CREATIVITY AND INNOVATION

FOR ENTREPRENEURSHIP

LEARNING OBJECTIVES

After comprehensive study of this chapter, you will be able to:

 Creativity: components of creativity, creativity techniques
 Innovation: incremental versus disruptive innovation, sources of innovation, process of innovation:
prompts, inspirations and diagnoses, proposals and ideas, prototyping and pilots, sustaining, scaling and
diffusion, and systemic change
 Linking creativity, innovation, and entrepreneurship
26 Entrepreneurship & Business Resource Mapping

Concept of Creativity
Creativity is the ability of generating original and useful ideas. It is the process of creating
new product i.e. goods or services which are new for the organization or new for the market.
Creativity is the process through which invention occurs – the enabling process by which
something new comes into existence. Ideas are the outcomes of creativity. Ideas lead to
innovation, means the innovation is the result of creativity. For business innovation, ideas
are tested whether they can be commercialized or not. Only the potential ideas are
implemented for business purposes.
Innovative organizations are leading the market because of management of creativity.
Creativity management consists of steps and initiations for generating ideas, collecting and
organizing ideas, testing ideas for potential business, and implementation of best idea. For
effective creativity management, organizations should develop learning culture.
Management should motivate employees to generate new ideas and pay best tributes to the
best ideas. It is to remember that out of hundreds of ideas, few ideas will be best but these
best ideas pay for all. Experience, academic qualification, age, learning attitudes, etc.
influence in creativity.

Components of creativity

Creativity is the ability to develop new and unique ideas appropriate and actionable to
implement in the business. In entrepreneurship, creativity should generate business ideas
to fulfil the market needs. Imagination is the basis of creativity. Imaginative thinking is
one part of creativity with employee motivation and their knowledge. Creativity has thus,
following three components:
1. Skills for creative thinking
Creative thinking is the new and creative approach to look after the problem and its
solution. It is the special ability to integrate new ideas with existing knowledge and
skills to pursue the goals or to overcome the problem. Creative thinking is to generate
new idea which requires not only the environment but the extent to which a person
disagree with existing idea and knowledge. Creativity is also the outcome of
continuation of creation and sharing. It requires thinking, testing and formalizing of
the ideas. Creative thinking is based on the same kinds of cognitive processes that we
use in ordinary, everyday thought – retrieving memories, forming mental images,
and using concepts.
2. Knowledge
Knowledge is the composite of all the things a person knows. Knowledge can be
acquired through formal education, experience, interaction with other people and
learning habit. Knowledge helps to acquire skills to solve any problem, integrate
ideas, calculate the risk, and select the diversification techniques.
 Creativity and Innovation for Entrepreneurship  Chapter 2 27

3. Motivation
Motivation is the action for thinking critically and acquiring knowledge. Motivation is
essential to concentrate on developing new ideas or developing current ideas and
knowledge. It helps to concentrate to create the new way of thinking on existing
problem and the process. Motivation can be extrinsic or intrinsic based on the source
of motivation. Intrinsic motivation can be derived from internal passion and interest
of the person. Internal motivation leads for accepting challenge and increasing the
satisfaction. Such situation helps to be more creative. Job content and goal
accomplishment increase the intrinsic motivation. External factors like job context
i.e. working environment, monetary benefits and the provision of punishment for poor
performance are also responsible for creativity of the person. Extrinsic motivational
factors are generally competitive benefit i.e. return in the industry. Intrinsic
motivation is found sustaining reason for the creativity.

Creativity Technique

Creativity is not easy task as to excess by any person gets at any time and form. There
could be idea blockage in many cases where the person could not get any hint for new idea.
Motivational speakers, trainers and researchers have suggested various techniques which
can be helpful to get initial creative spark. Most common creativity techniques are
discussed below.
1. Problem reversal
Problem reversal is the technique in which the problem or situation is reviewed and
redefined from reverse i.e. opposite side. It suggests that managers should think
reversely as what happens if we do opposite? What are things other have not done?.
Actions in the problem reversal techniques should be started from inaction i.e. letting
go and not resisting nature’s way of achieving balance i.e. approached through upside
down, inside out and backward. Following steps are suggested to have problem
reversal:
 State the problem in reverse: At the beginning, we should first change the
positive statement into negative. Think to gather the information what things
can make the things worse. For example, if an entrepreneur is thinking what
products make customers satisfied, s/he should make a list of what dimensions
of the products make customers dissatisfied. From the list, the entrepreneur
can create the idea what should be done to satisfy the customers.
 Explore what others are not doing: To get new ideas, entrepreneur should
make a list of what others are not doing to get what to do. For instance, Android
version is created as after identifying the Nokia is not doing it. Electric car
companies have identified electric car by identifying other car companies are not
doing. One of the restaurant in Kathmandu provides hand sanitizer free of cost in
28 Entrepreneurship & Business Resource Mapping

