POSSIBLE EXAM SCOPE

Study Unit 1 – 10 Points (Chapter 1 in TB)• Name 5 key company capabilities(Ref: 8 TB) (Appeared in May/June 2012 4.2,) (Also in Ass 1/Q1) (5 Point)

Adaptability ­ The ability to adjust, on a timely basis, to new technologies, new customer needs,new regulatory rules, and other changes in conditions without losing focus or causing significantdisruption of core operations and commitments.

Flexibility ­ the ability to design company strategies, processes, and operational approaches thatcan simultaneously meet the diverse and evolving requirements of customers, distributors,suppliers, financiers, regulators, and other key stakeholders.

Speed ­ The ability to act quickly on emerging opportunities; to develop new products and servicesmore rapidly, and to make critical operational decisions without lengthy deliberations.

Aggressiveness ­ An intense, focused, and proactive approach to eliminating competitors,delighting customers, and growing employees.

Innovativeness ­ A continuous priority placed on developing and launching new products, services,processes, markets, and technologies, and on leading the marketplace.

• Explain Griener’s organisational life cycle stages.(Ref: 16­17 TB) (Appeared in May/June 2012 Q1.3; Oct/Nov 2010 Q1.3; Oct/Nov 2012 Q1.3;)(Also in Ass 1/Q2)

Start Up and Early Growth ­ The launching of a venture and the initial penetration of the market. Growth through Direction ­ Management puts the necessary systems and structures in place,

and augments the leadership team with the functional area professionals, another period ofsustained growth ensues.

Growth through Delegation ­ Takes the form of creating semi­autonomous product divisions andstrategic business units.

Growth through Coordination ­ Centralizing operations. Head office staff is developed tocoordinate marketing, human resource management, production, research and development,information technology, and other operations across the various divisions and operating units.

Growth the Collaboration ­ Companies simplify structures and procedures, reduce head officestaff, reassign staff experts to consulting teams assisting field operations, create matrix structures,encourage experimentation, and emphasize innovative projects involving cross­functional teams.

• Define Entrepreneurship(Ref: 9 TB, 6 SG) (Appeared in Oct/Nov 2012 Q2.2.1)

The process of creating value by bringing together a unique combination of resources to exploit anopportunity

• Give 5/7 perspectives on the nature of Entrepreneurship(Ref: 10 TB)

Creation of wealth – involves assuming the risk associated with the facilitation of production inexchange for profit

Creation of enterprise – entails founding of a new business venture where none existed before Creation of innovation – concerned with unique combination of resources that make existing

methods or products obsolete

Creation of jobs – concerned with employing, managing and developing the factors of production,including the labour force

Creation of value – process of creating value for customers by exploiting untapped opportunities Creation of growth – defined as a strong and positive orientation toward growth in sales, income,

assets and employment

• Explain why companies lose their Entrepreneurial way (the Organizational lifecycle)(Ref: 16­17 TB) (Appeared in May/June 2012 Q1.3; Oct/Nov 2010 Q1.3; Oct/Nov 2012 Q1.3;)(Also in Ass 1/Q2)

Start up and early growth Encompasses the launching of a new venture and the initial penetration of the market. Highly creative Work environment in early stages is exciting, stressful, demanding, and uncertain. Organisation run informally Employees feel they part of something CRISIS: Greater size requires more professionalised management

Growth through direction Companies fail because they will not formalise so Management put necessary systems

and structures in place, and augments the leadership team with functional areaprofessionals

Another period of sustained success growth ensues. CRISIS: demand for greater autonomy on the part of lower level managers and employees

Growth through delegation Delegation takes form by creating semi­autonomous product divisions and strategic

business units Organisational targets are given to achieve. Senior management focuses on major strategic moves and acquisitions CRISIS: Management lose control over highly diversified field operation, duplication of work

efforts Growth through coordination

Companies respond to this loss of control by centralising operations. Head office staff is developed to co­ordinate operations CRISIS: Centralisation over times tends to breed bureaucracy and a crisis of red tape

eventually occurs. Myrid of procedures and systems will be developed that exceed their utility Procedures take precedence over problem solving

Growth through collaboration Very nature of the enterprise has to be reinvented by transforming the machine bureaucracy

into an innovation factory Companies must simplify structures and procedures, reduce staff Creation of matrix structures, encourage experimentation in all facets of the business

Study Unit 2 – no Questions

Study Unit 3 – 6 Points (Chapter 3 in TB)• Name the Dimensions of Entrepreneurship

Innvativeness Risk Taking Proactiveness

4 innovation types and their risks: Discontinuous innovation: breakthrough innovation addressing a new need eg. Cell phone,

high risk Dynamically continuous innovation: dramatic improvement over existing solution that is not

disruptive eg. Electric tooth brush, moderate risk Continuous innovation: incremental innovation enhances existing products with new

features eg light bulb that burns longer. Companies devote to this type the most, moderaterisk

Imitation – copying competitors, high risk

• Describe the degree & Frequency of Entrepreneurship of a company

Degree of EntrepreneurshipThe extent to which events are innovative, risky and proactive.E.g. a firm adopts a radically different (high innovativeness) and unproven (high risk) production technology,yet lags behind the industry leaders (low Proactiveness)

Entrepreneurial Intensity: combining degree (domains) and frequency of Entrepreneurship

The degree of entrepreneurship refers to the level or extent to which each of the dimensions, innovativeness,risk taking and proactiveness occurs in the organisation and can be related to technological change. Thefrequency of entrepreneurship refers to how many entrepreneurial events take place within a given period oftime and can be related to the intensity of competition. If the degree of entrepreneurship and the frequencyof entrepreneurship are combined, we can measure the intensity of entrepreneurship in the organisation.Fig3.5 tb 75

Companies that display a low degree and frequency of entrepreneurship are periodic/ incremental inentrepreneurial intensity.

Companies that display a low degree and high frequency of entrepreneurship arecontinuous/incremental in entrepreneurial intensity.

