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BM ZEN Philosophy Book for Innovators
English Edition 2016. 5. 29.
Copyright @VisionArena 2015
Original Version Published on 29 April, 2016
www.businessmodelzen.com www.businessmodelzen.co.kr www.businessmodelforum.com www.bmhealthcheck.com http://industrysight.com http://gpathwayz.com
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STARTING WITH WHY
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Narrative starting with Why defines meaning of business model.
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About business model, the whole sum is bigger than the sum of parts.
That’s why we need integral thinking.
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Good tools make people to think over about worth questions, not simply to fill the blanks.
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Thinking drives change of action. Action drives difference of result.
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PURPOSE
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What we want, purpose can not be achieved with no purpose.
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Purpose is for knowing things that we shall not do rather than that we shall do.
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Both purpose and persistency make excellence together.
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Purpose means ‘Why'. Even if ‘Why' is fixed, ‘How' should be flexible.
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The company without its own purpose can not make meaningful innovation.
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ACTION
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We can learn things right only with action.
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Find hows rather than faults. Make things happen rather than finding hows.
That is innovator’s mindset.
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Why you should act quickly with little resources is to get in the right way by help of effective learning.
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CUSTOMER
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Compassion driving you to serve customer is the linchpin of entrepreneurship.
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People having the same specific problem you solve are your customer.
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Customer is alive and breeding by its nature. So we should not suppose all things going sensible, rational or reasonable like formula.
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PROBLEM
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Market is equal to the sum of customer’s problem.
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Valuation of company is equal to the sum of customer’s problem your company is solving in the present and future.
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Market will be found from unmet needs. Market is not created by your invention of new customer problem.
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Just ask problem to customer, not solution. Your company owe the solution.
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You can start innovation journey from dividing current problem and solution.
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When some problem really exists, no one can guarantee it is worth solving.
Good problem is in the sweet spot of that problem...is real, is recognized by customer, is explored to be solved by customer, has very little competing solution providers and has customer with sufficient budget.
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Every problems are laid in-between other problems.
The higher it is about desire. The lower it is about specific needs.
Which problem you choose among them makes different result.
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Every problems lie on the related buyer chain. (buyer, user, influencer,..)
One single problem can be perceived quite differently by person on the other side of buyer chain.
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SOLUTION
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Always (product) solutions are more than (customer) problems.
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Often the solution can be the source of another new problem (pain point) to customer.
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When you eventually solve this newly generated problem by your solution, we can call it excellent solution.
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Solution is made by problem-solving idea and implemented product.
Even when we have awesome idea, we need craftsmanship to make things happen.
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The success of product depends on the value customer finally gets, not the value you provide.
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Customer often use product as unintended way from maker.
This sort of unexpected happening help you to find hidden new customers or new problems.
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Your attempt to optimize your product skipping customer problem insight has its definite limit.
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The same product can generate quite different customer perceptions.
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ADVANTAGE
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Competition is disruptive by its own nature.
Success over non-competition is the most desirable high.
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Competition is determined by the customer problem which I decide to solve.
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Competitor is not enemy.
Rather, it could be good teacher to learn from.
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It does not mean competitor is your best teacher.
True learning that can lead to innovation lies in-between customer and me.
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Advantage today and unfair advantage reaching future are somewhat different.
Unfair advantage lies on sustainable core competency.
We can leverage this core competency when expanding to adjacent markets.
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EMPATHY
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Customers often have certain beliefs about specific categories and product lines.
This affect much on empathy from customer.
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You have to sell the problem before you sell the product.
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Customer search the reasonable why just after he/she decides to buy something at first moment.
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It is important to know the critical decision factor of customer’s buying.
Which is often hidden.
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We need to look at problem and solution separately.
A customer can empathize with problem but solution.
Likewise, a customer can empathize with solution but problem.
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Emotional and cultural approaches can lower the barriers to empathy from customer.
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COOPERATOR
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Cooperation makes it possible to overcome limitations of individual being.
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Competition and cooperation are two sides of the same coin.
However, it make significantly different results depending on what between them you expect from others.
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About cooperation, we also need philosophy and strategy.
The best performing company are good at cooperation as well as competition.
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The best imaginable cooperation enables reproducing good influence mutually in circulative manner.
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When we can not reduce the degree of irreplaceability, we must share a strong vision built on common destiny.
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Cooperative equations should be established so that the benefits of the common vision, long horizon of cooperation, enough interaction, and cooperation are higher than the benefits of betrayal.
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The sense of community sharing value boosts long-term cooperation.
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PROFIT MODEL
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You generate profits for better products rather than make product just for money.
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Here is the order: sell, survive, and grow.
Even if you can sell, it does not mean you can survive. Even if you can survive, it does not mean you can grow.
There are separate factors to be considered for each.
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In order to design an viable profit model, you need to look into the elements of the customer problem like frequency, importance and etc.
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Pricing should comes from customers’ WTP (willingness to pay).
WTP depends on customer's perception to product as well as the the importance of the problem to the customer.
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Profit model is the output of creative designing process through connecting buyer, payment time and complementaries.
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GROWTH MODEL
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Growth is achieved not by the company itself, but by volunteers for marketing. Which are product, customer, cooperator, and employee.
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Customer satisfaction is not just a result of sales, but a starting point for virtuous cycle of growth.
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The company sustaining the relationship with customer plays a game on different level compared to the one approaching the customer only with product.
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A powerful key message draws empathy from customer and traction.
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If one customer is bringing two other customers, your business is already equipped with the basis for growth.
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Growth through entering new and adjacent markets should start from understanding of self.
Seeking values and core competency fit lie in its core.
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Even if you have a big ambition to change the world, actual growth happens when you carefully balance the speed of execution based on awareness of reality.
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To go far you need to go together.
A growing business is equipped with excellence in both competition and cooperation.
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FEEDBACK
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Self-reflection is a feature of a strong and humble person.
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Only the humble can learn, only the learner grows, and only those who embrace differences can walk across the border.
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Fast feedback determines the speed of learning.
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BM ZEN Philosophy Book 2016. 5. 29. for Innovators
Copyright @VisionArena 2015
Original Version Published on 29 April, 2016
www.businessmodelzen.com www.businessmodelzen.co.kr www.businessmodelforum.com www.bmhealthcheck.com http://industrysight.com http://gpathwayz.com