each table instead of free Wi-Fi as others are not doing it. This technique is more
useful and easy to adapt in service product.
 Change the direction or location of perspective: There could be different
perspectives of products for different people and the place. For instance, Gold
Star shoes were famous in hilly region from the beginning but not in city area.
Food choice behavior may be different in different areas and the group of
people. So, for creation of new idea, we can ask the question what the other
people may prefer, what happens in other geographical region, etc.
 Turn defeat into victory: In many cases, new ideas, or the products can be
developed from the failure of one venture or idea. For instance, innovation of
cement, innovation of magnetic induction, etc. are the result of failing one
project or idea. Thus, for creativity, it is better to look the failure situation from
different angles thinking that what others possible if one idea gets failed.
2. Forced analogy or forced relationship
Forced analogy or forced relationship is the technique of creating new idea from the
relationship or association of two unrelated or unlike dimensions. Under this
technique, a fixed element of a product or an idea taken fixed and forced it to take on
the attributes of another unrelated element. From this, a guideline or the basis of
new idea is developed. For example, Olson1 described the problem of examining a
corporate organizational structure by comparing it with a matchbox.
Attributes of a matchbox Analogy with the corporation
Striking surface on two sides The protection an organization needs against strikes
Six sides Six essential organizational divisions
Sliding center section The heart of the organization should be 'slidable' or flexible
Made of cardboard Inexpensive method of structure, disposable

Forced analogy or forced relationships is more powerful game method of idea

creation. In this method, a card or object is randomly chosen as in above example and
the dimensions of the selected card or object are compared to the organization or the
business to get the idea.
3. Attribute listing
Under this technique, all the attributes of the product, idea or object are listed in
written form. Then, to change each attribute, a list of ways is prepared. After listing
a number of ideas, each idea is compared and evaluated to select best idea. This is
the most important technique of creating idea to focus on the particular product for
improvement or adding new dimensions. Following example makes the idea clear.
 Creativity and Innovation for Entrepreneurship  Chapter 2 29

Project : Improving torch light

Feature Attribute Ideas for Improvement

Casing Plastic Metal

Switch On/off On/off low beam

Battery Power Rechargeable

Bulb Glass Plastic

Weight Heavy Light

4. Mind maps
Human mind works in linear and association for comparing, integrating and
synthesizing the information. Association is the most important ability of human
mind as it can compare, relate and infers one object, person and event from another.
Each information can be linked with other many instances. Under mind mapping,
note are kept on the matter upon which the new ideas are to develop and association
between the factors, i.e., information are associated to create new idea. During this,
central idea is written and the associated ideas are thought. Central idea is written
at the center of the page and the works outwards in all the directions are added in
structured format. The mind forms associations almost instantaneously, and
mapping allows us to record ideas more quickly than we were expressing them using
only words or phrases.
5. Brainstorming
Brainstorming is the process of creating new ideas through group effort based on the
principle of suspending judgement. Under brainstorming, group of people participates
in discussion on common topic. Each member shares the idea, support or criticize the
idea of others and come to the conclusion. There will be two phases in brainstorming
process called generation phase and judgement phase. In the generation phase, people
create new ideas with certain logics and in the judgement phase they compare,
evaluate and select the best ideas.
For effective brainstorming, people involved in the brainstorming process are
suggested to follow the following rules :
 Suspend judgement: Under this rule, ideas created by each member are
written without any comment and critiques. This is most important otherwise,
specially the junior participants hesitate to suggest the ideas. As many of the
employees by human nature evaluate and comment the others idea instantly,
they need to be trained for suspend judgement.
 Think freely: After making the list of ideas suggested by each member of the
brainstorming group, now there should be open discussion on the ideas listed.
Discussion must of harmonious and each member is suggested to think out of
30 Entrepreneurship & Business Resource Mapping

the boundaries of ordinary and normal thoughts. Only the brilliant and
actionable ideas will be recorded.
 Encourage people to build the ideas of others: At this stage, people
concentrate only on selected ideas to improve, modify and build on the ideas of
others selected from above stage. Each member now tries to contribute how the
ideas can be improved for actionable business concept?, what changes can make
the idea better workable?, how the ideas can be modified if they can be made
better?
 Quantifying the ideas: At last, ideas are listed into numerical order.
Generally, the obvious, usual, stale, unworkable ideas tend to come to mind at
first. Thus, ideas at the first ten numbers may not be fresh and creative. Thus,
the later ideas at the list, more creative and fresh, should be selected. As long
the list of ideas is prepared, there will be the high chance of getting fresh and
creative ideas.

