Welcome to Week 15!
Entrepreneurship: Chapter 10 and 11
Ashton Converse
Corporate Governance and Organizational
Structure and Controls
Objectives/Schedule
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Welcome
Final Exam will be on Thursday December 27th
End of the Semester Information
Quick Speech of Learning Outside of Class and
Cases
– Cases start on page 292
• Review
• Chapter 10
• Business Plan Discussions
– Feedback and Future Outlook
Final Exam
• Final Exam will be on December 27th
• Final Presentations and Report are due on
December 26th during class.
– This means the final exam will not be complex.
• Final Presentation are part of final exam score!!!
– Final exam will cover all information after the
midterm exam.
– Review PPT’s
– Look at the website
– Use the book and end chapter summaries
– Use notes and articles
End of the Semester Schedule
• Today, December 12th, we will finish chapter 9
and start working on chapter 10
– Cooperative Strategies and Corporate Governance
• Tomorrow, December 13th, we will finish
chapter 10 and start chapter 11
– Organizational Structure and Controls
• Next Wednesday, December 19th, we will
complete chapter 11 and chapter 12
– Strategic Leadership, Reminder about Cases
Application Cases
• There are several case studies in the back of
the book.
• These cases start on page 292
• They offer you an opportunity to apply your
thinking and learn more outside of class
• Class rooms can help you learn, but they may
not always be the best…curiosity with tools
opens more understanding
Review
1. What is Cooperative Strategy?
2. What is a strategic alliance?
3. What does joint venture mean?
4. What is an example of a joint venture?
5. What are reasons for strategic alliances?
Discussion of Corporate Governance
How do you think corporations making more rules
and policies for their companies has influenced
changed the lives of CEO’s and managers?
• In some ways more free
• In some ways easier
• Does rid large problems or cheating
• But more polices can create more decisions for
managers as well as decrease their job
• Important to execute/perform properly (done well
Corporate Governance
• The set of mechanisms used to manage the
relationship among stakeholders and to
determine and control the strategic direction
and performance of organizations.
• Rules, policies, and expectations for the
company
• Making sure core strategies and the company
direction is being accomplished (shareholders
impact)
Relation to Agency Relationships
• Separation between owners and managers
creates an agency relationship
Agency Relationship
• Exists when one or more persons hire another
person or persons as decision-making experts
to perform services
• Shareholders, Executives, Consultants, Insured
Clients (more information on Figure 10.1, pg. 228)
Is it Free Service?
Agency Costs
• The sum of incentive costs, monitoring costs
enforcement costs, and individual financial
losses.
Advantages
• Encourages investments and helps internal
control
Disadvantages
• Can increase costs, too much government
control
Welcome to Day 2 of Week 15!
• Welcome: hope you are awake and ready to
go!
• Review: what did we discuss yesterday?
• Complete Chapter 10: corporate governance
• Start Chapter 11: Organizational Structure
– Check it out on the internet
• Discuss Business Plans
– Work on New items…letter to investors, budget,
and local laws
Review: Do You Remember?
• What is Cooperative Strategy?
– Working together with other businesses to share
resources, technology, skills, capabilities, and more
• What is Corporate Governance?
– Policies, rules, and a system of watching to make
sure decisions are made for the shareholders wealth
(government control and company control)
• What is Agency Relationships?
– When a person is hired to help make decisions for a
company
Separation of Ownership
• Companies several decades ago use to all be
owned by families
– The business would be passed on to a family
member after the owner could not run the
company anymore
• As firms grew larger, “separation of
ownership” began
– Control of the firm changed from entrepreneurs to
professional managers
– Filling jobs with trained people
Group Discussion Time!
Discuss with others around you the following
question. Be ready to write a few answer on the
board.
• Think about and write down as many things
that you know about the board of directors.
– Who are they?
– What do they do?
– Titles, Positions, Power, and more…
Board of Directors Diagram
Shareholders: hold the most power and elect
the board of Directors
• Board of Directors: make the policies, work to
maximize shareholders wealth
– CEO: the most powerful board member
• President: makes day-to-day decisions and activities
– Others such as managers, accountants, CFO, assistant
managers, custodians, maintenance, and other various
employees.
Effectiveness of Board Directors
Many Boards have started making changes to
meet the deeper wants of the shareholders.
• Increases in the diversity of the backgrounds
of board members (diverse, all different)
• Strengthening internal management and
accounting control systems
• More detailed evaluation of the board
• Changing the compensation of the directors
• Bring in outside directors
Executive Compensation: Board
• The techniques used for determining board
members compensation for decision making
all differ.
