Module:

Entrepreneurship
Dr Tamer Karam
Essentials of Entrepreneurship and Small
Business Management
Eighth Edition
Section 1: The Challenge of Entrepreneurship

Chapter 3
Inside the
Entrepreneurial
Mind: From Ideas
to Reality

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Learning Objectives (1 of 2)
1. Explain the differences among
creativity, innovation, and
entrepreneurship.
2. Describe why creativity and
innovation are such an integral
part of entrepreneurship.
3. Understand how the two
hemispheres of the human brain
function and what role they play
in creativity.
4. Explain the 10 “metal locks” that
limit individual creativity.
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Learning Objectives (2 of 2)
5. Understand how entrepreneurs can enhance the
creativity of their employees as well as their own
creativity.
6. Describe the steps in the creative process.
7. Discuss techniques for improving the creative process.
8. Describe the protection of intellectual property through
patents, trademarks, and copyrights.

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Creativity and Innovation
• Creativity: the ability to develop new ideas and to
discover new ways of looking at problems and
opportunities; thinking new things.
• Innovation: the ability to apply creative solutions to
problems or opportunities to enhance or to enrich
people’s lives; doing new things.

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Entrepreneurship
• Entrepreneurship: the result of a disciplined, systematic
process of applying creativity and innovation to the
needs and opportunities in the marketplace.
• Entrepreneurs connect their creative ideas with the
purposeful action and structure of a business.

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Failure: Part of the Creative Process!
• Most ideas don’t work and most innovations fail
• For every 5,000 to 10,000 new drug discoveries:
– 250 get to preclinical trials
– 5 make it to clinical trials
– 1 or 2 are reviewed by the FDA
– Only 1 gets to market
• Failure is part of the creative process

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The dark side of
entrepreneurship

?
• Do entrepreneurs suffer more from
mental disorders?
• Does it take a little bit of madness
to start a business?
• Can a business can drive one a
little bit mad?
Creativity: Essential to Survival
• Creativity is an important source of building a
competitive
advantage

• Can we learn to be creative? Yes!

• By overcoming paradigms and by suspending
conventional thinking long enough to consider new and
different alternatives

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Right-Brained, Creative Thinkers (1 of 3)
• Always ask: “Is there a better way?”
• Challenge custom, routine, and tradition.
• Are reflective.
• Are prolific thinkers.
• Play mental games.

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Right-Brained, Creative Thinkers (2 of 3)
• Realize that there may be more than one “right”
answer.
• Know that mistakes are pit stops on the way to
success.
• Recognize that problems are springboards for new
ideas.

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Right-Brained, Creative Thinkers (3 of 3)
• Understand that failure is a natural part of the creative
process.
• Have “helicopter skills.”
• Relate seemingly unrelated ideas to a problem.

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Left-Brained or Right-Brained?
• Entrepreneurship requires both left-and right-
brained
thinking.
– Right-brained thinking draws on divergent
reasoning, the ability to create a multitude of original,
diverse ideas.
– Left-brained thinking counts on convergent
reasoning, the ability to evaluate multiple ideas and to
choose the best solution to a problem.

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Barriers to Creativity (1 of 2)
• Searching for the one “right” answer
• Focusing on “being logical”
• Blindly following the rules
• Constantly being practical
• Viewing play as frivolous

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Barriers to Creativity (2 of 2)
• Becoming overly specialized
• Avoiding ambiguity
• Fearing looking foolish
• Fearing mistakes and failure
• Believing that “I’m not creative”

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Spurring the Imagination (1 of 3)
• Questions to ask:
– Is there a new way to do it?
– Can you borrow or adapt it?
– Can you give it a new twist?
– Do you merely need more of the same?
– Do you need less of the same?

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Spurring the Imagination (2 of 3)
• Is there a substitute?
• Can you rearrange the parts?
• What if you do just the opposite?
• Can you combine ideas?
• Can you put it to other uses?
• What else could you make from this?

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Spurring the Imagination (3 of 3)
• Are there other markets for it?
• Can you reverse it?
• Can you eliminate it?
• Can you put it to another use?
• What idea seems impossible, but if executed, would
revolutionize your business?

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Enhancing Organizational Creativity (1 of 4)
Figure 3.3 Factors That Contribute to Companies’ Ability to
Innovate

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Enhancing Organizational Creativity (2 of 4)
• Include creativity as a core company value.
• Hire for creativity.
• Create an organizational structure that nourishes
creativity.
• Embrace diversity.
• Expect creativity.
• Expect and tolerate failure.