Companies that display a high degree but low frequency of entrepreneurship areperiodic/discontinuous in entrepreneurial intensity.

Companies that display a high degree and frequency of entrepreneurship are revolutionary inentrepreneurial intensity.

Companies that display an average degree and average frequency of entrepreneurship are dynamicin entrepreneurial intensity.

Study Unit 4 – 6 Points (Chapter 4 in TB)

Name 4 Pure types of Corporate Venture Capital Investments Driving investments: (strategic rationale with tight operational links between start­ups and

existing company) Enabling investments: (strategic rationale with loose operational links) Emergent investments: (financial rationale and tight operational links) Passive investments: ( financial rationale for investments with loose operational links)

• Corporate Entrepreneurship takes different forms, namely Corporate Venturing & Strategic Entrepreneurship. Discuss the different forms.(Ref: 86,100 TB) (Appeared in May/June 2012 Q2.2; Oct/Nov 2010 Q4.2; Oct/Nov 2011 Q1; May/June 2010 Q1.1,May/June 2011 Q1.3)

Corporate Venturing ­ Includes various methods for creating, adding to, or investing in newbusinesses. The different types include:

Internal corporate venturing ­ create and own new business Cooperative corporate venturing ­ Create new businesses and own together with external

development partners External corporate venturing ­ new business are created outside the company and

subsequently acquired by the company Strategic Entrepreneurship (100 TB/ 32 SG) ­ Corresponds to a broader array of entrepreneurial

initiatives that do not necessarily involve new business being added to the firm. Strategic renewal ­ Seeks to redefine its relationship with its markets or industry

competitors by fundamentally altering how it competes. Sustained regeneration ­ The firm regularly and continuously introduces new products

and services or enters new markets. Domain redefinition ­ The firm proactively creates a new product­market arena that others

have not recognized or actively sought to exploit. Organizational rejuvenation ­ The firm seeks to sustain or improve its competitive

standing by altering its internal processes, structures, and/or capabilities. Business Model reconstruction ­ The firm applies entrepreneurial thinking to the design or

redesign of its core business models in order to improve operational efficiencies.

• Discuss Open Innovation Revolution (Innovation Model) 4 Reasons(Ref: 108 TB, 33 SG) (Appeared in Oct/Nov 2012 Q2.2)

Importing new ideas is a good way to multiply the building blocks of innovation ­ That is byaccessing external inputs to innovation firms can potentially offer more and better innovativeoutputs.

Exporting ideas is a good way to raise cash and keep talent ­ A company’s innovative ideascan have market value that is exploitable through its sale to outside customers.

Exporting Ideas gives companies a way to measure an innovation’s real value and toascertain whether further investment is warranted ­ Offers to sell internally developedinnovative ideas to external markets can be litmus tests for the true value of an idea.

Exporting and importing ideas helps companies clarify what they do best ­ Collaborativeefforts, the purchase of innovations or inputs to innovations from others, and others to sell the firmsinnovations or inputs to innovations to others can reveal where a firm's real bases for competitive

advantage lie.

Study Unit 5 – 6 Points (Chapter 8 in TB)• Name the perspectives of a successful creativity in Organizations

Expertise What you know and can do The intellectual space used to solve problems

Motivation Extrinsic: Desire to achieve company rewards Intrinsic: passion and interest

Creative thinking Ways in approaching problem solving Techniques used at looking at problems differently

• Discuss the creative process(Ref: 42 SG / 216­219 TB) (Appeared in May/June 2012 Q3.2; Oct/Nov 2010)

Preparation ­ The creative process begins with a problem or challenge which is defined at thisstage

Frustration ­ At this stage a solution to the problem is sought, but a solution may be difficult tocome by because of creative blocks.

Incubation ­ Refers to placing the problem “at the back of your mind” where you would consciouslytry to find a solution or work through a problem.

Illumination ­ This is the “aha” moment when you discover a solution to the problem Elaboration ­ At this stage the solution is refined, adapted, expanded and tested.

• Is the innovation always a linear process?(Ref: 219 TB) (Appeared in Oct/Nov 2010)

No ­ It changes all the time. There may be points of incubation throughout, some lasting long, someshort. There may be feedback loops. There may be little “Eureka Moments” along the way, insteadof one illumination stage.

• Discuss the arenas in which creative people work (14 Points)(Ref: 216 TB) (Appeared in Oct/Nov 2011 Q4.1)

Idea Creativity ­ Thinking up new ideas or concepts Material Creativity ­ inventing or building a tangible object Organization Creativity ­ organizing people of projects Relationship Creativity ­ innovative approaches to achieving collaboration, cooperation, win­win

situations Event Creativity ­ producing an event or occasion Inner Creativity ­ changing one’s inner self. Spontaneous Creativity ­ acting in a spontaneous manner

• Name the blocks (sources) to the creative process

Blocks to creativity originate from three sources: self­imposed blocks, that is, the employee may believe that he/she is not creative creative blocks imposed by other employees, that is, other employees may indicate that a certain

employee could never be right, or that what he/she proposes is not logical Creative blocks imposed by the organisation, for example, the organisation may not tolerate failure.

Once the creative blocks are removed, the creative employee can avail himself/herself of a number ofproblem­solving styles and creative techniques to develop new ideas.

• Discuss the standard to judge quality of creativityThe following three standards for judging the quality of an individual’s or group’s creativity:

Obvious benefit. To what extent does the idea have a clear benefit or advantage for thecustomer/user?

Reason to believe. What supporting evidence is the employee able to provide? Is the customer/userlikely to believe that the concept or idea will deliver the same level of benefits?

Dramatic difference. How different is the idea from conventional solutions?

