SSP 24: Entrepreneurial Mind

Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

OBJECTIVE
1. Discuss entrepreneurial activities in search of business opportunities
2. Describe the concept of ideation, innovation and creativity
3. Discuss the factors to consider in evaluating the business potential of an idea
INTRODUCTION
There are many business opportunities for individuals with creative minds. Every business starts with an
idea, and it is often said that creativity—combined with innovation and the ability to introduce something
new to the market—creates the difference between a traditional businessman and an entrepreneur.
An entrepreneur may choose to start either a small or a large business, but it is important to follow a
systematic process of identifying and evaluating ideas. These ideas can later be transformed into profitable
business ventures. Careful evaluation helps ensure that the chosen idea is practical, sustainable, and aligned
with available resources and market needs.

DISCUSSION
The Factors to Consider in Evaluating the Business Potential of an Idea
In selecting a business, options should not be based on luck and immature thinking, but on a
thorough evaluation and systematic process. Start by developing long and short lists of potential business
opportunities. Likewise, the resources, skills, and technology available in the community are to be evaluated
if these are not fully or efficiently utilized.
In discovering business opportunities, the following factors on resources have to be evaluated:
1. Markets - This refers to the number of prospective buyers, competitors, the price, and the quality of
goods and services that must be analyzed. Business opportunities exist in areas where consumer
satisfaction is weak or incomplete.
2. Individual Interests - The business interest of individuals should match business opportunities.
For example, if one is a good cook, he could venture into the food business. Some is true when one is
good in arts and crafts, he should engage himself in business focusing on arts and crafts
3. Capital - This serves as the fuel that keeps the business operating. The availability of funds should
fit the type of business to organize.
4. Skills - The entrepreneur should have the proper skills in the business he is going to undertake.
5. Suppliers of inputs - It is important that there are steady suppliers of raw materials and other inputs
to the business.
6. Manpower - The success of any business also depends on the efficiency of its employees.

This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

7. Technology - Entrepreneurs should be aware of the presence of technology to improve their products
or services or introduce new innovations in the market.
Among the productive resources, people are the most important because they are the ones who organizes and
manage the other productive resources and such as money, materials, machine and manpower.

Other opportunity-seeking process that can guide a prospective entrepreneur as to what kind of business to
establish are as follows:
1. Look at other successful business/ entrepreneurs – looking up at other entrepreneurs as a role
model could be an aspiration, by doing what they have done or do it better.
2. Respond to a problem area – the solution to a problem might be transformed into business
venture.
3. Home-based business option – these must not be taken for granted, for there are some big
businesses that started as a small business at home
4. Linkage of resources – the entrepreneur can produce his own input instead of buying them.
The best way to evaluate business opportunity is through market research, which is defined as the study of
all problems in marketing a product. The steps in market research are:
 Defining the problem
 Making preliminary investigations
 Planning the research
 Gathering the data
 Analyzing the data
 Reaching a conclusion
 Implementation and evaluating decisions
Location of the business is a key factor in business success. In selecting a location, the population, income,
competitor, government policies, peace and order, and others are being considered. This requires a market
survey.

This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

To be able to able to translate business opportunities into profits, the SWOT (Strength, Weakness,
Opportunity, and Threat) Analysis is applied. These are tools for evaluating the strengths, weaknesses,
opportunities, and threats associated with a particular product or service.

The following are the description of the various stages of a product life cycle. According to Fajardo,
products have their own life cycle. It is composed of four stages:

 Introduction – if consumer awareness and acceptance of product are low, launch through the use of
marketing activities, which make the profit low due to cost of development and marketing activities
 Growth – to meet the growing demand, product distribution is expanded. Sales rise rapidly as
products become popular

