TEM 100: THE ENTREPRENEURIAL MIND | LECTURE
OPPORTUNITY IDENTIFICATION AND SELECTION
MIDTERMS | S.Y 2022 – 2023
ALELI SAAVEDRA
OUTLINE
I. Idea Generation
A. Environmental Scanning
B. Pestle Analysis
C. Political Factors
D. Economic Factors
E. Social Factors
F. Technological Factors
G. Legal Factors
H. Environmental Factors
II. Selection and Screening
A. Personal-Level Screening
B. Firm Level Screening
III. Business Concept
A. Resource Analysis
B. Personal Values Analysis
I. IDEA GENERATION
IDEA GENERATION
● A sight or occurrence could bring about an
opportunity
● photos in the succeeding sliders are some
realities around us which could pose some
opportunities that await to be discovered.
○ Remember entrepreneurship is
innovation so how can we convert this
trash into an innovative product that will
not only help people in the community
but will enable you a very good business
opportunity.
○ There are still companies around the
world that continue to make money out
of providing unhealthy food to the
market.
● These pictures show some of the realities
around us, and based on our mindset, we can
either contribute to a solution, or we may be
adding to these problems that are already
existing.
DID YOU KNOW…
● In 1970, pet stones became a craze in America.
Gary Dahl is the creator, and he became a
millionaire.
● According to him, he cannot believe that by
simply selling pet stones for $3.95 each, he
became successful.
■ He got inspiration from listening to the
complaints of his friends from their pets.
Complaining about the hassle of taking
care of a pet.
■ Gary Dahl inspired to make a pet that
will not give you those hassles, yet you
will still have the same joy.
■ The creator saw a need and was very
smart in introducing to the market an
answer to a need.
○ People became interested and wanted
to buy the pet stone.
Link:
https://medium.com/illumination/the-story-of-a-genius-who
-became-a-millionaire-by-selling-stones-efdc9a3b91be
A. ENVIRONMENTAL SCANNING
● ENVIRONMENTAL SCANNING
○ It is a technical term in business
management and entrepreneurship,
which simply means that you have to
look around you or observe.
○ Use your five senses.
○ Understand the needs and wants of the
people.
■ Irritant, gap, dissatisfaction, or a
problem.
○ Identify the factors that could affect that
business opportunity that you have
identified.
B. PESTLE ANALYSIS
● PESTLE Analysis of business environment
○ Political
○ Economic
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 ○ Social
○ Technological
○ Legal
○ Environmental
● Conduct PESTLE analysis to determine how the
business is affected by these different factors in
the macro environment.
● These factors could either pose a threat or an
opportunity to that business concept that you
have identified.
C. POLITICAL FACTORS
POLITICAL FACTORS
● These are all about how and to what degree a
government intervenes in the economy
● This can include – government policy, political
stability or instability in overseas markets, foreign
trade policy, tax policy, labor law, environmental
law, trade restrictions and so on.
● What government programs are there that are
actually intervening by way of helping the
economy.
○ Do you see an opportunity or these are
threats to you?
○ Other government interventions in the
economy that you have to study there
and see how they can affect your
business or a concept
○ The government is very supportive of
entrepreneurs. In Philippines there are
agencies that are willing to help you:
DTI, DOLE OR DAR.
○ One Town, One Product - This is to
encourage a province or town to
maximize its resources especially
agricultural and come up with one
product that will make the town or
province known to everyone in the
country or even abroad.
D. ECONOMIC FACTORS
ECONOMIC FACTORS
● Have a significant impact on how an organization
does business and also how profitable they are.
Factors include – economic growth, interest
rates, exchange rates, inflation, disposable
income of consumers and businesses, and
so on.
● Inflation, unemployment, & foreign exchange are
factors that provide us a picture of how the
economy is in a particular country.
■ The high inflation we are already
experiencing it right now the goods,
basic commodities for that matter is very
high
■ May pakielam tayo kasi our purchasing
power is affected. We buy lesser when
the prices are very high.
■ If your product satisfying a certain need,
especially if it has something to do with
the ego of the market, they don’t care
about the price.
E. SOCIAL FACTORS
SOCIAL FACTORS
● Are the areas that involve the shared belief and
attitudes of the population,
● These factors include:
○ Population growth
○ Age distribution
○ Heath consciousness
○ Career attitudes; and so on.
