Entrepreneurship - Usefulness of Scott and Bruce Growth Model in the Firm - Assignment Example

B2B Company Start-up Report By Insert Presented to Location Due ASSIGNMENT Uplink Solutions Company Overview and Usefulness of Scott and Bruce (1987) Growth Model in the Firm Executive Summary Uplink Solutions is a (B2B) Business-to-Business company emphasising on providing consulting services and computing solutions, which are based on revolutionary technology as well as utilizing opportunities presented by Web-based applications. The company plans to utilize hi-tech hardware and software platforms in their computing facility. Uplink Solutions also provides web hosting, e-commerce solutions, customer training, web development, remote help desk support, and systems support. By looking in to the future, the firm aims to develop its unique B2B applications, which will be web-based (Rößler 2011). The company anticipates releasing its initial product in June 2015. Uplink Solutions is based on Cleveland, Ohio. The mission of the company is to offer enterprises with appropriate technology that they can use to allow them compete effectively in the web-based environment. By implementing high-tech equipment and offering appropriate technical enterprise, Uplink Solutions will manage to bring a fresh perspective to the B2B Technology Consulting market (Rößler 2011). Services Plan Uplink Solutions plans to provide to the market a broad range of service plans. Firstly, the company plans to offer Turnkey Business-to-Business Computing Solutions. Here, it will offer small to mid-size firms with computing solutions that are web-based while utilizing high-tech technology. For the hosting services, the company is anticipating to develop hosting services for ASP companies and realize more than $200,000 in revenue. In the case of internet sales, the company plans to generate at least $300,000 from hosting, web-development, and e-commerce solutions for small and mid-sized enterprises (Sam and Makor 2011). The computing solutions service will increase the computing sales revenue for the company from computer services, sales and support where it will generate approximately $450,000. In the case of web-based applications, Uplink Solutions will develop market as well as sell its own web-based B2B applications (Cann, et al. 2012). Marketing The marketing initiative that the company will rely on is based on the belief that the products and services it provides will represent a value-added strategy with respect to qualifying, interpreting, as well as comprehending the multifaceted prevalent in the computing industry as well as technology markets. For Uplink Solutions to manage to implement this strategy, it aims at placing paid advertising banners to certain key websites in the computing industry. The company also plans to utilize the opportunities offered by search engines as well as general advertising by the media in order to capture its general audience (Cann, et al. 2012). Management Uplink Solutions will employ top-class management professionals with sufficient knowledge in the computing industry, unique perspective in the B2B environment, and broad research experience (Fang 2008). The management team in the company includes the CEO, Mr. Jones Edward and the CIO, Mr. Jacob Manuel. Company Financials The initial $914,900 that the company anticipates to raise will be used to address office costs, staffing purposes, internet related costs, hardware and software computing equipment purchase. The company also anticipates gathering second round financing amounting to about $3 million, which will be used to facilitate in the development of B2B web-based applications as well as the company’s Educational Application Software (Fang 2008). The projected revenue by the company from 2015 to 2019 are $1 million, $15 million, $40 million, $72 million, and $95 million respectively. Mission and Vision Statement for the Company Within the next five years that Uplink Solutions will be in business, its mission will be to offer turnkey computing services, which will be based on state-of-the-art technology by employing web-based services as well as offer superior support and training to its clients in order to drive the firm’s infrastructure beyond the future (Bolton and Thompson 2013). Keys to Success The forces that will help the company to succeed in its future operations are as follows: Provision of strong technical support and training Enforce strong leadership by the managers of the company Provide high quality products, services and support to clients (Cassia, et al. 2006) Time plan for the first five years The following chart is an illustration of Uplink Solution’s time plan in terms of growth. Source: (Davila, et al. 2007) Practical usefulness of the Scott and Bruce (1987) small firm growth model to entrepreneurs with start-up firms during the first five years of their growth path (use examples) (1500 words) Practical Usefulness of the Scott and Bruce (1987) Small Firm Growth Model for Uplink Solutions The failure or success of an enterprise is forecasted by analysing the manner in which it is administered and the strategies adopted through the growth model it adopts. A research by Scott and Bruce (1987) showed that it is possible for a firm to