Business Profiles Hershey's Milton Hershey What Innovation Term Paper

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Business Profiles

Hershey's Milton Hershey

What innovation did the Entrepreneur employ to create the successful business? How did the Entrepreneur achieve "sustained competitive advantage"?

Hershey discovered the art of chocolate making at the 1893 World's Columbian Exposition in Chicago. He bought industrial chocolate-making machinery from Germany and arranged for it to be shipped to Lancaster, Pennsylvania and used it to make chocolate coatings for his caramels. After realizing that the public demand for chocolate was greater than the demand for caramel, he transitioned his caramel company to prepare to manufacture chocolate and launched the Hershey Chocolate Company. Initially, his biggest technical challenge was to perfect a viable recipe for making milk chocolate because that process had always been closely guarded by Swiss chocolate makers. Eventually, he developed the right formula of milk, sugar and cocoa.

Describe the personal background of the Entrepreneur and highlight the traits or events that helped him/her succeed.

After the failure of his first candy-making business, Hershey moved to Denver and studied caramel-making with an established confectioner who taught him to perfect caramel from fresh milk. He then started another venture that also failed. But he believed in his ability and persisted until he started the Lancaster Caramel Company that finally succeeded, and eventually employed 1,400 people and shipping nationwide and also worldwide.

3. Describe early failures or personal hardships that may have helped the Entrepreneur be successful.

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As a teenager, Hershey devoted himself to a four-year apprenticeship with a Lancaster, Pennsylvania, candy maker. He then opened his own candy business that failed even though he devoted six years of hard work to it. Despite having no formal education, Hershey obviously believed in his abilities because he persisted even through bankruptcy at the age of 30 and he opened another candy-making business that also failed before he launched the Hershey Chocolate Company.

Term Paper on Business Profiles Hershey's Milton Hershey What Innovation Assignment

4. Describe the academic or industrial preparation that helped the Entrepreneur be successful.

Hershey had no formal education, but he spent four years studying his chosen career by committing to a four-year-long apprenticeship as a teenager. Later, he was imaginative enough to appreciate the potential value of foreign-made machinery that he noticed in Chicago. He then took the initiative to travel to Germany to examine the equipment and study the way that German chocolate makers used it. He invested the necessary funds to import the industrial machinery to the U.S. because he realized the potential value of entering the domestic market with the advantage of superior equipment and industrial processes.

5. Describe the Entrepreneur's personal characteristics that were most important to success.

Obviously, Hershey had the necessary persistence to pursue his dreams even after two initial failures and a bankruptcy early in his career. He also had original insights to appreciate the value of equipment and processes that had never been used in the U.S. And he then demonstrated the patience to perfect the right ingredients and formula to make good chocolate through prolonged experimentation and trial and error. Hershey also succeeded because he genuinely cared about his workers and he made sure that his company town, Hershey Town, Pennsylvania provided benefits to his workers rather than exploiting them the way that many company towns did, especially in is era.

6. Who is in charge of the company now?

Today, John P. Bilbrey is the Executive Vice President, Chief Operating Officer, Interim President and Chief Executive Officer of the Hershey Company. He joined the company in 2003 as Senior Vice President, President Hershey International. He was promoted to Senior Vice President, President International Commercial Group in 2005, and then to Senior Vice President, President Hershey North America two years later. In 2010, he was promoted to Executive Vice President, Chief Operating Officer. Most recently, in 2011, Bilbrey was appointed interim President and Chief Executive Officer.

7. Describe any "barriers of entry," competition or marketing challenges the Entrepreneur overcame.

The initial barriers that Hershey faced had to do with building his successful Caramel company after two failures and bankruptcy. Then, even after taking the initiative to import superior quality machinery from Germany, he still spent years experimenting because foreign chocolate makers would not share their proprietary recipes for chocolate making. When he was ready to open his company, he still had to find the right location and he knew to select a port city within convenient location of the raw ingredients he needed as well as one that had a large population of hard-working people.

8. Describe how the Entrepreneur became to believe that a market existed for this product or service.

At first, Hershey planned to use his new German equipment just to make coatings for his caramel candy. He quickly realized that the new chocolate he was making actually was more in demand than caramel. He sold his caramel company and opened the Hershey Chocolate Company, producing chocolate at a price that was affordable to all, whereas previously, it had been a luxury food available mainly to the wealthy.

9. Describe the resources/assets/team the Entrepreneur required to launch this business.

Hershey's principal resources were his commitment to learning his intended craft at a very early age, his persistence after repeated failure, his open-mindedness to new ideas, his realization of potential marketing opportunities dictated by observed patterns of consumer demand, and his hard work in perfecting an original recipe.

10. Describe the role of family in the success of the entrepreneur.

Hershey's family of origin was not particularly helpful in his success but his experiences growing up in a poor farming family and without any opportunity for education made him realize how important it was to provide opportunities for other in similarly unfortunate circumstances. In that regard, his wife Catherine worked with him to open the Hershey Industrial School for orphan boys and he financed quality elementary and secondary schools. Before his death he devoted most of his great wealth to a charitable trust to continue his legacy of philanthropy.

Wal-Mart's Sam Walton

1. What innovation did the Entrepreneur employ to create the successful business? How did the Entrepreneur achieve "sustained competitive advantage"?

Walton had the insight to locate his first Wal-Mart close enough to its distribution center to enable efficient and fast restocking. He also expanded his business by leveraging precise combination of bank debt and vendor money. He managed to turn product around so fast that he was able to use the available time required to pay vendors to his advantage as, essentially, interest free 3-week loans.

2. Describe the personal background of the Entrepreneur and highlight the traits or events that helped him/her succeed.

Walton worked very hard to support himself in college. Later, he used his first position as a manager for J.C. Penney to learn about his industry and he devoted himself to self-study when he could not afford to attend business school.

3. Describe early failures or personal hardships that may have helped the Entrepreneur be successful.

Walton had the confidence and persistence to open his own business after being rejected by the founder of a successful retail discount chain who he had approached offering a partnership. By focusing on supply chain management, Walton managed to grow his business far beyond what seemed possible from his initial investment without any assistance.

4. Describe the academic or industrial preparation that helped the Entrepreneur be successful.

Walton graduated from the University of Missouri where he worked at many different jobs to afford the tuition. He worked as a lifeguard and as a waiter, and he also managed a newspaper delivery route in which he delivered to 160 customers. He could not afford to study business at the Wharton School of Business so he began working as a manager trainee at J.C. Penney where he studied retail management on the job.

5. Describe the Entrepreneur's personal characteristics that were most important… [END OF PREVIEW] . . . READ MORE

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