How to execute business ideas that focus on a customer’s real problem
Voltaire said, ‘originality is nothing but judicious imitation'. In this blog we consider how to execute business ideas that focus on a customer’s real problem, bringing the
right ideas to life, making sure we are executing the right ones, at the right time for our business and its resources. And finally, we will also look at the importance of testing and validating ideas for business.
In a recent blog I discussed how to create good business ideas that harness diverse thinking and perspectives, but to really capitalise on the idea, we need to create order out of what could otherwise be chaotic creativity.
In my previous blog on this topic I discussed the impact the right framing and stimulus has on the quality of business ideas that you create; but in my view, although great ideas are not exactly ten-a-penny, whether you can bring those product or service ideas to life in business is all about having a process that executes the ideas really well. Can you focus the ideas on a specific group of customers for whom those products or services solve a big urgent problem?
There is no such thing as a bad idea, or is there?
No one wants to jam the creative mechanism, right? However many of us have been in creative meetings where business ideas have been stifled by a yawn, a raised eyebrow from a person of influence, or by an unhelpful naysaying comment. The notion of hindering thoughts about how my idea is received or if it is deemed a bad idea, can inhibit people’s contribution and stop the flow of ideas. Maybe it would be better for everyone in the room to be aware that there are good and bad ways to react to an idea.
Don’t believe experts.
Clearly, the input of experts can be invaluable in coming up with new business ideas. The truth is that a new idea is a great leveler because invariably it has never been tried. Experts who are endowed with tried and tested knowledge don't always have a great advantage when it comes to the unknown. Einstein said that ‘problems cannot be solved by thinking within the framework in which they were created’. Whilst accepting that if you are having a hip replacement operation it would be very comforting to know that the surgeon and his team are all experts, experts have a history of using their expertise to unwittingly sabotage an idea before it has had a chance to grow into something more defined. That said, a great idea that genuinely solves a burning customer segment problem is very hard to stop.
Where the experts got it completely wrong.
‘Television won’t be able to hold onto any market it captures after the first six months. People will soon get tired of staring into a box every night’ said Darryl F. Zanuck, Head of 20th Century Fox, 1946.
Thomas J. Watson, Chairman of IBM said in 1943 that he thought ‘there is a world market for about five computers’.
And when the Decca record label decided not to sign the Beatles in 1962 it was because ‘guitar-based bands are on their way out’.
So, how do we evaluate business ideas that are generated?
This is where the terms good and bad are often used. A far better term to use would be useful or not useful. This might seem like semantics, but whether something is useful or not useful can depend on the context. Once timing, and various resources are taken into account an idea that is not useful in one context may be very useful in another. There are many examples of ideas that were not useful being recycled and used somewhere else.
A good example of this is in the pharmaceutical industry where they are not so quick to dismiss so-called bad ideas. This is probably due to the fact that a lot of time and money goes into creating new drugs. So, there are many examples of drugs that were developed for a specific end-use that did not work only to find that it works for another use that was not the original intention; Viagra is a good example of this. Language is very powerful and labeling things good and bad may lead to missed opportunities.
How do we determine whether an idea is useful or not?
We must have a goal or a target to evaluate against. The goal is hopefully born from trying to solve a particular problem. I have often discussed the types of problems that customers have, and the size and nature of a customer group’s problem is critical when evaluating an idea.
Who sets the goal?
If it is not obvious already, it is of course the customer. Trying to generate business ideas is not best done in a vacuum. If you do not perceive the ideas that you are trying to generate as solving a problem for a customer, then you are not thinking about the product or service you are trying to come up with deeply enough.
As with everything, there are famous examples that do not follow the rule of listening to the customer, including some of the product ideas that Steve Jobs executed on at Apple. And when Henry Ford said that ‘If I had asked my customers what they wanted, they would have asked for a faster horse’ However these are very much the exceptions that prove the rule.
Everything needs to be viewed through a prism of ‘solving a big problem’ for a customer. Absolute originality is not always the goal but the simple equation is that:
No big problem solved = no interest = no customers = no business.
