An exploratory study of entrepreneurial opportunity recognition of small and medium sized enterprises

An Exploratory Study of Entrepreneurial Opportunity Recognition of Small and Medium Sized Enterprises Ngo Lien Thao Tran Tien Khoa Nguyen Van Phuong International University, Vietnam National University HCMC, Vietnam Abstract Small medium sized enterprises (SMEs) have been playing a crucial role in enhancing the economic development and growth in most countries The ways in which SMEs recognize their entrepreneurial opportunities need to be investigated This paper aims to explore different patterns in the processes of entrepreneurial opportunity recognition from SMEs’ founders The study adopts qualitative method and conducts 16 semi-structured in-depth interviews with the founders of currently operating SMEs to identify opportunity for entrepreneurship in Vietnam As the result, a successful process of entrepreneurial opportunity recognition requires an aggregation of prior knowledge and network ties which have been nurtured for years before, along with the employment on either or both use of entrepreneurial alertness and market analysis This study proves that possessing an ability to analyze the market is as much important as staying alert toward opportunities Besides, a level of creativity of entrepreneurs will be triggered to respond to situations in which the entrepreneurial opportunities arise However, founders of SMEs generate more adaptive style of creativity than innovative one since being market driven Keywords: opportunity recognition; entrepreneurship; SMEs 654 Introduction SMEs are an important part of an economy and bring undeniable welfare to the society In Vietnam, they account for 97% of total enterprises, of which nearly 60% are small-sized enterprises (General Statistics Office, 2017) The Provincial Competitiveness Index (PCI) 2015 survey jointly made by attempt of Vietnam Chamber of Commerce and Industry (VCCI) along the United States Agency for International Development (USAID) also presented the similar figures: Among the 8,335 domestic private enterprises responding to the PCI survey, 97.3% are small and medium sized Within such diverse business environment, SMEs are the engine of economic growth in the emerging markets and significantly contribute to national development SMEs in Vietnam occupy more than 40% of gross domestic product (GDP), contribute 31% to the total national budget and provide more than 50% of total employment (Oxford Business Group, 2017) Moreover, SMEs’ contribution to social welfare security and poverty reduction in Vietnam has been widely acknowledged SMEs are not only major sources of employment opportunity, but also foster productivity and make the environment become more dynamic and competitive (Audretsch, Thurik, Verheul & Wennekers, 2002; Westhead, Uchasaran, & Wright, 2009) Detecting and electing the appropriate opportunities are the vital activities to help create successful businesses (Stevenson, Roberts, & Grousbeck, 1985) During last 20 years, many scholars have conducted numerous researches about opportunity recognition and development from a variety of theoretical perspectives and numerous aspects like business, sociology, psychology, and economics They highly contributed to the understanding of this field; however, opportunity recognition has borne differences and conflicts causing the inhomogeneity (Ardichvili, Cardozo, & Ray, 2003) One of the reasons is that each solely focuses on only one of the various elements affecting the recognition of entrepreneurial opportunity For example, Gaglio and Katz (2001) look into the entrepreneurial alertness involved in opportunity recognition in terms of social psychology, while Shane (2000) concentrates on the essential prior experience and knowledge for successful recognition, then Dyer, Gregersen, and Christensen (2008) investigate the impact of innovation on opportunity The fact that scholars pay attention to specific elements ensue many full-scale studies about singular factors while neglecting an overview of all equally crucial elements and how they may engage together in the same subject of study Furthermore, there is little agreement on the main notions used to identify and operationalize the process (Hansen, Shrader, & Monllor, 2011) Vagueness around how founders of SMEs recognize opportunities for their business growth still appears in academic research, especially when SMEs are now confronting the fast-paced transformation of technology and the world economic integration (Thai & Chong, 2008) Disclosure of the complex developing process of opportunities recognition is the central section of entrepreneurship research (Venkataraman, 1997) This study is dedicated to focus on the phenomenon of entrepreneurial opportunity recognition by founders of SMEs at the initial start phrase of their business venture in the area of Ho Chi Minh City In terms of academic, this paper seeks to explore and contribute a throughout the process of entrepreneurial opportunity recognition by SMEs In term of practical application, this paper shows what SMEs need to have in hands and how potential entrepreneurs can recognize opportunities that can turn into a profitable business by raising deeper knowledge about determinants to opportunity recognition and its related process Literature review Entrepreneurial opportunity and opportunity-related process For many years, researchers have been disputing what genuinely institutes an