Why is it important to start a new firm when its "window of opportunity" is open?
It is (1) attractive, (2) durable, (3) timely, and (4) anchored in a product, service, or business that creates or adds value for its buyer or end user.
It is the time period in which a firm can realistically enter a new market. Once the market for a new
Opportunity
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 and some are internally stimulated.
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
Three general approaches entrepreneurs use to identify opportunities.
Observing trends
Solving a problem
Finding gaps in the marketplace
Observing trends
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 changes. As an entrepreneur or potential entrepreneur, it'
Solving a problem
recognize problems and find ways to solve them. These 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.
Finding gaps in the marketplace
There are many examples of products that consumers need or want that aren't avail- able in a particular location or aren't available at all. Part of the problem is created by large retailers, like Walmart and Costco, which compete primarily on price and o
Identify the four environmental trends that are most instrumental in creating business opportunities.
Economic forces
Social forces
Technological advances
Political and regulatory changes
Economic forces
State of the economy, level of disposable income, consumer spending patterns
Social forces
Social and cultural trends, demographic changes, what people think is "in
Technological advances
New technologies, emerging technologies, new uses of old technologies
Political and regulatory changes
New changes in political arena, new laws and regulations
List the personal characteristics that make some people better at recognizing business opportunities than others.
Prior experience
Cognitive factors
Social networks
Creativity
Corridor Principle
Once an entrepreneur starts a firm, new venture opportunities become apparent.
Identify the five steps in the creative process.
Preparation
Incubation
Insight
Evaluation
Elaboration
Preparation
is the background, experience, and knowledge that an entrepreneur brings to the opportunity recognition process.
Incubation
is the stage during which a person considers an idea or thinks about a problem; it is the "mulling things over" phase.
Insight
is the flash of recognition�when the solution to a problem is seen or an idea is born. It is sometimes called the "eureka" experience.
Evaluation
is the stage of the creative process during which an idea is subjected to scrutiny and analyzed for its viability.
Elaboration
is the stage during which the creative idea
is put into a final form: The details are worked out and the idea is transformed into something of value, such as a new product, service, or business concept. Business plan is written
Opportunity recognition process
there is a connection between an awareness of emerging trends and the personal characteristics of the entrepreneur because the two facets of opportunity recognition are interdependent. (Diagram on page 58)
Describe the purpose of brainstorming and its use as an idea generator.
A common way to generate new business ideas. The approaches range from a person sitting down with a yellow legal pad and jotting down interesting business ideas to formal "brainstorming sessions" led by moderators that involve a group of people. Approache