I once knew a guy who spent every last dime trying to get auto companies to buy his “hubcap” locks for expensive spoked wheels. They repeatedly turned him down. He took his idea to the insurance companies and…”poof!” He struck it big.
David Ronick’s article, 10 Steps from Idea to Business tries to lay out a path to success in 10 steps. I applaud David in trying to help all those who want to be entrepenuers, but the steps can lead one in a direction that may not bear fruit.
1. Come up with an idea-David basically says to brainstorm for a good idea. The problem with this is “what is a good idea?”
2. Think through all angles- David has the right idea, but most people are not equipped to do this. Take for example, Jim Collins in Good to Great. He preaches his three concentric circles. Or, Kim and Mauborgne’s The Blue Ocean Strategy, where they lay out the idea of a product that renders competition virtually irrelevant. A “rough business plan” will not substitute for a well thoughtout strategic plan. Most people can’t do that, and have to hire a strategist to help them with it.
3. Get feedback–This is always good advice, but from who? If you are new to the market, you will most likely not be able to get to the right people. And what about them stealing your idea? This step is hard, so you will have to do your own research. The internet is a good place to start.
4. Respond to feedback–Again, I can’t see this step, or the other steps working because you would not get past step three. This is where so many businesses fail because they live off a dream and don’t do their basic research.
5. Build a basic product–Will you have an inventory? Read Chris Anderson’s The Long Tail. You might have second thoughts about your dream.
6. Open shop–As a newbee, can you manage your shop? Read Les McKeown’s Predictable Success. The book may paint an unflattering picture of where your company is in its life cycle.
7. Test what you’ve created–Have you developed a disruptive technology in your market? The Innovator’s Dilemma by Clayton Christensen explains what this means and how companies used it to become great.
8. Make adjustments
9. Get ready to grow–Collins and Porras’s book, Built to Last can open you eyes as to what makes a susainable business.
10. Stomp on the startup accelerator
My response is not meant to kill any good idea that you may have. Instead, I have listed major strategy books written by authors who have studied hundreds of successful and unsuccessful businesses. Read them, and others before entering step two, above. The more you know about a successful business, the more you will be able to leverage their experiences to make your dream a reality.