TECHNOLOGY ENTREPRENEURSHIP

(ENT600)

UNIT 3:

OPPORTUNITY ANALYSIS

Entrepreneurship Dept/FBM (2009) ENT600/Unit 3 Opportunity Analysis 1

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 Definition of
Entrepreneurial Opportunity

• Opportunities are an integral component

of the entrepreneurial process.

• Entrepreneurial opportunities are defined

as situations in which new products,
services and processes can be introduced
and sold at greater than the cost of
production.

Entrepreneurship Dept/FBM (2009) ENT600/Unit 3 Opportunity Analysis 3

 Concept of
‘Window of Opportunity’

• Often when referring to opportunities, the term

“window of opportunity” is used.
• The entrepreneur must hit the “window of
opportunity” for which the opportunity exists.
• Window of opportunity is defined as that too
often short period of time during which an
opportunity must be acted on or missed.
• It also describes the time period in which a firm
can realistically enter a new market.
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 Cont…
Concept of ‘Window of Opportunity’

• The “window of opportunity” is deemed to be “open”

or “close” to denote the degree of attractiveness or
exploitation possibilities at a particular time.
• The term “open” refers to the opportunity lending
itself to be exploited at that time because it has value
and potential for wealth creation.
• The term “close” refers to the opportunity potential
diminishes due to it being exploited by another
entrepreneur or at that period of time has become
out-of-date or obsolete.

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 Changing Opportunity – An Example

• Data storage in the computing age is essential to

the user. Data storage in the early years of
desktop computing, the diskette was the key
mode of data storage.
• As time passes, the user looks to more storage
capacities in a more stable form and much more
compact design. Hence, the introduction of the
pen drive or thumb drive fulfills the new needs
of the growing user group.
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 OPPORTUNITIES IN CYBER ENTREPRENEURSHIP

• Unlimited on-line opportunities

Examples:
• Web designing
• Web hosting
• On-line business
• Cyber business- eg. maintenance services and
accessories
• Using social media for business - e.g Twitter or
Facebook, Instagram
• On-line market places
• Training and consultancy
 CHARACTERISTICS OF AN
ATTRACTIVE OPPORTUNITY

1. Timely
- a current need, unmet demand or problem (e.g.
vaccine for bird flu, drugs to prevent obesity).

2. Solvable
- a problem that can be solved in the near future with
accessible resources (e.g. a cure for cancerous
diseases, a more efficient public transport to reduce
congestion and traffic jams)

Entrepreneurship Dept/FBM (2009) ENT600/Unit 3 Opportunity Analysis 11

 Cont…
Characteristics of an Attractive Opportunity

3. Important
– The customer deems their problem or need important to them
(e.g. energy-saving air conditioner or petrol saving devices
that work).

4. Profitable
– the customer will pay for the solution and allow the enterprise
to profit (e.g. security products, multi-function printers).

5. Context
– a favorable regulatory and industry situation (e.g. on-line
business transaction, genuine investment schemes that
promised high returns).
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OPPORTUNITY ANALYSIS – A PROCESS APPROACH

Opportunity Evaluate the

Discovery Opportunity

Go Technology-
Decision based Idea
Blueprint

Reject
Exploitation
Look of
Elsewhere Opportunity

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 OPPORTUNITY DISCOVERY
Sources of business ideas include:

• Patent Office
The Intellectual Property Corporation of Malaysia (MyiPo) is an
agency under the Ministry of Domestic Trade, Cooperative and
Consumerism. This agency can be a good source of business ideas
that can be retrieved easily from their online patent search and
patent gazette hosted on its website.

• University Research & Development

Provides an endless stream of research findings that can be
commercialized. Local universities play an important role in
providing knowledge that will help businesses grow into new market
segments and develop new products.

Entrepreneurship Dept/FBM (2009) ENT600/Unit 3 Opportunity Analysis 14

 Cont…
Opportunity Discovery

• Research Institutes
Considered as reliable sources of business ideas on
various fields. Examples of research institutes in
Malaysia include the Malaysian Agricultural Research &
Development Institute (MARDI), Standards and
Industrial Research Institute of Malaysia (SIRIM).

