Slide 1
King Saud University -- Kent State University
Partners in Entrepreneurship
Class 7

Slide 2
Understand the concepts of individual and team creativity and innovation in entrepreneurship
07_Objectives
Understand the concepts of individual and team creativity. and innovation in entrepreneurship

Slide 3
Discuss creativity, invention, and innovation via the presentation.
Review suggested small business questions handout.
07_Interactivities
Discuss creativity, invention, and innovation via the presentation.
Review suggested small business questions handout.

Slide 4
07-1 Success Factors to Innovation
07-2 Suggested Small Business Interview
Questions
These handouts should be in your
Instructor's Guide and on the Class web site, if they are not, please ask the Course
Coordinator about them.
07_Handouts
07-1 Success Factors to Innovation
07-2 Suggested Small Business Interview Questions
These handouts should be in your Instructor's Guide and on the Class web site, if they are not, please ask the Course Coordinator about them.

Slide 5
• 1. The ability to transcend traditional ideas, rules, patterns, relationships, or the like, and to create meaningful new ideas, forms, methods, interpretations, etc.
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Creativity definition 1: The ability to transcend traditional ideas, rules, patterns, relationships, or the like, and to create meaningful new ideas, forms, methods, interpretations, etc.
Main point: The reason creativity is important to entrepreneurship is because this factor is critical to success in identifying the business or market opportunity upon which the entrepreneur will develop the idea and the concept for successfully launching the business.
Key points to discuss:
1. Individual creativity should be looked at as an ‘ability” that can be taught. Much has been written on the subject of creative thinking. This is often tied into the subject of brain dominance and how individuals think, and is very useful when used in conjunction with teams focused on creative problem solving and generating new opportunity and new product ideas.
This often learned ability goes beyond the types of training and development activities experienced by individuals during their professional development, such as when financial analysts are given training in recognizing tell tale patterns; or when engineers are give training in structural failure indicators.

2. Creativity training emphasizes tools and techniques which help individuals to “think
outside the box” and not impose artificial constraints of what is feasible.
3. Creative thinking results in a state of mind within the individual that leads to ideas and concepts with commercial applications. The end result of creativity is finding new ways of meeting the market place needs, wants, and expectations of customers, while making a profit.

Slide 6
• 2. Originality, progressiveness, or imagination:
• Examples: the need for creativity in modern industry; creativity in the performing arts.
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Definition 2: Originality, progressiveness, or imagination is another way of defining creativity.
This definition focuses on a business-oriented perspective of the need for creativity in today’s industry; or as another example, creativity in the performing arts field.
Key points to discuss:
1. Originality and imagination are terms frequently referred to in such fields as science, technology, art, and music. This is much too limiting. Creativity is a state-of-mind that applies
to many problem-solving situations in a wide variety of fields and disciplines.
2. The term ‘progressiveness’ entails the idea of a continuity of change from evolutionary to revolutionary. Creativity can be incremental in nature or evolutionary in its results, as well as being revolutionary or radical in how it can bring about a change.
When talking about the concept of continuity of creativity, it is often useful to think of a line segment with the ends being content on one end and process on the other. These first 2 definitions of creativity are content-focused.
Creativity is focusing on the “what” factors; it is equally important to consider the “how” or process factors in how we define creativity.

Slide 7
• 3.the process by which each person uses their creative ability:
• Example: Extensive reading stimulated his creativity.
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Creativity definition 3: Creativity is the process by which each person uses his/her own creative ability in a given situation to achieve a desired result. The word process entails a sequence of actions, steps, or activities that are necessary to help achieve this desired result.
In the creative process, there are definite actions, steps, and activities that can be taught, learned, and used. For example, extensive reading is one readily apparent way of stimulating one’s creativity. And reading is an activity that is very often used in learning how to be more creative.
There are many tools and techniques that are available to help stimulate individual creative thinking; for example, brain dominance. A pioneer in this field is Ned Hermann who has written extensively about the fact that the 4 quadrants of the human brain control the tendencies of a person to think with distinct biases.
• Some individuals think in structured, disciplined ways which is linear thinking.
• Others are dreamers and work in more unstructured ways which is lateral thinking.
When assembling a creative problem solving team or a creative new product concept team, it is an excellent idea to assemble a team to have a mix of brain dominance profiles, in order to maximize the likelihood of` synergistic thinking, ideas and solutions resulting.
Comments: The instructor can talk about specific examples of creativity methods and techniques, e.g., workshops on applied creative thinking; tools such as Creative Whack Pack; and idea generation techniques. Only if the instructor understands the theory and application of brain dominance techniques, should he or she discuss in greater detail how it can be applied to teams.

Slide 8
According to U.S. Patent
Law:
• A new, useful process, machine, improvement
• product of some unique intuition or genius
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According to U.S. Patent Law: An invention is a new, useful process, machine, improvement, etc., that did not exist previously and that is recognized as the product of some unique intuition or genius, as distinguished from ordinary mechanical skill or craftsmanship.
We’ve been talking about individual creativity for the last few slides. And you’ve heard me talk about the ‘results’ of creative thinking. In a business or a company, especially one that has a research & development (R&D) department with engineers, scientists, technical specialists, and so on, there is the need for not only having individual creativity in action, but having creative synergies that occur because of people working together, in teams or in groups, so that new ideas can be patented. This is what invention is all about.
In a new venture business, there may not be dedicated departments of technologists that perform R&D. There may only be 1 or 2 people who are your technical specialists. But you can combine these types of resources with other company specialists in functions such as sales, marketing, manufacturing, accounting, and so on, so that this multi- disciplinary business team can be used to generate innovative solutions to business problems.
There is a distinct difference between invention and innovation.

