Five Important Questions Entrepreneurs Need to Ask

To launch your own great idea, you need to be able to answer these questions.

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Most of us, when we get what we think of as a stable job, effectively plug into a solution someone else has devised, taken to market and brought to scale. We hire ourselves out on behalf of solutions for which someone else has found avid users, early backers and paying customers.

But at the present pace of global change, today's solution is tomorrow's problem. In my previous post, I assert that, due to accelerating rates of change in the way we live, the tools we use and the structure of global markets, it is increasingly risky to assume that existing solutions will provide stable sources of employment.

In view of this, I argue, an increasing proportion of us needs to learn to build out solutions ourselves, whether as entrepreneurs or on behalf of our employers, in order to help them stay relevant and keep our paychecks coming.

This requires that we learn to think and operate in a way that is unfamiliar to many of us who have been rewarded, throughout our education and our professional lives, for more or less doing what we're told, in the way we've been told to do it.

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To help aspiring entrepreneurs and corporate innovators learn this unfamiliar mode of thinking and operating, I use a set of questions. These questions reflect an approach my partners and I have developed through extensive work with entrepreneurs and corporate innovators over time.

In my experience, these questions are remarkably effective in helping individuals and teams achieve the kind of transformation I describe in my previous post. This is the transformation from employees and managers qualified to execute or optimize existing solutions to agents of practical creativity, equipped to identify changing problems and needs, and to effect solutions in practice.

In their simplest form, these questions are:

  1. What should work differently – and what would make it work better?
  2. How are markets and needs changing – and how can we make the most of this in developing our solutions? How will we know if change is occurring along the lines we predicted? How can we prepare for alternatives and adjust our plans in order to get ahead of emerging change?
  3. What are the best competing solutions? What are existing attempts to close the gap between how things work and how they should? Which attempts have failed and why? Which emerging solutions have the greatest potential, and what would it take to get considered alongside them by customers – and chosen over them? 
  4. How can our solution be commercialized in practice? What will it involve to produce and monetize the solution? How can we test the market to learn more about what will be required? How do we need to refine the solution to take into account the challenges of launching and growing it in practice?
  5. Why should others get involved? Why is it worth their while to help get the solution off the ground, through investing critical time, money, resources and relationships early on?
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    The first two questions are, in many ways, exercises in imagination. When we ask them, we envision what might work differently, and what shape existing waves of change will take.

    Question 1 is typically fun. Think of something that should just work differently. It can be in society, in industry or in everyday life. Something for which, every time you do it or see it or read about it, you know there's a better way. This can be a source of frustration for those involved in a specific activity, an impediment to efficiency for an industry, or a constraint on how millions live their lives. What is it? What might work better? 

    Question 2 involves what for many is an unfamiliar way of thinking, because it explores changes that are latent in today's market, but have yet to fully take shape. If a solution addresses only needs people already know they have, chances are, it's a bit late to be developing it. The key here, as I describe in "How Companies Today Can Anticipate the Technology of Tomorrow," is to identify emerging waves of change before they crest. These waves of change can open up major innovation opportunities – and can also kill what appear to be persuasive solutions.

    Once we have envisioned how things should work differently and how our solution is affected by emerging changes in the marketplace, the next challenge is to consider how to pull it off. Questions three, four and five focus on this. When we ask these questions, we examine competing solutions, consider what would be required to take our solution to market and how we should refine it in view of this, and kick the tires hard so we can credibly persuade others why it's worth their while to help us.

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    This requires confronting imagination with practicality in ways few of us are trained to do, either as individuals or through bringing together contrasting perspectives on teams. Doing this can be challenging at first. Yet it is frequently where the magic happens. Often it's after innovators look at the market, the logistics, the economics, and the help they will need – and go back to the drawing board – that really good solutions begin to emerge.

    In my subsequent post, I will focus on the kinds of thinking involved in answering Question 2 effectively. Think of something you didn't know you needed until you saw it (or until your friends or coworkers started using it), and now can't live without. The second question is about identifying intense needs that remain unmet until we see the solution.

    It's also about recognizing and capturing value left dangling when markets, industries and user behavior undergo seismic shifts. I give examples of this in my posts "Why iTunes Works," "Why Google's Business Model Works," and "How Amazon Won."  These companies are major players, of course, but they were upstarts when they made key innovations – and even the most storied corporate innovators need to renew the sources of their success.

    In many ways, Question 2 critically informs all the others. It separates the active, dynamic process involved in asking these five questions, from the static exercise in blue sky predictions typical of writing a traditional business plan – an exercise that many investors have come to consider virtually useless. Innovators who learn to answer these questions begin to operate under the assumption that everything is changing, and to think in a structured and iterative way about the direction and implications of shifts coming into view in the landscape before them.

    Alejandro Crawford is a senior consultant at Acceleration Group. He teaches innovation, growth and digital strategy at NYU's Polytechnic Institute and Baruch's Zicklin School of Business. He graduated from the Tuck School of Business in 2003.

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