Entrepreneurship is the act of capturing ideas, converting them into products or services, and building venture to take them to market allows innovation to realise its economic value. It uses innovation to expand business scope and boost growth and therefore should be considered a holistic approach rather than one solely concentrating on the initial stages of new ventures (Zhao, 2005).
To achieve H3 business that creates genuinely new business ideas is not as straightforward as business leaders might imagine. Furr et al (2019) identified in their research that simply arming teams with the knowledge and tools of human centred design (such as design thinking) and lean startup principles of build-measure-learn is not enough. Entrepreneurs have the freedom to foster radical and audacious solutions that are far from the markets current offerings. Individuals should not be limited by the bias of their existing environment.
Furr et al (2019) suggest that limitations of individuals to see beyond incremental and inspire creativity in ideation can be linked to what researchers refer to as ‘local search bias’, This can be identified as the following three factors:
- Availability bias — substituting available data for representative data;
- Familiarity bias — overvaluing things we already know;
- Confirmation bias — thinking new data proves existing beliefs;
As a result, individuals have a tendency to identify opportunities only related to the status quo rather than those which are on the boundaries of what we do today (Furr et al, 2019).
McGrafth (2018) in The Entrepreneurial Mindset suggest that those organisations committed to growth develop and manage a portfolio of related business experiments, projects and other activities within a target area in an attempt to create opportunities for long term growth. These are underpinned by a process of try, fail, learn quickly, and try again, consider also Ries, 2011 Lean Startup.
And so to adopt an entrepreneurial mindset alone is not enough without the processes and structures in place to support these opportunities for individuals within an organisation to experiment.
Considering the studies of Zhao (2005) and Furr et al (2019), by creating an entrepreneurial mindset we create opportunities for innovation of all scales, H1 > H3.
To unleash this creative confidence for those who partake within an organisations innovation ecosystem, and maximise our ability to generate H3 new business opportunities we need to understand how to best remove these local bias’ that prevent individuals looking past the incremental opportunities, and find the right structures and incentives to give them the freedom to experiment.
The role of the organisation to create an environment that support entrepreneurial behaviours and nurture the emotional support to experiment and fail will provide greatest opportunities for creative confidence.
Furr, J., Dyer, J.H., and Nel, K. (2019) When your moon shots don’t take off. Harvard Business Review (97/1) pp. 112–117
McGrafth, A. (2018) The Entrepreneurial Mindset. Available https:// www.gettingsmart.com/2018/03/the-entrepreneurial-mindset/ (Accessed 6th November 2019)
Ries, E (2011) The Lean Startup: How today’s entrepreneurs use continuous innovation to create radically successful business. New York: Crown Business.
Zhao, F. (2005) Exploring the synergy between entrepreneurship and innovation. International Journal of Entrepreneurial Behavior and Research (11,1) pp. 25–41