If you’ve been following this thread of blog articles helping you to develop an innovation process in your business, this is the final chapter.
All the hard work along the journey of the innovation process is almost complete, and all the barriers have almost been overcome.
You’ve built an environment in which employee creativity can freely flow, you’ve sensed a problem in your business and subsequently directed employee focus, which saw you presented with creative and innovative ideas for your business.
In the most recent stage of the innovation process, you tested the viability of the product by presenting a prototype to the public.
If, now, you are certain that the solution you have designed to answer your consumer’s problems is a good one, and you have generated enough interest and deemed there to be enough value in the market for your product, it is time to take the final step and look to Launch your product or service
BUSINESS MODEL FEASIBILITY
It is now time to flesh out all the areas of the business model to stack the odds in your favour for success and help you to uncover potential risks and challenges you may face.
I’m not a fan of lengthy 50+ page Business Plans (unless of course your funding source or investors require this). If it’s just you and perhaps another business partner or two, I like to use a more high level, flexible and action focused approach to Business Planning.
Why are you better than the competition, what are we offering that makes us the better provider of this good or service than anyone else? You must be clear on this because most of your key marketing messages will lean heavily on this position.
Next, you need to clearly define a target market for the product. Map explicitly who they are, what they look like, how they behave and where the hang out. We use a process called Zebra Identification which I will cover in a later blog. But basically you need to know who your ‘perfect customer’ is.
If here you find yourself identifying two disparate groups as your targets, it is important that you create two separate ways of positioning the product in order to appeal to both groups; don’t just limit yourself to one target group, but in the same vein don’t expect them both to be attracted to the same marketing attempts.
Channels & Relationship
How are we going to communicate with our customers? Where will they find us, how will they evaluate us and what are the “Easy Entry Points” into our business?
You may have already done some early feasibility testing throughout the Build, Test, Refine stage but now it’s time to get serious.
Do the numbers really stack up? Forecast Sales, along with expected Cost of Goods and then look at completing a basic Expense Budget. Be sure to account for your personal time and contribution (you don’t come for FREE). I see this happen far too often where budding business hours don’t cost their time into the production and delivery of the end product or service. Ultimately they end up in a business model where they are always the last to get paid! Avoid this mistake.
Operations & Resources
Next step is to identify the operational needs for manufacture of the product; these are the things you physically need complete and the resources you need to complete them. It would also include key partners and personnel needed.
Here you will explore the levels of demand for the product, evaluate consumer behavior with regards to your newest business innovation, and estimate the growth potential of the product, giving you insight into whether the new business idea is worthy of launching. You must also calculate your initial startup costs for any equipment, stock or working capital you need to get things underway before you collect your first revenues. After this you will have a strong idea whether you have enough capital to get the product off the ground. If not, you need to seek external funding if you want to launch.
All going well you are now getting close to pressing GO!
Consistently refining this innovation process along the way and constructing your business’ own individual innovation tempo is imperative, and will only see your innovative processes and new business ideas strengthening each time around.
One important thing to remember is that while innovations will drive growth in your business, approx. 70 per cent of activities within your business should remain focused on the core business that underpins the businesses revenue and cash flow.
The new ideas and innovations you are now focused on developing should only comprise 10 to 15 per cent of business activities, with the other 10 to 15 percent dedicated to Sales & Marketing along with administration and many other business functions. (of course every business model if different and this simple time split will not suit all situations)
It is important you do not drop all core business activities to focus on one innovation that may or may not succeed. You must not find yourself stuck with a whole heap of ideas and no intentions of acting on them.
Having said that, I believe a simple key to startup success is to start small, don’t jump right ahead and bet the bank on your innovation, but make sure you do start. Perhaps a cut down model of your business is a lower risk method of starting.
There is nothing to be gained from creating ideas but stopping halfway through the process; start small, but most importantly, make sure you start!
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BizScaping has an Incubator program called the BizIdeas Depot which is a Lean Start-up program designed to provide affordable coaching to get New Ideas & New Businesses off the ground. You may be surprised just how attainable, high level professional business advice can be!