journey from idea to a real business
TRANSCRIPT
Thinking Like a CEOA Professional Development Workshop to Grow Your Business
09.24.16
Dr. Michael Burcham
2What is Asked Of You
Wha
t You
Are
C
apab
le o
f Doi
ng
Weakness
Power
Today We Are Going to Work on Your Business Super Powers
1. Core Competency
2. Target Customer
3. Define theProblem
4. BusinessModel
4 Steps to Analyze Your Business Readiness
What are YouReally Good at Doing?
Who is the Ideal Customer for You?
What is Their Pain that You are Solving?
How do You Make Money Doing This?
What are your company’s Core Competencies?
A core competency is a deep proficiency that allows you to deliver unique value. It’s a strength; a competitive advantage.
These are typically:
- Rare- Valuable- Hard to Imitate- Sustainable
1Step
TOP 3 CORE COMPETENCIES OF MY BUSINESS
1.
2.
3.
RARE
Not everyone has this skill, know how, or technology.
VALUABLE
My clients & competitors all know this has value.
SUSTAINABE
I can keep this edge for a long time.
IMITATIONS
This is very hard for anyone to copy.
Who is your Target Customer
Who is the organization’s customer today?What are the characteristics and needs of the customer of the future?
Think about:
- Their preferences and characteristics- The products they buy and the brands they love- Their “pain” that you will solve- What would cause them to “buy”
2Step
Find the Early Adopters and Innovators!
Source: Geoffrey Moore, Crossing the Chasm
IDENTIFY & MEET THE EARLY ADOPTERS
10
Define your Opportunity as a Customer Problem…
What is the “problem” you want to solve for your customers? Does your ”solution” match their problem?
3Step
EXERCISE | Customer Problem Discovery
What is the problem you want to solve for your customers? Who else is attempting to solve the problem.
Think about:
- Do I have any data to support my belief?- Is this really the pain or just a symptom? - How will I validate this with the customer?- Does the customer want this pain solved?
How Do I Make Money Doing This?
Be certain that you are using a business model that is known among the investment community and has successful companies using it.
• Subscription• Transaction• Bricks and Clicks• Component Business Model• Direct Sales• Franchise• Freemium• Razor and Blades Model• Intermediary Distribution Model
4Step
FRAMING THE BUSINESS | Part 1
Problem | Customer Pain
Solution | The Fix
Relevance | So What
Model | How Does This Make Money?
DistributionPlan
CustomerIntimacy
RevenueDrivers
Partners &Outsourcing
Product or Service
CostDrivers
CriticalResources
EssentialRecipe
TargetCustomer
REVENUESHow
We MakeMoney
EXPENSESThe
Creation of Margin
UPDATE YOUR BUSINESS MODEL DESIGN
64
Frame Your Future: Know the Business Drivers
4 Things Drive Revenue:– The Product or Service– Customer Adoption– A Strong Distribution Channel– Customer Intimacy
4 Things Drive Costs:– Human Capital – Labor– The Essential Ingredients for the Product or Service– The Process or Value Chain– Ability to Partner and Outsource
THE IDEA FRAME | WHAT IF
1. P
RO
DU
CT
5. KEY INGREDIENTS
6. PARTNERS
7. ESSENTIAL RECIPE
8. COST MODEL 9. REVENUE MODEL
2. CUSTOMER
4. INTIMACY
3. DISTR
IBUTIO
N
Company Name Version Number Date
THE IDEA FRAME | WHAT IF
65
1. P
RO
DU
CT
5. KEY INGREDIENTS
6. PARTNERS
7. ESSENTIAL RECIPE
8. COST MODEL 9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy u
s?2. CUSTOMER
4. INTIMACY
3. DISTR
IBUTIO
N
Company Name Version Number Date
THE PRODUCT QUESTIONS
• What is it? • Who has one like it?• Why now? • Why us?
