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The starting point of a business is a viable business idea. A business idea is a concept which can be
converted into a tangible product or service or enterprise for commercial purposes. An entrepreneur
should have the ability to generate viable business ideas.
Several other techniques are available for idea generation, such as visualization, which involves
think of problems visually in order to better understand the issue. The incubation & illumination
process, where you take a break from a problem you are stuck on, focusing on something
completely different while your mind continues to work on the idea subconsciously. This develops
into a period of illumination where you suddenly get a variety of solutions and you quickly write
them down, developing new parallel lines of thought.
Question your assumptions and knowledge and beliefs
OPPORTUNITIES
Contrary to what many aspiring entrepreneurs believe, the key to a successful startup does not rest
entirely upon having a unique, one-of-a-kind idea. What is important is the ability to execute the
idea and turn it into a profitable business. That's why so many startups fail year after year.
Not all business ideas represent authentic business opportunities.
Opportunities are ideas that will result in a successful business. An opportunity is a favourable set
of circumstances that create the need for a new product, service or business
while an idea is a thought, notion or concept which may or may not meet the criteria of an
opportunity. It consists of four integrated elements that should be considered and are a need, the
means to fulfil it, a method to be applied to the means to fulfil the need and a method to benefit
from it.
A Business Opportunity requires both an attraction and the possibility of being sustainable. It
corresponds to a need and it reaches the market in a promising moment. It also covers a product or
service, and therefore represents an additional value for the consumer. The discovery of a business
opportunity usually arises from one or several substantial ideas that can fit into the market reality.
Opportunity Recognition
In order to create a successful, profitable, venture, it is necessary to recognise a real business
opportunity. This is something that most new businesspeople do not pay enough attention to. It is a
statistical fact that most businesses fail within the first two years of existence due to the fact that
they are built on an idea rather than on an opportunity. The ability to quickly distinguish between a
business ideas and a business opportunity is the main difference between successful and
unsuccessful business people.
Most successful entrepreneurs are opportunity focused and have the ability to recognise
opportunities. In a free enterprise system, changing circumstances, chaos, confusions,
inconsistencies, lags or leads, knowledge and information gaps and a variety of other vacuums in
an industry or market spawn opportunities
Most trends stem from changes in the Environment which could be economic, social, technological
and legal political. The ability to anticipate changes are so critical in entrepreneurship that constant
vigilance for changes is a valuable habit. An entrepreneur with credibility, creativity and
decisiveness can seize an opportunity while others are still studying it
Economic forces affect consumers’ level of disposable income whereas Individual sectors of the
economy have a direct impact on consumer buying patterns.
Get a handle on these forces by:
(i) Studying and observing and
(ii) Purchasing market forecasts/analyses
Examples- emergence of a new economic activity creates demand for new products, services,
technology etc
Change in the economic status of the population gives rise to opportunities for new products and
services
A drop in interest rates typically leads to an increase in new home construction and furniture sales
Social Changes
An understanding of the impact of social forces on trends and how they affect new product,
service, and business ideas is a fundamental piece of the opportunity recognition puzzle.
The persistent proliferation of fast‐food restaurants isn’t due primarily to people s love for fast food
but rather to the fact that people are busy: the number of households with both parents working
remains high of the recent
Social trends that allow for new opportunities are the following:
• Family and work patterns (for example, the number of single parents with two jobs or the number
of double-income households with flexible hours),
Health issues (for example, people living longer with more active lives)
• The aging of the population
• The increasing diversity of the workforce
• The creation of cell phone is a technological achievement, but was motivated by an increasingly
mobile population
The globalization of industry
• The increasing focus on health care and fitness
Technological Changes
Technology changes continue to alter the way we conceive opportunities e.g the internet has
created more diverse opportunities in sales and distribution notably ebay, amazon etc, deregulation
of the telecommunication industry lead to the formation of many new firms. Given the rapid pace
of technological change, it is vital for entrepreneurs to remain on top of how new technologies
affect current and future opportunities. Once a technology is created, products emerge to advance
it. E.g. RealNetworks created to add video capabilities to the Internet
Advances in technology frequently dovetail with economic and social changes to create
opportunities.
• The proliferation of computers and the Internet
• The continual increase in the number of cell phone users
These Factors generate opportunities for producing new products that can have an effect on the
way people live their lives at any given moment. The goal is to create products and services by
identifying an emerging trend and to match that trend with the right technology and understanding
of the purchasing dynamics. The window of opportunity is often small—a product that comes out
either too early or too late can fail even if the opportunity existed initially.
Successful new products become necessary once they hit the market. Most customers are not even
aware they need the product because they are immersed in the trend. If the company hits the trend
at the point it is just catching on, the product will become instantly desirable. The length of a trend,
combined with the product‘s attributes of use and usability, determines the lifetime of the product.
2. Solving a Problem
Sometimes identifying opportunities simply involves noticing a problem and finding a way to solve
it. These problems can be pinpointed through
• More simple means (intuition, serendipity, or chance) Some business ideas are clearly gleaned
from the recognition of problems in emerging trends…
… or less deliberate: • individuals may set out to solve a practical problem and realize that the
solution may have broader appeal
• Someone may simply notice a problem that others are having and think that the solution might
represent an opportunity.
• When computers were invaded by hundreds of foreign virus strains and corporate infection was
becoming a serious problem, Symantec’s Norton Group launched Norton anti-virus
• The increase in the price of petroleum and the call for environmental consciousness caused many
automakers to release hybrids in the 2000s.
There are also gaps in the marketplace that represent consumer needs that are not being met at all
by anyone. E.g. People wanted to listen to music on the go. The launch of the Sony Walkman was
rather a breakthrough in imagination than in technology. For the first time headphones allowed all
people to be at two places at once: People could easily listen to music while on the road.