6 Steps to Help Any New Initiative Succeed
Apply the KISS principle to your venture. The 6 Step Canvas is ideal for disruptors, entrepreneurs and enterprise innovation teams
I founded a startup studio in Sydney, Australia in late 2018 and it still amazes me how many founders plow headfirst into their new venture based on assumptions.
Most have a bad case of confirmation-bias and look for any sign, no matter how weak, to help convince themselves they are on a winning track.
It’s not just startup founders who fail to test their assumptions.
In the corporate world, the success rate for new initiatives is less than 50% — even with the resources available in a corporation, assumptions are the major reason for failure.
So it won’t be surprising to know that step 1 of my 6 step process is focused on validating your assumptions.
Step 1 — Validate Your Key Assumptions
Your Customer Persona has a primary problem that has to be validated. At this very early stage be careful that you are validating your Customer’s problem and not your Customer’s Customer, i.e. you are validating the Persona that will pay you to solve their problem.
You may have a Domain expert in your team who is confident of the nature of the problem and wants to skip this step; even more reason to get an objective view by interviewing your Customer Persona and ask her to explain the nature of the problems she experienced and how she has attempted to solve them.
What you think you need to test is only the first step. Talking to customers helps validate if these are indeed the right problems to tackle and more importantly helps uncover possible solutions and techniques for testing them. Inability to validate Problem/Persona is a BIG red flag.
Step 2 — Conducting your Customer Interviews
Be wary of allowing your unconscious confirmation-bias to influence the way you interview customers. You MUST only ask open questions that make your customer give a thoughtful reply.
Closed questions that can be answered with a word, like yes or no, should never be asked. When you ask great, open questions you will be certain to discover the information you weren’t expecting.
LEAN Startup author Eric Ries says, “The goal of such early contact with customers is not to gain definitive answers. Instead, it is to clarify at a basic, coarse level that we understand our potential customer and what problems they have.” The Customer is the first hurdle where you will test your Problem hypothesis. The process to do this is essentially that of “getting out of the building”, attributed to the father of LEAN Startup, Steve Blank.
Two aspects of this step are very important — That you conduct these interviews as a discovery session, not a sales pitch session, and that you interview a sufficient number of people who confirm your hypothesis, i.e. >50% of those interviewed agree they have the problem.
Watch the video: https://youtu.be/lLEebbiYIkI
View the Customer Interview deck: http://bit.ly/2lGUZ4r
Step 3 — Solution Test
Step 2 will have probably revealed aspects of the customer scenario you hadn’t expected. Step 2 could also have caused you to reassess whether your original idea is even valid. If that is the case, just be thankful that you found out early that your assumptions were wrong.
If your assumptions were proven invalid you can loop back to Step 1 and iterate.
Given you have solid evidence that your idea has merit you can now work on what an ideal solution might look like.
Start by defining your solution using language and terminology that was used in your customer interviews. Try not to use too many terms that are overly technical unless your solution is for highly technical customers.
At this point take time to search for your competitors and don’t deceive yourself that there are none. Assess their features/functions/ capabilities and consider “can I do better?”. This effort to perform a competitor analysis will reveal a great deal about how these companies have approached solving the problem.
Depending on what your Startup is developing you may find that pictures communicate the solution far better than words. Physical products must have detailed diagrams. Websites and Apps need to be wireframes or prototyped. Showing is always better than telling and there is a myriad of tools to create website and App mockups.
Watch the video: https://www.youtube.com/watch?v=yeIM5IxvY-o
Step 4 — Business Model
Steve Blank says, “A startup is a temporary organization designed to search for a repeatable and scalable business model.”
You start by documenting a set of business model hypotheses, then systematically validate those hypotheses against reality and make course-corrections, or pivots, along the way. Your business model will be tested by going back to the Customers you interviewed to ensure they agree your model is viable. Your Business Model defines what the Customer will pay for what value.
“Business Plan: A document investors make you write that they don’t read. Business Model: A single diagram that describes your business.” — Steve Blank
Step 5 —Early Adopters
One of the biggest benefits of the previous steps is that you have been able to meet with potential customers under the guise of research, i.e. you haven’t been in sales mode, you’ve been in discovery mode.
The more potential customers you talk to the better because some of these will become your early adopters.
Not every future customer is ready for your product or service. The majority of the people that you can cater to in the future won’t forgive you if your product isn’t perfect. Therefore it’s important to start by finding people that will love your early-stage product as well — people that can help you improve the product over time.
Those people who don’t mind that your product doesn’t have all the bells and whistles yet, as long as the initial product is better than their current solution and they believe in you and your idea/vision.
This is what characterizes early adopters:
- They have been actively looking for a way to solve the problem
- They’ve tried unsuccessfully to put together a piecemeal solution
- They have or can obtain a budget to spend on a solution
Step 6 — Sales Test
“Do or do not… there is no try.”– Yoda. This wisdom from Yoda is so broadly applicable to your efforts and a major key to being successful.
During your work through all 6 steps, when people answer a question with, “yep that should just take a week”, the red flags start frantically waving. Never allow an answer that includes, “should” and “just” in the same sentence to pass by you. Ask for clarification about the “should just” statement, as in, “please tell me more why it ‘should just’ be fine in a week.
As you might expect, this is where the rubber hits the road. Steps 1 to 5 build into a pitch (http://bit.ly/5-slide-pitch), a deck and a proposal that can be presented to the Early Adopters you identified in Step 5.
The Sales Test must be conducted by the Founder/s. You will receive the most valuable feedback in your Step 6 sales meetings. Is your pitch easy to understand, does your solution actually solve the problem, is your business model acceptable, what unexpected questions and demands are tabled and is there a willingness to be a contracted customer.
Step 6 rules:
- NO bullshit,
- Don’t say ‘Yes” unless you’re totally sure,
- It’s OK to say, “I need to check and come back to you’,
- You want them as a reference account and a published case study,
- Watch how Steli Efti hustles — http://youtu.be/IfKMsdI9wJM
Help to Document Your Progress
I keep the plan for a new venture or project to 6 key steps. You can find people who’ll tell you need a full Business Model canvas or a complete and detailed business plan.
My view is, “why complicate your life more than you have to?”
In business, simplicity is the key to almost everything, no matter what industry or position you’re in. Keeping things reduced to the minimum viable product, whether that’s an actual product or something intangible like an idea or strategy, is essential to maintain focus and communicate effectively to stakeholders and observers. That means coming up with a concise plan you can easily convey to early adopters or coming up with a tight marketing strategy to bring to your team.
Feel free to download my 6 Step LEAN Canvas and use it as a tool to simplify the story and plan. You can also take each of the steps and add much more detail as you progress towards launching your venture or project.
Here’s the link to the editable 6 Step LEAN canvas.
About the author: Greg Twemlow is a Sydney-based Social Enterprise Founder | Startup Mentor | CEO | Writer | Speaker | Podcaster | Founder of Creativitee