evolve through five development stages. These include inception, survival, growth, expansion, and maturity (Welsch 2004). In the case of Uplink Solutions, the Scott and Bruce (1987) growth model will reveal the different stages that the company will go through and the different difficulties it will have to cope with as it evolves from its early stages of the model until it becomes mature and manages to expand further in future (Baldegger 2012). Small Business Concept Uplink Solutions is a small enterprise that aims at selling its technology products and services for money. The company requires investing and then seeking for customers who will purchase its products. As a small company, the total number of employees that the company can hire should not exceed 50 in the U.S. context, 15 in Australia, and 50 in the European Union (Davila, et al. 2007). In order for Uplink Solutions to fit in this criterion, it needs to focus on its total employees, annual turnover, all the overall value of its assets. According to Scott and Bruce (1987), the manager of a small business, such as Uplink Solutions serves as the owner of the firm. Moreover, an individual or a group funds most of the capital in the business (Davidsson, et al. 2010). Strategic Change The world today is always evolving, especially in the technological environment, meaning that change is inevitable. In this case, the owners of Uplink Solutions should never resist change but embrace it in order to remain competitive and relevant in the marketplace. The various ways in which Uplink Solutions will realize change in its operations will be through strategic and operational changes (Fayolle 2007). Here, the focus will be on what contributes to strategic change and the implications that result from the change. In the case of Uplink Solutions, it can embark on strategic change by aligning the setup of the business based on the changing environment. By configuring operational changes in its operations, the company will manage to cope with the changing business environment whereas strategic changes will renew the prevailing strategies (Bolton and Thompson 2013). The major actions that will constitute change in the case of Uplink Solutions is to reorganize the business in order to cope with the changing technological environment. It should also diversify in technology to help it redesign processes as well as adjust its project portfolio (Kemp and Verhoeven 2008). Five Stage Model When developing a business, it is appropriate for an organization to identify the different issues affecting its operations, products, and services. In the perspective of Scott and Bruce (1987), the problems that businesses encounter are similar when they are growing. In this case, the growth model stipulates that problems become more common as a business grows. These distinctive changes become evident based on the influence of certain traits (Johnson 2012). With regard to the different problems that businesses experience and the manner in which businesses grow, Scott and Bruce (1987) developed the five-stage model to elaborate the various problems that businesses experience. Every business enterprise has to undergo these stages as it is growing (Jones, et al. 2013). Since Uplink Solutions is a small business, it will undergo these processes to show the different processes that the company will go through during its operations in the technology sector. Higher chances of failure as a business is operating result when a crisis prevails in any of the stages of growth. It becomes severe when mishandled, particularly when the strategy implemented is not ideal in addressing the crisis. In case the crisis has been addressed, then the organization will manage to grow and reach to its next step. In this case, the company will grow further and reach the next stage (Tsang 2006). The various stages that Uplink Solutions will face until it reaches maturity are as follows. Inception Stage As Uplink Solutions is starting its operations, it should tailor its practices and often look for a one-size strategy that will fit its operations that will direct it towards realizing success. The company should understand that moving from an idea to a stable enterprise demands a constant flow of clients, mental fortitude and money (Baldegger 2012). This is particularly the case because the owner mostly serves as the source of funds for the company. In the case of Uplink Solutions, it is vital for the management of the enterprise to ensure that they have sufficient funds, resources, and appropriate strategies to help create room for the success of the business (Levy and Powell 2004). Survival Stage The survival stage reflects the potential of a business enterprise to establish a stable business that can remain stable to undertake its operations into the future. As a business reaches this stage, this means that it is a workable business enterprise. In the case of Uplink Solutions, therefore, it is appropriate for it to make fundamental capital as it expands and grows (Levy and Powell 2004). As such, the company should ensure that it should have sufficient funds to help it increase its inventories and receivables. In this case, the managers of the enterprise would be forced to contribute their personal finances and seek