Feasibility 2nd Week
Feasibility 2nd Week
Studies
Assoc. Prof. İrem UÇAL SARI
Istanbul Technical University
10/26/2023 10:21 AM 1
Syllabus
Date Week Topic
6.10.2023 1 General Introduction
13.10.2023 2 Recognizing Opportunities and Generating Ideas
20.10.2023 3 Pre-Feasibility and Feasibility Studies
27.10.2023 4 Market Feasibility
03.11.2023 5 Project presentations (Idea Generation and Prefeasibility)
10.11.2023 6 Project presentations (Idea Generation and Prefeasibility)
17.11.2023 7 Project presentations (Idea Generation and Prefeasibility)
24.11.2023 8 Technical Feasibility
Financial Feasibility Part 1 (Economic Feasibility: NPV, IRR, B/C,
uncertain and risk environments)
1.12.2023 9
Financial Feasibility Part 2 (Financial Statements: Income Statement,
Balance Sheet, Cash Flow Statement)
08.12.2023 10 Financial Models used in feasibility studies
15.12.2023 11 Project Presentations
22.12.2023 12 Project Presentations
29.12.2023 13 Project Presentations
05.01.2024 14 Project Presentations
10/26/2023 10:21 AM 2
Entrepreneurship: Successfully Launching
New Ventures
Sixth Edition
Chapter 2
Recognizing
Opportunities and
Generating Ideas
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
What is an Opportunity? (1 of 2)
Opportunity Defined
• An opportunity is a favorable set of circumstances that
creates a need for a new product, service, or business.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
What is an Opportunity? (2 of 2)
Figure 2.1 Four Essential Qualities of an Opportunity
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Figure 2.2 Three Ways to Identify
an Opportunity
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
First Approach: Observing Trends (1 of 2)
• Observing Trends
– Trends create opportunities for entrepreneurs to pursue.
– The most important trends are:
▪ Economic forces
▪ Social forces
▪ Technological advances
▪ Political and regulatory changes
– It’s important to be aware of changes in these areas.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
First Approach: Observing Trends (2 of 2)
Figure 2.3 Environmental Trends Suggesting Business, Product,
or Service Opportunity Gaps
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Trend 1: Economic Forces
Economic trends help determine areas that are ripe for
new start-ups and areas that start-ups should avoid.
Example of Economic Trend Creating a Favorable
Opportunity
• A weak economy favors start-ups that help consumers
save money.
• An example is GasBuddy.com, a company started to help
consumers save money on gas.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Trend 2: Social Forces
Social trends alter how people and businesses behave
and set their priorities. These trends provide opportunities
for new businesses to accommodate the changes.
Examples of Social Trends
• Aging of the population.
• The increasing diversity of the population.
• Millennials entering the workforce.
• Growth in the use of mobile devices.
• An increasing focus on health and wellness.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Trend 3: Technological Advances (1 of 2)
Advances in technology frequently create business
opportunities.
Examples of Entire Industries that Have Been
Created as the Result of Technological Advances
• Computer industry
• Internet
• Biotechnology
• Digital photography
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Trend 3: Technological Advances (2 of 2)
Once a technology is created, products often emerge to
advance it.
Example: Rokit Boost
An example is Rokit Boost, a high-end mobile accessories
company that makes smartphone cases, headphones,
portable USB device chargers, and Bluetooth speakers.
Rokit Boost wouldn’t exist if it weren’t for the advent of the
smartphone.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Trend 4: Political Action and Regulatory
Changes (1 of 2)
Political and regulatory changes also provide the basis for
opportunities.
General Example
This happened with the passage of the Affordable Care Act
in 2010. The provisions of the act yielded opportunities for
entrepreneurs to launch electronic records start-ups, apps to
help patients monitor their medication, and similar
companies.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Trend 4: Political Action and Regulatory
Changes (2 of 2)
Political change also engenders new business and
product opportunities. For example, global political
instability and the threat of terrorism have resulted in many
firms becoming more security-conscious.
Specific Example
Evolv Technology is a start-up that has assembled a
multidisciplinary team of experts to identify, invent, and
apply new technologies to meet current terrorism-related
threats.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Second Approach: Solving a Problem (1 of 2)
• Solving a Problem
– Sometimes identifying opportunities simply involves
noticing a problem and finding a way to solve it.
– These problems can be pinpointed through observing
trends and through more simple means, such as
intuition, serendipity, or chance.
