powerpoint chapter3(week3)

7/28/2019 Powerpoint Chapter3(Week3)

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Business start-up: Creativity and the Business Idea


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Identify various sources of ideas for new ventures. Discuss methods available for generating new venture

ideas.

Discuss creativity and the techniques for creative problemsolving. Discuss the creative climate conducive to creative process Identify and make use of the different types of innovation


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Consumers

Potential entrepreneurs to pay attention to potential

customers Informal monitoring potential ideas and needs Formally arranging for consumers to have an

opportunity to express their opinions Need to ensure that the idea and need represent a large

enough market to support a new venture: critical mass


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Existing companies

Potential entrepreneurs to establish a formal method

for monitoring and evaluating competitive products on

the market Frequently this analysis uncovers ways to improve on

these offerings, resulting in a new product that has

more market appeal.


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Distribution channels

Members of distribution channels good sources for new

ideas, due to their familiarity with the market: market

knowledge. In addition to their frequent suggestions of completely

new products, they will also help to market the newly

developed products.


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Federal government

Files of the patent office: the patents themselves may not be copied butcan suggest ideas for other more marketable products

Some governments eg USA publishes list of abstracts of thousands ofgovernment-owned patents.

Sources:

(a)Publication called Government-owned patents available for license.(b) Office of Technical services assists entrepreneurs in obtaining specific

product information(c) The official Gazette, published weekly by the US Patent Office

New product ideas can come in response to government

regulations.

Occupational Safety regulations aimed at elimination unsafeworking conditions in industry can promote an entrepreneurinto coming up with a new product as solution.


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Research and Development

Largest source of new ideas is the entrepreneurs

own R&D

Can be associated with ones current employment Can be a hobby in the informal lab in the garage

(eg Apple).


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Focus groups A moderator leads a group of people through an open,

in-depth discussion rather than simply askingquestions to solicit participant response for a new

product idea. The moderator focuses the discussion of the groupeither in a directive or non-directive manner.

The group of 8-12 participants is stimulated bycomments from other group members in creatively

conceptualizing and developing a new product idea tomeet market needs.

In addition, the focus group can help screen ideas


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Brainstorming The brainstorming method for generating new ideas is based on the fact that people can be

stimulated to greater creativity by meeting with others and participating in group discussions. Most of the ideas generated by group can have no basis for further development, however

often one good idea may emerge. There is greater probability of success when the brainstorming effort focuses on a specific

product or market area. Used in problem-solvingand idea generation Unstructured process for generating all possible ideas to solve a problem, within short timeframe Start with a statement of the problem Statement must be well defined:

(i) if too broad: diversify ideas too greatly, no good idea emerges(ii) if too narrow: tend to limit and confine responses: no good ideas

Select 6-12 people so that a wide range of knowledge is represented No group member to be a recognized expert, on the problem field to avoid inhibition Record all responses, no matter how illogical Again no criticisms / evaluations allowed No criticisms is allowed: no negative comments The wilder the idea, the better A large quantity of ideas to allow for greater likely of one good idea to emerge Combinations and improvements on ideas, piggy-riding is encouraged: ideas of others can

be used to produce other ideas.


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Reverse Brainstorming

Similar to brainstorming, but criticism is allowed

Find fault by asking the question; In how manyways can this idea fail? Care must be used to maintain groups morale This method must involve identifying everything

possibly wrong about the idea, followed by ways tosolve these problems.


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Problem-Inventory Analysis Method uses people in a manner analogous to focus group. But

instead of generating new ideas as in focus groups, consumersare provided with a list of problems in a general productcategory.

People are asked to identify and discuss product s in this

category that have the particular problem. Method is effective, since it is easier to relate known products to

suggested problems and arrive at a new product idea than togenerate an entirely new product idea by itself.

Results from product inventory analysis must be properlyevaluated, as they may not actually reflect a new business

opportunity. To ensure results, problem inventory analysis should be used

primarily to identify product ideas for further evaluation.


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Creativity is an important attribute for

entrepreneurs Creativity may decline with age, lack of use and

education Latent creativity in person stifled by perceptual,

cultural, emotional and organizational factors Ways to unlock creativity includes


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Begins with group members not knowing the exact

nature of the problem To avoid the solution being biased by preconceived

ideas Entrepreneur starts by mentioning a general conceptassociated with a problem

The group is to respond with a number of ideas Then a concept is developed, followed by related

concepts through guidance by entrepreneur The actual problem is than revealed, and group is to

make suggestions for implementation of the solution


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Helpful in developing entirely new ideas to a

problem First write a word/phrase related to problem Then another, and another, and so on, with each

new word attempting to add something new to the

ongoing thought process

Create a chain process until a new product ideaemerges


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Each member of group keeps a notebook that

readily fits in pocket, note always with person A statement of the problem is written in it Whenever an idea comes to mind, the idea is noted

down: try to at least write 3 ideas per day. This is carried out for a month At months end, notebook is submitted to

coordinator who summarises all the materials The summary becomes topics for focus group

discussion


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A trustful management that does not over-control staff Open channels of communication among all buiness

members Considerable contact with outsiders A large variety of personality types A willingness to accept change An enjoyment in experimenting with new ideas Little fear of negative consequences for making mistakes The selection and promotion of employees based on merit Use of techniques that encourage ideas, including

suggestion systems Sufficient financial, managerial, human, and time

resources for accomplishing goals


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Invention Creation of a totally new product, service or

process One the is novel and untried These are mostly revolutionary Examples:

(i)Wright Brothers: Airplane(ii)Thomas Edison: Light blb(iii)Alexander Gaham Bell: Telephone


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Extension Extension of a product, service or process already

in existyence Make a diiferent application of a current idea Baby diapers modified for use by adults Examples:

Ray Kroc: McDonalds

Mark Zuckerberg: Facebook Barry Sternlicht: Starwood Hotels & Resorts


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Duplication Replication of an already existing product, service

or process Duplication process not simply copying but adding

the entrepreneurs own creative touch to enhanceor improve the concept and beat the competition

Examples:(i) Wal-Mart: Departmental stores(ii) Gateway: Personal computers(iii)Pizza Hut: Pizza parlor


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Synthesis Combination of existing concepts and factors into

new formulation Involves taking a number of ideas or items already

invented and finding a way that they can form a

new application Examples:

(i) Fred Smith; FedEx Howard Schultz: Starbucks


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Be action oriented Make the product, service, process simple and

understandable Make the product, service and process customer-

based Start small Aim high Try/test/revise Learn from failures Follow a milestone schedule Reward heroic activity


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Innovation is planned and predictable Technical specifications must be thoroughly

prepared Innovation relies on dreams and blue-sky ideas Big projects will develop better innovations than

small ones Technology is the driving force of innovation

success


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