Module: Entrepreneurship

Topic: Creativity and

the Business Idea

Kashif Ali
Department of Business Administration
[email protected]

Week 3

1
 Learning Objectives
• To identify various sources of ideas for new
ventures.
• To discuss methods for generating new
venture ideas.
• To discuss creativity and creative problem-
solving techniques.
• To discuss the importance of innovation.
• To understand and be able to develop an
opportunity assessment plan.
Learning Objectives (cont’d)
• To discuss the aspects of the product
planning and development process.
• To discuss aspects of e-commerce.
 Trends

• The start of a trend that lasts for a considerable

period of time provides one of the greatest
opportunities for starting a new venture.
• Trends that will provide opportunities include: green
trend, clean-energy trend, organic-orientation trend,
economic trend, social trend, health trend, and Web
trend.
 Sources of New Ideas
• Consumers
– Informally monitor potential ideas and needs.
– Formally arrange for consumers to express their
opinions.
• Existing Products and Services
– Analysis uncovers ways to improve offerings that may
result in a new product or service.
• Distribution Channels
– Channel members can help suggest and market new
products.
 Sources of New Ideas
(Cont’d)
• Federal Government
– Files of the Patent Office can suggest new product
possibilities.
– New product ideas can come in response to
government regulations.
• Research and Development
– A formal endeavor connected with one’s current
employment.
– An informal lab in a basement or garage.
Methods of Generating New
Ideas
• Focus Groups
– A moderator leads a group of 8 to 14 participants
through an open, in-depth discussion in a directive or
nondirective manner.
– An excellent method for generating and screening
ideas and concepts.
Methods of Generating New
Ideas (Cont’d)
• Brainstorming
– Allows people to be stimulated to greater creativity.
– Good ideas emerge when the brainstorming effort
focuses on a specific product or market area.
• Rules of brainstorming:
– No criticism.
– Freewheeling is encouraged.
– Quantity of ideas is desired.
– Combinations and improvements of ideas are
encouraged.
Methods of Generating New
Ideas (Cont’d)
• Brainwriting
– A form of written brainstorming.
– Participants write their ideas on special forms or cards
that circulate within the group.
• Problem Inventory Analysis
– Consumers are provided with a list of problems and
are asked to identify products that have those
problems.
– Results must be carefully evaluated as they may not
actually reflect a new business opportunity.
 Creative Problem Solving
• Creativity tends to decline with age, education, lack
of use, and bureaucracy.
• Latent creative potential can be stifled by
perceptual, cultural, emotional, and organizational
factors.
• Creativity can be unlocked by using any of the
creative problem-solving techniques.
 Creative Problem Solving
(Cont’d)
• Brainstorming
– Session starts with a problem statement.
– No group member should be an expert in the field of
the problem.
– All ideas must be recorded.
• Reverse Brainstorming
– A group method that focuses on the negative aspects
of a product, service, or idea as well as ways to
overcome these problems.
– Care must be taken to maintain group morale .
 Creative Problem Solving
(Cont’d)
• Gordon Method
– Method for developing new ideas when the group
members are unaware of exact nature other problem.
• Checklist Method
– Developing a new idea through a list of related issues.
• Free Association
– Developing a new idea through a chain of word
associations.
 Creative Problem Solving
(Cont’d)
• Forced Relationships
– Developing a new idea by looking at product
combinations.
– A five step process which focuses on generating
ideas from relationship patterns between elements of
a problem.
• Collective Notebook Method
– Developing a new idea by group members regularly
recording ideas.
 Creative Problem Solving
(Cont’d)
• Attribute Listing
– Developing a new idea by looking at the positives and
negatives.
• Big-Dream Approach
– Developing a new idea by thinking without constraints.
• Parameter Analysis
– Developing a new idea by focusing on parameter
identification and creative synthesis.
Illustration of Parameter
Analysis
 Innovation
Types of Innovation
•Breakthrough
– Fewest number of innovations.(extremely unique)
– Establishes the platform on which future innovations
in an area are developed.
– Should be protected by patents, trademarks, and
copyrights.1
•Technological
– Occurs more frequently; not at the same level of
breakthrough inventions.
– Offers advancements in the product/market area.
– Needs to be protected.
 Innovation (Cont’d)
• Ordinary
– Occurs most frequently.
– Extends a technological innovation into a better
product or service or one that has a different market
appeal.
– Usually come from market analysis and pull, not
technology push.
 Innovation (Cont’d)
Defining a New Innovation (Product or
Service)
•Newness can be:
– In the consumer concept.
– A change in the package or container.
– Slight changes or modifications in the appearance of
the product. (Industrial market)
•Companies also add products to their product line
that are already marketed by other companies;
products are new to the manufacturer but not the
consumer.
 Innovation (Cont’d)
Classification of New Products
•Consumer’s Viewpoint
– The continuum proposed by Thomas Robertson is
based on the disrupting influence that use of the
product has on established consumption patterns.
• Continuous innovations.
• Dynamically continuous.
• Discontinuous innovations.
•This approach is consistent with the marketing
philosophy that “satisfaction of consumer needs” is
fundamental to a venture’s existence.
Continuum for Classifying
New Products
 Innovation (Cont’d)
• Firm’s Viewpoint
– Distinction can be made between new products and
new markets.
– Situations with a new technology and a new market
are the most complicated and pose the highest
degree of risk.
New Product Classification
System
A Model of the Opportunity
Recognition Process
 Product Planning and
Development Process
Establishing Evaluation Criteria
•Criteria should be established at each stage of the
product planning and development process.
•It should be all-inclusive and quantitative in nature.
•Criteria should evaluate the idea in terms of:
– Market opportunity.
– Competition.
– Marketing system.
– Financial factors.
– Production factors.
The Product Planning and
Development Process
 Product Planning and
Development Process(Cont’d)
Idea Stage
•Promising ideas should be identified and impractical
ones eliminated.
•Evaluation method – Systematic market evaluation
checklist.
•Determine the need for the new idea as well as its
value to the company.

