Entrepreneurship 8 th Edition

3. Entrepreneurship 8th Edition • Author: • Robert D Hisrich, • Micheal P. Peters • Dean a Shepherd

4. Creativity & Innovation • Creativity is the ability to develop new ideas and to discover new ways of looking at problems & opportunities • Innovation is the ability to apply creative solutions to those problems & opportunities to enhance or to enrich people’s lives Innovator

5. Creativity = Ideas • Creativity involves generating something from nothing • Creative ideas springs up from the most unexpected places

6. Edwin Land, one of America’s most prolific inventors, credits his three year old daughter with the idea of the Polaroid instant camera

7. What an idea!!!! But not valued in Business until implemented!!!

8. Innovation = Ideas + Action • Entrepreneurship is the result of a disciplined, systematic process of applying creativity & innovation to needs & opportunities in the marketplace • Millions of people come up with creative ideas for new or different products & services; most of them, however, never do anything with them • Entrepreneurs are those who connect their creative ideas with the purposeful action & structure of a business • Thus successful entrepreneurship is a constant process that relies on creativity, innovation & application in the marketplace

9. 3000 new product ideas, 4 make it to development stage, 2 are actually launched & only ONE becomes a success in the market

10. Creativity should be accompanied with Innovation!! • Entrepreneurs succeed by thinking and doing new things or old things in new way • Having a great new idea is not enough; transforming the idea into a tangible product, service or business venture is the essential next step

11. Trends • Green Trend • Clean-Energy Trend • Organic-Orientation Trend

12. Trends (continued) • Social Trend • Health Trend • Web Trend

13. Sources of New Ideas (1 of 2) • Consumers. • Existing Companies • Distribution channels fd

14. Sources of New Ideas (2 of 2) • Federal government • Research and development df

15. Methods of Generating New Ideas • Focus groups • number of group members from 6-12 • Moderator focuses discussion of the group in a directive or nondirective manner. • Co. women’s slipper-concept of “warm & comfortable slipper that’s fits and old shoe” – 12 women focus group • An excellent method for initially screening ideas and concepts.

16. Brainstorming • A Group method for obtaining new ideas & solutions • 4 Rules should be followed • No criticism is allowed by anyone in the group • Freewheeling is encouraged-wilder the idea the better • Quantity of ideas is desired- greater the no. of ideas the greater the likelihood of the emergence of useful ideas • Combinations and improvements of ideas are encouraged- ideas of others can be used to produce still another new idea Brainwriting is similar to Brainstorming…

17. Focus group and brainstorming is different in the sense that FG is structured or moderated...while BS is not a debate or discussion like that....its people giving lots of ideas without criticism allowed

18. Methods of Generating New Ideas (2 of 2) • Problem inventory analysis Consumers associates particular problems with specific products & then develop a new product that do not contain the identified fault

19. Problem inventory analysis (continued) • Instead of generating new ideas themselves consumers provided with list of problems in general product category • Then asked to identify & discuss products in this category that have particular problem • Effective method since its easier to relate known products to suggested problems & arrive at a new product idea than to generate an entirely new product idea by itself • Results must be carefully evaluated as they may not actually reflect a new business opportunity.

20. Creative Problem Solving • Creativity: an important attribute of a successful entrepreneur. • Creativity tends to decline with: • Age, education, lack of use, and bureaucracy.

21. Creative Problem-Solving Techniques <<Insert Table 5.2>>

22. Creative Problem-Solving Techniques (1 of 3) • Brainstorming • Used in creative problem solving and idea generation. • Creative problem solving: amethod for obtaining new ideas • Spontaneous contribution of participants • Problem statement-neither too broad nor too narrow • Avoid inhibiting responses • NO group member should be expert in field of problem • Ideas even if illogical, must be recorded • Prohibit criticizing OR evaluating during BS session

23. Reverse brainstorming • A group method for obtaining new ideas focusing on the negative. • Finding fault by asking questions “in how many possible ways can the idea flop” • Maintain group morale • Stimulate innovative thinking • Often involves identification of everything wrong with an idea- followed by discussion how to overcome these problems

24. Brainwriting • Form of written brainstorming. • It is a silent, written generation of ideas by a group of people. • This sheet can b passed around on e-mail as well • Pass the sheet around – reach its owner • The only thing wrong with it is that there is no excitement of verbal discussion

25. Creative Problem-Solving Techniques (2 of 3) • Gordon method • Method for developing new ideas when the individuals are unaware of the problem. • u don’t give away too much detail about the problem • headline would be “i wish there was something v cud do about the bad colors in my TV screen” Or Latest trends in fashion world” • Checklist method • Developing a new idea through a list of related issues.

