What Are the Ways in Which Entrepreneurs Typically Identify, Evaluate and Exploit Opportunities?

...

As well as finding an opportunity or business plan which best suits the firm or entrepreneur, one must be able to recognise the difference between a fad and a trend (a fad being a small change amongst a small group of consumers, lasting only a short period of time). Changing trends are the basis for many opportunities in business. A trend will affect a considerable portion of the market and last for considerable amount of time. In order to identify and exploit these trends, an organisation can use a number of techniques. They could appeal to statistics; either Primary or Secondary data which may have been paid for or collected by the firm themselves, in the form of postal questionnaires; street interviews or past market research records. Formal interviews or focus groups could also be used to examine consumer behaviours and identify new trends in the market, a key task when evaluating the potential benefits of an opportunity. Observing not only the trends of customers, but also the employment trends in more advanced countries also shows, “a move away from manufacturing, construction, mining and agriculture, towards a range of services, including retail, finance… professional and public services. This trend is… because manufacturing has become highly automated, and therefore generates proportionally less employment” (Bessant, Tidd, 2007, p.148). Entrepreneurs must take into consideration the sector of industry in which they are operating. Setting up a labour based manufacturing firm at this present time in the UK, for example, would be unwise due to the level of automated machinery now being used in the manufacturing industry.

Opportunities can come in any shape or form. They must, however, be researched fully and carefully in order to arrive at the best outcome, whether for a single entrepreneur, entering the world of business for the first time, or for an existing organisation, making some change to their current business plan or range of products or services. There are countless opportunities out there, it takes someone with entrepreneurial skill and a thirst for success, however, in order for these opportunities to be recognised, evaluated effectively and exploited to the best of their potential. If enough effort is put in and the original concept is one with some level of potential, there is no reason why success should not be achieved to a degree. In her case study, Thea Green replies to sceptics who believe that there will always be a good “reason why someone hasn’t already done that,” or they believe that, “someone else is already doing it,” with optimism and courage. Someone has to develop on opportunities, and if not someone else, why not oneself? Green states, “if there is a reason why someone else failed at it then you will find out very quickly.” If this is the case, nothing will be lost. To find any success in business, however, one must grasp the opportunities which will always be identifiable to someone of an entrepreneurial state of mind, and develop them to their absolute prime potential. The dictionary is not the only place where “success” comes after “evaluation”, “research” and “exploitation”.

Bibliography:

- Bessant, J. and Tidd, J. (2007) Innovation and Entrepreneurship. John Wiley & Sons Ltd.

- Davidson, P. Delmar, F. and Wiklund, J. (2006) Entrepreneurship and the Growth of Firms. Edward Elgar Publishing Ltd.

- Keh, H.T. Foo, M.D. and Lim, B.C. (2003) Opportunity Evaluation under Risky Conditions: The Cognitive Processes of Entrepreneurs (Online) Volume 27, Issue 2, p.125-148. http://onlinelibrary.wiley.com/doi/10.1111/1540-8520.00003/full Accessed 05/02/15

- Ray, L. (2015) 5 Steps to Evaluating Business Opportunities. (Online) Chron. http://smallbusiness.chron.com/5-steps-evaluating-business-opportunities-44673.html Accessed 10/02/15

- Wharton University (2009) Entrepreneurial Management (Online) https://mgmt.wharton.upenn.edu/programs/mba/program-information/entrepreneurial-management/ Accessed 12/02/15

Case Studies Referred to:

- Stephen Waring: Green Thumb

- Thea Green: Nails Inc

- Oliver Brendon: ATD Travel Services