Slide 9
• Adopting, altering or adjusting that which already exists
• Innovation means turning creativity into bottom line results
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Innovation definition: Adopting, altering or adjusting that which already exists
Innovation means turning creativity into bottom line results.
Key point: The difference between invention and innovation is that invention deals with “new to the world” ideas and concepts that may or may not result in commercial successes. In large companies with research & development departments, there will be more activity involving invention and patenting simply because this is what engineers and scientists do in order to solve problems for the company. Many times, their ideas will be unique and will require protection under patenting laws.
In small and medium sized businesses, and especially in entrepreneurial ventures, identifying the market opportunity very often is the result of innovative and creative thinking by nontechnical, business people. This will often not require patenting activities.
However, there are other business laws that help to conserve and protect a company’s legal right to possess necessary protection that gives the company a competitive advantage. Some examples are logos, registered trademarks, and copyright. All of these measures collectively are
known as intellectual property. This property has value and is accounted for on the company’s balance sheet, under the term goodwill and/or intangible assets.

Slide 10
• Schumpeter defines innovation as a process of Creative Destruction:
• the quest for profits pushes to innovate constantly…
• by breaking old rules to establish new ones.
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The economist Schumpeter (1934) defines innovation as a process of creative destruction, where the quest for profits pushes to innovate constantly, by breaking old rules to establish new ones.
Joseph Schumpeter believed that entrepreneurs created value “by exploiting an invention, or more generally, an untried technological possibility for producing a new commodity or producing an old one in a new way, by opening up a new source of supply of materials or a new outlet for products, by reorganizing an industry….”
Schumpeter’s definition describes the five basic ways that entrepreneurs find opportunities to create new businesses:
• Use a new technology to produce a new product
• Use an existing technology to produce a new product
• Use an existing technology to produce an old product in a new way
• Find a new source of resources (that might allow the entrepreneur to produce a product more cheaply)
• Develop a new market for an existing product
Note: It would be helpful to use a 4-box model to illustrate the above thinking
How do entrepreneurs create innovative business ideas? How do they recognize market opportunities?
• They listen (for unmet needs, for problems experienced, etc) in order to get ideas about improving a business or creating a new one.
• They observe the customer, the market, the environment, etc, to get ideas about how to solve problems, identify customer needs, help society, etc
• They think about possible ways to solve the problem, meet the customer need, or take a financial advantage of the opportunity that’s identified.

Slide 11
• This implies:
• new products
• new combinations
• new processes
• new markets, or
• new organizational forms.
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Innovation implies: the introduction of new products; the successful commercialization of new combinations of materials and components; the introduction of new processes; the opening of new markets or, the introduction of new organizational forms.
Key points to emphasize:
1. Innovation relies on creativity being applied to the product, the process, the technology, and/or the market, which when successfully applied will result in the “new” thinking in the areas shown here.
2. Entrepreneurs are innovators who can see opportunities in the marketplace because they can identify unmet or unfulfilled needs.
As author Steve Mariotti and many others say, “an entrepreneur recognizes opportunities where other people see only problems.”
Examples: Henry Ford and the need for a way to give people greater mobility; Steve Jobs and the need for a way to make using a PC easy; Michael Dell and the need for a way to give people cheaper, customized PC; or Mohammed Yunnis and the need to give Bangladeshis access to capital to start their own businesses.

Slide 12
• Handout
• Discussion
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Handout the exercise and discuss in class:
There are 7 success factors to innovation:
• Culture must embrace innovation and risk-taking — everywhere!
• Innovation must be aligned with mission and goals
• Who is the beneficiary of this innovation?
• Accept risk and a climate where mistakes are OK
• Emphasize exploratory thinking, idea generation, and experimentation.
• Solid interpersonal relationships and teamwork — support!
• Cross-functional collaboration and communication — use all of your varied resources!
Additionally, for Entrepreneurs, there also are seven questions that they must answer to help them to be successful:
• Are there better alternatives to starting a business?
• Where do you want the business to go in the short-term?
• Where do you want the business to go in the long-term?
• What is the best way to get there?
• Have you assembled all the knowledge, equipment and advisors this task requires?
• When will you arrive?
• Who is responsible for getting you there?

Slide 13
The homework is:
Follow the instructions on handout
07-2_H_Interview_Questions

Slide 14
Success Factors to Innovation
Culture must embrace innovation and risk taking – everywhere.
Innovation must be aligned with mission and goals.
Who is the beneficiary of this innovation? Always tie into resident benefits.
Accept risk and a climate where mistakes are acceptable.
Emphasize exploratory thinking, idea generation, and experimentation.
Solid interpersonal relationships and teamwork – support!
Cross-functional collaboration and communication – use all of your varied resources!
07-1_Handout
Success Factors to Innovation:
Culture must embrace innovation and risk taking – everywhere.
Innovation must be aligned with mission and goals.
Who is the beneficiary of this innovation? Always tie into resident benefits.
Accept risk and a climate where mistakes are acceptable.
Emphasize exploratory thinking, idea generation, and experimentation.
Solid interpersonal relationships and teamwork – support!
Cross-functional collaboration and communication – use all of your varied resources!

Slide 15
Instructions: your team will need to find a small business owner to interview. The purpose is to understand the types of issues faced by Entrepreneurs. You can use the questions given below, and any others that you can think of, to help you in the interview.
07-2_Handout Small Business Interview
Refer to Word file handout # 07-2_ Interview

Slide 16
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The instructor should ask: “What other questions or comments do you have regarding the class material or assignments?”
Alternately, “Questions and comments can be written and given to he instructor, or slid under the office door. Be sure the instructor’s name is on the paper, so that it gets to the correct person.”