CHAPTER 2 : BUSINESS IDEAS AND OPPORTUNITIES

  

DEFINITION
Ideas : Thought, notion or impression.

Opportunity : Favourable set of circumstances that creates a need for a new product, service or business.

IDENTIFICATION, EVALUATION AND SELECTION OF BUSINESS OPPORTUNITIES

• Identification of needs and wants of customers
• Environmental assessment, self analysis and community values
• Evaluation of business opportunities
• Selection of business opportunities

Identification of needs and wants of customers

Needs

Wants

Environmental assessment, self analysis and community values

• Population structure, income, trend and preference
• Import and export data
• Industrial linkages
• Development plan by government and private sector
• Analysis of social problem
• Study of government's regulation

 Evaluation of business opportunities

• Preliminary screening
• Evaluate in term of:  Legal consideration, degree of competition, capital requirement, risk involved

Selection of business opportunities

• Select business opportunities which meet the criteria that have been set.
• The selected business opportunities will be further evaluated by developing a business plan.
• Writing-up a business plan is a first step towards the implementation of the business opportunities.

TECHNIQUES FOR GENERATING NEW BUSINESS IDEAS

• Brainstorming
• Focus group
• Surveys
• Day-in-the-life research
•  Customer advisory board
• IDEO Method Cards

CHAPTER 1: INTRODUCTION TO ENTREPRENEURSHIP (cont)

INTRAPRENEURSHIP

Individuals in organizations with high entrepreneurial characteristics. (Pinchot, 1985)

Inside the entrepreneur who follow the goal of the organization.

Individuals with entrepreneurial characteristics who practice their idea on company’s product.

Characteristics of Intrapreneur

Main Motive	-Wants freedom -Tries to ensure effective usage of company’s internal resources -Goal oriented and self-motivated, but expects reward and recognition from the   company.
Time orientation	-Gives 3 to 15 years to achieve his or her goal, depending on the type of exploration and level of top management’s commitment.
Action/behaviour	-Wants fast action by own initiative and support from the organization. -Knows the benefits that could be gained from daring actions.
Skills	-Like entrepreneur, intrapreneur has in depth understanding of business field- however focuses more on internal development. -Requires resource support from company’s top management -Bound by corporate policy in exploiting his or her skills. -Use of creativity and innovation.
Resource requisition	-Depends on the resources provided by the company.
Motivation and ability	-Has self-confidence due to encouragement from friends and families -Most are cynical towards the system, but very optimistic with regard to their own ability to start a business.
Attention	-Gives full attention to factors internal and external to the company. -Focuses on the need for new exploration, market and customer.
Risk acceptance	-Willing to take some risks -Ready to free oneself from the company -Chosen career and tasks in considered as a challenge
Market research	-Does his or her own market research and intuitive market evaluation
Failures and mistakes	-Has the tendency to hide risky projects from others or uses the company’s name to hide from mistakes -Willing to learn from mistakes
Decision making	-Has the skill to persuade the company to accept projects that he or he likes. -Has the patience and more willing to compromise compared to entrepreneur -Bound by company’s hierarchical structure, which means all decision have to referred to company’s top management.
Attitude regarding status	-Does not care about status quo -Wants freedom and flexibility

Importance of Intrapreneurship Development

-Enable the company to vary its business

-Help in integrating secondary activities that are not directly related to the mission of the organization.

-Prevent people from compromising instead of finding the best solution.

-Helps company in adapting to the dynamic and challenging business environment.

-Provide the opportunity for the company to try new markets

-Helps in reducing response time

Intrapreneur Development Process Model

Problem Definition -> Building Partnership -> Resource Distribution->Project Implementation->Project Completion

Strategies to Develop Intrapreneurs

-Develop an environment that encourages intrapreneurial activities

-Avoid extreme bureaucracy

-Develop efficient control system for the company

Intrapreneurship vs Entrepreneurship: Is there any Difference?

