ENT300 Chapter 4: Business Opportunities PDF

CHAPTER 4: BUSINESS OPPORTUNITIES  LEARNING OUTCOMES 1. Determine the opportunity analysis process 2. Analyse business based on SWOT analyses and Business Model Canvas  INTRODUCTIO N  An “opportunity” is defined as a situation that enables...

CHAPTER 4: BUSINESS OPPORTUNITIES  LEARNING OUTCOMES 1. Determine the opportunity analysis process 2. Analyse business based on SWOT analyses and Business Model Canvas  INTRODUCTIO N  An “opportunity” is defined as a situation that enables an entrepreneur to offer products or services to interested or potential buyers or end users.  Opportunities exist to inspire individuals to become entrepreneurs and act as a link between individuals and setting up of new ventures (Venkataraman, 2004).  With lucrative opportunities, individuals and firms can innovate, evolve, expand, or improve the provision of any products or services they may provide.  What Is Opportunity? Market need for the Circumstances Timing of entry of products or surrounding the the venture into the services must be opportunity market must be defined must be precise favourable Opportunity Development Process Stage 1 : Identifying Opportunity Stage 2: Evaluating Opportunity Stage 3: Selecting Opportunity  BUSINESS TOOLS SWOT ANALYSIS BUSINESS MODEL CANVAS SWOT ANALYSIS  SWOT ANALYSIS- WHAT?  One of the most effective business and decision-making tools.  An analysis of firm by looking at its internal environment as well as its external environment.  Internal env – those which can be controllable inside a firm which influences how well firm operates.  External env – elements outside of firm that may affect positively/ negatively such as legal factors, economic factors, technological factors, demographic factors, etc.  Focusses on strengths (S), weaknesses (W), opportunities (O) and threats (T).  SWOT ANALYSIS-  To allows firm to WHY? develop strategies which will maximize strengths and capitalize on opportunities.  To helps assess internal factors (strengths and external factors (opportunities and threats) weaknesses) business. and that might  affect ayour To increase awareness of the factors that go into making business decision or establishing a business strategy.  To understand your competitive advantages & disadvantages, finding things to improve about your firm and understand why some aspects of your firm are struggling.  To guides you to build on what you do well, address what you're lacking, seize new openings, and minimize risks. SWOT ANALYSIS – HOW?? 1. List your strengths.... 2. List your weaknesses.... 3. Identify your opportunities.... 4. Identify your potential threats.... SWOT ANALYSIS BUSINESS MODEL CANVAS (BMC)  The Business Model Canvas (BMC) gives you the structure of a business plan. 1. Customer Segment 2. Value Propositions  What differentiates the firm’s product or services from their competitors.  Uniqueness of the product or services is the competitive advantage to the firm.  The value proposition of a product or service can be in terms of price, design, feature, functions, status, reliability, personalisation, and convenience. 3. Channels a) Distribution Channels  Direct Channel  Indirect Channel b) Marketing Channels  Social Media  Public relations  Advertising  Sales promotion 4. Customer Relationships Personal Assistanc e Dedicated Co-creation Personal Assistanc e Communities Self- Service Automated Services 5. Revenue Streams Licensing Subscription Brokerage Fee Fees Lending/ Leasing/ Advertising Renting Asset Usage Fee Sale 6. Key Resources 7. Key Activities List down all the important activities that are relevant to the business. Parallel with revenue streams so that an evaluation may be done on the impact of the revenue. 8. Key Stretegic Alliance Partnership Coopetition Joint Venture Buyer-Supplier 9. Cost Structure  Cost incur for business operation.  Focusing on value-driven (providing maximum value) or cost-driven (minimising investment).  Fixed cost and variable cost. BMC AIR ASIA The Canvas has nine elements:  Customer Segments: Who are the customers? What do they think? See? Feel? Do?  ValuePropositions: What’s compelling about the proposition? Why do customers buy, use?  Channels: How are these propositions promoted, sold and delivered? Why? Is it working?  CustomerRelationships: How do you interact with the customer through their ‘journey’?  Revenue Streams: How does the business earn revenue from the value propositions?  KeyActivities: What uniquely strategic things does the business do to deliver its proposition?  Key Resources: What unique strategic assets must the business have to compete?  Key Partnerships: What can the company not do so it can focus on its Key Activities?  Cost Structure: What are the business’ major cost drivers? How are they linked to revenue? SUMMARY  The development of opportunity begins with the identification of opportunity.  SWOT Analysis comprises both the internal and external environments of a firm.  BMC explains how a firm produces, supplies, and captures value. Through BMC, an entrepreneur plans for future business opportunities.