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					The Zenie Group

Entrepreneurship
Apply your engineering talent to create your dream company. But remember - starting a company is easy, building a successful business is hard!
frank@zeniegroup.com www.zeniegroup.com

11 February 2009

StreetSmart Entrepreneuring www.zeniegroup.com

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StreetSmart Entrepreneuring Frankly Speaking
Give me your email address – I‟ll send ,pdf copy Your Questions will influence the Value of my Answers.

StreetSmart Entrepreneuring www.zeniegroup.com

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Disclaimer I have an Agenda! But, it‟s not hidden.

Have you heard about the hammer that thinks everything looks like a nail?

I‟m an entrepreneur and I actually do believe that “Entrepreneuring” leads to the best solutions to most business problems!
StreetSmart Entrepreneuring www.zeniegroup.com
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My Advice to Engineers

Engineering, Technology and Science are Entrepreneurial Tools

Customers, not technology, are its foundation.
StreetSmart Entrepreneuring www.zeniegroup.com

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What a change !

 In

the late 1950s, 1960s and 1970s, we tried to instill “successful” big company practices into emerging companies - probably destroying many. the 1980s and 1990s; Peter Drucker, Tom Peters and others challenged this. I believe we should be instilling entrepreneurial leadership into our largest companies - maybe we can save them.
StreetSmart Entrepreneuring www.zeniegroup.com
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 In

 Today,

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OK – What is an entrepreneur?

StreetSmart Entrepreneuring www.zeniegroup.com

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What is an Entrepreneur?

Entrepreneurs BUILD BUSINESSES through INNOVATIVE SOLUTIONS to UNMET CUSTOMER NEEDS.
(Note: Entrepreneurs do exist in the public and non-profit sectors.)

“Above all, innovation is not invention. It is a term of economics not technology.” * Entrepreneurs create discontinuities – They obsolete accepted practices and change * Peter Drucker behavior.
StreetSmart Entrepreneuring www.zeniegroup.com
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Fast vs. Right
 Mature

Businesses “Right First Time” Businesses “Fast First Time”

 Entrepreneurial

Is this true? Why?
StreetSmart Entrepreneuring www.zeniegroup.com
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The Changing World of Innovation
Courtesy of Daniel H. Pink

ATG
Affluence Technology Globalization

“A Whole New Mind”
Why Right Brainers Will Rule the Future 2005 - page 49

Conceptual Age (creators and empathizers)

Information Age (knowledge workers) Industrial Age (factory workers) Agriculture Age (farmers)
Maybe Walt Disney and Steve Jobs are our prototypes

18th Century - 19th Century - 20th Century - 21st Century
StreetSmart Entrepreneuring www.zeniegroup.com
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Frank‟s Entrepreneurial Principles
The Fundamentals are Simple

what you hope to achieve through this venture.  Culture a set of underlying, shared values.  Innovative Product/Market Strategy what you will sell and how you will sell it.  Sound Business Model how you will earn a profit.  Passionate Execution
StreetSmart Entrepreneuring www.zeniegroup.com
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 Vision

The Zenie Group

Markets Don‟t Exist – Only Customers

The Entrepreneur‟s Job is to:



  

Identify potential customers Understand their unmet needs, business economics, constraints & priorities Create innovative, high value-added solutions to these needs Define new MARKET segments which enable you to communicate your benefits effectively! Leverage your market segmentation for differentiation & strategic advantage – dominate a niche and build from there. This is not an analytical or statistical exercise, rather its a face to face, creative and interactive customer experience.
StreetSmart Entrepreneuring www.zeniegroup.com
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What would you prefer? You have a business with $10 million annual sales serving a $1 billion market. Choose 1:

 1%

market share spread across the entire market, or  100% of a $10 million niche within the broad market. Why?
StreetSmart Entrepreneuring www.zeniegroup.com
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Entrepreneurial vs. Traditional Market Perspectives

Traditional Market Definition
For example - 1960s Traditional US car manufacturers. Big, powerful & inefficient.

