3. Evolution of Business Opportunity
Content
EVALUATION OF BUSINESS OPPORTUNITY THROUGH THRO UGH CREA CREAT TIVE AND INNOVA INN OVAT TIVE ID IDEAS EAS
1. Introduction Introduction 2. The process of Identifying, Evaluating and Selecting a Business Opportunity
i. Identifying The Needs and Wants of Customers ii. Environmental Scanning and Evaluation of Self and the Community iii. Screening of Business Opportunity iv. Selecting a business opportunity and preparing a business plan 3. Innovation
1. I'T(O)*+TIO' 1. %hen a product is a#read& a!a"#a'#e in the #ar$et, BUT doe %ot fu#f"# fully the de#ands and preferences of the custo#ers.
due to lo" &uality, poor perfor#ance, not user friendly, unreasonaly priced, difficult to get or has uni#pressive features
A usiness opportunity is said to e!ist "hen there is room to offer a product or er!"ce in a particular #ar$et "hich fu#f"# cutomer$ dema%d and prefere%ce.
2. %hen the custo#ers re&uire a product that can help to solve their prole#s, for instance, a product that can speed up the process of tapping ruer, a li&uid that shines cars "ithout #uch effort or a co#puter soft"are that e!pedites office "or$.
Every usiness starts "ith an opportunity that can e identified or ta$en advantage of "ithin the current environ#ent.
A onestop service centre
CAR BUSINESS
A car accessory shop
Tyre shop A "or$shop
2. The process of Identifying, Evaluating and Selecting a Business Opportunity
Step I Identifying the needs and !ants of customers Step II Scanning the environment and evaluating of self and the community Step III Screening of business opportunity Step I" Selecting a business opportunity and preparing a business plan
Step I
Identifying The 'eeds and %ants Of +usto#ers
The various hu#an needs and "ants can e categorised into products and services.
PRODUCT
A product is so#ething that possesses a physical for# that is re&uired to fulfil hu#an "ants directly or indirectly.
SERVICES
A service does not possess a physical for# ut has the aility to fulfil a custo#ers "ants.
-otorcycles, radios, oo$s, pens, etc
/air stylist, private doctors, cleaners, educationist, etc
Step II
Environ#ent Scanning and Evaluation of Self and the +o##unity
#. Environmental Scanning Environmental scanning can lead to an idea that can be converted into a business opportunity There are t!o approaches in scanning the environment. 1. Scan the environment from the macro and micro perspectives.
2. Scan the environment from the other factors.
$. Scan the environment from the macro and micro perspectives. FORESTRY -0eneer ly"ood -ogging -urniture -Sa"n ti#er
POULTRY -oultry far#ing -rocessing -%holesale4Supplies
AGRICULTURAL SECTOR
FISHING -ishing e&uip#ent -)eepSea fishing -ish processing -%holesales4)istriution
PLANTATION -+learing plantation -lanting -rocessing -%holesales4Supplies
. Scan the environment from the other factors.
#. Structure of the population% income and tastes B. Study on import and e&port data C. Study on local resources and technological brea'through (. Industrial lin'ages E. (evelopment pro)ects by the public and private sector *. Searching for business opportunities in the local and foreign ne!spapers and maga+ines as !ell as on the internet ,. The study of local social problems -. Ne! government policies and regulations
B. Self #ssessment/Evaluation Identifying business opportunities by seeing !hat is available in oneself. A. E!perience (elated to for#er career 5engineer, fashion design lecturer, B. 6no"ledge and s$ill 6no"ledge to construct a uilding 5contractor7 +. inancial situation inancial aility "ill deter#ine the success of the usiness ). Interest (elated to entrepreneurs interest E. 'et"or$ing politicians, top ran$ing govern#ent officer, an$, insurance, etc..
C. Community #ssessment/Services Evaluate the norms of the community.
•
•
•
Business opportunities need to be coordinated !ith the values or norms of the community in !hich the business operation is going to be implemented. It is important to ensure that a potential business does not go against the values or norms of the local community.
Eg. 0# four1digit business outlet is considered a pro2table business opportunity and legal3. -o!ever% it is against the values of the 4alay community !ho are 4uslims. Eg. # poultry farm located in a residential area
Step III
Screening of Business Opportunities #fter scanning the environment% evaluating oneself and the norm of community% the entrepreneur may end up !ith t!o or more interesting business opportunities that need to be developed. -OWE"E5% it is BEST TO SE6ECT only ONE B7SINESS because it !ill be di8cult to implement various business pro)ects at the same time. T-E5E*O5E% the process of SC5EENIN, B7SINESS O99O5T7NITIES !ill help the entrepreneur to select a business opportunity. This process involves four factors
$. 6egality 4a'e sure that the business opportunity is 6E,#6 Eg. Business !hich involves the buying and selling of imitation "C(s or stolen products is I66E,#6.
