entrepreneurship as innovation and problem solving

The Power of Entrepreneurship: Driving Innovation, Job Creation, and Growth

• August 27, 2023
• Entrepreneurship & Startups

Entrepreneurship, the catalyst of innovation and growth, holds immense power in driving global competitiveness and job creation. With its ability to foster creativity, problem-solving skills, and a culture of resilience, entrepreneurship propels individuals and economies forward.

By embracing risk and collaboration, entrepreneurs navigate a landscape of challenges, including limited capital and balancing work-life commitments. However, by developing clear business plans, conducting market research, and continuously innovating, entrepreneurs can overcome these obstacles and seize opportunities for personal growth and success.

Table of Contents

Key Takeaways

• Entrepreneurship enhances productivity and competitiveness in the global marketplace.
• Entrepreneurship drives innovation and economic growth.
• Entrepreneurship creates job opportunities and reduces unemployment rates.
• Entrepreneurship fosters creativity and problem-solving skills.

The Impact of Entrepreneurship on Global Competitiveness

Entrepreneurship enhances global competitiveness by driving innovation, creating job opportunities, and fostering a culture of risk-taking and resilience.

Through entrepreneurship, sustainable development can be achieved by addressing key economic, social, and environmental challenges.

Entrepreneurs play a vital role in reducing income inequality by creating businesses that provide employment and income opportunities to marginalized communities.

By promoting inclusive entrepreneurship, individuals from diverse backgrounds can access resources and support to start their own businesses, thereby narrowing the income gap.

Furthermore, entrepreneurship contributes to sustainable development by introducing innovative solutions that address pressing global issues, such as climate change and resource scarcity.

In this way, entrepreneurship not only drives economic growth but also contributes to a more equitable and sustainable world.

Entrepreneurship as a Catalyst for Innovation and Economic Growth

In today’s rapidly changing economy, entrepreneurs play a vital role in spurring technological advancements and boosting the overall economic landscape.

Entrepreneurship is not only about starting a business but also about driving innovation and fostering economic growth. Entrepreneurs have the power to create new products and services that address societal needs and contribute to sustainable development.

They have the ability to bring about positive social impact by creating job opportunities, reducing unemployment rates, and improving the quality of life for individuals and communities.

Job Creation and Entrepreneurship: Building a Stronger Economy

By creating new businesses and providing job opportunities, entrepreneurs contribute to the development of a stronger economy. The role of entrepreneurship in reducing unemployment rates and creating job opportunities is crucial for economic growth and development.

Entrepreneurs are at the forefront of innovation and play a vital role in driving economic expansion. Through their ventures, they not only create employment opportunities but also foster a culture of creativity and problem-solving. By identifying gaps in the market and addressing unmet needs, entrepreneurs stimulate economic growth and contribute to overall development.

Moreover, entrepreneurship encourages a sense of risk-taking and resilience, which are essential qualities for success in today’s rapidly evolving business landscape. By supporting and promoting entrepreneurship, governments can create an enabling environment that nurtures innovation and leads to sustainable economic growth.

Cultivating Creativity and Problem-Solving Skills Through Entrepreneurship

Entrepreneurs who cultivate creativity and problem-solving skills are better equipped to identify market gaps and develop innovative solutions. Enhancing problem-solving abilities through entrepreneurship not only benefits individuals but also drives overall economic growth.

By fostering creativity through entrepreneurial endeavors, individuals are encouraged to think outside the box and find unique solutions to challenges. This mindset of innovation allows entrepreneurs to create products and services that meet the changing needs of consumers.

Moreover, problem-solving skills are crucial in navigating the complexities of the business world and overcoming obstacles that arise along the way. Through entrepreneurship, individuals have the opportunity to constantly refine their problem-solving abilities, leading to increased efficiency and effectiveness in addressing market gaps.

Therefore, cultivating creativity and problem-solving skills through entrepreneurship is essential for those seeking to make a meaningful impact and drive innovation in today’s fast-paced world.

Embracing Risk and Resilience: The Entrepreneurial Mindset

Embracing risk and resilience, successful entrepreneurs demonstrate a mindset that allows them to navigate uncertainties and bounce back from setbacks. They understand that taking calculated risks is essential for innovation and growth. These entrepreneurs possess a risk-taking mindset, which enables them to identify opportunities and make bold decisions. They are not afraid of failure, but rather view it as a learning experience.

Resilience is another key trait of successful entrepreneurs. They understand that setbacks are inevitable, but they don’t let them define their journey. Instead, they use setbacks as motivation to improve and adapt. Resilient entrepreneurs are able to stay focused on their goals, even in the face of adversity. They possess a strong determination to overcome obstacles and continue moving forward.

Overall, risk-taking and resilience are crucial aspects of the entrepreneurial mindset, enabling entrepreneurs to navigate the challenges of the business world and achieve long-term success.

Government Policies and Regulations: Nurturing the Entrepreneurial Ecosystem

Government policies and regulations play a crucial role in creating an environment that nurtures and supports entrepreneurship. To foster innovation and job creation, governments around the world offer various forms of support to entrepreneurs.

One key area of support is through funding opportunities. Governments provide grants, loans, and tax incentives to help startups access the capital they need to launch and grow their businesses. These funding opportunities not only alleviate the financial burden faced by entrepreneurs but also encourage them to take risks and pursue their innovative ideas.

Additionally, governments support entrepreneurship by streamlining bureaucratic processes and reducing red tape, making it easier for entrepreneurs to navigate legal and regulatory frameworks. By providing such support, governments empower entrepreneurs to drive economic growth and create a thriving entrepreneurial ecosystem.

Overcoming Challenges: The Journey of an Entrepreneur

Despite facing numerous obstacles, entrepreneurs continue to persevere and overcome challenges on their journey to success. They possess the entrepreneurial mindset, which enables them to navigate through uncertainty and embrace risk-taking.

To achieve success, entrepreneurs employ various strategies, including:

• Developing a clear business plan and setting achievable goals.
• Conducting market research to identify customer needs and trends.
• Building a strong team with complementary skills and expertise.
• Developing effective marketing and sales strategies.
• Continuously innovating and adapting to changing market demands.

These strategies allow entrepreneurs to stay ahead of the competition and create innovative solutions that meet customer demands.

Frequently Asked Questions

How can entrepreneurs enhance productivity and competitiveness in the global marketplace.

Entrepreneurs enhance productivity and competitiveness in the global marketplace by identifying market needs, developing innovative solutions, and efficiently delivering products or services. Through their entrepreneurial mindset, they drive economic growth and create value for customers.

What Role Does Entrepreneurship Play in Driving Innovation and Economic Growth?

Entrepreneurship plays a crucial role in driving innovation and economic growth. Startups and the entrepreneurial ecosystem foster a culture of creativity and problem-solving, leading to new ideas, products, and services that fuel economic development and job creation.

How Does Entrepreneurship Contribute to Job Creation and Reducing Unemployment Rates?

Entrepreneurship contributes to job creation and reducing unemployment rates by fostering a dynamic entrepreneurial ecosystem and promoting small business development. This creates opportunities for new ventures to emerge and grow, leading to increased employment opportunities and economic growth.

In What Ways Does Entrepreneurship Foster Creativity and Problem-Solving Skills?

Entrepreneurship fosters creativity and problem-solving skills by encouraging individuals to think outside the box, take risks, and find innovative solutions to challenges. It provides a platform for experimentation and learning, leading to the development of new ideas and approaches.

Why Is It Important for Entrepreneurs to Embrace Risk and Develop Resilience?

Entrepreneurs must embrace risk and develop resilience to navigate the uncertainties of the market. By taking calculated risks and bouncing back from failures, they can adapt to changing conditions, seize opportunities, and drive innovation, ultimately ensuring long-term success.

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Entrepreneurship and innovation: Ideas and opportunities for startups

Entrepreneurship drives economic growth and shapes the future. 1 Disruptive technologies continue to shake up the status quo in the 21st century. Innovative people with the ability to identify opportunities and execute ideas effectively are propelling the world economy into new stages that will potentially change humanity's trajectory for decades or even centuries to come.

In addition to bringing much-needed innovation to the global marketplace, entrepreneurs are responsible for a significant amount of value in the world economy. In fact, small to medium-sized enterprises–SMEs–and the entrepreneurs who lead them account for 55% of GDP in developed countries. More than 90% of businesses worldwide are SMEs, employing half the world's population. 2

However, there's a lot to learn on the path to becoming a successful entrepreneur.

In this article, we'll delve into entrepreneurship, methods for generating startup ideas that offer innovation opportunities, and raising funds through venture capital and angel investors to support growth strategies for your innovative ideas.

Introduction to entrepreneurship and business innovation

Entrepreneurship refers to the process of identifying and pursuing opportunities to create and manage new businesses or ventures. Entrepreneurs are individuals who take the initiative to innovate, organize resources, and take risks in order to bring their ideas to life and achieve success in the business world.

Innovation is the lifeblood of entrepreneurship. What that means is to succeed you should develop and implement creative ideas, products, services, and processes that add value or improve existing solutions.

Innovation is vital for businesses to survive in today's competitive landscape. 3 It helps businesses adapt to change, fosters growth, and separates a business from its competition.

Identifying startup opportunities

According to world-renowned consulting firm McKinsey, the three main elements are knowing your who, what, and how. 3 Let's explore this further.

• The who: Identify the customers and what pain points they need to be addressed
• The what: Pinpoint how to solve these pain points and fill gaps in the market in a compelling and executable way
• The how: Create a business model canvas that generates value

The first step in identifying the who, what, and how before generating startup ideas is to do a market analysis that'll help you understand your market, its needs, and any gaps you can fill. 4

Idea generation and innovation strategies

The word innovation is often used interchangeably with creativity, and that's precisely what you'll need to create an innovative business idea. Here are a few techniques for creating business ideas and fostering an entrepreneurial mindset:

Brainstorming

As the go-to first step for idea generation, brainstorming encourages free-flowing idea generation that helps lead to unexpected and creative concepts.

Problem-solving

Identify pain points that you, your family, or your friends often experience and need to be solved. From there, you can devise ways to solve these pain points and form a business around that.

Lean startup methodology

This focuses on quickly building a minimum viable product–MVP–to test hypotheses and gather customer feedback. Focusing on MVP means developing the most basic version of a product or service containing only essential features to test its viability and gather feedback from early adopters.

Once you decide on a business idea through brainstorming and problem-solving, finding a way to test your idea will be essential for refining it to become as viable as possible.

Market research and validation

Before moving forward at a full pace, you'll want to conduct market research and validate your startup concept. You can do this by creating customer personas, analyzing market trends, and conducting a SWOT analysis–you'll need to determine what strengths, weaknesses, opportunities, and threats your startup will face.

From there, creating a minimum viable product will help you understand your viability by offering it to potential customers and then engaging with your audience through surveys and interviews to gather feedback. 5

Building a strong value proposition

A value proposition is a concise statement that communicates the unique benefits and value your product, service, or solution offers to your target audience. Your value proposition should pinpoint the specific benefits and advantages that your product or service offers that differentiate your business from the competition's. 6

Your value proposition will be as unique as your business, but you'll likely want to start with some of these steps:

Identify unique benefits and highlight key features

Determine what you provide that sets you apart and showcase the benefits that you can supply to your customers.

Address pain points

From your research, you should understand your consumers' pain points. Your value proposition should directly address how it solves your audience's needs.

Define your unique selling proposition

This is a distinct element or feature that sets your product or service apart from the rest of the market.

Business model development

Business models serve as the blueprint for how businesses operate, and 21st-century innovation has led to an upheaval of traditional business models. 7

To develop a modern business model that's sustainable and scalable, you'll need to:

• Diversify your revenue source by not relying on a single product, service, or customer segment
• Utilize technology to scale your business using automation
• Balance your costs and pricing strategy to maximize profit while also maintaining competitiveness and product quality
• Identify partnerships that can help your business grow in a competitive market

A sustainable and scalable business model requires planning, so it's imperative to learn as much about various business models as possible to discover what's right for your business.

Fundraising and financial planning

Startups require considerable upfront funding to get your business organized and moving. Let's explore a few ways for you to fund your startup.

Venture capital

You may want to use venture capital, which involves raising funds from professional investment firms in exchange for equity–ownership–in your startup.

Angel investors

On a similar note, you can look into finding angel investors. These are individuals, rather than investment firms, who provide capital to startups in exchange for equity.

Bootstrapping

If neither of those appeals, or they aren't practical as you work on your launch, you can consider funding your startup by bootstrapping. This is when you fund your startup by yourself with money from your savings or by other personal means.

Startup accelerators

Regardless of your funding source, you may want to look into participating in a startup accelerator program, which will connect you with additional resources to streamline your startup's progression. Depending on the program, you may be able to find additional funding or investors, have expenses met, or gain important networking opportunities. 8

Marketing and growth strategies

Launching a successful startup isn't only about the product or service. A successful startup needs a marketing plan that utilizes research and creativity to reach audiences and convince them to purchase.

In the modern market, digital advertising is a critical form of marketing. 9 This includes email marketing, search engine optimization, social media advertising, and other advertising strategies that utilize the internet to reach consumers.

Customer acquisition and retention will also be fundamental to your startup's growth and sustainability. Learning how to refine your marketing strategies, optimize new customer onboarding processes, and create a top-notch customer service department will help your startup thrive.

Digital marketing strategies for startups

Understanding and utilizing various digital marketing services can be a game changer in reaching and engaging your target audience.

Here are some key strategies:

Embrace social media marketing

Utilizing social media platforms effectively is non-negotiable for a successful business. From organic engagement to paid advertising, social media offers a myriad of opportunities to connect with potential customers, build brand awareness, and drive traffic to your website.

Implement SEO tactics

For any online business ideas, visibility on search engines is vital. Investing in Search Engine Optimization (SEO) improves your website's ranking, making it more likely to be discovered by those searching for your products or services.

Engage in high-quality content marketing

Quality content is the backbone of digital marketing. Whether it's blog posts, videos, or infographics, providing valuable, relevant content can attract and retain a clearly defined target market, ultimately driving profitable customer action.

How to maximize startup growth with digital marketing services

In the context of startups and entrepreneurship, several digital marketing services can be extremely beneficial. These services help in reaching the target audience, building brand awareness, and driving growth. Here is a closer look at some of the key digital marketing services that can be useful:

• Search Engine Optimization (SEO) : This service focuses on improving a website's visibility in search engine results. It involves optimizing website content and structure to rank higher for relevant keywords, thereby increasing organic traffic.
• Social media marketing : This involves promoting a brand, products, or services on various social media platforms. It includes creating and sharing content, engaging with followers, and running targeted advertising campaigns.
• Content marketing : Content marketing involves creating and distributing valuable, relevant, and consistent content to attract and retain a clearly defined audience. This can include blog posts, videos, infographics, and other types of content that provide value to potential customers.
• Email marketing : Email marketing involves sending targeted and personalized messages to a segmented audience via email. This service can be used for nurturing leads, announcing new products or services, and keeping customers engaged with the brand.
• Pay-per-click (PPC) advertising : PPC is a model of internet marketing where advertisers pay a fee each time one of their ads is clicked. It's a way of buying visits to your site, rather than attempting to “earn” those visits organically.
• Influencer marketing : Partnering with influencers to promote products or services can be beneficial. Influencers have a dedicated social following and are viewed as experts within their niche, which can be leveraged to gain credibility and reach a wider audience.
• Affiliate marketing : This involves promoting products or services through affiliates who receive a commission for every sale or lead they generate. It's a performance-based approach that can help expand reach and sales.
• Online reputation management : Online reputation management covers managing and influencing the public perception of an organization or individual online. This includes monitoring and responding to customer feedback on various digital platforms.
• Web analytics : Using tools like Google Analytics to track and analyze website traffic is a part of web analytics. This helps in understanding user behavior, which can inform marketing strategies and website improvements.
• Mobile marketing : Reaching customers through mobile devices via SMS, email, websites, and apps is involved in mobile marketing. With the increasing use of smartphones, mobile marketing is crucial for engaging customers on the go.
• Video marketing : Great video marketing involves creating and leveraging video content to promote a brand, product, or service. Videos can be used on various platforms, including YouTube, TikTok, various other social media platforms, and company websites.
• Conversion Rate Optimization (CRO) : Improving the website to increase the percentage of visitors who complete a desired action, such as making a purchase or filling out a contact form, is a key aspect of CRO.

