No Compelling Value Proposition? No Business Needed!

Alex Osterwalder & team have created the definitive easy-to/must-uses guide on how to create a compelling value proposition - Value Proposition Design.  Yes, definitive.   Any business is first and foremost about the customer, even though it seems so many have forgotten that.  If you don’t have a compelling value proposition, you don’t need a business model because you won’t have a business. 

Value Proposition Design (#VPDesign) clearly teaches how to discover customers’ real needs – the needs they have for and by themselves, not the needs we want them to have or the needs we want to solve…even if they aren’t really the customers’.  The VPDesign toolkit – which is easy to follow, use and adopt – makes it difficult to retain your own biases and see reality.

It’s not just the words. The fabulous visual and symbolic style of the book makes it easy to follow, to use as a handbook and daily tool for prototyping, testing, iterating and creating meaningful and valuable solutions for customers. The icons are memorable and can become part of your team’s lexicon for thinking about customers. Just as in Business Model Generation, this book is a tool to use daily to think about your business – internally and externally. I’ve used the VPDesign extensively with entrepreneurs, intrapreneurs and for customers outside the organization and inside the organization.

So, you MUST get this book (and Business Model Generation) and start using it.  It will change how you view your business, your customers – for the better, in ways you can’t even begin to imagine.

In full disclosure, I helped co-create Alex & Yves’ first book, Business Model Generation, was a pre-reader for Value Proposition Design book and is a friend of Alex's.  And that's why I know, first-hand, how incredible and necessary these books are! Get them!!


#Whatif We Valued Trying?

We humans love to divide the world: yes, no; either, or; black, white; true, false; winners, losers; successes,Arianna Huffington, Co-Founder Huffington Post (designed by failures.  Yet little in life is really that nice and tidy, despite how much we want it to be.  And our world is not going in that direction anymore.

Many of us know that new discoveries, the disruptions, the innovations are found in the grey – in between the extremes, by recombining what is out there through And and Both instead of Either and Or.  As someone with a head of black, white and grey hairs, believe me, I live it!

Perhaps one of the most dangerous of these artificial constructs is that of successes or failures.  This has insidiously permeated so many of our systems – especially the language of entrepreneurship and innovation.  We don’t allow a middle or blended path.  When we look at the successful entrepreneurs, how many of them were successful the very first time? How many had overnight successes that truly were overnight, instead of years? Very few. 

What if we start talking about Tryers (which obviously means people will go to the opposite extreme of Non-Tryers) instead of just winners or successes?

What if we started encouraging and supporting those who try, over and over, be it the same or a different venture. 

What if we helped the Non-Tryers to understand why they didn’t try? Perhaps it is fear, time, who knows… but perhaps we could develop a support structure to allow them to become Tryers, in their own time?

What if we started to infiltrate our education system with tools, lessons, examples, opportunities to Try so that our children could become Tryers at earlier and earlier ages.  And What If we rewarded them for it? And What if we rewarded our teachers for teaching smart Trying?

While a full societal adoption of the Trying construct certainly will take time, you can start now! There are many ways you can start embedding Tryers into your organization’s lexicon.  So What If you, tomorrow, asked one of your people to Try and What if you back her or him up when she/he raises objections for why something couldn’t be done?  What if you just started with that?

Thank you to @mattmurrie for helping me more fully embed “What If” in my lexicon.

Intrapreneurship in "Social" Business

I'm again privileged to have an incredible "kid" share his wisdom on the role of intrapreneurship in social business. It's becoming more accepted in 'regular' business so let's apply it to social as well.  Allen Kramer, Brown '13, is going to change the world - so listen, learn, apply, iterate. 

Allen Kramer:  Reflection: Work with Assured Labor

I am passionate about giving low-income workers in Latin America access to jobs.  A powerful way to do this, called mobile recruitment uses text messaging (SMS: Short Message Service) to allow workers to find jobs. Having lived in and with off-the-grid communities in Latin America, in Nicaragua and Colombia, I had seen and felt the impact of low Internet and basic telecommunications access, especially when it comes to communicating with potential employers. Mobile recruitment bridges this gap in regions where access to mobile is on average 3 times greater than the Internet.

While working in Manizales, Colombia for Grameen Caldas (an affiliate to Nobel Peace Prize winning Grameen Bank in Bangladesh), the entrepreneur’s bug bit me and I finally decided I wanted to launch my own mobile recruitment service.  Like many “would-love-to-be” young entrepreneurs, I quickly realized just how much I didn’t know.  I did what most entrepreneurs do: I talked about my idea to anyone and everyone who would listen. Fortunately, I stumbled upon several people who took more than just a passing interest in what I was thinking about. I was directed to two companies already working in this market, Baba Jobs in India and Assured Labor in Latin America. Because of the regional interest, I contacted the CEO of Assured Labor, David Reich, to pitch my ideas.

When we met in January 2012, my idealist entrepreneurial dreams hit pavement as David shared their years of market experience in mobile recruitment while managing a large and rapidly growing team in over four countries. I knew little about developing mobile interface software or, when I admitted it to myself, how to build a business from the ground up. So I temporarily swallowed my entrepreneurial dreams and offered to work for the company to help them expand in key areas.

Over the course of the past year, there have been three distinct lessons that have stuck with me: 1) consumer insights can truly shape and determine a business’ success; 2) intrapreneurs play a vital role in (social) enterprise; and 3) being mission-driven is critical in deciding your own path.