Factors Affecting Creativity

Creativity can be affected by number of factors. Basically, the social environment can
influence the frequency of creative behavior and level of creativity.2Following are the
important factors influencing the creativity.
1. Encouragement of creativity
Employees or the people involved in the organization should be encouraged in regular
basis in order to involve them in creativity. In absence of the encouragement, people
in general, wish to follow the regular and easy way of doing things or following the
normal way of thinking. There can be encouragement from three different levels i.e.
organizational level, supervisor level and workplace cooperation.
 Organizational level encouragement: There must be the culture for
encouraging and rewarding the best idea in the organization. Organization
should bear the risk of implementing new ideas, valuing the innovative ideas
with financial and non-financial, fair and supportive evaluation, social value to
the best creativity, alignment the creativity with performance appraisal and
reward system, etc. encourage the employees in creativity. Through research, it
is revealed that higher the organizational level encouragement, higher will be
the level of creativity and frequency.
 Supervisor level encouragement: Supervisors are involve with the
employees at most of the cases. They guide, supervise and apprise their
performance. Supervisors, thus, have most significance in creativity. Open
supervisory interactions and perceived supervisory support are more likely
motivate the employees being more creative. Fair and supportive evaluation of
the supervisor also encourage employees for creativity as such circumstances
help them likely to feel the less fear of negative criticism.
 Creativity and Innovation for Entrepreneurship  Chapter 2 31

 Workplace composition: The work group itself is good source of employee

encouragement. Workplace diversity and mutual cooperation between the
employees encourage them to be more creative. In such situation, employees
get confident and support from each other. They share their ideas and
suggestion to the other’s ideas to make them better. Workplace composition
thus, is another important factor of employee encouragement for creativity.
2. Autonomy
Autonomy is the decision making power to the employees. Autonomy increases the
sense of ownership on the ideas they create. In this situation, people create better
ideas for new product, working procedure, and way to increase the productivity. In
absence of autonomy, employee do not feel the ownership and pay low level of
commitment. Thus, autonomy influences on creativity.
3. Work load and pressure
Work load and pressure are the compliances to accomplish maximum job at minimum
time with higher degree of accuracy. In general, higher work load and pressure
negatively influence the level and frequency of creativity. This situation gives mental
pressure to accomplish the job urgently. But, if the situation is perceived as
important and urgent to solve the problem, people will likely to be more creative.
Thus, the influence of the work load and pressure to the creativity is paradoxical i.e.
inconsistent.
4. Adequacy of resources
Availability of the resources has direct influence to the creativity. Creativity requires
different types of resources. Information technology, knowledge source, physical
resources, etc. are more important in creation of new ideas. Resource availability
psychologically influences on the creativity.
5. Mental blocks
The condition in which nothing new can be thought is the mental block. In this
situation, people do not create new ideas. Basically, mental block may happen
because of two reasons, prejudice and functional fixation.
Prejudice results from how people preconceived with the traditional ideas about the
things. These preconception i.e. mental tie with traditional concept prevent us
thinking from new way. For example, a restaurant thinking with traditional way do
not think to ask self-service to increase the service efficiency as the service is basic
element of customer satisfaction. But, one can say first time creatively, that customer
may be satisfied if they serve themselves.
Functional fixation is the way of thinking in such a way that any product or process
or place should be fixed functionally. For example, function of coffee shop is to serve
coffee because people visit coffee shop for coffee only. This is a functional fixation.
Beyond this, it could be viewed as people may visit to coffee shop for social gathering
or business meetings. If this, coffee shop should maintain cabins, free Wi-Fi, and
probably other products like cookies and snacks.
32 Entrepreneurship & Business Resource Mapping

Concept of Innovation
Innovation literally, means to originate or revolute for anything new. It is the process of
developing ideas into visible and workable products. Innovation offers totally new thingor
offers new things with advancement. Novelty, i.e., newness of the product or uniqueness in
it determines how the product is viewed in the market place.
For innovation, there should be workable ideas but each idea does not sufficiently lead to
innovate. Creativity of idea cannot automatically be converted into goods and services,
though it is basis of innovation. Operationalization of the ideas into tangible goods or
visible service elements is the innovation. For innovation, once a business opportunity or
idea has been identified, it needs to be shaped and assessed, and eventually it has to
materialize in a prototype, formula, patent or business plan.
In the market, entrepreneurship can occur with little innovation and offering majority of
copycat goods. Many of the goods or services are improved in few dimensions and only very
few are totally new one. This means that innovation is not a necessary condition but
sufficient condition. But, greater extent of innovation makes the product unique in terms of
quality and utility dimensions. Greater degree of newness i.e. uniqueness supports to get
market share. Interestingly, majority of the innovated products get failed in the market
because of which many producers try product development instead of innovation. It is
therefore important to understand that innovation is a multidimensional concept, and that
it is not necessary to reinvent the wheel to become an entrepreneur.

