Opportunity Discovery – Linking to Venture Ideas (5 of 5)

October 4, 2011 § Leave a comment

Updating the Composition of Channels of a Consideration Set and Linking to Venture Ideas Found in Related Channels

During the Session 4 exercise, you were provided a chart where you identified up to six areas of prior knowledge, prioritized those areas, and listed several relevant information channels for each area of prior knowledge. Using those charts, you have since then searched specific information channels (e.g., places, people, events, etc.) for ideas and recorded notes on your chart relating to your experiences. This searching and note taking may have linked you to the discovery of a new venture idea.

You should continue to update your relevant information channels because as you continue your search for new venture ideas, it is likely your search will lead to links to new information channels. As you alter and/or add information channels, it will help you to focus your search more efficiently and link to your new venture ideas.

Recording Promising New Venture Ideas in Your Journal

From now on, you will concentrate on making entries of promising new venture ideas in your journal. These entries will result from consulting information channels linked to your areas of prior knowledge.

If possible, you should strive to make one entry of a new venture idea in your journal daily. If you miss a day or two, don’t become discouraged but resume making entries as soon as possible.

A journal entry of a new venture idea will include all the following:

1. The date of the entry.

2. The sequential idea number.

3. A description of your venture idea.

4. A title to your venture idea.

5. Why you thing this idea is worth considering.

6. What you were thinking or doing when this idea occurred to you

7. Identify the extent to which specific knowledge influenced your discovery.

8. Identify from what information channel your idea came.

9. Identify the strategy (course of action) you used to tap the information channel employed.

Date: Idea#:

Describe your idea:

What would you name your idea?

Why do you think your idea is worth considering for a business?

What were you thinking when this idea occurred to you?

Please rate how the following sources of specialized knowledge have influenced your discovery of this idea:

Not at all Very little To some extent Quite a bit A great deal

Occupation

On-the-job Routines

Job-related Technologies

Specialized Education

Social Relations/Network

Hobbies

From what information channel did your idea come?

What strategy did you employ to tap the information channel you used?

Opportunity Discovery – Updating Channels of a Consideration Set (4 of 5)

October 3, 2011 § Leave a comment

Updating the Composition of Channels of a Consideration Set

This exercise may assist you to inventory areas of prior knowledge where you have a comparative advantage compared with most other people. You will list three or more information channels for each area of knowledge that may provide cues about discoveries in each area.

Think about a discovery as information about an idea for creating new wealth that would place potential competitors at a cost disadvantage if they were to attempt to imitate it.

Steps:

1. You have listed six areas of prior knowledge. Now, prioritize these areas (1-6) according to your view of their potential value if you could make a discovery in each area. Worksheets will be distributed in class.

2. Based on your considered view of the potential of each area to be a promising source of ideas about discoveries, select three or more information channels that you want to intensively search this week.

  • Your selection of information channels may be limited to a single area of knowledge or it may be a combination of channels representing multiple areas.
  •  Develop a sequence for searching these channels for this week.

3. Make brief notes on your experiences while searching the channels.

4. Record a brief description of any discoveries. We are interested in both the quantity of discoveries and the potential of your discoveries to create new wealth.

Opportunity Discovery – Consideration Sets (3 of 5)

October 2, 2011 § Leave a comment

The reason entrepreneurs notice different things is that each of them brings to every situation a unique understanding of the world, based on their prior knowledge. Thus, discovery depends on a fit between an entrepreneur’s idiosyncratic prior knowledge and a particular venture idea, which may be discovered based on systematic search.

Information can come to entrepreneurs in the form of signals. A signal is information that changes our understanding about a future state. Due to market inefficiencies, some sources of information may be less costly to access, as well as more frequent. Thus, an information channel is a comparatively low-cost source of frequent signals, some of which are noise and of little value.

An example of an information channel for a real estate developer could be a reality office that represents sellers of diverse properties. The noise factor could relate to a few, uninformed, self-interested agents in the office whose primary interest was earning a commission. From information channels, entrepreneurs actually assess a set of signals with some probability distribution, not just a particular signal.

This approach is based on the use of consideration sets. A consideration set is a group of information channels that emit signals that may indicate a potential discovery. Entrepreneurs can select channels in their consideration set using prior knowledge. They can also update the composition of their consideration set as their searching continues and as they scan the environment.

