Creative Thinking A103IAE

Simon Hill

AIM

• To understand the various ways of evaluating an idea

• Why is it so important to understand feasibility?

• What steps need to be taken?

Learning Outcomes

• Conduct SWOT and PEST analyses for their business ideas;

• Conduct competitor and customer analyses for their business ideas;

• Select appropriate methods of market research for their business;

What we are going to look at...What we are going to look at...

• SWOT and PEST analysis

• Customers and competitors

• Market research

• Idea evaluation – does it work?

A hoodie for an iPod

A good or a bad idea?

DISCUSSIONDISCUSSION

DISCUSSIONDISCUSSION

Innocent market research

A good or a bad idea?

Method of organising information…

Strengths

Threats

Weaknesses

Opportunities

Internal to the company

External to the company

SWOT AND PEST ANALYSISSWOT AND PEST ANALYSIS

Where are we now? Internal information

• Strengths– Knowledge, Skills, Talents– Motivation– Ideas (Intellectual Property?)– Cash

• Weaknesses – Shortage of…….any of the above

SWOT AND PEST ANALYSISSWOT AND PEST ANALYSIS

Political Factors• Taxation policy, Employment laws, Environmental

protection legislation, Trade restrictions and tariffs, Pressure groups

• Which of these effect your idea?

Economic Factors• Unemployment levels, Economic growth, interest

rates, exchange rates, inflation rate, Money Supply

• Which of these effect your idea?

SWOT AND PEST ANALYSISSWOT AND PEST ANALYSIS

Social Factors• Lifestyles, Health consciousness, Population

growth rate, Education Levels, Age distribution, Consumerism

• Which of these effect your idea?

Technological Factors• R&D activity, automation, technology incentives,

technological change

• Which of these effect your idea?

SWOT AND PEST ANALYSISSWOT AND PEST ANALYSIS

Strengths

Knowledge, Skills, Talents,

Threats

(PEST)

Weaknesses

Lack of..Knowledge, Skills, Talents?

Opportunities

(PEST)

SWOT AND PEST ANALYSISSWOT AND PEST ANALYSIS

Customer Analysis What do we need to know?

• Who is the customer?• What do they buy? How much do they pay?• Why do they buy it?• Who is involved in the purchasing decision?• When do they buy it?• Where do they buy it?

CUSTOMERS AND COMPETITORSCUSTOMERS AND COMPETITORS

• Strategy?• Objectives?• Success to date?• Strengths and Weaknesses?• What will they do in the future?

Competitor Analysis What do we need to know?

CUSTOMERS AND COMPETITORSCUSTOMERS AND COMPETITORS

Competitor Analysis Where do we want to be?

• What is it?– Understanding of your competitive

advantage/disadvantage relative to your competitors

– Knowledge of your competitors strategies – past, present and future

• What is it used for?– Future strategic decisions– Developing an advantage over your competitors

CUSTOMERS AND COMPETITORSCUSTOMERS AND COMPETITORS

• Primary Data– Example: The cups in the bins

• Secondary Data– Example: Number of kids in school with

phones

MARKET RESEARCHMARKET RESEARCH

• Primary Data– Used if secondary data is insufficient;– Data collected for a specific purpose;– Market research to fill in knowledge gaps about

a particular aspect of the market;– Advantage - data is up to date and relevant to

the task in hand;– Expensive and time consuming to collect.

MARKET RESEARCHMARKET RESEARCH

• Secondary Data– What do we already know?– Feedback from sales staff– Internet– Industry publications– Databases– Observation– Advantage - low cost and readily available– May not be sufficient for information needs

MARKET RESEARCHMARKET RESEARCH

Source: Leeds Met Business Start-Up

• Does it work and will it keep working?• Can you do it by yourself or will you need help?• Will sufficient people buy it?• Do you know what the competition is?• Is it better than the competition?• Do you know what prices you can charge?• Can you sell it at a price worthwhile to you?• Do you know what benefits you are providing?

CHECKING IF IDEA WORKS 1CHECKING IF IDEA WORKS 1

Source: Leeds Met Business Start-Up

• Have you tested your idea in the market?• Is it safe?• Is it legal?• Can you hire or buy skills or equipment you

don’t have?• Do you know your cash needs for starting up?• Can you try it out on a part-time basis at first?• Do other people think it’s worthwhile?• Is location important?

CHECKING IF IDEA WORKS 2CHECKING IF IDEA WORKS 2

ANY QUESTIONS?

SUMMARYSUMMARY

THANK YOU!