Entrepreneurship and Strategic Decisions - VIDEO 6 - MODULE 1

Entrepreneur And Strategic Decisions

SOURCE: https://www.youtube.com/watch?v=N6YSqJPFYDU

We also want to recognize that the study of entrepreneurial decision making, leads to better decisions and leads to better entrepreneurs. And so, what we want to think about too in entrepreneurship. Is that the decisions that we make, are different than what a typical company manager might make. 

We're operating as entrepreneurs with limited information. If we're doing something new, almost by definition, it hasn't been done many times before. So we don't necessarily have a lot of precedent to work from. We need to be action oriented and decisive, as we're working in new markets. As we're trying to take advantage of opportunities before others. We don't want to be idle. We don't want the window of opportunity to be closed on us. We also need to be perhaps more accepting of risk than a corporate manager and we might involve major consequences. What we mean by major consequences, is that, we might only have the opportunity to try something once. We might not have the time or the budget to try the same thing a second, third, or fourth time. We might need to get it right, fairly early on. And so in that context, what some of the consequences are of failure, are a bit more significant or significantly more significant for entrepreneurs than for company managers. Decision-making is also a strategic activity. We want to recognize that with entrepreneurship, we want to think about our goals. We want to think about if we're a for-profit venture, what are our revenue and profit goals? What's the market share opportunity that we're targeting? What are the product advantages that we are aiming for? And so I'm a big believer in setting goals, and by setting goals, it's going to do a lot for charting the path on how to get there. We also want to recognize that we want to be critical in our analysis. We want to think about the allocation of our resources and the allocation of our commitment and our relative priorities. 

Within strategic decision making, there are a variety of characteristics that play a role. One is complexity. We want to think about the facts and the figures and the contingencies. We need to think about the uncertainty elements. We need to think about the rationality of it and not to be geared purely by emotion in our decisions. Then we want to think about the control element, of what deliberate actions can we take to maximize our success as entrepreneurs. 

We want to think about the environment that we're operating in. If we look at this picture, this individual is walking up a flight of stairs. 

If we take a broader picture. If we take a broader perspective. If we reduce our tunnel vision, and think about where does this individual truly sit? Well, then within this MC Escher drawing, he may be going up. He may be going down. He may be going left or right. When you look off to the right-hand side, you see trees growing to the right. 

When you look to the left-hand side in the upper corner, trees are growing to the left. 

We're not sure which way we're going. 

And this is not uncommon for entrepreneurs at times. The environment is challenging. The environment is dynamic. The environment is changing. As we progress, and as we advance. And as we start marching in one direction, our customers, our competitors, our markets, our governments, our regulations may all be going in different directions. And so it's important for entrepreneurs to recognize that. And to think critically and have a big picture view of things. 

So, a uniquely challenging and changing environment, means that we are again, doing new things. We're without the resources and relationships that established companies may have. 

We have high levels of complexity. And we want to think about the consequences that come to bear. 

So in summary, we hope to have, provide some tools and techniques to deal with some of these challenges within this course. We want to recognize that entrepreneurs are working in environments that are changing. And that with opportunity discovery, that's a central piece of where to start. The decision making is unique. Decision making is a significant task of entrepreneurs. We want to spend some time thinking about the motivations, thinking about the behaviors, thinking about the mindset of the entrepreneur and how to make smart decisions. And that's going to be the starting point, for your journey in entrepreneurship.