Integrating these digital marketing services can help startups effectively reach and engage their target audience, build brand recognition, and drive business growth.

The art of crafting profitable business ideas

For entrepreneurs, generating profitable business ideas is both an art and a science. It involves a deep understanding of market needs and creative thinking. Here's how to develop great business ideas:

Identify market gaps

Look for unmet needs or unsolved problems in your chosen field. A great startup idea often comes from finding a gap in the market and figuring out how to fill it.

Analyze consumer behavior

Understanding your potential customers is key. Conduct market research to gather insights into consumer behavior and preferences, which can inspire innovative and profitable business ideas.

Leverage emerging technologies

Incorporate new and emerging technologies like cloud technology into your business idea. This approach can help you stay ahead of the curve and create a business model with a competitive edge.

Transform your ideas into successful online ventures

Turning startup ideas into a thriving online business requires a well-thought-out business plan and an understanding of the digital landscape. Here are steps to consider:

Develop a robust business plan

Your business plan should detail how you intend to turn your startup idea into a successful business. It should include market analysis, business strategy, financial projections, and an operational plan.

Choose the right business model

Select a business model that suits your business idea. Whether it’s a subscription service, a freemium model, or a traditional retail setup, the right model can make a big difference in the success of your venture, especially for small business ideas.

Utilize online platforms and tools

As previously mentioned, utilizing online platforms and tools is a critical element of successful entrepreneurship for startups. From setting up an e-commerce store to offering online courses, the internet provides a plethora of platforms and tools that can help launch and grow your business with relatively low startup costs.

By integrating all of these aforementioned strategies and focusing on innovative startup ideas, entrepreneurs with the right business acumen can position themselves for success in today’s competitive world of digital entrepreneurship.

Empower your entrepreneurial journey with knowledge: Join KU's online MBA program

If you want to learn more about how to become a successful entrepreneur, the University of Kansas online MBA program is where your innovative journey begins.

KU’s top-ranked, flexible two-year MBA curriculum offers a comprehensive education that covers supply chain management, international business, managerial economics, and more. 10

Contact a University of Kansas admissions outreach advisor today to find out how you can earn your advanced degree on your own time and while working to get your startup off the ground.

• Retrieved on November 6, 2023, from thinkmarketingmagazine.com/how-entrepreneurship-can-shape-a-better-future-for-the-country/
• Retrieved on November 6, 2023, from ncbi.nlm.nih.gov/pmc/articles/PMC8302973/
• Retrieved on November 6, 2023, from mckinsey.com/featured-insights/mckinsey-explainers/what-is-innovation
• Retrieved on November 6, 2023, from businessnewsdaily.com/15751-conduct-market-analysis.html
• Retrieved on November 6, 2023, from blog.hubspot.com/the-hustle/minimum-viable-product
• Retrieved on November 6, 2023, from blog.hubspot.com/marketing/write-value-proposition#how-to-write
• Retrieved on November 6, 2023, from forbes.com/sites/bernardmarr/2023/03/14/the-7-most-successful-business-models-of-the-digital-era/?sh=5a6288295617
• Retrieved on November 6, 2023, from hubspot.com/startups/resources/what-is-an-accelerator
• Retrieved on November 6, 2023, from statista.com/topics/1176/online-advertising/
• Retrieved on November 6, 2023, from usnews.com/education/online-education/university-of-kansas-155317

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Invention and Innovation as Creative Problem-Solving Activities

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Beckenbach, F., Daskalakis, M. (2020). Invention and Innovation as Creative Problem-Solving Activities. In: Carayannis, E.G. (eds) Encyclopedia of Creativity, Invention, Innovation and Entrepreneurship. Springer, Cham. https://doi.org/10.1007/978-3-319-15347-6_370

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A Roadmap for Today’s Entrepreneurs

A conversation with MIT Sloan’s Bill Aulet on how to navigate a fast-changing landscape.

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Many people aspire to entrepreneurship but we all know it’s a high-risk endeavor. Bill Aulet, the Ethernet Inventors Professor of Entrepreneurship at the MIT Sloan School of Management, has for decades studied what it takes for start-ups to succeed and advises the next generation of founders on how to do it. He discusses the key trends and changes he’s seen over the past few years, and outlines concrete steps anyone can take to get a new venture — including those within larger organizations — off the ground. Aulet is the author of the newly updated book Disciplined Entrepreneurship: 24 Steps to a Successful Startup.

ALISON BEARD: Welcome to the HBR IdeaCast from Harvard Business Review. I’m Alison Beard.

So many people in business today aspire to entrepreneurship. Whether you have an idea for a start-up or want to launch something new within a larger organization, it’s seen as a path to a more fulfilling career – and financial gains. At the same time, we know that entrepreneurship is really hard. We’ve all heard the stats on how many new ventures fail, and we’ve seen entrepreneurial efforts quashed by the corporate machine.

But our guest today says that we can de-risk the process and create companies that don’t just make a lot of money, but also have a positive impact on the world. He’s helped thousands of students and executives map out paths to successful businesses, and we wanted to speak with him about where he sees entrepreneurship today.

Bill Aulet is the Ethernet Inventors Professor of Entrepreneurship at the MIT Sloan School of Management. He’s managing director of the Martin Trust Center for MIT Entrepreneurship, and he’s the author of Disciplined Entrepreneurship: 24 Steps to A Successful Startup , newly updated and expanded. Bill, thanks for being on the show.

BILL AULET: Thank you very much. It’s an honor to be here.

ALISON BEARD: So you’ve been focused on innovation-based entrepreneurship for decades. What feels new or different right now compared to previous eras?

BILL AULET: I think if you look at the highest level, entrepreneurship is now accepted in society at a level that it was not nearly when I first started. When I graduated from college, which was back in 1980, they had just invented electricity. But no one thought of entrepreneurship as a serious field of study or a career.

I – God rest my mother’s soul, she was fantastic, but she never understood the difference between entrepreneurship and unemployment. She thought I was unemployed. But today people understand entrepreneurship. It’s accepted by society. And not only is it accepted by society, it is one thing that unites us. No matter whether you’re on the far right, far left, everybody loves entrepreneurship. One of the big differences that’s often overlooked is just the acceptance of entrepreneurship as a serious career path and a positive thing from all perspectives.

When we look at the more micro level, the numbers start to show you the people who want to come out of college, 20% or more of at almost every university, see entrepreneurship as a career path that they want to pursue. Some of them want to do it for money, but what we see is most of them want to do it because they feel like it’s a way to have impact. It’s a way to control their own destiny.

And then even at a more micro level, when you look at what’s going on now, not just the acceptance of entrepreneurship, the barriers to become an entrepreneur have really gone down. Let me give you one example. Just when I wrote the initial version of this book 10 years ago, it took you millions of dollars and at least six months, if not a year, to put an e-commerce company up, to get an e-commerce website going today. You can literally do that in two hours or possibly even one hour or less using Shopify. And that’s just one example of what’s going on with AWS.

All the technology that’s come out has made it much easier to create new products to start companies, which has actually shifted the game from, “You need to make a product to be an entrepreneur,” to “How do we go to market with a product?” Because products are becoming more and more, I don’t want to say commoditized, but it’s easier to produce products. And so of course you have to have a product at the end of the day, you have to get product market fit. That’s table stakes. But the actual game has shifted to be more of a, how do you come up with a go-to-market fit that is a channel market fit? How do you sell the product?

ALISON BEARD: MIT is obviously a hub for science and tech-based startups. So is the path from high-tech research lab to business getting easier also?

BILL AULET: This is a really interesting question because I just presented to the MIT board on this, and they were very interested in how do we accelerate that pipeline of lab to market? And there’s two approaches to that. The first approach is why don’t we make our technical people, our academics… Or researchers, they don’t have to be academics, researchers, more entrepreneurial. How do we teach them the entrepreneurial process? And we do that. We have a program called the Faculty Founders Program where we teach them how to do that. That’s one way to do it.

The other way to do it is to basically flood the zone with high-quality entrepreneurs who aren’t necessarily the inventors. Because entrepreneurship has many misperceptions about it and one of them is it’s an individual sport. It is definitively not by research. Entrepreneurship is not an individual sport, it’s a team sport. And the question is, how do you build a team that can take a technology, a new invention to market? And to do that, you have to have someone who knows how to commercialize it. Those people aren’t necessarily the same as the inventor. And so if you have great inventors and they understand the process to some degree, what we want to do is produce more high-quality entrepreneurs to kind of be around them. And then they will take that technology and that new invention and bring it to market.

I mean, people believe MIT is this faunt of entrepreneurship because of the tremendous research we have here, and we do. We have enormous research, but so does Caltech, so do other places. What really makes a difference is how much of that research can you commercialize? And that’s where the entrepreneurial process comes into play. And even if you look at MIT, less than 6% of the patents that we create are actually commercialized. Let me repeat that. Of all the patents we get, less than 6% of them actually get to the market, and that includes licensing to other companies. So if we could just increase that number somewhat, the pipeline of the billions of dollars that are spent on research here at MIT to get that to market would create a lot more impact.

ALISON BEARD: You note that entrepreneurship is not limited to startups. It can come from within large organizations too, especially ones with deep pockets like an Amazon or Alphabet or Meta. Have you seen any shift in where students and executives think that they’re best positioned to be entrepreneurial?

BILL AULET: I wish I could tell you that there’s more of that, but entrepreneurship is such a complicated thing. You mentioned this at the front. It’s really hard. And still, the best way to teach entrepreneurship is to go to the blank canvas of a startup. And that’s what we do in our programs for the most part. We start off with a blank canvas and then we teach people how to come up with ideas and then how to take those ideas and then figure out what’s a product to get product market fit, channel market fit, and then come up with a scalable business model that’s profitable – economically sustaining.

But if we stay at that level of just seeing entrepreneurship in startups, we as a society are going to be really underperforming against some of the big challenges we have like climate, because startups can only get you so far. They don’t have the strong balance sheets that can think for long periods of time. They don’t have the infrastructure. And when you think about challenges like climate and energy, we need to have big companies involved. And so we really do focus a lot on how do you take those skills. We teach you in startups and apply them in large companies.

We really encourage people to not just be entrepreneurs and startups, but to do it in government, in academic institutions and large organizations and medium-sized organizations and faith-based organizations or nonprofits and even in their personal lives. And I would like to see more of that. But it’s a hard sell because you got to build up the skills first before you go into that. But we’ve had huge successes.

I’ll give one example. Andrea Ippolito went through us – she’s a Cornell undergraduate, came here and was getting her graduate degree and then going for a PhD, and she went through our entrepreneurship programs. She was doing a company called Smart Scheduling to help healthcare organizations do kind of digital innovation to make them more effective, which is huge opportunity there. Well, she decided not to continue on that startup, but learned all the lessons. She then goes back to get her PhD. She’s recruited to go into the Obama White House, and she becomes the chief innovation officer overseeing the Veterans Administration. And she starts setting policies to improve innovation and entrepreneurship in the government for our veterans out there. She didn’t start a company at that point, and she’s literally making the lives of millions of our veterans better.

So I think that’s the journey. She was an entrepreneur the whole time. And the mindset, skillset and way of operating that we taught her, benefited her in all dimensions, not just in being a startup. I sometimes am frustrated, although if we get into it, I’ll talk about metrics of measuring success. And it’s too often measured and how many startups, how much revenue do they do, how much money did they raise – whereas how do you measure the impact that Andrea Ippolito had in those various jobs?

ALISON BEARD: Yeah. I mean the criticism of entrepreneurs in general and particularly tech startups for a while has been that they’re more focused on sort of easing these small pain points for pretty well-off customers. Like I’m thinking Uber, DoorDash, Tinder even, then tackling more difficult and important and challenging problems. Is that changing?

BILL AULET: Well, I can’t say for universal, but if you look in my new book, we very much believe, and this is something I work with Tom Byers of Stanford and Jon Fjeld on is entrepreneurship as an ethical activity. If you’re in it for profit-making, you’re not going to last.

And so the first thing that we start with, excuse me, is you must have a raison d’etre. That’s French for reason for existence. And if you say that it’s to make money, we reject that because no company is just all about profits and going to last.

And then just to go to the data here, we did a 10-year longitudinal study of our students coming out of our Delta V program, our capstone program. There’s this perception that people are doing dating apps and silly things. Well, our data showed, and this was an independent study by Daniela Ruiz Massieu of ITAM University, a tenured year professor, head of their entrepreneurship down there. And she came in and looked at it. And in the 10-year study looking at almost 200 entrepreneurs, she found that 89% of the businesses they were starting 89, 8-9, were directly aligned with the UN Sustainable Development Goals.

That makes me very, very proud. And that goes directly to what you’re talking about. We believe entrepreneurship is an incredible force for good in society. And if you understand that and you build your companies based on mission, mission-driven as opposed to money-driven, they will be more successful. And going to the data on how successful they are, her study shows 69% of them are still in business five years later.

ALISON BEARD: Those statistics definitely give me hope. But I would say that still the primary successful examples of entrepreneurs and companies might cloak their businesses in laudable goals like connecting the world for Facebook or giving us information like Google, when in practice what they seem to be doing is collecting and selling our data, addicting us to their platforms, and they’re still making piles of money. So how do you reconcile that with your vision of successful entrepreneurship always being ethical?

BILL AULET: That’s a really good point. I think I’m a system dynamics person which says the incentives of the system will dictate how people behave in it, and I find those very troubling. I find by the way, the examples of using social network or the Steve Jobs movies as that’s entrepreneurship, I find those to be very unhelpful. They’re misleading. They don’t get into what the real data shows you.

So how do I reconcile those? All I can tell you is that our companies are like Biobot Analytics. Biobot Analytics is started by two of our students here. One was Mariana Matus who was a PhD here at MIT from Mexico, and she wanted to start a company to make the world a better place and make cities more livable. And she partnered with Newsha Ghaeli who was Persian, that’s Iranian by way – out of Canada. They were very into how do we create safer cities.

