The 4 Freedoms That Motivate Successful Entrepreneurs
The objective of this study is to highlight the importance of the use of BMC to the entrepreneurs and the academic world. In pursuing this objective, the authors want to discuss the BMC problems and criticism and show its variations in order to help entrepreneurs use these models in the right way ‚and successfully plan their businesses. The shortcomings and weaknesses of the model will then be compared with experiences made in the class ‘Entrepreneurship II’ offered in a undergrad course of Business at a Brazilian university in the state of São Paulo. The experience with them highlighted the importance of the use of BMC and it was helpful in developing their business plans. The contribution of this study to the body of knowledge is to fill the vacuum that exists in terms of academic study concerning the use of Business Model Canvas by the entrepreneurs when developing their business plan as well as to advance research in the areas of small and medium enterprises.
Peter F. Drucker (1909–2005) has always been considered one of the authority figures in the field of entrepreneurship, and, besides his success as a businessman, he is also famous for a thriving career as an author of multiple best-selling books, among which “The Essential Drucker”, “Managing Oneself” and “The Effective Executive”. Published for the first time in 1985, Innovation and Entrepreneurship has probably been the first book to argue that, instead of being a random, occasional, once-in-a-while process, innovation is and must be a purposeful and systematic effort instead, one that can lead established businesses, service institutions and new ventures to success in the new economy.
“1. Entrepreneurs are everywhere. You don’t have to work in a garage to be in a startup. The concept of entrepreneurship includes anyone who works within my definition of a startup: a human institution designed to create new products and services under conditions of extreme uncertainty. That means entrepreneurs are everywhere and the Lean Startup approach can work in any size company, even a very large enterprise, in any sector or industry.
2. Entrepreneurship is management. A startup is an institution, not just a product, and so it requires a new kind of management specifically geared to its context of extreme uncertainty. In fact, as I will argue later, I believe “entrepreneur” should be considered a job title in all modern companies that depend on innovation for their future growth.
3. Validated learning. Startups exist not just to make stuff, make money, or even serve customers. They exist to learn how to build a sustainable business. This learning can be validated scientifically by running frequent experiments that allow entrepreneurs to test each element of their vision.
4. Build-Measure-Learn. The fundamental activity of a startup is to turn ideas into products, measure how customers respond, and then learn whether to pivot or persevere. All successful startup processes should be geared to accelerate that feedback loop.
5. Innovation accounting. To improve entrepreneurial outcomes and hold innovators accountable, we need to focus on the boring stuff: how to measure progress, how to set up milestones, and how to prioritize work. This requires a new kind of accounting designed for startups—and the people who hold them accountable.”
— Eric Ries – The Lean Startup