2025/12/10
LESSON 3 -
THE IDENTIFICATION AND
DEVELOPMENT OF BUSINESS IDEAS
Business Management Fundamentals 1A
BSM1501
List and explain
the three stages
LEARNING OUTCOME in creating an
enterprise
1
2025/12/10
THREE STAGES IN CREATING AN ENTERPRISE
Idea stage
Information
Ideas
IDEA Test feasibility
STAGE
Feasible small business plan Not feasible idea
THREE STAGES IN CREATING AN ENTERPRISE
Idea stage
• Definition: Identifying and generating feasible business ideas.
• Key Points:
• Entrepreneur cultivates creativity.
• Opportunities are identified and explored.
• Various business ideas are generated and refined.
• A suitable idea is chosen for further evaluation.
• Feasibility of the chosen idea is tested.
2
2025/12/10
THREE STAGES IN CREATING AN ENTERPRISE
Planning stage
Test viability
PLANNING
Viable small business plan Not viable business plan
STAGE
Business plan
THREE STAGES IN CREATING AN ENTERPRISE
Planning stage
• Definition: Investigating the profitable exploitation of the idea and drawing up a business plan.
• Key Points:
• Viability of the idea is thoroughly tested.
• Market research is conducted to understand profit potential.
• Product offerings are defined, and target market is identified.
• Costs, selling price, and profit potential are calculated.
• A comprehensive business plan is developed if the idea is viable.
3
2025/12/10
THREE STAGES IN CREATING AN ENTERPRISE
Implementation stage
Implementation
IMPLEMENTATION
STAGE
THREE STAGES IN CREATING AN ENTERPRISE
Implementation stage
• Definition: Put the idea into practice by starting the enterprise.
• Key Points:
• Necessary legal processes for starting a business are completed.
• Legal requirements are met to ensure compliance.
• The eight functions of the enterprise are put into action.
• Actual implementation of the business idea takes place.
4
2025/12/10
Define
“creativity”
LEARNING OUTCOME
CULTIVATING A CREATIVE ATTITUDE
Definition of creativity
• Creativity involves seeing things differently and generating new ideas.
• Consider a topic from various angles for fresh perspectives.
• It's about thinking differently about familiar things.
• Creativity is the ability to:
• Generate new possibilities.
• Identify alternatives.
• Come up with something new.
10
10
5
2025/12/10
Distinguish between
divergent thinking
and convergent
thinking, and
LEARNING OUTCOME explain why both
these abilities are
essential for
creative output
11
11
CULTIVATING A CREATIVE ATTITUDE
Divergent and convergent thinking
Aspect Divergent Thinking Convergent Thinking
Definition Generate original, diverse ideas Evaluate and choose best idea
Emphasis Novelty and creativity Appropriateness and feasibility
Dominance Right-brain dominant Left-brain dominant
Approach Perceptual, imaginative Analytical, critical
Process Brainstorming, idea generation Idea selection, decision-making
Purpose Expanding possibilities Narrowing down options
Example Brainstorming sessions Selecting the most viable idea
Outcome Wide range of potential ideas Refined, well-considered choice
Importance Essential for creative products Ensures practical and viable idea
Key Skill "Thinking outside the box" Rational decision-making
Focus
12 Exploring various angles Identifying the best solution
12
6
2025/12/10
CULTIVATING A CREATIVE ATTITUDE
Balancing divergent and convergent thinking
• Divergent thinking sparks innovation and unique concepts.
• Convergent thinking refines ideas for practical implementation.
• Successful entrepreneurs master both divergent and convergent thinking.
• Creativity benefits from a balanced approach.
• Balanced approach maximizes creative output's impact and relevance.
• Combine imaginative idea generation with rational evaluation.
13
13
List and explain
the five methods
LEARNING OUTCOME that can be used
to cultivate a
creative attitude
14
14
7
2025/12/10
CULTIVATING A CREATIVE ATTITUDE
Methods for cultivating a creative attitude
• Actively Seek Ideas
• Judge what you read or observe for potential ideas.