THE IDEA FRAME | WHAT IF
66
1. P
RO
DU
CT
5. KEY INGREDIENTS
6. PARTNERS
7. ESSENTIAL RECIPE
8. COST MODEL 9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
4. INTIMACY
3. DISTR
IBUTIO
N
Company Name Version Number Date
THE CUSTOMER QUESTIONS
• Who are early adopters? • What is their pain? • How do they solve it today?• What brands do they buy? • What causes them to choose us?
THE IDEA FRAME | WHAT IF
67
1. P
RO
DU
CT
5. KEY INGREDIENTS
6. PARTNERS
7. ESSENTIAL RECIPE
8. COST MODEL 9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
4. INTIMACY
3. DISTR
IBUTIO
NHow
do customers hear about us?
How do they buy?
Is it easy to buy?At w
hat price?Company Name Version Number Date
THE DISTRIBUTION QUESTIONS
• How do customers hear of us? • How do they buy?• Do we make it easy to buy? • At what price will they buy?
THE IDEA FRAME | WHAT IF
68
1. P
RO
DU
CT
5. KEY INGREDIENTS
6. PARTNERS
7. ESSENTIAL RECIPE
8. COST MODEL 9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
4. INTIMACY
3. DISTR
IBUTIO
N
Why do early adopters like us?How do we engage them?
Will they become ourAmbassadors?
How do custom
ers hear about us?How
do they buy?Is it easy to buy?At w
hat price?Company Name Version Number Date
CUSTOMER INTIMACY
• Why do early adopters like us? • How are we engaging them?• Will they become ambassadors?
THE IDEA FRAME | WHAT IF
69
1. P
RO
DU
CT
5. KEY INGREDIENTSWhat are the core elements of the product or service that are unique to our team? What are the critical ingredients in my design that we must own?
6. PARTNERS
7. ESSENTIAL RECIPE
8. COST MODEL 9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
4. INTIMACY
3. DISTR
IBUTIO
N
What causes customers to like us?How do we engage them?
Will they become ourAmbassadors?
How do custom
ers hear about us?How
do they buy?Is it easy to buy?At w
hat price?Company Name Version Number Date
KEY INGREDIENTS
• What are the core elements of the product or service that are unique to our team?
• What are the critical ingredients in my design that we must own?
THE IDEA FRAME | WHAT IF
70
1. P
RO
DU
CT
5. KEY INGREDIENTSWhat are the core elements of the product or service that are unique to our team? What are the critical ingredients in my design that I must own?
6. PARTNERSWho are the key partners who will provide certain outsource and supply chain services? What partner brands help us look larger than life?
7. ESSENTIAL RECIPE
8. COST MODEL 9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
4. INTIMACY
3. DISTR
IBUTIO
N
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
What causes customers to like us?How do we engage them?
Will they become ourAmbassadors?
How do custom
ers hear about us?How
do they buy?Is it easy to buy?At w
hat price?Company Name Version Number Date
PARTNERS
• Who are the key partners who will provide outsource and supply chain services?
• What are the brands that will help us look larger than life?
THE IDEA FRAME | WHAT IF
71
1. P
RO
DU
CT
5. KEY INGREDIENTSWhat are the core elements of the product or service that are unique to our team? What are the critical ingredients in my design that I must own?
6. PARTNERSWho are the key partners who will provide certain outsource and supply chain services? What partner brands help us look larger than life?
7. ESSENTIAL RECIPEWhat is the perfect mix of the core elements? What partnership | outsource activities that meet the customers needs without being overly complicated?
8. COST MODEL 9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
4. INTIMACY
3. DISTR
IBUTIO
N
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
What causes customers to like us?How do we engage them?
Will they become ourAmbassadors?
How do custom
ers hear about us?How
do they buy?Is it easy to buy?At w
hat price?Company Name Version Number Date
ESSENTIAL RECIPE
• What is the perfect mix of the core elements?
• What partnerships will meet the the customers needs without being overly complicated?
