ENTREPRENEURIAL MIND REVIEWER Myths of Entrepreneurship

Truth #1:
“To be successful entrepreneur is to think outside the  Entrepreneurship is not reserved for startup.
box” Truth #2:
 Entrepreneurs do not have a special set of
Break out from your existing mindset !!! personality traits
• Researcher Saras Sarasvathy, through
1. Break your routine study involving serial entrepreneurs, Sarasvathy
 try listening to new music genre discovered patterns of thinking, a theory she
 Don’t procrastinate calls effectuation.
 Try new routes going to school/work • Serial entrepreneurs – (or Habitual
 Try something different Entrepreneurs) the type of entrepreneurs who
2. READ, READ, READ starts several businesses, whether
 The art of war (sun tzu) simultaneously or one after the other.
 Outliers (malcolm gladwell) • Effectuation – the idea that the future is
 Blue ocean (strategy) unpredictable yet controllable.
3. Inquire Truth #3:
 Do not hesitate to ask  Entrepreneurship can be taught (it is a method
 Validate your results with your “why” that requires practice)
4. Set your goals Truth #4:
 Entrepreneurs are not extreme risktakers
Entrepreneur Truth #5:
 Uses resources to give goods and services to  Entrepreneurs collaborate more than they
gain profit that will be useful also to the compete
economy. Truth #6:
 Someone who plans, organizes and puts  Entrepreneurs act more than they plan
together all the resources required to bring a Truth #7:
new enterprise into existence and to run and  Entrepreneurship is a life skill
manage it on a way on a long term basis.
Are: Evolution of entrepreneurship
 Perceive business opportunities in the • One who undertake a project for a
environment. manufacturer, a master builder- Common
 Take risks to make use of these business French Usage (1600s)
opportunities. • Someone who engages in exchanges for profits;
 Invest his own money or borrows money to use someone who exercises business judgement in
in the business. the face of uncertainty- Richard Cantillon (1755)
 Innovator to make business better, efficient and • The entrepreneur shifts economic resource out
more profitable. of an area of a lower and into n are of higher
 Planner and business decision maker. productivity and greater yield- Jean-Baptiste Say
 Generate profit for business. (1800s)
Are not: • (One who identifies) new combinations
 He is not a person who give or lends money to including the doing of new things or the doing
other. off thing that are already being done on a new
 He is not the person who is hired and paid. way. New combination include: 1. introduction
Reward of being an entrepreneur: of a new good, 2. new method of production, 3.
 Make money opening of new market, 4. new source of
 Be your own boss supply, 5. new organizations- Schumpeter
 Express creativity (1934)
 Gain self-satisfaction • Entrepreneur- An individual or a group who
Risks of being an entrepreneur creates something new- new idea, a new item
 Risk of failure or product, a new institution, a new market, a
 Long hours of hardwork new set of possibilities. (1975-present)
 Unwanted responsibilities Types of Entrepreneurship:
 Different Phases of Entrepreneurs
Corporate Entrepreneurship • Potential Entrepreneurs – individuals who
•Corporate Entrepreneurship – (or Intrapreneurship) is believe they have the capacity and know-how
a process of creating new products, ventures, to start a business without being burdened by
processes, or renewal within the organizations. the fear of failure.
• Typically carried out by employees working in units • Nascent Entrepreneurs – individuals who have
separate from the organization who create and test set up a business they will own or co-own that
innovations that are then assimilated back inside the is less than three months old and has not yet
broader organization. generated wages or salaries for the business
Entrepreneurs Inside owners
• Entrepreneurs inside – the types of • New Business Owners – individuals who are
entrepreneurs who think and act former nascent entrepreneurs and have been
entrepreneurially within organizations. actively involved in a business for over three
• May sound similar to corporate entrepreneurs, and a half years.
but entrepreneurs inside can exist and function • Establish business owners – the people who are
in any type of organization, big or small, still active in business for over three and a half
including government agencies, nonprofits, years.
religious entities, self-organizing entities and • Necessity-based entrepreneurs – individuals
cooperatives. who are pushed into starting their own business
Buying a Franchise because of circumstance such as redundancy,
• Franchise- a type of license purchased by a threat of a job loss, and unemployment.
franchisee from an existing business to allow Republic Act 10679- Youth Entrepreneurship Act
them to trade under the name of that business. Republic Act 10644- Go Negosyo Act
• Royalties- a share of the proceeds of a business
from one party to another. 14 Life work principle of Henry Sy:
Buying Small Business 1. Strive to be a leader in your chosen field.
• The entrepreneur is buying out the existing 2. Be a person of integrity.
owner and taking over operations. 3. Have a long term vision and strategy.