Incremental versus Disruptive Innovation

Innovation is an attitude for the organization whether to invest in new product, service
and/or process. Through innovation, either new product is introduced or change in process
or any dimensions will be realized. Innovation can be incremental or disruptive. A brief
description of these two types of innovation is given below:
1. Incremental innovation
Incremental innovation, as its name, is the improvement in existing products through
enhancing performance dimension in it. For example, a restaurant invents the
delivery system with home delivery service. Likewise, the restaurant invents the
ordering system through mobile application. Mobile company introduces a new
version mobile with comparatively large screen. Banks have introduced mobile
banking system for balance transfer which reduces the administrative cost of
handling more customers from counter. In all these examples, innovation in existing
service is made within the basic product. So, these are the example of incremental
innovation. Thus, the purpose of incremental innovation is to improve the quality of
existing product and services. It is comparatively less costly and less risky. Such
innovations are initiated steadily and for improving the market share as the
innovation focuses to satisfy the unsatisfied dimension of customer within the same
product or product line.
 Creativity and Innovation for Entrepreneurship  Chapter 2 33

Incremental innovation can further be differentiated into following three types.

 Extension: Extension is the improvement or new use of an existing product,
service or process. In above example, home delivery service of a restaurant is
an extension.
 Duplication: Duplication is the replication of already existing or reputed
product in the market. Duplication may prevail in different market or in
different industries. For example, Tanduri is duplication from Indian market,
many local footwear products are duplicate in design from branded products.
Likewise, franchise are duplication of original producer.
 Synthesis: Synthesis is the formulation of new product through combination of
several product utilities and feature into one. For example, 4 in 1 printer
contains features of printer, photocopy, fax and scanner. Mobile is synthesis of
telephone, camera, internet, music player, etc.
2. Disruptive innovation
Disruptive innovation is the radical innovation in which totally new product based on
new technology is introduced in the market. Technological inventions are the results of
disruptive innovation. Such innovation can be within the existing product line but it
makes the product more convenient, less expensive, and customized. Such innovations
create fundamental changes in market situation and the level of competition within the
industry. Disruptive innovation is more complex and require more fundamental
changes in organizational settings and culture too. Thus, the corporations face
difficulty of choosing between sustaining technologies, which deliver improved product
performance, and disruptive ones, which may initially result in a worse performance.
Which is called as innovator’s dilemma.3There could be high chance of rejecting the
truly disruptive innovation by the customers or business society in the initial days of
innovation. Entrepreneurs seeking to create value through disruptive innovations take
one of the following three approaches;
i. the back-scratcher: Scratch and unscratched itch,
ii. the extreme makeover: make an ugly business attractive and
iii. the bottleneck buster: democratize a limited market, best suited on their
circumstances.
Following table demonstrate the difference between incremental and disruptive
innovation.
Incremental Innovation Disruptive Innovation
Steady improvements Fundamental rethink
Based on sustaining technologies Based on disruptive technologies
Obedience to cultural routines and norms Experimentation and play/make-believe
Can be rapidly implemented Need to be nurtured for long periods
Immediate gains Worse initial performance, potential big gains
Develop customer loyalty create new markets
34 Entrepreneurship & Business Resource Mapping