THE IDEA FRAME | WHAT IF
72
1. P
RO
DU
CT
5. KEY INGREDIENTSWhat are the core elements of the product or service that are unique to our team? What are the critical ingredients in my design that I must own?
6. PARTNERSWho are the key partners who will provide certain outsource and supply chain services? What partner brands help us look larger than life?
7. ESSENTIAL RECIPEWhat is the perfect mix of the core elements I must do? What partnership | outsource activities that meet the customers needs without being overly complicated?
8. COST MODELAre items (5-7) a reasonable cost structure? Can we create a competitive margin? What is our best guess of the margin?
9. REVENUE MODEL
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
4. INTIMACY
3. DISTR
IBUTIO
N
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
What causes customers to like us?How do we engage them?
Will they become ourAmbassadors?
How do custom
ers hear about us?How
do they buy?Is it easy to buy?At w
hat price?Company Name Version Number Date
THE COST MODEL
• Are items 5-7 a reasonable cost structure?• Can we create a competitive margin?• What is our best guess of the margin?
THE IDEA FRAME | WHAT IF
73
1. P
RO
DU
CT
5. KEY INGREDIENTSWhat are the core elements of the product or service that are unique to our team? What are the critical ingredients in my design that I must own?
6. PARTNERSWho are the key partners who will provide certain outsource and supply chain services? What partner brands help us look larger than life?
7. ESSENTIAL RECIPEWhat is the perfect mix of the core elements I must do and the partnership | outsource activities that meet the customers needs without being overly complicated nor costly?
8. COST MODEL 9. REVENUE MODELWhat can we charge for the product or service? Based upon our costs, is the idea sustainable? Is it investment worthy? Can it scale and grow?
Wha
t is
it? W
ho h
as o
ne lik
e it?
Why
now
? W
hy m
e?2. CUSTOMER
4. INTIMACY
3. DISTR
IBUTIO
N
What is the pain?Who are early adopters?
What brands do they buy today?What causes them to choose us?
What causes customers to like us?How do we engage them?
Will they become ourAmbassadors?
How do custom
ers hear about us?How
do they buy?Is it easy to buy?At w
hat price?
Do items (5-7) create an affordable cost structure? Can I create a competitive market margin for the product or service at the price I can charge? What is my best guess of the margin?
Company Name Version Number Date
THE REVENUE MODEL
• What can we charge for the product or service?• Based upon our costs, is the idea sustainable?• Is it investment worthy?• Can it scale and grow?
THE IDEA FRAME | WHAT IF
74
PEOPLEOrganizational ModelsExecutive SupportRecruitingEmployee ActivationProductivityCulture
OperationalReadiness
PROCESSGovernanceCustomer OnboardingDelivery WorkflowsScale & ExpansionMeasurementReporting
TECHNOLOGYMetrics ApplicationSales CRMRelationship ManagementTrackingEnterprise Software
24
Reinvent
Adjust Features
Emotional
Rational
Leve
l of D
isru
ptio
n
DISRUPTIVE INNOVATION
Change Story
Change Key Words
25
10 TYPES OF INNOVATION
Inside-out Outside-in
Process Offering Delivery FinanceInnovationProcess
CoreProcess
Product | SvcPerformance
ServiceSystem
CustomerService
The DeliveryChannel
TheBrand
CustomerExperience
BusinessModel
ValueNetwork
how a company organizes to support innovation
proprietary processesthat add value
basic features,performance,and functionality
extended system thatsurrounds an offering
how you serviceyour customers
how you create an overallexperience for customers
enterprise structureand value chain
how theenterprisemakes money
how you connectyour offerings toyour customers
how you expressyour offering’sbenefit to customers
26
1. Industry Players
2. Funding
3. Public Policy
4. Technology
5. Customers
6.Accountablity | Safety
3 KINDS OF INNOVATION and 6 FORCESHERZLINGER’S MODEL OF INNOVATION
A. The ways customers use the innovation
B. The technology that leads innovation
C. New business models of innovation