Paul Verdin

Successful new ventures: Lessons for entrepreneurs and investors

Abstract Why do some ventures succeed and not others? Traditional answers usually invoke poor management, flawed product, insufficient cash or weak marketing. This paper proposes a new set of answers. From an analysis of 37,000 new U.S. businesses and a number of U.K. case studies, it is clear that other factors also play a decisive role including: a products purchase frequency, service requirements, customer/distributor fragmentation and labour intensity. Careful analysis of such product market characteristics prior to start-up significantly increases the chances of survival and success. This article demonstrates that choosing the right battlefield is absolutely critical. It provides a framework to guide both the new venturer and investor in making this key decision—where to fight?

So you want to integrate Europe: How do you manage the process?

This article, by Alice de Koning, Paul Verdin and Peter Williamson contributes to the debate on corporate European integration. The focus of their research is on how the process of transition from fragmented, nationally-dependent organizations towards more integrated, European regional networks can be managed and a successful outcome achieved. The authors stress the importance of choice of process as determining both success and type of integration achieved. They create a framework which emphasizes the options facing managers relating existing organizational structure, change culture and market conditions to effective choice of integration processes. Ten key aspects of managing the integration process are suggested to be of critical importance for success. A forward-looking question for research is -- how an organization selects or evolves an appropriate path to integration for itself.

The Strategic Imperative of Creating and Capturing Value

These are uncertain times. That is the understatement of the last few years, if not of the last decade. While this could also apply to the political, social, demographic and even the scientific, technological and climate front, what has happened on the financial and economic scene in the past couple of years is unprecedented in terms of magnitude and global coverage, even if the underlying mechanics and principles were not without parallel or historical basis and bias.1

The Strategic Imperative of Psychological Safety and Organizational Error Management

Despite considerable discussion in the management literature about the need for flexible strategies and agile learning organizations, many—if not most—large organizations and their strategy processes remain top-down, slow to change, and fraught with obstacles to learning. A “strategy-as-learning” approach is presented that contrasts with the dominant conception of strategy-as-planning. Conceptualizing and practicing the work of organizational strategy as a learning process implies that strategy is about developing good questions and thoughtful hypotheses to be tested through execution. This produces a mode of operating called execution-as-learning.

On Organizational Structures and Blueprints

When your activities are spread widely around the globe, it is all the more important to organize them properly. Who manages which part? Who should report to whom and what are their exact responsibilities? How are units related to the company headquarters and the other units? What is the relationship of staff to line managers? Are responsibilities based on a geographic region, a product line, or a function? Does this responsibility count for the whole of the organization, the European part or just the home country? This is what organization charts are supposed to handle: they ‘draw the lines’ within and across the organization.

Internationalization: The Only Way to Go?

The power of one-liners can be enormous: they help with summarizing broader arguments, simplifying complex realities, lightening up and stimulating the debate and can generate a bigger impact on an audience than an elaborated and carefully argued contention. On the other hand, history has demonstrated — sometimes painfully — the risks and shortcomings of relying on one-liners in running a country, an organization or a company.

On Entry Modes into Foreign Markets

So you want to enter foreign markets. How do you do this? You set up a sales office, build a plant, look for a local partner to franchise your concept to, or you look for a local player to buy, or a combination of any of the above. Relander, CEO of Sonera, was clearly thinking in terms of entry modes when he said: Sonera’s internationalization involved seeking partners, corporate acquisitions, establishing joint-ventures, making agreements and creating global service business activities.

The Conelearn Framework

Notwithstanding the many questions and remarks raised in Chapter 1 on the popular internationalization motives and impulses, there are several good reasons to internationalize, and various ways you can take advantage of it. We do not aim to promote undue scepticism about internationalization, or to scare you with examples of unqualified failures or internationalization horror stories. The vast majority of the companies we ran into in our research did manage to profit from their internationalization one way or the other, although often not to the extent or in the way expected. The aim of this chapter is to understand in what way(s) one can expect to realize real benefits.

From Local Champions to Global Masters: Conclusion

It’s impossible to avoid the risks completely. But sensible managers, and prudent investors, can at least avoid the obvious mistakes. (Peter Martin) Having guided you through the ‘internationalization’ loop and some key reflections around the why, what and how of internationalization, now we want to recap the key highlights in the strategic reflection on internationalization.

Managing the Implementation Process

Internationalization is more than just deciding on the strategic and organizational blueprint you should go for. Yet, we see a continuing tendency to underestimate the importance of working through how to put the blueprints into action. More specifically, the critical issue usually is how to get from here, the current strategy and organization, to there, the desired strategy and organization. This may seem simple, too simple. But a manager with experience in the globalization of a major multinational from Asia said: ‘Those that planned it, saw it too easy.’