short-term loans in order to keep the business operational (Parker 2006). As the business is operating at this stage, it is uncertain about the level of competition. However, the operations that it undertakes are highly likely to attract a significant competitor base. In the initial stages of its operations, Uplink Solutions would realize that the barriers to entry are less common, meaning that the entry of new clients is simplified (Peter 2008). This poses challenges of entry to the market based on differentiation concept. As such, it is appropriate for the managers of Uplink Solutions to ensure that the measures they have set in place are feasible and that the business model they have implemented can allow it deliver its products, services, and solutions to attractive markets, which it managed to create in the previous stage (Tsang 2006). As such, the product line and services that the company offers will be specific to the growth possibility that result from the expansion of the market (Tansky, et al. 2006). Growth Stage As a business starts realizing growth after surviving the crises it encounters, it starts earning profit. In this case, it is appropriate for Uplink Solutions to reinvent the profit it has earned back into the organization to provide it with a larger financial base as well as capital resources (Steyaert and Hjorth 2005). In this case, the firm should hire a financial manager to handle the finances of the enterprise. In addition, since competition grows at a rapid at this state, the company should introduce other unique products to help it remain relevant in the marketplace (Tansky, et al. 2006). Expansion State In this state, it is vital for the firm to restructure as well as systemize a project management structure, especially because business politics become major issues for the organization to handle. In this case, it is appropriate for Uplink Solutions to embark on budgetary control, manage reports regularly, as well as decentralize its authority based on formal accounting systems (Tsang 2006). As such, the organization is forced to seek for long-term funds to help it attain a growth position. Rather than focusing on retaining earnings alone, the firm should introduce dividends in order to attract a pool of investors to help growth the business further. Moreover, long-term debts become a necessity, which help to expand the business, creating a need for the enterprise to provide security in form of the firm’s assets (Cassia, et al. 2006). Maturity Stage As Uplink Solutions approaches the outer edge where it would not be considered as no longer small, the business should still be considered as growing. Here, the major management issues that should be put into consideration include productivity, control, and search for additional growth opportunities (Sam and Makor, 2011). Here, the authority lines should be reorganized along product lines as well as be kept organized based on the functional lines of the firm. As such, it is true that the five-stage growth model by Scott and Bruce (1987) is an essential model to consider in the case of a small business, such as Uplink Solutions, as it would guide it on the appropriate strategies to follow during the various stages of growth (Parker 2006). ASSIGNMENT 2 How Uplink Solutions can use Personal Contact Networking to help achieve sales growth and the acquisition of necessary resources during the first five years of its growth plan Personal Contact Networking is essential in terms of helping enterprises to develop relationships that help them to collaborate with regard to realizing a competitive advantage in the marketplace. Therefore, as Uplink Solutions grows expands its operations, it will need to link with other related enterprises for it to expand its opportunities for growth. For instance, personal networks are essential in terms of developing effective relationships between the stakeholders of an enterprise, especially by using social networks (Davila, et al. 2007). Even though it has been revealed that it is possible for a business to realize gains by developing an effective personal network with its managers, clients, the community, businesses, and shareholders, little has been done with regard to constructing the social entity in the perspective of a small business, such as Uplink Solutions. This is needed because entrepreneurs encounter challenges with regard to determining how to develop a personal network that will help the company grow and acquire the necessary resources in the coming years (Fayolle 2007). This means that it is possible for the founders of the business to develop as well as use a personal networking environment that will help it get answers to the major issues that are presented to it by its peers (Johnson 2012). By constructing a peer-based network, it would be possible for Uplink Solutions to focus on delivering customized products and services to its clients in a timely manner. This form of intervention is appropriate because it helps businesses that avoid problems when providing programs that may lead to chaotic performance of the regional market (Tansky, et al. 2006). In most instances, it would not be possible for a firm such as this to understand the appropriate products and services to avail in the marketplace