THE CUSTOMER DEVELOPMENT ROADMAP FOR BLUE OCEAN STRATEGISTS

THE CUSTOMER DEVELOPMENT ROADMAP

FOR BLUE OCEAN STRATEGISTS

Dr. Rod Kuhn KingVisual Problem Solver, Inventor, and Magician

NEW

http://www.fundraw.com/clipart/images/00004327




Copyright 2010. Dr. Rod King. [email protected] & http://businessmodels.ning.com & http://twitter.com/RodKuhnKing

GURUS

CUSTOMER DEVELOPMENTROADMAP

(based on Steve Blank’s book: “The Four Steps

To The Epiphany”)

CUSTOMER DEVELOPMENT ROADMAPThe 4 Stages of the Customer Development Journey for a Scalable Startup

1. CUSTOMER DISCOVERY 2. CUSTOMER VALIDATION

3. CUSTOMER CREATION 4. COMPANY BUILDING

mailto:[email protected]

http://businessmodels.ning.com/

http://twitter.com/RodKuhnKing


http://www.stevenblank.com/books.html


GURUS

CUSTOMER DEVELOPMENTROADMAP

(based on Steve Blank’s book, “The Four Steps To The Epiphany”

and W. Kim & R. Mauborgne’s book,“Blue Ocean Strategy”)

CUSTOMER DEVELOPMENT ROADMAP - DetailsThe 4 Stages of the Customer Development Journey for a Scalable Startup

3. CUSTOMER CREATION

3.1 Get Ready

3.2 Position

3.3 Launch

3.4 Create Demand

1. CUSTOMER DISCOVERY1.1 State Your Hypothesis

- VISUAL AWAKENING: “As Is” Strategy Canvas (Office work)

1.2 Test “Problem” Hypothesis- VISUAL EXPLORATION: Four Actions Grid (Field work)- VISUAL STRATEGY FAIR: “To Be” Strategy Canvas- VISUAL COMMUNICATION: Comparison of Canvases

1.3 Test “Product” Hypothesis: Minimum Viable Product (MVP)- Build MVP: Prototype Ad/Headline/Web Page/Product/Service; Min. Feature Set- Test MVP- Test Hypotheses for Business Model

2. CUSTOMER VALIDATION2.1 Get Ready to Sell

2.2 Sell to “Earlyvangelists”

2.3 Develop Positioning: Product-Market Fit- Proposed Strategy Canvas (Customer Experience Curve)- Proposed Scalable Business Model

2.4 Verify - Product-Market Fit

- Scalable Business Model

4. COMPANY BUILDING

4.1 Mainstream Customers

4.2 Management/Culture Issues

4.3 Functional Departments

4.4 Fast Response Departments






GURUS

THE 2 WORLDS OFCUSTOMER DEVELOPMENT

THE 2 WORLDS OF CUSTOMER DEVELOPMENT

CUSTOMER DISCOVERY

CUSTOMER VALIDATION

CUSTOMER CREATION

COMPANY BUILDING

WORLD OF SEARCH FOR SCALABLE BUSINESS MODEL(For ‘Startups/Entrepreneurs/Founders’)

WORLD OF EXECUTION FOR SCALABLE BUSINESS MODEL(For ‘Established or Matured Companies/Accountants’)





CUSTOMER CREATION PYRAMID FORTHE BLUE OCEAN STARTUP


Delighters Satisfiers Dissatisfiers



NON-COMPETITORS(Remote Industries/Economy: Sectoral & Geographical Non-alternatives)

DIRECT COMPETITORS(Core Sector/Strategic Groups: Substitutes)

BUSINESS

(New) Customer Value Proposition/Market: …………………………………………………………………..

NON- CUSTOMERSo Profitableo Break-eveno Unprofitable

Oh My God-Product/Service

Why?How?

Why?How?

MARKET OPPORTUNITY SPACE

(LATENT DEMAND/CUSTOMERS)

UNTAPPED CUSTOMERS

SWITCHERSIM

PROVE JTBD/

Customer E

xperience

BLUE OCEAN ST

ARTUP

Why?How?