INTRAPRENEURSHIP	ENTREPRENEURSHIP
Still company employees, but they are supposedly given free rein to run a particular aspects of the company, perhaps a new product line or subsidiary.	Self-employed people running their own company.
Know if they fail, the company is still going to ensure they have a paycheck, at least for a while. Are chosen based on corporate standard, not entrepreneurial success.	If the entrepreneur fail, the company also will fail. They’re worry about making enough money to meet payroll and pay other bills.
Selected by a corporate hierarchy and don’t have to worry about building more structure they need to sustain a business.	Build all of them themselves.
Have at least a modicum of support from the primary organization and get final approval from senior executive.	Support their own company and entrepreneur make decision by themselves.

CHAPTER 1:INTRODUCTION TO ENTREPRENEURSHIP

 

CHAPTER 1      : INTRODUCTION TO ENTREPRENEURSHIP

Entrepreneurship: Process of creating something new with value and devoting the necessary time and effort, assuming the accompanying financial, physical and social risks and receiving the resulting rewards or monetary and personal satisfaction and independence (Hisrich R.D and Peter M.P)

Entrepreneur: - entre (between)

                      - prendre (to take)

Business : Commercial activity  engaged in as a means of livelihood or profit or an entity which engaged in such activities.

Entrepreneur : Person who starts a new business venture, actively lead their own business & nurture them to growth and prosperity.

Businessperson: Person who engaged in commercial or industrial business (especially an owner or executive).

Entrepreneur	Businessman
Wide scope of business	Narrow scope of business
Social contribution	Profit oriented
Expanded business	Small scale operation and static management

Entrepreneurship vs Small Business

- Amount of wealth creation                            - Speed of wealth creation

- Risk                                                               - Innovation

Development of Entrepreneurship Theories

Richard Cantillon (1725) > Adam Smith (1776) > Jean Baptise Say (1803) > John Stuart Mill (1848) > Carl Menger (1871) > Joseph Aloysius Schumpeter (1934) > Alfred Marshall (1936) > Ibnu Khaldun > David C. Mclelland.

ENTREPRENEURSHIP’S EVOLUTION : Islamic Perspective

Integration

-Islam is a complete way of life. There is no separation between business and religion.

-Islamic entrepreneur is part of the way of life.

-Muslin are encouraged to get involved in business activities.

Worship

-Business – Fardhu Kifayah

Motivation

-Following the sunnah of anbiya and the companion of Rasulullah saw.

-Islamic entrepreneur leads to the path of success both in this world and hereafter.

-Factors that motivate Muslim entrepreneur/types of success (as suggested by Ahmad al-Qurtubi): Halal income, Qanaah, Taufiq, Saadah, and Jannah.

-Islam discourages muslim entrepreneur to accumulate their property by ignoring others.

-Success in Islam is not measured by the result but also the means and ways of achieving it. All the intention, the implementation must be parallel with the Islamic regulation.

Human Nature

-It is a part of human nature to follow the teaching of the religion.

-All human beings are appointed to be the leader/khalifah.

-Maximizing profit is not the ultimate aim of the entrepreneur.

-Islamic Man vs Economic man

System

-Islmaic Economic System : Islamic banking, Insurance & Islamic Capital Markets

Relationship between Business and Entrepreneurship

-A good Muslim entrepreneur must conduct the business activities according to the Islamic principles and conducts.

-Does not allowed to involve in usury and bribery.

Guideline

-Islam has provided an extensive guideline for Islamic entrepreneur activities.

-Doing a business ethically differentiate a good entrepreneur or not.

Behaviour

-An excellent moral conduct shall be pictured as a good behavior in business ethics.

-Business is secondary to the call of Jihad (crusade)

-Never use power or influence for self-interest.

-Afraid of accumulate wealth.

-Leadership qualities in all aspects.

-Practice moderate way of life.

LEVEL OF SUCCESS (ACCORDING TO AL-GHAZALI)

- knowledge     -repentance      -challenges                   -obstacles        

-motivation      -handicap         -praise and thankfulness

POSESSION OF WEALTH

Islam Proposed -> Allah Prepared -> Islam Outlined -> Allah Promised

ADVANTAGES OF BEING ENTREPRENEUR

·         Opportunity to gain control over one’s own destiny

·         Opportunity to reach one’s full potential

·         Opportunity to benefit financially

·         Opportunity to contribute to society and be recognized for one’s efforts.

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