• Discuss 6 Characteristics of Entrepreneurial Personality Achievement motivation Strong internal locus of control Calculated risk taker Tolerance of ambiguity Degree of autonomy when accomplishing a task Tenacious and demonstrate significant perseverance

• Name the different types of EntrepreneursFour different types of CE’s exist that have different approaches to entrepreneurship

The Personal Achiever High need for achievement Need for performance feedback Desire to plan and set goals Strong individual initiative Strong personal commitment Internal locus of control Work should be guided by personal goals, not others

The super salesperson Empathise with others Desire to help others Believes in social process and interaction and relationships

Needs strong positive relations with others Believes sales force is crucial to carrying out strategy Background in sales

The real Manager Desire to be a corporate leader Desire to compete Decisiveness Desire for power Positive attitudes to authority Desire to stand out from the crowd

The Expert Idea Generator Desire to innovate Loves ideas, curious, open minded Believes new product development is crucial to strategy Good intelligence, thinking centres entrepreneurial approach Intelligence as a source of competitive advantage Desire to avoid taking risks

• Name the Critical Roles in Corporate Entrepreneurs Initiator

Triggers the new event, recognises the opportunity Normally filled by the champion

Sponsor/facilitator Sponsor of the initiative Pushing for its acceptance Major advisor and mentoring role in protecting initiative Acts as a buffer protector and modifier of rules and policies that help the venture obtain

resources Champion

Drives the project Oversees implementation process Adapts key concepts along the way to bring project to completion

Innovative midwife Translator between the language, culture and needs of the sponsors world with the

language, culture and needs of the champions world Nurtures innovations that might be rejected by the organisations core

Supporter Augments the team Secondary role providing expertise

Reactor Devil’s advocate Provides market intelligence and insights that serve to either pinpoint weakness in the idea

or ways in which it should be revised or refined

• Name the myths about Corporate Entrepreneurs

PrimaryMotivation

∙ Myth: The primary motivation of corporate entrepreneurs is a desire for wealth; hence,money is the prime objective.

∙ Fact: The primary motivation of corporate entrepreneurs is the process of innovation: Thefreedom and ability to innovate are the prime motivators. Money is only a tool and a symbol ofsuccess.

RiskTaker

Myth: Corporate entrepreneurs are high risk­takers­they are gamblers who play for highstakes.

∙ Fact: Moderate risk­taking is a more realistic description of the corporate entrepreneur’sactions. Because of their insatiable desire to achieve, smaller, calculated, and analysed risksare the preferred stepping­stones of these individuals.

AnaliticalSkills

∙ Myth: Because corporate entrepreneurs lack analytical skills, they “shoot from the hip.” Thishas led to a philosophy of “luck is all you need.”

∙ Fact: Corporate entrepreneurs are fairly analytical. Although it may appear they are luckyand shoot from the hip, in truth, they are well prepared, understand innovation, and perceivemarket needs very well.

TeamPleayer

∙ Myth: Corporate entrepreneurs do not appreciate the importance of being a team playerwithin the company, and often act as the proverbial “bull in a china shop.”

∙ Fact: Corporate entrepreneurs often demonstrate strong political skills and are adept atworking around rules, procedures, and constraints imposed by the company hierarchy withoutstepping on toes; they develop their innovative concepts “below the radar screen.”

Ethics ∙ Myth: Corporate entrepreneurs lack morals or ethics due to their strong desire to succeed.They do not care how they succeed, just as long as they do succeed.

∙ Fact: In today’s demanding, educated, and critical society, where companies and theiractions tend to be visible to the public, corporate entrepreneurs tend to be highly ethical andhave moral convictions consistent with society’s expectations. If … they do not have theseconvictions, they do not survive.

PowerHunger

∙ Myth: Corporate entrepreneurs have a power­hungry attitude and are most interested inbuilding an empire. They want the venture to grow as big and as fast as it can.

∙ Fact: Most entrepreneurial initiatives are small and relatively conservative. The individual is

more interested in the profit and growth of the concept or venture than in empire building. Thefocus is on doing things right rather than doing them big.

Study Unit 6 – 10 Points (Chapter 9 in TB)• Discuss the 5 General Human Resource Categories (I dropped this Question

• Discuss how HR can improve Corporate Entrepreneurial Job planning and design

The idea is to give employees broadly defined job­related tasks with more decision­makingdiscretion.

Once a person has been appointed to the organisation, staffing practices are designedaround broad career paths and multiple career ladders for the employee, which provideexposure to more areas of the organisation. This exposure enhances idea generation andproblem solving.

A person should not be selected for a task or an entrepreneurial team on the basis of pastexperience – selection should be more open. Open selection allows for self­selection toentrepreneurial positions, hence a better match between the entrepreneurial requirements ofthe organisation and the individual’s needs.

Recruitment and selection This includes the need to create an entrepreneurial culture, together with the need to recruit

externally and increase the importance of employee orientation and socialisingprogrammes.

Training and development Changing job elements and the need to keep abreast of the latest technology create the

need for continuous training. Training should be unstructured and unstandardized, andshould focus on the individual’s knowledge requirements. This type of training allowsindividuals to respond to new challenges in unique ways, and to adapt to environmentalchanges.

Training should also include entrepreneurial skills such as navigating through organisationalpolitics, ways to obtain sponsors and building resource networks.

Employee performance evaluation Entrepreneurship is fostered where performance evaluations and discretionary

compensation are based on long­term results and a balance between individual and groupperformance is maintained.

Performance appraisals should measure outcomes or results, rather than the methods thatwere employed to achieve the results, since entrepreneurship sometimes requiresemployees to secure resources in novel and innovative ways.

Compensation and rewards Entrepreneurial individuals display a pronounced need for achievement and also require

rewards for their efforts. Employees should be involved in setting high performancestandards and designing rewards systems.

Employees could be given different types of holiday (local or overseas) for proposing newideas.

They could be given the option to buy shares in the business for developing and

implementing a profitable product. They could win awards in the form of prizes on the company’s awards day. They could be promoted to manager of that particular product division. The company could start an awards programme whereby staff can earn points for different

types of innovative behaviour. They can then redeem the points to buy computers trainingcourse tuition, or other rewards.