entrepreneurial opportunity They brought about a broad category of different notions, sometimes ambiguous or even conflicting, which 655 gives rise to a substantial extent of variety in prospects (McMullen, Plummer, & Acs, 2007) For instance, entrepreneurial opportunity has been identified as an idea (Davidsson, Hunter, & Klofsten, 2006), as an unexploited project (Casson & Wadeson, 2007), or a potential venture or business form (DeTienne & Chandler, 2007), or a realistic endeavor (DeCarolis & Saparito, 2006; Mueller, 2007) The business opportunity is considered as an objective occurrence which is outward to SMEs and derives from the extraneous environment (Shane, 2003) In contrast, some defines opportunity as a subjective happening inseparably connect with and spring from the individual’s own perception and activities (Edelman, & Yli-Renko, 2010; Sarason, Dean, & Dillard, 2006) And other scholars have suggested an argument that business world offers multitudinous types of opportunity (Alvarez & Barney, 2007; Sarasvathy, Dew, Velamuri, & Venkataraman, 2003) Additionally, opportunity recognition calls for not only the opportunity itself but also the discovering process operated by the related person While some have expressed opportunity is a sequel of fortuitous findings (Long & McMullan, 1984), others have said that the opportunityrelated process would come clear (Bhave, 1994; de Koning, 1999), after a meticulous searching effort (Fiet, Piskounov, & Patel, 2005) In the same vein, Baumol (1993) says that in order to discover entrepreneurial opportunity, a process to detect new means-ends relationships must be set up by a given change That also means entrepreneurs have to analyze and brainstorm (Gaglio & Katz, 2001), like a cognitive process (Baron, 2004) Besides, the process which leads one to opportunity has been identically considered as a process which one generates creativity (Ardichvili, Cardozo, & Ray, 2003; Dimov, 2007; Hansen & Hills, 2004), or as an extraordinary action to solve a particular problem (Harper, 2008) For instance, some operationalize business opportunity as a recently novel idea subject (DeTienne & Chandler, 2007), while the rest operationalize it as the demand from the market for a product or service that have potential to solve a particular problem (Eckhardt & Ciuchta, 2006) In some circumstances, certain entrepreneurs possess the competence to sense and spot or even create opportunities (DeTienne & Chandler, 2007; Kolvereid & Isaksen, 2006) Or some others have an innate trait like alertness, a special individual competency to detect opportunistic situations (Busenitz, 1996; Ozgen & Baron, 2007) Determinants affecting the entrepreneurial opportunity recognition With the objective to recognize opportunity and start a venture formation, SMEs must proactively involve in entrepreneurial activities from scratch Founders of SMEs are likely perceived as entrepreneurs in the process of pursuing new business and profit which will lead to enterprise formation (DeTienne & Chandler, 2007; Gilmore, 2011) Approaching from the behavioral aspect of entrepreneurs, entrepreneurial opportunity search includes knowledge, alertness, intuition, creativity and social interaction By searching the pattern of adopted activities of owners, the process evolves into opportunity recognition Since the more turbulent and complicated the marketplace is, the more opportunities entrepreneurs are granted; entrepreneurial opportunity recognition may also come into existence from a complex series of phenomena with different distinct parts such as innovative insight, idea exploration, informal evaluation and concept development (Webb, Ireland, Hitt, Kistruck, & Tihanyi, 2011) Or through the argument by Ardichvili, Cardozo, and Ray (2003), entrepreneurs undergo a process from observing underemployed resource or market need to disclosing a ‘match’ between specific market need and certain resources; then formulating a fresh ‘match’ between the need and resources in the specific context of their businesses And the main determinants influencing the above processes as well as contributors to entrepreneurial opportunity recognition that are in need of further exploration include prior knowledge, entrepreneurial alertness, market analysis, creativity, network ties and situational elements Prior knowledge Knowledge plays an indispensable role to reach any sound and substantial decision-making as well as to spot business opportunities Shane (2000) claims that because of prior knowledge, owners can perceive the 656 value of new information, which leads them to the recognition of new opportunity Venkataraman (1997) also declares that entrepreneurs recognize opportunities which are concordant with information that they have already possessed Since information is developed through singular life experiences, everyone owns different stocks of knowledge and information It is believed that distinctive pack of prior knowledge can form a “knowledge corridor,” which enables one to spot some certain opportunities instead of the rest (Venkataraman 1997) Shane (2000) claims that there are three main aspects of prior knowledge which are customer problems, principles of the markets, and the means to benefit from the markets In another way of classification, two types of prior knowledge are postulated by Sigrist (1999) The first is knowledge in a field of entrepreneurs’ special interest so that they will spend a tremendous amount of time and