Ideas and Innovation: Creating

ideas you can profit from

Tom Kalchik
Ideas and Innovation:
Creating ideas you can
profit from

Tom Kalchik, Assoc. Dir.

Michigan State University
Product Center
 MSU Product Center

 What it is
 Structure
– Strategic Marketing Institute
– Client Services
– Innovation Academy
 Process
– Three phase model

MSU Product Center for Agriculture and Natural Resources

 The Intuition about Process
 First, can you tell a plausible “fairy tale”
about the idea of the venture?
– Market/customer driven
– Internally consistent and appealing
 Then, can you reasonably make a profit
from the venture if everything goes well?
 Finally, can you “prove” to yourself and to
others the venture’s potential to work
(feasibility)?

MSU Product Center for Agriculture and Natural Resources

 What Is Needed to Launch a New
Venture?
 What is a New Venture?
– A New Business or a New Product/Service
 The Key Elements
– An Innovative Idea
– The Entrepreneurial Drive
– The Resources to Go to Market
 The Prerequisite for Success: A Business
Plan that Puts the Key Elements Together!

MSU Product Center for Agriculture and Natural Resources

 Entrepreneurship
 is a way of thinking, reasoning, and acting that is
opportunity obsessed, holistic in approach, and
leadership balanced.
 Habitual entrepreneurs – make a career out of
starting businesses, some working within existing
businesses and some in independent startups. All
have in common finely honed skills in forging
opportunity from uncertainty. (“The Entrepreneurial Mindset :
Strategies for Continuously Creating Opportunity in an Age of Uncertainty,” Rita
McGrath and Ian MacMillan, Harvard Business School Press, 2000)

MSU Product Center for Agriculture and Natural Resources

  Month of March
 6 workshops
throughout the State

MSU Product Center for Agriculture and Natural Resources

 Agenda
 What makes an idea unique, marketable and
profitable?
 Does the idea match what consumers want today?
 What does it take to be an innovative
entrepreneur?
 How do you take a new and unique idea to
market?
 Are you ready to take the first step?

MSU Product Center for Agriculture and Natural Resources

 What makes an idea unique,
marketable and profitable?
 Differentiation
 Customer segmentation
 Supply chain issues
 Creating differentiated products
 Sources of differentiation
 Means of creating differentiation

MSU Product Center for Agriculture and Natural Resources

 Creating Differentiation
Means Physical Perceptual Service Supply Chain
Source Change Change Change Change
Quality X
Functionality X
Form X X
Place X X
Time X X
Ease of
X
Posession

MSU Product Center for Agriculture and Natural Resources

 Does the idea match what consumers
want today?
 The Drivers – key functionalities
– Wellness
– Indulgence
– Convenience
– Value
– Ethnicity
– Demographics

MSU Product Center for Agriculture and Natural Resources

 What does it take to be an innovative
entrepreneur?
 Definition
 Inventory of ideas
 Paradoxes
 Myths and Realities
 Entrepreneurial test-self assessment

MSU Product Center for Agriculture and Natural Resources

 Who can be an entrepreneur?

 Anyone who wants to experience the deep,

dark canyons of uncertainty and ambiguity;
and who wants to walk the breathtaking
highlands of success. But caution, do not
plan to walk the latter until you have
experienced the former.
Quote from an entrepreneur

MSU Product Center for Agriculture and Natural Resources

 Create your
own inventory
of ideas
NOW
MSU Product Center for Agriculture and Natural Resources
 Paradoxes

 An opportunity with no or very low

potential can be an enormously big
opportunity
 To make money you have to first lose
money
 To create and build wealth one must
relinquish wealth

MSU Product Center for Agriculture and Natural Resources

 Technology Year Developed Years to Reach 25% of
US Population
Household Electricity 1873
Telephone 1875
Automobile 1885
Airplane Travel 1903
Radio 1906
Television 1925
Videocassette Recorder
1952
Personal Computer 1975
Cellular Phone 1981
World Wide Web 1990
Source: Wall Street Journal
MSU Product Center for Agriculture and Natural Resources
 Myths and Realities

 Anyone can start a business

– Must recognize difference between an idea and
an opportunity
– Luck requires preparation
– Easy to start
– Hard to survive, sustain and build a venture

MSU Product Center for Agriculture and Natural Resources

 Myths and Realities

 Entrepreneurs are gamblers

– Successful entrepreneurs take careful, calculated
risks
– Get other to share risks with them
 Entrepreneurs want to run the whole show
– High potential entrepreneurs build a team, an
organization, a company

MSU Product Center for Agriculture and Natural Resources

 How do you take a new and unique
idea to market?
 You’ve got the unique, marketable,
innovative idea!
 You’ve got the entrepreneurial drive!
 Now, how do you get the idea to market
– Gather the resources
– Put them into action
– The Prerequisite: A Business Plan
• A three-phase process!!!

MSU Product Center for Agriculture and Natural Resources

 Are you ready to take the first step?

 The Challenge
 Will the idea work?
 How do I get started?
 Working time with counselor

MSU Product Center for Agriculture and Natural Resources

 The Challenge You Face
 To systematically turn a business or product idea
into a real start-up or launch.
 Desire often overwhelms reason.
– The glory of the idea
• “Build it and they will come.”
• “Everyone will want it.”
• “It’s the greatest thing since sliced bread.”
– Missing the logical flow of development
• Operational detail before concept/strategy development
• Production before marketing
• No consideration of the real return potential

MSU Product Center for Agriculture and Natural Resources

 Results
 336 participants
 Average of 23 years of business experience
 Average of 14 years in current business
 Average of 62 miles traveled to attend
 Usefulness of program – 4.15 out to 5
 Met expectations – 4.28 out of 5
 Improved understanding – 4.13 out of 5
 70 new projects started

MSU Product Center for Agriculture and Natural Resources

 Future Program

 More details on idea generation

 More information on business planning

MSU Product Center for Agriculture and Natural Resources

MSU Product Center for Agriculture and Natural Resources