Developing Entrepreneurial creativity and innovation Chapter 3 Villa College

Chapter outline Part I What is Creativity? Process of Creativity Barriers to Creativity How to generate creative ideas? Characteristics of creative individual Villa College

Entrepreneurial Creativity – Five action areas Villa College

Entrepreneurial Leadership Villa College

Creativity, Innovation & Entrepreneurship Villa College

‘Creativity’ A "new" idea is a combination of old elements. ‘It is your ability to combine ideas in a unique way or to make useful associations among ideas.’ "There is virtually no problem you cannot solve, no goal you cannot achieve, if you know how to apply the creative powers of your mind, like a laser beam, to cut through every difficulty in your life and your work." Villa College

Don’t believe in experts!!!!!!!!!! “TV will not be able to hold onto any market it capturers after the 1st six months. People will soon get tired of staring into a box every night” - Daryl F. Zanuck, head of 20th Century Fox in 1946 “That’s an amazing invention. But who would ever want to use one of them?” - US President Rutherford B. Hayes after participating in a trial tele-converation between Washington & Philadelphia in 1876 Villa College

The Whats What is it? What are the components? What is the process? What stops it? What helps it? What are the steps to develop? Villa College

‘Creativity’; “the ability to bring something new into existence” “involves the development of UNIQUE & NOVEL responses to problems / opportunities” “ability to combine ideas in a unique way” “the ability to make or otherwise bring into existences something new, whether a new solution to a problem, a new method or device, or a new artistic object or form” “new and useful” Villa College

‘Creativity’; Creative solutions are more than ideas, they must work in the real world. A creative solution has 3 attributes, It is NEW It is USEFUL, in that it solves the problem It is FEASIBLE, given the messy real world constrains like time & money Villa College

‘Entrepreneurial Creativity’ can be defined as ; coming up with innovative ideas and turning them into value-creating profitable business activities Entrepreneurial creativity = creativity × entrepreneurial action Villa College

Some Well known definitions ‘Creativity involves development of unique & novel responses to problems & opportunities’ – Schermerhom, Hunt & Osborn, 2003 ‘Creativity is the ability to produce work that is novel, high in quality and appropriate’ - Sternberg, Kaufman & Pretz, 2002 Villa College

Why Creativity is essential for Entrepreneurs? It’s the starting point of invention or spotting an opportunity Creativity provides entrepreneurs to develop an ability to see, recognize & create opportunities where other find only problems Let entrepreneurs to analyze a problem from every possible angle Essential for survival, growth expansion & most importantly for building competitive advantage Villa College

From ‘Creativity’ to ‘Innovation’ Villa College

Entrepreneurial Creativity in Individuals Villa College

Components of Creativity Villa College

The Process of Creativity Incubation Creative Process Knowledge Accumulation Ideas Evaluation & Implementation Villa College

Creativity & creative thinking Bringing into existence an idea that is new An innate talent that you were born with OR a set of skills that can be learned, developed and utilized in daily problem solving Creative thinking Villa College

Barriers to Creativity Personal Beliefs Fear of Criticism Barriers to Creativity Stress Over-Management Villa College

Blocks & Blockbusters to creativity Making assumptions Check assumptions Following the rules Breaking the rules Villa College

Blocks & Blockbusters to creativity Over reliance on logic Using imagination & intuition Fear of failure Risk taking culture Villa College

Conceptual Blocks Mental obstacles that constrains the way the problem is defined & limit the number of alternative solutions thought to be relevant Conceptual Blocks Villa College

Lateral Thinking ‘Lateral thinking’ is concerned with generation of new ideas. It is also concerned with "breaking out of the concept prisons of old ideas.” Villa College

Vertical Vs. Lateral Thinking Vertical Thinking Lateral Thinking Chooses Changes Looks for what is right Looks for what is different One thing must follow directly from another Makes deliberate jumps Concentrates on relevance Welcomes chance intrusions Moves in the most likely directions Explores the least likely directions Villa College