effort learning, which helps advance and deepen their abilities, thereby gain esoteric knowledge in that specified field The other type of knowledge, which is a result of rational choice, will be accumulated over the years, while owners constantly work in a certain job Whether derived from education or working experience or by fluke and any other ways, prior information makes a huge difference in the ability of entrepreneurs to obtain, interpret and make the most of new information in the way which those in short of that prior information cannot duplicate (Roberts, 1991) Based on Austrian economists, the key to open, the entrepreneurial opportunity is within the combination of knowledge and alertness (Murphy, 2011; Vaghely & Julien, 2010) As mentioned, when and where disequilibrium between market needs and the means to satisfy those needs arises, opportunities are just around the corner For such reason, the Austrian believes that alert individuals can gain new opportunities when their knowledge about market needs to be aligned with knowledge about the means to meet those needs (Kirzner, 1997; Shane, 2000) However, even though numerous empirical evidence embodies that prior experience have a substantial influence on the process of opportunity recognition and development, some entrepreneurs still successfully sense and go after opportunities that they possess no related prior experience before (Cooper, 1990) Entrepreneurial alertness Kirzner (1979, 1985), who is the first one to present the term ‘alertness’ into the entrepreneurship literature, describes it as “the ability to notice, without search, opportunities that have been hitherto overlooked” or as “a motivated propensity of man to formulate an image of the future.” It is implied in the first interpretation that one can spot opportunities even when the person doesn’t intentionally seek for those In fact, when individuals possess high alertness, they may experience “passive search,” a condition in which they are sensible of opportunities, without conducting any formal, systematic search On the other hand, the second interpretation means ability to “connect the dots” that empowers one to notice the nexus among the changes or turbulence in the marketplace and to perceive those as significant, regardless the fact that the cause and effect of opportunity at the moment are not evident yet (Leff Bonney, & Williams, 2009) Therefore, the comprehensive dimension of alertness can be determined as the capacity of entrepreneurs to generate a holistic depiction of the surrounding marketplace by assembling all of its constituents and knowing their meanings (Endsley, 1995) In fact, entrepreneurial opportunities may be recognized and captured by some particular individuals instead of the rest These dissimilarities result from the heterogeneity in people’s sensitiveness to opportunities to create as well as to deliver new solutions (Ardichvili, Cardozo, & Ray, 2003), which origins from differences in people’s innate ability, background and experience, and also the amount and sort of information they own in a specific scope aligned with the opportunity Endsley (1995) asserts that some individuals are so sensible of market gaps or problems that in any environment they find themselves, they can constantly identify possibilities of creating new products or services Besides that, Gaglio and Kats (2001) also contribute to 657 entrepreneurship literature that alert individuals possess a greater deal of knowledge and information within the marketplace than non-alert individuals who may neglect or disregard fluctuations within the marketplace Market analysis Actively searching for information is broadly acknowledged as a vital step during the process of entrepreneurial opportunity recognition Nevertheless, lately, many scholars have debated if entrepreneurs seek for opportunities and how the process of value recognition due to the incoming of new information happens to them (Ardichvili, Cardozo, & Ray, 2003) Kirzner (1997) disclaims that “What differentiates discovery (related to hitherto unknown profitable opportunities) from successful search (related to the intentional generation of information which one knew one had fallen short of previously) is that the former includes the unexpected that accompanies along the manifestation that one had omitted something in fact readily available from the beginning.” Koller (1988) also affirms that most entrepreneurs “recognize,” rather than “look for” opportunities of their enterprises Still, the possession of being marketdriven or a marketing orientation is believed to be crucial to business success (Hult, Ketchen, & Slater, 2005) SMEs which intensely depend on the professional expertise and experiential knowledge of the founders, along with a limited operational budget, have to be flexible to adopt suitable tradition marketing procedure which is logical and well thought out, but not entail immense funding (Hulbert, Gilmore, & Carson, 2015) From marketing literature, founders of SMEs can take advantage of some tools such as PEST analysis (Fifield, 1992), situation analysis, SWOT analysis (Ansoff, 1969), marketing audit, Ansoff’s (1975) product-market matrix, Porter’s (1979) five forces model… Cravens and Piercy (2003) perceive the benefit of such evaluation tools is to clarify opportunities and gap in performance as well as to commence activities to capitalize on those opportunities Despite the confinement by impact and size, limited