Why is it typically easier for new businesses to change their business model when compared to more established businesses?

Question

BlackTom AI · Accepted Answer

Exploring why new businesses often find it easier to pivot their business model than established firms involves evaluating each statement through the lens of organizational adaptability.
Option 1: 'They have fewer competitors.' While having fewer competitors can reduce market pressure in the short term, this does not inherently make a business model easier to change. Competition level affects market dynamics but not the internal agility or willingness to implement a model shift.
Option 2: 'They lack a formal business plan.' The absence of a rigid, formal plan can actually create space for experimentation and iterative changes. However, simply lacking a plan does not guarantee ease of change; it may also reflect uncertainty or lack of resources, which can hinder execution. This factor is not a universal driver of easy pivots.
Option 3: 'They are smaller and more agile.' This statement targets structural traits that commonly enable pivoting: smaller size often means fewer entrenched processes, flatter hierarchies, and quicker decision cycles. Agility allows rapid testing, learning, and adjusting the model without needing broad organizational alignment, which typically slows change in larger firms.
Option 4: 'They have the capital to fund such changes.' Access to capital can enable changes, but it is not a defining feature that directly makes change easier. Many startups may fail to secure necessary funds despite attempting pivots, and established firms sometimes have more capital to weather transitions. Capital availability is a relevant constraint, not a universal enabler of ease in changing the model.
In sum, the core reason pivots are typically easier for new ventures lies in organizational size and agility, which streamline decision-making and execution, while the other options describe factors that may influence the process but do not consistently or universally make change easier.

33:382:302:03 INTRO TO ENTREPREN Intro to Entrepreneurship Midterm Exam Fall 2025

Why is it typically easier for new businesses to change their business model when compared to more established businesses?

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33:382:302:03 INTRO TO ENTREPREN Intro to Entrepreneurship Midterm Exam Fall 2025

Why is it typically easier for new businesses to change their business model when compared to more established businesses?

查看解析

登录即可查看完整答案

类似问题

Considering our class discussion and materials, which of the below are correct? (select all that apply)

Considering our class discussion and materials, which of the below are correct? (select all the apply)

What is the difference between a business model and an ebusiness model?

Business models generally discourage experimentation.

How do business models help entrepreneurs create value?

商业模式是关于公司如何为 同时赚取利润。（在空白处输入一个单词。）

Fill in the blank. Write your answer in ALL CAPS. If you are not paying for the product, __________________________.

更多留学生实用工具

希望你的学习变得更简单

商业模式是关于公司如何为同时赚取利润。（在空白处输入一个单词。）