Shipulski On Design

Ideas are cheap, but converting them into a saleable product and building the engine to make it all happen is expensive.  Before spending the big money, spend more time than you think reasonable to answer these three questions.

Is the problem big enough? There’s no sense spending the time and money to solve a problem unless you have a good idea the payback is worth the cost. Before spending the money to create the solution, spend the time to assess the benefits that will come from solving the problem.

Before you can decide if the problem is big enough, you have to define the problem and know who has it.  One of the best ways to do this is to define how things are done today.  Draw a block diagram that defines the steps potential customers follow or draw a picture of how they do things today. Define the products/services they use today and ask them what it would mean if you solved their problem. What’s particularly difficult at this point is they may not know they have a problem.

But before moving on, formalize who has the problem.  Define the attributes of the potential customers and figure out how many have the same attributes and, possibly, the same problem. Define the segments narrowly to make sure each segment does, in fact, have the same problem.  There will be a tendency to paint with broad strokes to increase the addressable market, but stay narrow and maintain focus on a tight group of potential customers.

Estimate the value of the solution based on how it compares to the existing alternative.  And the only ones who can give you this information are the potential customers. And the only way they can give you the information is if you interview them and watch them work. And with this detailed knowledge, figure out the number of potential customers who have the problem.  Do all this BEFORE any solving.

Will they pay for it? The only way to know if potential customers will pay for your solution is to show them an offering – a description of your value proposition and how it differs from the existing alternatives, a demo (a mockup of a solution and not a functional prototype) and pricing.  (See LEANSTACK for more on an offering.)  There will be a tendency to wait until the solution is ready, but don’t wait. And there will be a reluctance attach a price to the solution, but that’s the only way you’ll know how much they value your solution. And there will be difficulty defining a tight value proposition because that requires you to narrowly define what the solution does for the potential customer.  And that’s scary because the value proposition will be clear and understandable and the potential customer will understand it well enough to decide they if they like it or not.

If you don’t assign a price and ask them to buy it, you’ll never know if they’ll buy it in real life.

Can you deliver it? List all the elements that must come together. Can you make it? Can you sell it? Can you ship it? Can you service it? Are your partners capable and committed? Do you have the money do put everything in place?

Like with a chain, it takes one bad link to make the whole thing fall apart. Figure out if any of your links are broken or missing. And don’t commit resources until they’re all in place and ready to go.

Image credit — Matthias Ripp

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