Please refer to Figure 1 distributed in class

It would not be prudent for entrepreneurs to search outside their consideration sets where they presuppose that venture ideas complementing their competencies can be found. Moreover, a consideration set is a dynamic, ongoing reflection of an entrepreneur’s prior knowledge and newly received signals. If an entrepreneur were to discover an outside venture idea, it is highly unlikely that he or she would possess the requisite competencies to discover or exploit its value, which suggests that individual entrepreneurs possess different types of competencies. In addition, ideas are not valuable until they are exploited and exploitation itself depends on an entrepreneur acquiring the requisite knowledge-based competencies and resources, which may lead to the creation of new wealth.

I. To test the effectiveness of a consideration set based approach, you must do several things:

1. Develop a way to categorize and act on your prior knowledge. You should
try to identify about six categories. There are three ways that you can do this:

  • You can identify your own categories of experience that you think provide you with a very informed view of a particular activity or set of activities.
  • You can use your list of Achievements as indicators of categories where you think you have a unique understanding of a particular activity or set of activities.
  • You can use your Accomplishments Matrix to point to categories where you may have special understanding of a specific activity of set of activities.

2. Select information channels to search based on your prior knowledge.

3. Determine an order for searching these channels, which depends on their search costs and prospects for discovering an idea in each of them.

4. Update the composition of your consideration set in response to what you learn while searching.

5. Make brief, daily written comments on your search activities, which will collectively become a journal record of what you have accomplished.

II. In Column A below, please list six categories of prior knowledge where you consider yourself an expert or very accomplished.

III. In Column B below, please state your choice of the best sources of information about future signals regarding venture ideas related to the category in Column A. The choices in Column B become your information channels and, collectively, your first consideration set for searching.

IV. In Column C below, prioritize the order that you will use this week to search each information channel identified in Column B. Please do not check information sources outside your consideration set.

A                            B                             C

1.

2.

3.

4.

5.

6.

V. Finally, make brief daily notes of your search activities.

It is important that you complete this exercise before proceeding.

Opportunity Discovery – Charting Personal Accomplishments to Assess Prior Knowledge (2 of 5)

October 1, 2011 § Leave a comment

This exercise can help you better understand factors that possibly contributed to your success with previous accomplishments. Having this understanding may help you formulate strategies in the future or make discoveries of valuable venture ideas.

Copies of the Accomplishments Matrix will be provided in class.

Instructions for the Accomplishments Matrix:

1. In the row headings on the left of the matrix, please write a brief description or label to remind you about a particular accomplishment. Please write something for each accomplishment.

2. For each accomplishment, ask yourself, “What was it about myself that contributed to my success with this particular accomplishment?” Write the answer to this question in a separate column heading for each talent or type of prior knowledge that applies. Examples of possible answers to this question are the following:

  • a. Intelligence
  • b. Perseverance
  • c. Creativity
  • d. People skills
  • e. Problem solving ability
  • f. Conceptual skills
  • g. Physical prowess
  • h. Good looks and charm
  • i. Technical knowledge
  • j. Education
  • k. Networking skills

3. You may add to the above list if it does not capture the factors that contributed to your success.

4. Now, for each accomplishment, place a check mark in the box indicating that a particular type of talent or type of prior knowledge individually contributed to the success of each accomplishment. After you examine knowledge that contributed to a particular accomplishment, you will have created a checkered matrix with some squares checked off and others left empty.

5. For each accomplishment, ask yourself of those factors that I have indicated with a check mark, which of them most greatly influenced my success with this particular accomplishment. Circle that factor. When you have completed this step, you will have one circled check mark for each accomplishment.

Interpretation:

The circled check marks indicate those factors that you have relied on in the past and may wish to rely on in the future as you strive to accomplish your objectives.

It is important that you complete this exercise before proceeding

Opportunity Discovery – Personal Accomplishments (1 of 5)

September 30, 2011 § Leave a comment

Developing Information About Your Personal Accomplishments

For the purposes of this assignment, please complete the following:

1. List 10 to 15 of your most significant personal accomplishments. Think about an accomplishment as something that you personally did. Furthermore, it should be something that meets the following criteria:

  • Something that you are proud to have accomplished
  • Something that you enjoyed doing
  • Something that you think that you did very well

2. No one else needs to share your views of the significance of these accomplishments.

3. We are primarily interested in accomplishments that are related to your work or education. However, as long as each of them satisfies the three criteria listed under point one above, you may list anything – even hobbies or sports.

4. Please provide enough information to indicate your approximate age at the time of the accomplishment, as well as enough information to provide a picture of what it was you accomplished and why it was important to you. If you were to type the accomplishment in a double-spaced format, you could probably fit 3 or 4 on a page.

5. After you have listed the accomplishments, please prioritize them from one to fifteen, depending on their significance to you, numbering the most significant one as number one.

6. It is important you complete this exercise before proceeding

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