Entrepreneurial opportunities

Entrepreneurial opportunities can be explained that in which new products, materials that are raw
and methods to organize are initiated and sell at a price more than the production cost. It is basically
explained as to sell a product at price that is greater than to production cost. In others words it is to
have more profit.

Where Opportunity can be described as situation where a person could exploit a creative unique
new idea that can generate profit. In simple words the basic idea is to have uniqueness, newness
and economical potential to your product.

Since Opportunity is a broad topic and due to which it is divided into two different theories related
to the nature of Entrepreneurial opportunities:

1. Discovery view of Opportunities

2. Creation views of Opportunities

Opportunity creation

This type of opportunities is described as the opportunities in which none of the demand and supply
party exists and there is a need to create one. Due to which several economic inventions need to
take place in market or franchise etc to create opportunity. This perception of opportunity deals
with the creation of the new markets. In other words, it is a process of creating new entrepreneurial
opportunities for oneself in the market. The basic idea of this is to develop business that is based to
creative new process. It has a difference from the previous boundaries that has been set by
organization or environment.

Example:
Since we know that America is the country of inventions where people try to create opportunities
for them rather than discovery of opportunities. There are so many examples of opportunity
creation as mentioned below.

 Colonel Harland Sanders founded the KFC who was an entrepreneur who began to sell fried
chicken from small restaurant and then becomes the World Best Fried Chicken Franchise.
 Elon Musk is American entrepreneur who founded X.com in 1999 which later
became PayPal, SpaceX in 2002, Tesla Motors in 2003 and hyperloop in 2008.

Opportunity discovery 

This type of opportunity describes as the systematic innovation process that generate new ideas and
then combining them to form opportunities. Opportunity discovery basically helps organization to
change their current business portfolio into a new level of technology and market space. This is
basically assumed that sometimes, somethings wait to be discovered. In discovery theory it is
considered that competitive imperfections can happen to arise exogenously which changes in
technology and some more attributes of the context within which a market exists. This kind of
opportunity revolves around the concept that only one market variable is known that can be of
supply or demand for the services or product.

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 Example:
Since we know that there are people that discover opportunities for them rather than creating
opportunities. There are so many examples of opportunity discovery as mentioned below.

 Elon Musk discovers the real potential of the internet and used it as the best and easy way
to do online payments.
 Bill Gates discovers the real capability of operating system and started Microsoft.
 Jeff Bezos identified the true potential of internet and technology by creating online digital
bookstore.

Both the opportunities (Discovery and Creation) are explained below.

Comparison between Discovery and Creation:

In discovery theory, it is considered that competitive imperfections can happen to make an

appearance exogenously which changes in technology and some attributes of the condition within
which a market exists. Market is usually forming opportunities and this emphasis on exogenous
shocks creating opportunities. In this theory the opportunities basically exist earlier instead of
creating new. Also, individuals difference leads to opportunities and to
which entrepreneurs frequently collect and utilize available or new resources in order to achieve the
best effective method or results. In this type of theory, it needs that proper information and
knowledge should be known ex ante. Discovery theory is based on realist suppositions of
opportunities like the mountains exists in real and object phenomena, unconventional of the
actions of the entrepreneurs that are waiting to be discovered.

Where In creation theory, it is considered that opportunities are not to assumed to be objective
phenomena of that is being created by exogenous shocks to market or business. Instead of that it is
created by actions and working of entrepreneurs that explores the new to create or design new
products or services. This theory is different in nature because it does not revolve around pre-
existing market or business markets. In creation, entrepreneurs do not just search for mountains to
climb, instead of searching, they act and then they observe that how market and consumer respond
to their way of actions. In this theory “seeds” of opportunities are sow in soil to create new products
or services in market that were not previously existed. In these opportunities are put into an idea or
suggestions.

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.

Based on following categories there are some comparisons between discovery and creation.

Discovery Creation
Leadership • Based on competence • Relay on Charisma or
and perhaps personality
observations. • “Charismatic”
• “Expert” leadership leadership.

