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Evaluate possible sources for a new and innovative business idea

Unit 27: Identifying Entrepreneurial Opportunities

Unit code         Y/508/0540

Unit level         5

Credit value     15

Introduction

The role of the entrepreneur is to weigh up opportunities, threats and personal capacity to translate an opportunity into a business idea. This unit provides students with an understanding of where new venture ideas come from and gives them the opportunity to investigate and evaluate a new venture idea.

Students will explore concepts of innovation and creativity and develop creative abilities. They will learn about and use methods and frameworks to help develop and assess venture ideas, including defining product/service benefits, identifying target customers and understanding the industry and competitors from the perspective of a new entrant. They will learn about market research and apply primary and secondary research techniques to investigate a personal entrepreneurial idea and make an assessment of whether it is likely to be a commercially viable business or social enterprise proposition.

Learning Outcomes and Assessment

Pass

Merit

Distinction

LO1 Evaluate possible sources for a new and

 

innovative business idea

 

P1 Determine and

M1 Provide a detailed

D1 Critically evaluate the

evaluate different sources

evaluation of Drucker’s 7

benefits and drawbacks

of entrepreneurial ideas

sources of systematic

of different approaches

and innovation providing

innovation providing

and sources that can lead

specific examples.

specific examples.

to the identification of

 

 

entrepreneurial ideas

LO2 Explain the choice of a specific entrepreneurial

 

idea for investigation and the market gap that it

 

addresses

 

P2 Explain the rationale

M2 Provide justification of

D2 Critically evaluate a

and the market gap for a

how a specific

specific entrepreneurial

specific entrepreneurial

entrepreneurial idea fills a

idea based on

idea using relevant tools

market gap using

appropriate

and techniques to

different techniques for

interpretation and

support your choice.

gap and competitive

investigation of the

 

analysis.

competitive market place.

LO3 Use primary and secondary data to identify market potential

 

P3 Present data needed to support gap analysis in the evaluation of a specific entrepreneurial idea.

P4 Interpret data appropriately to provide evidence of market potential.

M3 Justify specific sources and methods of data collection chosen and how data relates to identifying market potential.

D3 Analyse appropriate specific sources and methods of data to provide justified business objectives and identify market potential.


Pass

Merit

Distinction

LO4 Evaluate the entrepreneurial idea in the context of the market and competitors and make an assessment of potential viability

 

 

 

D4 Formulate valid conclusions and justified recommendations on how a specific entrepreneurial idea can be developed, managed and sustained within the competitive market place.

P5 Apply a SWOT framework to collate evidence to support an objective assessment of a specific entrepreneurial idea.

P6 Evaluate the competitive market place in which the idea will be launched to assess potential viability.

M4 Critically evaluate a specific entrepreneurial idea in the context of the marketplace and competition.


Learning Outcomes

By the end of this unit a student will be able to:

  1. Evaluate possible sources for a new and innovative business idea.
  2. Explain the choice of a specific entrepreneurial idea for investigation and the market gap that it addresses.
  3. Use primary and secondary data to identify market potential.
  4. Evaluate the entrepreneurial idea in the context of the market and competitors and make an assessment of potential viability.

Essential Content

LO1 Evaluate possible sources for a new and innovative business idea

 Sources of business ideas

  • External/macro-environmental sources of change that create opportunities (Drucker’s 7 sources of innovation, STEEP factors).
  • The role of the ‘entrepreneur’ in weighing up opportunities, threats and personal capacity to translate the opportunity into a business idea.
  • Personal situational factors and knowledge.

Types of innovation:

  • The scope of innovation, particularly in relation to small firms.
  • The different types of innovation: product and process innovation; incremental vs big bang; Schumpeter’s sources of innovation.
  • The difference between invention and innovation and the role of creativity. Exploring the difference between a product or service idea and a business idea.
  • Innovation and location and the role of ‘clusters’ in fostering innovation amongst small firms.

Exploring creativity:

  • Understand and practice using creativity techniques to generate ideas.

LO2 Explain the choice of a specific entrepreneurial idea for investigation and the market gap that it addresses

Identifying customers:

  • Understand the need to identify specific customer types for targeting new ideas. Behavioural, demographic and geographic segmentation.
  • Tangible and intangible features and benefits of a product or service.

Understanding the industry environment:

  • How the industry environment affects the likely success of a new entrant.
  • Explore Porter’s Five Forces model to analyse the attractiveness of an industry from the perspective of a new entrant.
  • Approaches to competitor analysis relevant to entrepreneurs and small firms. Industry life-cycle.

LO3 Use primary and secondary data to identify market potential

Market research:

  • Primary and secondary research techniques for the investigating of new business ideas.

Identify, plan and undertake market research required.

  • The use of new technologies for audience research and analysis: use of big data to assess market trends, internet forums and social media to test market responses and evaluation.

Gap analysis:

  • Gap analysis to explain the gap in the market and the target customer group.

LO4 Evaluate the entrepreneurial idea in the context of the market and competitors and make an assessment of potential viability

Methods of Evaluation:

  • Evaluation of ideas using SWOT based on evidence from macro-environment, market and competitor analysis.
  • Objective assessment of the idea to judge whether it is likely to be viable as a business or social enterprise proposition.


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