In a nut-shell, customer-centric businesses tend to evolve through 'opportunity discovery', mostly through interactions and feedback gathered from customers.

Opportunity creation is more prominent in non-customer-oriented businesses/divisions (such as technology, research, product ideation etc.), where customers are not capable of providing any insights into what they want (mostly due to the limitation of their knowledge into what can be achieved through the said technologies, research outcomes etc.)

Most of the times, in real-world, it is usually a mix of these two.

Big-data, for example, is an opportunity creation for  startups, where as it is 'opportunity discovery' for companies with existing customer base. 

Thank you,

GK (Gopalakrishna)

http://gk.palem.in

Hi Upananda,

I am not sure whether the distinction between creation and discovery is true or not. It seems to be also a matter of how we research the issue, either by examining opportunity identification ex post (discovery) or following a process approach (often find discovery). See also the recent excellent article by Dimo Dimov on this issue or my recent review of the literature on this topic. See the links provided below.

best wishes,

Elco

http://onlinelibrary.wiley.com/doi/10.1111/etap.12092/abstract

http://onlinelibrary.wiley.com/doi/10.1111/joms.12049/abstract

To the best of my knowledge those businesses that have created vast markets which did not exist before and enjoy great revenues from those markets, can be categorized as "Created Opportunities", for example Computer Gaming, Mobile Phones (their first generations) were totally created on the basis of imagination and creation because there were no such markets before. They made the demand and at the same time answered it. I also believe that those businesses that are handling old and known needs by establishing technologically improved firms, adjusting new relations and molding new behaviors (according to their corresponding praxeology) can be called "Opportunity Discoverers".

What a great question! I have found all of the replies to be substantial and thought-provoking. As a former small business creator of over 15 years my entrepreneurial journey began as a simultaneous discovery and creation process. I think that we are conditioned from childhood to think linearly and so we feel very comfortable with a sequential way of thinking; however, sometimes the situation is not so straightforward, as the "which comes first, the chicken or the egg" question reminds us. True entrepreneurs are always thinking in terms of opportunity and perhaps the lines get blurred in identifying whether or or the opportunity was created or discovered  - until upon later reflection when cognitively we sort it all our, I suppose. Perhaps discovery and creation might have a symbiotic relationship?

Dear respondents,

 Thanks for your time and consideration for attempting to answer the question.

Even though all responses contributed to get new insights to the problem, Ruth's experience may give better understanding about the  the problem. However, I argue that the influence of context is far greater than any other factor which lead one to identify an entrepreneurial opportunity.

For example, take entrepreneurs in the Silicon Valley and Ithaca in the USA. Entrepreneurs in Silicon valley are discovering majority of opportunities rather than creation. Because these entrepreneurs know probability of outcome and invest accordingly.  Entrepreneurs in Ithaca, New York, 450 km from the Capital, are creating opportunities with variation of diversity of Cornell Student populations.  those opportunities are poor in wealth creating ability.

Upananda

in

The full cycle from ideation to implementation, which typically  includes opportunity exploration, idea generation,  idea championing, and idea application, while appearing a linear one , is actually very iterative;  with every iteration dynamically building the capabilities of the entrepreneur.  Hence seemingly pure creations draw influences from external discovery and similarly what may appears to be pure discovery, is influenced by a pre-disposition based on the entrepreneur's accumulated capabilities.

This is a question I have been grappling with recently in study of immigrant entrepreneurship in South Africa. I have my own reservations regarding the discovery view. It seems to suggest that opportunities are there waiting to be discovered by whoever gets there first, much like Christopher Columbus "discovered" America. Some scholars actually argue that this in keeping with the critical realist ontology that says reality exists out there irrespective of our knowledge of it. I think that's a very narrow interpretation of critical realism. My own view is that if opportunities were discovered, why then is it that immigrants "discover" them ahead of indigenous communities, a fact borne out studies that reveal the immigrants are more entrepreneurial? Would one not expect the local communities to discover the opportunities first as they are to be found in their midst?

I tend to go with the creation view which actually demands more from an entrepreneur than mere discovery. This is perhaps more active than discovery and requires certain attributes which then, in my view. separates the entrepreneur from the non-entrepreneur. Perhaps the locals 'see" but do not perceive the opportunities. They see open spaces where immigrants see trading spaces and actually exploit them. As an immigrant and entrepreneur myself, I suppose my personal experiences may affect how I look at things.

I welcome other views too.

Dear All,

Thanks for contribution to address the question.

My view is that discovery and creation are the views of scholars who attempt to differentiate the differences  business entries.

Discovery is not something like that Columbus did. Opportunities are not present in objectively until an agent link opportunity brings to reality.   But Columbus was alerted to discover land/country for exploitation. alertness important for discovery (Shane, 2003).  Creation is mainly cognitive. Think rethinks, and compare advantages and disadvantages.  while this cognitive process is taking place, new entrants are implenting his creation.  then he starts with new entry. the  process is going on until creation of business (business entry).

No research evidence to state which is better or more novel.  Even though creation seems to be more novel, it cannot be so when discovery and creation processes are combined. I believe it is more like empirical cycle of sciences.

However, the novelty or innovativeness is relative. Nothing in the world can  be taken as absolute. Every moment, everything thin changes. However people reluctant to believe the truth even he knows the reality.  

Upananda

If one is a critical realist, then perhaps discovery of opportunities makes more sense. For a critical realist, reality exist exists out there independent of our knowledge of it. If a tree falls in the Amazon and no one sees it or hears it falling, has the tree fallen? From that perspective therefore, opportunities are there, waiting to be discovered.

My own view though is that entrepreneurs do a bit of both discovery and creation of opportunities. Discovery of opportunities though, requires less from the entrepreneur than creation. I agree that creation is a cognitive process. One could argue that the "discovery" of diamonds in Kimberly in South Africa in the late 19th century, which sparked the development of the country, is a case in point. Did the opportunity exist before then or was it created? If it did, why was it not taken prior to then? The opportunity was not the diamonds, which were there for ages before. The opportunity was probably the mining of the gems and what to do with them. This was a process of creation.

If an opportunity exists but is not exploited, does it actually exist? From a critical realist perspective I would say indeed it exist. As to which is better, I am unfortunately not able to comment. Does it really matter actually, whether the opportunity is discovered or created? It only matters in so far as it may help why some people and not others are entrepreneurs. Certain attributes are required for discovery and different others for creation, I suppose.

In terms of using Critical Realism to save "discovery" I am quite critical for both practical and meta-theoretical reasons. Those interested can read a short dialogue piece (responding to Ramouglu and Tsang) that is forthcoming in AMR: https://www.researchgate.net/publication/306315329_Opportunities_Time_and_Mechanisms_in_Entrepreneurship_On_the_Practical_Irrelevance_of_Propensities

Article Opportunities, Time, and Mechanisms in Entrepreneurship: On ...