Name of Opportunities • In this Opportunities • In this it not possible

can exist that Opportunities
unconventional of dependent of
tycoon and applying Businessman and
the philosophy realist applying the realistic
knowledge and evolutionary
• Discovery philosophy.
opportunities are the • Creation opportunities
opportunities exist are not possible by the
apart from actors. entrepreneurs.

Name of Entrepreneurs: • It is different in very • It can be or cannot be

crucial ways from differ from non-
common men and ex tycoons and ex ante.
ante. • Difference of opinions
emerge. After the fact.

Nature of Decision-Making • High risk and • Unknown

Context: dangerous

Decision Making: • Decisions based on • Repetition,

risk evaluations. preparatory and
• Dangerous and High making decision is
risk for the data gradual.
collection tool • Usage of bias
• High Risk decision- • Significance of modest
based tools created. loss.
• Cost Opportunity
significance

Strategy • Relatively com plete • Emergent and

and unchanging. changing.
• In discovery • In creation
opportunities the rule opportunities the rule
that basically applied that basically applied
is to Know and then is to Act and then
act. know.

Finances: • Outside the capital • Building a company

banks and business from the ground with

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Marketing:
Sustaining competitive
advantage
Human resource practices:
Process:
Uncertainty of the business
environment:
Role of the Actor
(Entrepreneur):
End results:
Core Arguments:
firm. nothing and just with
personal savings with
the help of colleagues
and families.
• In this the • In this Marketing
development in retail basically change
mixed or somehow because of the new
new. opportunities that
• The opportunities are emergences.
manifesting
themselves.
• The basic blocks like • Basic learning tacit in
Speed and erecting trackway which
barriers to entry depending on
benefits organization procedure that may
support the benefit.
• Advertise and recruit • Advertise and recruit
of task-based humans. of workable induvial.
• Making solutions for • Design on reality
problems based.
• Best options- • Creation along the
Discovering track
• Making Decision • Making Sense
• The Last is untold and • Both the initial and the
mysterious yet end situation are
beginning condition is unknown.
known.
• Beginning Condition is
undisclosed, yet the
ending is known.
• Notified person who • Competitor and the
builds improving builder.
things.
• Present design and • Future oriented
orientate. • Realities are new.
• Creative Options and • No perfect solution.
solutions for problems
that exists.
• Solutions existing for
new applications
• Opportunities are • Opportunities are
objective phenomena. enacted or created by
entrepreneurs.
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 Objectivity of Opportunity: • Opportunity exists • Opportunity does not
objectively but exist independent of
unknown to all. entrepreneur.

Entrepreneur Roles: • Discovery & • Endogenous creations.

exploitation.

Dynamics of opportunity: • Exogenous • Entrepreneur

event/situation controlled process

Profits • Potential Profit • Potential Profit

Exploitation:
Opportunity exploitation is crucial piece of the entrepreneurial process which basically means in
literature is to involve opportunity extension, resource mobilisation and to have legitimacy. In this
when extending an opportunity, it gets influenced by the nature of the opportunity expected return
and costs etc. Exploitation has different forms which includes knowledge of customer demand,
decision to exploit opportunities, developing of enabling technologies and new entry etc.

Where Entrepreneurial strategy means that the way an organization uses to established or re-
establish set of rules with its environment to achieve desired fundamentals set of relationships.
Basically, there are some strategies that can be used in effective exploitation of opportunities.

Following are the firm-level capabilities that can be used in effective exploitation of opportunities:

Market knowledge:
Market Knowledge is what information do you have related to the that specific area. Every
information related to this area like skills etc. It is basically providing insight into market and its
customers.

 Example:

Tesla tries to enter in Pakistan’s market and although they have already their product, yet they need
to have a proper market information that how things work in Pakistan.

Technological Knowledge:
It is basically to have an insight into ways to innovate processes and technology. Technological
Knowledge is something when you launched a product in market, that product is getting popular and
then another company arrive, and it learns how your product work and they improved it and
launched improved version of product and gain more profit than your company because of getting
technological knowledge.

• Example:

Nokia started the mobile production, but they are now failed because of no proper technological
knowledge where other mobile companies takes the Nokia product and did some improvements &
innovation and now, they are getting profit like Motorola, Window or Google.

