Kathleen R.

Allen

LAUNCHING NEW
VENTURES – AN
ENTREPRENEURIAL
APPROACH, 7E

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 Recognizing and
Shaping an Opportunity
Chapter 3

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service or otherwise on a password-protected website for classroom use.
 Chapter Objectives
⚫Using design thinking to understand
opportunity.
⚫Discuss creativity, its challenges, and how
to develop creative skills.
⚫Understand ideation and its role in problem
solving.
⚫Understand the innovation process.

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service or otherwise on a password-protected website for classroom use.
 Creating Opportunity
⚫Ideas are a commodity
⚫Everyone has them, dozens every day
⚫But entrepreneurs know how to extract
value from those ideas and turn them into
opportunities that have commercial
potential
⚫The difference between an idea and an
opportunity is that an opportunity can turn
into a business
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service or otherwise on a password-protected website for classroom use.
 Creating Opportunity
⚫Design thinking is a people-centered
process
⚫A design thinker employs
◦ Empathy
◦ Integrative thinking
◦ Optimism
◦ Experimentation
◦ Collaboration

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service or otherwise on a password-protected website for classroom use.
 Figure 3.1- Entrepreneurship &
the Elements of Design Thinking

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service or otherwise on a password-protected website for classroom use.
 3.1 Creativity and Inspiration
⚫Creativity:
◦ Enables entrepreneurs to differentiate their
businesses from competitors
◦ Is the basis for invention
◦ Is fundamental to problem solving
◦ Is a critical skill for recognizing or creating
opportunity in a dynamic environment
◦ Is difficult to study because it deals with a
person’s internal thoughts

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service or otherwise on a password-protected website for classroom use.
 3.1 Creativity and Inspiration
⚫An early description of creativity by
Wallas, held that the creative process has 4
stages:
◦ Preparation (see the problem from many views)
◦ Incubation (mulling it over in the subconscious)
◦ Illumination (discovery of a solution)
◦ Verification (bringing the idea to an outcome)
⚫A more recent view comes from Seeff, who
identified seven stages
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service or otherwise on a password-protected website for classroom use.
 7 Steps in the Creative Process
1. Preparation
2. Investigation
3. Trasformation
4. Incubation
5. Illumination
6. Verification
7. Implementation

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service or otherwise on a password-protected website for classroom use.
 Figure 3.2- Entrepreneurship &
the Elements of Design Thinking

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service or otherwise on a password-protected website for classroom use.
 3.1a Challenges to Creativity
⚫Roadblocks may be:
◦ Personal
◦ Problem-solving
◦ Environmental
⚫No time for creativity
◦ Those who multitask are much less productive
⚫No confidence

“Confidence is the expectation of success.”

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service or otherwise on a password-protected website for classroom use.
 3.1b Tools for Creativity & Inspiration
⚫Three Rules of Thumb:
◦ Initially, go for quantity over quality of ideas.
◦ Capture every idea, no matter how outlandish it
may seem.
◦ Piggyback on ideas and create new
combinations and modifications, but only after
first generating ideas at the individual level.

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service or otherwise on a password-protected website for classroom use.
 Tools for Creativity &
3.1b

Inspiration
⚫Brainwriting (a form of brainstorming used
to make sure all on the team feel
comfortable offering ideas.
⚫Visualization (make sense of things; paint a
word picture; identify patterns)
◦ Mindmapping – a way to visually lay out ideas
and organize them
⚫Journey mapping (depicts all touch points
with customers.)
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service or otherwise on a password-protected website for classroom use.
 Figure 3.3-
The Journey Map

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service or otherwise on a password-protected website for classroom use.
 3.2 Opportunity/Ideation
⚫Opportunity is the intersection of an idea
and a customer.
⚫Two theories to explain opportunities:
◦ Discovery theory
● Opportunity arises from shifts in external factors;
waiting for entrepreneurs to discover them; requires
a systematic approach to scanning the environment.
◦ Creation theory
● Entrepreneurs create opportunities by their actions
around new products, services and business models.

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service or otherwise on a password-protected website for classroom use.
 3.3 Find and Frame the Problem
⚫Avoid the natural tendency to want to kill
the “crazy” ideas and adopt the best ones.
⚫Use Affirmative Judgment; articulate the
positives first.
⚫State criticisms in a positive way.
⚫Restate the problem, and ask “why” often.

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 3.3a Restating the Problem
⚫Make sure to restate the problem to define
it correctly
⚫Ask “how” and “why” to break a logjam
created by a problem statement that may
be too narrow or too broad
⚫Table 3.2 demonstrates how a problem
statement can be reworked to get to the
root of the problem

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 Table 3.2-
Restating the Problem

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 3.3b Attribute Identification
⚫Ask:
1. What can we add or take away from this
problem definition?
2. Can we combine this with something else?
3. What if we reverse the problem statement?

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 3.3c Force Fitting
⚫Some of the best ideas come from
connecting things that normally don’t go
together
⚫Take a random object and create a
relationship to the problem definition
you’re dealing with
◦ Example: You have developed an alarm clock
that people can talk to in order to turn it off.
Someone brings in a lamp. How might the
alarm clock turn on the lamp?
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 3.4 Develop Solutions
⚫Use the same techniques used to generate
and focus ideas.
⚫Criteria play a critical role in solution
identification
▪ Explicit: time limits, budgets, constraints
▪ Implicit: considerations such as intuition, team
culture, preferences, prejudices, etc.

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service or otherwise on a password-protected website for classroom use.
 3.5 Innovation
⚫Joseph Schumpeter identified five
categories of innovation:
1. A new product or substantial change in an
existing product
2. A new process
3. A new market
4. New sources of supply
5. Changes in industrial organization

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 Figure 3.4- The Innovation and
Commercialization Process

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service or otherwise on a password-protected website for classroom use.
 Table 3.3-
Sources of Innovation

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 New Venture Action Plan
⚫Do the exercises suggested in Table 3.1,
“Developing Creative Skills”
⚫Practice generating ideas and problems
using the techniques provided in the
chapter
⚫Take one of the sources in Table 3.3 and
come up with an innovation

–© 2016 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.