– There are positive and negative sides of each
technique to decide on what their compensation
total should be
– Even if you find a “good” compensation plan, this
plan will probably not be the same in another
company or country (make shareholders happy)
– Read the article on page 237-238 to see more!
Chapter 11: Organizational Structure
What does the word strategy mean?
• A plan, or idea used to reach a goal
What does structure mean then?
• The specific necessary parts used to build
something larger
Why is it important to know both of these and
their differences?
Different Style of Learning
We will go through several questions from the
back of the book on page 267. The first person
to get the correct answer and explain their
answer to the class will receive a prize next
week.
1. What is organization structure and what are
organizational controls?
2. What are the differences between strategic
controls and financial controls?
Different Style of Learning
3. What does it mean when someone says that
strategy and structure have a reciprocal
relationship?
3. What organizational structures are used to
implement the multidomestic, global, and
transnational international strategies?
3. What is a strategic network?
Feedback on Presentations
In Summary
• Overall, very visual and eye catching
– My attention was fully yours.
Several Areas of Improvements
• Eye Contact
• Too many returns being money (don’t want to lose)
• Some PPT’s were visual, but hard to read
• Everyone needs to participate in talking (only the
spokesperson can speak more)
• Speak to the audience, keep away from just reading
• Speak clear, have a good flow, know your company
Business Plan Report and
Presentation Wrap-Up Discussions
Please Write Down and Discuss with your team
if you have completed the following areas of
your business plan.
• Company Name
• Company Logo/Trademark
• Mission Statement
• Vision Statement
• Competitive Advantage
• Importance of Company and What it does
Business Plan Report and Presentation
Wrap-Up Discussions Continued
Please Write Down and Discuss with your team if you have completed the following
areas of your business plan:
• Location (specific city)
– How it will help the city and area
• Investors
– And what they get in return (not just money)
• 5 Year Business Goals (be realistic)
• Contact Information and Time to meet Outside
of Class
• *Letter to Investors (professional)
• *Budget for 1st and 2nd Year
Make a List of What to Finish
• Improve your information
– Use correct words and grammar
– Does it sound professional?
– Do you know the words and able to explain them in
English and Chinese?
• Write a professional Letter to Investors
– Include info of why to invest and what in return
• Budget for the first 2 years
– Estimate/Guess (realistically) how much money you
need and how much you will spend for each year
• What are the business laws for that city?
– Find out the local laws, requirements, and overall laws
Final Presentation and Report
• Your Presentation and Report do not need to
be the same.
– Your Report will include all the areas of the
business plan and any other extra information you
would like to place in there.
• Your Report must be typed and turned in on
the day of your presentation.
• It must be professional and organized
– Company Name and Names on Front Page Cover
– Page numbers, Titles, Underline, bold, and more
Presentation Details
Your Presentation must be professional and will include
the following things: (at the least)
• Company Name, Presenter Names
– Company Logo/Trademark
• Mission Statement
• Competitive Advantage
– Be creative and realistic…what are your DIFFERNCES
• Importance of Company and What it does
• Location (specific city)
– How it will help the city and area (be creative, show map)
• Investors
– And what they get in return (not just money)
• Budget for 1st and 2nd Year
Rubric
• I will give you a rubric next week for my
expectations of your presentations and
reports.
• The report can be as long as you want, but
make sure it is professional and detailed in
answering each part of your business plan.
• The presentation should be around 10-12
minutes long with everyone speaking during
the presentation.
– Be creative and make a unique presentation
– What will be your competitive advantage in this
presentation to get the highest grade?
Final Exam
• Final Exam will be on December 27th
• Final Presentations and Report are due on
December 26th during class.
– This means the final exam will not be complex.
• Final Presentation are part of final exam score!!!
– Final exam will cover all information after the
midterm exam.
– Review PPT’s
– Look at the website
– Use the book and end chapter summaries
– Use notes and articles
End of the Semester Schedule
• Today, December 12th, we will finish chapter 9
and start working on chapter 10
– Cooperative Strategies and Corporate Governance
• Tomorrow, December 13th, we will finish
chapter 10 and start chapter 11
– Organizational Structure and Controls
• Next Wednesday, December 19th, we will
complete chapter 11 and chapter 12
– Strategic Leadership, Reminder about Cases
Finish the Semester Well
LET IT SNOW!!!! *****
***** ** ***** ** **** **** *** *** *** **
Glad to be your teacher and hope you have a
great weekend!!!
If you have questions, email me and I will try to
answer them as quick as possible!