They looked at this and built a dashboard that looked at wastewater, epidemiology wastewater, that is what we flush out the toilet and see what diseases do we have, what other things are going on in the city. So basically we could set it up in Boston and we could know. In Jamaica Plain, everything seems healthy, but if you look at West Cambridge, there seems to be some fentanyl use there or there seems to be a Zika virus outbreak. When they were going through our program, we actually had a discussion about what they were doing, and they were very into this. And then they met with one of the top venture capitalists in the world. And the top venture, this person said, enormously successful, sat down and said, “You’re not going to make a lot of money doing this. You should pivot to help pharmaceutical companies.”

And we walked out of the meeting. I said, well, “He’s very accomplished. What do you want to do? If that’s not what you want to do, we fully support you.” They said, “That’s not what we want to do. We want to make cities safer.” They stuck to there what they were doing. And Biobot Analytics has become extremely successful. They became the gold standard during Covid for measuring whether Covid is in a place weeks before you could with testing. And they’re doing tens of millions of dollars. They’re on a path to IPO.

ALISON BEARD: Well, that’s a fabulous example. What about the criticism that startup founders are often so laser-focused on bringing their idea, maybe one that will have good social impact to fruition, that they don’t think about the potential risks or negative externalities or broader consequences I’m thinking about the concerns that people have about OpenAI, for example. I think Sam Altman is sort of heralded as a new kind of entrepreneur, a new generation of entrepreneurs, but people are now also worried that he’s sort of stepping away from his initial altruistic vision for the company.

BILL AULET: Yeah, I mean, I think that’s a real leadership question that you’re going to have. At the end of the day, all these companies come down to the talent that they can draw. I think if you have unethical activities, people today are cognizant of that. They’re not just going to work for companies they feel are unethical. And that’s my hope. I don’t have data to back that up to the level that I would like, but that’s my sincere belief, Alison.

ALISON BEARD: Yeah. And perhaps having gone through the era of social media in particular, Facebook, Instagram, X, et cetera, and all the sort of unexpected problems, whether it’s teenage girl eating disorders to election interference, there’s perhaps more scrutiny now on startups to make sure, “Are you thinking about all the potential things that could go wrong as you’re building your business plan?”

BILL AULET: I would hope so. But again, we have a capitalist system that rewards you for making money and getting customers and the like. I think there’s definitely a role for government and regulation in that regard. I differ from some of my entrepreneurial libertarian colleagues in that regard. I think we do need that. I’m not here to tell you everything, sunshine, rainbows and unicorns jumping around, that is a challenge going forward. And that’s why unfettered capitalism I just don’t think is the right answer.

ALISON BEARD: Okay, so let’s dig into the updated book, which as I said, sets out 24 steps to getting a startup off the ground, from market segmentation to developing a product plan. And we obviously can’t get to all of the steps, but what, if anything, did you change from the 1st edition to this one?

BILL AULET: Oh my God, the 1st edition, just to put a little quick historical perspective on this, when I started teaching, I think it was 17 years ago, I started looking for that book that captured what I had learned being an entrepreneur for decades, we’re going from three startups and failing in my first one and getting better at the second one to having success in the third one to say, “Who’s captured that knowledge?” And all I found were books that were point things. You’d find Lean Startup, you’d find a Blue Ocean Strategy, you’d find Crossing the Chasm, these are all great books, but they were all individual tools.

And so for my class, I built a reader and I tried not to invent new stuff. I tried to take what I know already worked and just kind of stitch it together. And that was the genesis of this reader, which then it became quite popular- and people said, “Hey, this is really great. How can I get a copy of it?” And Wiley said, “Hey, we’d like to publish this.” And so the first version was minimum viable product.

And then once it got out there, I’ll never forget a colleague of mine here at MIT, Professor Charlie Fine, said, “Now you’re really going to learn about entrepreneurship.” And I said, “What do you mean? I put everything I know into that book.” He said, “Oh no, now you’re really going to learn because everyone’s going to come and tell you everything they know and they’re going to ask you questions and you’re going to become kind of the focal point of entrepreneurship discussion.” And dang it, Charlie was right. That’s what happened. Everybody started talking to me about that.

We literally got thousands of more examples as to how to do that. And over the past 10 years, we’ve learned so much. I’ve taken that minimum viable product and updated it to a new dramatically expanded and updated version with some of the new things we were talking about. And my first rewrite of it was 700 pages, which was completely unacceptable because the key to the book is, A, that it’s open source. We try to build a and take everything that works so that Simon Sinek, Jeffrey Moore, Stefan Thomke, Michael Porter – whoever it is, we’re pulling it in and we’re saying, “This is your toolbox that you need to do.” But that toolbox has to be small enough and accessible enough to be able to be used by an entrepreneur who has finite time and resources. In the end, we got it down to 400 pages. But it’s also expanded to be able to talk about how do you use AI, the change in the past 10 years between products becoming commoditized and the emphasis now is on go-to market, how do you develop go to market.

ALISON BEARD: Yeah. And I think that efficiency and practicality point is key, particularly for people who are considering becoming intrapreneurs. So it’s not like they’re trying to find a start-up and devoting all their time to it. It’s their full time job. But people who might want to start something new within an organization, how do you think about doing that in a way that is relatively easy, still takes thought and time, but you can work through a process before you present it to the higher ups?

BILL AULET: That’s exactly right., we’ve got to say, “Here’s the simplification of it and here’s where you get started and here are the steps you go through. While we’re giving you a sequential one, you have to understand it’s not linear. You’re going to have to do a lot of cycling, but at least you know what you’re supposed to be going.” Gives you some GPS, some templates and things to help you. But it’s a never-ending process.

The day you think that you’re done with entrepreneurship… I think Bob Dylan said it best, “He who is not being born is busy dying.” You have to continually be running the entrepreneurial process and understanding who your customer is, what you can do for your customer, how they acquire the product, how you make money, how do you scale the business. All these things are a never-ending cycle.

ALISON BEARD: How are your students and executives using new technology, like I’m thinking social media and gen AI, to make this process easier or faster?

BILL AULET: Well, we actually have a terrifically interesting tool right now. We’re internally calling it Tim the Beaver, your friendly AI entrepreneurship assistant. What it does is it’s a modified version of ChatGPT-4 Plus, which you could also use Gemini or whatever we want, but it takes the structure that we have in disciplined entrepreneurship and it trains that to ask the questions and fill in templates to say, “What’s your idea? Here’s your potential customers, which ones do you like? Which ones do you not like? What would be a beachhead market?” And then it will step you through, “Here’s your potential customers. Oh, by the way, here’s how you can reduce your cost to customer acquisition.”

And so using things, as you mentioned, like… I mean at the end of the day, it comes down to getting customers, getting customers to profit. As we say, the first commandment of entrepreneurship is the single necessary and sufficient condition for a business is a paying customer. So you have to focus on getting paying customers that are in a less expensive way, in a more profitable way, and keeping them and making them happy, and then scaling the business.

So all the things you mentioned fit into this framework, like, do you use social media to acquire customers? Then that’s reducing cost of customer acquisition. Or do you use them to increase your lifetime value? That’s a different part of the equation. But do you use it to interface with them to find out their needs and wants and opportunities? this tool, we see and we’re already using it, it can dramatically shrink the entrepreneurial process of creating a new venture by as much as 90% in parts of it.

You still have to do primary market research, but a lot of the secondary market research you have to do, we can just do that in 15 minutes.

The best knowledge is not going to come from one institution, from one zip code. If we’re getting serious about pushing the field of entrepreneurship and raising the bar for it, we need to build a collaborative knowledge base that’s shared amongst all people. You’ve got to have a common body of knowledge and things that are agreed on, and those things should be agreed on based on evidence, not storytelling or who debates the best.

ALISON BEARD: Yeah. And how are you making sure that your style of disciplined entrepreneurship is spreading throughout the world, not just in Cambridge, not just in the United States?

BILL AULET: We’re not a for-profit. We have a terrible business model, Alison. It’s called, we create knowledge and give it away to the rest of the world to create positive impact. And so everything we do is open-sourced. And we need to take the long view here. And we have that, if you call it business model, to think long-term. And that’s what we should do. That is our role in society, and we should not back down from that at all.

ALISON BEARD: Once would-be startup founders have gone through all of your steps, there is still the problem of financing and finding investors. So how do you advise your students and executives you work with to go about that right now?

BILL AULET: Well, the first thing is there’s lack of confidence and knowledge about finance. I have a free book now called Finance for Entrepreneurs. We just have to break down that and demystify finance in a lot of ways first.

And then secondly, and I tell my students this all the time, and some listen and some don’t, is, “You want to get funding? Listen to what I have to say. The best way to get funding is to build a great company. The slowest way to get funding is to go try to play a game where you’re convincing the VCs you have what they want. Just go out and build a great business and they will find you. And by the way, there’s a great way to get funding. It’s called build a product that customers want and get them to pay you for it. And then guess what? You have money. And by the way, once you get that money, that’s validation that will help you raise it from other people.”

ALISON BEARD: Terrific, Bill. Well, thank you so much for joining me and definitely giving me hope that there are entrepreneurs out there who are going to make the world a better place.

BILL AULET: Thank you very much for having me on IdeaCast , and I look forward to any feedback.

ALISON BEARD: That’s Bill Aulet, professor at the MIT Sloan School of Management and author of the newly updated and expanded Disciplined Entrepreneurship: 24 Steps to a Successful Startup. His colleague Paul Cheek, recently released the follow-up, Disciplined Entrepreneurship: Startup Tactics.

And we have more episodes and more podcasts to help you manage your team, your organization, and your career, find them at HBR.org/podcasts or search HBR in Apple Podcasts, Spotify, or wherever you listen.

Thanks to our team, senior producer Mary Dooe, associate producer Hannah Bates, audio product manager Ian Fox, and senior production specialist Rob Eckhardt. And thanks to you for listening to the HBR IdeaCast . We’ll be back with a new episode on Tuesday. I’m Alison Beard.

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Entrepreneurship as Problem-Solving

Spotify Co-Founder Daniel Ek shares his very early experiences with entrepreneurship, which came about due to a need to solve problems. Ek also provides his definition of an entrepreneur, as “someone that has an itch for a problem, and is annoyed enough by that problem to seek a solution for it.”

Video clips from: A Playlist for Entrepreneurs [Entire Talk]

Execution is 95 percent, the big, hairy, audacious goal of spotify, solving a world of product problems, leading distributed teams, don't say yes to everything, opportunities in sensors and smart devices, product innovations can reduce piracy.

The Ethics of Innovation [Entire Talk]

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Leadership in a Digital World

The duty of digital leaders, ethics in emerging technologies, disproportionate job displacement.

A Brainy Approach to Innovation [Entire Talk]

Embodying Innovation

Mind control of machines, pivoting toward impact, automating legal consulting, confessions of a ‘cyber-optimist'.

Taking a Lead From Tech [Entire Talk]

‘What Would Different Look Like?'

Realities of startup life, essential but unsung skills, a blank invitation, choose your peers wisely.

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Why Problem-Solving Skills Are Essential for Leaders in Any Industry

• 17 Jan 2023

Any organization offering a product or service is in the business of solving problems.

Whether providing medical care to address health issues or quick convenience to those hungry for dinner, a business’s purpose is to satisfy customer needs .

In addition to solving customers’ problems, you’ll undoubtedly encounter challenges within your organization as it evolves to meet customer needs. You’re likely to experience growing pains in the form of missed targets, unattained goals, and team disagreements.

Yet, the ubiquity of problems doesn’t have to be discouraging; with the right frameworks and tools, you can build the skills to solve consumers' and your organization’s most challenging issues.

Here’s a primer on problem-solving in business, why it’s important, the skills you need, and how to build them.

Access your free e-book today.

What Is Problem-Solving in Business?

Problem-solving is the process of systematically removing barriers that prevent you or others from reaching goals.

Your business removes obstacles in customers’ lives through its products or services, just as you can remove obstacles that keep your team from achieving business goals.

Design Thinking

Design thinking , as described by Harvard Business School Dean Srikant Datar in the online course Design Thinking and Innovation , is a human-centered , solutions-based approach to problem-solving and innovation. Originally created for product design, design thinking’s use case has evolved . It’s now used to solve internal business problems, too.

The design thinking process has four stages :

• Clarify: Clarify a problem through research and feedback from those impacted.
• Ideate: Armed with new insights, generate as many solutions as possible.
• Develop: Combine and cull your ideas into a short list of viable, feasible, and desirable options before building prototypes (if making physical products) and creating a plan of action (if solving an intangible problem).
• Implement: Execute the strongest idea, ensuring clear communication with all stakeholders about its potential value and deliberate reasoning.

Using this framework, you can generate innovative ideas that wouldn’t have surfaced otherwise.

Creative Problem-Solving

Another, less structured approach to challenges is creative problem-solving , which employs a series of exercises to explore open-ended solutions and develop new perspectives. This is especially useful when a problem’s root cause has yet to be defined.

You can use creative problem-solving tools in design thinking’s “ideate” stage, which include:

• Brainstorming: Instruct everyone to develop as many ideas as possible in an allotted time frame without passing judgment.
• Divergent thinking exercises: Rather than arriving at the same conclusion (convergent thinking), instruct everyone to come up with a unique idea for a given prompt (divergent thinking). This type of exercise helps avoid the tendency to agree with others’ ideas without considering alternatives.
• Alternate worlds: Ask your team to consider how various personas would manage the problem. For instance, how would a pilot approach it? What about a young child? What about a seasoned engineer?

It can be tempting to fall back on how problems have been solved before, especially if they worked well. However, if you’re striving for innovation, relying on existing systems can stunt your company’s growth.

Related: How to Be a More Creative Problem-Solver at Work: 8 Tips

Why Is Problem-Solving Important for Leaders?

While obstacles’ specifics vary between industries, strong problem-solving skills are crucial for leaders in any field.

Whether building a new product or dealing with internal issues, you’re bound to come up against challenges. Having frameworks and tools at your disposal when they arise can turn issues into opportunities.

As a leader, it’s rarely your responsibility to solve a problem single-handedly, so it’s crucial to know how to empower employees to work together to find the best solution.

Your job is to guide them through each step of the framework and set the parameters and prompts within which they can be creative. Then, you can develop a list of ideas together, test the best ones, and implement the chosen solution.

Related: 5 Design Thinking Skills for Business Professionals

4 Problem-Solving Skills All Leaders Need

1. problem framing.

One key skill for any leader is framing problems in a way that makes sense for their organization. Problem framing is defined in Design Thinking and Innovation as determining the scope, context, and perspective of the problem you’re trying to solve.

“Before you begin to generate solutions for your problem, you must always think hard about how you’re going to frame that problem,” Datar says in the course.

For instance, imagine you work for a company that sells children’s sneakers, and sales have plummeted. When framing the problem, consider:

• What is the children’s sneaker market like right now?
• Should we improve the quality of our sneakers?
• Should we assess all children’s footwear?
• Is this a marketing issue for children’s sneakers specifically?
• Is this a bigger issue that impacts how we should market or produce all footwear?

While there’s no one right way to frame a problem, how you do can impact the solutions you generate. It’s imperative to accurately frame problems to align with organizational priorities and ensure your team generates useful ideas for your firm.

To solve a problem, you need to empathize with those impacted by it. Empathy is the ability to understand others’ emotions and experiences. While many believe empathy is a fixed trait, it’s a skill you can strengthen through practice.

When confronted with a problem, consider whom it impacts. Returning to the children’s sneaker example, think of who’s affected:

• Your organization’s employees, because sales are down
• The customers who typically buy your sneakers
• The children who typically wear your sneakers

Empathy is required to get to the problem’s root and consider each group’s perspective. Assuming someone’s perspective often isn’t accurate, so the best way to get that information is by collecting user feedback.