– Many companies have been started by people who
have experienced a problem in their own lives, and then
realized that the solution to the problem represented a
business opportunity.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Second Approach: Solving a Problem (2 of 2)
Specific Example
Sometimes people aren’t able to access energy to recharge
their smartphones for a period of time. A number of
companies have solved this problem in innovative ways. An
example is the $70 Eton BoostTurbin 2000, which is a
device that weighs less than four ounces. It combines a
battery with a hand crank that provides enough power to
fully charge a typical smartphone.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Third Approach: Finding Gaps in the
Marketplace (1 of 2)
• Gaps in the Marketplace
– 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.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Third Approach: Finding Gaps in the
Marketplace (2 of 2)
Product gaps in the marketplace represent potentially
viable business opportunities.
Specific Example
Tish Cirovolo realized there were no guitars on the market
made specifically for females. To fill this gap, she started
Daisy Rock Guitars, a company that makes guitars just for
women and girls. Daisy Rock guitars are stylish, come in
feminine colors, and incorporate design features that
accommodate a woman’s smaller hand and build.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Personal Characteristics of the
Entrepreneur
Characteristics that tend to make some people better at
recognizing opportunities than others
• Prior Industry Experience
• Cognitive Factors
• Social Networks
• Creativity
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Prior Industry Experience (1 of 2)
• Prior Industry Experience
– Studies have shown that prior experience in an
industry helps an entrepreneur recognize business
opportunities.
▪ By working in an industry, an individual may spot a
market niche that is underserved.
▪ It is also possible that by working in an industry, an
individual builds a network of social contacts who
provide insights that lead to recognizing new
opportunities.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Prior Industry Experience (2 of 2)
• Prior Industry Experience
– It is also important to note that anecdotal evidence
suggests that people outside an industry can
sometimes enter it with a new set of eyes, and as a
result innovate in ways that people with prior
experience might find difficult.
▪ For example, Elon Musk, the founder of Tesla, had
no prior experience in the auto industry.
▪ Debbie Fields, the founder of Mrs. Fields Cookies,
had no prior experience in the food industry.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Cognitive Factors
• Cognitive Factors
– Studies have shown that opportunity recognition may
be an innate skill or cognitive process.
– Some people believe that entrepreneurs have a “sixth
sense” that allows them to see opportunities that others
miss.
– This “sixth sense” is called entrepreneurial alertness,
which is formally defined as the ability to notice things
without engaging in deliberate search.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Social Networks (1 of 3)
• Social Networks
– The extent and depth of an individual’s social network affects
opportunity recognition.
– People who build a substantial network of social and
professional contacts will be exposed to more opportunities
and ideas than people with sparse networks.
– Research results suggest that between 40% and 50% of
people who start a business got their idea via a social contact.
• Strong-Tie Vs. Weak-Tie Relationships
– All of us have relationships with other people that are called
“ties.” (See next slide.)
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Social Networks (2 of 3)
• Nature of Strong-Tie Vs. Weak-Tie Relationships
– Strong-tie relationships are characterized by frequent
interaction and form between coworkers, friends, and
spouses.
– Weak-tie relationships are characterized by infrequent
interaction and form between casual acquaintances.
• Result
– It is more likely that an entrepreneur will get new
business ideas through weak-tie rather than strong-tie
relationships. (See next slide.)
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Social Networks (3 of 3)
Why weak-tie relationships lead to more new business ideas
than strong-tie relationships
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Creativity (1 of 2)
• Creativity
– Creativity is the process of generating a novel or
useful idea.
– Opportunity recognition may be, at least in part, a
creative process.
– For an individual, the creative process can be broken
down into five stages, as shown on the next slide.
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Creativity (2 of 2)
Figure 2.4 Five Steps to Generating Creative Ideas
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
Full View of the Opportunity Recognition
Process
• Depicts the connection between an awareness of emerging
trends and the personal characteristics of the entrepreneur
Figure 2.5 The Opportunity Recognition Process
Copyright © 2019, 2016, 2012 Pearson Education, Inc. All Rights Reserved.
PREFEASIBILITY
ANALYSIS
1 IDEA GENERATION
PROCESS
2 PREFEASIBILITY REPORT
10/26/2023 10:21 AM 29
IDEA GENERATION PROCESS
TECHNIQUES
REVERSE BRAIN
BRAIN
STORMING STORMING 5W1H
Generating an unlimited 2
number of ideas
Evaluation of ideas 4
10/26/2023 10:21 AM 32
PROBLEM: How can I be a good
candidate for long-term
internships?
Ideas:
10/26/2023 10:21 AM 33
PROBLEM: How can I be a good
candidate for long-term
internships?