Reasons why employees might not be motivated to act entrepreneurially in his/her job. These reasons arerelated to

effort expectation the effort–performance relationship the performance–reward relationship the nature of the rewards

• Define technology and explain the role it plays.(Ref: 162 TB) (Appeared in Oct/Nov 2010 Q2.1)

Technology can be defined as the tools, devices and knowledge that help transform inputs intooutputs. The role is that technology is an important trigger for entrepreneurial activity withincorporations, in that it represents both opportunity and threat.

Study Unit 7 – 4 Points (Chapter 6 in TB)• Give reasons why Entrepreneurship is connected to strategy (changing landscapes)

changing landscapes. They are filled with chaos, complexity, contradiction and change:

ChangeNo organisation is immune to immense pressure of change. In the past the playing field was level, if not totheir advantage. The rules were obvious and structure was the manager’s friend. Hierarchy provided contextand orientation. There was always sufficient time. Today’s environment is nothing like the past. Uncertaintyis common place.ComplexityComplexity is another critical force in the new landscape. Change comes from many different directions,often at the same time. There are new markets, technologies, economic realities, demographic patterns etc.customer groupings are shifting and becoming more differentiated. Competitors come and go. Further,change in one area interacts with change in other areas. The net effect is that there is more change tomanage and it is much more complex!ChaosThe common language meaning of term chaos is confusion, and confusion describes the new businesslandscape. Random events can cause extreme consequences in business. Small changes or shocks to thesystem, in which the business operates, can have a major impact on the business itself.ContradictionFinally, the business environment is filled with many contradictions, and dealing with paradox becomes acritical aspect of managing the new competitive landscape.Not 1 or another but rather 1 and another. Embrace it and accept ambiguity

• Discuss technology push vs. Market pullOrganisations usually have a technology­push and/or market­pull orientation to innovation.With technology­push, employees try to find technological possibilities and develop products based onthem. They focus on the technology and assume that the market will want the product.Market­pull approaches to innovation, on the other hand, start with customers’ needs. Customers are thesource of new product ideas and their input is instrumental in the design and development of products.Usually technology push approaches result in breakthrough innovation – both discontinuous anddynamically continuous innovation. But these innovations may not be what customers want.Market­pull approaches result in incremental advances – both continuous innovation and imitation. However,these innovations usually have short­term pay­offs. Management should ensure that there is a matchbetween technology­push and market­pull innovation. Technological possibilities have to be explored withinthe limits of understanding customer segments and customer needs now, and in the future.

• Name the contributing factors to Entrepreneurial Strategy

• Name flaws or Fatal visions regarding Implementation Issues(Ref: 178­179 TB / 63 SG) (Appeared in May/June 2012 Q2.1; May/June 2011 Q2.1)

Misunderstanding industry attractiveness ­ Attractiveness does not always mean a businesswho is growing rapidly, appears to be glamorous or uses the fanciest technologies. It has to do withhigh barriers to entry, ability to influence suppliers and customers, the ability to differentiate. Themore glamorous, the more likely new competitors will enter.

No real competitive advantage ­ Merely copying, imitating, or slightly improving upon the strategyof competitors.

Pursuing an unsustainable competitive position ­ Companies try to be customer serviceleaders when customer service innovations are easy to mimic; they attempt to be technologyleaders when they do not have the necessary internal capacity to continually produce desirabletechnical innovations.

Compromise strategy for growth ­ Pressure exist for companies to maximise sales growth, whichoften means capitalising on short­term opportunities that are inconsistent with or distractmanagement from the other core strategy.

Failure to explicitly communicate strategy internally ­ Companies can’t assume thatemployees know the strategy or understand the implications for how they deal with particularsituations.

Study Unit 8 – 14 Points (I believe this will be a 10 and 4 point Question)(Chapter 7 in TB)• Define a structure and discuss how the types of structures can influence the strategy of a company.(Ref: 184­185 TB / 68 SG) (Strategy: 188 TB) (Appeared in May/June 2012 Q3.3; Oct/Nov 2009 Q1.1;May/June 2010 Q6.1; Oct/Nov 2011 Q6.1)

Organisational structure is defined as the arrangement of workflow, communication and authority

relationships with an organisation. Simple Structure ­ Highly informal with coordination of tasks accomplished by direct

supervision. All strategies determined from the top. Machine Bureaucracy ­ A mechanistic and rigid structure in which coordination of tasks

is achieved through standardization of work. It is hierarchical and very bureaucratic. Organic ­ Limited hierarchy and highly flexible structure Divisional ­ Self­Contained profit centers exist for producing and marketing different

product lines or groups.

• Discuss 4 major policy Areas(Ref: 185­186 TB)In designing the organisational structure, four major policy areas are considered

Specialisation Number and types of specialties to be used in performing the work of the company More specialisation means more specific tasks and leads to integration issues Discontinuous or dynamically continuous innovations require more specialisation than

continuous and imitation innovations Shape

The number of people forming departments in each area at hierarchical levels More people in a department requires fewer levels More people implies a broader span of control while fewer levels means the organisation is

flatter Flatter structures result in better communication and faster decision making, greater

delegation of responsibility. Hierarchical structures tend to rely on power to settle issues rather than debate

the distribution of power occurs vertically and horizontally vertically, power is concentrated in the higher levels, suggesting more centralised structure

or it can be pushed down in the organisation empowering lower levels to make decisions decentralised structures are consistent with the encouragement of individual initiative,

experimentation and innovation but it’s hard to control all the individual efforts and see ifthey are in line with the strategic direction

departmentalisation forming people into department’s, groups and areas once the organisation reaches a certain

size normally grouped according to functions

• Name the Types or Structures that enhance Corporate EntrepreneurshipFour types of structure

Simple Structure Highly informal with coordination of tasks accomplished by direct supervision Strategies determined at the top Little space for specialisation of tasks

No rules, procedures Little bureaucracy, simple information systems and little integration needs Work well in small rapid growth ventures operating in fragmented industries

