Monthly Archives: November 2013

How Entrepreneurial is Orange County?

John Bradley Jackson, Director of the CSUF Center for Entrepreneurship, reviewed the findings of a recent study about Entrepreneurship in Orange County. The presentation happened at the November 20, 2013 meeting of SCORE’s Orange County Chapter. The local SCORE chapter is the nation’s largest and most productive chapter of the SBA funded organization which is dedicated to the formation, growth and success of small business.

Jackson discussed how Orange County compares to other regions in the U.S. when viewed from a new venture perspective. Other regions studied include Silicon Valley, Route 128 in Boston and Austin.  He first reviewed small business in the USA and their significance to the economy; the home based businesses and the “solopreneurs” were cited as little known catalysts in our economic recovery.

  • 28 million small businesses in the US
  • Over 50% of the working population in a small business
  • 52% of all small businesses are home-based

Next he addressed the myth of the low survival rate of small businesses. Jackson said, “It is urban legend that most small businesses fail in the first two years.” He cited that following SBA data:

  • 70% of new ventures survive at least 2 years
  • 50% of new ventures survive at least 5 years
  • 33% of new ventures survive at least 10 years

Patent activity, a leading indicator of successful entrepreneurship is on the increase in OC. In 2012, there were 2,300 patents granted to Orange County inventors which was up 48% from 1,500 in 2007. This steady increase clearly reflects on the innovative culture found in Orange County.

In fact, the Kauffman Foundation, the leading entrepreneurship think tank, identified that that there 530 entrepreneurs per 100,000 Orange and Los Angeles County residents making it the 2nd most entrepreneurial region in the USA among similarly sized Metropolitan Statistical Areas.  The statistic factors new business starts, financial events, and other entrepreneurial factors into its rankings.

“Yet, Orange County is different than the other hotbeds of entrepreneurship. OC has an unusually high immigrant population, a very large number of small to medium sized businesses, a Low number of Fortune 1,000 headquartered firms, and a very large number of family businesses. All this makes for a thriving local economy but one with an overall lower number of IPOs and other capital events.”

Jackson theorized, “Orange County is ‘sticky’ which means that the businesses formed in OC grow and thrive but many remain privately held and passed on to the next generation.  So, is Orange County entrepreneurial?  Absolutely.”

 

Let a CSUF Organizational Audit help your Business Reach new Heights!

Employees are a company’s most important asset but all too often they aren’t treated as such. Over the last couple of years our program – which has been in operation for more than two decades and has a strong record of helping clients – has developed a comprehensive Organizational Audit consulting service that helps our clients increase the effectiveness of its most important asset: its people.

The audit starts with the work that your employees need to do in order to achieve the organization’s goals and then asks:

1. Are the right people in place to get this work done successfully?

Our students can recommend changes to the current hiring and training processes to ensure that your people have the right skills and abilities to get the job done.

2. Are the policies and procedures that have been put in place helping the staff work more effectively?

Our students can recommend changes to improve the flow of communication within the organization and increase employee motivation.

3. Is the culture enhancing or hindering organizational performance?

The secret-sauce of an effective organization is its culture. When employees strongly agree with the organization’s values, they are much more energized to help the organization achieve its goals. Our students can recommend ways to create a culture that helps your organization gain a unique competitive advantage that is almost impossible to imitate.

Each CSUF Student-led Business Consulting team that will be performing these comprehensive Organizational Audits are supervised by a PhD faculty member and are mentored by a qualified professional from the private sector. By the end of the semester, the CSUF Undergraduate Juniors and Seniors will develop and present to their clients a plan that will address all the above issues with recommendations about how to make improvements.

Our Student Consulting Program has won 26 awards from the nationally renowned Small Business Institute for having some of the best, if not the best, student consulting projects. Please click on the picture below to see a video describing our Student Consulting Program:

CSUF’s “Organizational Audit” is a top notch tool for any company. Please call Ms. Charlesetta Medina at (657) 278-8243 or send her an email to entrepreneurship@fullerton.edu for more information about our award-winning Student Consulting Program.

Yelp – The Good

Social media is becoming an increasingly powerful force that business owners – especially small business owners – cannot afford to ignore. There is an increasing body of work suggesting that online mentions and discussions about a particular business can meaningfully affect the business’s revenues. For instance, studies have shown that chatter on Twitter about a movie can effectively predict its box-office revenue and that online activity can predict sales of books.