Develop Relevant Skills: Identify the key skills required for the internship and
work on honing them through courses, online tutorials, or personal projects.
Network: Attend industry events, career fairs, and networking sessions to
connect with professionals in your field of interest.
Craft a Strong Resume: Tailor your resume to highlight your relevant
experiences, skills, and achievements that make you a suitable candidate.
Create an Impressive Portfolio: Showcase your previous work, projects, and
accomplishments in a well-organized portfolio or website.
Research the Company: Learn about the company's mission, values, and recent
projects to demonstrate your genuine interest during interviews.
10/26/2023 10:21 AM 34
PROBLEM: How can I be a good
candidate for long-term
internships?
Customize Cover Letters: Write personalized cover letters for each application,
outlining how your skills align with the internship's requirements.
Display Enthusiasm: During interviews, express your passion for the industry
and your eagerness to learn and contribute.
Be Reliable: Consistently meet deadlines, attend meetings promptly, and show
commitment to your tasks.
Seek Feedback: Welcome constructive criticism and show your willingness to
learn and improve based on feedback.
Collaborate Effectively: Highlight your teamwork skills by sharing experiences
where you've successfully collaborated on projects.
10/26/2023 10:21 AM 35
PROBLEM: How can I be a good
candidate for long-term
internships?
Demonstrate Initiative: Proactively take on additional tasks, propose ideas, or
suggest improvements to showcase your drive.
Stay Flexible: Be open to changes and demonstrate your adaptability in a
dynamic work environment.
Communicate Clearly: Practice effective communication, both written and
verbal, to convey your ideas and questions clearly.
Show Problem-Solving Abilities: Describe situations where you identified
challenges and successfully found solutions.
Exhibit Professionalism: Maintain a polished and respectful demeanor, even in
challenging situations.
10/26/2023 10:21 AM 36
PROBLEM: How can I be a good
candidate for long-term
internships?
Be Curious: Ask thoughtful questions about the company, industry trends, and
your role to demonstrate your genuine curiosity.
Attend Workshops/Seminars: Participate in relevant workshops or seminars to
further develop your skills and industry knowledge.
Stay Positive: Maintain a positive attitude, even in the face of setbacks, and
focus on finding solutions rather than dwelling on problems.
Cultivate Soft Skills: Develop skills like time management, adaptability, and
emotional intelligence, which are valuable in any work environment.
Follow Up: Send a thank-you email after interviews and follow up on your
application status to demonstrate your continued interest.
10/26/2023 10:21 AM 37
REVERSE BRAIN STORMING
10/26/2023 10:21 AM 39
PROBLEM: How can I make sure I'm
a terrible candidate for long-term
internships?
Avoid All Communication: Never respond to emails, phone calls, or
messages from potential employers or internship coordinators.
Show Up Late (or Not at All): Arrive late for interviews, meetings, and
workdays, or simply don't show up without any notice.
Neglect Appearance: Dress inappropriately or unprofessionally for
interviews and workdays.
Ignore Instructions: Disregard any instructions given by supervisors or
mentors and proceed with tasks as you see fit.
Refuse to Learn: Act uninterested in learning new skills or improving your
knowledge relevant to the internship.
10/26/2023 10:21 AM 40
PROBLEM: How can I make sure I'm
a terrible candidate for long-term
internships?
Be Disruptive: Constantly disrupt the workplace by being loud, distracting,
or engaging in inappropriate behavior.
Don't Ask Questions: Avoid seeking clarification on tasks or projects,
leading to misunderstandings and mistakes.
Procrastinate: Leave tasks until the last minute or fail to meet deadlines
consistently.
Complain Regularly: Voice complaints about the internship, the tasks, and
the people you're working with.
Never Take Initiative: Always wait for someone else to assign tasks and
responsibilities to you.
10/26/2023 10:21 AM 41
PROBLEM: How can I make sure I'm
a terrible candidate for long-term
internships?
Miss Opportunities: Turn down any chances for extra work, learning
experiences, or networking opportunities.
Be Inflexible: Refuse to adapt to changes in the work environment,
procedures, or team dynamics.
Lack Enthusiasm: Display a complete lack of enthusiasm for the work and
the industry you're interning in.
Disregard Feedback: Ignore or dismiss feedback from supervisors and
colleagues, never making any improvements.
Avoid Collaboration: Isolate yourself from the team, avoid teamwork, and
hinder group projects.
10/26/2023 10:21 AM 42
PROBLEM: How can I make sure I'm
a terrible candidate for long-term
internships?
