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2. Entrepreneurship and Business Management

3. Creativity and idea generation
Module 2

4. Think about it How does an entrepreneur identify an opportunity?
How do creativity, ideas and opportunities differ?
How can an entrepreneur protect a profitable idea?

5. Introduction

6. What is meant by creativity?
An enterprise always has to be creative and innovative so that it can survive in the market it is serving.
The enterprise constantly needs to come up with new ideas in order to remain competitive and satisfy the needs of its customers.
An enterprise has to identify opportunities before its competitors do so.
Figure 2.1: Creativity involves generating
or producing ideas

7. Ideas and opportunities

8. An idea becomes an opportunity when:
Customers will buy the product or service based on the idea.
There is still place in the market for the idea.
You will make a profit from the idea.

9. An idea only becomes an innovation if it can be put into practice
Figure 2.2: An idea becomes an opportunity if there is a demand for your idea (product or service)
Figure 2.3: An idea that is put into practice becomes an innovation

10. Innovation and creativity
Unit 2.2

11. Innovation
An innovation is the translation (conversion) of a new idea into a new product or a new service.
This new idea or product must have commercial value.
Ask yourself questions:
Will customers be willing to spend money on it?
Is it useful – does it solve a frustration or problem?
Does it give us power (a definite competitive advantage)?

12. Creativity
‘New’ does not necessarily mean brand new, but that something can be built on previous innovations.
You do not have to reinvent the wheel!
For example, you could:
Combine previously existing elements (e.g. a mobile phone + = BlackBerry).
Make something bigger or smaller (e.g. a laptop / tablet).
Offer something in a different form (e.g. music downloads instead of CDs).

13. Figure 2.4: A new product can be built on previous innovations

14. Activity 2.1
Test your knowledge of this section by completing Activity (page 16 of your Student’s Book)

15. Generating ideas
Unit 2.3

16. How can new ideas be generated?
Everyday activities.
Generic needs.
Other sources.

17. How can new ideas be generated?
Everyday activities:
Analyse existing products.
Analyse existing markets.
Socialise with people.

18. How can new ideas be generated?
Generic needs:
Analyse your own wants and needs.
Figure 2.6: Maslow’s hierarchy
of needs

19. Activity 2.2
Test your knowledge of this section by completing Activity (page 18 of your Student’s Book)

20. How can new ideas be generated?
Other sources:
Observe people.
Visit exhibitions, trade shows and flea markets.
Take note of news in the media.
Ask existing customers for opinions.

21. How can new ideas be generated?
Observe people:
This can be done where people gather, for example:
At the beach.
At clubs.
During meetings.
At work.
At public-transport places (train stations, taxi ranks, bus stops).

22. How can new ideas be generated?
Other sources
Visit exhibitions, trade shows and flea markets:
Many entrepreneurs first test their products at flea markets.
Trade shows are held regularly and normally have a specific theme.
Visit and observe the newest trends.

23. How can new ideas be generated?
Other sources
Take note of the news in the media:
The media includes printed media like magazines and newspapers, as well as television and the Internet.
Figure 2.7: The media can give you ideas for new products or services

24. How can new ideas be generated?
Other sources
Ask existing customers for their opinions:
Ask for feedback.
Feedback may indicate possible gaps and flaws in your initial idea.
Figure 2.8: Customer feedback could help you generate new ideas

25. VIDEO: HANG IN THERE!

26. Activity 2.3 – 2.4
Test your knowledge of this section by completing Activity 2.3 – (page 19 of your Student’s Book)

27. Methods of creativity
Unit 2.4

28. Existing concepts
Remember, ideas may become innovations, even though they are not brand new. A product can become new by:
Adding more attributes.
Changing the wrapping.
Making products either bigger or smaller.
Combining the functions of products.

29. Did you know?
You can use the SCAMPER method to change an existing product by asking the following questions:
S = substitute: Can other materials be used?
C = combine: Can I combine the product with another product?
A = amplify: What can be done to make the product more appealing to the public?
M = minimise: Can something or the product be made smaller?
P = put it to another use: Are there any other uses for the same product?
E = eliminate: What can be taken away?
R = rearrange: Can the colour, flavour, packaging, shape, size or texture be changed?

30. Activity 2.5
Test your knowledge of this section by completing Activity (page 20 of your Student’s Book)

31. Attribute analysis
Attribute analysis is the process of breaking down a problem, idea or thing into attributes or components and then thinking about the attributes rather than the whole.

