ENTREPRENEURAL OPPORTUNITIES QUESTION AND ANSWERS

QUESTION ONE

• Distinguish between “Utility patents” and Design patents”

A design patent protects the ornamental design; configuration, improved decorative appearance, or shape of an invention. This patent is appropriate when the basic product already exists in the marketplace and is not being improved upon in function, but only in style.

A utility patent protects, any/pew invention or functional improvements on existing inventions. This can be to a product, machine, a process, or even composition of matter

• Discuss four strategies that an entrepreneur might use to minimize patent risks.

• Conducting a rigorous prior patent search before filing a patent
• Obtain a license to use another invention.
• It is also important to review all known competitor products for any patent notices.
• If you have reason to believe that a competitor has a patent on a related product but cannot find the patent via a patent search or the competitor’s product, you may want to consider contacting the competitor to see if they have a ’patent.

QUESTION TWO

Outline four limitations of focus group discussions

• Focus groups tend to become influenced by one or two dominant people in the session thus making the output very biased

The moderator plays an essential role in handling the situation, but if the moderator is not experienced enough, it is very easy for the whole discussion to be dominated by a few people.

• Focus groups are not as effective in dealing with sensitive topics

It is-difficult to have the participants share their real feelings towards some sensitive topics publicly: This can in turn influence the output data.

• Focus group output is not projectable       

If a great deal of consistency in the results from a series of focus groups have been identified and it is very likely that the results from these sessions probably can represent a larger ‘.number of people. We can’t expect focus groups to be projectable-‘in the same way as .quantitative study findings can be

Furthermore, traditional focus groups can only be held in a few cities, unlike some internet and. telephone focus groups which, could be organized in various situations without limitation of time and location. This also makes data from focus groups less representative of the total universe.

• Focus groups are a very artificial environment which can influence the responses that are generated

This is frequently the argument that ethnographers will use when recommending their methodology versus .focus groups. Because researchers using the ethnographic technique will situate themselves in the real environment .Eat is unreachable for focus groups. In focus groups people are collected in a meeting from room thus they might behave differently from how they behave when they are not watched and it will affect the quality of research results.

 

• Lack of honesty from participants

One drawback to a focus group is that participants do not always voice their true opinions. Some individuals are shy by nature and do not readily address large groups or strangers.- Participants can also be swayed by the focus group moderator or the presence of company ; executives. This can especially hold true of a moderator who expresses her own opinions or shows bias during.-the session.

 

• Time and monetary casts.

The cost of a focus group are high..This’ includes the cost of facility rentals, supplies, hiring a market research firm and paying participants for their time. In addition, assessing the results of the focus group to create a .report or presentation can be a time-consuming task. If analysis is not done correctly, it may lead to costly marketing or production mistakes by a company

 

• Participant domination       

Focus groups dominated by one or two participants can skew data and may cause, others to hesitate in sharing their insight. While a good moderator will be able to quell dominating personalities and make quieter voices heard, it can still influence the raw data collected and potentially lead to false negatives.

 

• Logistical challenges

Transportation issues may arise if the focus group location is in a remote area. If the location is not accessible by public transportation, companies should select either an alternative location or provide transportation for participants. Not placing the focus group in an accessible area may limit the participant pool. In. addition, if a company is looking to launch a’ product nationally, it should .consider conducting several focus groups throughout the country to examine regional habits and interests. This endeavor, however, can be quite costly and. time-consuming.

QUESTION THREE

• In relation to entrepreneurship, explain the following terms:

 

• Window of opportunity

A window of opportunity is a short time period during which an otherwise unattainable opportunity exists. After the window of opportunity closes, the opportunity ceases to exist. Since good deals on real estate, business offers, etc. do not exist forever, the window of opportunity is the ideal time to act.

• Forced associations

Forced Association is a powerful creative technique in which a series of random words are forced info association with the topic under investigation. These artificially paired words are then considered for creative possibilities.

• Civic entrepreneurship

Civil entrepreneurship is the recognition of a social problem and the uses of entrepreneurial principles to organize create and manage a social venture to achieve a desired social change. While a business entrepreneur typically measures performance in profit and return, a social entrepreneur also measures positive returns to society. Thus, the main aim of social entrepreneurship is to further broaden social, cultural, and environmental goals. Social entrepreneurs are commonly associated with the voluntary and not-for-profit sectors, but this need not preclude making a profit.

