Erasmus Intensive Programme: “Fostering the entrepreneurial spirit in Europe through development of entrepreneurial sales personality” Riga, 10 – 23 November 2013 Latvi

1. Prevention of Entrepreneurial Failure
in the start-up phase
Erasmus Intensive Programme:
“Fostering the entrepreneurial spirit in Europe through development of
entrepreneurial sales personality”
Riga, 10 – 23 November 2013
Latvia
Ing. Matthijs H.M. Hammer M.Sc.
Senior lecturer Entrepreneurship
School of Busuness, Builsing & Technology
PhD Researcher
Faculty of Product Innovation Management

2. Menu
•
•
•
•
•
•
•
•
Introduction
Recall of last week
Theoretical background
Focus on: ‘Entrepreneurial Sales Personality’
IDP, Business Plan YOU!
Talent Development
Your App’s-store
Application in this week: Business Plan YOU!

3. Introduction
• Present yourself, maximum 30 seconds
• Present your group, 1 minute
• Present your groups result until now, 1minutes & 30 sec.
• Present your groups ambition, minimum 2 minutes

4. Recall of last week
• Please tell about:
• IDP
• Effectuation
• Business Plan You!
• Accounting
• Entrepreneurial personality
• Leadership

5. Recall of last week
•
•
•
•
Entrepreneurial process
Opportunity recognition
Opportunity preparation
Opportunity exploitation
• Difficult?

6. So, what do you want need more ….

7. A high failure rate
60 % 5 year failure rate
Statistique Canada (PALE)
Business closure rates by time trading
(Cressy, 2006)
49,5% 5 year failure rate
Insee (Sine)
39 % 2 year failure rate
BTS (Tunisian Solidarity Bank )
50 % 5 year failure rate
CBS (Statistics Netherlands)
50 % 4 year failure rate
U.S. Census Bureau (BITS)
Diversity of proxy measuring failure
(bankruptcy, closure, exit, insolvency, discontinuity, etc.)

8. Theoretical background
Causes of Entrepreneurial Failure:
• mismanagement, unrealistic expectations, finance
and lack of innovation (Cardon, Stevens, & Potter, 2011).
• Lack of strategic resources (Michael & Combs, 2008),
• planning strategies (van Gelder et al, 2007),
• pride (Hayward et al, 2006),
• not able to cope with uncertainty (Mc Grath, 1999)
• over-optimism and overconfidence (Muir, 2007).

9. Theoretical background
Prevalence of discriminant approach (positivism)
(Cooper et al.,1994 ; Duchesneau & Gartner, 1990 ; Dahlqvist et al., 2000 ; Littunen et al.,
1998 ; Lussier, 1995 ; Lussier & Pfeifer, 2000 ; Reid, 1999 ; Wetter & Wennberg, 2009)
Success/Failure = f(X1,X2,X3,..Xn)
X1 ?
X2 ?
X3 ?
Y
Success/Failure
???
Survivors/Exitors
Xn ?
Entrepreneurship policy of “picking winners”
The “ideal predictive and discriminant factor” opposing successful and failing
entrepreneurs does not exist.
it impossible to predict exactly how the entrepreneurs will fail.

10. Theoretical background
Questions to address:
• So what?
• How does it imply me?
• How does this affect with the Entrepreneurial Sales
Personality?
• An answer: looking from an interpretative approach.
(Askim-Lovseth & Feinberg, 2012; Cardon et al., 2011; Cope, 2011; Crutzen,
2009; Mantere et al., 2013; Seshadri, 2007; Singh et al., 2007; Zacharakis et al.,
1999)

11. Theoretical background
Dimensions
Determinist
approach
Voluntarist
approach
Theoretical
foundation
PEOT
RBV
Failure
causes
Concept of
failure
Source: Khalil, 2010
Entrepreneurial
context
Discontinuity
Entrepreneurial
Resources
Deficiency
Emotive
approach
GAGT
Entrepreneurial
Motivation
Deception

12. ECONOMIC SUCESS
OF THE NEW VENTURE
High new venture economic
3
1
performance
Exit due to a
psychological
distress
Positive
Exit strategy
Entrepreneurs' self
Deception
Psy-ecomomic Economic
4
’
4
2
’
Distress Difficulties
Exit due to a
Exit to avoid
psy-ecomomic
distress
4
2
Low new venture economic
performance
Voluntary exit
Involuntary exit
Entrepreneur's self
satisfaction
Psychological Entrepreneurial
succes
Continuity with Continuity with
Distress
ECONOMIC FAILURE OF
THE NEW VENTURE
an increasing
economic losses
PSYCHLOGICAL SUCESS
OF THE ENTREPRENEUR
PSYCHLOGICAL FAILURE OF THE
ENTREPRENEUR
3
’ Continuity with Continuity with