CREATE (Integrate) JT

BD/

Oh My God-Experie

ncesINDIRECT COMPETITORS (Peripheral/Adjacent Industries: Alternatives/Value Chain Complements)

Diffusion (Word-of-mouth) Potential = Delighters + Satisfiers - Dissatisfiers

GURUS

Hypotheses vs. Reality

JTBD = Job To Be Done





CORE VALUES (Incentives/Penalties)

STAKEHOLDER IMPACTS [Profit (Margin); Revenue /Cost ;

Unit Price; Volume; Speed; Trade-off]

GOALS, OBJECTIVES, STRATEGIES & TACTICS

(PLAN)

CUSTOMER PROBLEM(BIG URGENT MARKET PROBLEM:

BUMP)

RESOURCES (GLOBAL VALUE CHAIN/Bus. Model) S: Suppliers E: Employees (Core Competencies) M: Machinery/Equipment/Facility P: Processes O: Output (Product/Service) R: Retailers/Distributors/Channels C: Consumer/Customer Segments E: Environment: Competitors, etc.

COMPANY BUILDING BLUEPRINT (Version X)

MISSION/VISION

CUSTOMER VALUE PROPOSITION

GURUS






ITENN E: ENVIRONMENT

P: PROCESSES

S: SUPPLIERS/MATERIALS

R: RETAILERS/DISTRIBUTORS/ CHANNELS

O: OUTPUTS (PRODUCT/ SERVICE)

E: EMPLOYEES/KNOWLEDGE ASSETS/CULTURE

GLOBAL VALUE CHAIN:

OUTCOMES/GOALS Customer Value Proposition (Job) Business Value = Revenue/Cost Customer Value (Experience) = Customer Delight/Customer Pain

M: MACHINERY/EQUIPMENT/ FACILITY/LOCATION

C: CUSTOMERS/CONSUMERS & RELATIONSHIPS

GLOBAL VALUE CHAIN

Zoomable Elements of a Value Chain or Business Model: “SEMPORCE”GURUS






ITENN E: ENVIRONMENT/INVESTOR Revenue (Sales) Cash Burn Rate Month of Cash Left Time to Cash Flow-Breakeven Contribution Margin

P: PROCESSES Cycle Time for Pivots/Prototyping/ Versioning/Product Releases Average Time to First Order Average Time to Follow-on Order Customer Feedback/Voice



Advertising Expenses

Viral Coefficient

O: OUTPUTS (PRODUCT/ SERVICE) No. of Minimum Viable Products No. of Prototypes/Releases Average Size Order Average Selling Price per Order Web Page/Site: Total Visits; Total Page Views

E: EMPLOYEES/KNOWLEDGE ASSETS/CULTURE Agile/Lean (‘Small’) Teams Lessons Learned/Insights No. of Experiments/Interviews Effectiveness/Proficiency of Sale Person Revenue per Sale Person

CUSTOMER DEVELOPMENT DASHBOARD (CDD)

OUTCOMES/GOALS: Customer Value Proposition Business Value = Revenue/Cost Customer Value (Experience) = Customer Delight/Customer Pain


C: CUSTOMERS/CONSUMERS & RELATIONSHIPS No. of Prospects/Registrations No. of Customers/Referrals Cost per Acquisition (Paid/Net) Customer Lifetime Value Customer Loyalty/Retention: Net Promoter Score (NPS)

CUSTOMER DEVELOPMENT DASHBOARDFOR THE BLUE OCEAN STARTUP

GURUS







APPENDIX





The Blue Ocean Startup





A Blue Ocean Startup

Is a “Value Innovation” Business That

Creates an Uncontested Market Space and

Makes Competitors Irrelevant





Eventually, a Blue Ocean Startup has

a Profit Margin of, at least, 20% p.a.

