COURSE DESCRIPTION:

The course is designed to train mindset of

students by developing their attitude to

ENT101- become motivated as entrepreneurs.

Students will be immersed in situations
that could change their lives and inspire
them to address these changes using their

ENTREPRENEURIAL skills to carefully evaluate opportunities,

productively resolve complications,
effectively communicate with people and
efficiently work as an individual and in

MIND teams as how it affects the organization.

Course Outcomes: At the end of this

MIDTERM LECTURE
By: Prof. Ma. Luisa N. Agudo
course, the students should be able to:
1. Understand the basic principle of
Entrepreneurship
2. Identify and assess business
opportunity for entrepreneurial
venture
3. Construct and present a
comprehensive business plan in
preparation for entrepreneurial
career.
ENT101-ENTREPRENEURIAL MIND
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We make no guaranties, guaranties or representations concerning the accuracy or suitability of the

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Midterm Module Content

PART 2. INITIATING ENTREPRENEURIAL VENTURES
 Week 7. Innovation: The Creative Pursuit of Ideas
 Week 8. Assessment of Entrepreneurial Opportunities
 Week 9. Pathways to Entrepreneurial Ventures
 Week 10. Sources of Capital for Entrepreneurs

WEEK 7
TOPIC 1. INNOVATION: THE CREATIVE PURSUIT OF IDEAS

At the end of this module/topic, the students should be able to:

1. Explore the opportunity identification process

2. Define and illustrate the sources of innovative ideas for entrepreneurs
3. To examine the role of creativity and to review the major components of the creative
process.

OPPORTUNITY IDENTIFICATION: THE SEARCH FOR NEW IDEAS

Opportunity – is defined as a situation that enables an entrepreneur to offer marketable

products or service to interested buyers or end users.

• Opportunity identification is central to entrepreneurship and involves:

 The creative pursuit of ideas
 The innovation process

© 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for
use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website
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ENT101-ENTREPRENEURIAL MIND
• The first step for any entrepreneur is the identification of a “good idea.”
 The search for good ideas is never easy.
 Opportunity recognition can lead to both personal and societal wealth.

Opportunity Identification is a PROCESS that involved the search for and discovery of business
opportunities. It is central to the domain of entrepreneurship which revolves around the question
why, when and how opportunities for the creation of goods and services in the future arise in an
economy.

Approaches to Opportunity Identification

1. Observe changes in the environment

• Changes in the environment give rise to needs and wants and/or problems and an
opportunity emerges

Important environment forces to observe includes:

1. Political Forces - these factors determine the extent to which a government may influence
the economy or a certain industry. For example, a government may impose a new tax or
duty due to which entire revenue generating structures of organizations might
change. Political factors include tax policies, Fiscal policy, trade tariffs, etc. that a
government may levy around the fiscal year and it may affect the business environment
(economic environment) to a great extent.
2. Social Forces - These factors scrutinize the social environment of the market, and gauge
determinants like cultural trends, demographics, population analytics, etc. An example of
this can be buying trends for Western countries like the US where there is high demand
during the Holiday season.
3. Economic Forces - These factors are determinants of an economy’s performance that
directly impacts a company and have resonating long term effects. For example, a rise in the
inflation rate of any economy would affect the way companies price their products and
services. Adding to that, it would affect the purchasing power of a consumer and change
demand/supply models for that economy. Economic factors include inflation rate, interest
rates, foreign exchange rates, economic growth patterns, etc. It also accounts for the FDI

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use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website
for classroom use.
ENT101-ENTREPRENEURIAL MIND
(foreign direct investment) depending on certain specific industries who’re undergoing this
analysis.
4. Technological Advances. These factors pertain to innovations in technology that may affect
the operations of the industry and the market favorably or unfavorably. This refers to
automation, research and development, and the amount of technological awareness that a
market possesses.
5. Legal Forces. These factors have both external and internal sides. There are certain laws
that affect the business environment in a certain country while there are certain policies
that companies maintain for themselves. Legal analysis takes into account both of these
angles and then charts out the strategies in light of these legislations. For example,
consumer laws, safety standards, labor laws, etc.

2. Recognize a need that customers have that is not being satisfied

Opportunity occurs whenever there is a need and want to fulfill. The term “needs” refer to
the basic needs that the consumer must have in order to live while term “wants” refers to a
personal desire for something that is more than a basic need.

3. Recognize problems and find ways to solve

Problems can be recognized by observing the challenges that people encounter in their daily
lives.

Identifying Business Opportunities in the Environment

Entrepreneurs usually start from scratch. The term start-up means creating a new business
from scratch or from zero. Start-ups could be a business that provides customers with products that
do not exist or a business that provides customers with improvements on existing products (product
presentation and packaging).

Sources of Product Ideas

1. Chance happening – an unpredictable event or accidental happening that to a creation of

business idea e.g. while strolling in a park, you saw an old couple who, after a long walk
were looking for a vacant bench to sit down on. Unfortunately, all benches were occupied.
Thus, it comes up to your idea to create and produce a foldable chair for elderly people.
2. Personal interest or hobby – hobbies like tinkering motors or machines could develop a
machine shop business and combined with other business like refreshment or snack bar
while waiting for the repair of his car.
3. Friends and relatives – friends or close friends inclined to a hobby of being conscious and
meticulous to beauty products might start a beauty salon business.
4. Family business – considering that you have existing family business shall we say a public
resort-hotel in Calamba, this might lead the creation of a sibling to a swimming accessories
and liquor store within a family business.
5. Suggestions – A suggestion from someone for you to open one considering a service or
product scarcity in the area like opening of a cellphone repair shop due to non-existence of
the service.
6. Education or courses – gain skills by acquiring short courses like cooking, landscaping or
even electronics repair as a means of earning a living.

