OPPORTUNITY

IDENTIFICATION
PREPARED BY: RONNEL A. COMPAYAN BSECE II-7
OPPORTUNITY IDENTIFICATION

 It is a screening process that involves responding to question that can shed light on
the potential for the idea to actually become a product or service upon which a
business can be established.

 Opportunity Identification process enables groups or individuals to screen a large

volume of ideas quickly and methodically.

 The process identifies high potential ideas to rise by allowing weak ideas to fail
quickly and inexpensively, on paper instead of in the lab or the real world.
PROCESS ARE DESCRIBED AS
FOLLOWS.
 Step 1.When the idea becomes reality in the form of a product or service, how
will this new product or service differ from what the market already has. The next
issue is how will the product or service create value for the buyer or end user.
What, exactly, is known about the buying behaviours of the market place?

 Step 2. Provided there is adequate demand for the product or service, the next step
provides a greater depth of understanding regarding the new ventures creation.
Figure 4.3.2 outlines the question that need to be addressed to estimate three key
success factors: time, money, and risk.
 Step 3. This step demands detailed analysis of the production/manufacturing
process or how the services will be rendered. This step will address the concern
adequacy of the production, product quality and standards, and cost
competitiveness.

 Step 4. Knowing the production costs and processes, the entrepreneur must be
able to estimate the initial total costs for the new venture.

 Step 5. The entrepreneur should be able to have a feel to an honest estimate of all
the risk involved in the business.
 FIGURE 4.3.1 The opportunity
evaluation process- step 1
New product How do these What are the How can these Based on the analysis of Characteristic
product characteristics potential barriers to barriers to adoption be the product and market
create value for the adoption of the overcome? acceptance, what can be
potential buyer or end product? concluded about
user? How can other companies
overcome similar adoption
barriers? The potential demand for the
new product?
What steps can be taken to The nature, characteristic, and
overcome the barriers? behaviours of early adopters?
The anticipated length of time
before product demand creates
adequate revenues and the
product has a recognized place
in market?
 Enhance and/or Lower cost
performance

Active orientation
Short decision windows
Risk management Revolutionary with short
Limited decision duration.
constituencies
 Example include

 Radically different product.

 Not easy to operate.
 Lack of training in use of the product.
 A market that is traditionally show to adopt new product.
 Adoption makes other equipment or systems obsolete.
 Adoption involves a great deal of risk for the adopter if the product fails to
perform.
 Figure 4.3.2 The opportunity evaluation
process-Step 2
Time Technical Risk Competitive Risk
How long will it take to get the Level of technical risk associated
ideas through the product with the product development 1. What is the probability that
development phase and process, that is, probability that competitors are developing
Target
product a “market-ready” the final product will perform as a similar or superior product?
Market
product? expected. 2. What has been the success
For the
Financial rate Product
in new product
Investment Financial Risk development for these
competitors?
1. How much will the product development 3. What is the depth of financial
phase cost? support for the competitor’s
2. How much will it cost to create and maintain the business new product development and
to support the new product? market introduction?
3. How much will it cost to produce an adequate quantity 4. What existing market advantage do
to reach the market? competitors presently have, that is, establish
distribution system, national sales force,
established relation with the market.