Social Entrepreneurship 4. Focusing means concentrating and prioritizing.
• Social Entrepreneurship- the process of 5. Have great passion to achieve.
sourcing innovative solutions to social and 6. Work hard.
environment problem. 7. Be patient and persevere.
• Benefit Corposation (B-corp)- a form of 8. Recognize opportunity.
organization certified by the non-profit B lab 9. Be optimistic.
that ensure strict standards of social and 10. Be confident.
environmental performance, accountability, 11. Be disciplined.
and transparency are met. 12. Build your organization.
Global Entrepreneurship 13. Make it your mission to provide employment.
• Entrepreneurship is taking off on a global scale 14. Social responsibility is important.
• Global Entrepreneurship Monitor (GEM) – a
global research study founded by Babson Types of Entrepreneurs
College and the London Business School, now
currently conducted by a consortium of Innovators
universities around the world.  In most cases, these entrepreneurs change the
• The GEM study gathers its data according to way people think about and do things. Such
different phases of entrepreneurs entrepreneurs tend to be extremely passionate
• Potential Entrepreneurs and obsessive, deriving their motivation from
• Nascent Entrepreneurs the unique nature of their business idea.
• New Business Owners  Innovative entrepreneurs also find new ways to
• Established Business Owners market their products by choosing product
differentiation strategies that make their
• Necessity-based Entrepreneurs
company stand out from the crowd. And
• Opportunity-based Entrepreneurs
 sometimes it is not just standing out from the  Imitators are the types of entrepreneurs who
crowd but actually creating a new crowd. copy certain business ideas and improve upon
 To say that innovators like Steve Jobs, Larry them.
Page of Google and Microsoft founder Bill Gates  They are always looking for ways to make a
were obsessed with their business would be an particular product better so as to gain an upper
understatement. hand in the market.
Advantages of Being An Innovate Entrepreneur:  Taking an existing idea and refining and
• Get all the glory for the success of the business improving it can be a great way to develop a
(and take all the arrows) business. It certainly does not have as much risk
• Create the rules as the innovator but it might just not be as sexy.
• Face minimal competition during the initial days  Imitators are part innovators and part hustlers
Disadvantages of Being An Innovate Entrepreneur: who don’t stick to the terms set by other people
• You will need a lot of capital to bring a new idea and have a lot of self-confidence.
to life Advantages of Imitators
• Often face resistance from shareholders • Refining a business idea is easier and less
• The timeframe for success is longer stressful
Hustler • You can easily benchmark your performance
 Unlike innovators whose vision is the gas in with the original idea
their engine, hustlers just work harder and are • Can learn and avoid mistakes that were made
willing to get their hands dirty. Hustlers often by the originator
start small and think about effort – as opposed Disadvantages of Imitators
to raising capital to grow their businesses. • Their ideas are always compared to the original
These types of entrepreneurs focus on starting idea
small with the goal of becoming bigger in the • Always have to play catch-up
future. Researcher
 Hustlers are motivated by their dreams and will  For a researcher, there should be no room for
work extremely hard to achieve them. They making mistakes.
tend to be very focused and will get rid of all • Advantages of Being a Researcher Entrepreneur
forms of distractions, favoring risks over short- • Plan for as many contingencies as possible
term comfort. • Write detailed, well-thought-out business and
 A perfect example of a hustler is Mark Cuban. financial plans
He started in business very young selling trash • Focus on data and information rather than gut
bags, newspapers and even postage stamps and feeling
this hustle later created a goldmine which was • Won’t start unless they feel like they know the
acquired by internet giant Yahoo! market
Advantages of Being A Hustler: • Will minimize the chances of failing in the
• They will outwork most business
• Tend to have thick skin – they don’t give up • Disadvantages of Being a Researcher
easily Entrepreneur
• See disappointment and rejection as just a step • Typically moves slow
in the process • Doesn’t like risk and that can hamper progress
• Hustlers are motivated by their dreams and will in a new venture
work extremely hard to achieve them.  Even though these types of entrepreneurs
Disadvantages of Being A Hustler spend a lot of time researching and digging into
• Usually prone to burn out the data to ensure the success of their business,
• Wear out their team members who don’t have they can fall into the habit of obsessing over the
the same work ethic numbers and focusing less on the running of the
• Often don’t see the value of raising capital as business.
opposed to just working harder  Jeff Bezos has spoken against this in a recent
letter to shareholders where he asserted that
“Most decisions should probably be made with

