Idea Generation & Opportunity Assessment
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Transcript of Idea Generation & Opportunity Assessment
Idea Generation & Opportunity Assessment
Presented byRich Bendis, CEO
Innovation America
Temple Entrepreneurship
Temple is: A national leader in entrepreneurship education and
applied learning Ranked 6th in the U.S. for undergraduate programs by
Entrepreneur magazine and the Princeton Review Cited for excellence in entrepreneurship by Fortune
Small Business, forbes.com and U.S. News and World Report
Characteristics of Successful Entrepreneurs
Passion for the business Vision and endless ideas Product/customer focus: Must
satisfy customer needs Persevere through setbacks and
failures Executional excellence: Translate
creativity into action & generate measurable returns
The Power of Entrepreneurial Thinking
What makes a successful entrepreneur?– Seeing opportunity where
others don’t– Innovation: better, faster,
cheaper, easier– “Fire in the Belly”– Willingness to take risks– Extreme work ethic
Increasing Relevance to Founding Venture
Three Key Processes
Idea Generation Creativity Opportunit
y Recognitio
n
Kinds of Intelligence Analytic intelligence - The ability to analyze and
evaluate ideas, solve problems and make decisions Creative intelligence - Going beyond what is
given to generate novel and interesting ideas. Practical intelligence - The ability that
individuals use to find the best fit between themselves and the demands of the environment
Social intelligence - The ability to understand and manage all types of people and to act wisely in human relations
Successful intelligence - The acquisition and use of what you need to know to be successful in a particular environment.
PracticalIntelligence
CreativeIntelligence
AnalyticIntelligence SuccessSuccessful
Intelligence
Successful Intelligence
Confluence Approach
Creativity emerges from a confluence of Intellectual abilities Broad, rich knowledge base Appropriate style of thinking Personality attributes Intrinsic, task-focused motivation Environment supportive of creative
ideas
Additional Aspects
Active searchEntrepreneurial
alertnessPrior knowledgeSocial networks
Opportunityrecognition
Pattern Recognition
Seeing links between seemingly unconnected trends, changes, events
Connections form an identifiable pattern
Entrepreneurial Opportunity
Situation in which a person can develop a new business idea that has potential to generate profit
Opportunities from Change
Truly valuable entrepreneurial opportunities come from an external change that either:
Makes it possible to do things that had not been done before
Makes it possible to do something in a more valuable way.
Change Leads to Potential
New technology Political and regulatory shifts Social and demographic change
Potential
Forms of Opportunity
Entrepreneurs develop business ideas by: Developing new products and services Tapping new markets Formulating new methods of production Identifying new raw materials Developing new ways of organizing processes
Recognizing Opportunities & Generating Ideas
Idea is thought, impression, notion Opportunity: favorable set of circumstances that
create need for product or service. Ex: Jeff Bezos/Amazon
Opportunity has four essential qualities Attractive Durable Timely Creates/adds value for buyer/user
Recognizing Opportunities & Generating Ideas
Observing/Study Trends• Economic factors• Social factors• Technological
Advances• Political Action and
regulatory statutes
Recognizing Opportunities & Generating Ideas
Economic Forces– Consumers level of disposable
income– Interest rate changes– More women in workforce– Currently: global recession
Social Forces– Both parents working: fast food– People too busy: digital organizers– Life stress: spas, wellness clinics
Recognizing Opportunities & Generating Ideas
Family & work patterns Aging of the population Increasing diversity in the workplace Globalization of industries Increased focus in health care & fitness Proliferation of computers & Internet Increase in numbers of cell phone users New forms of music & entertainment
Recognizing Opportunities & Generating Ideas
Technological Advances– Cell phones: allows people to be mobile– E-commerce: accommodates busy schedules
and working from home/remote locations Political Action
– New laws: help companies comply; ex: SoX– Terrorism: Products & services to protect
Recognizing Opportunities & Generating Ideas
Solving a Problem Observe people’s challenges Look for problems Listen to people’s complaints Think of your own challenges
Recognizing Opportunities & Generating Ideas
Personal characteristics for opportunity recognition
Prior experience in an industry Entrepreneurial alertness/6th sense Social networks Creativity: preparation, incubation,
insight, evaluation, elaboration
Small Group Exercise: What Opportunities Exist?
Group should choose a market and identify a BIG PERVASIVE PROBLEM customers face.
Brainstorm some products or services to solve those problems
Share ideas with larger group
Techniques in Generating Ideas
Brainstorming: generate ideas quickly, no analysis or decision making– Enthusiasm, originality, lots of ideas– Freewheeling, lively– No criticism allowed– Session moves quickly– Leapfrogging encouraged
Techniques in Generating Ideas
Focus groups• People selected are familiar with
issues• What’s on customers mind• Conducted by trained moderator• Success depends on moderator’s
ability to ask questions and keep on track
Techniques in Generating Ideas
Surveys: gathering info from sample of individuals• By phone, mail, online, in person• Random portions of population• Customer Advisory Boards
Feasibility Analysis
The process to determine if a business idea is viable worth pursuing• Product/service feasibility analysis• Industry/market feasibility• Organizational feasibility• Financial feasibility
Product/Service Feasibility Analysis
Concept testing: validate customer interest, desirability & purchase intent• Validate underlying premise• Help develop the idea• Try to estimate sales
Product/Service Feasibility Analysis
New Business Concept Paper - Description of product/service offered - Intended target market - Benefits of product/service - Description of how the product will be
positioned versus similar ones in market - Description how the product would be sold
or distributed.
Product/Service Feasibility Analysis
Usability Testing: measures product’s ease of use and the user’s perception of the experience using model/prototype
Industry/Market Feasibility Analysis
• Industry attractiveness• Market timeliness• Identification of niche market
Industry/Market Feasibility Analysis
Industry Attractiveness Large and growing Important to the customer Fairly young rather than older/mature High rather low operating margins Not being crowded
Primary and secondary research is needed
Industry/Market Feasibility Analysis
Market Timeliness - Improved product = market exists - Breakthrough product: - First mover advantage - Second mover advantage Identifying a niche market
Organizational Feasibility Analysis
Sufficient management expertise, organizational competence & resources to successfully launch a business
- Management ability - Resource sufficiency
Financial Feasibility Analysis
Total start-up cash needed Financial performance of similar
businesses Overall financial attractiveness of
the proposed venture
Evaluating Opportunities: “Quick Screen”
Looks at:– Markets and Margins– Competitive Advantages– Value Realization– Overall Potential
Exercise: Evaluate your group’s idea using the first two screens
Markets and Margins
Need/want/problem
Identified Unfocused
Customers Reachable, receptive
Unreachable, loyal to others
Market Size $100 million +
Less than $10 million
Market Growth Rate
More than 20%
Less than 20% or shrinking
Gross Margin >40%, durable
<20%, fragile
Competitive Advantages
Barriers to Competitors’ Entry
Defensible None
Contacts and Networks
Key access Limited
Degree of Control
High Low
Prices and Cost
High Low
Supply/distributionChannels
High Low
I know quite certainly that I myself have no special talent; curiosity, obsession and dogged
endurance, combined with self-criticism, have brought me to my ideas.
- Albert Einstein
The air is full of ideas. They are knocking you in the head all the time. You only have to know what
you want, then forget it, and go about your business. Suddenly, the idea will come through. It
was there all the time.- Henry Ford
A mediocre idea that generates enthusiasm will go further than a great idea that inspires no one.
- Mary Kay Ash