how scalable lean startups can use the rod map to inspire today's investors ... while getting...

How Scalable Lean Startups Can Use The Red Ocean Disrup;on (ROD) Map

To Inspire Today’s Investors While Ge(ng Needed Funds and Higher Valua4ons

Dr. Rod King

Worksheet of

The Red Ocean Disrup4on (ROD) Map

#4ROD. Dr. Rod King. [email protected] & hMp://businessmodels.ning.com & hMp://twiMer.com/RodKuhnKing

Red Ocean Disrup;on (ROD) Map Date: ………………………..….

q Vision Experiment q Problem-‐Solu;on Experiment q Product-‐Market Experiment q Op;miza;on & Scaling q Renewal

Project Vision (Cause/Final Result/Outcome): ……………………….…………..………………………………………………………..…………………..…..…… Customer (Segment/Base/“Tribe”/Benefactor): …..…………………………………………….….……….………..……………………………..…………..…… Goal/Strategy/Job-‐To-‐Get-‐Done: …………………...…………..…………………………………………………………..……………..….…………………………….…… Conven4onal Tool (Product/Service/Business Model): ………………………………..…….……………………………………………………………………..


D: Define Problem (Needs)

B: Build Solu4on (Pilot)

M: Measure Problem (Effect)

A: Analyze Problem

I: Improve Solu4on

L: Learn What’s Valued

Date: ………………………..….



Red Ocean Disrup;on (ROD) Map





A: Analyze Problem

I: Improve Solu4on


Customer Story Business Story Learning Story

Date: ………………………..….








A: Analyze Problem

I: Improve Solu4on


Customer Story (ROD Problem)

Business Story (ROD Solu:on)

Learning Story


Date: ………………………..….

Experim

ent/

Cycle 1

Experim

ent/

Cycle 2

Experim

ent/

Cycle …







A: Analyze Problem

I: Improve Solu4on


Date: ………………………..….

Business Model Analysis

Business Model Disrup4on Strategy

Red Ocean Business Model (Product/Service)

Minimum Viable Business Model (Product/Service)

Blue Ocean Business Model (Product/Service)

Business Model (“PEAR”) Metrics








A: Analyze Problem

I: Improve Solu4on


Date: ………………………..….








P.I.E.S. Features

Note: P.I.E.S. is an acronym for Physical; Intellectual; Emo:onal; Spiritual

Disrup;ve ……………………………… (Prototype/Demo)







A: Analyze Problem

I: Improve Solu4on


Date: ………………………..….



P: Process (Trade-‐off) E: Engagement A: Acquisi4on A: Ac4va4on R: Reten4on R: Referral R: Revenue






P.I.E.S. Features









A: Analyze Problem

I: Improve Solu4on


Date: ………………………..….








Lifecycle Experiments q  Vision (Leap of

Faith) Experiment

q  Problem-‐Solu4on Experiment

q  Product-‐Market Experiment

q  Op4miza4on & Scaling Experiment

q  Renewal/ Disrup4on Experiment


P.I.E.S. Features









A: Analyze Problem

I: Improve Solu4on


Date: ………………………..….



E: Eliminate

R: Reduce

I: Increase

C: Create







Faith) Experiment






P.I.E.S. Features









A: Analyze Problem

I: Improve Solu4on


Date: ………………………..….



E: Eliminate

R: Reduce

I: Increase

C: Create






q  PRODUCT/ VALUE PROPOSITION

q  CHANNELS/CUSTOMER RELATIONSHIPS

q  PROFITABILITY

q  COST (PAIN)

q  REVENUE (DELIGHT)

q  UNFAIR ADVANTAGE


Faith) Experiment






P.I.E.S. Features





Red Ocean Disrup;on (ROD) Maps of

The World’s Most Successful Scalable Lean Startups

“Reinvent (Disrupt) The Customer Experience

In The Tradi;onal X-‐Industry”


RED OCEAN DISRUPTION (ROD) VISION The North Star of the World’s Most Innova:ve Companies


A Scalable Lean Startup Story About the Evolu;on of Man (Homo Sapiens) How Nature Uses the Lean Startup Method in a Fractal Lifecycle of 5 Experiments

Problem-‐Solu;on Experiment

Chasm

Vision Experiment (“Big Bang” Disrup:on)

Product-‐Market Experiment

Op;miza;on & Scaling Experiment

Renewal Experiment

?