Imitators
 somewhere around 70% of the information you involves asking questions, validating
wish you had”. assumptions, and taking nothing for granted.
Buyers The Skill of Empathy
Advantages of being a Buyer  The skill of empathy is understanding the
• Buying an already established venture is less emotion, circumstances, intentions, thoughts,
risky and needs of others. Empathy is being able to
• Doesn’t have to worry so much relate how others are feeling because you have
about innovation been in a similar situation yourself.
• Can focus on building on something that has The Skill of Creativity
already gone through building a foundation  The skill of creativity requires a general
• Already has a market for your products openness to the world and relates to unleashing
Disadvantages of being a Buyer our creative ability to create and find
• Usually pays a high price for good businesses opportunities and solve problems. We believe
• Will face the risk of buying businesses that have that entrepreneurship students are more open
problems that you think you can turn around to creativity than students from the other
businesses courses- a theory that has been
8 Business Entrepreneurs that can learn from Bill Gates supported by recent research. Our aim is to
1. Move Fast and Keep Innovating harness your creative potential so you can
2. Think ahead of times create opportunities, rather than simply
3. Your time is valuable discovering or looking for them.
4. Learn from your mistakes The Skill of Reflection
5. Persistence and perseverance  The skill of reflection helps make sense of all of
6. Takes risks the other actions required of play, empathy,
7. Never give up creativity, and experimentation. It helps codify
8. Focus on unhappy customer our learning from practicing the four other
skills. You may not realize it, but taking the time
Two Main Perspective in Entrepreneurship out to reflect is also an action, and it can be the
most important of all the five skills. Reflection
Predictive logic- a form of thinking that sees makes us aware of feelings of discomfort, helps
entrepreneurship as a linear process in which steps are us to critically analyze our own feelings and the
followed and outcomes are ideally predictable. knowledge we possess, provides us with new
Creative logic- a form of thinking that is used when the perspectives, and allows us to evaluate
future is unpredictable. outcomes and draw conclusions.

