Every venture starts with an idea, but not every idea is fit to become a venture. In this chapter we distinguish between ideas and opportunities, present the sources from which opportunities arise as Drucker classified them, and then offer practical techniques for generating ideas, and criteria for evaluating them and choosing those most worth pursuing.
After studying this chapter, you should be able to:
Many students come to this course with a "project idea" in mind and ask: Is it a good idea? The more precise question is: Is it an opportunity? An idea is a picture in your mind of a product or service. It may be attractive and original, but it only becomes an opportunity when certain conditions exist in reality. These conditions can be summed up in four:
| Condition | The question that tests it | An example of its absence |
|---|---|---|
| Real need | Do people actually suffer from the problem you solve? | An app for scheduling when to drink water, when people do not see this as a problem worth an app. |
| Willingness to pay | Are there enough people who will pay money or time for the solution? | A service users love and use, but will not pay anything for. |
| Right timing | Are the market, technology and society ready now? | An electronic payment service before smartphone use became widespread. |
| Ability to execute | Can you and your team deliver it with the resources available? | An idea that needs a factory and complex licenses the team cannot obtain at the start. |
This means a good idea may not be an opportunity right now, and a very simple idea may be an excellent opportunity. An automatic reminder service for car maintenance and document renewals is not a brilliant idea, but it may be a real opportunity: a clear need that many people live with, willingness to pay among those who own more than one car, the right timing, and feasible execution.
Peter Drucker argued that opportunities rarely come from sudden inspiration; they come from change. Every change in society, the market or knowledge opens a gap that a venture can fill. He identified seven sources of change, ordered from the easiest and least risky to the hardest:
A success you did not plan, a failure you did not expect, or a sudden outside event. These surprises are the easiest source of opportunity, but many people ignore them because they do not fit their plans. Example: an online store for desert camping gear noticed that a "ready weekend trip bundle" it had listed as a trial outsold individual products. That is a sign customers are buying "a hassle-free trip," not just equipment.
A gap between what is and what ought to be, or between what people expect and what they get. Example: a service people need often and pay for, yet the experience is poor, such as home maintenance appointments that nobody keeps. This incongruity is an opportunity for whoever offers the same service with reliability and clarity.
A weak link inside a procedure or workflow that holds up everything before and after it. Example: a procedure that has become fully digital except for one step requiring a stamped paper; or a fast-food restaurant that is quick at everything except payment at peak times. Whoever fixes that link delivers a lot of value.
When the way an entire sector works changes, opportunities arise for newcomers, because established firms are slow to adapt. Example: the shift of shopping online created demand for packaging services, professional product photography, and online store management for traditional shops.
Changes in population size, age, education, and where people live and work. These are among the clearest sources of opportunity because they can be measured and anticipated. Example: a society with a large share of young people needs entertainment, education and fitness services, while one with a growing number of older people needs home care and accessible transport. More women entering the workforce has created demand for childcare and healthy ready meals.
When what people care about and value changes, even if the facts themselves have not. Example: growing interest in health and natural food created a market for organic products and specialized gyms. Concern for the environment created a market for recycling and sustainable products.
Scientific discoveries and new technologies. This is the most exciting source, but also the hardest and riskiest, because turning new knowledge into a product takes a long time and needs other complementary technologies and knowledge. Example: today's AI tools open opportunities in education, customer service, translation and analysis, but succeeding with a venture in this area takes more than just using the technology.
Alongside Drucker's sources, there are practical entry points a student can start from today:
Generating ideas is a skill with tools, not a matter of waiting for inspiration. The first rule in all of these tools is: separate generating from evaluating. While generating ideas, do not judge them, because early criticism kills ideas before they mature and makes people stop contributing. Evaluation comes later.
Developed by Alex Osborn in the mid-twentieth century, it rests on four rules: no criticism during the session, quantity before quality, welcome unusual ideas, and build on others' ideas. In practice: set a clear question, give the team a fixed time (ten minutes, for example), write each idea on a separate sticky note, then group them when time is up.
