Traditional approaches to guiding entrepreneurs tend to follow a sequential process, centred on the business plan, and with focus on the start-up phase of the business. This type of approach often leads to a tick box ü approach from the entrepreneur, rather than taking a strategic view of the entrepreneurial advantage and opportunity, then engaging with the target community of stakeholders. This means getting out there into the market in shorter engagement cycles managed within a framework. This assures the entrepreneur and his/her team have contact with customers and stakeholders, can learn and adapt to continuously refine the proposition that optimises its value proposition and scaling capability. In addition many entrepreneurs may have limited previous business experience and/or support ecosystems, hence failure rates remain stubbornly high globally.
A recent study by Harvard Business school indicates that New Venture failure rates are between 30% and 90% depending on how you define the criteria for failure:
- 30% to 40% where investors liquidate and lose most or all of their investment.
- 70% to 80% where the business stakeholders fail to see expected ROI
- 90%-95% where the business declares a projection and fails to meet that projection
This paper proposes and new model that enhances our methodologies for supporting entrepreneurs and the entrepreneurial ecosystem. The model draws from latest thinking relating to “Agile” approaches which first came to prominence in the software development industry in 2001.
By adopting the new model proposed we enable the entrepreneur to create “Agile Advantage” in their new venture and continuously build that advantage through the organisations life cycle.
“The Business Advantage Model” is an Agile model which guides the entrepreneur in “doing the right things, the right way, at the right time”, with the objective of improving start-up and scaling success rates . Central to the model is the need to base milestones and deliverables on facts and information rather than descriptive deliverables, while having a focus on Advantage across the business . Advantage creates differentiation and value internally & externally.
Understanding the information and decisions an entrepreneur has to make as they proceed through the start-up and growth cycle and, providing a model that guides them through each phase where they consider only the relevant importance of the key functions at any point in time make them more effective. This means that the entrepreneur can be responsive, flexible and agile, and the model acknowledges the continuous learning, sensing and adaption that entrepreneurs and entrepreneurial organisations must deal with day to day and period to period.
The Model looks at the six key phases for an entrepreneurial organisation
The Model was derived from many years of study and review of entrepreneurs and organisations and has been validated in organisation.
The adoption of Agile models in Education, Incubation and Enterprise development agencies should improve success rates and deliver improved economic outcomes.