Unlocking your Creativity – get away from ‘old’ ideas by Brian Tracy Admit when you are wrong Face up to mistakes Be flexible with new information Be willing to cut your losses Villa College

5 Rules of Creative Thinking Don't let assumptions stifle your capacity Discipline yourself to take time to look for alternatives To get solutions, you must create an atmosphere where you and others are comfortable expressing new ideas (even if you make mistakes by coming out with bad ideas), an atmosphere where ideas are not immediately evaluated and attacked To open up true creativity, you have to shed inhibitions and move from left-brain – dominated by numbers toward right- brain  – the original thinking If you are working on a problem and getting nowhere, leave it for a while and let your subconscious – your depth mind – to take over Villa College

Characteristics of Creative Individuals Remarkably humble & proud at the same time Passionate about their work, yet can be extremely objective about it Brave to try new things Open minded & willing to accept criticism Have a combination of playfulness & discipline or responsibility & irresponsibility Have high self-control Goal directed, deliberate & considerate in making any decision Willing to take calculated risks Villa College

Techniques of generating creative ideas Brainstorming Forced Analogy Do It Mind Mapping Nominal Group Villa College

Mind Map Villa College

The Six Thinking Hats The Six Thinking Hats proposal analysis tool invented by Edward de Bono is particularly useful for evaluating innovative and provocative ideas The method is a framework for thinking and can incorporate lateral thinking The Six Thinking Hats tool: encourages Parallel Thinking encourages full-spectrum thinking separates ego from performance. Villa College

Each 'Thinking Hat' is a different style of thinking Villa College

White Hat With this thinking hat you focus on the data available. Look at the information you have, and see what you can learn from it. Look for gaps in your knowledge, and either try to fill them or take account of them. This is where you analyze past trends, and try to extrapolate from historical data. Villa College

Red Hat 'Wearing' the red hat, you look at problems using intuition, gut reaction, and emotion. Also try to think how other people will react emotionally. Try to understand the responses of people who do not fully know your reasoning Villa College

Black Hat Using black hat thinking, look at all the bad points of the decision. Look at it cautiously and defensively. Try to see why it might not work. This is important because it highlights the weak points in a plan. It allows you to eliminate them, alter them, or prepare contingency plans to counter them. Black Hat thinking helps to make your plans 'tougher' and more resilient. It can also help you to spot fatal flaws and risks before you embark on a course of action. Black Hat thinking is one of the real benefits of this technique - many successful people get so used to thinking positively that often they cannot see problems in advance. This leaves them under-prepared for difficulties Villa College

Yellow Hat The yellow hat helps you to think positively. It is the optimistic viewpoint that helps you to see all the benefits of the decision and the value in it. Yellow Hat thinking helps you to keep going when everything looks gloomy and difficult Villa College

Green Hat The Green Hat stands for creativity. This is where you can develop creative solutions to a problem. It is a freewheeling way of thinking, in which there is little criticism of ideas. Villa College

Blue Hat 'Blue Hat Thinking' stands for process control. This is the hat worn by people chairing meetings. When running into difficulties because ideas are running dry, they may direct activity into Green Hat thinking. When contingency plans are needed, they will ask for Black Hat thinking, etc.. Villa College

Chapter outline Part II What is Innovation? Types of innovation Sources of innovation Barriers innovate Development of innovation & creativity Villa College

Invention Vs. Innovation – synonyms???? ‘An invention is a new configuration, device, or process’ is the creation of new products, processes, and technologies not previously known to exist Innovation ‘An innovation is associated with the development of a new or better product or process is the transformation of creative ideas into useful applications by combining resources in new or unusual ways to provide value to society for or improved products, technology, or services Doing things differently Villa College

Invention Vs. Innovation – synonyms???? Extreme end of a development of a new product or process Associated with the development of a new or better product or process All inventions are not commercially viable Innovations are more commercially viable A product of ‘research’ More than just invention Villa College

