Entrepreneurship and Innovation Third Assignment

Submitted by: Ashtha Karki Term 4, MBA

Submitted to: Mr. Rupesh K. Shrestha (Course Facilitator)

May 10th, 2010

External sources of innovative opportunity can be demographics, changes in perception, meaning, and mood and new knowledge. They include the changes in the social philosophical, political and intellectual environment. Changes in population, size, age structure, composition, employment, educational status and income are included in demography and it has a major impact on what will be purchased, by whom and in what quantities. For instance, chocolates are targeted and advertised mostly to youngsters in India as the population of youngsters is high there. The restaurant business is sustaining in Kathmandu because the number of number of people working in Kathmandu is high. The unwillingness, or inability, of the experts to accept demographic realities which do not conform to what they take for granted gives the entrepreneur his opportunity. In the given chapter in demographics it focused more on population its effects. It tries to show that changing demographics is both a highly productive and a highly dependable innovative opportunity. Perception differs from one person to the other. It signifies the difference in views among people. For instance, before some 7-8 years even Maruti car was considered something that a person could boat about. With many automobiles in the market like Skoda, Toyota, Nissan etc the perception of people towards Maruti has changed. Similarly, a certain race as a barber was considered a taboo but ladies also started working in saloons and it isnt considered bad but has been considered an innovative work. An organization can take a certain situation as its end but at the same time other organization can take the same situation as the turning point. When a change in perception takes place, the facts remain the same but their meaning changes. It depends upon the interpretation of people. But we have to identify whether perception is fad or permanent, and what the consequences really are, perception based innovation has to start small and be very specific.

Knowledge based innovation is the superior of them all. It gets publicity and money and making innovations based on knowledge is given a high value also. Social innovations based on knowledge can have equal or even greater impact. Knowledge based innovation is unpredictable, unreliable, challenging and hard to manage. They are also innovations having the longest lead time of them all. There is a long time span between the emergence of new knowledge and its becoming applicable to technology and then there is another long period before the new technology turns in to products processes or services in the market place. Knowledge based innovation requires careful analysis of all the necessary factors, whether knowledge itself or social, economic, or perceptual factors. The analysis must identify what factor are not yet available so that the entrepreneur can decide whether these missing factors can be produced or whether the innovation had better be postponed as not yet feasible. It also requires clear focus on the strategic position. There is three major focuses for

knowledge based innovation. To develop a complete system that would then dominate the field. There needs to be market focus. Knowledge based innovation can aim at creating the market for its products. The focus is to occupy a strategic position, concentrating on a key function. The knowledge based innovator has to decide on a clear focus as these focuses are very risky. The third requirement is the needs to learn and to practice entrepreneurial management. Its risks are high thus putting a much higher premium on foresight both financial and managerial, and on being market focused and market driven. Some bight ideas can fail at times and some ideas that people thing are unworthy do very well. For instance, Fair and lovely didnt go into the niche market thinking that men will not use the fairness cream but Emami came up with the Mens Active for men which made them a tough competitor for Fair and lovely. Gramin bank in Bangaladesh was thought to do very poor but it did excellently. It helped to raise the economic condition of the country to. Similarly, vanilla and ginger coke was a total failure in South Asia though the product was

innovative. However, every bright idea regardless of the success or failure should be appreciated. Innovations should be of such that they can fulfill the demand and desire of the customers even before they think about it. The innovations of iphone can be used as an example. The regular cell phone was modified and improved with various features in it so that the consumers would have easy access to the information and other things.