Machine Bureaucracy Rigid structure Coordination of tasks achieved through standardisation of work Hierarchical and bureaucratic Formal guidelines and plans in place Large techno structure exists to design and plan operations Technology is integrated into operations Power is among top executives Work well in stable predictable environments, produce high volumes efficiently

Organic Limited hierarchy and flexible structure Groups of trained specialists from different work areas collaborate to design and produce

rapidly changing products Emphasis is on person interaction and face to face communications Decentralised power and authority is linked to experts Few rules Facilitate the ability of entrepreneurial strategies to enhance financial performance

Divisional Self­contained profit centre for products and marketing lines Can differ from one another in structure Pressure to conform and formalise standards and procedures Operate independently and become bureaucratic over time Decision making authority at divisional managers Controlled by complex information management systems Communication is via head office

• Name the benefits of having mechanisms for generic Innovations

• Name the possible Organization Designs StructuresThe possible organization designs or structures include:

Direct integration (high strategic importance, strong operational relatedness): The entrepreneurialinitiative is pursued within the mainstream operations of the corporation.

New product/business department (high strategic importance, partial operational relatedness): Aseparate department for the entrepreneurial initiative is created in that part of the corporation(division or group) where significant potential exists for sharing capabilities and skills.

Separate business units (high strategic importance, low operational relatedness): A speciallydedicated and operationally distinct unit is created inside the corporate structure to house theentrepreneurial initiative.

Micro new ventures department (uncertain strategic importance, strong operational relatedness):An organizational unit is created where autonomously emerging entrepreneurial initiatives are

pursued without the constraint of currently having to fit with the corporation’s strategy. New venture division (uncertain strategic importance, partial operational relatedness): An

organizational division is designed to house a wide range of potentially interesting entrepreneurialinitiatives that are of ambiguous fit with the corporation.

Independent business units (uncertain strategic importance, low operational relatedness): Aspecially dedicated and operationally distinct unit is created outside the corporate structure tohouse the entrepreneurial initiative.

Nurturing plus contracting (low strategic importance, strong operational relatedness): Thecorporation’s knowledge and competencies are leveraged in entrepreneurial initiatives that aremoved outside the corporate structure (e.g., outsourcing some part of the entrepreneurial project)and in which that knowledge or those competencies constitute strategic assets for the initiative.

Contracting (low strategic importance, partial operational relatedness): The corporation’sknowledge and competencies are leveraged in entrepreneurial initiatives that are moved outside thecorporate structure (by contracting to some outside organization) and in which that knowledge orthose competencies add some value to the initiative’s operations.

Complete spin off (low strategic importance, low operational relatedness): The total separation ofthe entrepreneurial initiative from the corporation.

Study Unit 9 (10 Points)• Explain the key elements of the human resource management (10 Points)(Ref: 249 TB, 50 SG) (Appeared in May/June 2011 Q1.1)

Jon planning and design ­ Reliance on formal planning, long term orientation in planning and jobdesign, implicit job analysis, Jobs that are broad in scope, Jobs with significant discretion, Jobsthat are less structured, Integrative job design, results­orientated job design, high emplyeeinvolvement in designing jobs

Recruitment and Selection ­ Reliance on external and internal candidates when hiring, innovativeapproaches to finding employees, broad career paths, multiple career ladders, general, implicit, lessformalized selection criteria.

Training and development ­ Long term, career­oriented training, training with broad applications,individualized training, high employee participation, unsystematic training, emphasis onentrepreneurial skills, continuous/ongoing training.

Employee performance and evaluation ­ High employee involvement, balanced individual­grouporientation, emphasis on effectiveness over efficiency, result oriented, based on subjective criteria,reflects tolerance of failure, appraisals done based on project life cycle

Remuneration and reward ­ Emphasis long­term performance, decentralized at division ordepartment levels, tailored to individual, emphasizes individual performance with incentives for groupefforts, merit­and incentive­based, significant financial reward, based on external equity

10 – No Questions

Study Unit 11 – 10 Points (Chapter 12 in TB)• Discuss the role played by top level managers(Ref: 95 SG) (Appeared in May/June 2012 Q4.4, Oct/Nov 2012 Q2.3)

Top Ratifying ­ that is, articulate strategic intent, monitor, endorse support Recognizing ­ that is, recognize strategic potential, set strategic direction, empower and

enable Directing ­ that is, plan, deploy resources, command

Middle Championing ­ that is, nurture and advocate, champion, present alternatives to top

management Synthesizing ­ that is, categorize issues, sell issues to top management, blend strategic

and hands­on information, synthesize Facilitating ­ that is, nourish adaptability and shelter activity, share information, guide

adaption, facilitate learning Implementing ­ that is, implement, revise and adjust, motivate and inspire, coach

• Discuss the Entrepreneurial Imperatives of Strategic Leadership(Ref: 327 TB) (Appeared in Oct/Nov 2012 Q1.2)

Nourish an Entrepreneurial Capability ­ Invest in the development of an institutionalizedorganisational capacity for innovation and entrepreneurship.

Protect Disruptive Innovations ­ Selectively protect the innovations that seem disruptive orthreatening to the organizations mainstream operations by “cocooning” them in their infancy.

Make opportunities make sense ­ Expand the opportunity “radar screen” such that personnelcan recognize and appreciate the hidden opportunities associated with their jobs

Question the Dominant Logic ­ Challenge conventional strategic practices, norms, and mindsetssuch that innovation is not hampered by tradition or other social or psychological constraints.

Revisit the “Deceptively Simple Questions” ­ Identify growth opportunities through re­askingbasic questions such as “What business are we in?” and “What do our customers value?”

Link Entrepreneurship and Strategy ­ Integrate the entrepreneurial and strategic processes ofthe organization to facilitate the recognition and exploitation of strategically significant opportunitiesfor innovation.

• Name the Managerial RolesSpecific managerial roles at the three levels of management can be associated with each of these fivestrategic entrepreneurship forms.

