Step 1 – Providing Innovative Products and/or Services to Ideal Customer Communities!
What is an entrepreneur? The entrepreneur is the person who can take a seed of an idea and create and orchestrate a new (startup) enterprise to apply the idea to serve a customer community by providing a solution to a problem the customer community has to make a profit.
A CEO is the person responsible for leading an organization to achieve business objectives, typically profitable revenue growth. The CEO must lead his/her organization to apply their assets to bring new products and/or services to market to serve customer communities for a profit.
The only difference between an entrepreneur and an established enterprise’s CEO is the available assets, degree of focus and degree of organizational agility their respective organizations have.
We have observed that startups and enterprises wrestle with the question, “which comes first the seed of an idea or the identification of a customer communities’ problem”.
The answer is obvious when the entrepreneur or CEO is a member of the customer community, knows the customer community operation, recognizes the problem and perceives the seed of an idea that provides the solution to the problem “Necessity is the Mother of Invention”
The answer is not so obvious when the seed of an idea comes from technologists that have discovered a disruptive breakthrough in the current thought/belief framework in order to bring about improvements. Sometimes this situation is referred to as a “solution in search of a problem”.
More often than not, even when the seed of an idea comes from a technologist, the research and development that the technologist is involved in has its roots in the scientific endeavor to form hypothesis to overcome limitations and solve a technological problem. This includes Thought Experiments to hypothesize operational (functional) improvements to be derived. Whether the seed of an idea and eventual invention solves the R&D problem fostering the R&D work or not, is where Necessity is the Mother of Invention may lose the thread of the logic back to a customer community to be served. Oftentimes, the invention has multiple uses and it becomes the entrepreneur’s responsibility to identify ideal customer communities that can be served that provide economic justification for starting a new successful business.
So we are back to the fundamental (chicken or the egg) question, which comes first the seed of an idea or the identification of an ideal customer community to be served by providing a solution to their problem (a purpose). We submit that innovation is always couched in the context of ideal customer communities ability to improve their operations.
Startups typically come from the perspective of a seed of an idea that may or may not have an ideal customer community identified, whereas established enterprises start from the perspective that they already serve one or more ideal customer communities and are looking to expand their ability to further serve their existing customer communities and/or penetrate new customer communities with the a new version of the products they make.
Either way, having a seed of an idea and not being able to identify ideal customer communities that will use your invention or product, is like the proverbial question “If a tree falls in a forest and no one is around to hear it, does it make a sound?”
Entrepreneurs are looking to create a new highly successful business enterprise, whereas high growth established enterprises are looking for the opportunity to apply their assets to expand penetration and business expansion in serving their ideal customers. Both are looking to serve ideal customer communities with innovative new products and grow their businesses (make a sound).
Whether you are an entrepreneur developing a new business and/or a strategic business developer of an established high-growth enterprise, your objective is to foster innovation to be able to deliver high customer value products to serve ideal customer communities. To be able to achieve this objective requires that you perceive an innovative way (use of your product) for an ideal customer to perceive sufficient value (realize improved operations) to be willing to pay for your product such that you can earn a profit.