based on the operations that it undertakes. As such, it is crucial for Uplink Solutions to undertake research in this field to understand the appropriate contracts that it should develop for it to survive in the marketplace. It would be unwise for the management of the company to assume that an outside agent would be in a position to construct a personal contact network for the firm efficiently (Rößler 2011). Nonetheless, if it is possible for the business to realize the benefits of personal contact networking through persevering the prevailing risks, then it is true that this kind of a chance would help supplement the entire network of the organization. Personal Network Types Various forms of networks exist that Uplink Solutions should consider determining whether it would succeed in its operations. This way, it is possible for the firm to define the diverse business as well as social structures that prevail in the marketplace and determine the ones that are appropriate to implement. In a business environment, the term personal contact networking entails a general acceptance to an organizational structure where services serve as alternatives to the ways in which the market is organized. In this case, the forces in the market play a major role with regard to regulating interaction (Cann, et al. 2012). It also serves as a hierarchy where organizational managers and rules govern the prevailing interactions. The common forms of networks include inter-organizational networks and the entrepreneur’s personal network. An inter-organizational network reflects the arrangements that two firms make with regard to realizing certain business goals and objectives. The entrepreneur’s personal network comprises of a set of relationships that link a group of individuals based on the different forms of exchanges they practice (Steyaert and Hjorth 2005). The entrepreneur’s personal network and inter-organizational networks overlap naturally. In this case, it is appropriate for Uplink Solutions to focus on implementing the two concepts in its operations for it to build lasting relationships with its stakeholders, which can help it develop strategies for introducing competitive advantages into its future operations (Tansky, et al. 2006). Personal Contact Network Objective A personal contact networks differ in both purpose and benefits they deliver. In the case of inter-organizational network, Uplink Solutions can use it to meet its business objective, increase sale and profitability, share risks, collaborate with regard to product development, access new technologies and markets, and speed product development and introduction into the market. Moreover, it would be possible for the company to form personal contacts for additional reasons, though a broader perspective is prevalent (Levy and Powell 2004). For instance, research reveals that it is possible to recognize personal networks based on the capacity of an entrepreneur to extend an individual’s asset base of social, human, market, technical and financial capacity. In this case, there are two major ways of extending the asset base for Uplink Solutions in order for it to realize continued growth in the initial five years of its operations. It can do this by providing specific services and support to its clients and other stakeholders in the marketplace. In this case, the entrepreneurial and inter-organizational personal contacts differ (Tansky, et al. 2006). For instance, entrepreneurial network provided psychological and developmental support in addition to material service. Here, the entrepreneurs are encouraged by their peers and understand that the problems they encounter are also faced by their colleagues. They also need to increase learning as well as the ability to cope with the changing competitive environment (Peter 2008). As such, it would be possible for Uplink Solutions to understand the need for collaborating with other firms in order to share their experiences based on the ways in which to avoid the inherent risks in the marketplace (Cassia, et al. 2006). Since Uplink Solutions is a start-up company, it is vital for it to construct a personal contact network in order for it to realize material, psychological, as well as developmental benefits. In this case, it should embark on extending contacts, share information. Introduce new peers, motivation, support, revolutionary products and ideas, and encouragement (Davidsson, et al. 2010). As such, it would manage to introduce strategies in the marketplace, which can help it develop tremendous competitive advantage and revolutionary strategies that would help it undertake its operations in a smooth manner in the coming years (Welsch 2004). The operations that Uplink Solutions embarks on are driven towards developing networking capabilities and networking in order to excel in the market. Therefore, the company should dwell on inter-organizational network as well because it is a high-technology sector. This would add benefits to its entrepreneurial network model. As such, it would helpful for the company to identify major investment innovative activities or outcomes that can help it emerge successful in multiple sectors, which can help it gain considerable benefits from networking (Cann, et al. 2012). Personal Contact