If your mind is anything like mine you think up one or two business ideas in a week. If you’re lucky, in a month one of those ideas will be great. Of course, there’s quite a distance to cover between great ideas and executing them. Before you rush to accept the challenge to execute you want to make sure your business idea is a great idea. A truly great idea and not just one in your head. So you need a framework to help investigate or research on ideas to make sure they are worth it.
Understand the problem you solve
I’m sure you’ve heard enough business gurus ask “what problem do you solve”? The problem statement is meant to boil down your business into one sentence. “We assist people who want to start businesses with business plans and support through business-related articles” is an example of a problem statement. That is knowing the problem. Understanding the problem is going deeper into the causes of the problem. Zimbabwe has a high degree of information asymmetry and there is very little desire to pass information from those who have it to those who need it. That is understanding the problem. So while your business Idea may be to provide social media management, understanding why the problem exists helps greatly in evaluating your opportunity. It makes the difference between business ideas which take root and those pronounced dead on arrival.
Customers and competition
There are two ways to understand this and they largely depend on whether the business idea is completely new (ie new market) or the business itself is a new entrant in an existing market. My favourite way of looking at this is asking yourself “what are your potential customers currently using to solve the problem you want to solve for them”? The mistake I’ve seen many make in this regard is an extreme degree of competitor focus at the expense of customer focus. Understand the behaviours of both groups within the market. It is easy to criticise sellers in a market for not doing something or adding something to a product until you find that the buyers in a market do not place value on that thing.
Where competitors and customers are internal forces acting on the market there are external forces that act on markets. A great example of this is the threat that online messaging platforms WhatsApp and Facebook among others brought to mobile operators in Zimbabwe. I use this example to point out that forces are not always direct or easy to identify. What seems like a disconnected event or process can have a ripple effect that eventually affects the business and industry as a whole. It’s not always a case that these forces ruin and industry, they may improve an industry as has been the case with online shopping and how easy it has been for Zimbabwean businesses to adapt to it during the COVID-19 induced lockdown.
In many cases, businesses have specific critical keys to success. These can best be described as capacities or capabilities than enable them to execute their processes. Ride-hailing services such as Uber, Hwindi and Vaya, for example, rely heavily on the software systems that coordinate the many moving parts including drivers, clients, navigation systems and payment systems. Online shopping systems can.be conducted manually but any hope of scaling rests in possessing an automated system. It’s different for different businesses, some have huge working capital requirements others need specific expertise. Your ability to access or possess these key capacities is what’s important.
There’s a youtube video that discusses the issue of timing being the most important factor in business success. One of the most popular and currently relevant examples of this is how Microsoft owned Skype was the leader in video calling in 2012 but Zoom has taken centre stage during the 2020 COVID-19 pandemic because they were already working on the needs of enterprise for video calling and conferencing. Nothing wrong with Skype as a product, they peaked at the wrong time. Closer to home a friend had an idea to start a pop-up restaurant back in 2011 but didn’t pursue the idea because it wasn’t prevalent back then. Is this the right time for your solution? There is the ongoing debate as to whether or not the government of Zimbabwe’s plan to roll out education over the radio is the right move given there are many internet-based possibilities. Radio remains the best option in terms of access and simplicity, though it still does not offer complete coverage. Online education is great but the timing is not right in the Zimbabwean context. William Sachitis Trees of Knowledge would fair better in our circumstances but still not as well as radio.
All the matters listed above are matters of practical research. It is wise to interact with customers as soon as possible in your investigation as the customer is key to any business. One last thing is not to go out there to build a case but rather go out to investigate. If you go out and your goal is to confirm a position you will almost certainly find evidence to support it. Treat research as just that, you may come across information that changes your product, embrace it.