Innovation defined……… ‘The means to break away from established patterns’ - Henry Mintzberg (1983) ‘The specific tool of entrepreneurs, that means by which they exploit change as an opportunity for a different business or different service’ - Peter Drucker (1985) ‘The prime tool entrepreneurs use to create or exploit opportunities - Michael Porter (1990) Villa College

Creativity & Innovation Bringing into existence an idea that is new Innovation The practical application of creative ideas Villa College

The relationship?????? “Creativity is the starting point whether it is associated with invention or opportunity spotting. The creativity is turned into practical reality (a product) through innovation. Entrepreneurship then sets that innovation in the context of an enterprise (the actual business)which is something of value” - Bolton & Thompson (2000) Villa College

Relationship between innovation & Entrepreneurship The Struggler The Innovator The Stagnator The Copier High Innovation & Creativity Low Low High Entrepreneurship Villa College Source : Entrepreneurship & Small Business – Paul Burns

The Value of Innovation The balance between adapting and revolutionizing Villa College

The Process of Innovation Opportunity Delivery of Innovation Opportunity evaluation Innovation Villa College

Types of innovation Villa College Invention Extension Duplication Synthesis Villa College

7 Sources of Entrepreneurial Opportunities for innovation by Drucker Internal The unexpected – the unexpected success, the unexpected failure, the unexpected outside event The incongruity – between reality as it actually is and reality as it is assumed to be or as it “ought to be” Innovation based on process need; any inadequacy in a business process that is taken for granted Changes in industry structure or market structure that catch everyone unawares   External Demographic changes caused by things like wars, migrations, medical developments Changes in perception and fashion brought about by changes in the economy Changes in awareness caused by new knowledge Villa College

Do’s & don’ts on innovation by Peter Drucker Analyze the opportunities Go out to look, to ask, to listen Keep it simple, keep it focused Start small – try to do one specific thing Think big – aim at market leadership DON'Ts Don't try to be too clever Don't diversify, don't splinter, don't try to do too many things at once Don't undershoot, or you will simply create an opportunity for competition Don't try to innovate for the future Villa College

5 stage approach to purposeful, systematic innovation by Peter Drucker Start with the analysis of opportunities (inside the firm & its industry & in the external environment) Look at the financial implications, but also talk to people, particularly customers & analyze how to meet the opportunity An innovation must be simple & has to be ‘focused’ To be effective, start small. Take an incremental approach Aim at leadership & dominate the competition as soon as possible in the particular area of innovation Villa College

Blocks and Limiting Beliefs Switch To Positive Attitude What prevents people from being creative or innovative? Adapted from Effective Innovation: How to Stay Ahead of the Competition, John Adair Barriers Blocks and Limiting Beliefs Switch To Positive Attitude Negative Attitude The tendency to focus on the negative aspects of problems and expend energy on worry. Seek the inherent opportunities in the situation. Fear of Failure Fear of looking foolish or being laughed at. Failure is a necessary condition of and a stepping stone to success. Executive Stress Not having time to think creatively. The over- stressed person finds it difficult to think objectively at all. Unwanted stress reduces the quality of all mental processes. Managing day-to-day operations is important, but it is new game changing breakthroughs that will launch company into new markets, enable rapid growth, and create high return on investment. Following Rules A tendency to conform to accepted patterns of belief or thought – the rules and limitations of the status quo. Some rules are necessary, but others encourage mental laziness. "Every act of creation is first of all an act of destruction." – Pablo Picasso Making Assumptio ns Many both conscious and unconscious assumptions restrict creative thinking. Identify and examine the assumptions you are making to ensure they are not excluding new ideas. Challenge assumptions. Over- reliance on Logic Investing all your intellectual capital into logical or analytical thinking – the step-by-step approach – excludes imagination, intuition, feeling or humor. "Innovation is not the product of logical thought, although the result is tied to logical structure." – Albert Einstein Villa College

Barriers to Innovation Organizational Personal or Individual Villa College