 

• Suggest eight ways of creating an environment suitable for the nourishing of creativity in an enterprise

 

• Promote regular team brainstorming sessions, which allow employees a chance produce a high quantity of ideas. Once you have a large amount of ideas, analyze and choose those ideas that are of high quality
• Create an encouraging work environment. If employees see that their ideas are encouraged and accepted, they will be more likely to be creative leading to potential innovation in the workplace.
• Create a collaborative work environment. Creativity and innovation can stem from employees working together to reach-a goal. Foster communication between employees and between departments and reward those that work together to solve problems.
• Encourage, your team members to take risks. The opposite of creativity is fear. Employees won’t be creative or innovative if they fear a backlash from failure. Create an environment that is free from fear of failure; treat your employees’ failures as a learning tool, rather than a means for passing around blame.
• Be willing to stretch the rule book. Leaders who promote creativity among their people don’t disregard guidelines and policies, but they inherently know when they need to be challenged, and they can see when a more flexible approach should be taken. David Kelley, founder of Ideo Product Development said, the most important thing I have learned from big companies is that creativity gets stifled when everyone’s got to follow the rules.
• Stress the importance of creativity. Ensure all your staff knows that you want to hear their ideas. Unless they understand how innovating your business processes can keep your firm competitive, your efforts at encouraging creative thinking risk falling flat.
• Make time for brainstorming. Allocate time for new ideas to emerge. For example set aside a slot at the end of meetings for brainstorming, hold regular group works and arrange team days out. You should also give individuals the space to reflect. Privately on their work if you think they need it
• Actively-solicit ideas. Place suggestion boxes around the workplace, appeal for ne1 ideas to solve particular problems and, quite literally, keep your door open to new ideas
• Train staff in innovation Techniques. Your staff may be able to bounce an idea around, but be unfamiliar with the .skills involved in creative problem-solving. You may find training sessions in formal techniques such as brainstorming, lateral thinking and mind-mapping worthwhile.
• Cross-fertilise. Broadening people’s experiences can be a great way to spark ideas Short-term job swaps and shadowing in-house can introduce d fresh perspective to roles. Encourage people to look at how other businesses do things, even those in other sectors, and consider, how they can be adapted or improved,
• Challenge the way staff work. Encourage employees to keep looking anew at the way they approach- their work’; Ask people whether they have considered alternative ways of working and what might be achieved by doing things differently.
• Be supportive. Respond enthusiastically to all ideas and never make someone. Offering an idea, however hopeless, feel foolish. Give even the most apparently outlandish of ideas a. chance to be aired.
• Tolerate mistakes. A certain [amount of risk-taking is inevitable with creative thinking. Allow people to learn from their mistakes. Never put off the creative flow by penalizing those’ whose ideas don’t work out.
• Reward creativity. Motivate individuals or teams who come up with winning ideas by actively recognizing creativity, for example through an awards scheme. You could even demonstrate your recognition that not all ideas work out by rewarding those who just have a rich flow of suggestions, regardless of whether they are put into action at work.
• Act on ideas. Creative thinking is only worthwhile if it results in action. Provide the time and resources to develop and implement those ideas worth acting upon. Failure to do so not only means your firm will fail to benefit from, innovation,, but flow of ideas may well dry-up if staff feel the process is pointless.

 

• The following equation could be used in the analysis of the global entrepreneurship.

 

 

 

Required:

 

Match each factor listed below to its corresponding parameter.

 

• Property rights – Political and legal environment  
• Bribes and corruption – Culture
• Emerging new customer lifestyles – Change
• Solicitation of suggestions – Communication
• Product safety and liability – Economy
• Geographical size and density – Distribution channels

 

QUESTION FOUR

 

• Explain the term “nascent entrepreneur”      A nascent entrepreneur is a person who invents a new firm independently: The person commits time and resources to funding the new firm, whereby he passes through the stages of conception, gestation, infancy and adolescence.

He mobilizes1 resources, coordinates, direct and manage all factors of production for quick return on the solely invested venture.