And then you need to work out if the business idea you are developing solves a big enough problem for the customer to give you money to solve.
There can be many causes for the failure of a new idea or business and very rarely is it down to just one thing. Usually, a number of factors come into play. It is always useful to analyse and understand the main causes and learn from them for future reference.
Some common reasons for new ideas failing include overestimating the market size, unforeseen technical barriers, not being able to deliver against a market price, not solving a big enough problem, not solving an urgent enough problem, not seeing the customer is happy with the current imperfect solution, competitor action, product brand positioning, incorrect messaging, timing. We can all be victims of over-optimism and wilful blindness, but quite often, even with big corporate R&D budgets, things out of our control or simply ‘wrong time wrong place’ can come into play.
Here is an example.
First released in November 2006, the Zune was Microsoft’s ‘me too’ answer to the iPod. While it had some nifty product features that the iPod lacked, the Zune, despite an expensive marketing effort by Microsoft, never really caught on. On a design level, the Zune lacked style and the simplicity of Apple’s interface. The Zune seemed clunky in comparison. Perhaps more importantly, though, the Zune could not be used with Apple’s iTunes programme, an even more dominant product in its market than the iPod. By integrating the music experience, Apple had created a compelling ‘magnetic’ or ‘sticky’ solution that a competitor just could not be overcome.
The obstacles to creating good business ideas.
If we look at the reasons behind obstacles to innovation, three stick out. The first is selecting the right ideas to commercialise; this is the biggest obstacle to innovation apart from development time being too long.
Secondly, not enough great ideas; here I would suggest that divergent thinking needs to improve as I discussed in my previous blog.
And finally not enough customer insight; this might indicate a poorly defined problem that we are trying to solve. These three areas around ideation when combined are the most significant factors in obstacles to innovation.
So how do we avoid the pitfalls?
One way of trying to avoid some of the obstacles is to use a method called outcome-driven innovation. Outcome-driven innovation was popularised in a book by Anthony Ulwick called ‘What Customers Want’. The idea is that we need to focus on the job a customer wants to do rather than a product to buy. I think we could easily replace the concept of ‘job to be done’ with ‘problem to be solved’. The most famous example given in the book is based on the power drill. The basic idea is what the customer wants is a hole and the only reason the customer wants a drill is to create the hole. The purpose of this methodology is to keep us focused on what problems customers want solving or jobs they want to do so we can have well-defined targets to focus our business idea on.
One of the disciplines where idea generation is the critical skill or a core competence is in design. Developing ideas is the essence of a design role so there is lots we can learn from the processes designers employ. User-centric design and design thinking have become accepted in many design spheres, often following what Steve Jobs said about design not being what a product looks and feels like, but design is about what a product does and who it does it for.
Are the people in a business the best people to come up with new business ideas?
From a business perspective there are many different types of innovation and coming up with ideas is part of innovation. But it is not just about making a new product or service. Different ways of doing something can be just as creative and productive as inventing a new product.
There are many good examples of founder or internal company originated business ideas that have been executed successfully through product or service innovation. Airbnb, is the largest accommodation provider with no accommodation themselves. They innovated the BnB market by adapting the model of who can be the host. Uber did the same with the taxi industry, and everyone knows how Amazon has revolutionised shopping.
The Ford Model T became the first mass-produced car by using process innovation; mass production in cars changed the production method and made cars cheaper and more affordable.
Product innovation usually happens incrementally; Apple incrementally improves its iPhone each time a new model comes out.
The move to convenience for the customer and savings for businesses is a big driver in service innovation and a lot of it is formulated around the concept of self-service. 50 years ago, there were petrol pump attendants who filled your car with petrol and now that is a thing of the past. A more up-to-date example today would be supermarkets using self-checkouts or banks introducing online and mobile banking.
It is also true that there are large corporations, with their own innovation teams that find it hard to innovate. There are many reasons for this but often it harks back to innovation being stifled in the ways I mentioned earlier.
