Managing Growth and Expansion
QUESTION: Discuss the expansion and growth strategies: joint venture, acquisition, merger, hostile takeover, leverage buy outs. Give examples of each in the discussion.
ANSWERS AND DISCUSSION: All successful small business startups eventually face the issue of handling business expansion or growth. Business expansion is a stage of a company's life that is fraught with both opportunities often fortunes and for perils. it a owners On the one hand, business in In growth carries with corresponding and employees increase alike.
financial
addition, expansion is usually seen as a validation of the entrepreneur's initial business startup idea, and of his or her subsequent efforts to bring that vision to fruition. "Growth causes a variety of changes, all of which present different managerial, legal, and financial challenges. Growth means that new employees will be hired who will be looking to the top management of the company for leadership. Growth means that the company's and management may will become less of and less centralized, this raise the levels internal
politics, protectionism, and dissension over what goals and projects the company should pursue. Growth means that market share will expand, calling for new strategies for dealing with larger competitors. Growth also means that additional capital will be required, creating and new responsibilities lenders. these to Thus, shareholders, structure, investors, and institutional Given
growth brings with it a variety of changes in the company's needs, objectives." realities, Sherman stated that "the need of the organization to grow must be tempered by the need to understand that meaningful, longterm, profitable growth is a by-product of effective management and planning." (Andrew J. Sherman; The Complete
Guide to Running and Growing Your Business)
METHODS OF EXPANDING THE BUSINESS
GROUP II_FINAL EXAM_Entrep. Page 1
Through negotiation, an entrepreneur can expand the original venture. Actual
ANSWERS AND DISCUSSION: All successful small business startups eventually face the issue of handling business expansion or growth. Business expansion is a stage of a company's life that is fraught with both opportunities often fortunes and for perils. it a owners On the one hand, business in In growth carries with corresponding and employees increase alike.
financial
addition, expansion is usually seen as a validation of the entrepreneur's initial business startup idea, and of his or her subsequent efforts to bring that vision to fruition. "Growth causes a variety of changes, all of which present different managerial, legal, and financial challenges. Growth means that new employees will be hired who will be looking to the top management of the company for leadership. Growth means that the company's and management may will become less of and less centralized, this raise the levels internal
politics, protectionism, and dissension over what goals and projects the company should pursue. Growth means that market share will expand, calling for new strategies for dealing with larger competitors. Growth also means that additional capital will be required, creating and new responsibilities lenders. these to Thus, shareholders, structure, investors, and institutional Given
growth brings with it a variety of changes in the company's needs, objectives." realities, Sherman stated that "the need of the organization to grow must be tempered by the need to understand that meaningful, longterm, profitable growth is a by-product of effective management and planning." (Andrew J. Sherman; The Complete
Guide to Running and Growing Your Business)
METHODS OF EXPANDING THE BUSINESS
GROUP II_FINAL EXAM_Entrep. Page 1
Through negotiation, an entrepreneur can expand the original venture. Actual