Arguably, the most important resource for consumers is the online review site Yelp. The popular site allows visitors to view and create reviews for almost any type of business. And Yelp allows anyone to create a listing for your business. Anyone who steps foot through your door, passes by you on the street, or reads your name in the paper can create a business listing. Given how easy it is for others to start posting reviews about a business and the significant economic consequences of these reviews, it is crucial for business owners to embrace Yelp.

Specifically, here are three reasons why Yelp matters:

1. It contains authentic reviews

While as many as one out of every four Yelp reviews are fake, the rest are authentic. In other words, the majority of Yelp reviews are from actual customers who are sharing their actual experience with your product or service. After reading through all the reviews you will be able to decipher what your customers like about your business and what are the areas of improvement. This information is extremely valuable and, best of all, is available to you at no cost or effort. While its most obvious use is to make adjustments that will improve customer satisfaction, it can also be used in other ways. For instance, it can help identify your outstanding employees so that they can be rewarded.

2. It strongly predicts intention to buy

According to data released in June of 2013 by Nielsen , 82% of users consult Yelp reviews when they are ready to make a purchase. This means that Yelp is the top searched site when it comes to product or service reviews. Greater than that, 93% of consumers always, frequently, or occasionally purchase from a local business after visiting it on Yelp and 89% make that purchase within a week.

3. Yelp users are, in many ways, the ideal customers

Yelp users are ideal candidates for many industries. 57% of Yelp users have a college degree and the mean household income for users is $68,000. This audience mix is an ideal target market in many regards. The consumer is educated and has disposable income to spend.

To harness the power of Yelp, entrepreneurs should frequently check their business’ reviews. These reviews are an opportunity to build customer engagement and show potential customers that your business strives to satisfy its customers. A good place to start is to reach out to customers that have written positive reviews about your business. A simple thank you note emailed to each customer is a wonderful way to show them that you value their business and the time they took to write a review about their experience.

(The next post in this series will discuss a more challenging issue: how to respond to negative reviews.)

Written by Katie Nino and Dr. Atul Teckchandani

Note: This is the first of a series of posts about the importance of Yelp and other review sites and how entrepreneurs can manage their presence on these sites in a manner that increases their firm’s reputation and sales. It was co-authored with Katie Nino, Social Media Adviser for the Imperial Valley Small Business Development Center and graduate of the Entrepreneurship program at CSUF (class of 2011) and Dr. Atul Teckchandani, Assistant Professor of Management at the Mihaylo College of Business and Economics, California State University, Fullerton.

[Image: Street Fight]

Yelp Series:

Yelp – The Good

Yelp – The Bad

Yelp – The Ugly

Hunan University visits CSUF and FastStart.studio

A delegation of MBA students from Hunan University visited CSUF a couple of weeks ago. John Bradley Jackson, the Director for the Center for Entrepreneurship and a Professor of Marketing and Entrepreneurship at Cal State Fullerton, delivered a seminar to our visitors focusing on the state of entrepreneurship in America, California and in Orange County as well. Here are a couple of the slides from that seminar:

During their visit, the Hunan University Delegation not only was able to visit the Cal State Fullerton main campus but they also had the change to visit a business incubator. Below are some pictures of their visit to CSUF and to FastStart.studio, the business incubator.

Professor JJ with visitors from Hunan University.

Owner of business incubator FastStart.studio, Michael Sawitz, giving a presentation to visitors from Hunan University.

Director Jackson, Michael Sawitz and delegation from Hunan University

Leveraging the CSUF Entrepreneurship Alum Network

The CSUF Entrepreneurship Program has many great friends and one of those friends, Entrepreneur Elympics, has a lot to be proud of. In the picture below, every person either is or graduated from CSUF and works/interns at Entrepreneur Elympics or one of their partner companies. Entrepreneur Elympics met these people through our Student-led Business Consulting Program and the company’s leaders were so impressed with the work done for them that they decided to hire on these people.

(From Left to Right: Quinn Royston, Will Cosmo, Matthew Gallizzi, Robert Gates, Angelo Catsouras, Patrick Hayes, Cameron Mahdad, Joshua Behnke, Annie Nguyen, Jorge Zendejas and Trevor Heath.)