32. Redefinition of the problem
Sometimes, the problem that has been defined is not the real problem, but merely a symptom (indication) of a deeper or bigger problem.
When redefining a problem, look at it from different points of view.

33. Finding a possible solution
Problem defined: Students are late for their classes.
Problem redefined: Students have transport problems.
Possible solution: Do research to determine the reasons for the transport problems.

34. Forced connections Forced connections are made by combining things.
You first have to define your problem.
Then brainstorm different keywords.
Start to combine these keywords to make new connections so that you can try to solve the problem.

35. Mind mapping
A method of illustrating ideas and indicating how they are related to one another.
The main idea is put in the centre of a diagram.
A second idea flows from the first idea.
A third idea and all the other ideas are always built on the first idea.
Figure 2.9: A mind map
on energy

36. Brainstorming
Brainstorming is a very popular method of coming up with ideas.
Ideas are put forward, but no evaluation or discussion of the ideas takes place.
Criticism is not allowed.
All these ideas are simply written down.
A full discussion and evaluation of these ideas takes place at another time.
Figure 2.10: Brainstorming ideas

37. Activity 2.6
Test your knowledge of this section by completing Activity (page 21 of your Student’s Book)

38. Metaphorical analogy
Metaphorical (or analogy) thinking involves comparing something with a totally unrelated topic.
It allows for abstract thinking.
Many ideas are generated from nature.

39. VIDEO: YOU NEED MORE THAN A GOOD BUSINESS PLAN

40. Activity 2.7
Test your knowledge of this section by completing Activity (page 22 of your Student’s Book)

41. Protecting your ideas
Unit 2.5

42. Means of protection
Coming up with a viable new idea that can be profitable can change your life forever.
But this will only happen if that idea is protected.
The following means of protection can be used:
Secrecy.
Patents.
Trademarks.
Copyright.

43. Secrecy
Draw up a contract of secrecy before disclosing any facts so that you can protect your idea.
A contract of secrecy is also known as a ‘non- disclosure contract’.
Figure 2.12: A contract of secrecy

44. Secrecy

45. Patents A patent is a right granted by the government to an inventor.
It gives the inventor the exclusive (sole) right, for a limited period.
When a patent is granted, the invention becomes the property of the inventor.
A patent can be bought, sold or licensed.

46. Trademarks
A trademark is a unique mark which distinguishes your goods or services from others.
It is very important that you register your product or service to make sure that the public does not confuse your product or service with those of your competitors.
A trademark must be renewed every 10 years to stay in force.
Figure 2.14: A registered trademark distinguishes your product from those of others

47. Copyright
Copyright is the exclusive right granted by law for a limited period to an author or designer for his or her original work.
The following works are eligible (can be protected) for copyright in South Africa:
Literary works.
Musical works.
Artistic works.
Cinematograph films.
Sound recordings.
Broadcasts.
Programme-carrying signals.
Published editions.
Computer programs.

48. Activity 2.8
Test your knowledge of this section by completing Activity (page 24 of your Student’s Book)

49. Turning ideas into opportunities

50. Identify good ideas
After you have generated ideas, you have to evaluate all the ideas.
You have to ask yourself questions like the following:
Do I have the necessary funds and contacts to put the idea into practice?
Is there a market for my idea?
Do I have the necessary knowledge and skills?

51. Identify opportunities
Two critical questions can be asked:
Will it be worthwhile?
Will I make a profit?
Figure 2.16: Turning ideas into opportunities

52. This checklist could be used:
Is there a need to be fulfilled or a problem to solve?
Who will be my target market?
Will it be possible to enter the market?
Will I make a profit?
How many competitors are there already in the market?
Will I still be able to capture a part of the market (a market share)?
What will my start-up costs be?
Where will I get the money to start my business?

53. Will I make a profit? At this stage just note the following:
GROSS PROFIT = SALES less COST OF SALES
NET PROFIT = GROSS PROFIT plus other INCOME less EXPENSES

54. Case study 2.1
Test your knowledge of this section by completing Case study (page 25 of your Student’s Book)

55. Turning ideas into opportunities for your small business

56. Activity 2.9 – 2.10
Test your knowledge of this section by completing Activity 2.9 – (page 25 of your Student’s Book)

57. The business plan
Unit 2.8

58. VIDEO: AS LONG AS YOU HAVE A MARKET, YOU’LL BE OK

59. Activity 2.11
Test your knowledge of this section by completing Activity (page 26 of your Student’s Book)

60. Summative assessment
Test your knowledge of this section by completing the Summative assessment (page 26 of your Student’s Book)