Question

5. a) Discuss the difference between a business idea and a business model.

b) Explain why the Pyramid of Needs by Abraham Maslow is a useful tool for entrepreneurs.

Answer 1

5.a.

The business is created on an idea which is the basic need for the formation of the needed steps to make the business possible. The idea of the people’s need at a place or in a market is the idea that would make an individual or business to expand into that market segment. Based on the ideas of demand, innovation, purpose the business that is to be done is created.

However, the business plan is the step is one which is been done once the ideas of the business are been conceived. So once the idea for the business is made or the idea of what has to be done is clear. The plans are the step post idea generation which is to be applied in the reality is been made which is called a business plan. The planning done for the success of the business ideas is the process where the resources, physical application needs like resources, money, and skills are identified. A timeline-based work or project application to make the idea successful is the Business model.

5. b.

Maslow’s hierarchy of needs is very evident for individuals based on the level they are economically and socially. The physiology of needs is been arranged from bottom to top in the way of need hierarchy. Hence, they are physiological, safety, love and belonging, esteem, and self-actualization. Hence depending upon the situation of the business stage and the kind of money it has alongside other resources would determine the role of the entrepreneurs about the decision making for the business based on the stage the business is in and the needs for such situation as per the Maslow’s laws of need is applied. The tool helps the entrepreneur the idea of where to reach next based on where it stands today.