Chapter 5:

Creativity and Innovation

BY: JUDE MICHAEL CERENEO
(5TH YEAR STUDENT)
Opportunity Identification:

▶ It is the central to the domain of entrepreneurship

▶ “Entrepreneurship revolves around the questions of why, when and how
opportunities for the creation of goods services in the future arises in an
economy. Thus, opportunity recognition is the progenitor of both personal and
social wealth”
▶ The first step for any entrepreneur is the identification of a “GOOD IDEA”
▶ The most important areas to be aware of are within the grasp of our own
knowledge
Key Sources of Innovative Idea’s

Entrepreneurs must always be alert to the

opportunities that lie in the external and
internal environments in which they live
 Trends

Observing trends closely will grant an entrepreneur the ability to

recognize a potential opportunity. The following are some example
of trends:
▶ Societal Trends: Aging, Demographics, Health and Fitness growth, Senior Living

▶ Technology Trends: Mobile technology, e-commerce, Internet advances

▶ Economic Trends: higher disposable income, dual wage earner families, performance
pressures
▶ Government Trends: increased regulations, petroleum prices, terrorism
Unexpected Occurences

▶ These re success or failures that, because they were

unanticipated or unplanned, often prove to be a major
innovative surprise for everyone.
▶ (i.e. When there is a sudden rise in current temperature,
people would sell refreshments to counter the heat)
Incongruities

▶ This occur when a gap or difference exists between

expectations and reality.
▶ (i.e. when a person wanted to eat at midnight but was too
tired to leave the house, and that idea was used to develop
the 24\7 delivery)
Process Needs

▶ Occurs when an answer to a particular need is required.

▶ Considered as the “pain” that exist in the marketplace
▶ Entrepreneurs must develop “painkillers” which means products that
will ease the work of the people.
▶ (i.e. instant foods, sugar-free drinks, easy open packages)
Industry and Market Changes

▶ Industry and markets always undergo changes in structure, design

or definition.
▶ (i.e. people can now purchase medication at pharmacy to prevent
possible problems, where people cant from the past)
Demographic Changes

▶ There arises from trend changes in population, age, education,

occupation, geographic locations, and similar factors.
▶ (i.e. as universities are built in the city people who lives away have
to travel for hours to attend classes, that’s where apartments and
other rental houses profited)
Perceptual Changes

▶ Occur in people’s interpretation of facts and concepts

▶ They are intangible but meaningful
▶ (i.e. people post a lot of travel goals in the social medias, that’s
where travel packages bloomed)
Knowledge-Based Concepts

▶ Basis for the creation or development of something brand new

▶ Inventions are product of new thinking, new methods and new
knowledge
▶ (i.e. watches nowadays can be connected with Bluetooth and wifi,
or browse images through smart watches)
Entrepreneurial Imagination and Creativity

▶ It has been said that the first rule for developing entrepreneurial
vision is to recognize that problems are to solutions what demand is
to supply
▶ Entrepreneurs blend imaginative and creative thinking with
systematic, logical process ability. The combination to successful
innovation.
The Role of Creative Thinking

▶ Creativity is the generation of ideas that results in the improved

efficiency or effectiveness of a system.
▶ Two aspects of creativity exist: Process and People
▶ The process is goal oriented – designed to attain a solution to a problem
▶ The people are the resources that determine the solution
▶ The process remains the same, but the approach people use can vary, it
can be adaptive to the problem or innovative to the idea.
The Nature of the Creative Process

▶ Creativity is a process that can be developed and improved

▶ Everyone is Creative, However, as it is the case with many abilities and
talents, some individuals have greater aptitude for creativity than the
others.
▶ The real barrier for creative thinking are sometimes the inadvertent “
killer phrases” we use in our communication.
▶ Here is the list of the top 10 “Killers” we use:
▶ “Naah”
▶ “Can’t”
▶ “That’s the dumbest thing I’ve ever heard”
▶ “Yeah, but if you did that…”
▶ “We already tried that… years ago”
▶ “I don’t see anything wrong with the way we’re doing it now”
▶ “We’ve never done anything like that before”
▶ We’ve got deadlines to meet … we don’t have time to consider that”
▶ “It’s not in the budget”
▶ “Where do you get these weird ideas”
 The Creative Process has four commonly
agreed-on phases or steps

-these phases do not always occur in the same order every creative
activity
Phase 1: Background or Knowledge Accumulation

▶ Successful creations are generally preceded by investigation and

information gathering. This involves extensive reading,
conversation with others working in the field, attendance at
professional meetings and workshops, and a general absorption of
information relative to the problem or issue under study.
▶ People practice to creative search for background knowledge in a
number of ways:
Some of the most helpful are to:

▶ Read in a variety of fields

▶ Join professional groups and associations
▶ Attend professional meetings and seminars
▶ Travel to new places
▶ Talk to anyone and everyone about your subject
▶ Scan magazines, newspapers, and journals for articles related to he subject
▶ Develop a subject library for future reference
▶ Carry a small notebook and record useful information
▶ Devote time to pursue natural curiosities
Phase 2: The Incubation Process

▶ Creative individuals allow their subconscious to mull over the tremendous amount of
information they gather during the preparation phase.
▶ Incubation process often occurs while individuals are engaged in activities totally
unrelated to the subject or problem.
Some of the most helpful steps to induce
incubation are to:

▶ Engage in routine, “mindless” activities (painting the house, picking weeds)

▶ Exercise regularly
▶ Play sports, board games, puzzles and the like
▶ Think about the project or problem before falling asleep
▶ Meditate or practice self-hypnosis
▶ Sit back and relax on a regular basis
Phase 3: The Idea Experience

