1
Prof . R.K.Lagu
Sources of Business Opportunities
3.1
MG647
Innovation and Entrepreneurship
Sources of Business Opportunities - 3
Prof . Rajendra K Lagu
School of Management
IIT Bombay
Prof . R.K.Lagu
Sources of Business Opportunities
3.2
Viable Business Proposition
• Some product or service that delivers “Value” to a set of
customers
• “Value” is a customer-centric (outside-in) perspective
• Think like a customer – put yourself in the “customer’s
shoes”
• Think Bottom-up and Top-Down
• Top Down: Market split in market segments
• Bottom Up: Set of customers grouped to a market segment
Prof . R.K.Lagu
Sources of Business Opportunities
3.3
Pitfalls in Customer Feedback
•
Customers may simply not know (Walkman, Palmtop)
•
Customers may have difficulty comprehending or they
may misunderstand (Building a prototype helps)
•
Customers may not have time (attention-scarce
economy)
•
Customers may bluff for a variety of reasons
•
Getting detailed feedback will be too expensive
Prof . R.K.Lagu
Sources of Business Opportunities
3.4
Entrepreneur as a Visionary must
Anticipate
•
Analyze all the changes that are happening in the target
market
•
Estimate the time constants of changes – fast or slow
• Worry about the fickleness of customer tastes
(especially fashions, movies)
•
Make reasonable guesses
•
Validate your hypotheses at each stage as new field
data arises
•
Study human psychology or consumer behaviour
Prof . R.K.Lagu
Sources of Business Opportunities
3.5
Change as a Source of Opportunity
•
Status-quo is good for incumbent players (established
companies) – they have products or services, smooth
operations, established business models, loyal set of
customers, functional teams ……
• Change brings in disruption – that in consumer tastes, cost
structures, business models, expectations, level of
expertise needed, distribution channels, payment
mechanisms, availability of finance
•
Change produces a level-playing field which is actually
loaded in favour of a new player because of his flexibility,
a