This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

 Maturity – sales are still rising, but rate increase has declined. At the latter part, a sales reaches its
peak, while profit begins to fall
 Decline – there is a sharp fall in sales volume, while profit curve becomes almost flat or horizontal.
There is also decline in number of competitors. The only survivor is those who specialize in
marketing the product. Once product is no longer profitable, it is eliminated from the market.
Venturing into a business project demands a timely and clear decision as to which area or business concern
to deal with. In selection process, one must begin with choosing or focusing on a particular business by
category or selection.
1. The service-based business – common examples of service-based business are consultancy,
barber shops, repair shops, beauty parlors, care giving, design works, rendering professional
services, such as engineers, dentistry, medical doctor, and others where there is no need to
manufacture something.
2. Trading or product-based business – this is a buy and sell transaction that can happen in your
storehouse, showroom, or any other structureless environment. selling involves a lot of customer
contact and requires a great deal of persistence on the entrepreneurs’ part. An example of this is
putting up a grocery store, bakery products, or general construction materials.
3. Manufacturing business – this is a manufacturing or production – based business by creating a
product. Manufacturing can be as simple as creating hand painted T-shirts or ceramic vases and
now, the most popular is candle making, which can be done in your home
4. Licenses business opportunities – if you find some difficulties in launching a product or service,
it is a good idea to look for licensed business opportunities. Franchising is a business format
somewhat very similar to licensed business operations
5. Distributorship – this is where an independent entrepreneur, company, or individual enters into an
agreement or contract to offer, sell, or distribute a particular product, but is not entitled to use the
manufacturer's trade name as part of its own trade name. in our country, distributor represents
foreign companies who can sell products to dealers strategically located all over the country.
6. Wholesalers – these sell the product of manufacturers or producers to retailers and other
distributors who have direct dealings with the end users or customers
7. Rack jobber – this involves an agent or buyer entering an agreement with a parent company to
market its goods to various store by means of strategically located racks.
8. Subcontracting – this is a familiar form of business format in the garments sector, as well as the
shoe industry. This involves signing up an arrangement with major producer to complete a set of
product components on a pre-agreed price.
This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

9. Vending machines routes –These are placed in various places or locations. The entrepreneur
needs to have substantial capital outlay as he had to pay for vending machine, including the
stocks to be vended.
IDEATION
The beginning of a business endeavor is ideation. The best source of ideas are the consumer or the market in
general, since they are the ones who are in need for a certain production or service.
For a creative person ideas are in him in his mind, but for those deprived with creative thinking, they get
ideas through reading books, talking to someone with creative thinking.
Ideas that are worth a business should be the one that has a market now and in the future. This could be a
product, a service system and the like which could fall in any of the following categories:
a. Needs/wants drive
b. Time-saving drives
c. Money savings
d. Unique or incorporating strong competitive advantages
e. Link to personal interest, preferably passion
The more idea a person produces, the more original and the better-quality ideas one will find among them.
When you come across an idea you should put it in writing.
The most common way of developing ideas is as follows:
 Recognizing the needs – develop an idea or product that can satisfy a need and respond to the need
by establishing a business concern
 Improving an existing product – the result of consumer dissatisfaction to the existing product could
open the door to introduce innovations or improvements
 Recognize trends – entrepreneurs should be able to recognize the opportunity to develop a product
and set trends that can make them leading entrepreneurs
 Be aware of everything – there is no other way to about what is happening around you but to
research and read
 Questions and assumptions – anybody can question relevance or quality of any product or services,
provided, that there is an effort to improve the product
 Naming it first, then develop it – if you have the idea study it and develop it to something that is
worth a business
A wrong choice of idea could be the cause of business failure, so ideas need to be evaluated if it can be
profit potential. The following are some tips in evaluating ideas:

This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

a. Do not let your idea follow money, let money follow your ideas. If the idea is clear and viable, there
should be clear options for the business out of the idea
b. See yourself as a problem solver – ideas should be solution to an existing problem of the consumer
or the market in general
c. Use research as a weapon against failure – this is an important fact in decision-making process; most
business failed because of lack of information
d. Make sure your idea has longevity – an idea that is worth pursuing into a business is one which has a
long-term purpose and not only a fad.
e. Take risk on your ideas – venture into a business by using your own ideas
f. Test your idea against the past, present, and future – the market needs and demands will not be far
from what is happening in the past, so it is better to get information about the past, present, and
future
g. Know the idiosyncrasies of your market – know the needs of your market and all the factors that
affect the buying process.

Ways in protecting your ideas:

a. Confidentiality agreements – it specifically provides that a signer will not share the idea to anyone
this is a typical agreement or contract where one should ask advice to a patent’s attorney or those
with experience and expertise in the intellectual property rights.
b. Patents – these gives the inventor exclusive legal rights to exclude anyone else from manufacturing,
selling, importing, or using an invention during the life of the patent. The three general
classifications are:
a. Design
b. Utility and
c. Plant patents
c. Trademarks – this is a word, name, symbol, or device used by manufacturers on merchants to
identify their goods and distinguish them form others sold in the market
d. Copyrights – a copyright protects the creative works of composers, authors/ writers, artists, and
others. This is the easiest form of protection for intellectual property

