Preface of Textbook
About the Textbook
About the Authors
Book Website at McGraw-Hill
DVD Contents
Stanford 1e Book Website
McGraw-Hill 1e Book Website
Book Contents
Table of Contents
Venture Opportunity, Concept and Strategy
Venture Formation and Planning
Functional Planning of the Venture
Financing and Building the Venture
  Business Plans (App. A)
  Case Studies (App. B)
Online Sources (App. C)
Sample Syllabus
Course Overview
Calendar of Sessions
Entrepreneurial Perspective
Idea or Opportunity
Gathering Resources
Managing Ventures
Entrepreneurship and You
Additional Resources
Schools Using This Textbook
Authors Blog

Most businesses build a chain of activities that add value at each section of the chain. Each element of the value chain has a capability that provides value added to the product. A new venture manages its value chain to provide the ultimate product to the customer. The firm also moves, stores, and tracks parts and materials to its value-adding partners and strives to ensure timely, efficient production of the service or product. Information flow along the value chain enables the coordination of the distributed tasks. An effective enterprise manages for operational excellence by trying to develop and communicate measurements of efficiency and timeliness. Another way to describe a set of interrelated tasks is as a network of activities. A value web (or network) can use an internet-based system to communicate with all the network participants. With a common schedule and associated tasks, the venture can manage the value web to achieve on-time production.


MicroAge, Inc.: Orchestrating the Information Technology Value Chain
MicroAge, Inc. started as a storefront in Tempe, AZ in 1976 selling personal computer kits to hobbyists. During their first year of operation, founders Jeff McKeever and Alan Hald sold $1.5 million worth of computer kits, priced at under $1,000 each. Twenty years later, revenues exceeded $3.5 billion dollars, while the business evolved from a computer store to a master reseller and full-line integrator of information technology products. MicroAge continually reinvented itself and its business with an entrepreneurial spirit most companies of its size cannot enjoy. MicroAge thrives on the theory that many of its fiercest competitors can also be its best clients.
Donner Co.
The management of a small manufacturer of circuit boards faces a number of production and operations management problems. The first day on this case is used to analyze the production capacity of various stages in the process and to examine bottlenecks and key production flow decisions. The emphasis is on physical flows. The second day the emphasis is on information flows. We look in detail at the problems faced by the company, discuss the tools and techniques of process analysis that can be used to determine the relative importance of those problems, identify solutions, and discuss implementation issues.
(DVD Section 14.2) Ellon Musk: Reducing Company Costs - Paypal and SpaceX
Elon Musk talks about how SpaceX is reducing the cost of launch vehicles. The focus is on every element of the vehicle and this has involved hundreds of small innovations as well as reducing overheads. In the case of PayPal there were back office relationships that had to be established but everything was done in parallel thus saving time.
David Neeleman: JetBlue: Employee Incentives and Rewards
Many people say that United spends 40% of costs on labor, and JetBlue only spends 25%. Does JetBlue pay its employees 1/2 as much as United? Neeleman points out that JetBlue pays employees more than standard wages at United. They use technology to be more efficient, to spend less money in other areas. Much of the pay that employees receive is incentives. For example, pilots and flight attendants who fly over 70 hours each month receive time and 1/2. About 20% of compensation last year was based on the success of the company. In our 2nd full year of operation, we paid over 17 million back to our employees, which is 15 1/2%.
Lynn Reedy: eBay - Areas for Improvement
An important area of improvement is cross border trade which includes shipping, customs and language (auto-translate). Creating businesses around eBay to continue to grow the trading community (e.g. Auction Drop). How do we convince people of the safety of the site and how do we make it easier to use.
What Is the Right Supply Chain for Your Products?
Never has so much technology and brainpower been applied to improving supply chain performance. But the performance of many supply chains has never been worse. Why haven't the new ideas and technologies led to improved performance? Because, Marshall Fisher says, companies lack a framework for deciding which ones are best for their particular situation. Fisher offers such a framework to help managers understand the nature of the demand for their products and devise the supply chain that can best satisfy that demand.


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