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Learning outcomes
 Explain nature of innovation
 Critical role of entrepreneurs in the process of
    innovation
   Link between innovation, opportunity and
    entrepreneurship
   Opportunity can be stimulated in a systematic way
    Sources of opportunity
   Are you an innovative thinker
Learning outcomes Cont…
Creativity & its importance
 Explain what makes an individual creative
 Relation of Creativity & logical thinking
 Creativity process
 Barriers to creativity
 Techniques to increase creativity
 Steps to become creative
 Creativity vs. innovation
 Innovation creativity & entrepreneurship
Creativity & Innovation




Ideas                 Ideas + Action
                Innovation
Kantar defines Innovation as
As the generation, acceptance and implementation of new
  Ideas, processes product and services

Mintzberg defined innovation as
  As the mean to break away from established pattern in
 other words doing things in really different way
Cont….
 Porter presents that innovation is not just a single
  major technological breakthrough infact it is a
  accumulation of small changes in the product ,services
  and in processes

 Morris and Kuratko present the list of continuum of
  possibilities for innovation in product/services and
  processes
Types of innovation
 The introduction of new or improved goods or services
 The introduction of new processes
 The opening up of new market
 The identification of new source of supply of raw
  materials.
 The creation of new types of industrial organization
Process of Innovation
  Effectiveness Criteria for an Innovation process
 Implement a few ideas at regular intervals

 Ensure feedback takes place - there must be communication channels
  to originators.

 Screening system should be simple, understood by everyone

 Ensure the system is promoted

 Transform ideas into reality at a reasonable speed - if the system is too
  slow we may be too slow to react to the market pace and turn off idea
  originators.
Frequent route of innovation for entrepreneurial firms

Product/services                       Process development
development                             Major new processes
 New to the market
 New product/service line within       Minor new processes
    the company
   Addition in the line                Significant revision to existing
   Improvement or revision              processes
   New applications in the existing
    product and services                Modest improvement to existing
   Repositioning of the existing        process
    product
    Cost reduction for the existing
    products/ services
Innovation and opportunity
 Innovation can be successful only when it is linked to
 customer demand –existing or in future- this is the
 market opportunity…

 This is the link between innovation and opportunity
  and it help entrepreneurial firms in gaining
  competitive advantage it seeks ..
For example
Anita Roddick (body shop), Ingvar kampard (IKEA)
Innovation and Entrepreneurship
 Economic development is the process caused by
  the enterprise-or innovation and this carried out
  by entrepreneurs which show a strong relation that
  innovation has with entrepreneurship

 It is innovation and entrepreneurship that are at
  the heart of success for the individual firm and of
 national advantage
Creativity and Entrepreneurship
                      Entrepreneurship/Opportunity

                         Low               High



              High   STRUGGLER        INNOVATOR
Innovation/
Creativity
              Low    STAGNATOR           COPIER
Innovation Model
Sources of Opportunity
 According to Peter Drucker innovation can be
  practiced systematically through the creative
  analysis of change in the environment and the
  opportunity it generates
 Entrepreneur need to search purposefully for the
  sources of innovation that indicate opportunity for
  them
Druker’s Sources of Opportunity
 The unexpected
 The incongruity
 The inadequacy in underlying processes
 The changes in industry or market structure
PLUS
 Demographic changes
 Changes in perception, mood or meaning
 New knowledge
Drucker’s 5-stage approach to
innovation
 Analyse opportunities, internal and external. Innovate
 for NOW – timing is everything
 Innovation is conceptual and perceptual, so look at
 financial implications and analyse whether it meets
 the opportunity
 Keep innovation simple – KISS!
 Start small, take an incremental approach
 Aim at leadership and dominate the competition as
 soon as possible
Factors influencing small firms’
growth
 Shift from manufacturing to service
 Deconstruction of large firms
 Growth of subcontracting
 Technology
 Social trends
 Economic trends
Innovation and Location
 Geographical proximity facilitates the process of
 knowledge transfer and hence different cluster of small
 firms can be observed
Are you an innovative thinker?
 Change agent
 Consolidator
 Harmoniser
 Fire fighter
 Co-operator
 Catalyst
 Incremental innovator
 Spice-of-life
 Middle-of-the-road
Difference between an innovator and adaptor in terms
of approaches each take for problem solving
            Adaptor                            Innovator
 Have disciplined, precise,          Approaches task from
    methodical approaches              unusual angles
   Concerned with solving,           Discover problems and
    rather then finding problems       avenues of solution
   Refine current practices
                                      Question basic assumption
   Tends to be mean oriented          related to current practice
   Capable of extended detail
                                      Little regards for means; is
    work
                                       more interested in ends
   Sensitive to group cohesion
    and cooperation                   Has little tolerance for
                                       routine task
                                      Has little or need for
                                       consensus; often is
                                       insensitive to others
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professors where they find lot of lectures and
Projects.


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