ENTREPRENEURIAL CREATIVITY
Creativity, innovation, and entrepreneurs are inseparable. Creativity is an essential parts of innovativeness,
the starting point of a process, which is skillfully managed, and brings an idea into innovation. It is
This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

considered as a characteristic that is innate or inherent to every individual, but social environment can
influence both the level and frequency of creative behavior.
ENVIRONMENTAL STIMULANTS TO CREATIVITY
a. Freedom – sense of control over one’s work ideas
b. Good project management – a manger serves as a good role model
c. Sufficient resources – access to necessary resources
d. Encouragement – management enthusiasm for new ideas
e. Various organizational characteristics – a mechanism for considering new ideas
f. Recognition – a general sense that creative work will receive appropriate feedback, recognition, and
reward
g. Sufficient time – time to think creatively about problem
h. Challenge – a sense of challenge arising from intriguing nature of the problem itself
i. Pressure – a sense of urgency that is internally generated from competition as a personal sense of
challenge
j. Outside organization – from a general desire to accomplish something important

Environmental Obstacles to creativity

If there is an environment conductive to stimulating creativity, there are also environmental obstacles to
creativity these are the various organizational characteristics:
1. Inappropriate reward system
2. The lack of freedom in deciding what to do or how to accomplish the task
3. Organizational disinterest which result to lack of support, interest, or faith in project
4. Inability of the manager to set clear direction
5. Reluctance of managers and co-workers to change their way of doing things
6. Lack of appropriate facilities, equipment, materials and
7. Time pressure to think creatively about the problem

THE CONCEPT OF INNOVATION

Innovation is doing something different. It could be introducing either something new or different.
Innovativeness is a characteristic of an individual, team, or organization. This is also the capacity to create
ideas and develop them to usable products or services.

This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

Impacts of Innovation
Efforts on innovation must have impact – positive impacts. It must have a positive implication that is
supportive of organizational goals and objectives. The innovative accomplishment exists if the following
happens:
1. Affecting a new policy – creating a change or orientation or direction
2. Finding new opportunities – developing an entirely new product or opening a new market
3. Designing a new structure – changing the formal structure, reorganizing or introducing new a new
structure
4. Devising a fresh method – introducing a new process, procedure, or technology for continued use
Within the organization, the orientation toward innovation must come primarily from the higher level of
management. The elements of innovation orientation are as follows:
a. Value placed on creativity and innovation in general
b. An orientation towards risks
c. A sense of pride in the organization and its members, and the enthusiasm about what they can do;
and
d. An offensive strategy of taking the lead towards the future

SUMMARY
1. Factors in Evaluating a Business Idea
 Market
 Personal interest
 Capital
 Skills
 Suppliers
 Manpower
 Technology
2. Ways of Discovering Business Opportunities
 Learning from successful entrepreneurs
 Solving problems
 Home-based businesses
 Linking resources
3. Market Research and Business Location
 Meaning and steps of market research
This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

 Importance of business location

4. SWOT Analysis
Strengths, Weaknesses, Opportunities, and Threats
5. Product Life Cycle
 Introduction
 Growth
 Maturity
 Decline
6. Types of Business Ventures
 Service
 Trading/Product-based
 Manufacturing
 Franchise/Licensed business
 Distributorship
 Wholesaling
 Rack jobbing
 Subcontracting
 Vending machine business
7. Ideation (Generating Business Ideas)
 Sources of ideas
 Ways of developing ideas
 Characteristics of good business ideas
8. Evaluating and Protecting Business Ideas
 Testing ideas using research
 Patents, trademarks, copyrights, and confidentiality agreements

ACTIVITY
This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.
 SSP 24: Entrepreneurial Mind
Module 3: Search for Business Opportunity, Ideation, Innovation and Creativity

A. SWOT Analysis Worksheet

Using the SWOT analysis, plot the family strengths and weaknesses and the opportunities and threats in
your local community. Write them on a manila paper. Refer to the format below. Afterwards, present your
output in class.

Family Strengths Family Weaknesses

Strengths and Weaknesses 1. 1.

2. 2.

3. 3.
Opportunities in the Local How will you use the How will you overcome
Community family strengths to take the family weaknesses by
1. advantage of the taking advantage of the
2. opportunities in the local opportunities in the local
3. community? community?

Threats in the Local How will you use the How will you minimize the
Community family strengths to avoid or family weaknesses to avoid
1. minimize the threats in the or lessen the threats in the
2. local community? local community?
3.

Name: Section: Date:

B. Identify and describe the three ways in identifying the intended market
C. Name the three basic steps in market positioning.
D. Explain the two basic dimensions in differentiating the product from its competitors
E. Enumerate the criteria to be considered in deciding the attributes or benefits to be attached to the
product.

This module is intended solely for educational purposes. The contents have been compiled and adapted from various academic and instructional
sources. Reproduction, distribution, or transmission of this material, in whole or in part, for commercial purposes is strictly prohibited. Proper
acknowledgment and citation of the original sources must be observed when any portion of this material is used for academic, research, or
instructional purposes.