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Discovery entrepreneurs have often acquired specialised knowledge and information about exploiting an opportunity they have discovered. In industries where this knowledge may be embodied more in human than in physical capital, entrepreneurs, taking advantage of specialised knowledge acquired from their employers, may leave and start their own businesses (Chaston 2004).

Individuals looking to exploit discovery opportunities may have other sources of information, such as: consumer knowledge acquired through encounters with company representatives; customer evaluation of products or services; knowledge of the willingness and ability of customers to pay; and knowledge about market demand and the activities of existing competitors (Chaston 2011).

The impact of available information is that it alerts entrepreneurs to potential new discovery opportunities. Many of those engaging in discovery will have a clear idea of the possible outcomes associated with exploiting an opportunity. Entrepreneurs often do not know with any certainty the potential scale of opportunity resulting from their discovery. The range of possible outcomes may be substantial, suggesting a high level of risk. However, previously acquired industry-specific technical or market-related experience can be used by entrepreneurs to gauge the riskiness associated with opportunity exploitation (Perry and Murphy 2011).

The Austrian School of economics assumed markets are composed of people who possess different information and knowledge (Schumpeter 1950). The possession of idiosyncratic information allows people to see particular opportunities that are not obvious to others, even when they are not actively searching for them. This is because variations in information and knowledge influence individuals to identify different values in a commercial proposition. Individuals do not discover entrepreneurial opportunities through search, but instead through recognition of the value of new information which has been acquired (Kirzner 1997).

The question arises: why do some individuals discover entrepreneurial opportunities and not others? One answer is that people recognise opportunities related to information and knowledge that they already possess (Venkataraman 1997), which varies according to their education or employment experiences. Each individual’s prior knowledge creates a knowledge corridor that results in the recognition of certain opportunities, and influences the individual’s ability to comprehend, extrapolate, interpret and apply new information. For example, a person who had previously worked in a market as a customer, manufacturer or supplier may possess information about how a new technology might influence a market. This prior information can assist discovery of an opportunity to exploit the new technology in a totally different way (Von Hippel 1994).

Shane (2000) posited that prior knowledge moderates the relationship between the attributes of a technology and the recognition of entrepreneurial opportunity. He theorised that (1) any given technological change will generate a range of entrepreneurial opportunities that are not obvious to all potential entrepreneurs; (2) entrepreneurs can discover these opportunities without searching for them; and (3) any given entrepreneur will discover only those opportunities related to their prior knowledge.

Identification of novel information and knowledge is a key input to new product development, at the heart of which lies the emergence of something new or novel. A search that directs attention towards new information and knowledge leads the searcher to develop new behaviours, interactions, strategies and processes that are useful in new product development. Li et al. (2013) suggest that the search process involves two components: ‘search selection’ which focuses on the locations managers choose to direct their attention to during search; and ‘search intensity’ which describes their level of cognitive effort and persistence when searching. These two dimensions are important because irrelevant infor?mation, or a failure to recognise or examine relevant knowledge, wastes time and attention.

Li et al. employed the notions of ‘terrain unfamiliarity’, ‘terrain distance’ and ‘terrain source diversity’ as key dimensions of search selection. Unfamiliar, distant and diverse terrains are more likely to contain novel, salient and vivid information that captures searchers’ attention. Consequently, such new knowledge is more likely to enable searchers to detect insights and breakthroughs related to radical product innovation. Such terrains are also more likely to yield new information, which helps searchers update their knowledge base and gain insights into the detection, development and deployment of new products.

Smith et al. (2005) found that the rate of new product introduction is a function of knowledge workers’ ability to combine and exchange information. They determined that novel information enables firms to develop new ideas about how to allocate resources better, and how to co-ordinate innovation efforts. Furthermore, novel information allows firms to discard obsolete knowledge. This is critical because replacing obsolete knowledge can help reduce the possibility of firms becoming trapped in behaviour based on competencies developed and used in the past.

Attention intensity represents the level of effort, persistence and cognitive capacity deployed to notice, interpret and make sense of information and knowledge (Schleimer and Shulman 2011). Search intensity has an important influence on the success of innovation outcomes. Gregoire & Shepherd (2012) suggested that where managers stop gathering information after finding a satisfactory alternative, they may remain ignorant of better alternatives. In the context of developing new products, increased search effort and persistence provide searchers with enhanced capacity to notice, interpret and make sense of information and knowledge in ways that foster the detection, development and deployment of new products. By exerting effort in a given terrain, searchers increase their capacity to notice and compare different sources of knowledge that are potential new-product building blocks. Li et al. argued that attention intensity, search effort and persistence expand the scope of the searchers’ knowledge of alternatives that in turn can enhance product development success. Finding new knowledge can generate creative insights that lead to more radical levels of innovation. However, where there is only limited knowledge evaluation, its significance for product development may not be fully understood.

Li et al. (2013) concluded that in high-tech industries, both selection and intensity of search significantly affect the number of new product introductions. Intensity and selection in combination may affect the nature of new product introductions. The researchers suggested that high-level innovation requires firms to find an appropriate fit between selection and intensity of search. This is because the search selection dimensions of terrain unfamiliarity, distance and source diversity were found to have a positive impact on the nature of new product introductions. Furthermore, unfamiliar, distant and diverse searches are more likely to contain salient information and knowledge which can provide the basis for radical innovation.

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