It may be surprising but there are businesses that help find and develop innovation for large corporations, it’s called tech scouting. One such company is Strategic Allies whose CEO, conveniently named John Allies, says ‘Often tech scouting provides that externally validated input, blinkers off, that can reveal opportunities that would otherwise go unnoticed. Scouting is also a commitment that means the output must be taken seriously and given due consideration rather than internal ideas that are often too easily dismissed.’
Turning your business idea into something that works.
How do we get our ideas to work in reality? This part of the process is not quite as exciting or sexy as all that creative thinking, but nonetheless it is absolutely necessary. This is where the hard yards have to be put in. Hence the famous saying from Thomas Edison that ‘Genius is 1% inspiration, 99% perspiration’.
If you don’t get organised and do something an idea will just be an idea. A surplus of ideas is more dangerous than a drought. This statement speaks to the fact there is only so much you can do, and the key is to do the right things in the right order.
So, we need a process to move from ideas to action.
Much of the skills, discipline and type of thinking at this stage of the process are much more akin to conventional business management processes. Following the basic steps of sound business management should work well for you at this stage; prioritising, action and ownership.
Work out what needs to be done, allocate tasks that are reasonably achievable, possibly taking smaller steps than you had imagined as there will be unknowns that come to light. Then take action with each person involved taking personal responsibility for their allocated tasks and responsibilities. There are lots of project and scorecard tools available to help you, so use them and collaborate, and help each other in an empathetic trusting manner.
This is all about who does what by when. All the above steps at first glance are basic, but whether you have the simplest of ideas to implement or you are trying to land a spacecraft on the moon the same simple steps need to be employed rigorously.
What is a good business idea?
A great way of evaluating ideas and one which is far too often overlooked is taking a good long hard look at the competition. A competitor that has been in the market in a similar area that you may want to go into has a wealth of historical information that you can draw upon. In the public domain there is often information on pricing, with a little digging you get information on costs, you can review customer feedback so you have really everything you need to analyse what the current position is and how it can be improved. You might be able to work out what the competitor's value proposition is, how they create that value, who the customer is, and even see their revenue model. With this information and some analysis a new innovation may become apparent.
So, you have come up with your ideas, you have decided which are the best ones to pursue and you start to bring an idea to life. But before going full steam ahead it is sensible to try and test your ideas first. Sometimes what that means is having the right kinds of conversations with the right people.
We have already covered where we are going to get our ideas from. This is all about making sure we have a clear target that is well aligned with our customer’s problems. So, in essence our evaluation starts at the point of what ideas we want to generate and hopefully this emphasises to you how important that stage is. Asking good questions of the right people is the least expensive and quickest way of evaluating your ideas.
It is all about being creative while minimising risk. We have to remember that more ideas fail than succeed so if we want to live another day it is better to avoid large-scale catastrophic failure that puts you off ever wanting to try starting a business again. And that's why it is so important to start with the right kind of conversations and then move onto committing time and resources. In reality if you are going to go through with a business idea, taking that leap of faith, you will eventually create a product or service; so the real choice is whether you decide to have the right kind of conversations before bringing a product or service to the market. My advice is always to make sure you have the right conversations.
There are some excellent books that touch on the aspects of making ideas happen and evaluating ideas, including The Lean Startup by Eric Reiss, Business Model Generation by Alexander Osterwalder and Yves Pigneur, Getting to Plan B by John Mullins and Randy Komisa. My favourite is The Mom Test by Rob Fitzpatrick.
And finally, although we now know that part of the idea is the process of working out how to get to the end goal, ideas, and the execution of those ideas, is like eating an elephant; best done by taking small bites.
Patrick Burge is a specialist in business growth having helped build online and offline businesses in many sectors including tech start-ups, apparel, sport, fitness, health, printing, retail, coaching and consulting. Apart from specialising in the brand licensing and franchising sector, he has also advised numerous businesses on getting their strategy and funding in place on several UK Government Programmes. He can be contacted at email@example.com or firstname.lastname@example.org