. 4onopolistic 9o!er and 6evel of Competition Select a business opportunity !hich is not monopolised by any body or :uarter. It !ill pose many problems% such as danger of sabotage and the di8culty of penetrating a controlled mar'et.
;. Capital re:uirements The business to be implemented must be appropriate for the 2nancial resources available to ensure NO 2nancial problems after the business has started. <. 5is's 5is' is something that is uncertain and is related to success and failure. Entrepreneur must identify the ris's he/she is going to encounter and ta'e into consideration the percentage of success and failure.
There are three categories of business ris's. $. 5is's that can be transferred to another party. 0Eg. Insurance3 . 5is's that can be controlled by a entrepreneur 0Eg. labour turnover% product :uality% machine brea'do!n3 ;. 5is's that cannot be controlled by a entrepreneur 0Eg. Economic do!nturn% natural disasters3
Step IV
Selecting A Business Opportunity and reparing Business lan
#fter screening the various business opportunities !e have to end up !ith only ONE B7SINESS O99O5T7NIT= that needs to go through the ne&t step. W-ET-E5 this business can be implemented of not% it depends on a comprehensive study of the various business functions of 4#5>ETIN,% #(4INIST5#TION% O9E5#TION % *IN#NCE and others.
I''O0ATIO' Every organization—not just business— needs one core competence: innovation. - Peter F. Drucker Introducing so#ething ne" or doing so#ething in a ne" "ay. To ta$e an idea fro# concept to reali8ation and i#prove usiness perfor#ance. +an e a ne" product, a ne" process, or a ne" "ay of doing usiness.
FOR( OF INNOVATION
t c u d o r 9 s e c o r 9 t c u d o r 9 s s s e c o r 9 The Ps o! innovation
9osition 9osition
9aradig 9aradig m m
Product innovation
+hanges in the things 5products4services7 "hich an organi8ation offers.
E!a#ple9 a ne" design of car, a ne" insurance pac$age.
Process innovation
+hanges in the "ays in "hich things 5products4 services7 are created and delivered:
E!a#ple9 change in #anufacturing #ethods and e&uip#ent used to produce the car
Position innovation
+hanges in the conte!t in products4services are introduced
"hich
the
E!a#ple9 ;ohnson < ;ohnson change the product positioning not =ust for aies ut also to adult.
Paradigm innovation
%here #a=or shifts in thin$ing cause change in the organi8ation.
It concerns the change in the "ay so#ething is done in the organi8ation.
E!a#ple9 the shift to lo"cost airlines, shift to go green policies.
THANK YOU
1. Introduction Introduction 2. The process of Identifying, Evaluating and Selecting a Business Opportunity
i. Identifying The Needs and Wants of Customers ii. Environmental Scanning and Evaluation of Self and the Community iii. Screening of Business Opportunity iv. Selecting a business opportunity and preparing a business plan 3. Innovation
1. I'T(O)*+TIO' 1. %hen a product is a#read& a!a"#a'#e in the #ar$et, BUT doe %ot fu#f"# fully the de#ands and preferences of the custo#ers.
due to lo" &uality, poor perfor#ance, not user friendly, unreasonaly priced, difficult to get or has uni#pressive features
A usiness opportunity is said to e!ist "hen there is room to offer a product or er!"ce in a particular #ar$et "hich fu#f"# cutomer$ dema%d and prefere%ce.
2. %hen the custo#ers re&uire a product that can help to solve their prole#s, for instance, a product that can speed up the process of tapping ruer, a li&uid that shines cars "ithout #uch effort or a co#puter soft"are that e!pedites office "or$.
Every usiness starts "ith an opportunity that can e identified or ta$en advantage of "ithin the current environ#ent.
A onestop service centre
CAR BUSINESS
A car accessory shop
Tyre shop A "or$shop
2. The process of Identifying, Evaluating and Selecting a Business Opportunity
Step I Identifying the needs and !ants of customers Step II Scanning the environment and evaluating of self and the community Step III Screening of business opportunity Step I" Selecting a business opportunity and preparing a business plan
Step I
Identifying The 'eeds and %ants Of +usto#ers
The various hu#an needs and "ants can e categorised into products and services.
PRODUCT
A product is so#ething that possesses a physical for# that is re&uired to fulfil hu#an "ants directly or indirectly.
SERVICES
A service does not possess a physical for# ut has the aility to fulfil a custo#ers "ants.
-otorcycles, radios, oo$s, pens, etc
/air stylist, private doctors, cleaners, educationist, etc
Step II
Environ#ent Scanning and Evaluation of Self and the +o##unity
#. Environmental Scanning Environmental scanning can lead to an idea that can be converted into a business opportunity There are t!o approaches in scanning the environment. 1. Scan the environment from the macro and micro perspectives.