Sources of Innovation
Innovation may result from different sources. These sources are broadly classified into two
categories as discussed below.
1. Sources of innovation within companies or industries
Innovators get the opportunity of new ideas and innovation within the companies or
industries. Such sources basically provide opportunity of incremental innovation.
Following are the major sources of innovation within the companies or industries.
 Unexpected occurrences: Many innovation can happen by chance or accidently.
Scientists get the new things most probably the unexpected product during the
course of action. Such outcomes i.e. products or technology are later recorded.
 Incongruities: Incongruities are the incompatibilities or inconsistencies
between actual happening and the expectations. Innovations can be resulted
from thinking to mitigate such incongruence.
 Process needs: Innovations are really demanded by the entrepreneurs in order
to improve the product or service. A group of people or personally workout to
innovate the desired product, or the process.
 Industry and market change: There could be frequent changes in industry
and market dimensions. To fulfill the gaps in existing product line and the
market situation, organizations prefer innovation. Market leaders often try to
grab the market opportunities created because of such changes.
2. Sources of innovation in the social environment
Social environment provides the ample opportunity for innovation. Change in social
dimensions create the opportunities for innovation. Following are sources for
innovation in social environment.
 Demographic changes: Changes in age group, gender, increasing number in
working women, shifts in marriage age, number of children in the family, etc. are
the common changes in social demographic dimensions. Changes in such
dimensions change the priorities of customers and hence change in business.
Innovators identify such changes and innovate new product, service and process.
They can develop in existing products to cope with emerging market demand.
 Perceptual change: Social perception could be change along with
advancement in telecommunication, level of education and experience. Such
changes in perception may influence the priorities, for instance, social
perception on marriage in Nepalese society has been changing so that the
dowry system is gradually decreasing. This has created challenges to some
business while business organization are forced to create new products. Outing
behavior in Nepalese society is gradually changing and hence the restaurants
are getting more business. They need to innovate new products to sustain the
opportunity. Because of changes in social perception, say educating daughter,
has raised female concentrating opportunities and hence innovators need to
innovate new products.
 Creativity and Innovation for Entrepreneurship  Chapter 2 35

 New knowledge: Passion on creating new knowledge is the strong source of

innovation. It takes long time to create new knowledge but knowledge-based
innovation gets more attraction and importance in the area of
entrepreneurship. Technology is knowledge-based innovation.

Innovation Process
Following steps are common in the innovation process:

Prompts, Inspirations and Diagnosis

Literal meaning of prompts is to make something happen. It makes someone decide to do
something. Prompts are the stimuli for innovation. Basically, problems, deficiencies and the
crisis situations stimulate the people for innovation. For instance, if a manager realizes
poor quality of the product and frequent complaints from customers, then s/he realizes
there should be new way of doing the things so that the quality can be improved, and the
customer satisfaction can be increased. Here, such problems compel to innovate.
Inspirations are basically induced with probable opportunities from innovation. This
means, people get inspirations for the potential opportunities to be developed through
innovation. Thus, as a inception of innovation process, first of all, problems are realized,
analyzed and diagnosed for actual problem areas.

Proposals and Ideas

After diagnosis of the problem, innovator tries to generate new idea with formal methods of
design or creativity. In this stage, insights and experiences are gathered through various
sources like citizens, users, communities, front line staff, customers, competitors, etc. Proposal
for innovation along with the utilities and economic benefits are prepared in details.

Prototyping and Pilots

A prototype is a draft version of a product that allows innovator to explore ideas and show the
intention behind overall design concept along with full features before investing. Designers
provide simple, scaled down versions of the product in order to observe, record, judge, and
measure user performance levels based on specific elements. Such earlier version of the
product is known as prototype. Such prototypes need to be refined before the public offer. This
stage is important in social process as the ideas are tested practically, refined for business
purposes, and developed for more advanced benefits. For instance, mobiles or a car is first
prototyped and observed for its deficiencies before producing it in the form of business venture.
After refinement of the product, it is tested for small segment of the customers, called pilots.

Sustaining
After successful launch of the product through pilots, it is essential to develop the structures
and sustainable income streams of the product ensuring that the best ideas can be ventured as
a business product. For this, resources, networks and practices need to be organized and best
36 Entrepreneurship & Business Resource Mapping

possible, cost effective, and competitive product is developed. In this stage, budgets, teams and
other resources essential for business venture from the idea are identified.

Scaling and Diffusion

In this stage, a range of strategies to grow and spreading an innovation are formulated and
implemented. This means in this stage, action plans for implanting the innovation is
mounted. Organization growth, franchising or licencing are the common strategies for
formal growth of the innovation. Sustainability of the innovation plays vital role in
spreading the innovation. After production of the product, effective circulation i.e. diffusion
is managed through effective distribution channel.

Systematic change
This is the desired goal of the social innovation which aims to change the current situation
for betterment. Systematic change becomes possible through interaction of many elements
such as social movements, business models, laws and regulations, data and infrastructures,
and entirely new ways of thinking and doing. For effective change implementation,
innovators, management and even entire society should come up with many similar
innovation to support side by side. In this stage, many traditional order of the things should
be broken down and newness need to be accepted.