resources, and expertise, founders of SMEs can still manage to run their business, make sound decisions and present their market offerings to the marketplace by less formal, but more intuitive and predictive strategic planning processes (Gilmore & Carson, 2007) Network ties Networking is an essential business aspect, especially when SMEs have to operate along the resource constraints and impediments (Deakins, 1991; Gilmore, Carson & Grant, 2001) Hills, Lumpkin, and Singh (1997) also say that the network ties of entrepreneurs are momentous to opportunity recognition In reality, networking activities revolve around the way that entrepreneurs operate their businesses, which refers that it can be spontaneous, casual and opportunistic (Gilmore, 2011) Consequently, the network can also be haphazard and disjointed, including bilateral or multilateral connections among different individuals in some specific situations Based on Granovetter’s argument (1977), network consists of both strong and weak ties Weak ties, which comprise easygoing acquaintances, are more likely to yield distinctive knowledge and ideas than close friends since most people tend to possess more weak ties than strong ones in their lives Chetty and Holm (2000) express that entrepreneurs who have broad network can improve their chances to encounter various opportunities, receive new information, learn from other ones’ experiences, and gain values from the reciprocal effect of knowledge and resource current Moreover, social and business networks expand the horizon of SME owner-managers, offering the means of approaching to new and different kinds of information that would otherwise be faced (Wilkinson & Young, 2005) They not only support the access and co-function of different resources for further development and exploitation on entrepreneurial opportunities but also help back up on risks management as well as the uncertainties involved (Wilkinson & Young, 2005) Furthermore, maintaining interactions with individuals in social network and looking for information exterior the close social group will also bring about creative or unconventional idea formation (PerrySmith, 2006) 658 Creativity Creativity has been seen as a central organizational competency and a ground-breaking factor to future business success, especially within SMEs (Palus & Horth, 2002; Bridge, O’neill & Cromie, 2003) Amabile (1997) explains entrepreneurial creativity as “the construction and implementation of novel, yet appropriate ideas to set up a new venture.” Individual creativity within a business pays a tremendous contribution to organizational innovation as well as a general competitive advantage (Hirst, Van Knippenberg & Zhou, 2009) Creativity involves one’s sensitiveness to the environmental change, inducing promotion of a high or low frequency of creative effort However, for many instances, entrepreneurs have a tendency to get higher score results in different creativity tests than other individuals Schumpeter (1934) is the first scholar to put forward the argument that because of creativity, entrepreneurs can benefit from the opportunities that the rest cannot In reality, creativity is best obtained while one is in the flexible and non-predetermined state (Amabile, 1983) Meanwhile, Fillis and Rentschler (2006) claim that creative solutions not have to be complicated since relatively primary responses are capable of leading to the business success Timmons (1994) adopts a viewpoint that raising a good idea is the initial step in the process of turning an entrepreneurial opportunity into an actual business Moreover, founders of SMEs are believed to display either an innovative or adaptive style of creativity (Filipczak, 1997) Innovative creativity refers to activities of inventing new and different ideas, while creativity relates to the modification of existing ideas and concepts Besides that, an appropriate environment or climate can facilitate and flourish entrepreneurial creativity from interactions between the situation and the individual (Lee, Florida & Acs, 2004; Hunter, Bedell & Mumford, 2007) Situational elements In many cases, the situation that entrepreneurs involve around can be the game-changing factor leading the whole process of opportunity recognition Hulbert, Gilmore, and Carson (2015) say these external factors include serendipity or luck when things happen at the right moment or the right place, which is favorable towards entrepreneurs Getzels and Jackson (1962) suggest the differentiation between entrepreneurial opportunities can be clarified by the origins and developing level Various sources for new opportunities emerge when there is an understanding of the market, along with the business climate in which that market functions To be more specific, sources of business opportunity can directly or indirectly derive from crisis or fluctuation in the macroenvironments such as society, politics, economics or technological revolution and so forth or from the dynamic changes within the market that SMEs operate in (Hulbert, Gilmore, & Carson, 2015) Methodology Exploratory qualitative research is adopted to fully discover the determinants affecting the entrepreneurial opportunity recognition process by founders of SMEs and the inter-relationships among those determinants The benefit of using a qualitative approach is from its capability to seize the most of the meaning and nature of opportunity recognition process from ways of looking by the research participants