Entrepreneurship Dept/FBM ENT600/Unit 3 Opportunity Analysis

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 Opportunity Pull (Market Driven)
vs
Capability Push (Technology Driven)
Opportunity can either be:
• Opportunity Pull (Market Driven)
Occurs when there is a need or problem that requires a solution.
An example is the need for a pharmaceutical that can mitigate
or cure the effects of AIDS. This type of opportunity can be
called opportunity pull, since the size of the opportunity draws
opportunity seekers to attempt to exploit it.
• Capability Push (Technology Driven)
Occurs from the discovery of a capability or resource that can
be applied to a problem or need. An example of this type of
opportunity is the discovery of a new technology, such as digital
television. This type of opportunity can be called a capability
push, since it flows from a capability or resource availability.
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 EVALUATE THE OPPORTUNITY

• Evaluating opportunities involves internal and

external factors.
• Internal factors relate more to the
entrepreneurial individual capabilities and
intentions.
• External factors relate to the company and
business environment.

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 Cont…
Evaluate the Opportunity (Internal Factors)

Internal factors (Strength/Weaknesses) that include:

• Capabilities
 the ability or quality (knowledge, experience, and
skill) necessary to develop the business venture.
• Resources
 include financial, physical, and human resources
consistent with the magnitude of the business
venture.
• Interest
 the will, commitment, and passion to pursue the
business venture.
Entrepreneurship Dept/FBM (2009) ENT600/Unit 3 Opportunity Analysis 19
 Evaluate the Opportunity (External Factors)

External factors (Opportunities/Threats)

include:
• Market
 involves determining the size of the market and
the potential customers.
• Financial
 involves determining the costs to be incurred in
developing the business venture.
• Technical
 involves determining the requirements to proceed
with the idea that include machineries, raw materials,
the processes ENT600/Unit
Entrepreneurship Dept/FBM (2009)
and infrastructure.
3 Opportunity Analysis 20
 Cont… (external factors)
Evaluate the opportunity

• Economic forces
 Have a direct impact on the level of disposable
income and consumer buying patterns. For e.g.
when incomes are high, people are more willing to
buy products and services that enhance their lives.
 Similarly, a drop in interest rates typically leads to
an increase in new home construction and furniture
sales.

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 Cont… (external factors)
Evaluate the opportunity

• Social and Cultural Trends

 an understanding of the impact of social and cultural trends
and how they affect new product, service, and business ideas
is a fundamental piece of the opportunity recognition puzzle.
 For example, the persistent proliferation of fast-food
restaurants is not due primarily to people’s love of fast food
but rather to the fact that people are busy – the increasing
predominance of two-income households leaves less time to
cook at home. Similarly, the Sony Walkman was developed
not because consumers wanted smaller radios, but because
people wanted to listen to music while on the move and
while exercising.

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 Cont… (external factors)
Evaluate the opportunity

• Technological Advances
 provide opportunities to help people satisfy basic needs and
desires in a better or more convenient way.
 For e.g. the cell phone provides the mobile population the ability
to communicate with its co-workers, customers, friends, and
families from anywhere and everywhere.
 Similarly, people who shave have always wanted to minimize the
number of nicks and shaving time and get as close a shave as
possible. These and other shaving-related desires will probably
never change. What does change is the degree to which new
technologies can better satisfy these needs and desires.
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 Cont… (external factors)
Evaluate the opportunity

• Political and Regulatory Changes

– New regulations create opportunities for entrepreneurs to
start firms to help companies comply with these laws.
– E.g. OSHA standard, has opened up business
opportunities for consulting companies to help other
companies ensure compliance.
– Political change also leads to new business and product
opportunities.
– E.g. global political instability and the threat of terrorism
have resulted in many firms becoming more security
conscious.
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 ..\SWOT ANALYSIS.pptx
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 Feasibility Study

• The outcome of the evaluation of opportunity

is a feasibility study a tool to identify whether
the business idea is feasible or not.

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 Making Decision

• Once the opportunity is evaluated, a decision has to be

made whether to proceed to the preparation of a
technology-based idea blueprint or to explore other
possibilities by looking elsewhere.
• The entrepreneur must make a difficult decision whether to
act or not on a good potential opportunity.
• The factors to be considered in making the decision
include whether:
- the product will give significant value to the customer
- the entrepreneur can attract the necessary financial,
physical, and human resources required by the venture
opportunity
- the expected return of the venture is consistent with the
riskDept/FBM
Entrepreneurship of the(2009)venture
ENT600/Unit 3 Opportunity Analysis 27
 TECHNOLOGY-BASED IDEA BLUEPRINT

• This document summarizes the entrepreneur’s

proposal of a business venture.

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 EXPLOITATION OF OPPORTUNITY

Exploitation of opportunity for technological-

based product can be done through
commercialization.

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