Ideation, Innovation and Entrepreneurship PDF

 1 Ideation, Innovation and Entrepreneurship 10  Synopsis This chapter introduces students to the process of ideation, creativity and innovation in entrepreneurship. Students will be introduced to various methodologies to create solutions...

 1 Ideation, Innovation and Entrepreneurship 10  Synopsis This chapter introduces students to the process of ideation, creativity and innovation in entrepreneurship. Students will be introduced to various methodologies to create solutions to solve customers’ problems. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 3  Objectives The objectives of this chapter are: To understand the issues on ideation, creativity and innovation especially those that are related to business opportunities and entrepreneurship. To introduce thinking techniques that can enhance ideation, creativity and innovation to create new products and services, or improve existing products and services, or identify new business opportunities. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 4  Learning Outcomes At the end of this chapter, students should be able to: Gain an understanding on issues of ideation, creativity, innovation and learn to apply relevant thinking techniques to their entrepreneurial projects. Develop positive attitudes towards new ideas, creativity and innovation. Identify new business opportunities. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 5  List of Topics  Idea Generation  Ideas from Work Experience, Hobbies, Interests and the Environment  Techniques for Generating New Business Ideas  Transformation of Ideas into Business Opportunities Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 6  Introduction  An idea can be regarded as the outcome of a thinking process (i.e impression, opinion, view, belief, formulation and concept).  In entrepreneurship, ideation is the creative process of generating, developing, and communicating new ideas.  A business start-up ideation must be centred on solving customers’ problems. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 7  Idea Generation  Generating an idea may involve the whole process of observing, thinking (analyzing), communicating (discussing) and developing, which can be abstract, concrete and visual.  Ideas may come to entrepreneurs from daily exposures. – A frustrating experience or a source of irritation could be a great business idea for an entrepreneur. – Customers’ complaints and feedback can provide an opportunity to develop something better, quicker or cheaper than existing products. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 8  Ideas from Work Experience, Hobbies, Interests and the Environment  Work experience is one of the primary sources of a business idea (Strydon, 2007).  An entrepreneur can use his work experience and technical skills obtained from earlier work to resolve problems and shortcomings in his present work or operation system. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 9  Ideas from Work Experience, Hobbies, Interests and the Environment (cont.)  A new business idea may grow from a hobby or personal interest. – For example, someone who loves to bake cakes may start selling their cakes online as a way to generate income. – This business may grow as demand increases. The home baker will need to decide at one point whether to become an entrepreneur managing a growing business, or he may return to baking just as a hobby. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 10  Ideas from Work Experience, Hobbies, Interests and the Environment (cont.)  New ideas, information, opportunities or insight into new technological trends may reach entrepreneurs through trade exhibitions, or links with universities and research institutes, or networking with sales representatives, wholesalers, distributors, manufacturers, franchisers, professors and research scientists.  It is also important to observe and pay attention to latest trends and technological development in technical magazines, scholarly journals, newspapers and the Internet. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 11  Ideas from Work Experience, Hobbies, Interests and the Environment (cont.)  A clever entrepreneur will likely systematically scan his environment to identify business ideas or to get an idea on the problems faced by the people and explore possibilities of offering products or services that may solve such problems.  Biallas (2014) shows the matrix of business idea (existing and new) versus market (existing and new market) in Figure 10.1. There are four quadrants that may be analyzed to identify new ideas. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 12  Ideas from Work Experience, Hobbies, Interests and the Environment (cont.) Examle of: 1. Existing business idea / Existing Market 2. New business Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 13  Ideas from Work Experience, Hobbies, Interests and the Environment (cont.) Discuss possible example of: 1.Q1Existing business idea / Existing market: Offering existing product and /or service to existing market. 2.Q2Existing business idea / New market: Offering existing product or service to new market. 3.Q3New business idea / Existing market: Offering new product and / or service to existing market. 4.Q4New business idea / New market: Offering new product and / or service to new market. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 14  Techniques for Generating new Business Ideas There are many ways to help entrepreneurs 1 generate a new business idea. 2 3 Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 15  1. Brainstorming  Brainstorming is one of the most commonly used techniques in generating a new business idea. – The aim is to come up with as many ideas as possible in a short period of time. – Usually questioning or criticism is not allowed. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 16  1. Brainstorming  People do not need to fear making mistakes or looking foolish in front of other team members. – In fact, it is highly encouraged to put forward ideas which might not seem to work. – There are no “bad” ideas, as all ideas could be the start for another idea. – It is also good to have a multidisciplinary team so that a problem can be approached from different perspectives. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 17  2. Focus Group  A focus group is typically composed of eight to 14 individuals participating in a discussion to generate a new business idea in a structured way.  The focus group members are usually selected because of their relationship with the issue being discussed.  A trained moderator leads the group through an open and in­-depth discussion, in either a directive or non­directive manner. The success of the session is highly dependent on the moderator’s ability to ask questions that keep the discussion on track. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 18  3. Surveys  A survey is a technique of collecting valuable information from a sample of people; usually just a fraction of the population being studied.  Demand, supply and change in customer behaviour can be analyzed and ascertained through a survey. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 19  3. Surveys  The survey can be carried out formally or informally via various methods: i. interviews, ii. questionnaires or iii. observations.  The survey usually asks specific questions and gets specific answers, which helps entrepreneurs to generate new business ideas. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 20  Transformation of Ideas into Business Opportunities In order to get an idea on the business potential of the new ideas, entrepreneurs may ask the following:  Has it solved the customers’ problem or pain?  Does it offer higher value ­added products or services?  Does it have a unique selling proposition?  Can it be produced at an acceptable cost, and marketed and sold at a profit?  Does it have competitive advantage compared to competitors’ products? Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 21  Business Opportunities through Buying of Existing Business  Business opportunities can also be in the form of existing business being offered for sale at attractive price with good business potential.  However, a detailed due diligent evaluation must be done on the business for sale to make sure that the offer price is competitive and the business potential is attractive. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 22  Summary  Entrepreneurs should always remember that a start-up is not necessarily limited to providing a completely new product or service. – They may also introduce value addition to the existing product or service. – The entrepreneur should always be alert to customers’ complaints and frustrations that can form the basis of developing new product or service. . Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 23  Summary (cont.)  An entrepreneur could also explore plenty of new business ideas from their work experience, hobbies or personal interests, combination of two or more ideas, serendipity and others  Finally, techniques such as brainstorming, focus groups and surveys can be used to generate new business ideas too.  Buying existing business can be an alternative to overcome slow start-up process if the business potential is good and the price is a bargain. Introduction to Entrepreneurship All Rights Reserved © Oxford Fajar Sdn. Bhd. (008974-T), 2017 10– 24