First, some thoughts on consumer insights
The number of times I’ve heard people in social entrepreneurship communities off-handedly state ‘you have to know your beneficiaries’ is astounding. On the surface, this is a good thing – in fact, the point I am about to make is that you do have to have a profound knowledge of your target users in order to be successful.  But many of these people rarely dig deeper into understanding the real needs, circumstances and constraints.  Calling these people ‘beneficiaries’ instead of users or customers sums it up.

For instance, there is a company sells SMS to employers only to schedule interviews, not recruit. Less than 10% of the workers show up to interviews and many have dropped the service. Why? Employers send a SMS with little information about where and when the interview is to the workers’ cell phones with no tracking of receipt.  Why would a worker spend their scarce cash on a bus, with doubtful success of employment, to an unfamiliar area in a dangerous city like Bogotá from an unknown employer?

At Assured Labor, I tested the adoption of new products into new markets to understand product-market fit. My first step, a lá Four Steps to the Epiphany, was understanding workers’ pain points in trying to find a job. This customer discovery process let me identify the forces acting on a worker. What do they see when they wake up in the morning and walk out of their home? Where do the unemployed go to look for work? How do they learn where to go to find work? How do they pay for the bus to get there? What are the consequences of not finding a job? Who do they trust as reliable sources of information on employment opportunities?

This understanding lets me predict, sometimes simply better than asking directly, what a workers’ behavioral responses will be when they receive an SMS with a job opportunity, given a range of message content. Our investment in understanding answers to these questions has allowed Assured Labor to build viable solutions to the difficulties workers face while searching for jobs.

Intrapreneurship can drive organizational growth
I broadly define intrapreneurship as any role within an existing company that is largely self-directed and risky, forging out ahead of the status quo. Intrapreneurship has interesting power both to create opportunities for young people, such as myself, that are launching themselves into the social enterprise sector, as well as to spur significant innovation and growth within startups and existing larger companies. This power has gotten intrapreneurship featured recently in publications like Forbes.

My first experience with intrapreneurship was at Assured Labor.  I took responsibility, as well as the risk of my time and effort, to lay the groundwork for expansion to a new market. While the country had been on Assured Labor’s longer-term radar, I brought the bandwidth to actually take the first steps and identify its potential for short and medium-term company growth.

What does being an intrapreneur mean to the university student doing an internship or recent graduate? No more coffee runs or busy-work paper filing but the opportunity to flex your innovative muscles; the chance for independent learning-by-doing, while also taking advantage of the accumulated institutional knowledge and (hopefully) top-notch team of an existing company.

Intrapreneurship is a great way to prove your worth to the company when you do not have the credentials of years of work experience under your belt. This is especially true if you take on the financial risk of ‘bootstrapping’ your own intrapreneurial experience: take the personal and financial risk to do something new, get it done or have some good lessons from failure. You then have a better chance at creating a more permanent place for yourself within the team. Think of the job offer at the end as the ‘up-side’ to the initial investment. Obviously, most university students have scant savings to actually do this bootstrapping. Instead of using savings, there are a couple of alternatives. The first – which is the route that I took – is to apply to fellowships or grants that can provide some financial cushion. The second is to take a traditional paid or stipend internship and carve out an intrapreneurial role within it.

From the company’s perspective, fostering a culture of intrapreneurship brings significant advantages. First is the bandwidth to test out new ideas and to maintain a constant stream of innovation. As young companies move towards establishing their business models, rarely does a lack of ideas keep them from innovating.  It’s usually the limited capacity to test and iterate to find the best ideas and the best implementations. Recruiting motivated intrapreneurs can move this innovation forward. Second is the ability to create a recruiting pipeline of top talent and a team always thinking five steps out – especially when these intrapreneurs are students or young professionals where no long-term commitment is assumed at the outset. This just requires the management team’s dedication to cultivate internal leaders and to invest in them professionally.

Be mission-driven
Social entrepreneurship is facing a serious problem of ego. Too frequently, I have seen friends launch new nonprofits or social enterprises that largely duplicate the work of existing organizations and never scale, creating limited social impact. Two principal motivations seem to drive this duplication: 1) the desire to have complete ownership of the organization that is founded, with the sexiness that ownership confers; and 2) a genuine frustration with current existing solutions. Then, of course, there are just some bad ideas and stale social enterprise models.

Good social entrepreneurship should be driven by passion for achieving the social mission – everything else is just a vehicle to do so. So, if you are passionate about a social or economic issue – unemployment, to take a salient example – the best first step is to explore the structural causes of the issue and next examine what solutions have been developed. Learn from the past success and failures.

For sure, I have fallen trap to the ‘solution excitement’ on numerous occasions. Ultimately, what I have found is that there is a significant amount of existing momentum in ‘social enterprises’ that can be guided towards greater social gains. Assured Labor is growing close to 500,000 workers registered. One of the questions I have been helping answer at Assured Labor is how we can always make and keep the SMS jobs platform relevant for the lowest income brackets so the next 500,000 workers and the million after that; how can we disrupt hiring in Latin America and make it more equitable? Had I gone on to found my own company, the chances are slim I could have grown it to a user base of that size in so little time. Now, I’ve had the opportunity to inject ideas and growth opportunities that do positively affect a huge market of job seekers. So, part of being mission driven is also being intrapreneurial.

Sometimes it really is too hard to alter existing institutions and change needs to be driven from the outside. We need to be more analytical about founding of nonprofits and social enterprises. If you are thinking about doing so, first look at what organizations, companies, and other forms of innovations already exist in order to find opportunities to create changes from within. Lastly, if you want an opportunity to build an organization or company from the ground up because of the excitement, go for it – just steer clear of marketing yourself as the bleeding heart type, because you can muddle what is going to create impact in this world.