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Entrepreneurship: by Beenish Qureshi Visiting Faculty

This document discusses recognizing opportunities and generating business ideas. It explains that opportunities arise from observing trends in the environment, such as economic, social, technological and political changes. Entrepreneurs must understand the difference between an idea and a true business opportunity. Opportunities exist when there is a need created by these trends that is not being addressed. The document also discusses identifying opportunities by solving problems or finding gaps in the marketplace. Generating ideas involves brainstorming, research and maintaining an idea bank to later develop into real opportunities.

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Hermain Fayyaz Karim
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38 views

Entrepreneurship: by Beenish Qureshi Visiting Faculty

This document discusses recognizing opportunities and generating business ideas. It explains that opportunities arise from observing trends in the environment, such as economic, social, technological and political changes. Entrepreneurs must understand the difference between an idea and a true business opportunity. Opportunities exist when there is a need created by these trends that is not being addressed. The document also discusses identifying opportunities by solving problems or finding gaps in the marketplace. Generating ideas involves brainstorming, research and maintaining an idea bank to later develop into real opportunities.

Uploaded by

Hermain Fayyaz Karim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Entrepreneurship

By
Beenish Qureshi
Visiting Faculty
Chapter 2
Recognizing Opportunities & Generating Idea
Learning Objectives

• Explain why it’s important to start a new firm when its “window of opportunity” is open
• Explain the difference between an opportunity and an idea
• Describe the three general approaches entrepreneurs use to identify opportunities
• Identify the four environmental trends that are most instrumental in creating business opportunities
• List the personal characteristics that make some people better at recognizing business opportunities
than others
• Identify the five steps in the creative process
• Describe the purpose of brainstorming and its use as an idea generator
• Describe how to use library and Internet research to generate new business ideas
• Explain the purpose of maintaining an idea bank
• Describe three steps for protecting ideas from being lost or stolen
Chapter Introduction

• In this chapter, we will discuss the importance of understanding the difference between ideas and
opportunities
• While ideas are interesting and can intrigue us as possibilities, not every idea is in fact the source of
an opportunity for an entrepreneur to pursue
• Essentially, entrepreneurs recognize an opportunity and turn it into a successful business
Identifying And Recognizing Opportunities

• An opportunity is a favorable set of circumstances that creates a need for a new product, service, or
business
• Most entrepreneurial ventures are started in one of two ways
• Some ventures are externally stimulated. In this instance, an entrepreneur decides to launch a firm,
searches for and recognizes an opportunity
• Other firms are internally stimulated. An entrepreneur recognizes a problem or an opportunity gap
and creates a business to address the problem or fill the identified gap
• A common mistake entrepreneurs make in the opportunity recognition process is picking a currently
available product or service that they like or are passionate about and then trying to build a business
around a slightly better version of it
Four Essential Qualities of an Opportunity
Identifying And Recognizing Opportunities

• For an entrepreneur to capitalize on an opportunity, its window of opportunity must be open


• The term window of opportunity is a metaphor describing the time period in which a firm can
realistically enter a new market
• Once the market for a new product is established, its window of opportunity opens
• As the market grows, firms enter and try to establish a profitable position
• At some point, the market matures, and the window of opportunity closes
Difference B/w An Opportunity & An Idea

• An idea is a thought, an impression, or a notion. An idea may or may not meet the criteria of an
opportunity
• This is a critical point because many entrepreneurial ventures fail not because the entrepreneurs that
launched them didn’t work hard, but rather because there was no real opportunity to begin with
Three Ways to Identify an Opportunity
Three Ways To Identify Opportunities

Observing Trends
• The first approach to identifying opportunities is to observe trends and study how they create opportunities for
entrepreneurs to pursue
• The most important trends to follow are economic trends, social trends, technological advances, and political action and
regulatory change
❑ Economic Forces
• When the economy is strong, people have more money to spend and are willing to buy discretionary products and
services that enhance their lives
• In contrast, when the economy is weak, not only do people have less money to spend, they are typically more reluctant to
spend the money
• Paradoxically, a weak economy provides business opportunities for start-ups that help consumers and businesses save money
Three Ways To Identify Opportunities -
Important Trends To Follow

❑Social Forces
• 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
• Often, the reason that a product or service exists has more to do with satisfying a social need than the
more transparent need the product fills
❑Technological Advances
• Advances in technology frequently dovetail with economic and social changes to create opportunities
• Technological advances also provide opportunities to help people perform everyday tasks in better or
more convenient ways
Three Ways To Identify Opportunities –
Important Trends To Follow

❑Political Action and regulatory Changes


• Political and regulatory changes also provide the basis for business ideas
• Political change also engenders new business and product opportunities
• One thing entrepreneurs invariably do when a changing environmental trend prompts them to think
about a business opportunity is to learn more about the trend in an effort to shape and mold their
idea
First Approach: Observing Trends
2 of 2

Environmental Trends Suggesting Business


or Product Opportunity Gaps
Three Ways To Identify Opportunities

Solving a Problem
• The second approach to identifying opportunities is to recognize problems and find ways to solve
them
• Problems can be recognized by observing the challenges that people encounter in their daily lives
and through more simple means, such as intuition, serendipity, or chance
“Every problem is a brilliantly disguised opportunity”
Three Ways To Identify Opportunities

Gaps in the market place:


• A third approach to identifying opportunities is to find a gap in the marketplace
• A gap in the marketplace is often created when a product or service is needed by a specific group
of people but doesn’t represent a large enough market to be of interest to mainstream retailers
or manufacturers.
•Thankyou

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