This chapter discusses new entry opportunities and strategies for exploiting them. It covers 3 key stages: 1) generating new entry opportunities, 2) exploiting entry opportunities, and 3) feedback between generation and exploitation. When generating opportunities, resources must be valuable, rare, and inimitable. Entrepreneurs assess opportunities by determining if the product/market are attractive enough based on prior knowledge and the window of opportunity. The decision to exploit an opportunity depends on having sufficient information and comfort with uncertainty given the window may close.

1. Chapter-3

2. Chapter Highlights
New entry, generation of new entry opportunity
Entry strategy for new entry exploitation
Risk reduction strategy for new entry exploitation

3. New Entry

4. New Entry
An entrepreneurial strategy has three Key Stages
A. Generation of a new entry opportunity
B. The exploitation of entry opportunity
C. A feedback loop from the new entry generation and exploitation

5. 1. Resource as a source of competitive advantages
2. Creating a resource bundle that is valuable, rare inimitable
3. Assessing the Attractiveness of a New Entry Opportunity
A. Generation of a New Entry Opportunity

6. 1. Resource as a source of competitive advantages: Resource are
the basis building blocks to a firm’s functioning and
performance. A firm’s resource simply the inputs into the
production process, such as machinery, capital and skilled
employees.
Resources must be:
I. Valuable: enables a firm to pursue opportunities, neutralize
threats, and offer valuable product and services to the customers.
II. Rare: Possessed by few, (potential) competitors.
III.Inimitable: Replication of this bundle of resources would
difficult or costly for the potential competitors.
A. Generation of a New Entry Opportunity

7. A. Generation of a New Entry Opportunity
2. Creating a resource bundle that is valuable, rare inimitable
Entrepreneurs combines the resources into such a different ways as
this bundle of resources provides a firm its capacity to achieve
superior performance
For Example: A high skilled workforce will be useless if the
organization’s culture, teamwork, communication does not support
them.
Knowledge and experiences are the basis of entrepreneurial resources.
It is because those wising to generate an innovation need to look to
the unique experience and knowledge within themselves and their
team.

8. A. Generation of a New Entry Opportunity
Knowledge is particularly relevant to the generation of new entries
and that is related to the market and technology.
Market Knowledge: Possession of Information, technology,
know-how, and skills that provide insight into a market and its
customers.
Technological Knowledge: Possession of information,
technology, know-how and skills that provide insight into ways
to create new knowledge

9. 3. Assessing the Attractiveness of a New Entry Opportunity
 The entrepreneur needs to determine whether it is in fact valuable, rare, and
inimitable by assessing whether the new product or the new market are
sufficiently attractive to be worth exploiting and developing.
Information on a New Entry: The prior market and technological knowledge
used to create the potential new entry can also be of benefit in assessing the
attractiveness of a particular opportunity.
Window of Opportunity: The period of time when the environment is favorable
for entrepreneurs to exploit a particular new entry. An example of window of
opportunity closing is when another entrepreneur has entered the industry and
erected substantial barrier. Likewise, government policy changes in the favor of
entrepreneurs may also be defined as the window of opportunity. This, the
viability of the new entry can be described as the window of opportunity.
A. Generation of a New Entry Opportunity

10. Comfort with making a decision under uncertainty
 The trade-off between more information and the likelihood that the window of
opportunity will close provides a dilemma for entrepreneurs. Here entrepreneurs
usually commits two types of errors.
Error of Commission occurs from the decision to pursue this new entry
opportunity, only to find out later that the entrepreneur had over estimated
his/her ability to create customer demand and/or to protect the technology from
imitation by competitors.(negative outcome from acting on the perceived
opportunity)
Error of Omission occurs from the decision not to act on the new entry
opportunity only to find out later that the entrepreneur had underestimated
his/her ability to create customer and/or protect the technology from imitation by
competitors.(negative outcome from not acting on the perceived opportunity)
A. Generation of a New Entry Opportunity

11. Decision to Exploit or Not to Exploit the New Entry
It depends on whether the entrepreneurs has what she or he believes
to be sufficient information to make a decision, and whether the
window is still open for this new entry opportunity. A determination
by an entrepreneurs that he or has sufficient information depends
On the stock of information( accumulated from search and
prior knowledge)
The level of comfort that this entrepreneur has with making
the decision without perfect decision(which depends on a
preference of one type of error over another)

12. Decision to Exploit or Not to Exploit the New Entry