Creativity and Business Idea:

Chapter 4

PINKY SHARMA
Identify and Recognizing Opportunities
 Identify and Recognizing Opportunities
Find a business opportunity in every market need.
•  all enterprising ventures answer, in one way or another, a
particular human need.
• Whether it is a product or a service, it must respond to what the
buyers need or want.
• Begin by studying your own community, village, or barangay. Is
it self-sufficient or do the residents have to go out of their way to
buy pandesal, cooked food, or cooking oil?
• Or to have their shoes repaired, their cars washed, or their homes
pest-protected?
Study demand and supply gaps.
• Find out how the present demand for certain products
or services in the community is being met. Is demand
for some items being filled by local suppliers or
producers?
• Find out whether or not local supply can cope with or
totally satisfy local demand. If not, this may suggest
that there is room for still one more in the business.
Study import-export movements.
• Again, perhaps a number of products are being supplied by
producers or suppliers outside the community or imported from
other countries. Study these imports.
• Possibly, given the resources, you can produce these. You may
not be able to produce the same high quality as the imported
ones.
• However, if you can produce at a much lower cost and sell the
products cheaper, you have a competitive advantage there. You
may find that your products though cheaper and of lower
quality will also be attractive in the market.
• For example, locally made Rara noodles, Current Spicy noodle,
2 PM Spicy noodle have become acceptable substitutes for
imported Ramen and Samyang Noodles.
Capitalize on available resources.
• The availability of certain resources in an area
can suggest business opportunities. These
resources may be in the form of raw materials,
skills, information or technology.
 Resources
Raw materials
• Identify the materials that are native to and abundant in an
area. Study how to make money out of these either through
gathering the materials, trading them, partially processing
them, or manufacturing finished products out of them.
Local skills
• Are specialized, traditional skills available in the community?
Can these be used for commercial purposes? Study these skills
for possible upgrading and innovation. The availability of
skilled weavers in a community, for example, can be tapped
by organizing a weaving, handloom, or handicraft industry.
Industry information 
• Reading technical and business journals will keep you
updated on business ideas. Newsweek Magazine, for
example, has a regular feature on new products and
techniques. 
• Many private and government institutions conduct
periodic studies which review the growth and
performance of certain industries. Such studies discuss a
given industry’s problems and prospects for growth and
expansion. Obviously, they would provide useful
information that will help you make wise investment
decisions
Technology:
• Look out for advances or improvements in
technology. These might be useful in
upgrading or improving traditional production
systems or starting a new business altogether.
• For example, research and development in
aquaculture has made prawn and bangus
culture a viable business venture. 
 Lessons from Street Vendors
Adapt, complement, reshape.
• Be observant. What are the people around you doing?
Can you pick up something from it – with some
modification?
• Get familiar with the current economic situation in
communities comparable to where you live. You can
be inspired by a number of projects which have
worked in these areas and which you can adapt to
your own local situation
 Creativity--- introducing the concept

 Creativity is:
• Part of spotting market opportunities
• Essential in generating all innovation
• Relies in tacit knowledge, individual creativity and
learning
• Key ingredient of entrepreneurial architecture
 Therefore we can define creativity as:
• The ability to develop new ideas, concepts and processes,
often to create solutions to problems or opportunities that
customers face.
Creativity -components

Motivation
Creative
Expertise Thinking
Skills

Creativity
 Components of creativity
• Expertise: Technical , procedural and intellectual knowledge.
• Motivation: Motivation is generally accepted as key to
creative production, and the most important motivation are
intrinsic passion and interest in work itself.
a. Intrinsic- influenced by work environments.
b. Extrinsic: tangible rewards
• Creative thinking skills: relates to how people approach
problems and depends on personality and thinking/working
place. Creative thinking skills determine how flexible and
imaginatively people approach problems.
Types of Creativity ,Various authors suggested different types
of creativity:

