Hisrich

Peters

Shepherd

Creativity and

the Business Idea

Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

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Creative Problem Solving

Creativity tends to decline with age, education, lack of use, and bureaucracy.

Latent creative potential can be stifled (restrain) by perceptual, cultural, emotional, and organizational factors.

Creativity can be unlocked by using any of the creative problem-solving techniques.

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Brainstorming Session starts with a problem statement. No group member should be an expert in the

field of the problem. All ideas must be recorded.

Reverse Brainstorming A group method that focuses on the negative

aspects of a product, service, or idea as well as ways to overcome these problems.

Criticism is allowed but care must be taken to maintain group morale.

Creative Problem Solving (cont.)

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Forced Relationships Developing an idea to solve a problem by

looking at product combinations. A five step process which focuses on idea

generation from relationship patterns between elements of a problem. Isolate the key elements of the problem Find the relationships between these elements Record the relationships in orderly form Analyze the relationships to find patterns Develop new ideas from these patterns

Problem statement ‘soap gets wasted on plastic rack’

Creative Problem Solving (cont.)

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Collective Notebook Method Developing a new idea to solve problem by

participants of a group regularly recording ideas at least once, but preferably three times a day.

At the end of a month participants giving their notebooks to a central coordinator who summarizes all the material.

The summary becomes the topic of a final creative focus group discussion.

Creative Problem Solving (cont.)

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Big-Dream Approach Developing a new idea by thinking about a

problem and its solutions without considering any constraints.

Then analyse each developed idea for feasibility until an idea emerges as a workable form.

Creative Problem Solving (cont.)

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Illustration of Parameter Analysis

Parameter AnalysisDeveloping an idea to solve problem by focusing on parameter identification and creative synthesis.1.Identify and analyse parameters (characteristics, feature) in the situation to determine their relative importance. Then the relationships between parameters are examined that describe the underlying issues.2.Through evaluation of the parameters (characteristics, features) and their relationships a solution (s) is developed; this solution is called creative synthesis

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Illustration of Parameter Analysis

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Parameter Analysis

Problem statement: Hair loss while showering with soap?

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The Product Planning and Development Process

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Product Planning and Development Process Establishing Evaluation Criteria

Criteria should be established at each stage of the product planning and development process.

It should be all-inclusive and where possible quantitative in nature so that easy to analyse.

Criteria should evaluate the idea in terms of: Market opportunity (demand/need for the market). Competition. Marketing system (compatibility with companies

experties). Financial factors. Production factors.

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Idea Stage Promising ideas should be identified and impractical ones

eliminated. Evaluation method – Systematic market evaluation checklist;

where each product idea is expressed in terms of its chief values to firm, merits and benefits to consumers. Promising ideas are selected and resources are not wasted on ideas that are incompatible with the market’s values

Determine the need for the new idea to market as well as its value to the company. In order to accurately determine the need for a new product, it is helpful to define the potential needs for the market in terms of timing, satisfaction, alternatives, benefits and risks, future expectations, price versus product performance features, market structure and size, and economic conditions.

Product Planning and Development Process (cont.)

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Concept Stage Refined product idea is tested to determine its acceptance

without necessarily incurring the costs of manufacturing the physical product

Product idea acceptance can be measured through the conversational interview with potential consumers or members of the distribution channel when appropriate.

Respondents are exposed to statements that reflect the physical characteristics and attributes of the product idea.

Features, price and promotion should be evaluated for both the concept being studied and any major competing products. By identifying any major problems marketable product, or the concept can be dropped and not receive any further attention.

Product Planning and Development Process (cont.)

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Product Development Stage Consumer reaction to the product/service is

determined. A consumer panel is given a product sample and

one or more competitive products simultaneously

Then preference are determined through multiple methods such as multiple brand comparisons, risk analysis, level of repeat purchases, or intensity of preference analysis etc.

Product Planning and Development Process (cont.)

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Test Marketing Stage Launch of a product in a selected area. This

increases certainty of successful product commercialization.

Actual sales reflect consumer acceptance. Positive test results indicate the degree of

probability of a successful product launch on bigger scale and company formation.

Product Planning and Development Process (cont.)

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Commercialization Stage

Product Planning and Development Process (cont.)

Introduction Growth Maturity Decline

Strategic sales objective

Build sales Build sales Hold sales Harvest/manage for cash

Strategic marketing focus

Expand market Penetrate markets Protect market share

Manage Productivity

Brand objective

Brand product awareness/trial

Brand preference Brand loyalty Brand exploitation

Product (features)

Basic; emphasis on reliability and functionality

Differentiated Differentiated Rationalized

Promotion Creating awareness/trial

Creating awareness/trial /focus on repeat purchasers

Maintaining awareness/focus on repeat purchasers

Cut/eliminated

Price High Lower Lowest Rising

Distribution Patchy Wider Intensive Selective

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Story of the week......“Larry Ellison”

Occupation CEO of Oracle Corporation

Net worth US$ 49.7 billion