Common Misconceptions and Realities of Great Ideas, Misconception 1, Ideas just appear out of nowhere

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  • 1.Common Misconceptions and Realities of Great Ideas Misconception 1. Ideas just appear out of nowhere. 2. There are no stupid ideas. 3. Customers will tell you what to do if you’ll only listen. Reality 1. The most successful idea generators do so in a structured, systematic way. 2. The most powerful ideas often are resoundingly bad, at first glance. 3. Although customers can help identify unmet needs, there’s much more involved in making an idea workable.
  • 2.Common Misconceptions and Realities of Great Ideas Misconception 4. We can generate all the ideas we’ll ever need if we just sit down at a meeting. 5. Getting ideas isn’t the problem; implementing them is. Reality 4. Great ideas are best shaped through an ongoing dialogue. 5. The problem is not screening carefully the ideas that are generated.
  • 3.Potential Sources of Entrepreneurial Ideas Personal interests or hobbies Work experiences, skills, and abilities Products and services Familiar ones Unfamiliar ones External environmental opportunities in these sectors Technological Societal culture Demographics Economic Legal-political
  • 4.Potential Sources of Entrepreneurial Ideas Limitations of what’s currently available New and different approaches Advances and breakthroughs Unfilled niches Trends and changes
  • 5.Why Idea Evaluation Is Important Minimize Risk While Maximizing Return Decide What Is Important Identify Strengths and Weaknesses of Ideas Make Best Use of Limited Resources
  • 6.How to Evaluate Ideas Do you have the capabilities for what you’ve selected? Are you ready to be an entrepreneur? Are you prepared emotionally to deal with the stresses and challenges of being an entrepreneur? Are you prepared to deal with rejection and failure? Are you ready to work hard? Do you have a realistic picture of the venture’s potential? Have you educated yourself about financing issues? Are you willing and prepared to do continual financial and other types of analyses?
  • 7.Evaluating Marketplace Potential Who are the potential customers for your idea: who, where, how many? What similar or unique product features does your proposed idea have to what’s currently on the market? How and where will potential customers purchase your product? Have you considered pricing? Have you considered how you will need to promote and advertise your proposed entrepreneurial venture?
  • 8.Feasibility Studies Issues to Consider: Introduction Historical background Description of product or service Accounting considerations Management considerations Marketing considerations Financial considerations Legal considerations Tax considerations
  • 9.Getting Competitor Information Identifying Strategic Groups Quality Geographic Scope Product Line Breadth—Depth Market Share Product Characteristics Profits Other Relevant Factors Price
  • 10.Researching Competitor Information What types of products or services are competitors offering? What are the major characteristics of these products or services? What are their products’ strengths and weaknesses? How do competitors handle marketing, pricing, and distribution? What do they attempt to do differently from other competitors? Do they appear to be successful at it? Why? Why not? What are competitors good at? What are their competitive advantages? What are they not good at? What are their competitive disadvantages? How large and profitable are competitors?
  • 11.Ethically Questionable Competitive Intelligence Methods Trying to get proprietary information by bribing individuals who once worked for competitors Questioning competitors’ employees at technical meetings by disguising who you are and whom you work for Going on false interviews with a competitor Hiring a competitor’s employee(s) away to obtain specific know-how or trade secrets Secret direct observation of a device or piece of equipment Conducting false job interviews with competitors’ employees
  • 12.Competitor Analysis Matrix Competitive Information Business 1 Business 2 Business 3 Business 4 Products or Services Offered Product Strengths Product Weaknesses Competitive Advantage(s) Competitive Disadvantage(s) Other Competitive Information
  • 13.Possible Financing Options Common Options: Personal resources Angel investors Financial institutions Unusual sources Venture capitalists Public offering Business development programs
  • 14.Entrepreneurs’ Personal Resources Common Resources: Personal savings Home equity Proceeds from the sale of personal assets Life insurance policy loans Personal loans Credit cards Loans from family or friends
  • 15.Business Development Business Development Programs: Small Business Investment Companies (SBICs) Small Company Offering Registration (SCOR) Business Incubators Angel Capital Electronic Network (ACE-Net)
  • 16.Evaluating Financing Options Personal Control Personal Risk Potential Reward Personal Resources High High High Financial Institutions Low to medium Low Low to medium Venture Capitalists Low to medium Low Low to medium Angel Investors Low to medium Low Low to medium Public Offerings Low Low Low to high Business Development Low to medium Low Low to medium Programs Unusual Sources Low to high Low Low to high
  • 17.Vision and Mission Vision: An overall picture of where the entire organization would like to be in the future Mission: A statement of what the various organizational units do and what they hope to accomplish in alignment with the organizational vision
  • 18.ISE Department Vision: To be a world-class undergraduate and graduate program in Industrial and Systems Engineering that focuses on the integration and management of resources and knowledge for the manufacturing and service industries.
  • 19.ISE Department The mission of the ISE Department is to teach, conduct research, and serve the community through professional and technology development. The ISE Department intends to constantly increase educational quality and opportunity for students that foster responsibility, creativity, leadership, the habit of individual inquiry, and the capacity for lifelong learning. The ISE Department is committed to providing graduates who improve the quality of life and meet the needs in the manufacturing and service industries. The ISE Department strives to attain a level of research and scholarly productivity befitting a major research university and warranting national and international recognition for excellence.
  • 20.Components of Organizational Vision and Mission Statements Markets Technology Concern for Survival, Profits, and Growth Products or Services Self-concept Concern for Public Image Concern for Employees Philosophy Customers
  • 21.Purposes of a Business Plan Development tool for organizational founders Vision and mission clarification Planning and evaluation guidelines Tool for securing financial resources Tool for guiding growth
  • 22.Business Planning What the Business Plan Should Include: Executive Summary Analysis of Opportunity Analysis of Context Description of Business Financial Data and Projections Supporting Documentation
  • 23.Writing a Successful Business Plan 10 Characteristics: 1. Clear, realistic financial projections 2. Detailed market research 3. Detailed competitor research 4. Descriptions of key decision makers 5. Thorough summary 6. Proof of vision 7. Good formatting and clear writing 8. Brief and concise 9. Demonstrates the importance of the bottom line 10. A plan that captures “you”