Fractal Lifecycle Plan for Scalable Lean Startups

Lean Startup’s Journey &

Milestones


Red Ocean Disrup;on (ROD) Map of Apple (iPhone): 2007




A: Analyze Problem

I: Improve Solu4on




Not So“Smart”

Small Screen

Complex: Hard to Use

Fixed Key-‐board; Stylus

Touchscreen Mobile Phone/ Digital Music

Player/ Internet Navigator

“Insanely Great Customer Experience”

E: Eliminate Fixed plas:c

keyboard/buZons; Pen stylus; Manual

R: Reduce Size/Thickness;

Weight; Complexity; Learning/:me

I: Increase Price; Screen Size; Performance; Syncing; Design

C: Create Touchscreen;

Packaging; Visual Voicemail; Apps; Ads

Smartphones P: Process (Trade-‐off) E: Engagement A: Acquisi4on A: Ac4va4on R: Reten4on R: Referral R: Revenue

iPhone


Project Vision (Cause/Final Result/Outcome): Reinvent (Disrupt) the Customer Experience in the Phone Industry Customer (Segment/Base/“Tribe”/Benefactor): Luxury-‐Spot “Game-‐changers” Goal/Strategy/Job-‐To-‐Get-‐Done: Seamless Mul:-‐media Communica:on: Differently Phone, Listen to Music, and Browse Internet Conven4onal Tool (Product/Service/Business Model): Cell phones; Smartphones: Moto Q; Blackberry; Palm Treo; Nokia E62; Digital Music Player; Desktop/Laptop Computer




Disrup;ve Smartphone

(Prototype/Demo)


Faith) Experiment






P.I.E.S. Features q “Supersmart”

Phone q Dead Simple to

Use q Cool, Sexy Design q Ultra-‐slim q No Keyboard or

Stylus



Red Ocean Disrup;on (ROD) Map of Apple (iPod): 2001




A: Analyze Problem

I: Improve Solu4on




Limited Song Storage

Limited BaMery Life

“Ugly” Design; Bulky

Skipped Songs

Ultra-‐Portable Digital Music

Player: “A Thousand Songs in Your

Pocket”

“Insanely Great Customer Experience”

E: Eliminate Control BuZons; Gray/Black Color; On-‐off Switch

R: Reduce Size/ Weight; Thickness;

Complexity

I: Increase Price; Song Storage; BaZery Life

C: Create LCD Screen; Wheel; Fast Download

Music Players P: Process (Trade-‐off) E: Engagement A: Acquisi4on A: Ac4va4on R: Reten4on R: Referral R: Revenue

Classic iPod


Project Vision (Cause/Final Result/Outcome): Reinvent (Disrupt) the Customer Experience in the Music Player Industry Customer (Segment/Base/“Tribe”/Benefactor): Luxury-‐Spot “Game-‐changers” Goal/Strategy/Job-‐To-‐Get-‐Done: Seamless Music Experience (Everywhere): Differently Listen to Music Conven4onal Tool (Product/Service/Business Model): Portable Music Players – CD-‐Player; Flash Player; MP3-‐CD Player; Hard-‐Disk Jukebox




Disrup;ve Music Player

(Prototype/Demo)


Faith) Experiment






P.I.E.S. Features q “Unlimited” Song

Storage q Cool, Sexy Design q Long Bagery Life q No Skipped

Songs



Red Ocean Disrup;on (ROD) Map of Cirque du Soleil: 1984




A: Analyze Problem

I: Improve Solu4on







Animal Cruelty

High Price of Aisle Seats

Divided AMen;on in 3-‐Ring Venue

Expensive Star Performers

Avant Garde Circus

Unique

Circus-‐Theater Entertainment

E: Eliminate Star Performers; Animal Shows;

Aisle Concessions; Mul:ple Show Arenas

R: Reduce Fun and Humor; Thrill and Danger

I: Increase Unique Venue

C: Create Theme; Refined Environment;

Mul:-‐Produc:ons; Music and Dance

Tradi;onal Circus P: Process (Trade-‐off) E: Engagement A: Acquisi4on A: Ac4va4on R: Reten4on R: Referral R: Revenue

Cirque du Soleil


Disrup;ve Street Performance

Act (Road Show/Demo)

Project Vision (Cause/Final Result/Outcome): Reinvent (Disrupt) the Customer Experience in the Tradi:onal Circus Industry Customer (Segment/Base/“Tribe”/Benefactor): Sweet-‐Spot “Game-‐changers” Goal/Strategy/Job-‐To-‐Get-‐Done: Differently Experience Live Entertainment (Circus) Conven4onal Tool (Product/Service/Business Model): Tradi:onal Circus; Musical; Broadway Theater; Spor:ng Events


