’s growth strategy?
- How will quality be managed and maintained÷
- How will organizational structures change with growth?
- What career paths will employees have available?
Financial Feasibility
1 What are the projected Revenues from the sale of your product or service?
• From the Market Research, what is the projected sales volume in "units sold?" and in "dollars sold"?
• From the Market Research, what is the selling price per unit?
• What is the total expected revenue?
2. What are the financial dynamics and opportunities?
• Costs Structure (per unit basis)
- Price per unit minus
- Variable Costs (Cost of Good Sold & Controllable Costs) per Unit equal
- Gross Margin per Unit minus
- Fixed Costs per Unit equal
- Net Margin per Unit
3. Is it worthwhile financially?
• 1 Year Monthly Cash Flow Statement. (Completed in a spread sheet format so it can be built upon with
new information)
• Ensure that you clearly show all assumptions for this statement.
4. How much investment is required?
• One Time Assets and Startup Expenses
- Plant & Equipment
- Leasehold Improvements
- Initial Inventories
- Research & Development
- Legal
- Experts
• Operating expenses prior to break even
(Appendix A Startup Expenditures & Expenses Worksheet)
5. What are the financial risks?
• Break Even Analysis Units to break even. (Total fixed costs from Income statement divided by Gross
margin per unit) Figure out on a monthly basis.
• Payback (Investment required divided by net margin per unit - Date when units calculated above are
sold & collected.)
• Return on Investment (Yearly Net Profit divided by Total Investment required)
• Risk vs. Reward (Personal feelings of the risks and rewards)
• Opportunity Costs (Can you get a better return somewhere else?)
• Personal Financial Risk (What will you have to give up. Sign over mortgage etc.)
6. What are the possible sources of financing?
• Chances of getting the money?
• What will you have to give up?
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7. General Financial Numbers that would indicate attractiveness of Venture
• Gross Margin 20 - 30% plus
• Net Profit Margin - 10 to 15%. Plus
• Return on Investment - 15% plus
• Payback - 3 years or less.
• Break even - 2 years or less
• Note: These numbers must not be looked at in isolation over a one year period. You need to look at the
numbers over a 3 year period and as a whole, not just individually. Industry averages can be quite
different.
Start-up Expenditures and Expenses Worksheet
Item Total Cost Cash Required
Land __________ __________
Capital Equipment __________ __________
Computer __________ __________
Beginning Inventory __________ __________
Start up Supplies __________ __________
Licenses and Permits __________ __________
Leasehold Improvements __________ __________
Utility hookups & Installation __________ __________
Advertising (Preopening) __________ __________
Insurance __________ __________
Other __________ __________
___________ __________ __________
___________ __________ __________
Total Estimated One-Time Cash Requirements __________ __________
Start-up Operating Expenses
Item Monthly Expense X Estimate No. of Months Before Break even = Total Cash Required
Owners Salary __________ __________ __________
Employee’s salary, wages, benefits __________ __________ __________
Rent __________ __________ __________
Promotion expenses __________ __________ __________
Supplies and postage __________ __________ __________
Vehicle Expenses __________ __________ __________
Telephone __________ __________ __________
Travel __________ __________ __________
Interest __________ __________ __________
Maintenance __________ __________ __________
Other __________ __________ __________
____________ __________ __________ __________
Total Cash Required to Cover Operating Expenses _________
Plus: Total One-Time Cash Requirements (Previous Table) __________
Add 10% Safety Factor __________
Total Cash Required for Start-up _________
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Back of the Envelope Feasibility Guide
[Adapted from: P. Robinson, D. Harding, V. Gough (copyright 1998)]
This can be completed in one group sitting. Don't worry too much if you can’t answer all of the questions
with certainty. Make your best guess. (HINT: A majority of business ideas can likely be screened out
through an evaluation process such as this.) Determine quickly if an idea is a Go or No Go in terms of
keeping this idea or moving on to the next.
1. Evaluate Market, Technical, Human Resource, and Financial Feasibility.
a. Market Feasibility
Key Question: Is this a service or product that customers will buy?
• What are the direct benefits to the customer?
• Describe the pain or problem that the service or product will fix?
• Approximate the best you can the size of the market?
• Where are customers getting the product now?
• Where are the customers?
• How will we reach them?
• Why would they purchase from us?
• How many would purchase from us?
• Is this a product or service that other products or services can be expanded from over time? (Platform
product or service) What are the opportunities for growth?
• Is the industry that the business falls within, large and growing? (Favorable)
b. Technical Feasibility
Key questions to answer: Can it be done and should it be done?
• Are the core technologies available? (Have, develop or get)
• Are there any laws or regulations against this business concept?
• Are there moral or ethical issues that need to be considered?
c. Human Resource Feasibility
Key Question: Is this the right business for me?
• What are our interests?
• What are our values?
• Do our skills and abilities fit the business?
• What are the skills needed that we don't have?
• Who would we need to hire, when and how much would it cost?
d. Financial Feasibility
Key Question: Will this venture be worthwhile financially?
• Sales projection for the first year of operation?
• Fixed and variable costs?
• Gross and net margins? (Attractive opportunities have potential for durable profits of at least 10 -15 %
net margin)
• Assets and pre-start up expenses?
• Can we raise the capital to start this venture?
2. Technical Development Considerations: Can You . . . ?
_ Keep it Simple: Keep it simple to build, transport, maintain, and use.
_ Make it Flexible: Product might be used for a number of different applications.
_ Make it Robust and Work as Intended: Products needs to be durable, reliable, safe and easily
maintainable.
3. Compare your Idea to the Ideal Business
Very Good Average Poor
No investment ________ ________ ________
Recognized market ________ ________ ________
Dependable supply ________ ________ ________
No labor force ________ ________ ________
100% gross margin ________ ________ ________
Frequent purchase ________ ________ ________
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Favorable tax treatment ________ ________ ________
Established distribution ________ ________ ________
Great publicity value ________ ________ ________
Payment in advance ________ ________ ________
No liability risk ________ ________ ________
No technical Obsolescence ________ ________ ________
No physical perishability ________ ________ ________
Impervious to weather ________ ________ ________
Proprietary rights ________ ________ ________
4. Compare your Idea to Fatal Flaws
Very Good Average Poor
Very small market for the product. _______ ______ ______
Overpowering competition and high cost of entry. _______ _______ ______
Inability to produce a competitively priced product. _______ _______ ______
Lack of influence over product development costs. _______ _______ ______
Inability to go beyond a one-product company. _______ _______ ______
Overwhelming financial requirements. _______ _______ ______
Inability to achieve adequate growth. _______ _______ ______
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