• Highlight six features of a good business name

• Unique within its industry
• Legally available and defensible
• Good alliteration, especially if a longer name
• Does not lend itself to abbreviations
• Flexible and expandable
• Linguistically clean
• Will not age quickly
• Embraces company personality
• Fits within company’s brand portfolio

 

• Citing relevant examples, describe six types of business incubators who nurture young entrepreneurs

Mixed portfolio business incubators -This target high growth firms in a range of sectors and exists in environments with little entrepreneurial activities.

 

–      Technology business incubators-Targets high growth technology firms.lt requires strong technology and human capital infrastructure.

 

–      Business incubators with university relationships-Academic institutions have a role as a founder and is a source of resources such as research, expertise, space and or funds.

 

–      Agri-business incubators-Uses entrepreneurship and innovation as a mechanism for social impact. This focuses on socially valuable products and services.

 

Incubators may also fall into two general categories

–      Technology – focusing on commercialzing of new technology and technology transfer.

–      Mixed use – servicing a wide range of clients.

QUESTION FIVE

 

• Entrepreneurial success depends on opportunity recognition.

 

Outline six ways which an entrepreneur can use to identify a business opportunity.

• Making an honest evaluation of one’s self and abilities

Here the entrepreneur will assess his areas of interests and make a decision as to what exactly he would want to do with his talents. What drives him to go into business is something he will want to examine more keenly and make the first decision.

• Running the business enthusiastically

If the entrepreneur is introducing something new into the market that is unknown to the general public he should muster all his efforts to enthusiastically convince his potential customers of the need for the product service he is bringing into the market.

• Having a complete knowledge of the product or service

The entrepreneur should carry out a thorough research into the product or service he wishes to introduce. This will enable him convince his customers and potential .investors.

• Making a market evaluation of the product or service to be offered

The entrepreneur should find out whether the time is right to introduce the product to the public. He should consider whether there is a need for this type of item, and what is its potential in relation to competition.

• Checking the training and experience required to run the business properly

If running a particular line requires training, the entrepreneur should consider attending a course that will enable him have relevant skills required for the business he has chosen.

• Financial strength and strong credit behind the business opportunity

Where the entrepreneur is running the business under a parent company, he should find out whether the licensor-seller will provide an escrow agreement to deliver a building, equipment, leasehold improvements, inventory etc.

• Visit the headquarters of the licensor-seller

Tine entrepreneur should talk to the personnel and the training director of the parent company. He should visit the original prototype of the business being sold and evaluate other outlets.

• Discuss four factors that are critical in the success of a partnership in entrepreneurship.

 



Institutional Partners That Link to the Goal

The partners should be goal oriented such that they combine their efforts to ensure that the firm’s goals have been achieved.

Evolving Structure and Partners

The partnership structure and membership should also evolve with time as this is a sign of growth However, to create change within a partnership, flexibility must be exercised—effective partnerships require the trust and confidence that will allow partners to come and go as needed.

Leadership in Key Positions

The partners should also have leadership qualities so as to steer the company in the right direction.

Inclusive Decision making

The partners should work as a team to make critical decisions. The partners very quickly become disenfranchised, disengaged, and uninterested if they feel the same individuals are always making all of the decisions. For example, based on their history, community-based organizations tend to feel distrust in partnerships with educational institutions; while they are at the table, they do not feel like equal partners. Ensuring that the partnership stresses communication and decision making on equal footing is extremely important.

Appropriate Governance Structure

A partnerships governance structure also matters. The governance structure of any partnership must be examined to determine whether it functions effectively for the purpose at hand.

Mutually Beneficial Interactions

Partnerships, especially those with diverse partners, should feature mutually beneficial relationships. Partners should interact in ways that benefit individuals and their organizations, as well as contribute to the partnerships overall goal

QUESTION SIX

 

• Argue the case for and against the following business succession strategies

 

• Early entry strategy

• The first entrant gains early recognition.
• He is also able to establish reputation in the market place.
• The existing product also benefits from consumer traits as it will gain a stable preference pattern.
• The pioneer is able to occupy proffered market position.
• The production costs are also lower than those for later entrants.

• Delayed entry strategy

Disadvantages of early entry strategy

• The first entrant bears most of the costs and risks of developing the product
• Bears the risk of developing the market of the product.
• He must also absorb the risk that imitators may copy the innovation in a short time and with fewer costs

 

. Advantages of delay entry strategy

• Do not have to beear costs and risks of developing the product.
• They enter an already developed market.

