Chapter 2 Flashcards
Doing things differently.
Innovation
Why do firms use innovation?
for the purpose of producing competitive advantage.
Why is creativity important for innovation?
To spot opportunities in the market.
The ability to develop new ideas and to discover new ways of looking at problems and opportunities; thinking new things.
Creativity
The ability to apply creative solutions to problems or opportunities to enhance or to enrich people’s lives; doing new things.
Innovation
Are inventors entrepreneurial?
Not necessarily, they may need a help of an entrepreneur to link their invention to market demand.
However, others may be an inventor, innovator, and entrepreneur – all in one.
Discuss invention, innovation and creativity at the macro and micro level.
- At the macro level, entrepreneurship and innovation are seen to encourage economic growth.
- At the micro level, innovation is the prime tool entrepreneurs use to create or exploit opportunity.
The result of a disciplined, systematic process of applying creativity and innovation to the needs and opportunities in the marketplace.
Entrepreneurship.
What does innovation in business mean?
• Developing new product
• Developing new technology
• Developing any new way of doing something
• New way of delivering an existing product or services
• New way of informing the customer about the product
• Any new approach to manage the business and gain profit
What are the forms of innovation?
- Product innovation
- Process innovation
- Market innovation
Improvements in the design and functional qualities of the product or service
Product innovation
Improvements in how the product is produced, assembled, or delivered, so that it is better or cheaper (e.g. the substitution of a cheaper material in an existing product).
Process innovation
Improvements in the marketing of the product or service (e.g. use of social media) or changes in the business model that might open up new markets (e.g. selling online as well as face- to- face).
Marketing innovation
Discuss industry 4.0
- Machine-to-machine and machine-to-work communication
- Use of Bluetooth and Wi-Fi
- Application of artificial intelligence
- Less human intervention
Any product of human intellect that is intangible but has value in the marketplace.
Intellectual property.
Why is it called “intellectual” property?
Because it is the product of human imagination, creativity, and inventiveness.
What are some Common Mistakes Firms Make regarding the Protection of their Intellectual Property?
- Not properly identifying all of their intellectual property.
- Not fully recognizing the value of their intellectual property.
- Not using their intellectual property as part of their overall plan for success.
- Not taking sufficient steps to protect it.
What determines what Intellectual Property to Legally Protect?
Criteria 1
• Determine whether the intellectual property in question is directly related to the firm’s competitive advantage.
Criteria 2
• Decide whether the intellectual property in question has value in the marketplace.
What are The Four Key Forms of Intellectual Property?
• Patents
• Trademarks
• Copyrights
• Trade Secrets
A grant from the government conferring the rights to exclude others from making, selling, or using an invention.
Patent.
What does a patent grant?
Doesn’t give its owner the right to make, use, or sell an invention; rather, the right granted is only to exclude others from doing so.
What are the types of patents?
Utility
Design
Plant
Global indicator for the innovation.
Oman’s Global Innovation Index (GII).
Discuss Oman’s economy.
- Oman saw a decline in crude oil and natural gas exports in early 2021.
- The country needs to shift to a knowledge-based economy and diversify its sectors.
- Growth was driven by increases in mineral products, chemical products, and food and beverages.
What are the innovation challenges in Oman?
• Schooling Education
• Expenditure on R&D
• Using Information Technology (IT)
• Knowledge production
• Patents numbers
• Scientific Publications
• Economics depending on Oil and Gas
What are the main objectives of Oman’s National Innovation Strategy 2040?
• Creating jobs positions
• Economic Diversification
• Create innovation environment
• Increase the income per capita
What are the Oman policy priorities to promote innovation?
- Develop Human capital
- Increasing the non-oil sectors contribution to the Oman’s GDP
- Encouraging the transfer to the Knowledge Based Economy
- Improve the innovation environment
Discuss the building of Oman’s Innovation Ecosystem.
Oman has taken steps to foster innovation by establishing the Ministry of Higher Education, Research, and Innovation in 2020, making it the first ministry with innovation responsibilities. Additionally, the General Directorate of Innovation Center was created, consisting of five departments dedicated to developing the country’s innovation ecosystem.
A favorable set of circumstances that creates a need for a new product, service, or business.
An opportunity
What is the key to opportunity recognition?
To identify a product or services that people need and are willing to buy, not on that an entrepreneur wants to make and sell.
What are the four essential qualities of an opportunity?
- Attractive
- Timely
- Durable
- Anchored in a product, service, or business that creates or adds value for its buyer or end user
What are the three ways to identify an opportunity?
- Observing trends
- Solving a problem
- Finding gaps in the marketplace
What are the most important trends?
• Economic forces
• Social forces
• Technological advances
• Political and regulatory changes
What are some Environmental Trends Suggesting Business, Product, or Service Opportunity Gaps?
- Economic forces
- Social forces
- Technological advances
- Political and regulatory and regulations
What are the economic forces?
- State of the economy
- Level of disposable income
- Consumer spending patterns
What are the social forces?
- Social and cultural trends
- Demographic changes
- What people think is “in”
What are the technological advances?
- New technologies
- Emerging technologies
- New uses of old technologies
What are the political and regulatory changes?
New changes in political arena
New laws and regulations
What is an opportunity gap?
Difference between what’s available and what’s possible
………. trends help determine areas that are ripe for new start-ups and areas that start-ups should avoid.
