Creating a Business Idea Week 5_ Part 1_ Looking for Opportunities MANGT 100 Section 2

Times of Oman Times of Oman on 9/2/2016 reported that more than half of Omanis remain jobless after graduating from colleges in the Sultanate, according to a survey conducted by the Ministry of Higher Education (MoHE). The survey was carried out among 12,551 students, who have been searching for jobs after graduating from their colleges. Half of all young Omani job-seekers needed three and a half years to find a job according to 2015 data released by the National Centre for Statistics and Information (NCSI). males find employment in less than two years, while females took up to four and a half years to get their first job  

Times of Oman “During my interviews with fresh graduates, I noticed that many struggle with speaking English and are not aware of the latest updates and news about their profession, which shows lack of interest,” Tawfiq said, The unemployment rate in Oman has reached 7.17 per cent, according to a new report by the International Labour Organisation, predicting that the number of unemployed people in the world will increase by nearly 2.3 million in 2016 and 1.1 million in 2017 as a result of the global economic slowdown last year.

Where do you find a business idea? Your hobbies (what you do for fun) Your needs Needs you see around you Opportunities created by change

What new ideas are being tried? How are other people turning their hobbies, interests, and needs into businesses? An interesting place to look is Kickstarter (www.kickstarter.com). It has hundreds of small businesses offering new products for sale. Some of the products are interesting, and some are just silly, but the site will show you the wide range of products people are creating.

Business Plan Questions What is the name of the business you would like to start? Describe the product you will sell or the service you will provide. Where will the product be sold or the service provided? How is your business different from existing businesses? Why would customers want your product or service? What problem does it solve? What opportunity does it create? Define their needs in detail. How important will this product or service be to your customers?

Business Plan Questions How much will your product or service cost? Why would customers be willing to pay that? Prepare a customer survey. Describe the customers you will approach to test this business idea. What characteristics make them likely to buy from you (age, income, interests)? Make a list of the questions you will ask them.

WHAT IS A BUSINESS MODEL The business model must answer the key question related to your business WHAT IS A BUSINESS MODEL Behind that KEY question is a lineup of other questions: Who's your target customer? What customer problem do you solve? What value do you deliver? How will you reach, acquire, and keep customers? How will you define and differentiate your offering? " " they " " " " " ? How will you generate revenue? How will you generate profit? What's your cost structure? How will you scale?

A Time for Innovation Some times foster more innovation than others. The key is change. Change produces needs and opportunities. Changes can be good, or they can be bad, but both produce needs and opportunities. (But good changes are better)

A Time for Innovation Change – the climate Needs – crops that need less water, barriers as ocean levels rise. Opportunities – companies that make water recyclers or new kinds of air conditioners should do very well.

A Time for Innovation Change – smart phones Needs – places to charge the phones, quick repairs, easy upgrades Opportunities – New apps, more games on-line, new information services

Examining change So many things are changing so constantly, that it is easy to ignore important changes that might provide an opportunity for your business. To help leaders review change carefully, they use a framework called “PESTLE”.

PESTLE PESTLE is an acronym (series of initial letters) for important areas of change: Political Economic Social Technological Legal Environmental A more formal way to look for business ideas is to use a common analysis method. PESTLE is an acronym for a step-by-step approach to reviewing the world around you as you look for business opportunities. “PESTLE” is the initial letters of six areas experts advise us to review for opportunities:   Political Economic Social Technological Legal Environmental In each case we are advised to look at current conditions, and to consider upcoming changes to see where we could find business opportunities

Political Change Political factors include: tax policy labor laws environmental laws trade restrictions Also, governments are consumers. They buy goods and services – sometimes more, sometimes less. They also create the infrastructure of a country – roads, ports, schools – Whole new port and city at Duqm The Omani government is investing in all these areas. The new port at Duqm will create a need for all kinds of new businesses – restaurants, shops, hotels – as well as major businesses to handle the flow of goods into and out of the port. The larger airport at Muscat should increase the number of international travelers coming to visit the country. The government is also improving roads across the nation. Better roads draw more travelers, and more travelers mean more consumers for business.

Political Opportunities Example – Oman has a good highway from Muscat to Nizwa. What opportunities would be created if the highway was improved all the way to Al Ain in the UAE? More traffic would likely lead to More gas stations More restaurants More customers in the Nizwa mall.

Political Opportunities Example – Oman supported the new University of Nizwa. What businesses have benefitted from the University? As a student in Nizwa, what needs do you see? What kinds of new businesses would students support?

Economic Change Economies change all the time – economic growth interest rates exchange rates the inflation rate Oddly, while most opportunities are found during times of economic growth, many new companies are started during slow downs.

Economic Change The price of oil has dropped by more than half. What does that do to the Omani economy? What are three consequences we will see in the local economy? Which businesses will be hurt? Is it possible any businesses will benefit?

Social Change Changes may be local, or they may be global. They may impact a small group, or nearly everyone. Look for changes in Culture Diets Population growth (or decline) Age distribution Career attitudes

Social Change One of the social changes in Oman is the large number of young people in the country. What businesses benefit from an increasing number of children?

Social Change Clothing styles also change. What kinds of opportunities are created when people change the kinds of clothing they wear?

Social Change Social change happens all around the world. If you sell on-line, you can reach customers anywhere in the world. How can you follow social changes in other countries?

Social Change Some countries export their culture. The U.S. has movies – Disney, Star Wars and tv shows. The UK had Harry Potter. Does Oman have any culture that it might export? TV? Movies? Books? How could you create a cultural export?

Business Ideas List 5 businesses you could create that would be possible because of Political changes Economic changes Social changes

Technological change Careful here. We tend to think only of computers. But these changes can include: New energy sources New drugs Communications improvements New ways of farming New ways of solving problems (robots, AI, big data) These have different impacts on consumers, employees, and companies

Technological change Industrial technology – as technology allows oil companies to remove more oil from the ground, it is likely oil and gas fields will produce for more years – maybe for more decades. The result will be oil and gas income for more years. How will that help Oman businesses?

Technological change Improved medicines have raised the life expectancy of Omanis from an average of 46 years to 71 years. As more Omanis live to an older age, what business opportunities does that create?

Technological change How many businesses have been created by cell phones in Oman? What kind of businesses are there?

Technological change On-line businesses – new markets Kickstarter website shows how to reach people around the world. How might we sell Halwa around the world? How might we sell dates? How might we sell Kahnjars? What else is special to Oman?

Legal Change Laws that might impact your business include: discrimination law consumer law antitrust law employment law health and safety laws (speed limits or food changes)

Legal Change “Omanization” is a good example of changed employment law. The government is urging companies to hire Omanis for jobs. Several businesses have been started to train and place Omanis in companies.

Environmental Change The environment can have huge impacts on all areas of business. But here we combine the actual changes with reactions to the changes in: Weather Climate climate change This summer was especially hot in the region. What business opportunities did that create?

Business Ideas List 5 businesses you could create that would be possible because of Technological changes legal changes Environmental changes

How an Entrepreneur looks at change What problems are emerging that people might want me to solve? What opportunities are now available that weren’t before? How important are those problems and opportunities ( do they really matter to people?) Can I meet the problem or opportunity at a cost the consumer will pay?

How PESTLE impacts business opportunities What restraints might impact my business from: Political changes – tax increases or labor law changes Economic changes – general down turn in the economy Social changes – customer interests come and go Technological changes – new technology might eliminate the need for my product or service Legal changes – new laws could make my business less attractive Environmental changes – drought could make farming impossible