 

 

. Disadvantages of delay entry strategy

• Later entrants require rapid technological evolution for production of their products.
• They require heavy marketing investments to gain a jump on competition against earlier entrants.

• Describe six factors to consider when developing an effective business succession strategy

• The nature and size of the business.
• The financial plans of the business.
• The business risk model and strategies.
• The marketing and research of the products of the enterprise.
• The legal requirements in respect to the growth and stability of the business.
• The possible competition of the market and other forms of franchising business available.
• The cost of succession of the business.

QUESTION SEVEN

• Describe the registration process followed by an entrepreneur in order to be granted patent rights over a business idea or product.

Procedure for Patent Registration

The first step in securing a patent is the filing of a patent application with KIPI. – (Kenya industrial property institute)

 

The patent application generally contains:

 

• The request (Form IP 3)
• The specification containing the following:

 

• The title of the invention, as well as an indication of its technical field;
• The background and a description of the invention, in clear language and enough detail that an individual .with an average understanding of the field’ could use or reproduce the invention.
• Visual materials, if any, such as drawings, plans or diagrams to better describe the invention.
• “Claims”, that is, information which determines the extent of protection sought by the patent.
• “Abstract”, it includes the title of the invention; and a summary of the disclosure included in the description. It indicates the technical field to which the invention relates and the principal use(s) of the invention. It merely serves the purpose of technical information.

 

Publication of Application

The application for grant of a patent is published in the KIPI Journal as soon as possible after the expiration of eighteen months from the filing date.

 

Substantive Examination

Where an application for a patent satisfies the formal requirements, the applicant is notified and is required to submit, within three years from the filing date of the application, a request for the examination of the application.

 

An examination of the application is carried out to check out whether the invention in respect of which the application is made is patentable.

 





Grant of Patent

Unless an application is rejected, a patent is granted and issued to the applicant together with a certificate of grant of a patent. Every patent granted is registered, and is, as soon as reasonably practicable, published in the Industrial Property Journal.

 

Costs

The official fee for registering a patent where the claims are not more than 10 is approximately Kshs. 15,000 or USD 750 for local and foreign applicants respectively.

 

One has to factor additional cost, that is, patent annuity fees which is for maintaining a patent. The fee is first due 12 months from the date of filing the patent application and thereafter after every 12 months until its expiry on the 20th year.

The first annuity fee is Kshs. 2,000/- Total applicant) or USD 300 (foreign applicant) and increases every year up to Kshs. 50,000 (local applicant) or USD 2,500 (foreign applicant) on the 20th year.

The owner may obtain court orders to stop such activities, as well as seek damages for loss of financial rewards and recognition.

• Explain the essential guideline for successful networking in business

 

• Keep in mind that networking is about being genuine and authentic, building trust and relationships, and seeing how you can help others.
• Define your goals before participating in networking meetings so that you’ll pick groups that will help you get what you’re trying to achieve. Some network meetings are done for the purpose of learning, making contacts, and/or volunteering rather than on strictly making business connections.
• Interact with as many groups as possible. Try to find groups that cater to your interests so you won’t have to work so hard to participate. Observe the tone and attitude of the group. Do the members sound supportive of one another? Does the leadership appear competent?
• Hold volunteer positions in organizations. This is a great way to stay visible and give back;to groups that have helped you.
• Ask open-ended questions in networking conversations. This means questions that allow the responder to communicate and express himself more as opposed to those that can .be answered by a simple yes or no. This form of questioning opens up the discussions and shows listeners that you are interested in them.
• Become known as a powerful resource for others. Being known as a powerful resource makes you attractive to different people within the network. They’ll most likely try to remember and turn to you for suggestions, ideas and additional contacts.
• Have a clear understanding of what you do and why, for whom, and what makes your doing it special or different from other people doing the exact same thing. In order to get referrals, you must first have a clear understanding of what you do that you can easily articulate to others.
• Be able to articulate what you are looking for and how others may help you. Too often people in conversations ask, “How may I help you?” and no immediate answer comes to mind.
• Follow through quickly and efficiently on referrals you are given. When people give you referrals, your actions reflect on them. Respect and honour that and your referrals will grow.
• Call those you meet who may benefit from what you do and vice versa. Express that you enjoyed meeting them, and ask if you could get together and share ideas.