Top management roles Ratifying: articulating the strategic intent, monitor, endorse and support Recognising: recognise strategic potential, set direction and empower and enable Directing: plan and deploy resources on command

Middle level management roles Championing: nurture and advocate, present alternatives to top management Synthesizing: categorise issues, sell issues to top management, blend strategic and hands

on information

Facilitating: nourish adaptability and shelter activity, share information and guideadaptations

Implementation: implement, revise and adjust, coach and inspire Operating management roles

Experimenting: learning and improving, linking technical ability and need, initiateautonomous initiatives, experiment and take risks

Adjusting: respond to challenges Conforming: be a good soldier and follow the system

• What is entrepreneurial strategy?(Ref: 153 TB) (Appeared in Oct/Nov 2012 Q1.1)

Entrepreneurial strategy is a vision­directed, organization­wide reliance on entrepreneurial behaviorthat purposefully and continuously rejuvenates the organization and shapes the scope of itsoperations through the recognition and exploitation of entrepreneurial opportunity.

Study Unit 12 – 8 Points (Chapter 14 in TB)• Step II is the Entrepreneurial Health Audit is Diagnosing the Climate for CorporateEntrepreneurship. During this step CECI is used. Describe 5 antecedents which the CECIis designed around.(Ref: 381 SG) (Appeared in Oct/Nov 2012 Q4.3)

Management Support ­ Willingness of top­level managers to facilitate and promote entrepreneurialbehaviour.

Work discretion/autonomy ­ Top­level manager’s commitment to tolerate failure, providedecision­making latitude and freedom from excessive oversight, and delegate authority andresponsibility to managers.

Reinforcement ­ Developing and using systems that reinforce entrepreneurial behavior, highlightsignificant achievements, and encourage pursuit of challenging work.

Time Availability ­ Evaluating workloads to ensure that individuals and groups have the timeneeded to pursue innovations and that their jobs are structured in ways that support efforts toachieve goals.

Organizational boundaries ­ Precise explanations of outcomes expected from organizationalwork and development of mechanisms for evaluating, selecting, and using innovations.

• Discuss Step 3 of CECIA CE strategy is implemented successfully, only when all actors are committed to it. Hence, individualsmust be aware of the intent and mission surrounding a CE strategy. Key decision makers must find ways toexplain ~their intent and mission to those from whom entrepreneurial efforts are expected. In addition, thereadiness of each actor to display entrepreneurial behaviour should be realistically assessed. Actions toenhance entrepreneurial skills of employees ∙ should then be set into motion. These commitments andprocesses help to shape a common vision around the importance of a CE strategy and entrepreneurialbehaviour the cornerstones to an effective strategic adaptation process. .As a way for organizations to develop a sound program for understanding entrepreneurial activity, a CEemployee development program should be established. Following are some suggested elements for such a

program The Entrepreneurial Experience—Review managerial and organizational behaviour concepts,

review definitions of corporate entrepreneurship and related concepts, examine the entrepreneurialprocess as it applies to established companies, and review several entrepreneurial cases.

Entrepreneurial Breakthroughs­ Present an overview of entrepreneurial breakthroughs in thecompany and in other companies. Best practices in terms of highly entrepreneurial initiatives can bereviewed. This challenges participants to think innovatively and emphasizes the need for “breakingout of the box” in today’s organizations. Importantly, employees must be given a reference point interms of the types of entrepreneurial activities that are expected of them.

Innovative Thinking—The process of thinking creatively is foreign to most bureaucraticorganizations. Misconceptions about thinking creatively should be reviewed and a discussion of themost common creativity inhibitors presented. After completing a creativity inventory, participantsengage in several exercises designed to facilitate their own creative thinking.

Idea Acceleration Process­Participants should generate a set of specific ideas on which theywould like to work. Issues of strategic fit can be examined, together with a review of the types ofcriteria used by the organization when evaluating new concepts. Additionally, participants candetermine needed resources to accomplish their projects.

Barriers, Facilitators, and Triggers to Entrepreneurial Thinking—Climate factors from theCECI are reviewed. The most common barriers to innovative behaviour should be examined anddiscussed. The process includes examining a number of aspects of the corporation includingstructural barriers and facilitators. Specific types of internal and external triggers for different formsof entrepreneurship can be explored. Participants can complete exercises that will help them dealwith barriers in the workplace. In addition, video case histories are shown that depict actualcorporate entrepreneurs who have been successful in dealing with corporate barriers. Time in thismodule, or in a distinct module, might be devoted to strategies for soliciting sponsors and leveraginginternal corporate resources.

Sustaining Innovation Teams­The concept of forming Innovation Teams to focus on specificinnovations is examined. Managers work together to form teams based on the ideas that have beencirculating among the entire group. Team dynamics is reviewed for each group to understand.

The Corporate Venture Plan­After participants examine the facilitators and barriers to behavinginnovatively in their organization, groups are asked to begin the process of completing a plan. Theplan includes setting goals, establishing a work team, assessing current conditions, developing astep­by­step timetable for project Completion, and project evaluation.

Finally, it is important to note that training must reinforce entrepreneurship as more than a one­time oroccasional activity. The more widespread the understanding of corporate entrepreneurship, the more likely itis that real culture changes will occur in the organization.

• Describe the steps in the innovation process(Ref: 389 SG) (Appeared in Oct/Nov 2010 Q3.2.2)

Idea Generation Concepting Testing Technical feasibility assessment Product testing Financial assessment Test marketing Launch

Study Unit 13 – 10 Points (Chapter 11 in TB)(Ref: 300 TB) (Appeared in May/June 2010 Q6.3; Oct/Nov 2011 Q6.3; May/June 2011 Q 3.2)• Name the Unintended ConsequencesControl is vital in organisations and control mechanisms may be well intended; however, they may have unintended consequences such as the following:

Trust problem. Employees may conclude that they are not trusted, which might undermine their willingness to tap their creative energies and come up with innovative ideas.