26. Product Planning & Development Process Establishing Evaluation Criteria • Criteria for evaluation need to be established at each stage of the product planning and development process. • Criteria should be: • All inclusive and quantitative to screen the product carefully. • Established to evaluate the new idea in terms of: • Market opportunity • Competition • Marketing system • Financial factors • Production factors.

27. Need for the product idea must exist • Characteristics & attitudes of consumers that might buy the product, size & nature of market • Share of that market that product could capture • Market opportunity • Competition • Marketing system • Financial factors • Production factors. • competing producers, prices, & marketing policies should be evaluated • Product should be able to compete successfully with products already on the market by having features that will meet or overcome current or anticipated competition • New product should be compatible with existing management capabilities & marketing strategies • Firm should be able to use its marketing experience & other expertise in this new product effort • Example: GE would have less difficult time adding a new kitchen appliance to its line than P&G • product should be able to be supported by & contribute to Co. financial structure • Break even point & Long term profit outlook for product need to be determined • if the new product idea cannot be integrated into existing manufacturing processes, not only is the new idea is less positive- but new plan & production cost – plant space need to be determined

28. Product Planning and Development Process • Divided into five major stages: • Idea stage. • Concept stage. • Product development stage. • Test marketing stage. • Commercialization.

29. The Product Planning and Development Process (1 of 3) • <<Insert Figure 5.6>>

30. The Product Planning and Development Process (2 of 3) • Idea stage • Promising new product/service ideas should be identified. • Impractical ones eliminated. • Evaluation method – systematic market evaluation checklist. • Concept stage • Refined idea is tested to determine consumer acceptance. • Consumer acceptance can be measured through the conversational interview method.

31. The Product Planning and Development Process (3 of 3) • Product development stage • Determines consumer reaction to the physical product/service. • A tool frequently used – consumer panel. • Consumer preference is determined through: • multiple brand comparisons, risk analysis, level of repeat purchases, or intensity of preference analysis. • Test marketing stage • Increases certainty of successful commercialization. • Provides actual sales results, which indicate the acceptance level of consumers. • Positive test results indicate probability of successful product launch

32. E-commerce and Business Start-up • E-commerce offers entrepreneurs an opportunity to be creative and innovative. • Factors that facilitate a 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.

33. Using E-Commerce Creatively • Entrepreneurs starting an Internet commerce venture need to address the same strategic and tactical questions as any other entrepreneur. • Entrepreneurs have to decide to: • Run Internet operations within the company, or • Outsource these operations to Internet specialists. • Another option is to use the packages for e-commerce. • Internet operations-company primary business • Availability of resources –web professional

34. Components of Internet Commerce • Two major components of Internet commerce are: • Front-end operations. • Back-end operations. • Integration of front-end and back-end operations • represents the greatest challenge for doing Internet business. • provides the opportunity for developing a sustained competitive advantage. The biggest mistake of many companies on the internet is believing that an attractive & interactive website will secure success- leads to underestimating imp of end operations

35. Web Sites- connection btw Co & its Customers Indicator of legitimacy professional design Web designer • Keys to a good Web site: • Ease of use ( info product /services ) • Structure and organization of information • Visibility • Search capability • E-mail response system • Speed. • Technical aspects • Should work properly in different browsers and platforms. • Should appear in all marketing materials. Shopping cart- credit card payments Secure servers https Advertise- search engines, banner ads, email Secure servers https

36. Tracking Customer Information • Database: • Tracks activity of the: • Industry. • Segment. • Company. • Supports personal marketing targeted at individual clients. • Should be able capture customer attention with customized one-to-one marketing.

37. Doing E-Commerce as an Entrepreneurial Company Fresh fruits & vegitables ? • To do business through the Internet: • 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 have to bring significant cost reductions-as compare to brick & mortar operation • Company must possess the ability to economically draw customers to its Web site.

38. Summary • Starting point –successful Co.- product/Service they offer • Sources of ideas ranges – comments of consumers TO changes in Govt regulations • Monitoring comments of Consumers • Evaluating new products offered by competitors • Familiar with the ideas contained in previously granted patents

39. Becoming actively involved in R&D • Specific tech’s entrepreneur use to generate ideas • After idea generation the planning and developing process begins • Large number ideas screened/ evaluated • Potential ideas moved- concept, product development, test marketing, commercialization stage Focus group-Brainstorming-Problem inventory analysis