Karna Shakya
Karna Shakya has different identities as environmentalist,
conservationist, hotel entrepreneur, writer and philanthropist. He was
born in 1943 AD in Kathmandu. He is known as one of the most
inspiring and motivational entrepreneurs in Nepal.
Though he has an academic background in forestry and started serving as a wildlife
officer, he entered into the tourism industry with establishing Kathmandu Guest
House (KGH) in Thamel. Sakya is the one key person for shifting Thamel as tourism
hub from Freak Street. He has now chain of eco-friendly hotels in Kathmandu,
Pokhara, Chitwan and Lumbini.
He is well-known conservationist in Nepal. He played remarkable role in
establishing National Pakes and Conservation Area for the protection and
conservation of forest and wild animals. He is now developing fund for fighting
against Cancer. He started lobbying i.e. national campaign to bring awareness on
cancer prevention and creating fund for contribution from sales of each cigarette
which now is the major source of anti-cancer fund (national tax on cigarettes i.e. one
paisa from each stick cigarette)in Nepal. His dedicated effort resulted as establishing
the first cancer hospital in Bharatpur, Nepal. He has written books like Soch, Khoj,
Ma sakchu and Moj as motivational books for people to strive against the passivism,
frustration and brain drain. He is a role model for young entrepreneurs.
 Creativity and Innovation for Entrepreneurship  Chapter 2 37

Linking Creativity, Innovation and Entrepreneurship

To remain competitive in the market; creativity, innovation and entrepreneurship are vital for
organizations Investigations of creativity, innovation and entrepreneurship have different
dimensions and foundations but linked each other. To be innovative, firms must exercise
creativity. And creativity and innovation are necessary for them to be entrepreneurial.
Creativity is the ability to imagine new concepts where value creation is not essential. For
creativity we run brainstorming sessions; but do not allow concepts to be screened for
merit. We try to identify as many ideas as possible from creative thinking. Ideas obtained
through the creativity are converted into product i.e. goods and services as innovation.
Thus, creativity is the front end component of innovation.
Innovation is the process through which value is created and delivered to a target
customers. Innovation is used to deliver newness in the product. From innovation, if the
goods or services are registered as patent, then it is called invention. Invention must
possess to be patentable – novelty, non-obviousness, utility as distinct from an innovation.
Innovations must answer to much wider audience. They must be adopted in practice by the
intended user community to be considered a true innovation. Thus, businesses should be
focused on innovation than in invention.
Entrepreneurship is the outcome of creativity and innovation as the basic element of
entrepreneurship is offering new things to the customers. Entrepreneurs bear risk of
investment and convert best idea into innovation to make business, create value and expansion.
Following figure further explains how these three terms are linked.4
This figure integrates series of interdependent stages. This process consists of complex set
of communication paths over which knowledge is transferred. The process consists
innovation at the center which is represents the firm’s capabilities and its linkage with both
market place and technology. Entrepreneurship is affected by two factors i.e. unsatisfied
market needs and technological process. This process can also be explained as the
successive stages of idea generation (creativity), ideas evaluation (innovation) and ideas
implementation (entrepreneurship).

Latest science &

technology Technology
push
Creativity Innovation Entrepreneurship
š Production of new and š Refining, evaluation and first š Creation of value in the
useful ideas materialization of the new marketplace
š Discovery of ideas š Exploitation of opportunities
opportunities š Evaluation of opportunities š Output: New products, services
š Output: new ideas š Output: Prototype, patent, or processes
business plan

Market
Needs in society and in the pull
marketplace
38 Entrepreneursh
hip & Business Resource Mapp
ping