Slowness problem. Controls can evolve to the point where they slow the organisation down. If there are detailed documentation requirements and elaborate steps that employees must follow, then activities take longer to complete and people work more slowly as well.

Means­end problem. Managers may get so caught up in trying to create control mechanisms that they lose sight of what the controls were meant to accomplish.

Efficiency­effectiveness problem. Control measures may be able to achieve efficiency, but they ignore effectiveness.

• Discuss the 6 principles of Open­book Management1. Every employee has access to the company’s financials and all the other numbers that are critical to tracking the company’s performance.2. There is an overt and on­going attempt to get the information in front of employees.3. The company teaches the basics of the business (what the numbers mean) to everyone.4. Employees learn that, whatever else they do, part of their job is to move the numbers in the right direction.5. People are empowered to make decisions in their jobs based on what they know.6. Employees have a stake in the company’s success, and share in the risk of failure.

• Explain what the concept of organisational slack means.(Ref: 311 SG) (Appeared in Oct/Nov 2012 Q4.1)

The concept of slack implies a degree of looseness in resource availabilty. Employees can tap intoresources without going through a formal approval process. They can “Borrow” expertise, research,money, materials, equipment and other resources. Without slack, doing anything new becomesalmost impossible.

Study Unit 14 – 6 Points (Chapter 15 in TB)• What 4 ways can managers remain adaptive & innovative through & beyond growth?(Ref: 432 TB / 122 SG) (Appeared in May/June 2012 Q2.3; Oct/Nov 2010 Q3.1, Oct/Nov 2012 Q1.4; Oct/Nov2009 Q3.1) (Ass Q2/A2)

Share the entrepreneurial vision. ­ The entrepreneurial vision must be permeated throughout theorganization in order for employees to understand the company’s direction and share in theresponsibility for it’s growth.

Increase the perception of opportunity ­ This can be accomplished with careful job design. Thework should have defined objectives for which people will be responsible.

Institutionalise change as the organisational goal ­ This entails a preference for innovation andchange rather than preservation of the status quo.

Instil the desire the be innovative ­ The desire of personnel to pursue opportunity must becarefully nurtured.

• How do companies create a sense of urgency?(Ref: 434 TB / 122­123 SG) (Appeared in May/June 2012 Q2.4)

Management can create a sense of urgency by rethinking the fundamental assumptions thatunderlie business. Such as: The gap between our competition is smaller than we think, thecompany could be out of business in 24 months, customer loyalties could be fleeting.

• Discuss the importance of Sponsors & Champions(Ref: 420­421 TB, 120 SG) (Appeared in May/June 2012 Q4.3; Oct/Nov 2010 Q4.3)

Sponsors Often new ideas trigger the “Impatience clock”. Sponsors are managers at higher levels who

protect entrepreneurial individuals by building environments of safety. They helpentrepreneurs gain access to resources and information and believe in the entrepreneursvision and capabilities. Sponsors protect entrepreneurs from being fired.

Champions (Ref: 47­48 TB) Champions are employees who have recognized opportunity, have developed innovative

concepts, and then attempt to sell them to senior management. Champions pushinnovation forward by preserving and keeping an idea alive until management accepts it.

• Discuss the “Dark Side” of Entrepreneurship(Ref: 120­121 SG) (Appeared in May/June 2012 Q3.4)

The “Dark Side” of entrepreneurship includes: The confrontation with risk. Could include: Financial, career, family & social, psychic

risk Entrepreneurial Stress. Stress comes as a result of a struggle for resources, role

overload, time constraints and working alone. Entrepreneurial ego. Entrepreneurs can become overconfident resulting in: an overbearing

need for control, sense of distrust, overriding desire to succeed, unrealistic optimism.• Discuss the Entrepreneurial Ego (Done Above)• Discuss the Inflexible Rules

SHARE THE ENTREPRENEURIAL VISION ­ The entrepreneurial vision must be permeatedthroughout the organization in order for employees to understand the company’s direction and sharein the responsibility for its growth. The senior­level managers can communicate the vision directly tothe employees through meetings, conversations, or seminars. It also can be shared throughsymbolic events or activities such as social gatherings, recognition events, and displays. Whateverthe format, having a shared vision allows the organization’s personnel to catch the dream and

become an integral part of creating the future. INCREASE THE PERCEPTION OF OPPORTUNITY – This can be accomplished with careful job

design. The work should have defined objectives for which people will be responsible. Each level ofthe hierarchy should be kept informed of its role in producing the final output (i.e., a new process,service, product, business model, market). Top management must regularly review the company’sopportunity horizon, attempt to stretch that horizon, and reinforce a focus throughout theorganization on opportunity recognition. Another way to increase the perception of opportunity isthrough a careful coordination and integration of the functional areas. This allows employees indifferent functional areas to work together and recognize i: new possibilities through one another’seyes.

INSTITUTIONALIZE CHANGE AS THE ORGANIZATION’S GOAL ­ This entails a preference forinnovation and change rather than preservation of the status quo. If opportunity is to be perceived,the environment of the enterprise must not only encourage it but also establish it as a goal. Withinthis context, a desire for opportunity can exist if resources are made available and departmentalbarriers are reduced.

INSTILL THE DESIRE TO BE INNOVATIVE ­ The desire of personnel to pursue opportunity mustbe carefully nurtured. Words alone will not create the innovative climate. Specific steps such as thefollowing should be taken.

∙ A Reward System. Explicit forms of recognition should be given to individuals who pursueinnovative opportunities. For example, bonuses, awards, salary advances, and promotions shouldbe tied directly to the innovative attempts of personnel.

∙ An Environment that Allows for Failure. The fear of failure must be minimized by thegeneral recognition that often many attempts are needed before a success is achieved. This doesnot imply that failure is sought or desired. However, learning from failure, as opposed to expectingpunishment for it, is promoted. When this type of environment exists, people become willing toaccept the challenge of change and innovation.