Entrepreneur Elympics will be powering the voting functionality for our upcoming Fast Pitch Competition (details forthcoming). Entrepreneur Elympics is a startup that started out in our Student-led Business Consulting Program. Many other new ventures have been clients in our Student-led Business Consulting Program as well and, based solely on the picture above, you can see that involvement in our program can benefit everyone involved.

Entrepreneur Elympics recognizes the value of the CSUF Entrepreneurship program which provides a win/win scenario for our grads and current students. Well done!

BUAD 410 – Starting and Managing a Small Business

Most of the students who are reading this are probably business majors and, as business majors, I’m sure that your non-business major friends have asked you what it takes to run a business. You explain the basics to them as best you can but there’s no way you are able to go into enough depth to really help them. Starting now, you can tell your non-business major friends who want to know how to run a business that there is a class for them.

Starting in the Spring 2014 semester, CSUF will offer a class designed to help non-business majors learn how to run a business:

BUAD 410 – Starting and Managing a Professional Practice/Small Business

The purpose of this course is as follows:

BUAD 410 will introduce students to the fundamentals of starting and managing a professional practice / small business including:  planning, raising capital, using business information, managing employees, and marketing products and services. The course is oriented toward individuals who desire to start and operate a professional practice / small business. The class targets non-business majors who have an interest in starting their own professional practice or small business after graduation.

Students in this class will be exposed to the following elements:

  • Business Concept
  • Business Feasibility
  • Legal Issues
  • Marketing the practice of Small Business
  • Finance
  • Tax Issues
  • Managing Risk
  • The Business Plan

There are still a few openings left in this class for the upcoming Spring semester so make sure to sign up before it’s too late!

Junior or senior status is required to take this class. For more information about this class please contact Professor Jackson at 657-278-8413.

Why Human Resource Practices are Important

While it is fairly obvious how marketing, sales, product development and manufacturing contribute to an organization’s success, the link between human resources and firm success has been much more ambiguous. Measuring how the sales department affects a firm’s revenues is quite simple. But it’s much harder to measure the effects of changes in hiring, training, performance appraisal and information sharing processes.

The most conclusive proof of value of human resources came via a paper published last year in the Academy of Management Journal. The authors used meta-analysis techniques to provide strong evidence for the concrete benefits to firms when they take care of their people. (Meta-analysis is a fancy word for a methodology that allows researchers to combine results from many different studies to look for broader patterns.)

Examining 116 articles published between 1985 and 2011, the authors found that an organization’s human resource policies improve employee motivation and build a strong pool of talent. These two factors, in turn, lead to reduced employee turnover and better operational outcomes such as productivity, product or service quality, and rate of innovation. And, when the organization’s employees are productive, innovative and committed to delivering high-quality products and services to its customers, the organization will see increased revenues.

How can an organization improve its bottom line by taking care of its people? The authors suggest three basic strategies:

  1. Create recruiting, hiring and training processes that ensure that employees have the right skills to get the job done.
  2. Design rewards and career development programs so that they enhance employee motivation.
  3. Provide employees with opportunities to grow their skills and abilities in a manner that also achieves the organization’s objectives. Some examples include giving workers a fair degree of autonomy in how they do their jobs and allowing them to have a say in matters that affect them.

Let’s face it, many of us think of HR as the place we go to when we want to change our benefits or our paycheck doesn’t look right. This study provides the most convincing evidence yet of the true value provided by HR.

If you are interested in improving your company’s Human Resource Practices please get in touch with Charlesetta Medina by sending her an email to cymedina@fullerton.edu or by giving her a call at (657) 278-3464. Our award winning Student-led Business Consulting program accepts new clients during both the spring and fall semesters but space is limited so plan ahead.

Written by Dr. Atul Teckchandani who is an Assistant Professor of Management at the Mihaylo College of Business and Economics, California State University, Fullerton. He teaches courses in entrepreneurship, provides student advising and is involved with the Center for Entrepreneurship within Mihaylo College. He has a PhD in Business Administration (Management of Organizations) from the Haas School of Business at the University of California, Berkeley, as well as an MBA from the McCombs School of Business at the University of Texas, Austin.