instead of an assessment about the frequency of events or responses This approach will accommodate a framework which is driven by the research participants and allow researchers to explore the complexities and the depth of phenomena and providing valuable and insightful material regarding the recognition of entrepreneurial opportunity (Bamberger, 2000; Bryant, 2006) Besides that, such type of study is implicitly correct to induce credible causal explanation for further extending managerial practice (Maxwell, 2005) The method used for collecting primary data is a semi-structured in-depth interview This type of method is considered to be one of the best ways to explore an individual’s behavior and attitude (Tull & Hawkins, 1990) A sample of 16 respondents who are founders of SMEs is gathered primarily based on the definition 05 they all provided helpful information and different viewpoints challenging my stances and critical thinking’ Entrepreneur alertness – low importance – Founder used his own knowledge and experience along with the process of observing and evaluating the industry to detect his business opportunity Safety labor training and Prior knowledge – high importance – ‘All knowledge that I inspection learned from university and experience I collected from Age of company: previous works hugely contributed to the process of years Experience/qualificatio of opportunity recognition in terms of technique’ ns founder(s): Market analysis – high importance – ‘Every or years, the Bachelo in Mechanical government will revise and adjust law for inspection, so r we Engineering Bee in the need to build and make adjustments for our business n strategy inspection and safety annually At the beginning, we hired a specialized marketing training industry for 10 agency to build our brand… We also classified our categories years Used to hold of customers to offer suitable services… We positions conducted such Head of Pressure, as 668 Head of Laboratory for some state-owned enterprises and a trainer for the Department of Labor Safety 06 Interior and graphic design Age of company: years Experience/qualifications of founder(s) : Director: Bachelor in Interior Design in this Working industry for almost 10 years Started career by working for some desig and n construction consulting evaluation on our competitors in terms of technical skills and team of sellers’ Network ties – high importance – ‘There are members in board of directors We have different strengths, which helps complement one another… And I consider everyone within my network as a seller, whom can help expand the company reputation and maybe income…’ Besides that, owner admitted that inspectors from government had certain support for his company Entrepreneur alertness – low importance – ‘We have to study and carefully analyze our market frequently There is no way to instinctively run a business in this industry’ Prior knowledge – high importance – Owner has passion for design, aesthetics and perceives opportunity as “something attached to one’s forte and vocation” She also claimed that her graphic design skill and aesthetic creativity was from the time she spent in university, plus experience during her previous works Market analysis – high importance – ‘After research, one will be well-equipped with information in a specific field, they will be more knowledgeable and see things that outsiders cannot We identified our market segment The most profitable projects were space-based commercial businesses such as restaurants companies, then busted and coffee shops My husband was in charge of out market being a lecturer at research by using Google analysis tools, building Saigon strategies and Technolog Universit and professional promotion for the company Thanks to his y y effort, working I knew we could expand our market to the North’ freelance Co(husband): Network ties – high importance – ‘Current design founder employees Bachelor in Business are friends and colleagues who have been together before the Information Technology company was established… My husband manages online Responsible for online marketing, which helps find 70% of total client number’ marketing of the company Entrepreneur alertness – low importance – Founder did not see any specific trends or expect to open her own business While offered a lot of projects, founder felt “positive” about 11 Construction design and consultancy Age of company: years Experience/qualifications of founder(s) : Bachelor in Civil and Industrial Construction Working in the industry for more than 17 years Started as construction engineer, the became manag and n er vic director for some e corporations about construction and real estate her work and decided to form a business so that her coworkers and employees could get well-deserved benefits from the company Prior knowledge – high importance – ‘To me, knowledge is 30% of what I got from school and 70% left is from experiences I gained from years working in construction corporations before establishing my own company… My prior knowledge served as fundamental base for me to consider something as entrepreneurial opportunity’ Market analysis – high importance – Founder used his experience working for big corporations before to conduct a formal marketing plan to identify appropriate business opportunity Network ties – high importance – Founder considered network was the determinant factor in the construction industry as ‘No one will trust you and hand you a project unless