 Concept of Creativity : Creativity

C is the ability of generating
g orriginal and usseful ideas. It is the
process of creating
c new product
p i.e. gooods or servicces which are new for the o organization or
o new
for the markket.
 Componentts of creativityy
š Skillss for creative
e thinking :Crreative thinkiing is based on the samee kinds of coggnitive
proceesses that we use in ord dinary, everydday thought – retrieving memories, fo orming
menttal images, an nd using conceepts.
š Know wledge :Know wledge helps to acquire skillss to solvee any problem, integrate ideas,
ulate the risk, and select thee diversificatio
calcu on techniquess.
š Motiivation :Motivvation is essen ntial to concentrate on devveloping new ideas or deve eloping
in current ideas annd knowledgee. It helps to concentrate
c too create the n
new way of th hinking
on exxisting problem and the pro ocess.
 Creativity Technique
š Problem reversal :Problem revversal is the te echnique in which
w the problem or situaation is
revieewed and redeefined from reeverse i.e. opp
posite side.
š Force ed analogy or o forced rellationship :Fo orced analoggy or forced relationship is the
techn nique of creating new ideaa from the re elationship or association o of two unrelaated or
unlikke dimensionss. Under this technique, a fixed elemen nt of a product or an idea taken
fixed and forced itt to take on thhe attributes of
o another unrrelated elemeent.
š Attribute listing :UUnder this tecchnique, all th
he attributes of o the productt, idea or objeect are
listed
d in written foorm. Then, to change each attribute,
a a lisst of ways is p
prepared.
š Mind d maps :Human mind workks in linear an nd association n for comparing, integratin ng and
synthhesizing the innformation. Association is the
t most impo ortant ability o
of human min nd as it
can compare,
c relatte and infers one
o object, pe erson and eveent from another.
š Brainnstorming :Brrainstorming is the processs of creating new ideas th hrough group effort
based d on the prin nciple of susppending judge ement. Under brainstormin ng, group of people
p
participates in disccussion on com mmon topic.
 Factors Affe ecting Creativvity
š Encouragement off creativity
š Autonomy
š Workk load and preessure
š Adeq quacy of resou urces
š Menttal blocks
 Concept of Innovation: Innovation means m to originate or revo olute for anytthing new. It is the
process of developing
d id
deas into visibble and workkable productts. Innovation n offers totally new
thing or offeers new thinggs with advanccement. Nove elty i.e. newneess of the pro oduct or uniquueness
in it determines how the product is vieewed in the market
m place.
 Incremental innovation: Incremental innovation
i is the
t improvem ment in existin ng products thhrough
enhancing performance
p dimension in it. For example, a restaurrant invents tthe delivery systems
with home delivery
d servicce.
 Creativity and Innovation for Entrepreneurship  Chapter 2 39

 Disruptive innovation: Disruptive innovation is the radical innovation in which totally new
product based on new technology is introduced in the market. Technological inventions are the
results of disruptive innovation.
 Sources of Innovation
a. Sources of innovation within companies or industries
š Unexpected occurrences
š Incongruities
š Process needs
š Industry and market change
b. Sources of innovation in the social environment
š Demographic changes
š Perceptual change
š New knowledge
 Social innovation: The approach of solving the social problems with more collaborative and
inclusive way is termed as social innovation. Social innovation helps to satisfy the social needs
simultaneously and more effectively than existing solutions.
 Innovation Process
1. Prompts, Inspirations and Diagnosis: Prompts are the stimuli for innovation. Basically,
problems, deficiencies and the crisis situations stimulate the people for innovation.
2. Proposalsand Ideas: Proposal for innovation along with the utilities and economic benefits
are prepared in details.
3. Prototyping and Pilots: Prototypes is a draft version of a product that allows innovator to
explore ideas and show the intention behind overall design concept along with full
features to before investing.After refinement of the product, it is tested for small segment
of the customers, called pilots.
4. Sustaining: After successful launch of the product through pilots, it is essential to develop
the structures and sustainable income streams of the product ensuring that the best ideas
can be ventured as a business product.
5. Scaling and Diffusion: In this stage, a range of strategies to grow and spreading an
innovation are formulated and implemented.
6. Systematic change : Systematic change becomes possible through interaction of many
elements such as social movements, business models, laws and regulations, data and
infrastructures, and entirely new ways of thinking and doing.

Case Studies
Educating poor youth in Nepal with innovative and affordable private schools
Samata Shiksha Niketan or The Bamboo School Project dreamed to have education
access to the poor and disadvantages children at the cheapest fees NRs. 100 per
month. It became reality with Mr. Uttam Sanjel in 2001 with the objective to provide a
quality education for a low fee to underprivileged children in Nepal. This project now is
expanded all over Nepal with the known brand name (bamboo school, a readily
available, inexpensive, portable material and corrugated iron roofs).
Mr. Sanjel established the Samata Shiksha Niketan School in 2001, in an effort to reduce
the education gap between the rich and the poor. In a country where the public
40 Entrepreneurship & Business Resource Mapping

educational system is deeply flawed and private education is impossibly expensive,