● Place, preferences, culture, beliefs, behavior,
and attitude of people are very important
because these affect their buying decisions.
○ You look at the population of people,
distribution of age, and gender because
these affect the kind of products that
people demand for.
● There are other desires of people that can give
you an idea of what could be an opportunity.
● Millennials and GenZ companies are studying
youth because there are things that you prefer,
which are quite different from other GenX and Y.
● Companies are excited that this time, these are
the goals and services that are targeted to the
GenZ and Millennials.
● Some of the things we experience can be an
opportunity to produce services and products.
F. TECHNOLOGICAL FACTORS
TECHNOLOGICAL FACTORS
● Technological factors affect marketing and the
management thereof in three distinct ways:
○ New ways of producing goods and
services
○ New ways of distributing goods and
services
○ New ways of communicating with
target markets.
● When the business is already there, and
competition exists, companies will not really
survive in the long run if competitors keep on
upgrading themselves, and some companies are
not able to do that.
● Even if you are contemplating on this certain
business concept, being innovative in what
technology are you going to introduce into that
product c0or service
● If there are existing products or services, but you
still continue to complain about them, it just
means that you have an idea on how this product
or service can be possibly be improved using a
technology.
○ “Paano i-integrate ang technology na
‘yan sa product?”
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 G. LEGAL FACTORS sustainable company, carbon footprint target set
LEGAL FACTORS by governments.
● Include ○ How responsive is our product or service
○ Health and safety to “Sustainable Development”
○ Equal opportunities ● What is sustainable development?
○ Advertising Standards ○ It is growth without abusing people and
○ Consumer rights and laws the environment.
○ Product labeling; and ○ In establishing a business, you get some
○ Product safety materials from the natural environment.
● Ignorance of the law excuses no one. However, it must be done in a way that
● There are laws protecting entrepreneurs, and doesn't harm or put the environment at
there are laws protecting customers. And you risk.
have to be careful about that. You have to know ○ Should not cause scarcity of raw
that materials.
● Even in advertising your products, you have to ● When you have this concept, think about
study what laws that are protecting the market ○ Does it protect the environment?
when it comes to advertising a product. ○ Do you see that there is a threat to the
○ Laws such as: condition of the natural environment
■ The Consumer Act of the now?
Philippines ● In Portugal, people are suffering a lot from the
● Law where you can lack of water resources. They have an issue
read whether you can against Coca-Cola because while people in the
return items that are community do not have water to drink or to cook,
defective, how can you Coca-Cola has access to water. People felt that
complain against a they were at a disadvantage.
company, the product
safety. (These are all PRODUCT/SERVICE CONCEPT
part of the legal ● In your deliverable, these are the ideal process:
factors.) ● Given your chosen field and the United Nations
● Sometimes, even in Sustainable Development Goals:
acquiring resources for ○ Identify three persistent problems/needs
your business. (raw you experience or found in your
materials) because community.
there are many laws ○ Rank them, 1 as the highest
that you have to ○ Develop an innovation that can solve the
confront. #1 problem. Identify for whom
● Sardines manufacturing companies are specifically is the product/service.
sometimes not allowed to fish whenever they ● Many times, the solution already exists, but you
want because the government has assigned still continue to complain, which indicates that
schedules for them. something is lacking. So look into that. Why are
○ Example: Sardines from a certain month we still complaining?
bawal mangisda because we have to ● You have to understand how the product work
allow them (fishes) to multiply. During and how it can be developed.
those times, walang production and mga
sardine companies in the Philippines. II. SELECTION AND SCREENING
But it doesn't mean that you cannot see ● This is where we can make and find solutions for
the brands of the sardines in the market our business concept.
or grocery stores. It is still available ● In business management, this is how you screen
because they are able to project how out generated ideas.
much they need to produce that will fill ○ Market Feasibility
up even when there are times they are ■ "Aside from me, are there other
not allowed to fish. people complaining?"
■ "Is there a demand for this
H. ENVIRONMENTAL FACTORS product?"
ENVIRONMENTAL FACTORS ■ Market feasible means you
● They have become important due to the have enough customers that will
increasing scarcity of raw materials, pollution allow you to survive and have a
targets, doing business as an ethical and stable business in the long run.

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 ■ High demand in the market ○ Support of your family
○ Technical Feasibility
■ "Do you know how it goes or
works?"