For instance, if you asked customers who typically buy your children’s sneakers why they’ve stopped, they could say, “A new brand of children’s sneakers came onto the market that have soles with more traction. I want my child to be as safe as possible, so I bought those instead.”

When someone shares their feelings and experiences, you have an opportunity to empathize with them. This can yield solutions to their problem that directly address its root and shows you care. In this case, you may design a new line of children’s sneakers with extremely grippy soles for added safety, knowing that’s what your customers care most about.

Related: 3 Effective Methods for Assessing Customer Needs

3. Breaking Cognitive Fixedness

Cognitive fixedness is a state of mind in which you examine situations through the lens of past experiences. This locks you into one mindset rather than allowing you to consider alternative possibilities.

For instance, your cognitive fixedness may make you think rubber is the only material for sneaker treads. What else could you use? Is there a grippier alternative you haven’t considered?

Problem-solving is all about overcoming cognitive fixedness. You not only need to foster this skill in yourself but among your team.

4. Creating a Psychologically Safe Environment

As a leader, it’s your job to create an environment conducive to problem-solving. In a psychologically safe environment, all team members feel comfortable bringing ideas to the table, which are likely influenced by their personal opinions and experiences.

If employees are penalized for “bad” ideas or chastised for questioning long-held procedures and systems, innovation has no place to take root.

By employing the design thinking framework and creative problem-solving exercises, you can foster a setting in which your team feels comfortable sharing ideas and new, innovative solutions can grow.

How to Build Problem-Solving Skills

The most obvious answer to how to build your problem-solving skills is perhaps the most intimidating: You must practice.

Again and again, you’ll encounter challenges, use creative problem-solving tools and design thinking frameworks, and assess results to learn what to do differently next time.

While most of your practice will occur within your organization, you can learn in a lower-stakes setting by taking an online course, such as Design Thinking and Innovation . Datar guides you through each tool and framework, presenting real-world business examples to help you envision how you would approach the same types of problems in your organization.

Are you interested in uncovering innovative solutions for your organization’s business problems? Explore Design Thinking and Innovation —one of our online entrepreneurship and innovation courses —to learn how to leverage proven frameworks and tools to solve challenges. Not sure which course is right for you? Download our free flowchart .

About the Author

Entrepreneurship as Innovation and Problem Solving

Q.4. (iii) Explain a) Smart Mobility,

Entrepreneurship as Innovation and Problem Solving, Entrepreneurship, Class 11 Revision Notes | Entrepreneurship Class 11 - Commerce PDF Download

List the institutions which are contributing to the EDP (entrepreneurship development program).

The following are the institutions contributing to the EDP

• CEI – Centre for Entrepreneurship and Innovation
• EDII – Entrepreneurship Development Institution of India
• IIE – Indian Institute for Entrepreneurship
• NAYE – National Alliances of Young Entrepreneur. This is now renamed as FISME – Federation of Indian Micro and Small & Medium Enterprises
• NIESBUD – National Institute for Entrepreneurship and Small Business Development
• NIMSME – National Institute for Micro, Small and Medium Enterprises
• NSIC – National Small Industries Corporation
• REDI – Rural Entrepreneurship Development Institute
• SIDO – Small Industries Development Organization
• SISI – Small Industries Service Institutions
• TDC – Training and Development Center

What did you understand by the term social entrepreneur?

Roger L Martin and Sally Osberg defined the social entrepreneur as Social entrepreneur is the one who aims for value in the form of large-scale transformation benefit that accrues either to a significant segment of society or to society at large. Usually the population which is

• under-served
• or highly disadvantaged

do not have financial resources or political influence to achieve the transformational benefit on its own. Social entrepreneurs put all their efforts to help this population to achieve their transformational benefit.

Define insurable risks.

Insurable risks are those risks which conform to the specifications mentioned by various insurance policies. It is possible to forecast these risks. Through various measures the probability of these risks can be determined. Few examples of insurable risks are those related to life and property against fire, storm, riots, theft, fidelity by dishonest employees etc.

Define non-insurable risks.

The risks for which it is not possible to determine their probability are called non-insurable risks. Due to this reason it is not possible to forecast these risks. Few examples of non-insurable risks are those related to war, floods, earthquake, gambling, fluctuations in demand, fluctuations in price etc.

Define economic barriers.

For entrepreneurial growth we need the following factors to be available in abundance.

Non availability of these factors to the required levels is economic barrier.

What do you know about the social entrepreneur Vinoba Bhave?

Vinoba Bhave is a social entrepreneur who founded and led the Bhudaan Andolan (Land Gift movement). His movement led to significant land reforms. Around 7 million acres of land was redistribute among the landless poor and untouchables.

Briefly explain about Business Incubators.

Business incubation refers to the programs designed by the organizations to help the entrepreneurial organizations. The management of the incubators help these budding enterprises by supplying them the required service and resources. They also provide the required support. Some of the services and resources are

• Coaching, training, mentoring
• Physical space
• Networking with others
• Common services

These incubator vary depending on

• the enterprises they support
• their organizational structure
• type of service and support they provide

How does the business intelligence help the organizations?

Business intelligence refers to the capability of organizations to

• and organize

information. The information thus gathered is quantified and analyzed to derive new potential business opportunities. Once these opportunities are identified, effective strategies are prepared to implement them. This helps the business to

• Enhance the decision making process
• stay up to date in the market
• sustain the competition
• Improve the performance and productivity
• risk mitigation
• create new business opportunities
• attain business stability in the coming days

Name the prime business incubators in India.

The following are the prime business incubators in India.

• CIIE – Centre for Innovation, Incubation and Entrepreneurship, IIM, Ahmedabad
• IAN – Indian Angel Network
• NSRCEL – N S Raghavan Centre for Entrepreneurial Learning, IIM, Bangalore
• SINE – Innovation and Entrepreneurship, IIT Mumbai
• T-TBI – Technopark Technology Business Incubator, Kerala

Explain how the innovation of penicillin and pacemaker evolved as successful business ventures.

• Penicillin:  Penicillin was innovated by the scientist Sir Alexander Fleming and it led to a successful business venture. He was trying to innovate a wonder drug that could cure all the diseases. One day he threw all his experiments. Later he found that a mold contained in a contaminated Petri dish was dissolving all the bacteria in its surroundings. He then experimented with the mold and found that it has a highly efficient antibiotic. He named it as Penicillin. The sale of Penicillin brought about successful business ventures.
• Pacemaker: Pacemaker was invented by an electrical engineer John Hopps. He was doing research on hypothermia. He experiments were focused on restoring the body temperature using radio frequency. When he was conducting the experiments, he discovered that when the heart beating is affected by cooling, the heart beat can be restored by inducing artificial simulation. The idea led him to innovate the pacemaker. It became a successful business venture.

How do you make someone understand the difference between entrepreneurship and social entrepreneurship.

The following key differences distinguish an entrepreneur from a social entrepreneur.

What do you understand by the term ‘Cloud Computing’?

Cloud Computing refers to the networks used in computer and communication systems. It got its name as these networks are represented by the clouds in the drawings. Cloud computing is synchronously used for internet. In cloud computing, the organizations upload all the data and software on to a cloud network. The users can access this data and software remotely. These users can access high configuration computers in a time sharing manner. They can run various algorithms on the cloud network which will provide optimum use of the applications, infrastructure and platform. This is achieved through prioritized access to the CPU. This will also ensure that the user achieves high efficiency.

Describe the inception of KFC.

KFC was started in Corby, Kentucky, USA by Sanders. He was operating a gas service station. He noticed that the travelers visiting his service station were hungry and looking for some eatables. Sanders knew a secret blend of 11 herbs and spices with which he can prepare tasteful chicken recipe. He started to serve this recipe to the travelers. This recipe became a bit hit and to cope up the demand he started a restaurant. This lead to the inception of “KFC-Kentucky Fried Chicken”. During the initial stages of setting up an enterprise, how can you get advantage of the available incubators? The incubators can help a budding entrepreneur to get benefited from the following sources.

• Angel InvestorsThe incubators help the entrepreneurs connect with the angel investors, there by procuring the funds.
• BanksThey guide the enterprises through the loan procurement process
• Venture capitalistsThey work with the enterprises to prepare effective venture capital presentations. This in turn help the enterprises to get noticed by the venture capitalists and there by getting the required funds.
• Government agenciesThey educate the enterprises about various grant programs available from the government agencies to promote the enterprises. For example the incubators help entrepreneurs to take advantage of the programs like Technology NZ, NZTE etc.

What are the various factors responsible for internal risks in an enterprise? The following are the various factors responsible for internal risks.

• accidents or deaths in the industry
• Continuous lock-outs and strikes by the employee unions
• disloyalty by employees
• Efficient suppliers are not available
• Few or more incompetent people in top level positions
• Technological factors: Rapid changes in the technology. If the competitors are using the most recent technology, they will be able to produce much better quality products or services. This poses the risk of losing the market to the competitors.
• Any fire or accident
• Burglary or Theft
• Compensations to be paid to others, in the instances when the enterprise is responsible for any damage caused.
• Damages in transit
• Equipment breakdown

What are the various factors responsible for external risks in an enterprise? The following are the various factors responsible for the external risks affecting an enterprise.

• Changes in the consumer preferences and tastes
• Changes in income levels
• Changes in Output
• Changes in trade cycles
• Demand fluctuations
• Increased competition
• Inflation levels
• Price fluctuations
• Variations in world economy
• will adversely affect the business and pose big risk.
• Change in the government
• Communal clashes or riots
• Civil wars.
• Hostilities with the neighboring countries
• Changes in the government policies
• Changes in the consumer preferences and tastes: This will have a huge impact on the demand for the product or service

How does the personal barriers demotivate an entrepreneur?

When we analyze the society, there are only a small fraction of persons who would like to avail the entrepreneurial opportunities and become entrepreneurs. Whether it is a developing countries like India or highly developed countries like USA, the mindset of people towards the entrepreneurship is the same. Very few people establish an enterprise and the other opt for a different career. This is majorly due to two kinds of personal barriers preventing them from becoming an entrepreneur. The two varieties of personal barriers are described below.

• Perpetual: The perpetual barriers result in slowing down the growth of an entrepreneur and demotivates them. When people tackle a given situation without clear vision or they completely understand the situation wrongly and take a decision as per their understanding, they fail. This results in a negative perception. As a result they develop their own, often false, beliefs and prejudices about a business activity. This will leave them with a very small range of choices. For instance a person assuming that a particular type of business is suitable only for a particular segment will leave him with fewer choices.
• Motivational: An entrepreneur should consistently be motivated. They should not lose motivation because of any difficulties. This will become a barrier to their development and there by deviate them from their goal of establishing an enterprise. Many entrepreneurs feel demotivated when they encounter prolonged hurdles in a give situation. For instance, delay in procuring license for setting up an enterprise might result in a loss of enthusiasm in an entrepreneur.

How is smart mobility creating new business opportunities?

Mobile devices like smart phone help the businesses to run their operations smoothly and more efficiently. They improve the speed and accuracy of communication among people. These devices are widely adopted by the public and became a basic need. A report from a survey conducted by IDC (International Data Corporation) showed that the number of smart phones purchased by people have exceeded the number PCs sold in the fourth quarter of 2010. As of today, smart phones surpass the desktops and laptops in the usage of internet. These statistics provide new opportunities and result in new players emerging to cater the growing smart phone market and exploit it completely. The existing enterprises have to dispose their legacy systems and then adopt to this new technology. However, the upcoming enterprises, as they are starting from scratch, should be able to better implement new technologies and get benefited with this new are of opportunities. An example of this new technology wearable gadgets like a smart watch which is connected the smart phone or a Smart phone with an edge display

How is Information collection helping the enterprises to beat the competition?

The enterprises gather the consumer details and study the consumer behavior and preferences. They use this data to ensure that their products or services are providing consumer satisfaction. This helps the enterprises to win consumer confidence. It also helps them to keep themselves ahead of competition. For instance, a retail store can study the consumer details and find that their customers are mostly college students in the age group of 15 to 18 years. This helps them to ensure that their store is equipped with the products that is mostly purchased by this age group. With the technological advancements, various organizations started to employ different methods by using built-in sensors, social networking sites like facebook, google plus, Instagram, Whatsapp, email to gather the consumer related metrics. A report from a survey conducted by IDC (International Data Corporation)showed that the data collected like this will grow tremendously by 2020. As per an estimate this data will require 44 times more storage space as compared to the data collected in 2009. One such method used to gather data is by using telemetric operations. Telemetric operations are similar to GPS (Global positioning system). It will allow enterprises to gather and store the data using telecommunication equipment that can control remote objects. The telemetric operations were originally developed for use in the healthcare industry and to gather medical informatics, it is most widely used in the automobile sector.

By seeing which characteristics can you determine that a person is a social entrepreneur.

We can assume that a person is a social entrepreneur if that person possesses the following characteristics.

• Accountable: They feel accountable about the people they are serving. They always seek feedback of the impact of their actions on the people they are working with. So, they always think about the impact their actions on their beneficiaries. Simultaneously, they feel accountable to the investors as the investors are concerned about the impact the social entrepreneurs are making on the society and see whether the proposed social changes are taking place or not.
• Socially aware: The primary goal of social entrepreneurs is the social improvement. They are not concerned about the profit generation. They feel successful when their efforts are bringing the required social improvement but not because of the monetary profitability.
• Social Catalysts: They have a vision to bring about the social improvement by changing the prevailing social systems. As mentioned by J. Gregory Dees, the social improvement brought by the social entrepreneurs will not just improve the society in their vicinity but it will trigger a movement to trigger this change all over the world. Whether the area of reformation is that of arts, economic reform, education, environment, health care or any other social field, it act as a catalyst and spread the movement.
• Opportunity-Seeking:  They pursue their goal persistently and mould the hurdles into opportunities to nurture and refine their business.
• Innovative:  Innovate creative solutions to the problems. They are not shaken up by a fall back but they learn from failures and improve continuously.

Give a brief about the businesses that are emerged as a result of innovation in the technology.

With the advancements in the technology, new businesses that tap the potential of these technologies are emerging in the market.

