Baron

Opportunity recognition

-is the active, cognitive process (or processes) through which individuals conclude that they have identified the potential to create something new that has the potential to generate economic value and that is not currently being exploited or developed, and is viewed as desirable in the society in which it occurs (i.e. its development is consistent with existing legal and moral conditions). (Baron, 2004b, p. 52)

Because opportunity recognition is a cognitive process, according to Baron (2004b), people can learn to be more effective at recognizing opportunities by changing the way they think about opportunities and how to recognize them.

Drucker

Systematic innovation involves “monitoring seven sources for innovative opportunity” (Drucker, 1985, p. 35). The first four are internally focused within the business or industry, in that they may be visible to those involved in that organization or sector. The last three involve changes outside the business or industry.

Internally Focused

The unexpected (unexpected success, failure, or outside events)

The incongruity between reality as it actually is and reality as it is assumed to be or as it ought to be Innovation based on process need

Changes in industry structure or market structure that catch everyone unawares

Externally Focused

Demographics (population changes) Changes in perception, mood, and meaning

New knowledge, both scientific and nonscientific

Mitchell

One of the components of Mitchell’s (2000) New Venture TemplateTM asks whether the venture being examined represents a new combination. To determine this, he suggests considering two categories of entrepreneurial discovery: scientific discovery and circumstance.

Scientific Discovery Physical/technological insight New and valuable way Circumstantial Discovery

Specific knowledge of time, place, or circumstance When and what you know

The second set of variables to consider are the market imperfections that can create profit opportunities: excess demand and excess supply. This gives rise to the following four types of entrepreneurial discovery.

Circumstances reveals opportunity to exploit excess supply (a market imperfection) Example: Producer’s capacities to lower prices = Wal-Mart

Schumpeter

Schumpeter’s (1934) five kinds of new combinations (see page 13) can occur within each of the four kinds of entrepreneurial discovery (Mitchell, 2000)

Murphy

Murphy (2011) claimed that there was a single-dimensional logic that oversimplified the approach taken to understand entrepreneurial discovery. He was bothered by the notion that entrepreneurs either deliberately searched for entrepreneurial opportunities or they serendipitously discovered them. Murphy’s (2011) multidimensional model of entrepreneurial discovery suggests that opportunities may be identified (a) through a purposeful search; (b) because others provide the opportunity to the entrepreneur; (c) through prior knowledge, entrepreneurial alertness, and means other than a purposeful search; and, (d) through a combination of lucky happenstance and deliberate searching for opportunities.

Design Thinking

Design thinking is a human-centered approach to innovation that draws from the designer’s toolkit to integrate the needs of people, the possibilities of technology, and the requirements for business success – Tim Brown, president and CEO (IDEO, 2015, para. 5)

Design thinking is a deeply human process that taps into abilities we all have but get overlooked by more conventional problem- solving practices. It relies on our ability to be intuitive, to recognize patterns, to construct ideas that are emotionally meaningful as well as functional, and to express ourselves through means beyond words or symbols. Nobody wants to run an organization on feeling, intuition, and inspiration, but an over-reliance on the rational and the analytical can be just as risky. Design thinking provides an integrated third way.The design thinking process is best thought of as a system of overlapping spaces rather than a sequence of orderly steps. There are three spaces to keep in mind: inspiration, ideation, and implementation. Inspiration is the problem or opportunity that motivates the search for solutions. Ideation is the process of generating, developing, and testing ideas. Implementation is the path that leads from the project stage into people’s lives (IDEO, 2015, para. 7-8).

Discuss the concept that the leading thinkers are introducing which deals with opportunity thinking and design thinking, analyse their concepts by providing specific examples and cite readings (e.g. articles, narrative, research) from reputable sources.

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