they have already known you; or their close acquaintances know you’ Entrepreneur alertness – low importance – ‘I planned to be employee for a couple years to gain experience and build network then busted out and started off my own company because I wanted to be my own boss That’s it!’ 669 14 Solar energ y supplier equipment Prior knowledge – high importance – ‘As a businessman, my husband has knowledge about sale and product marketing, Age of company: 14 years while I take care of technical aspects, update information and Experience/qualifications comprehend the system and specification of the of products’ founder(s): Market analysis – high importance – ‘Even though we didn’t Director: Master in conduct anything professionally, but we did identify Industrial our Electrical Engineering competitors to evaluate their offerings When After bidding, we graduate, became a studied our potential partners in terms of the relevant lecturer projects for Can Tho University; and their specific demands We also participated in then some worked for a technical fairs and made report programmes associated representative with office of a Taiwan television station to promote our brand as well as the company trend of about solar water heater using solar water heater’ for years Been having nearly Network ties – high importance – ‘I am lucky to have my 20 years of experience in husband as my business partner since day one He this is an industry excellent salesman and great teacher for the sales staffs…We Co-founder (husband): discuss every project or problem and seek out the best solutions Bachelor in Business for the company Because of him, I could run this business’ Administration to be Entrepreneur alertness – high importance – Founder did Used not business developmen plan to establish any business ‘We did not see this as t an directo for some opportunity from the scratch We carried some r suppliers unfinished about constructio and contracts from the previous workplace and we decided n to finish refrigeration what we were doing Then new projects kept coming, so materials we continued with what we thought we were good at the moment’ Table – All four elements prior knowledge, entrepreneurial alertness, market analysis and network ties are of high importance Firm 09 Background of business Software development Age of company: years Experience/qualifications of founder(s ): Director: Worked for Findings Prior knowledge – high importance – ‘I used to be an assistant for the CEO of a technology company, so I understand how to operate a technology company Besides that, I have knowledge about Vietnamese cultural and market My husband is a Finnish businessman with more than 20 years of experience He technolog information y companies as an assistant of CEO Having 7-year experienc in technology e industry Responsibl for e daily management and operation of the firm Co(husband): founder Career in technical solution consultancy and programming Used be to programming security directo of Nokia Finland r Having more than 20year experienc Legal e representativ of another e programming business , Nodeon Vietnam In charge of technical aspect and is responsible for technical support and has a hope to bring advanced technology from Europe to Vietnam’ Entrepreneur alertness – high importance – ‘Being alert to opportunity is very important while doing business We saw the shortcomings SMEs had and realized they needed a system that could help them manage their business better Many SMEs still manage their company by excel or books Meanwhile, today's modern technologies can help them reduce bookkeeping and costs, simplify and optimize management process’ Market analysis – high importance – ‘Initially we went to survey and evaluated the market to find out specific needs of SMEs and whether they were ready to accept technology to create the most appropriate line of products and services… We used SWOT, product and service life cycle analysis, and outline a 1-year and 3-year term strategies for the company’ Network ties – high importance – ‘Since we felt confident with 20-year experience as well as prestige of my husband, we were more willing to take the risk and choose startup’ 670 13 15 somewh operatio of the at n firm Software and Prior knowledge – high importance – ‘All my experience telecommunicatio collected daily through work, through failures The ns most equipment important thing is that all accumulated experience could supplier enable Age of company: me to determine whether I should exactly develop years one Experience/qualificatio of opportunity or not’ ns founder(s): Entrepreneur alertness – high importance – ‘Business Working in the industry for opportunity is when there is a juncture to easily dominate the 20 years Bachelor in market and get benefit from it I saw the scarce in IT services Compute Scienc and as well as IT products And the potential development r e was very Engineering After high, so it was right to start off a company specialized in graduate, these worked for some services’ internation technology Market analysis – high importance – Founder al emphasized that corporation with highest it was important to update information on technology s regularly position as and find opportunities through market research director activities since those helped define the demand of customers to meet Network ties – high importance – Founder believes that ‘more heads are better than one’ and ‘ learn from the experiences of others and himself, but