Faith) Experiment






P.I.E.S. Features q Unique

(Broadway-‐type) Circus

q No Animal Cruelty

q Classy Venues



Red Ocean Disrup;on (ROD) Map of Southwest Airlines: 1971




A: Analyze Problem

I: Improve Solu4on







Delays on Ground

High Ticket Price

Unserved Prospects

Low Cost Airline

E: Eliminate Meals; Lounges;

Sea:ng Class Choices; Hub Connec:vity

R: Reduce Price of Air Ticket

I: Increase Friendly Service;

Speed

C: Create Frequent

Point-‐to-‐Point Departures

Short-‐Haul Transport P: Process (Trade-‐off) E: Engagement A: Acquisi4on A: Ac4va4on R: Reten4on R: Referral R: Revenue


Project Vision (Cause/Final Result/Outcome): Reinvent (Disrupt/Democra:ze) the Customer Experience of the Air Travel Industry Customer (Segment/Base/“Tribe”/Benefactor): Low Cost “Game-‐changers” Goal/Strategy/Job-‐To-‐Get-‐Done: Interstate Travel: Differently Travel Between Ci:es Conven4onal Tool (Product/Service/Business Model): Tradi:onal Airlines; Train; Taxi; Con:nental Airlines; Pacific Southwest

Disrup;ve Short-‐Haul Transport (Prototype/Demo)

Disrup;ve Short-‐Haul Transport

“The speed of a plane at the price of a car … whenever you need it”


Faith) Experiment






P.I.E.S. Features q Low Cost q Timely Flights



Red Ocean Disrup;on (ROD) Map of Google (Search Engine): 1998




A: Analyze Problem

I: Improve Solu4on







Banner Ads

Irrelevant/Paid Search Results

Complex User Interface

Disrup;ve Search Engine

E: Eliminate Banner Ads;

Paid/Sponsored Rankings

R: Reduce Delay in Displaying Search Results

I: Increase Relevance of

Search Results/Ads

C: Create Automated Ad

Purchasing System; Clean (Elegant/ Simple) Interface

Search Engines P: Process (Trade-‐off) E: Engagement A: Acquisi4on A: Ac4va4on R: Reten4on R: Referral R: Revenue


Project Vision (Cause/Final Result/Outcome): Reinvent (Disrupt) the Customer Experience of the Search Engine Industry Customer (Segment/Base/“Tribe”/Benefactor): Blue Ocean “Game-‐changers” Goal/Strategy/Job-‐To-‐Get-‐Done: (1) Differently Get Accurate Search Results (2) Differently Get Leads/Purchases Conven4onal Tool (Product/Service/Business Model): Tradi:onal Search Engines (Yahoo; Excite; GoTo.com; Lycos)

Untargeted and Costly Ads

Disrup;ve Search Engine

“Organize the world’s informa:on

and make it universally

accessible and useful”


Faith) Experiment





(Prototype/Demo)


P.I.E.S. Features q Simplicity q Relevance q Speed q  Inexpensive Ads Note: P.I.E.S. is an acronym for Physical; Intellectual; Emo:onal; Spiritual

Red Ocean Disrup;on (ROD) Map of

An Emerging Red Ocean Disrup;on

(ROD) Lean Startup





A: Analyze Problem

I: Improve Solu4on


Customer Story (ROD Problem)

Business Story (ROD Solu:on)

Learning Story

ü  Vision Experiment q Problem-‐Solu;on Experiment q Product-‐Market Experiment q Op;miza;on & Scaling q Renewal Experim

ent/

Cycle 1

Experim

ent/

Cycle 2

Experim

ent/

Cycle …

Red Ocean Disrup;on (ROD) Map for Red Ocean Disrup;on (ROD) University

ROD U

Date: October 2013

Project Vision (Cause/Final Result/Outcome): “Develop Tools for Collabora:vely and Rapidly Resolving the Global Healthcare Crisis” Customer (Segment/Base/“Tribe”/Benefactor): BLUE OCEAN “GAME-‐CHANGERS”: Macro/Meso/Microsystems (Disruptors) Goal/Strategy/Job-‐To-‐Get-‐Done: Cost-‐effec:vely Improve and Disrupt Exis:ng Tools, Services, Brands, and/or Business Models Conven4onal Tool (Product/Service/Business Model): Business/Strategic Plan; Lean/Six Sigma Method; Learning From Defect; A3 Problem Solving Template


Red Ocean Disrup;on (ROD) Map for Red Ocean Disrup;on (ROD) University




A: Analyze Problem

I: Improve Solu4on







Time-‐consuming

Voluminous; Rigid; Costly

E: Eliminate •  Complexity R: Reduce •  Cost

•  Prepara:on Time •  Size/Thickness •  Waste (Failure)