Samata with the innovative idea of Mr. Sanjel has become the largest chain of private
schools in Nepal with 38,000 students, 75% of them girls, in 19 districts across the country.
In Kathmandu, it offers undergraduate and postgraduate courses too. Among the
children, majority are from the working-class neighborhoods, with no distinction made
based on origin, caste, or religion. They get education not only on core subject course
but they get the more pragmatic life skills, and enjoy a nutritious hot meal and access
to clean water.
In 2008, Karuna-Shechen’s president Matthieu Ricard and Uttam Sanjel, the founder of
Samata Siksha Niketan, formed a partnership to help the project achieve ambition to
build a school in each district which became more successful for the journey. Together
with Karuna-Shechen, Samata Siksha Niketan has built eight in 2015, two devastating
earthquakes shook Nepal to its core, causing catastrophic damage throughout the
country.
Various research reports and the results of examination justify the quality of education.
They also facilitate help camp and focus for value education. Thus, students and their
parents are satisfied. Different national figures e.g. Madan Krishna Shrestha and
Hari Bansha Acharya, social organization, and even the private business organizations
are also joining their hands to support the project now. They donate furniture, reading
materials, cash and kinds.
Samata Siksha Niketan manages the schools. The management committee is
responsible for the formation, implementation, and monitoring of all policies and
administration. Energetic and experienced principals run the schools and their prime
duty is to upgrade the quality of education through creative and constructive
supervision. The principals are responsible for the day-to-day administration with the
help of a Coordinator and Vice-Principal.
Frequent staff meetings are conducted to promote teachers’ interaction and
cooperation in attending to the student’s needs. Several activities are organized for
students including drawing competitions, essay competitions, and so on. The teachers
are qualified, honest, and dedicated to their job. More than fifty percent of teachers
have obtained professional degrees and the rest are in training. There is a low
changeover rate of teachers, as they are committed to the school and students. There
are discussion groups in all classes and students receive regular homework assignments.
Parents are encouraged to help their children in their homework. Morning assembly is
one of the most positive aspects of the bamboo schools’ education as the assembly
emphasizes ethics, compassion, and moral behavior. This helps the students to become
good citizens. It also influences the family members and thus, the nation.
(Source: http://samatashikshaniketan.blogspot.com/).
Questions:
1. Explain the possibility of social innovation movement in education sector in Nepal.
2. Over the many failing projects, Samata Shikshya Niketan proved that the
dedication and passion move the project to success. How can you prove the
project is successful?
3. What special characteristics are essential to be successful in social innovations?
 Creativity and Innovation for Entrepreneurship  Chapter 2 41

Questions for Discussion

Brief Answer Questions
1. What is creativity?
2. Mention different components of creativity.
3. List out different creativity techniques.
4. What is meant by forced analogy?
5. Highlight the concept of mind mapping.
6. Define brainstorming.
7. What are the factors affecting creativity?
8. Mention various factors affecting creativity.
9. Describe the concept of innovation.
10. Differentiate between incremental innovation and disruptive innovation.
11. List out the sources of innovation within companies.
12. Mention the various sources of innovation in the social environment.
13. Elaborate social innovation.
14. State innovation process.
15. What is prototyping?
16. Describe the systemic change.
Short Answer Questions
17. Describe the components of creativity.
18. Explain the different techniques for creativity.
19. Explain different factors affecting creativity.
20. Explain the concept of innovation. Differentiate between incremental innovation and
disruptive innovation.
21. Explain different sources of innovation.
22. Define social innovation. Explain the key factors of social innovation process.
23. Explain different principles of social innovation.
24. Define social innovation. Explain the significance of social innovation.
25. Explain in brief, the social innovation process.
26. Explain the prototyping and pilots in social innovation process.
27. Define social entrepreneurship. Explain feature of social entrepreneurship.
28. Explain in brief, different approaches of social entrepreneurship.
29. Who are social entrepreneurs? Explain different features of social entrepreneurs.
42 Entrepreneurship & Business Resource Mapping

30. Explain the linkage between creativity, innovation and entrepreneurship.

Long Answer Questions
31. Creativity is the backbone of entrepreneurial success. Explain the statement and
describe different techniques used for creativity.
32. Creativity is not the piece of cake for everyone. It is affected by several factors. Based
on the statement, explain various factors affecting creativity.
33. How does incremental innovation differ from disruptive innovation? Explain the
different sources of innovation.
34. Analyze the role of linking creativity, innovation, and entrepreneurship.

END NOTES

1. Olson, R. (1986). The Art of Creative Thinking. New York: Harper Perennial. In
Shapter, M., Volery, T., Weber, P., & Lewis, K. (2017). Entrepreneurship and
Small Business. New Delhi: Wiley India Pvt. Ltd.
2. Amabile, T., Conti, R., Coon, H., Lazenby, J., & Herron, M.(1996). Assessing the
work environment for creativity. Academy of Management Journal. 39(5), 1154-84.
3. Christensen, C.M. (1997). The Innovator’s Dilemma. Boston: Harvard Business
Press. In Shapter, M., Volery, T., Weber, P., & Lewis, K. (2017). Entrepreneurship
and Small Business. New Delhi: Wiley India Pvt. Ltd.
4. Shapter, M., Volery, T., Weber, P., & Lewis, K. (2017). Entrepreneurship and
Small Business. New Delhi: Wiley India Pvt. Ltd.

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