QUESTION EIGHT

 

• Define the term “Business induction”

Business incubators are programs designed to accelerate the successful companies through an array of business support resources and services, developed and orchestrated by incubator management

• Explain seven types of business incubators that promote the efficiency of entrepreneurship

 

Mixed portfolio business incubators-This targets high growth firms in a range of sectors and exists environments with little entrepreneurial activities.

 

–           Technology business incubators-Targets high growth technology firms.lt requires strc^0 technology and human capital infrastructure.

–           Business incubators with university relationships-Academic institutions have a role as a founder and is a source of resources such as research, expertise, space and or funds.

–           Agri-business incubators Uses entrepreneurship and innovation as a mechanism for social impact. This focuses on socially valuable products and services.

 

Incubators may also fall into two general categories

 

–      Technology – focusing on commercialzing of new technology and technology transfer.

–           Mixed use – servicing a wide range of clients.

• Highlight four factors that a business incubator should take into account when deciding which business to incubate

• Is it a True Incubator?—some office building owners falsely advertise themselves as incubators in order to lure tenants. Entrepreneurs need to study the details of each offer to determine whether such claims are legitimate.
• Length of Operation—”Incubators take time,” some may go beyond their stipulated periods.
• Incubator Leadership—many analysts contend that entrepreneurs can learn a great deal about the fundamental quality of an incubator program simply by studying the program’s leadership. Is the incubator managed by people with backgrounds in business, or by general college or agency administrators? Can the managers provide long-term business plans that show how they intend to guide the incubator to financial independence?
• Location—does the incubators’ setting adequately address your fledgling company’s needs in terms of target market, transportation, competition, and future growth plans?
• Financing—is the incubators, financial base a reliable one, or is it on shaky ground?

QUESTION NINE

• a) Briefly explain five characteristics of a good business opportunity

 

• Less costly; a good business opportunity should be less expensive may it be an original idea or a franchise.
• Reduced risks of failure; a good business opportunity should have well executed research into the risks involved, personal strengths and any weaknesses the entrepreneur may deal with.
• Ready market; the market needs to be prepared for the product yet to be established
• High level of competence; a lot of time may be required to gather the necessary knowledge to prosper in any given business opportunity.
• Better financing options; a business opportunity may require stable cash flows and thus need to identify secure source of finance form investors.
• Professional advertising and promotion of the products to ensure there is competitive advantage.

QUESTION TEN

Distinguish between the following set of terms:

• Brainstorming and business incubation

Brainstorming is the process for generating creative ideas and solutions through intensive and freewheeling group discussion. Every participant is encouraged to think aloud and suggest as many ideas as possible, no matter seemingly how outlandish or bizarre. Analysis, discussion, or criticism of the aired ideas is allowed only when the brainstorming session is over and evaluation session begins. See also lateral thinking and nominal group technique

• Drone entrepreneurs and imitative entrepreneurs

Brainstorming is the process for generating creative ideas and solutions through intensive and freewheeling group discussion. Every participant is encouraged to think aloud and suggest as many ideas as possible, no matter seemingly how outlandish or bizarre. Analysis, discussion, or criticism of the aired ideas is allowed only when the brainstorming session is over and evaluation session begins. See also lateral thinking and nominal group technique

• Innovation and invention

Brainstorming is the process for generating creative ideas and solutions through intensive and freewheeling group discussion. Every participant is encouraged to think aloud and suggest as many ideas as possible, no matter seemingly how outlandish or bizarre. Analysis, discussion, or criticism of the aired ideas is allowed only when the brainstorming session is over and evaluation session begins. See also lateral thinking and nominal group technique

• Bank loan and bank overdraft

A bank loan is an extension of credit, to a consumer or business, in the form of borrowed funds which has to be paid back with interest.

Bank overdraft refers to a situation where the balance of funds withdrawn exceed funds deposited in a bank account

• Microfinance and youth fund

Microfinance is the provision of financial services to low-income clients, including consumers and the self-employed, who traditionally lack access to banking and related services.

Youth finance is finance which is extended to the youth in form of loan at lower interest rates so that they can use it to develop themselves financially and economical.