Today Prius & Hybrids Toyota mid 1960s
Small, fuel efficient & Low Cost followed by variety of new models

Lexus - 1989
One Luxury Model, LS400 followed by variety of new models
StreetSmart Entrepreneuring www.zeniegroup.com
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Intellectual Property

Market Power (MP) TRUMPS Intellectual Power (IP) The more successful you become, the more competition you will attract. How many great products were sustained monopolies? Likely response to your intellectual property:
 Respect your patent and invent an equivalent or superior alternative.  Respect your patent and purchase a license from you.  Respect your patent and abandon the market.  Ignore your patent and reverse engineer and copy your product.

StreetSmart Entrepreneuring www.zeniegroup.com

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MP Trumps IP
True Story - One of my companies files a patent suit against a much large competitor for patent infringement.

Monopoly

 It took 9 years from filing suit to damage determination.  Legal expenses reached $2 million.  Management distraction - huge opportunity cost.  Jury determined patent was valid and the competing product infringed.  Judge confirmed infringement, but no willful act by infringer.  Final damages $50,000 + interest for 9 years.

StreetSmart Entrepreneuring www.zeniegroup.com

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A Real Example
 Founded in January 1999 All founders from Zymark Corporation Ken Rapp, NEU „84 President & CEO FHZ co-founder & Chairman

in Hopkinton, MA  Website – www.velquest.com  Some of today‟s customers:
Pfizer, Glaxo SmithKline, Bristol-Myers Squibb AstraZeneca, Eli Lilly, Johnson & Johnson
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 Headquartered

The Zenie Group

Our Founding Process

Who is our customer? - From our prior experience, we decided to serve laboratories in the pharmaceutical, biotech and related industries.  We wanted to create Primary Demand rather than compete with existing products.  “Customer Research” - Using our contacts, we visited 50 companies to discover their unmet needs.  The CEO attended every meeting accompanied by at least one other founder.

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Customer Research – How We Do It

 



Find thoughtful, objective people. Go to them – face-to-face. Bring a colleague. Look and Listen Very Carefully
       Briefly explain your objective Best Question: Confirm host‟s time constraints What keeps you Promise to share your findings up at night? Ask open-ended questions Follow-up with clarifying questions Observe body language Never ask what they want. Inquire about problems and current solutions. Customers will ask for incremental improvements to current solutions.  Your job is to create a far better solution – discontinuities.



Send thank you note and ask if you can come back to share your findings and clarify and additional questions.
StreetSmart Entrepreneuring www.zeniegroup.com
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What We Found

 Customers reported resource constraints because increasing work loads and tighter time constraints.  Digging deeper; in manual paper-based systems the FDA requires layers of redundant checking to claim data integrity.  As regulations increased, more resources were diverted from doing to checking and documenting.  We discovered that 70% of their total laboratory resources were committed to compliance.
Analyst/Chemists Data Creation, Investigations and Documentation QA/Regulatory Inspections and Audits

Supervisors & Data Reviewers Review, Checking and Approval

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The FDA

The FDA regulates US food and drug businesses.  While it‟s a US agency, it‟s a strong model for Europe and Japan. Many regulations are being globally harmonized because pharma is rapidly moving to global organizations.  Most FDA regulations for development and manufacturing are called Good Manufacturing Practices (GMP) and Good Laboratory Practices (GLP) – they are quite similar. We use GMP to describe the family of regulations.  Redundant Checking vs. Computer Validation

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VelQuest‟s Niche

created a new segment “GMP Electronic Notebooks”  We are not a LIMS, ERP, Document Management System or many others - we make them more valuable.  If Microsoft is desktop, VelQuest is benchtop.  We replace “paper notebooks” with fully validated electronic data acquisition, documentation and quality verification.
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 We

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Thanks Questions and Discussion

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