5 Skills most important to the practice of Effectual principles

entrepreneurship Bird in Hand Principle
 When expert entrepreneurs seek to build a new
The Skill of Play venture, they start with their means. These
 The skill of play frees the imagination, opens up means can be grouped into three categories:
our minds to a wealth of opportunities and • Who I am—my traits, tastes, and abilities
possibilities, and helps us to be more innovative • What I know—my education,
as entrepreneurs. training, expertise, and experience
The Skill of Experimentation • Who I know—my social and professional
 The skill of experimentation is best described as networks. Using a combination of these means,
acting in order to learn: trying something, the entrepreneur begins to imagine possibilities
learning from the attempt, and building that and take action. Most often, she starts very
learning into the next iteration. In the context small with the closest means and moves almost
of entrepreneurship, experimentation means directly into implementation without elaborate
taking action, such as getting out of the building planning (fire, aim versus aim, fire). With each
and collecting real-world information to test action, possible outcomes are reconfigured.
new concepts, rather than sitting at a desk Eventually, certain emerging effects coalesce
searching databases for the latest research. It into clearly achievable and desirable goals—
landmarks begin to appear on the blank map.
 The end goals are the combined result of the likelihood of feelings of helplessness and
imagination and aspirations of the entrepreneur depression. In other words, having a desire for
and the people she has interacted with during control over your life doesn’t make you a
the process. “control freak” (despite what your friends may
Lemonade Principle say!). Instead, it is normal and healthy. Many
 If you come across lemons, make lemonade! entrepreneurs instinctively recognize the
The third principle of effectual reasoning is at importance of personal control: fundamentally,
the heart of entrepreneurial expertise—the many chose entrepreneurship because they
ability to turn the unexpected into the want to be their own boss and choose their own
profitable. Expert entrepreneurs learn not only course. Control enables entrepreneurs to work
to work with surprises but also to take on things they think are important, set their
advantage of them. In most contingency plans, own schedules and work with whom they want.
surprises are bad—the worst-case scenarios. Many entrepreneurs attest that they feel
But because entrepreneurs do not tie their idea differently about running a business they own
to any theorized or preconceived “market,” as compared with working for a wage, and that
anything and everything is potentially a surprise they value being in control. For them, the
that can lead to a valuable opportunity. experience of personal control is closely
Crazy Quilt Principle associated with freedom, selfdirection and
 The crazy quilt principle of effectual reasoning is autonomy. The strength of a person’s desire for
the focus on building partnerships rather than control can be thought of as an element of his
beating competitors. Since entrepreneurs tend or her means: “Who you are.” While everyone
to start the process without assuming the has some desire for control, the intensity of that
existence of a predetermined market for their desire varies among individuals and over the
idea, they don’t know who their competitors course of a lifetime. For example, a high desire
will be, so detailed competitive analyses have for control may motivate someone to become
little value. Instead, entrepreneurs generally an entrepreneur, but the experience of working
take the product to the nearest potential for himself may strengthen the desire even
customer. Some of the people they interact further—he may not be able to imagine working
with make a commitment to the venture, for anyone else again.
committing time and/or money and/or Affordable Loss Principle
resources and, thus, self-select into the new-  They decide what they are willing to lose rather
venture creation process. The partnership than what they expect to make. Instead of
principle dovetails well with the affordable loss calculating upfront how much money they will
principle to bring the entrepreneur’s idea to need to launch their project and investing time,
market with very little cash expenditure. effort, and energy in raising that money, the
Obtaining pre-commitments from key effectual entrepreneur tries to estimate the
stakeholders, suppliers or customers helps downside and examines what she is willing to
reduce uncertainty in the early stages of lose. The entrepreneur then uses the process of
creating an enterprise. Finally, since the building the project to bring other stakeholders
entrepreneur is not wedded to any particular on board and leverage what they can afford to
market for his or her idea, the expanding lose together. An estimate of affordable loss
network of strategic partnerships determines to does not depend on the venture but on the
a great extent, which market or markets the person. It varies from person to person and
company will eventually end up entering or even across his or her life stages and
creating. be, but the issue remains. circumstances. For the Greenwoods
Pilot-in-the-Plane Principle (GoodKaarma article), affordable loss did not
 In fact, psychological research suggests that an permit the use of cash, but did include the use
enormous range of human behaviours relate to of their old farmhouse. By allowing estimates of
control striving in some way and are intrinsically affordable loss to drive decisions about which