Economic
Does a weak economy favour or not favour startups?
Favours them
…………. trends alter how people and businesses behave and set their priorities. These trends provide opportunities for new businesses to accommodate the changes.
Social
What are some examples of social trends?
• Aging of the population.
• The increasing diversity of the population.
• Millennials entering the workforce.
• Growth in the use of mobile devices.
• An increasing focus on health and wellness.
What are some examples of Entire Industries that Have Been Created as the Result of Technological Advances?
• Computer industry
• Internet
• Biotechnology
• Digital photography
How to pinpoint problems?
Through observing trends and through more simple means, such as intuition, serendipity, or chance.
How are gaps in the market created?
When a product or service is needed by a specific group of people but doesn’t represent a large enough market to be of interest to mainstream retailers or manufacturers.
What are the characteristics that tend to make some people better at recognising opportunities than others?
- Prior Industry Experience
- Cognitive Factors
- Social Networks
- Creativity
How does prior industry experience help an entrepreneur?
• By working in an industry, an individual may spot a market niche that is underserved.
• It is also possible that by working in an industry, an individual builds a network of social contacts who provide insights that lead to recognizing new opportunities.
Is prior industry experience always needed?
No, sometimes people outside an industry can sometimes enter it with a new set of eyes, and as a result innovate in ways that people with prior experience might find difficult.
What is the basis of opportunity recognition?
An innate skill or a cognitive process
The ability to notice things without engaging in deliberate search.
Entrepreneurial alertness
What is the entrepreneurs’ sixth sense called?
Entrepreneurial alertness
How do social networks affect opportunity recognition?
- People with social and professional contacts are exposed to more opportunities
- Most people get their ideas via a social contact
What are the two type of relationships? Discuss them.
• Strong-tie relationships are characterized by frequent interaction and form between coworkers, friends, and spouses.
• Weak-tie relationships are characterized by infrequent interaction and form between casual acquaintances.
Why is it more likely for an entrepreneur to get their idea from weak tie relationship?
Strong tie relationships happen between likeminded people and they reinforce existing ideas. Weak tie relationships on the other hand spark new ideas.
The process of generating a novel or useful idea.
Creativity
What are the steps to becoming an entrepreneur?
- You decide to become and entrepreneur
- Come up with an idea
- Feasibility study
- Look for funding
What are the creative idea generation steps?
- Preparation
- Incubation
- Insight
- Evaluation
- Elaboration
Techniques for Generating Ideas.
● Brainstorming
● Focus Groups
● Role Models
Is the process of generating several ideas about a specific topic.
Brainstorming
What are the rules for a brainstorming session?
● No criticism.
● Freewheeling is encouraged.
● The session should move quickly.
● Leap-frogging is encouraged.
A group of people who are familiar with a topic, are brought together to respond to questions, and who are able to shed light on an issue through the give-and-take nature of group discussions.
Focus group
Works best as follow up for brainstorming.
Focus group
Those who can encourage others to pursue certain career paths or pursue certain goals.
Role-models
…………. towards entrepreneurship is necessary for high entrepreneurial intention.
Positive attitudes
The absence of role models leads to …
Low entrepreneurial intention
Other idea generation techniques.
• Customer Advisory Boards
• Day-In-The-Life Research
• Government Conferences & Announcements
Companies form groups of customers who meet regularly to discuss their needs and problems, inspiring new ideas (e.g., Target).
Customer advisory boards
A type of anthropological research, where the employees of a company spend a day with a customer.
Day-In-The-Life Research
A term used to explain the creative process of finding solutions to problems using a holistic approach and “thinking outside the box”.
Design thinking
A loose set of holistic concepts that approach design from the perspective of solving complex problems for people, rather than just creating distinctive objects or shapes.
Design thinking
Is just that way of thinking rather than a clearly defined set of processes.
Design thinking
A human-centered innovation approach that uses the designer’s tools to consider people, technology, and business success.
Design thinking
The user’s experience.
People’s practical and emotional needs.
What does design thinking focus on?
The entire customer experience, not just individual products or services.
What’s unique about design thinking?
- Human centred
- Highly creative
- Collaborative
- Iterative
- Hands-on
- Show, don’t tell
What is the design thinking process?
(EDIPT)
Empathise
Define
Ideate
Prototype
Test
Discuss stage 1 of design thinking.
Empathy with users – goes to the core of any new value. Understanding customers needs and finding solutions to problem they face.
These needs are both functional and emotional (head and heart).
Discuss stage 2 of design thinking.
Identify the real problem to solve, not necessarily the obvious one, and define the design brief in a way that is unconstrained by existing solutions.
Discuss stage 3 of design thinking.
Think outside the box - look at the problem form different perspectives and come up with as many different ideas and options as possible.
This may involve a multidisciplinary approach and periods of divergent and convergent thinking. Do not close down options too early.
Discuss stage 4 of design thinking.
• Start to Create Solutions.
• This is an experimental phase.
• The aim is to identify the best possible solution for each problem found.
• Experiment with prototype solutions to see which work.
Discuss stage 5 of design thinking.
• Try Your Solutions Out and monitor effectiveness.
• Prototype solutions – both products and services – need to be tested, iterated, and refined.
• Learn – always learn from both success and failure.
