BPA 2-1

CHAPTER
FIVE
Carmelotes, Nicole Y.
Lebores, Carol C.
Matigas, Judy Grace J.
 Intended Learning
Outcomes
At the end of this presentation, students must have:

1. Differentiate the concepts of Ideas, Innovation,

and Opportunities; and

2. Understand the concept of Creating Value and

Value Proposition
Opportunities
Identification
This is an effective tool to steer numerous ideas from a broad
range of perspectives. It has a collection of three main factors,
which are the entrepreneur’s background, the business
influence, and the general business environment.

Opportunities
Identification Process
Most entrepreneurs searching for new business ideas
fundamentally consider three central issues/processes.
• The main one is the potential economic value.

• The second one is the newness of such a venture.

• The third one is the perceived desirability.

 Stages of Opportunity
Identification Process
Preparation Incubation
Preparation stage is the This involves the consideration
knowledge and experience of a concept or a specific
exercised just before the problem ordinarily not
opportunity discovery subjected to conscious or
process. formal analysis by a
businessman or his team.
Insight Evaluation
This stage occurs at the This involves full
moment a fundamental feasibility analysis of the
solution suddenly becomes ideas through all forms of
recognized unexpectedly. research instruments and
criticisms from relevant
businesses.

Elaboration
This stage exposes the
opportunity/ideas to external
analysis with the tedious and time–
consuming options selection, choice
decision and organization of
resources.
Ideas
Germination
This is the seeding stage of a new idea. It is the stage
where the entrepreneur recognizes that an opportunity
exists which can be explored and exploited to its best
potential.
Idea germination is like a seedling process, in which
ideas get planted into the mind of an entrepreneur. The
germination stage is the sowing stage of the creative
process.
Sources of Ideas
These sources help an entrepreneur develop a
unique idea for his new product/ service:
1. Consumers
2. Existing products and services
3. Distribution Channel
4. Government
• Government records and publications
• Government regulations
5. Research and Development (R&D)
Other possible sources of business ideas:

1. Books 6. Exhibitions
Idea germination starts when: (i) entrepreneur is very
interested in a particular subject or area, or (ii) of a 2. Radio 7. Experience
particular problem faced by people. 3. Internet 8. Brainstorming
4. Hobby 9. Surveys
5. Complaints 10. Mass media outlets
Product Advantages of
Innovation Product Innovation
1. Growth, expansion and gaining
It is the development of new products, changes in a competitive advantage
design of established products, or use of new
2. Brand switching
materials or components in the manufacture of
established products.

In a complicated, fast-moving world where brands

no longer dominate the conversation and
consumers now hold enormous sway, product
Disadvantages of
innovation matters because it is the common
language you and your customers still speak. Product Innovation
Product innovation can be divided into two 1. Counter effect of product innovation
categories of innovation: 2. High costs and high risks of failure
• Radical innovation which aims at developing a
3. Disrupting the outside world
new product; and
• Incremental innovation which aims at improving
existing products.
 01. 02.
Expansion Competition
The unique solutions you

4 reasons to
Successful innovation develop help differentiate your
begets more innovation, business among the
which by nature enables competition, giving a boost to
your business to scale
and grow. pursue your own revenue while
nudging the entire industry in

innovation as a
a positive direction.

03.
Customer
driver of 04.
Talent
Retention business Acquisition
success
Top-tier employees want to
Innovation helps ensure that work for businesses that are at
what you sell doesn’t become the innovative forefront of
irrelevant or stop meeting the their industries. That’s where
needs of your customers. the action, the learning, and
the opportunities are.
 Difference between Idea,
Opportunity, and Innovation
Idea Opportunity Innovation

~ ~
Ideas are solutions to
problems and are
important providing
creative spark for your
business.
Opportunities, on the
other hand, are something
(ideas, circumstances,
situation.) that can lead to
a desirable and viable
business. These have
value.
According to Drucker
(1985), innovation is the
specific tool of
entrepreneurs, the means
by which they exploit
change as an opportunity
for a different business or
a different service.

The process of turning an idea into an TYPES OF INNOVATION

opportunity consists of the following:
• Organizational Innovation
• Strategic Fit • Process Innovation
• Business Plan • Marketing Innovation
• Team • Product Innovation
• Leadership
• Resources
 What is Value Creation?
Value creation is the primary aim of any business entity.
Creating value for customers helps sell products and
services, while creating value for shareholders, in the form
of increases in stock price, insures the future availability of
investment capital to fund operations.

Value Creation entails streamlining operations, refining

products, and promoting a culture of excellence. It comes
in various forms, tailored to meet the diverse needs of
stakeholders.
 Types of Value Creation
• Customer Value Creation
revolves around understanding and addressing customer needs,
problems, and desires.
• Economic Value Creation
this assessment treats a business as an investment that should
yield a specific return on the capital invested in it.
• Social Value Creation
a dimension of business that transcends profit and delves into the
positive impact a company has on society.
• Private Equity Value Creation
the evaluation of value creation often revolves around a
company’s enterprise value
• Innovation Value Creation
a pivotal driver of growth and competitiveness for businesses.
• Environmental Value Creation
a pivotal dimension of corporate responsibility and sustainability.
Importance of Value Creation
• Customer Satisfaction and Loyalty
lies at the heart of any business’s long-term success.
• Competitive Advantage
plays a central role in establishing a lasting
competitive advantage.
• Profitability
this is a natural consequence of effective value creation.
• Innovation and Adaptation
this is crucial to thrive in a dynamic and ever-changing business
environment.
• Shareholder Value Creation
this is an indispensable element of business achievement.
• Employee Engagement and Retention
this cotributes to an increased employee productivity and loyalty,
reducing turnover cost
Value Creation Model
Value Creation for Customers
Maximizing customer value begins with a thorough understanding of the
unique needs and preferences of high-value customers.

Understanding Convenience and

Customer Needs Accessibility Innovation

Product or Service Competitive Sustainability and

Quality Pricing Social Responsibility

Features and Customer Service Communication

Benefits and Support and Engagement

Feedback and
Personalization Trust and Reputation Improvement
 Competitive
Compensation and Benefits
Leadership Development Work-Life Balance
Career Development
Opportunities
Team Building and Recognition and
Collaboration Rewards

Fair and Ethical Treatment Value Creation Safe and Inclusive Work
Environment

Employee Engagement
for Employees Empowerment and
and Feedback Autonomy

Health and Wellness

Social Responsibility and Program Clear Communication and
Sustainability Feedback
Company Culture and Values

(Value creation for employees is essential for building a satisfied and engaged workforce.)
 Financial
Performance
Legal and Regulatory Capital Appreciation
Compliance Dividend Payments

Adaptability and Innovation Transparency and Disclosures

Market Position and

Competitive Advantage Value Creation Risk
Management

Return on Investment
for Investors
Sustainable Growth
(ROI)
Efficient Capital Allocation
Communication with Investors Effective Governance
Clear Strategic Vision

(Value creation for investors is a fundamental objective for any business as it directly
affects the attractiveness of the company’s investment proposition. )
Thank you
very much!