1 Abraham Maslow
i. Primary Creativity :deals with spontaneous
creations.
ii. Secondary Creativity : more deliberate and
skilled as in the application of ideas and
insight to invention.
2. Ainsworth Land
i. Elaborative
ii. Improvement Oriented
iii. Combination or Synthesis of superior quality
iv. Transformation
3. Iring Taylor:
Author suggested following quality hierarchy:
i. Spontaneous Creativity : similar to Maslow’s primary creativity
ii. Technical Creativity : involves striking improvement in a process
iii. Inventive Creativity : involves ingenuous new combination of
materials or ingredients
iv. Innovative Creativity : involves far-reaching application of more
basic ideas
v. Emergentive Creativity : consist of new revolutionary principles
for an art or sciences
 Creativity Process
A. Idea Germination: Idea germination occurs before the
innovation finally takes place. The inconvenience that he/she is
facing Personal insights blended through curiosity to solve a
problem.
B. Preparation: This phase is characterized by acquisition of
necessary information and materials required to practice the
germinated idea.
C. Incubation(development): Daydreaming, thinking about the
problem before going to the bed, starting to work on the different
dimension of the idea etc.
D. Illumination (Enlightenment ): This is the happiest
moment an individual experiences with the real
observance of the idea taking into effect. This process
gives the first evidence or symptom of success.
E. Verification: This stage is related to the development
of knowledge into workable state. The illumination is
translated into practice or commercial application
which warrants an entrepreneurs to support for years.
 Stages in Creativity
Step 1
Opportunity or
problem recognition

Step 2
immersion

Step 3
Incubation

Step 4
Verification &
Application

Step 5
Insight
 STAGES IN THE CREATIVE
PROCESS
1. Opportunity or Problem Recognition: A person
discovers that a new opportunity exists or a problem
needs resolution.
2. Immersion: The individual concentrates on the
problem and becomes immersed in it. He or she will
recall and collect information that seems relevant,
dreaming up alternatives without refining or evaluating
them.
3. Incubation: The person keeps the assembled
information in mind for: a while. He or she does not
appear to be working on the problem actively;
however, the subconscious mind is still engaged.
While the information is simmering it is being
arranged into meaningful new patterns.
4. Insight: The problem-conquering solution flashes into
the person's mind at an unexpected time, such as on
the verge of sleep, during a shower, or while running.
• Verification and Application: The individual sets out
to prove that the creative solution has merit.
Verification procedures include gathering supporting
 Importance
• To thrive in business, we must be creative.
• To obtain competitive edge in business creativity is essential
• Creativity is the root of innovation.
• Innovation is specific tool of entrepreneurs the means of
which they exploit change as an opportunity for a different
business or different service.
• Creativity is the process of bringing something new into
being..
• Creativity requires passion and commitment.
• A product is creative when it is (a) novel and (b) appropriate
 Sources of new venture ideas
1. Research and development (R&D)
2. Suppliers
3. Internet
4. Distribution channels
5. Governments
6. Newspapers and magazines
7. Trade fairs
8. Brainstorming
 Techniques for generating ideas
1. Focus group
A focus group is the group of 6 to 12 persons. They
represent various socio-economic backgrounds.
They are experts in the concerned groups. The
focus discussion is facilitates by a moderator. The
group members are asked about their perception,
attitude, belief towards a product, service, concept
or idea. The participants talk with other group
member and come up with their conclusion
2. Brainstorming
• Brainstorming is a relaxed and informal approach to
problem solving and idea development. This helps
people come out from normal ways of thinking. Ideas
are not criticized and rewarded.
• Brainstorming session are more like fun than
pressure. It lasts for 10 min. to 1 hour and the
members are also not required to prepare much.
3. Reverse Brainstorming
It is similar to brainstorming, except the criticism is
allowed. The technique is based on finding fault by
asking question.
How many ways can this idea fail?
4. Brain writing
• Brain writing is easy. Instead of asking the
participants to shout out ideas, they are told to pen
down their ideas pertaining to a specific problem
or question on sheets of paper, for a small number of
minutes.
• After that, each participant can pass their ideas over
to someone else. This someone else reads the ideas on
the paper and adds some new ones.
5. Problem inventory analysis
• Instead of generating new ideas, the customers are
provided with list of problems associated with
existing products. They are asked to discussed
about the products that have similar problems.
• The technique is used to develop new product
idea through the analysis of the problems
associated with the existing products.
6. Collective notebook method
• Developing a new idea by group members regularly
recording ideas keeping a small notebook in pocket,
preferably three times a day.
• At the end of a week, a list of the best ideas is
developed, along with any suggestions.
7. Big dream approach
• Developing a new ideas by thinking without
constraints
8. The Delphi technique
• It is a structured forecasting technique. It relies on a
penal of experts.
• The experts give their opinion in two or more round.
The experts are encouraged to revise their earlier
opinion. It provides a heterogeneity mix of
knowledge and ideas which have better chances of
success.
 Protecting the Idea:
Intellectual Property Rights and its
Components.

