journey from idea to a real business

Thinking Like a CEOA Professional Development Workshop to Grow Your Business

09.24.16

Dr. Michael Burcham

[email protected]

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

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


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1. P

RO

DU

CT

5. KEY INGREDIENTS

6. PARTNERS

7. ESSENTIAL RECIPE


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


THE PRODUCT QUESTIONS

• What is it? • Who has one like it?• Why now? • Why us?


66

1. P

RO

DU

CT

5. KEY INGREDIENTS

6. PARTNERS

7. ESSENTIAL RECIPE


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


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?


67

1. P

RO

DU

CT

5. KEY INGREDIENTS

6. PARTNERS

7. ESSENTIAL RECIPE


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

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?


68

1. P

RO

DU

CT

5. KEY INGREDIENTS

6. PARTNERS

7. ESSENTIAL RECIPE


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

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


CUSTOMER INTIMACY

• Why do early adopters like us? • How are we engaging them?• Will they become ambassadors?


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


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 causes customers to like us?How do we engage them?


How do custom




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?


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


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





How do custom




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?


71

1. P

RO

DU

CT



7. ESSENTIAL RECIPEWhat is the perfect mix of the core elements? What partnership | outsource activities that meet the customers needs without being overly complicated?


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





How do custom




ESSENTIAL RECIPE

• What is the perfect mix of the core elements?

• What partnerships will meet the the customers needs without being overly complicated?


72

1. P

RO

DU

CT



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





How do custom




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?


73

1. P

RO

DU

CT



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





How do custom



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?


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?


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

journey from idea to a real business

Small Business & Entrepreneurship