Instead of asking "How do we solve the problem?", ask "How do we make it worse?" This question frees people from the fear of being wrong and produces many ideas quickly. Then reverse each bad idea to reach a solution. Example: "How do we make waiting at the clinic worse for patients?" → "Don't tell them when their turn will come." Reversed: "Send them a message with the approximate time of their turn so they can move around freely."
Write the topic in the center of the page (for example, "the patient's journey through the hospital"), then branch out to the main aspects (booking, arrival and parking, waiting, examination, pharmacy, follow-up), then branch from each aspect into its details and problems. The map helps you see connections between ideas and discover problems you had not thought of.
A list of seven questions developed by Bob Eberle, building on Osborn's work. You apply it to an existing product or service to generate new ideas from it. Each letter stands for a question:
| Letter | Question | Example for "a phone repair shop" |
|---|---|---|
| S: Substitute | What if we replaced part of the service, its materials or who provides it? | Instead of the customer coming to the shop, we collect the device from their home or office and return it. |
| C: Combine | What if we combined it with another service? | Repair + data transfer + screen protection in one bundle. |
| A: Adapt | What successful idea from another field could be adapted here? | The "tracking" system of shipping companies: the customer knows where their repair has reached. |
| M: Modify | What if we enlarged, shrank, or changed the form or timing? | A temporary loan phone the customer uses until the repair is done. |
| P: Put to another use | Could it serve another customer or purpose? | Maintaining small companies' staff devices under a monthly contract. |
| E: Eliminate | What could be removed to make it simpler or cheaper? | Eliminate waiting in the shop: a fixed pickup appointment. |
| R: Reverse | What if we reversed the order or the roles? | Instead of selling repairs after a breakdown, sell a protection subscription before it. |
A technique developed at Toyota to analyze the causes of problems. You ask "Why?" several times in a row until you reach the root cause instead of the visible symptom. Example:
Now the opportunity changes: the problem is not "patients are unreliable" but "there is no automatic reminder," and the solution may be very simple and could be offered to many clinics.
A phrasing used in design thinking that turns a problem into an open question inviting solutions. Instead of "Older people can't use government apps," you say: "How might we help older people complete their online transactions on their own, with confidence?" "How" assumes a solution is possible, "might" opens up possibilities, and "we" makes it the team's responsibility.
After generating dozens of ideas, you need a systematic way to choose which ones deserve follow-up. The simplest way is to put the ideas in a table and score each from 1 to 5 on a set of criteria:
| Criterion | Question | What raises the score? |
|---|---|---|
| Value | Does it solve a painful or recurring problem? | A problem people face often and look for a solution to |
| Demand | Are there enough customers? Will they pay? | Many customers who pay today for worse solutions |
| Feasibility | Can we deliver it with our resources and skills? | A simple version can be started within weeks |
| Distinctiveness | What makes it better than the alternatives? | A clear advantage the customer notices immediately |
| All parties satisfied | Does everyone win: the customer, the entrepreneur, the service provider and the partner? | The customer pays an amount they see as fair, and it is enough for every party to earn what they deserve (see Chapter 6) |
| Growth | Can it get bigger? | It can be taken to other places or groups |
| Team fit | Are we excited about it and qualified to deliver it? | It connects to our field and interests |
Some criteria can carry more weight. "Value" is the most important, because an idea that does not solve a real problem will not be rescued by any other criterion. Next comes "all parties satisfied," because many ideas customers love fall apart because they are exhausting or loss-making for whoever delivers them, as we will see with numbers in Chapter 6. Remember that this evaluation is preliminary and based on the team's estimates; the real verdict comes from customers in the chapters ahead.
The answers are on the Answers to Self-Assessment Questions page. On the interactive course page you can answer and check these questions directly, with practical tools linked to the chapter.
Choose one of Drucker's seven sources, and find an example of it in your city this year.