Perspective taking is widely recognised as a valuable cognitive trait in entrepreneurship, particularly for identifying high-quality opportunities. However, its effectiveness may depend on the social embeddedness of the individual; specifically, whether they are organisational insiders or outsiders. This article integrates perspective taking with outsidership to examine how these factors jointly influence the novelty and usefulness of identified opportunities. Across three experimental studies, we find that insiders who engage in perspective taking tend to identify more useful opportunities, while outsiders generate more novel ones. Study 3 further reveals that perspective taking moderates the effects of outsidership, enabling both insiders and outsiders to identify opportunities that are simultaneously more novel and useful. Notably, perspective taking helps outsiders overcome the typical limitation of their position to enhance the perceived usefulness of their ideas and also helps outsiders have their ideas perceived as relatively more novel. These findings advance entrepreneurship research by clarifying the distinct roles of social positioning and perspective taking in opportunity identification and offer practical guidance for organisations seeking to generate innovative ideas.
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