Definition: Intellectual property rights refers to the

general term for the assignment of property rights through
patents, copyrights and trademarks. These property rights
allow the holder to exercise a monopoly on the use of the
item for a specified period.

By restricting imitation and duplication, monopoly power

is conferred, but the social costs of monopoly power may
be offset by the social benefits of higher levels of creative
activity encouraged by the monopoly earnings.
The Role of Creative Thinking
• Creativity
– The generation of ideas that result in the improved
efficiency or effectiveness of a system.
• Two important aspects of creativity exist:
– Process
• The process is goal oriented; it is designed to attain a
solution to a problem.
– People
• The resources that determine the solution.
Two Approaches to Creative Problem Solving

Adaptor Innovator
Employs a disciplined, precise, Approaches tasks from unusual angles
methodical approach
Is concerned with solving, rather Discovers problems and avenues of
than finding, problems solutions
Attempts to refine current practices Questions basic assumptions related
to current practices
Tends to be means oriented Has little regard for means; is more
interested in ends
Is capable of extended detail work Has little tolerance for routine work
Is sensitive to group cohesion and Has little or no need for consensus;
cooperation often is insensitive to others
 Innovation and the Entrepreneur
• Innovation:
– Is the process by which entrepreneurs convert
opportunities into marketable ideas.
– Is a combination of the vision to create a good idea
and the perseverance and dedication to remain
with the concept through implementation.
– Is a key function in the entrepreneurial process.
– Is the specific function of entrepreneurship.
 The Innovation Process
Sources of Innovation
Types of Innovation – Unexpected occurrences
a. Invention – Incongruities
b. Extension – Process needs
– Industry and market
c. Duplication changes
d. Synthesis – Demographic changes
– Perceptual changes
– Knowledge-based
concepts
•Type
Type Description Examples

•Description
Invention Totally new product, service,
or process
Wright brothers—airplane
Thomas Edison—light bulb
Alexander Graham Bell—
•Examples telephone

Extension New use or different Ray Kroc—McDonald’s

application of an already Mark Zuckerberg—Facebook
existing product, service, Barry Sternlicht—Starwood
or process Hotels & Resorts

Duplication Creative replication of an Wal-Mart—department stores

existing concept Gateway—personal
computers
Pizza Hut—pizza parlor

Synthesis Combination of existing Fred Smith—Fed Ex

concepts and factors into a Howard Schultz—Starbucks
new formulation or use
 Major Innovation Myths
Myth 1: Innovation is planned and predictable
Myth 2: Technical specifications should be
thoroughly prepared
Myth 3: Creativity relies on dreams and blue-
sky ideas
Myth 4: Big projects will develop better
innovations than smaller ones
Myth 5: Technology is the driving force of
innovation success
 Principles of Innovation
• Be action oriented.
• Make the product, process, or service simple and understandable.
• Make the product, process, or service customer-based.
• Start small.
• Aim high.
• Try/test/revise.
• Learn from failures
• Follow a milestone schedule.
• Reward heroic activity.
• Work, work, work.