• Train your mind to spot idea-generating opportunities.
• Write Down Your Ideas
• Record every idea, even if it seems insignificant.
• Capturing ideas fosters creative thinking and prevents loss.
• View From Another Perspective
• Step into someone else's shoes for fresh insights.
• Gain new viewpoints and expand your thinking.
15
15
CULTIVATING A CREATIVE ATTITUDE
Methods for cultivating a creative attitude
• Break Your Routine
• Try novel experiences to stimulate your thoughts.
• Challenge your comfort zone for renewed creativity.
• Explore Grey Areas
• Move beyond black-and-white thinking.
• Search for solutions and possibilities in-between.
• Adjust Your Mindset
• Prepare your mind for creative thinking.
• Openness to new ideas enhances your creativity.
16
16
8
2025/12/10
CULTIVATING A CREATIVE ATTITUDE
Techniques to enhance team creativity
• Brain Sketching
• Visualize ideas through sketching and drawing.
• Encourages visual thinking and creative expression.
• Brainstorming
• Group discussion for idea generation.
• Diverse perspectives lead to innovative concepts.
• Card Storyboards
• Arrange ideas using cards or sticky notes.
• Organizes thoughts and aids collaborative creativity.
• Pin Cards
• Pinpoint key ideas on a board for focus.
• Clarifies concepts and highlights important aspects.
17
17
CULTIVATING A CREATIVE ATTITUDE
Techniques to enhance team creativity
• Superheroes
• Imagine solving challenges as superheroes.
• Sparks imaginative problem-solving and creativity.
• Storyboarding
• Visualize ideas in a sequence.
• Helps plan and communicate complex concepts.
• Wishing
• Imagine ideal scenarios without constraints.
• Unleashes aspirational and innovative thinking.
• Enhancing Team Creativity
• Embrace these techniques for powerful team collaboration.
• Combined creativity leads to breakthrough solutions.
18
18
9
2025/12/10
List and discuss
the five
approaches that
LEARNING OUTCOME can be followed
to generate
business ideas
19
19
GENERATING BUSINESS IDEAS Skills,
Expertise,
Five approaches for generating business aptitudes
ideas
• Approach 1 - Entrepreneur's Other
Skills, Expertise, and Aptitudes Common
• Skills sources needs
• Refers to learnable manual abilities.
• Example: Carpenter using woodworking skills to start a furniture business.
• Expertise
• Based on acquired knowledge.
• Gained through formal education and/or experience.
• Example: A marketing expert launching a consulting firm.
• Aptitudes Everyday Existing
• Inborn talents or natural abilities.
activities problems
• Example: Artist starting a custom art business.
20
20
10
2025/12/10
GENERATING BUSINESS IDEAS
Five approaches for generating business ideas
• Approach 2 - Common Needs
• Identify shared needs among a group of people.
• Develop a product/service to meet the identified need.
• Example: Creating a meal delivery service for busy professionals.
• Approach 3 - Existing Problems
• List personal or observed problems.
• Innovate solutions to address these problems.
• Example: Developing a smartphone app to organise daily tasks.
21
21
GENERATING BUSINESS IDEAS
Five approaches for generating business ideas
• Approach 4 - Everyday Activities
• Observe routines and activities in daily life.
• Identify areas for improvement or innovation.
• Example: Creating a mobile app for language learning during commute.
• Approach 5 - Other Sources
• Utilise external sources for inspiration.
• Yellow Pages, business publications, inventors’ associations, etc.
• Example: Transforming expired patents into new products.
22
22
11
2025/12/10
GENERATING BUSINESS IDEAS
Five approaches for generating business ideas
• Why These Approaches Matter
• Diversity of approaches widens idea pool.
• Each approach taps into different aspects of entrepreneurship.
• Offers opportunities for innovation across various industries.
• Applying the Approaches
• Embrace these approaches as a creative exercise.
• Mix and match approaches for comprehensive idea generation.
• Transform ideas into viable business ventures.