linked to healthy human functioning. For venture to start, entrepreneurs stop depending
example, personal control is linked to the on prediction. Instead, they focus on cultivating
development of self-esteem and the reduction opportunities that have a low failure cost and
of stress, whereas loss of control increases the that generate more options for the future. The
 combination enables cheap failure and learning rewarded for our behaviour, then we are more likely to
that can be applied to the next iteration of the continue doing it.
opportunity. This does not mean that
entrepreneurs choose projects that won’t cost a The Mindset As The Pathway To Action
lot if they fail—or that they do not expect to The mindset is the pathway to action. There is no
make a lot of money. It simply acknowledges entrepreneurship without action, and the mindset is
that uncertain new venture opportunities are antecedent to action. As we have seen in the preceding
difficult to value upfront, whereas the sections, the entrepreneurial mindset requires the
investment of time, money, and other resources habits of self-leadership, creativity, and improvisation.
is quantifiable, manageable and controllable. These habits create an emotional platform for
entrepreneurial actions. You can have the best idea in
What is Mindset? the world, but without a mindset with a bias for action,
Fixed mindset: the assumption held by people who there is nothing—no new venture, product,
perceive their talents and abilities as set traits. organization or anything else. Taking action is the only
Growth mindset: the assumption held by people who way to get results. Even the process of changing and
believe that their abilities can be developed through expanding your mindset involves taking action through
dedication, effort, and hard work. deliberate practice.
But taking action requires a degree of confidence, and
The Mindset for Entrepreneurship belief in our abilities— an attribute known as self-
The growth mindset is essential to a mindset efficacy
entrepreneurship. There have been an increasing number of studies on
While there is no one clear definition of mindset and entrepreneurial self-efficacy (ESE), which is the belief
how it relates to entrepreneurs, we believe the most entrepreneurs have in their ability to begin new
accurate meaning of an entrepreneurial mindset is the ventures. Self-efficacy is an essential part of the
ability to quickly sense, take action, and get organized entrepreneurial mindset, and it is thought to be a good
under uncertain conditions. This also includes the ability indicator of entrepreneurial intentions as well as a
to persevere, accept and learn from failure, and get strong precursor to action. In fact, recent research
comfortable with a certain level of discomfort. suggests that entrepreneurial self-efficacy can enable
the entrepreneur to more effectively confront demands
Passion and Entrepreneurship or stressors and thus improve entrepreneurial
Among many elements of the entrepreneurial mindset, performance. In other words, the research suggests that
one of the most talked about is the element of passion. when we believe in our ability to succeed in something,
The entrepreneurial mindset is about understanding we are more likely to actively take the steps to make it
yourself, who you are, and how you view the world. It happen.
deeply connects to your desired impact which some
people equate to passion. In the past, researchers Fine line between self-confidence, self-efficacy, and
tended to use passion as a reason to explain certain arrogance
behaviors displayed by entrepreneurs that were Arrogance leads a person to believe that he or she
thought to be unconventional, such as perceived high achieved success without help from other; further, the
risk taking, intense focus and commitment, and a arrogant person may feel entitled to success and
entitled to “bend the rules” to get ahead.
dogged determination to fulfill a dream. 7 Indeed,
many well-known entrepreneurs such as Mark The Role of Mindset in Opportunity Recognition
Zuckerberg (Facebook founder), Jeff Bezos (Amazon As our mindset grows and expands through practicing
founder) and Pierre Omidyar (eBay founder) credit self-leadership, creating, and improvising, we are more
passion for their success. inclined to recognize and create opportunities. In fact,
Richard Wiseman’s study of luck, described in the
Entrepreneurship as a Habit Research at Work feature (p. 67), shows us that people
A habit is a sometimes unconscious pattern of who consider themselves lucky are more open to
behaviour that is carried out often and regularly. Good recognizing chance opportunities.
habits can be learned through “habit loop”- a process It is so easy to miss opportunities if we are not in the
by which our brain decides whether or not a certain right mindset.
behaviour should be stored and repeated. If we feel
Creating and Finding Opportunities strategies, is that one idea can lead to another, yielding
Entrepreneurs have a knack for looking at the usual and a pipeline of great ideas—that may impact the world.
seeing the unusual, at the ordinary and seeing the For example, scientists at the National Aeronautics and
extraordinary. Consequently, Space Administration (NASA) have needed to use a
they can spot opportunities that turn the great deal of imagination to come up with tools,
commonplace into the unique and unexpected.” protective clothing, personal care items, foodstuffs, and
—D. G. Mitton, author other inventions that can be used in outer space. Along
the way, these ideas led to other inventions that have
Strategies for Idea Generation changed many people’s lives here on Earth.