I: Increase •  Relevance; Ac:on

•  Versa:lity •  Collabora:ve Problem Solving •  Flexibility C: Create

•  Heuris:c: DB-‐MAIL •  ROD Teams

Tradi;onal Planning & Problem Solving



Waste of Resources

ROD Quartet of Tools

(Con4nuous Problem Finding & Solving)

D B M A I L

hgp://businessmodels

.ning.com

Web Site (Sign up/Landing Page)

ROD U

ROD University

Date: October 2013

Disrup;ve Tool Lifecycle Experiments q  Vision (Leap of

Faith) Experiment





ü  Vision Experiment q Problem-‐Solu;on Experiment q Product-‐Market Experiment q Op;miza;on & Scaling q Renewal


P.I.E.S. Features q One-‐page q Simple q Fast q Versa4le q  Inexpensive

Project Vision (Cause/Final Result/Outcome): “Develop Tools for Collabora:vely and Rapidly Resolving the Global Healthcare Crisis” Customer (Segment/Base/“Tribe”/Benefactor): BLUE OCEAN “GAME-‐CHANGERS”: Macro/Meso/Microsystems (Disruptors) Goal/Strategy/Job-‐To-‐Get-‐Done: Cost-‐effec:vely Improve and Disrupt Exis:ng Tools, Services, Brands, and/or Business Models Conven4onal Tool (Product/Service/Business Model): Business/Strategic Plan; Lean/Six Sigma Method; Learning From Defect; A3 Problem Solving Template

ROD Cycle: Origin of

The Red Ocean Disrup4on (ROD) Map


q D: Define Problem q B: Build Solu4on q M: Measure Problem q A: Analyze Problem q  I: Improve Solu4on q L: Learn What’s Valued

Red Ocean Disrup;on (ROD) Cycle: DB-‐MAIL Red Ocean Disrup;on (ROD) Map for Product Innovators, Improvers, Planners, and Lean Startups

D: Define

B: Build

M: Measure

A: Analyze

I: Improve

L: Learn

Note: The ROD (DB-‐MAIL) Cycle is a synthesis of ideas from the Scien4fic Problem-‐Solving Process, Six Sigma’s “DMAIC” heuris4c, Eric Ries’s “Build-‐Measure-‐Learn (BML)” Loop, Kim & Mauborgne’s Blue Ocean Strategy, and Jean-‐Marie Dru’s Disrup4on.

Business Lifecycle Evolu4on 1.   Vision (Leap of Faith) Experiment Does the vision, cause, theme, or Job-‐To-‐Get-‐Done of the project empower the targeted customers (co-‐creators)?

2.   Problem-‐Solu;on Experiment Would a minimum viable product/service (prototype) solve a validated Big Urgent Market Problem (BUMP)? 3. Product-‐Market Experiment Is the proposed (more featured) product/service/business model effec:vely and profitably solving the Big Urgent Market Problem (BUMP)? 4.   Business Model Op;miza;on &

Scaling Experiment Can defects or waste in processes be rapidly and cost-‐effec:vely eliminated, i.e., brought to the level of Six Sigma (3.4 defects in 1,000,000)? Can the business model be scaled or repeated? 5.   Business Model Renewal/

Ecosystem Disrup;on Experiment How best to disrupt exis:ng (matured) product/service/business model?

ROD Cycle for

Each Evolu:on/Experiment (Project): DB-‐MAIL


5 Applica;ons of the Red Ocean Disrup;on (ROD) Map Red Ocean Disrup4on (ROD) Cycle: DB-‐MAIL

VISION DOCUMENTATION, PLANNING, EXECUTION, AND PRESENTATION

BUSINESS MODEL IMPROVEMENT: Lean/Six Sigma Projects; Process/Product/Service Improvement Projects

BUSINESS MODEL DISRUPTION (INNOVATION): Lean Startup Projects; Process/Product/Service Innova4on Projects

BUSINESS/STRATEGIC PLANNING: Business Plan Projects; Strategic Plan Projects

BRAND DISRUPTION: Brand Reinven4on/Disrup4on Projects; Disrup4ve Marke4ng Projects

You can use the Red Ocean Disrup4on (ROD) Cycle or Map to rapidly and cost effec4vely do the following projects:

q D: Define Problem q B: Build Solu4on q M: Measure Problem q A: Analyze Problem q  I: Improve Solu4on q L: Learn What’s Valued

how scalable lean startups can use the rod map to inspire today's investors ... while getting...

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