• Businesses specialized in Information Collection: The enterprises gather the consumer details and study the consumer behavior and preferences. They use this data to ensure that their products or services are providing consumer satisfaction. This helps the enterprises to win consumer confidence. It also helps them to keep themselves ahead of competition. For instance, a retail store can study the consumer details and find that their customers are mostly college students in the age group of 15 to 18 years. This helps them to ensure that their store is equipped with the products that is mostly purchased by this age group. With the technological advancements, various organizations started to employ different methods by using built-in sensors, social networking sites like facebook, google plus, Instagram, Whatsapp, email to gather the consumer related metrics. A report from a survey conducted by IDC (International Data Corporation)showed that the data collected like this will grow tremendously by 2020. As per an estimate this data will require 44 times more storage space as compared to the data collected in 2009. One such method used to gather data is by using telemetric operations. Telemetric operations are similar to GPS (Global positioning system). It will allow enterprises to gather and store the data using telecommunication equipment that can control remote objects. The telemetric operations were originally developed for use in the healthcare industry and to gather medical informatics, it is most widely used in the automobile sector.
• Businesses specialized in Smart Mobility:  Mobile devices like smart phone help the businesses to run their operations smoothly and more efficiently. They improve the speed and accuracy of communication among people. These devices are widely adopted by the public and became a basic need. A report from a survey conducted by IDC (International Data Corporation) showed that the number of smart phones purchased by people have exceeded the number PCs sold in the fourth quarter of 2010. As of today, smart phones surpass the desktops and laptops in the usage of internet. These statistics provide new opportunities and result in new players emerging to cater the growing smart phone market and exploit it completely. The existing enterprises have to dispose their legacy systems and then adopt to this new technology. However, the upcoming enterprises, as they are starting from scratch, should be able to better implement new technologies and get benefited with this new are of opportunities. An example of this new technology wearable gadgets like a smart watch which is connected the smart phone or a Smart phone with an edge display
• Businesses specialized in Cloud Computing: Cloud computing refers to the networks used in computer and communication systems. It got its name as these networks are represented by the clouds in the drawings. Cloud computing is synchronously used for internet. In cloud computing, the organizations upload all the data and software on to a cloud network. The users can access this data and software remotely. These users can access high configuration computers in a time sharing manner. They can run various algorithms on the cloud network which will provide optimum use of the applications, infrastructure and platform. This is achieved through prioritized access to the CPU. This will also ensure that the user achieves high efficiency.
• Businesses specialized in social media: As internet became more affordable, several socializing networks like Whatsapp, Facebook, Twitter, Google Hangouts are becoming more popular. Though they were limited to the desktop users earlier, with the advancement of smart mobile devices like smart phones, tablets, e-book readers, the use of social networking became more popular. Companies started to tap the power of these platforms. They help the organizations to study the behaviour of the user and direct their marketing efforts to these users. New business also emerged that will tap the power of these networks and help other organizations to better reach their targeted consumers through the powerful social media.

What do you know about enterprise Shri Mahila Griha Udyok Lijjat Papad?

Six Gujarati women started Shri Mahila Griha Udyok Lijjat Papad in Bombay (present Mumbai). Their purpose was to create a revenue stream through a food product.

They took a loan of Rs.80/- from Chhaganlal Karamsi Parekh. They acquired a papad venture run by Lakshmidas bhai, as it was running in losses. Their policy not to take any donation or help from others even if the business goes bankrupted. They started production on their terrace on 15th March, 1959. The first output was 4 packets. The output was sold to a buyer in Bhuleshwar.

They were initially making papads in a low and high quality. As suggested by their adviser, Chhaganlal Karamsi Parekh, they started to make only high quality papads.

The enterprise started to grow as a cooperative system. Though they recruited all age groups initially, they imposed 18 years as the age limit, later on. Within a quarter they had 25 members. As the profits grew, they procured other infrastructure like storage equipment, utensils, cooking equipment etc. The problems like not being able to dry the papads due to rains were resolved by procuring papad drying equipment. After one year the business earned good profits.

They popularity and the members started to grow. After 3 years, they had 300 members. This brought up space issues. So, they asked the members to take the raw material to home, prepare papads and bring them back. If the quality was low members were given a warning. If it repeats they were terminated from membership.

As the number of branches increased and they employed other administrative staff like accountants etc at each branch. Currently, they have thousands of members across Maharashra and Gujarat. The profits or losses were equally distributed/born by all the members. The share is decided by a committee of 21 members.

Lijjat papad became a successful venture in India and started to export papads to foreign countries too.

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Entrepreneurship and the Online MBA: Building Business Acumen and Entrepreneurial Skills

Why should aspiring entrepreneurs consider an MBA? Nike is a billion-dollar company and a business idea that was born during a project in an MBA program. That’s right. Nike’s founder Phil Knight developed the idea while enrolled in an MBA program at Stanford. 1

Entrepreneurship has emerged as a driving force behind innovation, economic growth and societal impact. Pursuing an online MBA has become an increasingly popular pathway for individuals looking to develop the skills, knowledge and network needed to succeed as entrepreneurs.

In this blog post, we will explore how online MBA programs provide aspiring entrepreneurs with the tools, leadership skills, resources and opportunities to launch, manage and grow their own businesses.

Introduction to Entrepreneurship and the Online MBA

Entrepreneurship is the process of identifying opportunities, taking risks, and organizing resources to create value and pursue new business ventures. Entrepreneurs demonstrate creativity, initiative, and resilience in starting and managing businesses, often with the goal of generating profits, driving innovation and addressing unmet needs in the marketplace.

Entrepreneurship involves a combination of skills including the following: 2

• Innovation and Creativity: Entrepreneurs drive innovation by developing new products, services and business models that challenge the status quo and address evolving consumer demands. They bring fresh ideas, perspectives and approaches to problem-solving, fostering creativity and pushing boundaries
• Economic Growth and Job Creation: Entrepreneurship can drive economic growth and prosperity, fueling job creation, wealth generation and income opportunities. Successful entrepreneurs create value not only for themselves but also for employees, investors, suppliers, and communities. Startups and small businesses play a vital role in driving innovation and competitiveness in the economy
• Market Competition and Disruption: Entrepreneurs introduce competition and disrupt established industries, leading to increased efficiency, lower prices and greater consumer choice. By challenging traditional business models, entrepreneurs stimulate market dynamics, encourage entrepreneurship and foster a culture of continuous improvement and adaptation
• Problem-Solving and Social Impact: Entrepreneurs identify a problem and work to solve that problem by developing innovative solutions and business models that create social, environmental, and economic value. Social entrepreneurs, in particular, leverage business principles to tackle pressing issues such as poverty, inequality, healthcare, education and environmental sustainability, driving positive change and social impact 3

Benefits of Combining Entrepreneurship and an Online MBA

An online MBA can provide aspiring entrepreneurs with valuable skills, knowledge and resources to succeed in launching and managing their own businesses. Combining academic learning with practical experience, networking, and support, MBA programs provide a solid foundation for aspiring entrepreneurs. 4

Pursuing an online MBA can offer numerous advantages, including: 4

• Access to Resources and Support: MBA students have access to a wealth of resources and support services, including online libraries, research databases, career services and academic advisors. These resources can provide valuable guidance, information and assistance to aspiring entrepreneurs
• Entrepreneurial Education and Training: Many MBA programs offer specialized courses, concentrations, or electives in entrepreneurship and innovation, providing targeted education and training in entrepreneurial concepts, strategies and best practices. These courses cover topics such as opportunity recognition, business modeling, venture financing and growth strategies

Online MBA Program Overview

MBA programs offer a flexible and accessible way for working professionals to pursue advanced education, enhance their skills, and pursue career advancement while balancing their career, personal commitments and other responsibilities. MBA programs offer a comprehensive curriculum, interactive learning experiences and personalized support. Students can achieve their goals without sacrificing their work-life balance. 4

Interactive Learning

MBA programs utilize advanced interactive learning tools and technologies to engage students in active learning experiences. This technology enhances the educational experience for online students and prepares students for a world that requires them to be tech-savvy. Online MBA courses can include virtual discussions, group projects, and problem-solving activities. Interactive learning fosters collaboration, communication and teamwork skills, which are essential in the business world.

Flexibility

Flexibility is a hallmark of online MBA programs, with asynchronous learning options that enable students to study at their own pace and schedule, rather than adhering to rigid class times. This flexibility is especially beneficial for working professionals who may have irregular work hours, travel requirements or family obligations. Additionally, MBA programs often offer part-time or accelerated study options, allowing students to tailor their course load to fit their individual needs and preferences. 4

Accessibility

Accessibility is another key advantage of online MBA programs , as they allow students to access high-quality education from anywhere in the world. Students can enroll in top-ranked programs without having to relocate or commute to campus. MBA programs also offer a wide variety of specializations and concentrations, allowing students to customize their education to align with their career goals and interests. 4

Entrepreneurial Skill Development

MBA programs offer opportunities to develop critical entrepreneurial skills. An online MBA curriculum covers a broad range of business topics, including finance, marketing, operations, strategy and leadership. Through case studies, group projects and real-world simulations, students learn to analyze complex business situations, identify opportunities, evaluate risks and make informed decisions to address challenges and capitalize on opportunities in dynamic business environments. Entrepreneurs gain a well-rounded foundation to launch and grow their ventures successfully. 4

Case Studies

Incorporating case studies into the online MBA curriculum can expose students to real dilemmas and decisions that businesses face. Research has shown that students are more successful at recalling concepts when they are presented in a case. 5

Case studies can cover a range of topics within an entrepreneurship program: testing an idea, researching the market, creating a prototype, market strategy or brand, managing people and culture and more. Case studies in entrepreneurship typically focus on the challenges faced by the entrepreneur. Students use the case facts to analyze a dilemma and justify their decisions. Analyzing case studies allows students to enhance problem-solving and decision-making skills. Using case studies can facilitate collaboration and expose students to different perspectives in business. 6

Mentoring and Networking Opportunities

MBA programs provide networking opportunities and offer executive coaching or mentoring programs.

Networking Opportunities

MBA programs provide opportunities for networking with fellow students, alumni, faculty, and industry professionals from diverse backgrounds and industries. Building a strong professional network can offer valuable connections, mentorship, partnerships and opportunities for collaboration, funding, and business development for a large or small business.

Mentorship Programs

Through MBA mentorship programs, experienced professionals or faculty members can provide guidance, feedback, and mentorship to students, helping them identify their strengths and areas for development. 7 Mentorship offers a personalized approach to learning. MBA mentorship programs can provide a structured framework and provide guidance on communication, decision-making, conflict resolution, strategic management and other skills. Students are given a safe space to make mistakes and experiment. 5

Want to Own Your Own Business? Build Your Skills With William & Mary

Pursuing an MBA can enhance your business skills and advance your career as an entrepreneur. William & Mary’s Online MBA program offers numerous advantages for aspiring entrepreneurs. Prepare to lead in today’s challenging, rapidly changing business environment.

As you study on your own schedule, you'll sharpen your design thinking and problem-solving skills so that you can successfully apply them in fast-paced business environments. Through our innovative learning platform, you can engage with a support network of world-class faculty and peers and expand your network to include accomplished colleagues online and around the world.

Want to learn more? Schedule a call with an admissions outreach advisor today.

• Retrieved on April 2, 2024, from f1gmat.com/billionaire-entrepreneurs-mba
• Retrieved on March 26, 2024, from linkedin.com/pulse/why-entrepreneurs-important-economy-james-dooley-puvje
• Retrieved on March 26, 2024, from investopedia.com/terms/e/entrepreneur.asp
• Retrieved on March 26, 2024, from emeritus.org/blog/benefits-of-online-mba/
• Retrieved on March 15, 2024, from hbr.org/2021/12/what-the-case-study-method-really-teaches
• Retrieved on March 26, 2024, from highereducationdigest.com/enhancing-undergraduate-learning-in-entrepreneurship-through-case-studies/
• Retrieved on March 15, 2024, from linkedin.com/pulse/crucial-role-mentorship-leadership-development-walter--ckjtf?trk=public_post

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• MCQs – Nature & Significance of Management
• MCQs- Principles of Management
• MCQs – Chapter – Business Environment
• MCQs – Chapter Planning
• MCQs – Chapter – Organizing
• MCQs – Chapter Staffing
• MCQs – Chapter – Directing PART-1
• MCQs – Chapter – Directing – Part-2
• MCQs- Chapter Controlling
• MCQs- Chapter – Financial Management
• MCQs – Chapter – Marketing Management Part-1
• MCQs- Chapter- Marketing Management -Part-2
• MCQs – Chapter- Marketing Management – Part-3
• Case Studies- Principles of Management
• Case Study – Business Environment
• Case Study-Planning
• Case Study-Organizing
• Case Study- Staffing
• Case Study-Directing
• Case Study – Chapter Controlling
• MCQs – Ch-2 – An Entrepreneur – Part-1
• MCQs – Ch-2 – An Entrepreneur – Part-2
• Ch-3 MCQs for ENTREPRENEURIAL JOURNEY
• MCQs – Ch-4 Entrepreneurship As Innovation And Problem Solving
• Ch-5 MCQs Analysis of Market Env & Market Research
• CH-6 MCQs Unit of sale – Unit cost – Gross Profit
• Unit-2 Entrepreneurial Planning
• Download PDF| Unit-3 Marketing Strategies
• Download PDF | UNIT-4 Enterprise Growth Strategies
• Download PDF | UNIT-6 Resource Mobilization
• Download PDF |Unit 1 ENTREPRENEURSHIP
• Download PDF | Unit-3 Marketing Strategies
• Download PDF| UNIT-4 | Enterprise Growth Strategies

MCQs – Ch-4 Entrepreneurship As Innovation And Problem Solving

Entrepreneurship – As Innovation & Problem Solving

43 – One Mark Questions – Specially Designed for CBSE Class 11 Students Love to learn

Q1: The inventor of X- Rays is :

(a) Wilhem Roentgen                                     (c) Sir Alexander Fleming

(b) Percy Spencer                                            (d) George Crum

Ans: (a) Wilhem Roentgen

Q2: Razaq is a native of the beautiful valley of Kashmir. His family owns an apple orchard. During his summer break, he decided to help his family at the orchard. He observed that a lot of time was lost in plucking apples. Being of an innovative mind, he worked on solving the above problem and made a simple plucking device attached with a net land a knife. This saved considerable time and money.

Identify the role played by Razaq.

(a) Innovator                                                   (c) Both (a) and (b)

(b) Problem Solver                                          d) None of the above

Ans: (c) Both (a) and (b)

Q3: Dr Verghese Kurien is the founder of______________.

(a) Selco                                                          (c) Barefoot College

(b) Amul Diary                                               (d) SEWA

Ans: (b) Amul Diary

Q4: What does GPS stands for?

(a) Global Positioning Systems                      (c) Global Problem Solver

(b) Giant Positioning Systems                        (d) Great Problem Solver

Ans: (a) Global Positioning Systems

Q5: Which of the following institute was established by the government with the objective of supplying machinery and equipment to small enterprises as on hire purchase system.

(a) National Small Industries Corporation     (c) Entrepreneurship Development Institution of                                                                        India

(b) Small Industries Service Institution          (d) Training and development center

Ans: (a) National Small Industries Corporation

Q6: The inventor of Penicillin is :

Ans: (c) Sir Alexander Fleming

Q7: Arun is a native of the beautiful valley of Kashmir. His family owns an apple orchard. During his summer break, he decided to help his family at the orchard. He observed that a lot of time was lost in plucking apples. Being of an innovative mind, he worked on solving the above problem and made a simple plucking device attached with a net land a knife. This saved considerable time and money.

Identify the role played by Arun

(a) Innovator                                       (c) Both (a) and (b)

(b) Problem Solver                              (d) None of the above

Q8: Bunker Roy is the founder of______________.

(a) Selco                                  (c) Barefoot College

(b) Amul Diary                       (d) SEWA

Ans: (c) Barefoot College

Q9: What does IDC stands for?

(a)International data collection                       (c) International data collector

(b) International data corporation                   (d) None of the above

Ans: (b) International data corporation

Q10: In which of the following a financial institution buys the accounts receivables of a company and pays up to 80% to 90% of the amount immediately and the balance, after deducting his charges, when the customer pays the debt.

