What is the Eureka moment for your business idea?
Discussion About Opportunity Recognition and Opportunity Formation
Ever since the day that Archimedes, the famous Greek mathematician, leapt from his bathtub and ran through the streets of ancient Syracuse triumphantly shouting Eureka, “I found it!,” the history of science, technology, and business has been punctuated by exciting moments of true insight and discovery.
It was during a visit to the baths that he was lost in thought, contemplating the problem of how to test the purity of the gold in King Hiero’s crown without destroying it. He noticed the water overflowing from his bath and discovered his solution: Drop the crown into water and measure the amount of water displaced.
At the heart of even the most complex innovation there is usually a basic, and yet startling “entrepreneurial insight,” a new way of looking at an old problem. James Watt’s sight of snow on the Green of Glasgow in the spring of 1765 led to the invention of the condenser, and he went on to change the world.
Peter Drucker says entrepreneurs are “kissed by the Muses” and have a “flash of genius.” Every business begins with just an idea, and opportunity recognition suggests that good ideas for new ventures are “waiting to be discovered by an astute observer.”
What Is the Strategic Inflection Point in Your Industry?
Whole industries can become vulnerable to “new rules,” but entrepreneurs see such change as the norm and healthy. In fact, the entrepreneur always searches for change, responds to it, and exploits it as an exceptional opportunity. Taking root in a disruption is the first condition that entrepreneurs need to meet to improve the probability of successfully creating a new growth business. In fact, research has shown that if they cannot or do not do this, their odds of success are much smaller.
The disruptive technological changes we discuss are the principal drivers of competition in the world today. Technological change plays a major role in industry structural change, as well as in creating new opportunities. Many of today’s great companies grew out of technological changes that they were able to exploit.
Andrew Grove, CEO of Intel from 1987 to 1997, was instrumental in making Intel one of the great success stories of entrepreneurial capitalism. In Only the Paranoid Survive, he defines “strategic inflection points” as major changes in the competitive environment that can threaten a company’s livelihood if not addressed effectively. He said that it is easy to miss the potential of new technologies and the impact of new competition that springs from these inflection points.
Grove and co-founder Gordon Moore, in the wake of the disruptive processor chip, literally saved Intel with one question. Grove asked, “If we had to start all over, would we start with the DRAM chips?” Moore said “No,” and they successfully transitioned Intel from DRAM chips to microprocessor chips.
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