How solving a Personal Problem Can Trigger the Recognition of a Promising Business Opportunity

Tsatsral DorjsurenAmarzaya Nasanjargal

Louis BohanJesslyn Goh

Case 2.2

IntroductionMany entrepreneurs create business opportunities in response to personal problems they have.

◦Financial issues◦Recreational problems◦Family problems

family problems are urgent need a quick solution useful to other families a feasible business idea.

Introduction of FLAVORx

FLAVORx is a health care company devoted to helping people and pets take their medicine.

It was founded in 1994 by Kenny Kramm, and now it has 42 FDA-approved flavorings for both over-the-counter and prescription medications

And it is available in over 35,000 pharmacies worldwide.

FLAVORx: the founder’s backstoryIn 1992, Kenny Kramm’s second daughter, Hadley

was born premature.As an infant, she developed a medical disorder and

she needed to take awful tasting medicine. Every time she took the medicine, Hadley could not keep it down, and her condition

worsened.

In home R&D of FLAVORx?Hadley, Kenny and his father (who worked as a

pharmacist) started experimenting with concentrated flavors that could be mixed with Hadley’s medicine to hide its bitter taste.

Finally they produced banana flavor concentrate that they were able to safely mix with the medicine.

FLAVORx: a solution and business ideaHadley started taking flavored medicine without any

problems, and her condition stabilized.

Through solving his daughter’s problem, Kramm created a business idea which can help other people who cannot stomach bitter tasting medicine.

He then started his business by partnering with one of the largest flavoring companies in the U.S.

Introduction of CarePagesEric & Sharon Langshur were in a difficult situation

Matthew◦Born with heart defect◦Needed a series of surgeries

Langshurs found a way to keep friends and families up to date on Matthew’s progress

The CarePages WebsiteSharon’s brother created itIt resembled a modern day blog It also allowed people to respond and give words of

supportBy the time of Matthew’s last surgery, the site was

receiving several thousand unique hits a day

The Website (cont.)Eric saw it as a business ideaIn 2000, CarePages was bornIt was marketed to hospitals, which could make it

available to patients & family membersHospitals could also promote the service as well as

their brand name.Other benefits were to improve patient satisfaction

and make families more at ease because of the support they were receiving through their CarePages community.

CarePages Benefits Allow updates and replies, post a photo gallery, and

view the “About Patient” section, which provides the details of the patient

A running tally shows how many times a site has been accessed and how many messages have been left

Website visitors can “Invite Others”◦Even a person who doesn’t know the patient can visit the

page and offer support

CarePages

The pages are very touching, as parents share updates about a child who is facing surgery or treatment, or a serious medical condition

Families, Friends, and people the patients don’t even know post words of encouragement and support

The “CareCompliment” section◦Allows patients, families, and others to leave

compliments for nurses, doctors, and hospital staff◦This aspect of CarePages is very popular with

hospital personnel

CarePagesOver 700 health care facilities are CarePages clients,

and offer the service to patientsNo advertising in CarePages pageHealth care facilities pay CarePages and offer it to

patients for freeHealth care facilities benefits through improving

customer’s satisfactionPatients who use CarePages are more emotionally

healthy during their stay in hospital, because of the support they receive through their CarePages network

CarePagesIn early 2007, CarePages was acquired by

RevolutionHealth CarePages’ strategy and mission are not expected to

changeNow, CarePages generates 30 million page views per

month

Question and Answer

In This Chapter, an opportunity is defined as being (1) attractive, (2) durable, (3) timely, and (4) anchored in a product or service that creates value for its buyer or end user.

To what extent do FLAVORx and CarePages meet each of these tests of an opportunity?

Question 1

Answer 1: Test of opportunityFLAVORx CarePages

Attractive; helps founder’s child

Durable; long-term demand not based on a trend

Timely; solution to “icky” tasting medicine is urgent

Consumers need better tasting medicine

Attractive; helps founder’s friends show they care

Durable; satisfies human need to connect

Timely; hospitals using CMS can add CarePages to improve PR

Value in connectivity and social capital

Why do you think the idea of FLAVORx wasn’t developed by a large pharmaceutical company long before Kenny Kramm came along, and the idea for CarePages wasn’t developed by a hospital long before Eric Langshur came up with the idea?

Question 2

Pharmaceutical companies don’t have children that won’t swallow their meds

Laws in the US require meds to treat or cure illness, but not to taste good

The average time it takes for a new drug to pass R&D, and be certified by US Food and Drug Admin. (FDA) is 12 years.

Only 1 in 5,000 drugs invented survives R&D testing and makes it to market◦ Good taste is not a priority

Answer 2 FLAVORx

The hospital priority is patient satisfaction, treating illness and saving lives, not social networking

Doctors and nurses are worried about giving correct patient care, and avoiding mal-practice lawsuits

Some hospitals only recently installed information management systems (EES,CMS, EMS), so managing a social networking site is troublesome.

Answer 2 CarePages

Why do you think CarePages markets its product to hospitals rather than directly to consumers, like MySpace and Facebook do?

Question 3

He made this carepage because he felt that every patient's family needs emotional support

Instead of clients visiting the hospital's web page they choose the hospital based on the past patient’s satisfaction and experience

Answer 3

Generating this carepage provides him with a profit opportunity to introduce his hospital through this carepage and attract future clients.

What similarities do you see between FLAVORx and CarePages? What does each company teach you about the opportunity recognition process?

Question 4

Both were faced with difficult situationsBoth found creative solutionsFinally, both their ideas turned into businesses

From both situations, I have learned that any new idea can become a business idea.

But the issue is how to make it work and how to turn it into a real business.

Answer 4

How could FLAVORx & CarePages effectively use focus groups to Strengthen their existing products & solicit suggestions for related product ideas?

Question 5

Application Questions

First, the two companies can collect service comments from the patients, patient's family, friends, relatives and all staff.

Second, the focus group can discuss these patient comments and suggestions.

Thirdly, the hospital can implement a new process

Finally, hopefully, the next round of patient service comments will show improvement.

Answer 5

Question 6What other situations that people are in might make sense to set up a Web site or blog that allows a person to provide frequent updates and receive notes of encouragement and support from friends.

What’s new◦Facebook, MySpace, blogger

Personal health and fitness site◦Endomondo.com

Club or sport team event site◦Sportlobster.com

A website to organize team dieting, to share exercise and nutrition goals◦Socialdieters.com

Book club site ◦Goodreads.com

Answer 6

1. What’s your problem?2. Solve it! 3. Sell the solution.4. Be rich.

Problems = $

The End