Break Company Rules: Deliberately break workplace rules and policies,
disregarding ethical and professional standards.
Constantly Make Excuses: Provide excuses for incomplete or subpar work
instead of taking responsibility.
Spread Negativity: Create a negative atmosphere by criticizing others and
their ideas openly.
Be Unreliable: Make commitments you can't fulfill and consistently fail to
meet obligations.
Undermine Authority: Challenge and question the decisions and authority of
your supervisors and mentors.
10/26/2023 10:21 AM 43
X
Brain Storming: What can be done to reduce
1 internet addiction ?
Reverse Brain Storming: What can be done to
make people more addicted to the internet?
10/26/2023 10:21 AM 44
Focus Groups
10/26/2023 10:21 AM 45
5W1H
WHAT WHO WHERE
Description of the problem; The responsible parties; The location of the problem;
• What is the project? • Who is the client? • Where will the project
• What are the objectives • Who are the users? take place?
• Who are the members of
the team ?
10/26/2023 10:21 AM 48
FISH BONE DIAGRAM
10/26/2023 10:21 AM 49
FISH BONE EXAMPLE
10/26/2023 10:21 AM 50
FISH BONE EXAMPLE
10/26/2023 10:21 AM 51
FORCED RELATIONSHIPS
• Developing a new idea by looking at product combinations.
• Most of these ideas may not be revolutionary discoveries but they are still
advantageous products and usually have a prospective market in society.
10/26/2023 10:21 AM 52
FORCED RELATIONSHIPS-
EXAMPLE
STREET TECHNOLOGY
Garbage Internet
Street animals Big Data
Parked cars GPS
Traffic Computer
Mud Microchip
Umbrella Remote control
Bench Camera
Playground Television
Sport Games
Shopping Sensors
Street animals with chips
Application that displays the occupancy of parking spaces
Displaying sports videos with the screen to the sports fields
10/26/2023 10:21 AM 53
SCAMPER
• Start by stating the problem you wish to solve or the thought you
wish to develop.
• Once you have identified the challenge, you need to come up with
questions.
10/26/2023 10:21 AM 54
SCAMPER
• S = Substitute What to substitute in my process of selling?
• C = Combine How do I blend selling with other activities?
• A = Adapt What to copy or adapt the selling process of another person or
• Company?
• M = Magnify What do I put more weight on or magnify when selling?
• P = Put to other uses What other uses can I put my selling to?
• E = Eliminate (Minify) What do I eliminate or make easier in my process
• of selling?
• •R = Rearrenge (alternative is Reverse) How do I change, reverse or
• reorder my manner of selling?
10/26/2023 10:21 AM 55
• Put to other uses: Selling
SCAMPER restaurants and real estate instead
of just simply hamburgers.
10/26/2023 10:21 AM 56
OTHERS
• Problem Inventory Analysis
• Consumers are provided with a list of problems and are asked to
identify products that have those problems.
• Results must be carefully evaluated as they may not actually reflect a
new business opportunity.
• Attribute Listing
• Developing a new idea by looking at the positives and negatives.
• Big Dream Approach
• Developing a new idea by thinking without constraints.
10/26/2023 10:21 AM 57
SAMPLE PROJECTS
10/26/2023 10:21 AM 58
FEASIBILTY STUDIES
INSTRUCTOR: İREM UÇAL SARI
WHY HOW
Delayed service time, Barista robot, putting a
tasteless food/drinks, tablet in tables that pays-
nowhere to sit, customers orders food/drinks.
don’t get what they
ordered for,
complications when
paying for order.
Solution Ideas
Looking at the diagram and the table, it is clear that the
problems are mostly caused by employees and customers.
Since many people are coming to the place at rush hours,
they need to be adapted to meet the demand. Renting a
bigger place, hiring more employees, training employees,
buying new equipment could solve our problem but it
probably costs a lot. Replacing the some of the employees
with a robot could be our solution.
In the problem section, it was
mentioned that problems are
BARISTA
mostly caused by human factor. ROBOTS
So, replacing humans with
robots could be the solution for
cafes in their take-away
branches; such as downtowns,
university campuses and Drive-
Through’s.
• Robots are able to prepare
orders more accurately.
ADVANTAGES
• They are suitable for cafés
with take-away branches.
• Customers cannot complain
about employee behavior
anymore.
• Robots are more skillful
performing “latte art”.
• Robot doesn’t need training.
• Expensive investment. DISADVANTAGES
• Maintenance is required
periodically.
• Slower movements.