23
23
Explain the
purpose of using
LEARNING OUTCOME a bow-tie
diagram
24
24
12
2025/12/10
THE DEVELOPMENT AND EVALUATION OF BUSINESS IDEAS
Development of business ideas
• Not all creative ideas are feasible for business.
• A single idea or a combination may become an enterprise.
• Clarity on key aspects is crucial for evaluation.
• Before evaluation of the business idea
• Key question: What are the main business activities?
• Options include:
• Manufacturing a product
• Providing a service
• Selling other people's products/services
• Key question: Who are your consumers?
• Two categories:
• Individuals
• Organizations
25
25
THE DEVELOPMENT AND EVALUATION OF BUSINESS IDEAS
Bow-tie diagram
• Illustrates potential business activities and consumers.
• Aids in developing business ideas effectively.
• Provides six options for business development:
• Manufacturing products for individuals
• Providing services to individuals
• Selling products/services to individuals
• Manufacturing products for organizations
• Providing services to organisations
• Selling products/services to organisations
26
26
13
2025/12/10
THE DEVELOPMENT AND EVALUATION OF BUSINESS IDEAS
Bow-tie diagram
• Using the Bow-Tie Diagram
• Develop your business idea using the diagram.
• Define the essence of your idea.
• Explore possible idea combinations.
• Consider taking new directions with your idea.
27
27
THE DEVELOPMENT AND EVALUATION OF BUSINESS IDEAS
Bow-tie diagram
INDIVIDUALS ORGANISATIONS
Products Products
Services Services
IDEA
Selling for others Selling for others
28
28
14
2025/12/10
THE DEVELOPMENT AND EVALUATION OF BUSINESS IDEAS
Evaluation of business ideas
• Understanding Evaluation
• Prior to evaluation, understand the core idea of each concept.
• Clarity on two crucial aspects:
• Chief activities of the business.
• Manufacturing a product
• Providing a service
• Selling other people's products/services
• Target customers:
• Your customers can be individuals and/or organizations.
• Clear identification of your target audience is essential
29
29
Explain what a
feasibility study
LEARNING OUTCOME is
30
30
15
2025/12/10
FEASIBILITY OF BUSINESS IDEAS
What is feasibility?
• Definition of a Feasibility Study
• An examination of idea potential for enterprise conversion.
• Determines practical possibility of transforming the idea.
• Focus of a Feasibility Study
• Evaluates the entrepreneur's ability to convert the idea.
• Matches skills, expertise, and aptitudes with the idea.
• Purpose of Feasibility Study
• Determine potential of idea for enterprise conversion.
• Assess the entrepreneur's capability to execute the idea.
31
31
List the four
questions to
LEARNING OUTCOME answer, when
conducting a
feasibility study
32
32
16
2025/12/10
FEASIBILITY OF BUSINESS IDEAS
Conducting a feasibility study
• Four Key Questions:
1. Do I want to pursue this idea?
2. Is there a market for my idea?
3. Can I meet consumer needs?
4. Can I effectively communicate the idea to consumers?
33
33
Explain the
difference
between a
LEARNING OUTCOME feasibility study
and a viability
study
34
34
17
2025/12/10
FEASIBILITY OF BUSINESS IDEAS
Difference between feasibility and viability
35
35
BUSINESS ENVIRONMENT
Internal vs External environments
Internal Environment (Micro- External Environment (Market and
Aspect Environment) Macro-Environments)
Factors within the enterprise's Factors beyond the enterprise's
Definition
control control
Directly influenced by the Impacts business decisions and
Characteristics
enterprise strategies
Organisational culture, resources, Market trends, economic conditions,
Examples
structure political factors
Strengths and weaknesses of the Opportunities and threats from the
Focus
organisation market and society
Managed and modified by the
Influence Constantly changing and dynamic
organisation
36
36
18
2025/12/10
"Success in the dynamic world of business lies not only in
what you control, but also in how adeptly you navigate
“QUOTE” the ever-changing currents of the market, the environment,
and the aspirations of consumers. Remember, a well-
prepared enterprise embraces external influences and
turns challenges into opportunities."
37
19