(a) Tax holiday Scheme                                  (c) Small industry cluster development program

(b) Factoring Services                                     (d) National equity fund scheme

Ans: (b) Factoring Services

Q11: What is the full form of KFC?

(a) Kingfisher fried chicken                            (c) Kentucky fried chicken

(b) Kampire fried chicken                               (d) Kenya Fried chicken

Ans: (c) Kentucky fried chicken

Q12: The inventor of Potato chips is :

Ans: (d) George Crum

Q13: : The inventor of the Pacemaker is :

(a) Wilhem Roentgen                                     (c) Sir Alexander Fleming

(b) Percy Spencer                                            (d) John hopps

Ans: (d) John hopps

Q14: The inventor of Microwave ovens is :

Ans: (b) Percy Spencer

Q15:” Social entrepreneurs is which combines the passions of a social mission with an image of business-like discipline, innovation, and determination”.

Who has quoted the above definition of Entrepreneurship?

(a) Martin & Osberg                                       (c) Mohammad Yunus

(b) J. Gregory Dees                                         (d) Richard Cantillon

Ans: (b) J. Gregory Dees

Q16: “ the Social entrepreneur aims for the value in the form of large scale transformational benefits that accrues either to a significant segment of society or to society at large.”

(b) J. Gregory Dees                                         (d) Richard Cantillon

Ans: (a) Martin & Osberg

Q17: Ajay and Vijay are arguing on the fact that there is no difference between the objective of entrepreneur and social entrepreneur. Ajay is of the view that The final objective of Social entrepreneurs is wealth creation but Vijay is of the view that for social entrepreneurs wealth creation is a means to an end.

Who is correct?

(a) Ajay                                                           (C) Both Ajay and Vijay

(b) Vijay                                                          (d) None of the two

Ans: (b) Vijay

Q18: While appreciating the efforts of Arun,an upcoming entrepreneur, his Childhood friend Varun told him that I always knew that you have qualities of being a social entrepreneur because you always had your out of the box and ready to apply ideas to new solutions. Which of the following characteristics of social entrepreneurs is discussed in the above case?

(a) Opportunity seeking                                  (c) Accountable

(b) Resourceful                                               (d) Innovative

Ans: (d) Innovative

Q19: A Social entrepreneur has a quality of continuously asking himself that “Am I creating value for the people I am serving? Do I understand their needs?”

Which of the following characteristic of Social entrepreneur is highlighted above?

Ans: (c) Accountable

Q20: Verghese Kurian is the founder of______________.

Q21: Ela Bhatt is the founder of______________.

Ans: (d) SEWA

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Groundbreaking innovations win big at the 17th New Venture Challenge Finals

The Foodwise startup team, Jennifer Bundrant (Leeds School of Business, '23 alum.), Hashirr Lukmahn (College of Engineering and Applied Science), Emma Bonerb (Leeds School of Business) and Byron Patten (Leeds School of Business) pose with friends and family and their $100,000 prize check. Photo: Glenn Asakawa, CU Boulder.

The 2024 New Venture Challenge (NVC) culminated in a final showcase on April 17 in front of a live audience cheering on the University of Colorado Boulder’s next big innovations. At an event filled with great ideas and even greater entrepreneurial spirit, five teams competed for $165,000 in prize money. 

DiStefano told the packed theater that, as a top-ranked collegiate entrepreneurial competition, NVC has launched 1,176 new ventures and distributed $1.4 million in funding over its history with winners representing a range of industries, including environmental sustainability, healthcare, music and entertainment, food and agricultural and manufacturing. 

He introduced Stan Hickory, director of NVC and the Innovation & Entrepreneurship Initiative, which “brings together and elevates efforts happening across campus and the community to create massive impact,” said DiStefano. “Through interdisciplinary work and collaboration, CU Boulder is expanding beyond the classroom and labs to enrich communities and address pressing societal changes through entrepreneurship.”

Hickory told the crowd that the five finalists sharing the stage at the event emerged from a field of 92 ventures and represent every corner of the university and the larger community. “The New Venture Challenge is truly the crown jewel of what we do,” said Hickory. “I love seeing the Front Range entrepreneurial community assemble at the Boulder Theater to support students, faculty and staff as they launch their ventures,” said Hickory.

Co-emcees Dianne Myles, CEO of Dope Mom Life and Olivia Omega, senior director of marketing and communications of the Denver Scholarship Foundation, introduced the judges of the live venture pitches, including Wanda James, CU regent and CEO of Simply Pure; Natty Zola, partner at Matchstick Ventures; Kevin Allen, COO of Windpact and co-founder of Access Mode and Afshin Safavi, founder, CEO and president of Colorado Health and Tech Centers.

Representatives from five teams pitched new solutions for reducing food waste, expanding home ownership, improving hotel pricing, detecting soil health and tech-assisted sports management.

Judges praised each venture’s presentation and pressed each team with questions about their business concepts. After a deliberation period, the judges’ picks were announced, and confetti rained down on the stage. Each finalist walked away with a check—the two top teams netted $145,000 in combined winnings, and the additional three teams split $20,000 in prize money. 

Innovations emerging across the CU ecosystem

Take, for example, FoodWise, a venture that was born out of last fall's Sustainability Hackathon . “These were students who didn’t have an idea or a team,” said Hickory. “They came to the hackathon and saw a problem and came together to find a solution.” Brainstorming after that session, co-founders Emma Bonerb and Byron Patten initially considered starting a company that would mitigate food waste in restaurant inventory and distribution. But after talking to industry experts, “We realized the bigger problem was actually the overpreparation of ingredients rather than inventory going bad. That sparked our current concept,” said Bonerb.

This year’s general competition winners included finalists in two earlier NVC competitions; FoodWise won $3,000 and AFFIX was a finalist at the Women Founders Competition   hosted by the Deming Center for Entrepreneurship , and PricingService.ai was a finalist in the inaugural  Deep Tech Competition   hosted by   Venture Partners at CU Boulder .

The next generation of founders and funders

The New Venture Challenge is a signature program of the Innovation & Entrepreneurship Initiative  and is CU Boulder’s “flight simulator” for those striving to make real-world impact through new endeavors. The program gives aspiring problem-solvers and creatives a chance to build impactful non-profit or for-profit ventures through entrepreneurial events and programming, community support, mentorship and—ultimately—the chance to compete for funding.

The caliber of past NVC participants over its 17-year history and the proven strength of startup creation at CU Boulder has attracted entities like sponsor Kickstart, which brought $144,000 of direct investment to this year’s top two teams. Hickory called their partnership in the event a “game-changer.”

Kickstart is a seed-stage venture capital firm “on a mission to help build great startups in the Mountain West,” said partner Dalton Wright. At the NVC finals, they launched their ‘14 Founders’ initiative which will ultimately inject $2 million of fresh capital into first founders in the state. “The focus of 14 Founders is to inspire, educate, discover and connect the next generation of tech founders and venture capitalists in Colorado while also celebrating the pioneers of the ecosystem and learning from their stories,” said Wright.

Learning and support to last a lifetime

In his remarks, DiStefano acknowledged the broader impact of entrepreneurship programming. “It’s impossible to calculate the valuable internal benefits the program has built for hundreds who have participated—those problem-solving, communication and collaboration skills that will serve New Venture Challenge alumni throughout their personal and professional careers.”

Those advantages are keenly felt by this year’s NVC teams. “I've realized that CU Boulder really is the perfect place to become an entrepreneur,” said FoodWise founder Bonerb. “I am surrounded by so many valuable resources and people, but most importantly, a community who wants to see us succeed.” 

Refr Sports founder Sorock agreed. “As much as we want to build a successful company, ultimately, we are just looking to learn and grow as people, entrepreneurs and leaders. The NVC platform was an amazing opportunity for us to surround ourselves with like-minded people who are dedicated to being involved in our growth and progress. For this, I am extremely grateful.”

A constellation of world-class entrepreneurship classes, mentorship and programs like NVC have put CU Boulder among the top universities for entrepreneurship. Hickory said the NVC program is so successful, in part, due to the guidance of over 350 mentors and more than 125 judges. “The community support goes far beyond the finals,” he said. 

“To me, that is the magic of the ecosystem here at CU Boulder and the value of the NVC. We provide a place for impactful ideas to be born and a mechanism to launch [them] to create impact.”

2024 NVC General Competition Prizes

$100,000 First Place Prize: FoodWise

Team (from left to right in photo): Jennifer Bundrant, ( Leeds School of Business , '23), Hashirr Lukmahn, ( College of Engineering and Applied Science ), Emma Bonerb ( Leeds School of Business ), Byron Patten ( Leeds School of Business ).

FoodWise wants to boost the food industry’s sustainability and profitability with a software platform that helps restaurants predict food demand in real time using weather, past sales and other external factors in order to minimize waste and maximize profitability. Bonerb said FoodWise is targeting 276,000 full-service restaurants and that dozens have already expressed interest in the concept that could save them at least $1,300 monthly.

The FoodWise team discovered that the U.S. restaurant industry produces 22 to 33 billion tons of food waste annually, which translates into 170 million tons of greenhouse gas emissions. “Something that a lot of people may not realize is the magnitude of the environmental impact that food waste has on our planet,” said Bonerb. “Our team hopes to use our platform to help restaurants better understand the impact of their food waste both financially and environmentally…we also want to empower restaurants to reduce their costs in any way they can so their business can succeed.”

$30,000 Second Place Prize: Refr Sports

Additionally: $14,000 ‘14 Founders Award’ and $1,000 Audience Choice Award

Huck Sorock ( College of Media, Communications and Information , '23)

Refr Sports brings a spark of technology to transform the referee industry by providing an easy, universal way for sports organizations, referees and referee assignors to get what they need.

Sorock founded the company as a junior at CU Boulder. By then, he’d had plenty of experience playing hockey and refereeing high school games in Minnesota, his home state. “[I] realized there were tons of problems with the industry… and I was blown away by how archaic the existing systems in the market were,” he said. 

Sorock wants to “bring the referee business out of the dark ages,” to where most contractor-based industries already have shifted. “I set out on this journey trying to solve a problem that I had experienced firsthand. Officials are an often overlooked aspect of sports, and my end goal is to Gigify or Uber-fy the industry… It’s a great way to make money, be active and stay involved in the sports you love.”

$10,000 Third Place Prize: PricingService.ai

Team: Dan Zhang ( Leeds School of Business ), David Li (City University of Hong Kong), Matt Schwartz (Sage Hospitality)

Using an AI-powered, dynamic pricing subscription service, PricingService.ai is building the world’s most advanced revenue management service for increasing revenue in the hotel industry. 

Zhang and Schwartz met while walking their kids to school and realized they shared a desire to update pricing dynamics in the multi-billion dollar hotel industry with a fully autonomous service that responds in real-time to multiple market dynamics. “Because the price should be right,” they said. 

$5,000 Fourth Place Prize: BioSensor Solutions

Team:  Carl Kalin and David Beitz ( Venture Partners at CU Boulder ) 

BioSensor Solutions provides a low-cost, biodegradable, 2D-printed sensor that measures microbial activity in the soil. Data directly from sensors in the field–invented by Gregory Whiting ( Mechanical Engineering ) and Madhur Atreya ( Mechanical Engineering )—provide real-time insights into soil health.

The sensors could shift how growers track, measure and respond to soil health, ideally helping farmers conserve resources and increase yields. The technology could help address global greenhouse gas emissions and the need to feed an additional one billion people by 2050. “Both of us were looking for something to really make a difference,” said Beitz. 

BioSensor Solutions is part of the first cohort of the Embark Deep Tech Startup Creator  launched by Venture Partners at CU Boulder in 2023.

$5,000 Fifth Place: AFFIX 

Team:  Jamie Saunders ( Leeds School of Business ), Benjamin Asser ( Law School ), Daniel Collins ( Leeds School of Business ) 

AFFIX wants to change the way we invest in real estate. Powered by prefabrication and a creative approach to zoning code, the venture is pioneering a new type of real estate investment designed for desirable vacation destinations.

Saunders’ started on the path to founding AFFIX when helping her sister with the fraught process of trying to buy her first home in a hot real estate market. “She and I researched every ownership option we could think of, then I dove into the zoning code to pinpoint precisely where the roadblocks for these different options lie,” said Saunders. “Owning a home is one of the cornerstones of the American dream, and we want to create more paths into this sort of investment.”

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Purpose-Driven Leadership: Navigating Redemptive Entrepreneurship and Impact-Driven Business Purpose & Profit Podcast

Today's episode is about redemptive entrepreneurship and creating impact-driven businesses and nonprofits. Join Dave and Carly as they welcome guest Dan Reed, a partner at Praxis Capital. Praxis is a venture-building ecosystem with a redemptive imagination, supporting founders, funders, and innovators motivated by faith to address the major issues of our time. Dan is inspired by the potential of generous, forward-thinking capital to catalyze cultural transformation.  The group discusses the concept of redemptive entrepreneurship and ventures, exploring the importance of leadership qualities and ethical extremes within nonprofits and the business realm. Redemptive entrepreneurship emerges as a beacon of hope as the philanthropic world has been suffering in the last couple of years. Dan goes into the discernment between market and redemptive opportunities in entrepreneurship. Topics covered: The importance of invaluable qualities of redemptive leadership in both nonprofit and business contexts The power of the redemptive entrepreneurship method that aims to mend a broken system Creative problem-solving and ethical business practices How imagination-driven collaboration between nonprofit, business, and funder leaders can address social issues. Looking at how corporations can take responsibility for social and economic issues and the impact they have had. (EX. Patagonia)  We hope you enjoy our conversation with Dan Reed! Season Four of the Purpose & Profit Podcast is brought to you by: IMAGO CONSULTING Imago Consulting is an advisory firm that helps nonprofits and businesses grow through innovation. Innovation is the lifeblood of any growing organization. Imago publishes a weekly trends report called The Wave Report – learn more at www.imago.consulting and subscribe at www.imago.consulting/wavereport. VIRTUOUS Virtuous is a software company committed to helping nonprofits grow generosity. Virtuous believes that generosity has the power to create profound change in the world and in the heart of the giver. With that in mind, it’s their mission to move the needle on global generosity by helping nonprofits better connect with and inspire their givers. Learn more about Virtuous at www.virtuous.org and download your free Nonprofit CRM Checklist at www.virtuous.org/checklist.  MASTERWORKS At Masterworks, their mission is to help you accomplish yours. They are a full-service agency for Christian organizations. Their emphasis on both mission & mastery makes us leading experts in moving hearts & minds to act. Masterworks has over 30 years of experience serving organizations through strategy, direct mail, digital, analysis, creative, & technology. Learn more about Masterworks at www.masterworks.agency. Special thanks to editor and sound engineer Barry R. Hill and producer Jenna Owens.

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4.2 Creativity, Innovation, and Invention: How They Differ

Learning objectives.

By the end of this section, you will be able to:

• Distinguish between creativity, innovation, and invention
• Explain the difference between pioneering and incremental innovation, and which processes are best suited to each

One of the key requirements for entrepreneurial success is your ability to develop and offer something unique to the marketplace. Over time, entrepreneurship has become associated with creativity , the ability to develop something original, particularly an idea or a representation of an idea. Innovation requires creativity, but innovation is more specifically the application of creativity. Innovation is the manifestation of creativity into a usable product or service. In the entrepreneurial context, innovation is any new idea, process, or product, or a change to an existing product or process that adds value to that existing product or service.