▶ This phase is often the most exciting, because it is when the idea or solution
the individual is seeking is discovered, sometimes referred to as “eureka
factor”
▶ It is often difficult to determine when the incubation process ends and idea
experience phase begins, many people are unaware of moving from phase 2 to
phase 3.
Following are the ways to speed up the idea
experience:

▶ Daydream and fantasize about your project

▶ Practice your hobbies
▶ Work in a leisurely environment
▶ Put the problem on the back burner
▶ Keep a notebook at bedside to record late-night or early-morning
ideas
▶ Take breaks while working
Phase 4: Evaluation and Implementation

▶ The most difficult step of a creative endeavor and requires a great

deal of courage, self –discipline, and perseverance.
▶ Entrepreneurs will take the idea in an entirely different direction or
will discover a new more workable idea while struggling to
implement the original one.
Some of the most useful suggestions for
carrying out this phase are to:

▶ Increase your energy level with proper exercise, diet and rest
▶ Educate yourself in the business-planning process and all facets of business
▶ Test your ideas with knowledgeable people
▶ Take notice of your intuitive hunches and feelings
▶ Educate yourself in the selling process
▶ Learn about organizational policies and practices
▶ Seek advice from others
▶ View the problems you encounter while implementing your ideas as challenges
Eliminating Muddling Mind-Sets

A number of mental habits block or impeded creative

thinking. Another inclination is to point out the negative
components of a new or different idea because of the
psychological discomfort associated with change.
Some common mental habits that inhibit
creativity and innovation

▶ Either\Or Thinking- creative person learns to accept a reasonable amount of ambiguity in his or
her work and life. In fact, many exceptionally creative people thrive in an uncertain environment
and find it exhilarating.
▶ Security Hunting – people rely in averages, stereotypes, and probability theory to maximize their
risk. Although this strategy often is inappropriate , at times a creator or innovator must take some
calculated risk.
▶ Stereotyping – People act and make decisions based on fabricated abstractions as if theses were
data entities that exist in the real world.
▶ Probability Thinking – Many people tend to rely on the theory of probability thinking to make
decisions. An overreliance on this method can distort reality and prohibit one from taking
calculated risk that may create endeavors.
Arena’s in Which People are Creative

▶ People often do not recognize when they are being

creative, and they frequently overlook opportunities to be
creative.
▶ The path to creativity begins by first recognizing all of the
ways in which we are or can be creative.
People can channel their creativity into seven
different arena’s :
▶ Idea Creativity – thinking up a new idea or concept such as an idea for a new product or
service or a way to solve a problem.
▶ Material Creativity – inventing and building a tangible object such as a product, an
advertisement, a report, or a photograph
▶ Organization Creativity – organizing people or projects and coming up with a
organizational form or approach to structuring things
▶ Relationship Creativity - an innovative approach to achieving collaboration, cooperation,
and win-win relationships with others.
▶ Event Creativity – producing an event such as an award ceremony, team outing, or annual
meeting. The creativity here also encompasses décor, ways in which people are involved,
sequence of happenings, setting and so forth
People can channel their creativity into seven
different arena’s :

▶ Inner Creativity – changing one’s inner self; being open to new approaches to
how one does things and thinking about oneself in different ways; achieving ac
change of heart or finding a new perspective or way to look at things that is
significant from how one has traditionally looked at them.
▶ Spontaneous Creativity – acting in a spontaneous or spur-of-the-moment manner,
such as coming up with a witty response in a meeting, an off-the-cuff speech, a
quick and simple way to settle a dispute or an innovative appeal when trying to
close a sale.
 The Creative Climate
The following are some important characteristics of this climate:

▶ A trustful management that does not overcontrol the personnel

▶ Open channels of communication among all business members
▶ Considerable contact and communication with outsiders
▶ A large variety of personality types
▶ A willingness to accept change
▶ An enjoyment in experimenting with new ideas
▶ Little fear of negative consequences for making a mistake
▶ The selection and promotion of employees on the basis of merit
▶ The use of techniques that encourage ideas, including suggestion systems and brainstorming sessions
▶ Sufficient financial, managerial, human, and time resources for accomplishing goals
Innovation and the Entrepreneur

▶ Innovation is a key function in the entrepreneurial process

▶ Innovation is the specific function of entrepreneurship. It is the mean by which the
entrepreneur either creates new wealth-producing resources or endows existing
resources with enhanced potential for creating wealth
▶ Innovation is the process by which entrepreneurs convert opportunities into
marketable solutions. It is the means by which they become catalysts for change.
▶ Innovation is a combination of vision to create a good idea and the perseverance and
dedication to remain with the concept through implementation
Types of Innovation

▶ Invention – the creation of a new product, service, or process – often one that is novel or
untried.
▶ Extension – the expansion of a product, service, or process already in existence.
▶ Duplication – the replication of an already existing product, service, or process, it is not
simply copying but adding the entrepreneur’s own creative touch to enhance and improve
the concept.
▶ Synthesis – the combination of existing concepts and factors into a new formulation. This
involves taking a number o ideas or items already invented and finding a way that they
can form a new application
The Major Misconceptions of Innovation

▶ Innovation is planned and predictable

▶ Technical specifications must be thoroughly prepared
▶ Innovation relies on dreams and blue-sky ideas – innovators are very practical people and
create from opportunities grounded in reality – not daydreams
▶ Big project will develop better innovations than smaller ones
▶ Technology is the driving force of innovation success – Market-driven or customer-based
innovations have the higher probability of success
Principles of Innovation

▶ Be action oriented – innovators must always be active and searching for new ideas
▶ Make the product, process, or service simple and understandable
▶ Start small
▶ Aim High
▶ Try\Test\Revise
▶ Learn from failures
▶ Follow a milestone schedule
▶ Reward heroic activity – innovative activity should be rewarded and given the proper amount of
respect.
THAT CONCLUDES MY REPORT