-Analytical strategies involve taking time to think -In order to think creatively, our mind needs to break
carefully about a problem by breaking it up into parts, out of its usual response patterns. Habit-breaking
or looking at it in a more general way in order to strategies are techniques that help to break our minds
generate ideas about how certain products or services out of mental fixedness in order to bring about creative
can be improved or made more innovative. In some insights. One strategy is to think about the opposite of
cases, you may see very little correlation between something you believe, in order to explore a new
problems until you think about them analytically. For perspective. Another method focuses on taking the
example, in one study, a group was asked to think about viewpoint of someone who may or may not be involved
different ways of stacking certain items. The ideas they in the situation. A popular habit-breaking strategy is to
came up with were then considered as ways to park take the role of a famous or admired individual and
cars. In another study, researchers found that artists think about how he or she would perceive the situation.
who carried out critical analysis before they started This is sometimes called the Napoleon technique, as in
their work, as well as through the duration of the task, “What would Napoleon do?” referring to the skills of
were more successful than those who did not use the this famous military and political leader.
same analysis.
-Relationship-seeking strategies involve consciously
-Search strategies involve using memory to retrieve making links between concepts or ideas that are not
information to make links or connections based on past normally associated with each other. For example, you
experience that are relevant to the current problem could make a list of words that are completely
using stimuli. For example, say you were asked to unrelated to the problem you are trying to solve, such
design a door hinge. Here, the door hinge is a stimulus as doorknob, then list the characteristics of each item
—a starting point for searching solutions to the on the list. Next, apply those characteristics to the
problem. Although you may not have any prior problem with a view toward coming up with ideas to
experience of designing door hinges, you could search solve the problem. The purpose of this exercise is to
your memory to see if you can think of anything that stimulate toward the mind into making connections that
you can associate with a door hinge to support the would otherwise have gone unnoticed.
design process. For example, the search process may
stimulate your memory of the opening and closing of a -Development strategies are employed to enhance and
clam shell. By drawing on this memory, you could use modify existing ideas in order to create better
your knowledge of the clam shell and apply it to the alternatives and new possibilities. A common exercise in
hinge design. This strategy illustrates our ability to be idea enhancement is to gather a group of four to six
resourceful in generating associations between objects people together. Each person writes down three ideas,
that at first appear to have no apparent relationship which are then passed around the group. Then every
with each other. member spends five minutes suggesting improvements
on the ideas to make them more feasible and effective.
-Imagination plays an important part in idea generation.
Imagination-based strategies involve suspending -The most dominant of the strategies within group
disbelief and dropping constraints in order to create scenarios are interpersonal strategies, in which group
unrealistic states, or fantasies. For example, the Gillette members collaborate to come up with new or improved
team also used imagination to come up with a new ideas. Group brainstorming is a good example of an
shampoo by imagining themselves as human hairs. interpersonal strategy where members exchange
One of the remarkable things about generating ideas, thoughts and build on ideas.
especially ideas that come from imaginationbased
Two Pathways To Opportunity Identification Repurpose- Change something in a product or service
to use the changed product or service for a different
Finding Approach purpose.
A concept that assumes that opportunities exist Unite- Combine two products to create a new product.
independent of entrepreneurs and are waiting to be Personalize- Design or produce (something) to meet
found. someone’s individual requirements.
Transplant- Take an idea that works in one place and
Building Approach introduce it in another place, which can be a country or
A concept that assumes that opportunities do not exist a different customer segment.
independent of entrepreneurs, but instead a product of
mind. DESIGN THINKING
Design is about making intent real. . . . When you
Through Active Search And Alertness design, something new is brought into the world with
Active search: method used by entrepreneurs in purpose. —Kevin Clark and Ron Smith, authors.
attempting to discover existing opportunities. What is design thinking?
A thinking process most commonly used to solve
Alertness: the ability some people have to identify complex problems, navigate uncertain environments,
opportunities. and create something that is new to the world.