How is an invention different from an innovation? All inventions contain innovations, but not every innovation rises to the level of a unique invention. For our purposes, an invention is a truly novel product, service, or process. It will be based on previous ideas and products, but it is such a leap that it is not considered an addition to or a variant of an existing product but something unique. Table 4.2 highlights the differences between these three concepts.

One way we can consider these three concepts is to relate them to design thinking. Design thinking is a method to focus the design and development decisions of a product on the needs of the customer, typically involving an empathy-driven process to define complex problems and create solutions that address those problems. Complexity is key to design thinking. Straightforward problems that can be solved with enough money and force do not require much design thinking. Creative design thinking and planning are about finding new solutions for problems with several tricky variables in play. Designing products for human beings, who are complex and sometimes unpredictable, requires design thinking.

Airbnb has become a widely used service all over the world. That has not always been the case, however. In 2009, the company was near failure. The founders were struggling to find a reason for the lack of interest in their properties until they realized that their listings needed professional, high-quality photographs rather than simple cell-phone photos. Using a design thinking approach, the founders traveled to the properties with a rented camera to take some new photographs. As a result of this experiment, weekly revenue doubled. This approach could not be sustainable in the long term, but it generated the outcome the founders needed to better understand the problem. This creative approach to solving a complex problem proved to be a major turning point for the company. 7

People who are adept at design thinking are creative, innovative, and inventive as they strive to tackle different types of problems. Consider Divya Nag , a millennial biotech and medical device innovation leader, who launched a business after she discovered a creative way to prolong the life of human cells in Petri dishes. Nag’s stem-cell research background and her entrepreneurial experience with her medical investment firm made her a popular choice when Apple hired her to run two programs dedicated to developing health-related apps, a position she reached before turning twenty-four years old. 8

Creativity, innovation, inventiveness, and entrepreneurship can be tightly linked. It is possible for one person to model all these traits to some degree. Additionally, you can develop your creativity skills, sense of innovation, and inventiveness in a variety of ways. In this section, we’ll discuss each of the key terms and how they relate to the entrepreneurial spirit.

Entrepreneurial creativity and artistic creativity are not so different. You can find inspiration in your favorite books, songs, and paintings, and you also can take inspiration from existing products and services. You can find creative inspiration in nature, in conversations with other creative minds, and through formal ideation exercises, for example, brainstorming. Ideation is the purposeful process of opening up your mind to new trains of thought that branch out in all directions from a stated purpose or problem. Brainstorming , the generation of ideas in an environment free of judgment or dissension with the goal of creating solutions, is just one of dozens of methods for coming up with new ideas. 9

You can benefit from setting aside time for ideation. Reserving time to let your mind roam freely as you think about an issue or problem from multiple directions is a necessary component of the process. Ideation takes time and a deliberate effort to move beyond your habitual thought patterns. If you consciously set aside time for creativity, you will broaden your mental horizons and allow yourself to change and grow. 10

Entrepreneurs work with two types of thinking. Linear thinking —sometimes called vertical thinking —involves a logical, step-by-step process. In contrast, creative thinking is more often lateral thinking , free and open thinking in which established patterns of logical thought are purposefully ignored or even challenged. You can ignore logic; anything becomes possible. Linear thinking is crucial in turning your idea into a business. Lateral thinking will allow you to use your creativity to solve problems that arise. Figure 4.5 summarizes linear and lateral thinking.

It is certainly possible for you to be an entrepreneur and focus on linear thinking. Many viable business ventures flow logically and directly from existing products and services. However, for various reasons, creativity and lateral thinking are emphasized in many contemporary contexts in the study of entrepreneurship. Some reasons for this are increased global competition, the speed of technological change, and the complexity of trade and communication systems. 11 These factors help explain not just why creativity is emphasized in entrepreneurial circles but also why creativity should be emphasized. Product developers of the twenty-first century are expected to do more than simply push products and innovations a step further down a planned path. Newer generations of entrepreneurs are expected to be path breakers in new products, services, and processes.

Examples of creativity are all around us. They come in the forms of fine art and writing, or in graffiti and viral videos, or in new products, services, ideas, and processes. In practice, creativity is incredibly broad. It is all around us whenever or wherever people strive to solve a problem, large or small, practical or impractical.

We previously defined innovation as a change that adds value to an existing product or service. According to the management thinker and author Peter Drucker , the key point about innovation is that it is a response to both changes within markets and changes from outside markets. For Drucker, classical entrepreneurship psychology highlights the purposeful nature of innovation. 12 Business firms and other organizations can plan to innovate by applying either lateral or linear thinking methods, or both. In other words, not all innovation is purely creative. If a firm wishes to innovate a current product, what will likely matter more to that firm is the success of the innovation rather than the level of creativity involved. Drucker summarized the sources of innovation into seven categories, as outlined in Table 4.3 . Firms and individuals can innovate by seeking out and developing changes within markets or by focusing on and cultivating creativity. Firms and individuals should be on the lookout for opportunities to innovate. 13

One innovation that demonstrates several of Drucker’s sources is the use of cashier kiosks in fast-food restaurants. McDonald’s was one of the first to launch these self-serve kiosks. Historically, the company has focused on operational efficiencies (doing more/better with less). In response to changes in the market, changes in demographics, and process need, McDonald’s incorporated self-serve cashier stations into their stores. These kiosks address the need of younger generations to interact more with technology and gives customers faster service in most cases. 15

Another leading expert on innovation, Tony Ulwick , focuses on understanding how the customer will judge or evaluate the quality and value of the product. The product development process should be based on the metrics that customers use to judge products, so that innovation can address those metrics and develop the best product for meeting customers’ needs when it hits the market. This process is very similar to Drucker’s contention that innovation comes as a response to changes within and outside of the market. Ulwick insists that focusing on the customer should begin early in the development process. 16

Disruptive innovation is a process that significantly affects the market by making a product or service more affordable and/or accessible, so that it will be available to a much larger audience. Clay Christensen of Harvard University coined this term in the 1990s to emphasize the process nature of innovation. For Christensen, the innovative component is not the actual product or service, but the process that makes that product more available to a larger population of users. He has since published a good deal on the topic of disruptive innovation, focusing on small players in a market. Christensen theorizes that a disruptive innovation from a smaller company can threaten an existing larger business by offering the market new and improved solutions. The smaller company causes the disruption when it captures some of the market share from the larger organization. 17 , 18 One example of a disruptive innovation is Uber and its impact on the taxicab industry. Uber’s innovative service, which targets customers who might otherwise take a cab, has shaped the industry as whole by offering an alternative that some deem superior to the typical cab ride.

One key to innovation within a given market space is to look for pain points, particularly in existing products that fail to work as well as users expect them to. A pain point is a problem that people have with a product or service that might be addressed by creating a modified version that solves the problem more efficiently. 19 For example, you might be interested in whether a local retail store carries a specific item without actually going there to check. Most retailers now have a feature on their websites that allows you to determine whether the product (and often how many units) is available at a specific store. This eliminates the need to go to the location only to find that they are out of your favorite product. Once a pain point is identified in a firm’s own product or in a competitor’s product, the firm can bring creativity to bear in finding and testing solutions that sidestep or eliminate the pain, making the innovation marketable. This is one example of an incremental innovation , an innovation that modifies an existing product or service. 20

In contrast, a pioneering innovation is one based on a new technology, a new advancement in the field, and/or an advancement in a related field that leads to the development of a new product. 21 Firms offering similar products and services can undertake pioneering innovations, but pioneering the new product requires opening up new market space and taking major risks.

Entrepreneur In Action

Pioneering innovation in the personal care industry.

In his ninth-grade biology class, Benjamin Stern came up with an idea to change the personal care industry. He envisioned personal cleaning products (soap, shampoo, etc.) that would contain no harsh chemicals or sulfates, and would also produce no plastic waste from empty bottles. He developed Nohbo Drops , single-use personal cleansing products with water-soluble packaging. Stern was able to borrow money from family and friends, and use some of his college fund to hire a chemist to develop the product. He then appeared on Shark Tank with his innovation in 2016 and secured the backing of investor Mark Cuban . Stern assembled a research team to perfect the product and obtained a patent ( Figure 4.6 ). The products are now available via the company website.

Is a pioneering innovation an invention? A firm makes a pioneering innovation when it creates a product or service arising from what it has done before. Pokémon GO is a great example of pioneering innovation. Nintendo was struggling to keep pace with other gaming-related companies. The company, in keeping with its core business of video games, came up with a new direction for the gaming industry. Pokémon GO is known worldwide and is one of the most successful mobile games launched. 22 It takes creativity to explore a new direction, but not every pioneering innovation creates a distinctly new product or capability for consumers and clients.

Entrepreneurs in the process of developing an innovation usually examine the current products and services their firm offers, investigate new technologies and techniques being introduced in the marketplace or in related marketplaces, watch research and development in universities and in other companies, and pursue new developments that are likely to fit one of two conditions: an innovation that likely fits an existing market better than other products or services being offered; or an innovation that fits a market that so far has been underserved.

An example of an incremental innovation is the trash receptacle you find at fast-food restaurants. For many years, trash cans in fast-food locations were placed in boxes behind swinging doors. The trash cans did one job well: They hid the garbage from sight. But they created other problems: Often, the swinging doors would get ketchup and other waste on them, surely a pain point. Newer trash receptacles in fast-food restaurants have open fronts or open tops that enable people to dispose of their trash more neatly. The downside for restaurants is that users can see and possibly smell the food waste, but if the restaurants change the trash bags frequently, as is a good practice anyway, this innovation works relatively well. You might not think twice about this everyday example of an innovation when you eat at a fast-food restaurant, but even small improvements can matter a lot, particularly if the market they serve is vast.

An invention is a leap in capability beyond innovation. Some inventions combine several innovations into something new. Invention certainly requires creativity, but it goes beyond coming up with new ideas, combinations of thought, or variations on a theme. Inventors build. Developing something users and customers view as an invention could be important to some entrepreneurs, because when a new product or service is viewed as unique, it can create new markets. True inventiveness is often recognized in the marketplace, and it can help build a valuable reputation and help establish market position if the company can build a future-oriented corporate narrative around the invention. 23

Besides establishing a new market position, a true invention can have a social and cultural impact. At the social level, a new invention can influence the ways institutions work. For example, the invention of desktop computing put accounting and word processing into the hands of nearly every office worker. The ripple effects spread to the school systems that educate and train the corporate workforce. Not long after the spread of desktop computing, workers were expected to draft reports, run financial projections, and make appealing presentations. Specializations or aspects of specialized jobs—such as typist, bookkeeper, corporate copywriter—became necessary for almost everyone headed for corporate work. Colleges and eventually high schools saw software training as essential for students of almost all skill levels. These additional capabilities added profitability and efficiencies, but they also have increased job requirements for the average professional.

Some of the most successful inventions contain a mix of familiarity and innovation that is difficult to achieve. With this mix, the rate of adoption can be accelerated because of the familiarity with the concept or certain aspects of the product or service. As an example, the “videophone” was a concept that began to be explored as early as the late 1800s. AT&T began extensive work on videophones during the 1920s. However, the invention was not adopted because of a lack of familiarity with the idea of seeing someone on a screen and communicating back and forth. Other factors included societal norms, size of the machine, and cost. It wasn’t until the early 2000s that the invention started to take hold in the marketplace. 24 The concept of a black box is that activities are performed in a somewhat mysterious and ambiguous manner, with a serendipitous set of actions connecting that result in a surprisingly beneficial manner. An example is Febreeze, a chemical combination that binds molecules to eliminate odors. From a black box perspective, the chemical engineers did not intend to create this product, but as they were working on creating another product, someone noticed that the product they were working on removed odors, thus inadvertently creating a successful new product marketed as Febreeze.

What Can You Do?

Did henry ford invent the assembly line.

Very few products or procedures are actually brand-new ideas. Most new products are alterations or new applications of existing products, with some type of twist in design, function, portability, or use. Henry Ford is usually credited with inventing the moving assembly line Figure 4.7 (a) in 1913. However, some 800 years before Henry Ford, wooden ships were mass produced in the northern Italian city of Venice in a system that anticipated the modern assembly line.

Various components (ropes, sails, and so on) were prefabricated in different parts of the Venetian Arsenal, a huge, complex construction site along one of Venice’s canals. The parts were then delivered to specific assembly points Figure 4.7 (b) . After each stage of construction, the ships were floated down the canal to the next assembly area, where the next sets of workers and parts were waiting. Moving the ships down the waterway and assembling them in stages increased speed and efficiency to the point that long before the Industrial Revolution, the Arsenal could produce one fully functional and completely equipped ship per day . The system was so successful that it was used from the thirteenth century to about 1800.

Henry Ford did not invent anything new—he only applied the 800-year-old process of building wooden ships by hand along a moving waterway to making metal cars by hand on a moving conveyor ( Figure 4.7 ).

Opportunities to bring new products and processes to market are in front of us every day. The key is having the ability to recognize them and implement them. Likewise, the people you need to help you be successful may be right in front of you on a regular basis. The key is having the ability to recognize who they are and making connections to them. Just as those ships and cars moved down an assembly line until they were ready to be put into service, start thinking about moving down the “who I know” line so that you will eventually have a successful business in place.

The process of invention is difficult to codify because not all inventions or inventors follow the same path. Often the path can take multiple directions, involve many people besides the inventor, and encompass many restarts. Inventors and their teams develop their own processes along with their own products, and the field in which an inventor works will greatly influence the modes and pace of invention. Elon Musk is famous for founding four different billion-dollar companies. The development processes for PayPal , Solar City , SpaceX , and Tesla differed widely; however, Musk does outline a six-step decision-making process ( Figure 4.8 ):

• Ask a question.
• Gather as much evidence as possible about it.
• Develop axioms based on the evidence and try to assign a probability of truth to each one.
• Draw a conclusion in order to determine: Are these axioms correct, are they relevant, do they necessarily lead to this conclusion, and with what probability?
• Attempt to disprove the conclusion. Seek refutation from others to further help break your conclusion.
• If nobody can invalidate your conclusion, then you’re probably right, but you’re not certainly right.

In other words, the constant underlying Musk’s decision process is the scientific method. 25 The scientific method , most often associated with the natural sciences, outlines the process of discovering an answer to a question or a problem. “The scientific method is a logical organization of steps that scientists use to make deductions about the world around us.” 26 The steps in the scientific method line up quite nicely with Musk’s decision-making process. Applying the scientific method to invention and innovation makes sense. The scientific method involves becoming aware of a problem, collecting data about it by observing and experimenting, and coming up with suggestions on how to solve it.

