Section 2

From Idea to the

Opportunity

Chapter 4
Creativity and the Business Idea

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 Trends
Trends provide opportunities for starting a new venture,
particularly when at the start of a long-lasting trend.
Seven trends providing opportunity:
• Wearable trend.
• Green trend.
• The payments industry.
• Maker trend.
• Mobile trend.
• Health trend.
• The Internet of Things – “smart” devices.

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 Sources of New Ideas
Some of the most fruitful sources of ideas include:
• Consumers.
• Existing products or services.
• Distribution channels.
• The Federal Government.
• Research and development.

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 Methods of Generating Ideas
A focus group is controlled by a moderator leading a group in an
open, in-depth discussion.
Brainstorming allows greater creativity in a group exercise.
• No criticism allowed.
• Freewheeling in encouraged.
• Quantity of ideas is desired.
• Combinations and improvements of ideas is encouraged.

Brainwriting is a written form of brainstorming.

Problem inventory analysis is similar to a focus group but

members focus on product problems rather than new ideas.

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 Creative Problem Solving
Creative problem solving is important.
• Brainstorming is the most widely used technique.
• Reverse brainstorming is similar but criticism is allowed.
• The Gordon method slowly reveals the problem to group members
and asks for suggestions.
• The checklist method is a list of questions to guide the direction of
developing entirely new ideas.
• Free association is a simple method of creating a chain of ideas.
• Forced relationships tries to force product combinations.
• The collective notebook method asks for written suggestions.
• Attribute listing looks at problem attributes from various viewpoints.
• The big-dream approach asks the entrepreneur to think big.
• Parameter analysis involves parameters and creative synthesis.
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 Innovation
Innovation is key to economic development of any company.
Innovation is typed based on the uniqueness of the idea.
• Breakthrough innovations are unique and often establish the platform
on which future innovations are developed – the airplane.
• Technological innovations occur more frequently and offer
advancements in the product/market area – the jet airplane.
• Ordinary innovations occur most frequently and usually extend a
product into a better product – Spanx footless pantyhose.

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 Product Uniqueness
Entrepreneurs define a new product or uniqueness of a product.
• Uniqueness may be in the consumer concept.
• The change may be in the product itself.
• The product may be repackaged.
• The product may have only minor improvements.
• The product may simply be similar to a competitor’s product.

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 New Product Classification
New products may be classified from the viewpoint of the
consumer of the firm.
• Consumers may look at how much behavioral change or new learning
is required.
• Continuous innovations require no new learning or behavior change.
• Dynamically continuous innovations require some relearning.
• Discontinuous innovations are truly new and rare.

• Firms may view newness by differences in the technology used or the

market served.
• Changes in technology may range from no change to brand new.
• Changes in markets range from the same market to a new market.
• Complexity increases with changes in both dimensions.

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 Opportunity Recognition
Some entrepreneurs recognize a business opportunity –
fundamental to the entrepreneurial process.

The key lies in the knowledge and experience of the

entrepreneur.
• Alertness and networks are other important factors.

An opportunity analysis plan is a good method for assessing each

new idea.
• This is not a business plan, but helps decide whether to pursue an
idea.

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 Product Planning and Development Process
Ideas are refined through the production planning and
development process, divided into five major stages.
• This process results in the start of the product life cycle.

Evaluation criteria must be all inclusive and quantitative.

• A market opportunity and adequate market demand must exist.
• Evaluate current competing producers, prices, and policies for impact
on market share.
• New products should have synergy with existing capabilities.
• New products should support and contribute to financial well-being.
• Evaluate compatibility with existing machinery and personnel.
• Evaluate an idea throughout its evolution.

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 Five Major Stages of Product Development
Stage 1: Idea Stage
• Identify promising new products and eliminate impractical ones.
• Determine the need for the product and its value to the company.

Stage 2: Concept Stage

• The refined idea is tested to determine customer acceptance.

Stage 3: Product Development

• Consumer reaction to the physical product is determined.

Stage 4: Test Marketing Stage

• Provides actual sales results, which indicate customer acceptance level.

Stage 5: Commercialization

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 E-Commerce and Business Startup
E-commerce needs assessed throughout the evaluation process.

Use e-commerce creatively – use full in-sourcing, full outsourcing,

or a hybrid approach.
• Front end activities include anything the customer interacts with.
• Back end activities includes IT, payment, search, order fulfillment, etc.

E-commerce channels include:

• Websites.
• Dedicated mobile optimized websites and apps.

E-commerce is essential today.

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