always filter opinions and advice to take the suitable ones’ BTL Marketing agency Prior knowledge – high importance – ‘In this industry, you have Age of company: to be clever in the way of behaving and understanding years your Experience/qualificatio of customers, and how you can anticipate their ns expectations and founder(s): thoughts And all of that I learned in 13 years by doing the best Bachelor in International of every project assigned’ Relations Had 13 years Entrepreneur alertness – high importance – ‘Opportunity of is at experien in industry the very moment that everything falls into place… The ce the last Stared working from junior project I did at previous workplace was to help Honda launch year at Cattiensa Media a new sport racing car with the top technology, holograms The Group After graduate, client was so satisfied with my work, so I realized that I could worked for one marketing more… There was also a high demand of marketing services agency only in years from agencies So I knew that was an opportunity to before challenge open his own business myself more and explore my potential’ The highest ever held position was account director, under manageme of general nt director only 16 Freight delivery Age of company: years Market analysis – high importance – ‘I evaluated my “unique selling points” (competitive advantages), analyzed the market, the tastes of clients as well as my capacity to meet their requirements I set out a strategy that the first year is for branding, building appropriate service packages and a core team After years of operation, I have had a certain amount of clients, so now I plan to build up human resource After years, the company will probably grow and expand into specialized service branches’ Network ties – high importance – ‘By having certain relationships with a number of big clients as well as partners associated with my previous work, I could maintain the business at the beginning… To survive in BTL marketing, you need to know how to connect many things together When you create an event for client, you know all the links and where to contact to hold that event successfully So always think of how to expand your business network in this industry’ Prior knowledge – high importance – ‘I have had more than 10 years of experience learning by doing in this industry… Yes, the 671 Experience/qualifications of founder(s) : Bachelor in Education Psychology However could not find a job related to his study Started to work for some logistic corporations as an administrative staff, then became manager, and finally got promoted as an area director of outlets in Central Vietnam Been in the same industry for the best part of 20 years knowledge I acquired at university, which is a completely different field, served like a foundation to my logical thought and action’ Entrepreneur alertness – high importance – Founder referred a businessman as a person who has ability to detect problems around and gain profits by providing sound solutions for such problem And he said ‘Opportunity in logistics is numerous’ Market analysis – high importance – ‘You need to understand your market, your position in the market and the gap between what you want to achieve and your resources at the time… My services are specialized to served groups of customers only (target segments): healthcare, baking and education… I am confident that even large corporations cannot compete with my services for these customer groups’ Network ties – high importance – Founder expressed that longterm customers who confided on his competency in this field from former workplaces helped him maintain a certain source of initial income at the start Table – Entrepreneurial alertness, market analysis and network ties are of high importance; prior knowledge is of low importance Firm Background of business 04 Takecoffee away distributio n Age of company: years Experience/qualifications of founder(s) : Bachelor in Business Findings Entrepreneur alertness – high importance – ‘I recognized the need for clean coffee from myself first, and I observed that people around me were in the same situation’ Market analysis – high importance – ‘I planned shortterm and long-term strategies In the first 3-5 years, the company will operate along the criterion of “a survival” In the next 510 Administration Working in years, the company gets into orbit After 10 years, I will rapidly construction industry expand the scale of outlets and maybe become a franchiser…’ approximately 10 years Besides that, he emphasized ‘You have to be aware of and your running another business strengths and limitations, know your main competitors in and the field of construction main customers’ , Oceancon Network ties – high importance – ‘Mentors from my CEO s courses and my best friend who is co-founder of Oceancons gave me incredibly valuable advice and opinions about my business model and strategy… Even this is an entirely different industry, but the principles to run a business are likely similar to one another So it is always a good choice to listen to other viewpoints to expand your knowing’ Prior knowledge – low importance – Founder spent career working in an entirely different business before entering into the coffee industry ‘Before running this business, I had never experienced any work or studied any courses related to coffee’ 672 Table – Adaptive style of creativity Firm Source of opportunity Analysis 01 Dynamic marketplace – Change in customer needs and tastes: Vietnamese people started using organic and healthcare products Founder created bottle of Lingzhi drinking tea, which is more convenient and affordable than pure Lingzhi mushroom and its sporangium This SME also offered Lingzhi gift boxes customized as customer requirements 02 Dynamic marketplace – Gap (unmet need): At the time, the South had very scarce number of termite and pest control services Founder was the first generation to run a termite and pest control services in the South He applied what he knew about pesticides from previous works in Hanoi to educate Southern people and solve their problem Founder used adaptive creativity due to different area climates and different behaviors of termite 03 Environment change – Technology This SME provided a wide range of al international revolution and technology solutions from software to development hardware and cloud computing, but modified them to suit different management systems of the users 05 Environmental change – Change in After privatized, this field offered plenty politics: Vietnam government issued opportunities and also became more new competitive law which privatized the safety The firm had to adjust the offering services labor and be training and inspection in 2008 creative in way of finding new sources of customers to compete against state-own enterprise as well as other private enterprises 07 Dynamic marketplace – Fluctuation in real estate industry towards positive direction Founder saw the absence of promotion activities for a profitable market like real estate, so he grasped the opportunity by providing specialized marketing services for this industry and adapted to the need within the market 10 Dynamic marketplace – Gap (unmet need between expectatio ) customers’ n and what Vietnames restaurant e s Founder managed to provide meals from hygienic food sources along with friendly customer services and cozy ambience provided 11 Environmental change – Change in This company had capability to cover a whole economy: Enterprises received project throughout from construction consulting to monumental FDI for construction designing and implementing with a and guarantee ‘on real estate after Vietnam became time and in budget’ to its customers a member of WTO in 2007 673 12 Environmental change – Changing in politics and economy: The government amended the Law on Environment Protection in 2005 This company did researches on each plant power system then modified and applied the appropriate waste-water technology and treatment 13 Environment change – al revolution and development This company provided equipment and different service packages related to computer maintenance at house of users Founder claimed that his company had the most affordable offerings for customers 14 Dynamic marketplac – Dynamic e marketplace – Potential growth in demand for solar water heater 15 Dynamic marketplace – Growth in This company modified and synthesized single demand of outsourcing marketing service packages into an entire BTL marketing services project for its clients 16 Dynamic marketplace – Change in supply chain Technolog y This company provided customized solar systems for different types of projects from households to restaurants, hotels, factories and constructions… The founder developed his business into 3PL logistics services provider and specialized the services for customer groups including banking, healthcare and education only Table – Innovative style of creativity Firm Source of opportunity Analysis 04 Dynamic marketplace – Gap (unmet need): The market was in shortage of clean coffee, while the demand of coffee drinkers in Vietnam was very high This firm was among the first pioneers to apply the take-away coffee model with unflavored coffee products Founder also invented and used his own mobile coffee barrels by plastic to carry coffee and ingredients 06 Environmental change – Change in This company was one of the few companies which economy Numerous F&B businesse could provide a complete service package : s from opened and flourished such as branding to design and marketing based coffee on shops, milk-tea and small distinctive requests from each creative restaurants… project for each F&B customer 08 Environmental change – Change in The tourism industry was quiet a new market and politics and economy: The people did not really regard how they government should promulgated Law of Enterprise, travel This was the first travel agency to which create private enterprises were legalized in various travel packages such as team1991 building and tourism started to develop 674 tours and caravan tours based on criterion ‘happy and unique’ of the founder 09 Environmental change – Technology revolution and development This company provided tailor-made ERP systems for different sorts of business They also invented a management program called Hurapos for retailers 675 ... experiences, and gain values from the reciprocal effect of knowledge and resource current Moreover, social and business networks expand the horizon of SME owner-managers, offering the means of approaching... participants and allow researchers to explore the complexities and the depth of phenomena and providing valuable and insightful material regarding the recognition of entrepreneurial opportunity. .. alertness and network ties are of high importance; market analysis is of low importance Six cases illustrated the application and significance of prior knowledge, entrepreneurial alertness, and network