Economists argue that processes of invention can be explained by economic forces. But this hasn’t always been the case. Prior to 1940, economic theory focused very little on inventions. After World War II, much of the global economy in the developed world needed to be rebuilt. New technologies were developing rapidly, and research and development investment increased. Inventors and economists alike became aware of consumer demand and realized that demand can influence which inventions take off at a given time. 27 However, inventors are always up against an adoption curve. 28

The Rogers Adoption Curve was popularized through the research and publications of the author and scientist Everett Rogers . 29 He first used it to describe how agricultural innovations diffused (or failed to) in a society. It was later applied to all inventions and innovations. This curve illustrates diffusion of an innovation and when certain people will adopt it. First is the question of who adopts inventions and innovations in society: The main groups are innovators, early adopters, early and late-majority adopters, and “laggards” (Rogers’s own term). 30 The innovators are the ones willing to take a risk on a new product, the consumers who want to try it first. The early adopters are consumers who will adopt new inventions with little to no information. Majority adopters will adopt products after being accepted by the majority. And finally, laggards are often not willing to readily adopt change and are the hardest to convince to try a new invention. 31

Rogers’s second way of looking at the concept is from the point of view of the invention itself. A given population partially or completely adopts an invention or rejects it. If an invention is targeted at the wrong population or the wrong population segment, this can dramatically inhibit its chances of being adopted widely. The most critical point of adoption often occurs at the end of the early adoption phase, before the early majority steps in and truly confirms (or not) the diffusion of an invention. This is called the diffusion chasm (though this process is usually called the diffusion of innovations , for our purposes, it applies quite well to new inventions as we define them here).

The diffusion curve depicts a social process in which the value of an invention is perceived (or not) to be worth the cost ( Figure 4.9 ). Early adopters generally pay more than those who wait, but if the invention gives them a perceived practical, social, or cultural advantage, members of the population, the popularity of the invention itself, and marketing can all drive the invention over the diffusion chasm. Once the early majority adopts an innovation (in very large numbers), we can expect the rest of the majority to adopt it. By the time the late majority and the laggards adopt an innovation, the novelty has worn off, but the practical benefits of the innovation can still be felt.

Inventors are constantly trying to cross the diffusion chasm, often with many products at a time. Crossing the diffusion chasm is a nearly constant concern for business-focused or outcomes-focused inventors. Inventors put many of their resources into an invention during the innovation and early adoption stages. Inventions may not turn a profit for investors or the inventors themselves until they are well into the early majority stage of adoption. Some inventors are pleased to work toward general discovery, but most in today’s social and cultural context are working to develop products and services for markets.

One shortcoming of the diffusion of innovations model is that it treats inventions and innovations as though they are finished and complete, though many are not. Not all inventions are finished products ready for market. Iterative development is more common, particularly in fields with high levels of complexity and in service-oriented ventures. In the iterative development process, inventors and innovators continuously engage with potential customers in order to develop their products and their consumer bases at the same time. This model of business learning, also known as the science of customer development, is essential. 32 Business learning involves testing product-market fit and making changes to an innovation or invention many times over until either investment funding runs out or the product succeeds. Perhaps the most accurate way to summarize this process is to note that many inventions are hit-or-miss prospects that get only a few chances to cross the diffusion chasm. When innovators follow the build-measure-learn model (discussed in detail in Launch for Growth to Success ), they try to work their way across the diffusion chasm rather than making a leap of faith.

Work It Out

The safety razor was an innovation over the straight razor. Safety razor blades are small enough to fit inside a capsule, and the location and type of handle was altered to suit the new orientation of handle to blade ( Figure 4.10 ). Most contemporary razors are themselves innovations on the safety razor, whether they have two, three, four, or more blades. The method of changing razor blades has evolved with each innovation on the safety razor, but the designs are functionally similar.

The electric razor is a related invention. It still uses blades to shave hair off the face or body, but the blades are hidden beneath a foil or foils. Hairs poke through the foils when the razor is pressed against the skin, and blades moving in various directions cut the hairs. Although electric razors use blades as do mechanical razors, the new design and the added technology qualified the electric razor as an invention that offered something new in the shaving industry when Jacob Schick won the patent for a shaving machine in 1930. 33 Still other innovations in the shaving genre include gender-specific razors, beard trimmers, and, more recently, online clubs such as Dollar Shave Club and Harry’s Shave Club .

Think about the conceptual difference between innovation and invention. Is the safety razor a pioneering innovation or an incremental one? What makes the electric razor an invention, as we define it here? What makes it stand out as a leap from previous types of razors? Do you think the electric razor is a “sure thing”? Why or why not? Consider the availability of electricity at the time the first electric razors were being made. Why do you think the electric razor made it over the diffusion chasm between early adopters and early majority adopters? Do you think the electric razor was invented iteratively with small changes to the same product in response to customer preferences? Or did it develop in a series of black box inventions, with each one either diffusing or not?

• 7 “How Design Thinking Transformed Airbnb from Failing Startup to Billion Dollar Business.” First Round Review . n.d. https://firstround.com/review/How-design-thinking-transformed-Airbnb-from-failing-startup-to-billion-dollar-business/
• 8 “Divya Nag, 26.” Fortune . n.d. http://fortune.com/40-under-40/2017/divya-nag-27/
• 9 Rikke Dam and Teo Siang. “Introduction to the Essential Ideation Techniques Which Are the Heart of Design Thinking.” Interaction Design Foundation . April 2019. https://www.interaction-design.org/literature/article/introduction-to-the-essential-ideation-techniques-which-are-the-heart-of-design-thinking
• 10 Dawn Kelly and Terry L. Amburgey. “Organizational Inertia and Momentum: A Dynamic Model of Strategic Change.” Academy of Management Journal 34, no. 3 (1991): 591–612.
• 11 Ian Fillis and Ruth Rentschler. “The Role of Creativity in Entrepreneurship.”  Journal of Enterprising Culture  18, no. 1 (2010): 49–81.
• 12 P. F. Drucker. Innovation and Entrepreneurship: Practices and Principles . New York: Harper & Row Publishers, 1986.
• 13 P. F. Drucker. Innovation and Entrepreneurship: Practices and Principles . (New York: Harper & Row Publishers, 1986), 35.
• 14 P. F. Drucker. Innovation and Entrepreneurship: Practices and Principles . New York: Harper & Row Publishers, 1986.
• 15 Blake Morgan. “5 Fresh Examples of Customer Service Innovation.” Forbes . July 17, 2017. https://www.forbes.com/sites/blakemorgan/2017/07/17/5-fresh-examples-of-customer-experience-innovation/#3ae5a46e5c18
• 16 Tony Ulwick. “Reinventing Innovation for 25 Years.” Strategyn . n.d. https://strategyn.com/tony-ulwick/?network=g&matchtype=p&keyword=tony%20ulwick&creative=268244402567&device=c&devicemodel=&placement=&position=1t1&campaignid=1394486829&adgroupid=57939305027&loc_physical_ms=9015694&loc_interest_ms=&gclid=CjwKCAjw29vsBRAuEiwA9s-0B2jD3BYbm-BEiPWHKfd6R6mnW4XCHuhXbX_JhUof76IdXh6joIzlWRoCqJAQAvD_BwE
• 17 Chris Larson. “Disruptive Innovation Theory: What It Is & 4 Key Concepts.” Harvard Business School . November 15, 2016. https://online.hbs.edu/blog/post/4-keys-to-understanding-clayton-christensens-theory-of-disruptive-innovation
• 18 Rosamond Hutt. “What Is Disruptive Innovation?” World Economic Forum . June 25, 2016. https://www.weforum.org/agenda/2016/06/what-is-disruptive-innovation/
• 19 Lloyd Waldo. “What’s a Pain Point? A Guide for Startups.” StartupYard Seed Accelerator . December 1, 2016. https://startupyard.com/whats-pain-point/
• 20 Abdul Ali, Manohar U. Kalwani, and Dan Kovenock. “Selecting Product Development Projects: Pioneering versus Incremental Innovation Strategies.”  Management Science  39, no. 3 (1993): 255–274.
• 21 Abdul Ali. “Pioneering versus Incremental Innovation: Review and Research Propositions.”  Journal of Product Innovation Management  11, no. 1 (1994): 46–61.
• 22 JV Chamary. “Why ‘Pokémon GO’ Is the World’s Most Important Game.” Forbes . February 10, 2018. https://www.forbes.com/sites/jvchamary/2018/02/10/pokemon-go-science-health-benefits/#2b6f07fd3ab0
• 23 Morten Thanning Vendelø. “Narrating Corporate Reputation: Becoming Legitimate through Storytelling.”  International Studies of Management & Organization  28, no. 3 (1998): 120–137.
• 24 Thomas J. Fitzgerald. “For the Deaf: Communication without the Wait.” The New York Times . December 18, 2003. https://www.nytimes.com/2003/12/18/technology/for-the-deaf-communication-without-the-wait.html
• 25 Abby Jackson. “Elon Musk Uses This 6-Step Process to Make Decisions.” Business Insider . November 16, 2017. https://www.inc.com/business-insider/how-elon-musk-makes-decisions-rolling-stone.html
• 26 Joan Whetzel. “Formula for Using the Scientific Method.” Owlcation . February 11, 2017. https://owlcation.com/academia/FormulaForUsingScientificMethod
• 27 N. Rosenberg. “Science, Invention and Economic Growth.”  The Economic Journal  84, no. 333 (1974): 90–108.
• 28 Everett M. Rogers.  Diffusion of Innovations , 5th ed. New York: Simon and Schuster, 2010.
• 29 John-Pierre Maeli. “The Rogers Adoption Curve & How You Spread New Ideas Throughout Culture.” The Political Informer . May 6, 2016. https://medium.com/the-political-informer/the-rogers-adoption-curve-how-you-spread-new-ideas-throughout-culture-d848462fcd24
• 30 Everett M. Rogers.  Diffusion of Innovations , 5th ed. New York: Simon and Schuster, 2010.
• 31 Wayne W. LaMorte. “Diffusion of Innovation Theory.” September 9, 2019. http://sphweb.bumc.bu.edu/otlt/MPH-Modules/SB/BehavioralChangeTheories/BehavioralChangeTheories4.html
• 32 Eric Ries. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses . Largo, Maryland: Crown Books, 2011.
• 33 “Jacob Schick Invents the Electric Razor.” Connecticut History . May 13, 2017. https://connecticuthistory.org/jacob-schick-invents-the-electric-razor/

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• Publication date: Jan 16, 2020
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Nurturing Entrepreneurs: The Role of Parenting Styles in Fostering Business Innovation

A harsh truth that many refuse to accept is that the future belongs to entrepreneurs who are creative, bold, and resilient people who aren't just ready to deal with tomorrow's challenges head on but are eager to invent the future themselves. But where do these entrepreneurial traits come from? Can they be nurtured at a young age? Do parents have a role to play in fostering an innovative mindset among their children?

The Psychology of Entrepreneurship

Entrepreneurs are, at their very best, problem solvers. Most of them see challenges as catalysts for growth, failures as lessons, and gaps in the market as opportunities. Psychology offers interesting insights into these unique individuals and their worldviews.

The Big Five personality traits are a widely accepted framework often used in assessing personality psychology. Andreas Rauch and Michael Frese conducted research aiming to understand the relationship between business owners' personality traits, business creation, and success while relying on the Big Five personality model. It was established that entrepreneurs often score high on conscientiousness, extraversion, and openness to experience while displaying lower levels of neuroticism. These traits reflect a disciplined work ethic, an outgoing personality, an adventurous spirit, and resilience to stress, respectively.

While classic psychology theories are informative, they do not entirely capture the essence of entrepreneurship. Thus, I propose a fresh perspective: the "Entrepreneurial Trait Formation Model." This framework posits that entrepreneurs also possess a blend of emotional intelligence, curiosity, and adaptive optimism. Curiosity drives innovation, adaptive optimism helps entrepreneurs persist in the face of adversity, and emotional intelligence enables effective leadership. Through this new lens, we can gain a deeper understanding of the psychological makeup of entrepreneurs.

Parenting Styles and Their Impacts

Renowned developmental psychologist Diana Baumrind's pioneering work on parenting styles identified three integral types: authoritative, authoritarian, and permissive. Her work and subsequent studies have shown that authoritative parents tend to show warmth, clear guidelines, and support — aspects that ensure a child becomes more confident, responsible, and capable. Authoritarian parents show low warmth and impose strict rules on their children, both of which can lead a child to be obedient but often with low self-esteem and social incompetence. Permissive parenting is denoted by high warmth but few guidelines and rules — a style that can make children struggle with being responsible and having self-control.

In the context of nurturing entrepreneurs, a compelling question arises: do these parenting styles relate to the development of entrepreneurial traits ?

Wendy Grolnick and Richard Ryan say yes, basing their assertion on research findings from a study they did to ascertain how parent styles correlate with a child's competence and self-regulation. They went ahead to suggest that children raised by authoritative parents might be more likely to develop traits like resilience, conscientiousness, and emotional intelligence, fostering an entrepreneurial mindset.

Based upon all these, I propose a novel idea of "entrepreneurial mindset parenting," a style aiming to nurture independence, curiosity, adaptability, and risk-taking, key ingredients in the entrepreneurial spirit.

The Intersection of Parenting Styles and Entrepreneurship

While instrumental in shaping general child behavior, traditional parenting styles might not sufficiently cultivate the distinct traits needed for entrepreneurial success. This is where the concept of "entrepreneurial mindset parenting" steps in, effectively bridging the gap between entrepreneurial traits and parenting.

The "Entrepreneurial Trait Formation Model" provides a blueprint for this parenting approach. Consider curiosity the cornerstone of motivation for any entrepreneur. A parent who resorts to encouraging their child's inquisitiveness, allowing them to experiment, explore, and even fail, helps develop a lifelong love for innovation and learning. Similarly, fostering adaptive optimism and emotional intelligence involves teaching children about empathy, encouraging them to manage and understand their emotions, and instilling a resilient outlook that perceives challenges as opportunities.

Parenting practices that align with this model could include allowing autonomy, providing constructive feedback, promoting problem-solving skills, and teaching the value of perseverance among children. In essence, "entrepreneurial mindset parenting" intersects a practical, intentional parenting approach with the psychological building blocks of entrepreneurship.

Business Innovation and Entrepreneurship

As pointed out in the disruptive innovation theory conceptualized by Clayton Christensen, entrepreneurs are encouraged to break away from the status quo and create unique value in the market. Linking this ideology back to the "Entrepreneurial Trait Formation Model" and "entrepreneurial mindset parenting," it is clear that the seeds of such groundbreaking business strategies can be sown early in life.

For example, a child whose curiosity is fostered and constantly encouraged to question established norms might be enough to develop a trait of disruptive innovation within them. Similarly, encouraging children to understand different perspectives raised by their peers and how to empathize with the feelings or experiences of others can lead to unique value propositions in the business world, what I call "empathetic innovation." Seemingly, there is a unique correlation between such early exposure to innovative thinking and the likelihood of entrepreneurial behavior in adulthood.

Practical Advice for Nurturing Entrepreneurs

Any parent can foster an entrepreneurial spirit in their children by implementing these strategies:

1. Nurture emotional intelligence: Teach them about self-awareness and empathy. Use everyday situations as teaching moments to discuss perspectives and emotions.

2. Encourage curiosity: Allow your child to ask questions, and most importantly, learn from failure.

3. Cultivate creativity: Provide your child with opportunities for innovative thinking. Encourage them to find unique solutions to challenges and to question established norms.

4. Promote adaptive optimism: Show your child that problems are opportunities in disguise. Encourage a growth mindset while emphasizing the power of adaptability and persistence.

As we pivot into a world where adaptability and creativity are paramount, let's not just raise children; let's cultivate innovators and foster a culture of entrepreneurship. The mind of a child is not a vessel to be merely filled, but a flame to be kindled. You can embolden their spirit, fuel their curiosity, and unleash their potential. After all, today's young dreamers are tomorrow's industry disruptors, and every home can incubate the next big idea.

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