One of my colleagues who is a great business mentor, Tom Hagemann, developed one of the modules for our FlipZone program, and it really struck me in its depth, simplicity and sophistication. I want to share some of that here.
Every day we are confronted with the question of what is our best next move. Everyone thinks about it for themselves, and it is crucial for business planning as well. Some structured thinking can really help to sort out the options and develop a short list which can then be winnowed down to one or two things to really put effort into.
First, think about the product customer matrix. The product customer matrix has product or service on one axis and customer on the other axis, and it has four quadrants. In the lower left we have the current service and current customer. In this box we write about how our current offerings improve the lives of our current customers.
In the lower right, we have current offerings and future customers. In this box we write about who we can help like we help our current customers.
In the upper left, we have future offerings and current customers. In this box we write about what else we could offer to our current customers. What are they asking us to offer? Can we ask them what else they might want from us?
In the upper right is the danger zone: future offerings to future customers. Early stage companies typically cannot afford to reach there and ideas like this need to be put in the parking lot until said customer or offering becomes current.
Your best next move is in one of the boxes adjacent to the lower left. And the evaluation of these comes from the insight of my friend Tom. He calls it the crawl-walk-run method.
The crawl question is simple, yet powerful: Does this option solve a demonstrable pain-point or need-point for the customer? If no, rule it out. Evaluate each option in your list.
The walk question is simple as well: Do you have any money? If the answer is no, you have no choice other than to do the cheapest and fastest of the options. Even if the gain is small, this is about all you can do. Evaluate the remaining options on speed and cost and pick the one with the best balance of the two.
The run-a-marathon level comes in to play when your business is solid and you have a bit of time and money. In this position, you can evaluate your options via a longer horizon and more strategically. Look at the revenue potential of each option and your passion and the team’s passion for them. Look at the severity of the customer pain and what might be coming in to play from competitors. Look at the resource load needed to do it. Would it change how we define ourselves, and is that good or bad? Does it help us achieve our long-term goals? It’s your baby, so you need to want to do it. But your customers need to pay, so they need to need it. And with all that effort, try to hit a long ball.