Part 7: Innovation and Entrepreneurship
60 | Knowledge Discovery
Markets and science advance society in fundamentally the same way. They enable the failure of theories and the hypotheses that drive those theories, thus advancing human knowledge.
61 | It Takes More than Ideas
It is not hard to find people who see how products could be better. We all do that. The entrepreneur is the one who acts on such ideas.
63 | Entry, Exit, and the Role of Profit
Short run thinking about cost treats fixed costs as already paid and unrecoverable (that is "sunk"). Long run thinking about cost assumes that no fixed costs have been decided or paid.
64 Creative Destruction
Disruptive innovators expose outdated methods of production. They create something new and in the process destroy the old.
66 | Entrepreneurship As a Process
Entrepreneurs tend not to be reckless. The risks they take are calculated. They want to make sure that they will be able to handle the downside, and they want to make sure that the likely upside is worth the risk. There is a method to how they behave.
67 | Creating Markets
Just as we argued that all value is co-created, we also argue that all markets are co-created. When the effectuation process works, the result is the creation of new firms and new markets.
68 | Competitive Advantage - The Dynamics of Remaining Viable
Competitive advantage among firms arises from both the relative resource or production cost and the relative appeal of value propositions. The dynamics of competitive advantage arise from firms attempting to gain advantage by acquiring and integrating resources at a lower cost.
69 | The Big Errors
As entrepreneurs strive to innovate, they tend to make three major errors.