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Enhancing Organizational Creativity (3 of 4)
• Incorporate fun into the work environment.
• Encourage curiosity.
• Design a work space that encourages creativity.
• View problems as opportunities.
• Provide creativity training.
• Provide support.
• Develop a procedure for capturing ideas.

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Enhancing Organizational Creativity (4 of 4)
• Talk and interact with customers.
• Reward creativity.
• Model creative behavior.
• Monitor emerging trends and identify ways your
company can capitalize on them.
• Look for uses for your product or service in other
markets.
• Don’t forget about business model innovation.

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Enhancing Individual Creativity (1 of 4)
• Allow yourself to be creative.
• Forget the “rules.”
• Give your mind fresh input every day.
• Take up a hobby.
• Travel and observe.
• Observe the products and services of other companies,
especially those in completely different markets.

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Enhancing Individual Creativity (2 of 4)
• Recognize the creative power of mistakes.
• Notice what is missing.
• Look for ways to turn trash into treasure.
• Keep a journal handy to record your thoughts and
ideas.
• Listen to other people.
• Listen to customers.
• Get adequate sleep.

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Enhancing Individual Creativity (3 of 4)
• Watch a movie.
• Talk to a child.
• Do something ordinary in an unusual way.
• Keep a toy box in your office.
• Take note of your “pain” points.
• Do not throw away seemingly “bad” ideas.

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Enhancing Individual Creativity (4 of 4)
• Collaborate with others.
• Read books on stimulating creativity or take a
class on creativity.
• Doodle.
• Take some time off.
• Be persistent.

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The Creative Process
1. Preparation
2. Investigation
3. Transformation
4. Incubation
5. Illumination
6. Verification
7. Implementation

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Preparation
• Get your mind ready for creative thinking.
– Adopt the attitude of a lifelong student.
– Read … a lot … and not just in your field of
expertise.
– Clip articles of interest to you and save them.
– Develop your listening skills.
– Join professional or trade associations and
attend their meetings.
– Eliminate creative distractions.
– Take time to discuss your ideas with other
people.
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Transformation
• Involves viewing both the similarities and the
differences
among the information collected.
• Two types of thinking are required:
– Convergent: the ability to see the similarities and the
connections among various and often diverse data and
events.
– Divergent: the ability to see the differences among
various data and events.

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Transformation
• How can you transform information into purposeful
ideas?
– Grasp the “big picture” by looking for patterns that
emerge.
– Rearrange the elements of the situation.
– Use synectics: taking two seeming nonsensical
ideas and combining them.
– Remember that several approaches can be
successful. If one fails, jump to another.

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Incubation
• Allow your subconscious to reflect on the
information
collected.
– Walk away from the situation.
– Take the time to daydream.
– Relax – and play – regularly.
– Dream about the problem or opportunity.
– Work on the problem in a different environment.

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Verification (1 of 2)
• Validate the idea as accurate and useful.
– Is it really a better solution?
– Will it work?
– Is there a need for it?
– If so, what is the best application of this idea in the
marketplace?

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Verification (2 of 2)
• Does this product or service fit into our core
competencies?
• How much will it cost to produce or to provide?
• Can we sell it at a reasonable price that will
produce a
profit?
• Will people buy it?

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Techniques for Improving the
Creative Process (2 of 4)
• Brainstorming
• Mind-mapping
• Force-Field analysis
• TRIZ
• Rapid prototyping

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Techniques for Improving the
Creative Process (1 of 4)
Brainstorming:
• The goal is to create a large quantity of novel and
imaginative ideas.

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Brainstorming Guidelines (1 of 2)
• Keep the group small – “Two pizza rule.”
• Make the group as diverse as possible.
• Do aerobic exercise before the session.
• Emphasize that company rank is irrelevant.
• Have a well-defined problem: why, how, what.
• Provide relevant background material.
• Limit the session to 40 to 60 minutes.
• Take a field trip.

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Brainstorming Guidelines (2 of 2)
• Appoint a recorder.
• Throw logic out the window.
• Encourage all ideas from the team.
• Shoot for quantity of ideas over quality of ideas.
• Use a circular or U-shaped seating pattern.
• Forbid criticism.
• Encourage idea “hitch-hiking.”
• Dare to imagine the unreasonable.

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Mind-Mapping
Mind-mapping:
• A graphical technique that encourages thinking on both
sides of the brain, visually displays relationships among
ideas, and improves the ability to see a problem from
many sides.