13. IDP, Business Plan YOU!
?
5 minutes break for chemical dependencies and biological necessities.

14. Resume
• To reduce failure-rates in the start-up phase, compose
the best entrepreneur(ial team) available.
How?
• Talent Development

15. Give examples!
WHAT IS A TALENT?

16. A talent is:
• Old Greek: a weight or sum of money of that weight.
Later the disposition or ´gift of God´. (van Dale, 2009)
• Best & Brightest. (Knegtmans, 2009)
• Exceptional disposition (Wikipedia, 2010).
• Relative.
• Talent
(Dutch, English, French, African, Catalonian, Russian, German,
Romanian, Icelandic, Czech, Danish, Polish, Estonian, Norwegian)
• Fi: lahjakkuus, Lv: Talants, Lt: Talentas

17. Facts
• Be willing to is more important than be able to.
(Knegtmans, 2009)

18. Example
See possibilities
Know where to find it.
Tackle opportunities
Successful application

19. Facts
•
Be willing to is more important than be able to.
(Knegtmans, 2009)
• Training has more effect than Genetic factors.
• Top talent = (talent * mentality) / ego (T. van het Hek, 2000)
• Talent is gained by internal motivation and long,
effective and focused training.

20. How to develop?

21. What to develop?
• Your talents!
Exercise 1a
• But: what are Your talents?
• How to distinguish them?

22. Exercise 1a: Write down YOUR talents.

23. The Competent Egg
Talent
Structure
Knowledge
Behaviour
Context
Application
Source: N. Vloon, 2002

24. What suites You?
• What do You like?
• What distinguishes You?
• What is appreciated?
• Problem:
You don´t know for yourself.

25. Identify Your talents
• Use tools as:
– 360° Feedback
– Personal SWOT
– Explicit Your context
Exercise 1b: Describe Your context.

26. Exercise 2
5 minutes each
You: tell Your Neighbour about your job (or sports).
Neighbour: write down where he is positive, explores
fun, smiles, is exciting, etc. Ask for examples, achieved
goals, feedback from colleagues.
At the end, ask for his perceived personal strong points
and weak points (about 3 aspects each).
Exercise 1 b and 2, are determining your
relevant talents.

27. How to develop?

28. Difficulties
• SME-issues:
– No HRM-department
• job coach
• assessment centres
– No broad scope of specialists
– Limited places to work (fte)
• job rotation
• spare time for development
• exemplary roles

29. Talent development in SME´s
Pers. SW
360° feedback
context
Today
Talent
development
Pers. goals
Business goals
Talent
Near
Future
Talent
needed
far
Future

30. Different ways of development
Falcon
Goose
Source: N. Vloon, 2002

31. Development in SME´s
• Training in the same context, maintain the talent.
• Training in a different (future orientated) context,
increase the talent, makes it more valuable.
Exercise 3

32. Exercise 3:
1.
2.
3.
4.
Write down your talents today
Write down your personal goals and objectives
Determine one of your talent to develop
Describe a way to practice that talent (knowledge, skill,
behavior) in another context then your current
professional activity.
5. Do it, with motivation and drive!

33. Summery
1. Determine what your motivation is; what make you
have fun.
2. Determine your relevant talents.
3. Determine what is your goal.
4. Create training activities in another professional
context.
5. Do it! (with motivation and drive)

34. Your App’s store
1. What is an App’s?
Applicability Approvals (2 * App = App’s)
2. What are they?
Proof of successful application of your talents /
competencies.
3. How do they look?

36. Your App’s store
Status Name
Description
C
Concept
No evidence of competence
B
Believe
Poor evidence of competence
A
Awareness
Some evidence of competence
AA
Applicability Approvals
Proofed evidence of competence, in
simple, single context
AAA
Advanced Applicability
Approvals
Proofed evidence of competence, in
complex, multiple context
Source: Vloon & Hammer, 2013

37. Lessons learned
1. Determine what your motivation is; what make you
have fun.
2. Determine your relevant talents.
3. Determine what is your goal.
4. Create training activities in another professional
context.
5. Do it! (with motivation and drive)
6. Make your improvements App’s store ready
7. Sell yourself to the winning team of stakeholders

38. Thank You
for your
Attention