From Idea Generation to Opportunity Recognition Design Thinking Relates to Needs

Products that achieve all three are bound to be the
Idea Generation- Productions of ideas for something most successful, but the product or service must first be
new. designed to provide a desired solution or fulfill a need
Creativity- Productions of Ideas for something new that for the design process to be considered human-
is also potentially useful. centered.
Opportunity Recognition- Recognition that ideas are Needs-human emotions or desires that are uncovered
not only new and potentially, but also have the through the design process.
potential to generate economic value. Companies that address customers’ needs can gain a
competitive edge.
Researchers have identified four approaches that we
can practice to enhance our creativity with our purpose Criteria for a Successful Idea
of transforming our ideas into opportunities. (SEEC)
Securing: The capacity to focus on and sustain new
ideas.
Expanding: The broadening or the acquisition of new
skills that enable people to generate ideas and share
knowledge.
Exposing: The skills required to open ourselves to
diverse and fluctuating circumstances and events.
Challenging: The process of building on past failures by Feasibility—what can be possibly achieved in the near
braving new encounters. future
Viability—how sustainable the idea is in the long term
D.I.S.R.U.P.T Desirability—who will want to use or buy the product
or service.
Derive- Extend an original idea modify to create a new
one. Design Thinking Process
Include- Add something new to an existing business or
process to add value and make different from original
idea.
Separate- Remove the connection between any two or
more people or things and create new idea.
Based on two thinking process: ▶ putting ideas together and improving on them.
Divergent Thinking- a thought process that allows us to
expand our view of the world to generate as many ideas Implementation tests assumptions of new ideas to
as possible without being trapped by traditional continuously shape them into viable opportunities.
problem solving methods or predetermined During the implementation phase, ideas generated
constraints. through the ideation process are transformed into
Convergent Thinking-a thought process that allows us concrete actions.
to narrow down the number of ideas generated through At the heart of the implementation process is low-cost
divergent thinking in effort to identify which ones have experimentation through rapid prototyping, which
the most potential. creates an actual model of the product or service, which
is then repeatedly tested for strengths and weaknesses
Key Parts of the Design Thinking Process until it leads from the project stage into people’s lives.
Inspiration is the problem or opportunity that Prototypes need not be sophisticated or expensive.
stimulates the quest for a solution. It starts with a broad
problem, or what is called a design challenge. A design Observation
challenge should not be too narrow, nor should it be
too broad. You want to have the freedom to imagine, Observation- the action of closely monitoring the
but you also want to have some boundaries in order to behaviors and activities of users/potential customers in
manage the process. Finding this sweet spot can be their own environment Observing people is where we
quite difficult and requires practice. This is where we hone our empathy skills
use the question, “How Might We?” Insight is an interpretation of an event or observation
Think about a fill-in-the-blank questionnaire as you that, importantly, provides new information or
develop your design challenge statement: How might meaning.
we enhance /create /improve /redesign /expand Observation is What while Insight is Why.
/reimagine /grow . . . ? Here are some examples:
▶ How might we enhance the entrepreneurship Observation Techniques
education experience of students?
▶ How might we improve how the elderly live Developing keen observation skills requires practice.
independently? The more we practice observation, the higher the
▶ How might we redesign how adults learn in virtual likelihood of our developing new, meaningful insights
worlds? that can lead to innovation solutions.
▶ How might we reimagine how people get around in a
town without cars? 9 Dimensions of Observations

The second phase of the design-thinking process is

ideation, which involves generating and developing new
ideas based on observations gained during the
inspiration process to address latent needs. Latent
needs are needs we have but don’t know we have. For
example, we didn’t know we needed an iPad until we
held one. The late Apple CEO Steve Jobs was very good
at identifying latent needs of customers, and he
possessed great observation skills; yet he was often
criticized for not talking to his customers. Latent needs
are more easily identified by observing rather than
talking.
Brainstorming is an important part of the ideation
process.
Four ground rules for brainstorming as pivotal to
divergent thinking:
▶ suspending all judgment;
▶ being open to wild suggestions;
▶ generating as many ideas as possible; and
Another technique used to guide observation efforts is
the AEIOU Framework

A-Activities – What are people doing?

E-Environment – How are people using the
environment? What is the role of the environment? I-
Interaction- Do you see any routines? Do you observe
people special interactions between people?
Between people and objects?
O-Objects- What’s there and being used or not used?
U-Users- Who are the users you are observing? What
are their roles? Are there any extreme users?

Interviewing As A Useful Technique For Identifying

Needs Other Approaches To Design Thinking
Interviewing is an important part of the inspiration
phase, as it is one of the most effective ways to identify A. The authors of Designing for Growth suggest four
and empathize with customer needs, create new ideas, questions that are useful to ask during the design-
and discover opportunities. It can be an alternative thinking process, all of which have periods of
and/or complement to observation. It’s simply another divergence and convergence. They are as follows:
way design thinkers collect data. A skilled interviewer is  What is?
openminded, flexible, patient, observant, and a good  What if?
listener. Like observation, interviewing is a skill that  What Wows?
improves with practice.  What works?
It’s very common for entrepreneurs to interview B. Another variation on the design thinking process is
customers after they have a product or service. These from the Stanford Design School, which uses five
are called feedback interviews. But it’s also common to phases:
use interviewing much earlier in the process to also Empathy-getting out and talking to your customers
develop insights and identify needs. Doing this ensures directly
that you are creating something that people actually Define-defining a statement problem from the empathy
need. Regardless of the type of interview you are work
conducting the following sections will help you develop Ideate-brainstorming ideas that could help solve the
your interviewing skills for maximum impact. problem identified
Prototype-building a crude version of the solution you
Interviews should be done for two reasons: want to test with users •Test –getting out and testing
with users
1. To develop a better understanding of their needs
during the inspiration phase of design thinking
2. Get feedback on ideas during the implementation
phase.

The interview must be well-prepared, the customer

must be listened to and intelligent questions asked, and
the interview must be evaluated when it is over.