∙ Flexible Operations. Flexibility creates the possibility of change taking place and having apositive effect. If a venture remains too rigidly tied to plans or strategies, it will not be responsive tonew technologies, customer changes, or environmental shifts. Innovation will not take placebecause it will not “fit in.”

∙ Development of I­ Teams. In order for the environment to foster innovation, I­Teams(Innovation Teams) with performance goals need to be established. These must be not just workgroups but visionary, committed teams that have the authority to create new directions, set newstandards, and challenge the status quo

• Discuss how to embrace the paradox the paradox of size and scope

smaller companies are quick and flexible, innovate on the fly the technology revolution has allowed them to operate on a larger scale as a result large companies are transforming themselves into confederations of small

independent firms the paradox of economies of scale

the paradox of risk and return doing something highly innovative may not produce returns

the paradox of the individual and the team the paradox of flexibility and control

large companies have downsized and restructured to become faster and flexible its hard to maintain flexibility and a sufficient level of control

the paradox of constructive and destructive behaviour CE requires both stability and turbulence Entrepreneurship is both constructive and destructive making existing operations obsolete New innovative products replace old established ones

the paradox of success and failure entrepreneurs are replacing conventional managers who have a need for success but some

innovations fail within failure are the seeds for success

• Discuss the Entrepreneurial Mindset

Even entrepreneurial managers may lose their entrepreneurial edge. The demands of day­to­dayadministration and organisational policies, procedures and systems tend to force the entrepreneur tobecome more administratively oriented.

The entrepreneurial mind set is about innovation and change, and recognising and developing thecapabilities to achieve such change. In order to maintain the entrepreneurial mind set, the manager mustassume four on going responsibilities. These include

framing the challenge clear definition of the specific challenges everyone in the innovative project should address

absorbing the uncertainty make uncertainty less daunting

defining gravity what is accepted and what is not accepted

clearing obstacles internal competition for resources, must secure them

• Name the 6 Dominant DomainsThe organisations of tomorrow will be the ones that will be capable of merging strategic actions withentrepreneurial actions on an on­going basis in six dominant domains:

innovation ­ (innovation efforts must be managed strategically) networks ­ (networks of cooperation between organisations) globalisation/internationalisation ­ (exploitation of global networks and opportunities) organisational learning ­ (strategic commitment to learning) the top management team and governance ­ (must have a shared entrepreneurial vision) growth opportunities ­ (changes in environments)

• Discuss the 4 major portfoliosEntrepreneurial organisations in the twenty­first century will be conceptualised as a collection of four majorportfolios:

portfolio of competencies skills and capabilities within the organisation that the strategic direction will be built around

the ability to innovate, adapt and manage change portfolio of resources

financial, physical, human relational and intellectual resources that are innovating andenabling

portfolio of innovations balance between new pps pursue multiple innovations and learn systematically cycles of rapid evolution and periodic revolution

portfolio of ventures devolution of the company into smaller ones that can be seamlessly coordinated

From a portfolio perspective, the organisation becomes a dynamic incubator for concepts, products andventures.

• Discuss the Triggering EventsEvents that trigger corporate entrepreneurship can be of either external or internal origin:

External triggersEntrepreneurial management and entrepreneurial ideas are forthcoming when organisations face diminishingopportunities, rapid changes in the external environments and increasingly short decision windows. Thetrigger for corporate entrepreneurship in an organisation could be aggressive competitor moves, or changesin the industry or market structure.

Internal triggersEmployees sometimes say that they pursue an idea when it intrigues them and they believe in it, or whenthey take exception to the fact that one of their ideas has been rejected.Triggering events can be grouped into five broad categories, namely:

1. internal/external triggers2. opportunity­driven/threat­driven triggers3. technology­pushed/market­pulled triggers4. top­down/bottom­up triggers5. Systematic or deliberate search/chance or opportunism

Previously Mentioned Questions MOST PROBABLY not in this exams Scope:

Study Unit 12• Discuss Entrepreneurial Intensity (10 Points)(Ref: 74­77; 378 TB) (Appeared in May/June 2012 1.1; Oct/Nov 2010 Q1.1)

EI is measured by determining the degree and frequency of entrepreneurship. The degree ofentrepreneurship is measured by measuring the company’s innovativeness, risk­taking, andproactiveness. The frequency of entrepreneurship is measured by focusing on the number of events(new product, service or process introduction.)

• Describe the 4/7 ways entrepreneurship is fostered.(Ref: 46 TB, 17 SG) (Appeared in Oct/Nov 2012 Q3.1)

Traditional R&D (Research & Development) ­ “Leave it to the technical guys” Ad Hoc Venture Teams ­ “Here’s the concept, the budget, and a deadline ­ go to it”. Normally has

flexibility and freedom. Senior management puts the staff in place. New Venture Divisions or Groups ­ “We want a factory for breakthrough concepts.” ­ A

permanent unit is established where the objective is breakthrough innovation and the creation ofentirely new markets.

Champions and the Mainstream ­ “It’s up to everyone, including you” ­ Entrepreneurship canoriginate from any person, level, or department in the organisation.

Acquisitions ­ “We can buy growth and obtain the products, markets, and technologies of others” ­Happens through purchasing other companies.

Outsourcing ­ “Let’s have someone else develop it for us, and then we’ll make the money” ­Sometimes cheaper than doing the same thing in­house.

Hybrid Forms ­ “Mix and match the other approaches to fit our context.”

Previously Mentioned Questions DEFINITELY not in this exams Scope:

5 Elements of Culture: (Study Unit 9, 269 TB)Mentioned in: May/June 2012 ­ Q1.2; May/June 2011 ­ Q2.2; Oct/Nov 2010 Q1.2)

8 Elements of Entrepreneurial Culture: (Study Unit 9, 79 SG, 275­276 TB)Mentioned in: Oct/Nov 2011 ­ Q3, May/June 2010 ­ Q3.

4 Generic Culture Types: (Study Unit 9, 272 TB)Mentioned in: Oct/Nov 2012 ­ Q3.2