© 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for
use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website
for classroom use.
ENT101-ENTREPRENEURIAL MIND
7. Prior work experience – past experiences on previous jobs gained skills that leads to a
creation of an enterprise.
8. Research and Development – with the use of questionnaire, customers are requested to
say what they want about a product or service. Through interviews or informal discussions,
middlemen or distributors may give suggestions about a product or service based on their
contact with customers.
9. Creative problem solving – a method of obtaining new ideas focusing on certain
parameters. Creativity can be unlocked and creative ideas and innovation can be generated
by using creative problem solving techniques.
10. Focus Group Discussions – a group of individuals provide information in a structured
format.
11. Brainstorming – a group of individuals meet and they stimulate
12. Problem Inventory Analysis – customers are given a list of problems with a general product
category. The consumers are asked to identify and discuss products in this category with
particular problems. A new product idea may come out from this approach.
13. Other means – new product ideas could also come from other means like need e.g. copying
machine invented because of the need to produce several copies of documents that look
exactly the same as the original especially the signature.

Spotting Opportunities

Identifiable spotting for Business Opportunities

1. Market Need - Be observant and keen in the needs of the people in the community. Mostly in the
community are busy moms perhaps you can put up daycare centers or play school would be a good
business.

2. Location - Your place is near a school with many students. Thus opportunity would be for a store
of school supplies, a snack bar or a shop for sewing uniforms.
3. HOBBY OF THE PEOPLE - The hobby of the women in the community is needle work. Therefore,
your opportunity would be for a store for threads or framing services.
4. AVAILABLE MATERIALS IN THE COMMUNITY - Your community, for instance, is near the sea with
the abundance of shells. Such resources can be made into decorative articles that can be sold
outside of the community.
5. YOUR INTEREST AND KNOW-HOW - Your interest and know-how is, an opportunity. You love
plants, for example, and you are well-versed in taking care of them. Your opportunity is rent a plant
business or plant for sale.

© 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for
use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website
for classroom use.
ENT101-ENTREPRENEURIAL MIND
INNOVATIOIN AND THE ENTREPRENEURS

• Innovation:

 Is the process by which entrepreneurs convert opportunities (ideas) into marketable

solutions.

 Is a combination of the vision to create a good idea and the perseverance and
dedication to remain with the concept through implementation.

 Is a key function in the entrepreneurial process.

 Is the specific function of entrepreneurship.

The Innovation Process

Types of Description Examples

Innovation

Invention Totally new product, service, Wright brothers—airplane

or process Thomas Edison—light bulb
Alexander Graham Bell—telephone

Extension New use or different application of an already Ray Kroc—McDonald’s

existing product, service, Mark Zuckerberg—Facebook
or process Barry Sternlicht—Starwood Hotels
& Resorts

Duplication Creative replication of an existing concept Wal-Mart—department stores

Gateway—personal computers
Pizza Hut—pizza parlor

Synthesis Combination of existing concepts and factors into Fred Smith—Fed Ex

a new formulation or use Howard Schultz—Starbucks

PRINCIPLES OF INNOVATION
Innovation principles really do exist. These principles can be learned and, when combined
with opportunity, can enable individuals to innovate. The major motivation principles follow.
1. Be action oriented: Innovators always must be active and searching for new ideas,
opportunities or sources of innovation.
2. Make the product, process or service simple and understandable: People must
readily understand how the innovation works.
3. Make the product, process or service customer-based: Innovators always must
keep the customer in mind. The more an innovator has the end-user in mind, the
greater the chance the concept will be accepted and used.
© 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for
use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website
for classroom use.
ENT101-ENTREPRENEURIAL MIND
4. Start small: Innovators should not attempt a project or development on a grandiose
scale. They should begin small and then build and develop, allowing for planned
growth and proper expansion in the right manner and at the right time.
5. Aim high: Innovators should aim high for success by seeking a niche in the
marketplace.
6. Try/test/revise: Innovators always should follow the rule of try, test and revise. This
helps work out any flaws in the product, process or service.
7. Learn from failures: Innovation does not guarantee success. More important,
failures often give rise to innovations.
8. Follow a milestone schedule: Every innovator should follow a schedule that
indicates milestone accomplishments. Although the project may run ahead or behind
schedule, it is still important to have the schedule in order to plan and evaluate the
project.
9. Reward heroic activity: This principle applies more to those involved in seeking and
motivating others to innovate. Innovative activity should be rewarded and given the
proper amount of respect. This also means tolerating and to a limited degree,
accepting failures as a means of accomplishing innovation. Innovative work must be
seen as heroic activity that will reveal new horizons for the enterprise.
10. Work, work, work. This is a simple but accurate exhortation with which to
conclude the innovation principles. It takes work-not genius or mystery – to innovate
successfully.

REFERENCES:

Donald F. Kuratko 2019 Entrepreneurship Theory, Process, and Practice 10th edition . Cengage
Learning Asia Pte Ltd

Larsen and Keller. 2017. Entrepreneurship

Marife Agustin-Acierto, 2017 ENTREPRENEURSHIP

Banggawan and Darrel Joe O. Asuncion, 2017. FUNDAMENTALS of ACCOUNTANCY, Business and
Management1 , Rex Bookstore, Manila, Philippines

Cristina B. Banastao and Solita A. Frias, 2008 Entrepreneurship

© 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for
use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website
for classroom use.