Information on a new Entry:

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It is basically to provide insight to prior knowledge and information search. It includes to search out
for window of opportunity. More knowledge ensures a more efficient search process (lower search
costs). It consists of Search costs include time, money and psychological cost.

• Example:

Window of opportunity means that During COVID-19 Situation, Companies realize the window of
opportunity and they started to manufacture the “Masks”.

Strategies linked to help firms to exploit opportunities is explained below:

Since to succeed in the race of entrepreneurship, Strategies needs to be focused and Linked to each
other somehow. Facebook would be the best example to explain how all the above strategies are
interlinked with each. Founder of Facebook in his young age realized that there is window of
opportunity for a new social media platform, although there was already a social media platform
known as oracle, yet they were not improving day by day. So, Founder of Facebook launched a
product known as Face match and He realized that it needs improvement by using the concept of
technological knowledge. Although oracle was on top, yet Face match later become Facebook is now
on top where Oracle is no more. Reason is that Facebook applied both the information on a new
entry strategy, technological knowledge to improve and add innovation in their product and used
market knowledge to advertise Facebook to all the world.

Entrepreneurial Orientation:
Entrepreneurial Orientation means to reflect a managerial vision and to produce innovations that
creates value for the business and customers in an organization. Entrepreneurial Orientation is the
central component of entrepreneurship.

Five Dimensions of Entrepreneurial Orientation:

Following are the five dimensions of entrepreneurial orientation:

 Autonomy:
Autonomy is having the decisional freedom to induce an entrepreneurial idea by an individual or a
team of individuals within an organization. In any organization, people are offered to generate new
ideas and individuals are unhindered by the norms and traditions so they can bring new ideas into
shape effectively.

 Innovation:
Innovation is defined as the creation, production and implementation of new creative ideas. The aim
of innovation is to improve efficiency or effectiveness. The performance of an organization depends
on the successful innovation ideas i.e., developing new ideas, processes and services.

 Risk Taking:

The actions or facts that include danger or risk in order to achieve a goal is known as risk taking.
When a business is being started, it involves risk taking. Risk taking is very essential
entrepreneurship in order to learn skills or experience the failures to learn from them. However, the
actions taken by the entrepreneurs are through proper planning and strategies.

 Proactiveness:

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Proactiveness is the anticipation and act on future needs. Proactiveness means to adopt an
opportunity seeking perspective. The organizations that are proactive create different ideas and act
on them in advance and in this way these organizations shift the market demand.

 Competitive Aggressiveness:
Competitive aggressiveness in entrepreneurship means having an intense behaviour and directly
challenging the rivals rather than avoiding the competition. It also means to have the emotions of
competing, winning and crushing the rivals.

 Reflection on Risk Taking:

Taking a risk is very important for every aspect of life. It is essential to take a risk to achieve your
goals. If risk is not taken, one would not experience the taste of failure. Risk taking requires courage
to face the uncertainty. Even if the results are not what was expected, it brings growth in process,
and becoming more confident and experienced. Risk taking increases the chance of achieving the
goals.

Example:

In a classroom, teacher is asking a question from its student. One of the students raises the hand
even he does not know that the answer in his mind is correct or not, but he still takes the risk and
raises his hand. He describes his answer to teacher, and it is correct. If he had not taken the risk, he
will never be so confident, and the fear of failure always reside in his mind.

Reflection on Proactiveness:

Proactiveness is very important as it helps to be relaxed and prepared and taking precautionary
steps for potential situations. It shows one’s ability to think with a create mindset and take an
initiative.

Example:

A student is being proactive as he tidies up the work in the morning. Makes his to do list, prioritize
his tasks. First, he does the hard tasks that require much time and then the easy ones. In this way, he
manages his time properly and do all the tasks and maintains the right altitude.

Reflection on Innovation:

In business, innovation means to create new, different and unique ideas and then bring that ideas
into practical shape. Innovation can be a product, business concept or a process that is activated in
the marketplace to gain profit.

Example:

In an engineering college, the group of students thinks a unique idea for their Final Year Project.
They think of an energy producing roads. The roads are supposed to work as a solar panel, and they
also produce electricity for streetlights and household purposes. This is innovation as the students
create ideas.