2. Scan the environment from the other factors.
$. Scan the environment from the macro and micro perspectives. FORESTRY -0eneer ly"ood -ogging -urniture -Sa"n ti#er
POULTRY -oultry far#ing -rocessing -%holesale4Supplies
AGRICULTURAL SECTOR
FISHING -ishing e&uip#ent -)eepSea fishing -ish processing -%holesales4)istriution
PLANTATION -+learing plantation -lanting -rocessing -%holesales4Supplies
. Scan the environment from the other factors.
#. Structure of the population% income and tastes B. Study on import and e&port data C. Study on local resources and technological brea'through (. Industrial lin'ages E. (evelopment pro)ects by the public and private sector *. Searching for business opportunities in the local and foreign ne!spapers and maga+ines as !ell as on the internet ,. The study of local social problems -. Ne! government policies and regulations
B. Self #ssessment/Evaluation Identifying business opportunities by seeing !hat is available in oneself. A. E!perience (elated to for#er career 5engineer, fashion design lecturer, B. 6no"ledge and s$ill 6no"ledge to construct a uilding 5contractor7 +. inancial situation inancial aility "ill deter#ine the success of the usiness ). Interest (elated to entrepreneurs interest E. 'et"or$ing politicians, top ran$ing govern#ent officer, an$, insurance, etc..
C. Community #ssessment/Services Evaluate the norms of the community.
•
•
•
Business opportunities need to be coordinated !ith the values or norms of the community in !hich the business operation is going to be implemented. It is important to ensure that a potential business does not go against the values or norms of the local community.
Eg. 0# four1digit business outlet is considered a pro2table business opportunity and legal3. -o!ever% it is against the values of the 4alay community !ho are 4uslims. Eg. # poultry farm located in a residential area
Step III
Screening of Business Opportunities #fter scanning the environment% evaluating oneself and the norm of community% the entrepreneur may end up !ith t!o or more interesting business opportunities that need to be developed. -OWE"E5% it is BEST TO SE6ECT only ONE B7SINESS because it !ill be di8cult to implement various business pro)ects at the same time. T-E5E*O5E% the process of SC5EENIN, B7SINESS O99O5T7NITIES !ill help the entrepreneur to select a business opportunity. This process involves four factors
$. 6egality 4a'e sure that the business opportunity is 6E,#6 Eg. Business !hich involves the buying and selling of imitation "C(s or stolen products is I66E,#6.
. 4onopolistic 9o!er and 6evel of Competition Select a business opportunity !hich is not monopolised by any body or :uarter. It !ill pose many problems% such as danger of sabotage and the di8culty of penetrating a controlled mar'et.
;. Capital re:uirements The business to be implemented must be appropriate for the 2nancial resources available to ensure NO 2nancial problems after the business has started. <. 5is's 5is' is something that is uncertain and is related to success and failure. Entrepreneur must identify the ris's he/she is going to encounter and ta'e into consideration the percentage of success and failure.
There are three categories of business ris's. $. 5is's that can be transferred to another party. 0Eg. Insurance3 . 5is's that can be controlled by a entrepreneur 0Eg. labour turnover% product :uality% machine brea'do!n3 ;. 5is's that cannot be controlled by a entrepreneur 0Eg. Economic do!nturn% natural disasters3
Step IV
Selecting A Business Opportunity and reparing Business lan
#fter screening the various business opportunities !e have to end up !ith only ONE B7SINESS O99O5T7NIT= that needs to go through the ne&t step. W-ET-E5 this business can be implemented of not% it depends on a comprehensive study of the various business functions of 4#5>ETIN,% #(4INIST5#TION% O9E5#TION % *IN#NCE and others.
I''O0ATIO' Every organization—not just business— needs one core competence: innovation. - Peter F. Drucker Introducing so#ething ne" or doing so#ething in a ne" "ay. To ta$e an idea fro# concept to reali8ation and i#prove usiness perfor#ance. +an e a ne" product, a ne" process, or a ne" "ay of doing usiness.
FOR( OF INNOVATION
t c u d o r 9 s e c o r 9 t c u d o r 9 s s s e c o r 9 The Ps o! innovation
9osition 9osition
9aradig 9aradig m m
Product innovation
+hanges in the things 5products4services7 "hich an organi8ation offers.
E!a#ple9 a ne" design of car, a ne" insurance pac$age.
Process innovation
+hanges in the "ays in "hich things 5products4 services7 are created and delivered:
E!a#ple9 change in #anufacturing #ethods and e&uip#ent used to produce the car
Position innovation
+hanges in the conte!t in products4services are introduced
"hich
the
E!a#ple9 ;ohnson < ;ohnson change the product positioning not =ust for aies ut also to adult.
Paradigm innovation
%here #a=or shifts in thin$ing cause change in the organi8ation.
It concerns the change in the "ay so#ething is done in the organi8ation.
E!a#ple9 the shift to lo"cost airlines, shift to go green policies.
THANK YOU