Network Setup Approach An organization adopts different approaches when implementing the diverse forms of personal networks in an enterprise. For instance, the strategic aspect of inter-organizational networks defined based on the ties that a company ensures while trying to realize competitive advantage. The strategic aspect in this case implies a proactive nature in terms of seeking competitive advantage by joining efforts with others (Cann, et al. 2012). ` There is lack of consensus with regard to whether entrepreneurs develop personal networks in a strategic manner. Various studies reveal that there is proactive as well as deliberate approach with regard to building personal networks in an enterprise. Others stipulate that entrepreneurial networks are built in a passive, unconscious manner and are not practiced while planning for networking initiatives. Research has shown that personal networking initiatives may be largely unstructured as well as coincidental in nature regardless of whether the entrepreneurs use their networks in a proactive manner (Baldegger 2012). When building personal networks, the process becomes fluky as it is based on trial and error. This happens when an entrepreneur introduces individuals to his network without understanding whether they are capable of helping to develop the asset base of the firm. This can lead to uncertainties with regard to the operations of the firm, leading to deteriorating performance. In this case, it is appropriate for Uplink Solutions to evaluate the traits of individuals it aims to develop personal networks with to know whether they have the potential of contributing to the success of the organization (Cann, et al. 2012). It should do this by researching on different kinds of individuals and other enterprises to develop relationships with in order for it to develop a knowledge and strategy base where it can realize potential for future growth (Fang 2008). After the firm engages with the right individuals, it can realize that entrepreneurs do not network with extensively with firms services that prevail specifically to address the needs of small businesses. In this case, businesses perform poorly due to entrepreneur’s lack of time as well as perceived poor service. Therefore, since networking is vital in an enterprise, although entrepreneurs lack the potential to develop an elaborate network, it is essential to create programs for intervention (Baldegger 2012). In this case, it is appropriate for Uplink Solutions to create an intervening strategy that would help it reduce unstructured (coincidental) nature affiliated with personal networks, and one that would work efficiently with time constraints that entrepreneurs experience (Davila, et al. 2007). Framework for Developing Personal Contact Networking Entrepreneurs as whether it is possible to develop a personal contact network as part of their role to realize benefits rather than risks. The framework that is appropriate with respect to developing a personal contact network for Uplink Solutions is as shown in the table below. It shows the diverse benefits that the company will experience in the coming years by implementing personal contact networks in its operations (Levy and Powell 2004). Environment: Goodwill, trust, fostering networking, and facilitating timelines of information. General Benefits Innovation benefits Sharing of information Extending contacts Introduction of additional peers Encouragement, support, and motivation Product and service ideas Quality improvement Improvement of marketing properties for particular products and service Reduction of costs Improvement of production processes Source: (Davila, et al. 2007) From the table, it is true that the Uplink will realize various benefits after developing personal contact networks with clients and other firms in the marketplace. The company can share innovation information with its clients and business colleagues to determine the appropriate products to introduce to the market. The company can also manage to extend its contacts, growing its client base. Moreover, networking with peers, the company would receive motivation, encouragement, and support based on the ideas, products, and services it introduces to the market. Furthermore, the company would manage to introduce high quality products in the market, which would incorporate marketable properties that would encourage clients to use its products. Additionally, the company would manage to reduce its operational costs as well as improve production processes thereby allowing it to attain a competitive position in the marketplace. This would help the company to realize undisputed growth in future years of operation. Reference List Baldegger, R 2012, Management in a Dynamic Environment: Concepts, Methods and Tools. New York: Springer Science & Business Media. Bolton, B & Thompson, J 2013, Entrepreneurs: Talent, Temperament, Technique. London: Routledge. Cann, R, Jansen, S & Brinkkemper, S 2012, Software Business Start-up Memories: Key Decisions in Success Stories. London: Palgrave Macmillan. Cassia, L, Fattore, M & Paleari, S 2006, Entrepreneurial Strategy: Emerging Businesses in Declining Industries. New York: Edward Elgar Publishing. 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