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Evaluating Ideas And Opportunities

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What is evaluating ideas and opportunities?
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What is evaluating ideas and opportunities?

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Definition of evaluating ideas and opportunities

This term relates to the process of determining which business ideas offer valuable opportunities and are worth pursuing. As such, evaluating ideas and opportunities gives entrepreneurs a better chance of achieving commercial success.

How do you evaluate ideas and opportunities

Evaluating your ideas and opportunities is relatively easy. In fact, it can be done in five easy steps:

Step 1: Establish key assumptions

Create a simple list of assumptions about your business, such as its goal, the problems it solves, who its target audience is, and why it’s a viable business.

Step 2: Speak to prospects

Interact with people in your target audience to validate your assumptions. Is your problem-solving idea really needed? What current options do they have to solve them already? Re-evaluate your concept to align with what you’ve learned.

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Step 3: Test a prototype

If possible, create a prototype to gauge prospects’ reactions. Then gather user feedback to inform future development.

Step 4: Identify your idea’s commercial value

Research competitors’ prices and ask prospects if they would be willing to pay your projected rate. Weigh the price with the cost of production to determine if the business idea is a viable opportunity or not.

Step 5: Release an MVP

Develop a minimum viable product (MVP) with only the essential features to gather hands-on feedback and identify growth opportunities.

General FAQ

What are some models for evaluating innovation ideas?
Companies can take advantage of several models for evaluating innovation ideas. One involves pairing two ideas and comparing them based on their respective potential benefits. From this, the team doing the comparison will decide which idea is the most preferable of the two. This process may be performed multiple times to rank possible ideas, making the final selection process easier. Another technique is to focus on the financials of ideas, such as the estimated costs of bringing a product to market against the projected revenue generated. A drawback of this model is that riskier ideas may be overlooked while safer ones gain priority — which isn’t always a great judge of an idea’s commercial value!
How can businesses benefit from evaluating ideas and opportunities?
Businesses can weigh ideas based on their relevance to their brand and customers alike. Just because an idea is innovative doesn’t necessarily mean it’s worth pursuing, especially if it fails to align with the company’s image, goals, and audience.

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