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The Mind-Mapping Process
• Start by writing down or sketching a picture
symbolizing the problem or area of focus in the center
of a blank page.
• Work as quickly as possible and write down every idea
that comes into your mind for 20 minutes, connecting
each to the central picture or words with a line.
• Don’t try to force creativity.
• After a brief rest, begin to integrate the ideas into a
mind
map.

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Force-Field Analysis
• Force-Field Analysis
– A useful technique for evaluating the forces
that support and oppose a proposed
change.
– Three columns:
§ Center: Problem to be addressed
§ Left: Driving forces
§ Right: Restraining forces
– Score each force (-1 to +4) and add them.

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Sample Force-Field Analysis
Figure 3.4 Sample Force-Field Analysis

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TRIZ
• TRIZ
– A systematic approach designed to solve any
technical problem.
– Relies on 40 principles and left-brained thinking to
solve problems.

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TRIZ Contradiction Matrix
Figure 3.5 TRIZ Contradiction Matrix

Source: Based on, G. Altshuller, TRIZ 40, http://www.triz40.com/aff_Matrix.htm.

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Rapid Prototyping
Rapid Prototyping:
• Transforming an idea into an actual model that will
point out flaws and lead to design improvements.

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Protecting Your Ideas (1 of 3)
Patent:
• A grant from the Patent and Trademark Office to the
inventor of product, giving the exclusive right to make,
use, or sell the invention for 20 years from the date of
filing the patent application.

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Patent Applications and Patents
Issued
Figure 3.6 Patent Applications and Patents Issued

Source: U.S. Patent and Trademark Office, 2014.

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The Six Steps to a Patent
1. Establish the invention’s novelty
2. Document the device
3. Search existing patents
4. Study search results
5. Complete the patent application
6. File the patent application

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Protecting Your Ideas (2 of 3)
• Trademark: any distinctive word, symbol, design, name,
logo, slogan, or trade dress a company uses to identify the
origin of a product or to distinguish it from other goods on
the market.
• Service mark: the same as a trademark except that it
identifies the source of a service rather than a product.

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Trademark Applications and
Trademarks and Renewals Issued
Figure 3.8 Trademark Applications and Trademarks and Renewals Issued

Source: US Patent and Trademark Office, 2014.

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Protecting Your Ideas (3 of 3)
• Copyright: an exclusive right that protects the creators of
original works of authorship such as literary, dramatic,
musical, and artistic works.
– Copyrighted material is denoted by the symbol ©.

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Protecting Intellectual Property
• The primary weapon an entrepreneur has to protect
patents, trademarks, and copyrights is the legal system.
• Before engaging in a legal battle consider:
– Can the opponent afford to pay if you win?
– Do you expect to win enough to cover your legal
costs?
– Can you afford the loss of time, money, and
privacy involved?

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Characteristics of Patents,
Trademarks, and Copyrights (1 of 2)
Table 3.3 Characteristics of Patents, Trademarks, and Copyrights

Protection What It Protects Who Is Eligible Length of Approximate Cost

Protection
Utility Patent Exclusive right to make, use, First person to file 20 years $4,000 to $25,000,
and sell an invention for a patent depending on
complexity
Design Patent New, original changes in the First person to file 14 years $4,000 to $25,000,
design of existing products for a patent depending on
that enhance their sales complexity

Trademark Any distinctive word, phrase, Entity currently Renewable $1,000 to $2,500
symbol, design, name, logo, using the mark in between 5th and
slogan, or trade dress that a commerce or one 6th years and 9th
company uses to identify the who intends to use it and 10th years and
origin of a product or to within six months every 10 years
distinguish it from other afterward
goods on the market

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Characteristics of Patents,
Trademarks, and Copyrights (2 of 2)
[Table 3.3 continued]

Protection What It Protects Who Is Eligible Length of Approximate

Protection Cost
Service mark Same protection as a Entity currently Renewable $1,000 to $2,500
trademark except that using the mark in between 5th and
it identifies and commerce or one 6th years and 9th
distinguishes the who intends to use and 10th years
source of a service it within six and every 10
rather than a product months years afterward
Copyright Original works of Author or creator Life of the author $140 to $200
authorship, such as or creator plus 70
literary, dramatic, years
musical, and artistic
works

Source: Based on “Idea Factories,” Inc., September 2013, pp. 104–105.

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Conclusion
• The creative process is a tenant of the entrepreneurial
experience.
• Success, and even survival itself, requires entrepreneurs
to tap their creativity.
• The seven steps of the creative process transform an idea
into a business reality.
• Creativity results in value, and value provides a
competitive advantage.
• Entrepreneurs protect their creative ideas with patents,
trademarks, service marks, and copyrights to sustain a
competitive edge.
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