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Opportunity Evaluation Using Uncertainties in Software Entrepreneurship


  • Tomy Sarath


  • Pardede Eric

    (Department of Computer Science and Information Technology, La Trobe University, Bundoora, Victoria3086, Australia)


Understand the uncertainties and evaluate the opportunity are essential to support the number of new businesses launched every day. The aim of this paper is to analyse the uncertainty factors related to the evaluation of opportunity in software entrepreneurship. This study is concerned with developing a simple and effective framework for software entrepreneurs to evaluate opportunities for their projected venture and predict its success in an uncertain environment. The paper begins with identifying uncertainty factors relevant to software start-ups. Then, we introduce the Opportunity Evaluation Model to evaluate the scope of opportunities as moderated by the uncertainties using External Factor Evaluation (EFE) and Internal Factor Evaluation (IFE) matrix methods. The model outputs Internal-External (I-E) matrix containing graphical representation of the opportunity position, with the strengths, weaknesses, opportunities and threats identified from the inputs. Two case studies with different factor ratings for uncertainties are demonstrated using the model with a detailed explanation of the procedure of implementation. The article ends with a note on the efficacy of the framework and reiterates the importance of research examining opportunities in relation with surrounding uncertainties. Early recognition and management of uncertainties identified in this paper can increase the chance of success for new software ventures.

Suggested Citation

  • Tomy Sarath & Pardede Eric, 2017. "Opportunity Evaluation Using Uncertainties in Software Entrepreneurship," Entrepreneurship Research Journal, De Gruyter, vol. 7(3), pages 1-16, July.
  • Handle: RePEc:bpj:erjour:v:7:y:2017:i:3:p:16:n:3

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    References listed on IDEAS

    1. Sebestova Jarmila & Rylkova Zaneta & Smysl Marek, 2007. "How to Gain Success in SME? A Case Study of a region in the Czech Republic," South East European Journal of Economics and Business, Sciendo, vol. 2(1), pages 41-47, April.
    2. Stein W. Wallace, 2000. "Decision Making Under Uncertainty: Is Sensitivity Analysis of Any Use?," Operations Research, INFORMS, vol. 48(1), pages 20-25, February.
    3. Giarratana, Marco S., 2004. "The birth of a new industry: entry by start-ups and the drivers of firm growth: The case of encryption software," Research Policy, Elsevier, vol. 33(5), pages 787-806, July.
    4. Denis A. Grégoire & Pamela S. Barr & Dean A. Shepherd, 2010. "Cognitive Processes of Opportunity Recognition: The Role of Structural Alignment," Organization Science, INFORMS, vol. 21(2), pages 413-431, April.
    5. John Butler & Robert Doktor & Frederick Lins, 2010. "Linking international entrepreneurship to uncertainty, opportunity discovery, and cognition," Journal of International Entrepreneurship, Springer, vol. 8(2), pages 121-134, June.
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