Concept Stage
•Refined idea is tested to determine consumer
acceptance which can be measured through the
conversational interview method.
 Product Planning and
Development Process(Cont’d)
Product Development Stage
•Consumer reaction to the product/service is
determined.
•A consumer panel is given a product sample and
preference is determined through methods such as
multiple brand comparisons, risk analysis, etc.

Test Marketing Stage

•Increases certainty of successful commercialization.
•Actual sales reflect consumer acceptance.
 E-commerce and Business
Start-up
• E-commerce offers entrepreneurs an opportunity to
be creative and innovative.
• Factors that facilitate high-growth in electronic
commerce:
– Widespread use of personal computers.
– Adoption of intranets in companies.
– Acceptance of the Internet as a business
communications platform.
– Faster and more secure systems.
 E-commerce and Business
Start-up (Cont’d)
• Using E-Commerce Creatively
– Entrepreneurs have to decide whether to :
• Run Internet operations within the company.
• Outsource these operations to Internet specialists.
• Use e-commerce packages provided by software
companies.
– The integration of front-end and back-end operations
represents the greatest challenge for doing Internet
business.
 E-commerce and Business
Start-up (Cont’d)
• Web Sites
– Ease of use.
– Structure and organization of information.
– Search capability.
– E-mail response system.
– Speed.
– Compatibility with different browsers and platforms.
 E-commerce and Business
Start-up (Cont’d)
• Tracking Customer Information
– Electronic databases track the activity of the industry,
segment, and company.
– It supports personal marketing targeted at individual
clients.
– Care must be taken to follow the laws protecting the
privacy of individuals.
 E-commerce and Business
Start-up (Cont’d)
• Doing E-Commerce as an Entrepreneurial Company
– Products should be delivered economically and
conveniently.
– Products need to interest a wide market; company
must be ready to ship the product outside its own
geographical location.
– Online operations should bring significant cost
reductions.
– Company must be able to economically draw
customers to its Web site.
 Reference Book /Reading
Material

1.Hisrich, R. D., Peters, M. P., Shepherd, D. A., (2017),

Entrepreneurship. McGraw Hill Education. New York
 Any Questions?

In case of any query feel free to contact:

[email protected]
Thank you