■ "Is it doable? Pwede ba siyang B. FIRM LEVEL SCREENING
gawin?” FIRM LEVEL SCREENING
■ Awareness of the procedure Example 1: What opportunity is better?
and how to do it, or you know Criteria Weights Toy Making Food
some people who can produce (%) Business Business
it for you. Market demand 30 25 30
○ Financing Feasibility Technology 10 10 10
■ "Do you have sources of Availability of 10 5 8
funds?” Skills
■ "If you do not have your own Availability of 10 8 10
capital, do you have other raw materials
access for capital?" Financial or 20 15 17
■ "Do you think people or capital
companies are willing to provide requirements
you the capital?" Profitability 10 10 10
■ Because if your business needs Government 10 7 10
capitalization and you don't support
Total 100 80 95
have funds, it will limit you from
establishing or implementing ● These are some of the criteria for some
your business. companies.
■ It is very important that in ● It depends on the companies on what factors
screening out your ideas, they will use when choosing the business
financing feasibility is included opportunity.
so that you will know whether ● In companies, they have to have facts. Means,
you will have access to they have to spend on research. They need to
capitalization or not. have a big budget for research, especially for
○ Financial Feasibility studying the market.
■ "Will it allow you to earn?”
■ It will match with market III. BUSINESS CONCEPT
feasibility
A. RESOURCE ANALYSIS
■ When you do your financials,
● SWOT Analysis
you compute your income or
○ Strengths, Weaknesses, Opportunities,
make projections on how much
Threats
you are going to earn for the
● 7Ms (internal)
following years.
○ Money
■ If you see a very stable
○ Materials
increase in income, then go for
○ Machines
it. However, if you find your
○ Methods
projections at a loss, then scrap
○ Manpower
out that idea.
○ Management
■ Don’t include that idea for
○ Moment (time)
selection because your
● "Do I have the resources?"
projection for 5 years will tell
you if it is worth it or not.
● STRENGTHS
● Maximum of 5yrs,
○ What an organization excels at and what
separates it from the competition: a
A. PERSONAL-LEVEL SCREENING
strong brand, loyal customer base, a
PERSONAL-LEVEL SCREENING
strong balance sheet, unique
● Your choices are from
technology, and so on.
○ Your personal preference
○ When you have this material as your
○ Your education background
strength, meaning they allow you to be
○ Your work experiences
competitive and allows you to stand out
○ Your network of business contacts;
in the competition.
and

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 ○ However, if your business is new ○ For example, a drought is a threat to a
sometimes, you cannot say that you wheat-producing company, as it may
stand out from the competition. destroy or reduce the crop yield.
○ You cannot claim something as your ■ Other common threats include
strength if your competitors also have things like rising costs for
the same features, concept, or idea. materials, increasing
○ “Anong meron ka na wala talaga sa competition, tight labor supply
iba?” and so on.
● WEAKNESSES
○ They are areas where the business B. PERSONAL VALUES ANALYSIS
needs to improve to remain competitive: PERSONAL VALUES ANALYSIS
a weak brand, higher-than-average ● What is my guiding principle?
turnover, high levels of debt, an
inadequate supply chain, or lack of
capital.
○ Those that need improvement because
it does not allow you to be competitive.
○ higher-than-average turnover –
employees likely to resign or leave. This
is bad and costly.
○ Debt is not bad in itself for business.
Part of the financial management
strategy is borrowing.
○ Okay lang ang utang as long as it will
allow you to leverage. You are able to
maximize the use of borrowed funds.
○ Besides, when you borrow funds, you
only pay an affixed amount of interest,
while you are able to maximize the use
of that borrowed funds. You are able to
better the operations of your business
while paying an affixed amount of
interest. BUT it is a different story when
you are not able to pay.
■ Average turnover rate for all
employment is 3.5.
● (Kimberlee Leonard,
February 04, 2019)
■ Turnover Rate = Number of
Separations / Average
Number of Employees x 100
● Example: Three
employees have filed
their resignation in just
a week. What is the
turnover rate?
● OPPORTUNITIES
○ Refer to favorable external factors that
could give an organization a competitive
advantage.
○ For example, if a country cuts tariffs, a
car manufacturer can export its cars into
a new market, increasing sales and
market share.
● THREATS
○ Refer to factors that have the potential to
harm an organization.

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