not more than 3 Direct Competitors in a Fast-growing Market (Niche)

a Market Share of, at least, 3 Times That of Nearest Competitor





ORIGINAL BLUE OCEAN STARTUPS

ORIGINALBLUE OCEAN STARTUPS

GURUS




http://images.google.com/imgres?imgurl=http://www.cs.utsa.edu/~dzhu/cpsweek/microsoft_logo.jpg&imgrefurl=http://www.cs.utsa.edu/~dzhu/cpsweek/09-sponsors.htm&usg=__JnobjGIxE0uJ6GfqZMsK46wR8W4=&h=360&w=450&sz=35&hl=en&start=1&sig2=VAQURouSZt3oJpsybCf5bA&um=1&itbs=1&tbnid=MiRo0V9oQGxE8M:&tbnh=102&tbnw=127&prev=/images?q=microsoft+logo&um=1&hl=en&rlz=1T4HPNN_enUS317US317&tbs=isch:1&ei=tLmeS-7JNovyswP6xv2VCw

http://images.google.com/imgres?imgurl=http://catherineatitp.files.wordpress.com/2009/10/fedex.jpg&imgrefurl=http://www.justwhitenoise.com/?tag=visual-communication&usg=__COIRA7YYpAfZ2DuAyxWUmoor5wo=&h=273&w=917&sz=10&hl=en&start=5&sig2=tSe1nqwBdZ0daGu0y3E5Fg&um=1&itbs=1&tbnid=oHqQw8HzuMVIjM:&tbnh=44&tbnw=147&prev=/images?q=fedex+logo&um=1&hl=en&sa=N&rlz=1T4HPNN_enUS317US317&tbs=isch:1&ei=392pS7rcBaHgtAOk6cHxAQ

http://www.cisco.com/en/US/hmpgs/index.html

http://www.facebook.com/album.php?profile=1&id=33331950906

http://www.google.com/imgres?imgurl=http://www.techdigest.tv/nintendo%20logo.jpg&imgrefurl=http://www.techdigest.tv/cgi-bin/mt/mt-search.fcgi?IncludeBlogs=2&tag=Nintendo&limit=20&h=400&w=400&sz=18&tbnid=jNZuoVO-te8FJM:&tbnh=124&tbnw=124&prev=/images?q=nintendo+logo&hl=en&usg=__Dg3xSI0veDI0wzFjEvm68-9UYhY=&ei=w_P4S63qDImoNuzm4KUF&sa=X&oi=image_result&resnum=1&ct=image&ved=0CBYQ9QEwAA

http://www.google.com/imgres?imgurl=http://www.resourceondemand.com/blog/wp-content/uploads/2010/02/Salesforce-Logo-1web.jpg&imgrefurl=http://www.resourceondemand.com/blog/&usg=__pjy0N7fuMRjiAlmNHvEcw3AoV0E=&h=366&w=468&sz=64&hl=en&start=15&sig2=W1cpvcbU7xRoFhoLNjSmgg&um=1&itbs=1&tbnid=kBTEwMFMZNzwRM:&tbnh=100&tbnw=128&prev=/images?q=salesforce+logo&um=1&hl=en&sa=N&rlz=1T4HPNN_enUS317US317&tbs=isch:1&ei=6RMMTK_HDJSGNJ-t5bUE

http://en.wikipedia.org/wiki/File:Red_Bull.svg

http://en.wikipedia.org/wiki/File:JetBlue_Airways_Logo.svg

https://home.ingdirect.com/index.html


But, how are Blue Ocean Startups Created?




WHY (PROBLEMS)?

RED OCEAN Overcrowded Industries Commoditized Products/Services Similar Customer Exp. Curves Globalization Accelerated Technological Adv.

HOW MANY? HOW MUCH?

INSEAD, France (Europe) UCSI (Asia) Kimberly Clark-BOSI Many Communities of Practice for

Blue Ocean Strategy on the Web

WHAT (PROBLEMS)?

RED OCEAN (BLOODY COMPETITION) Head-to-head Competition Price Wars Shrinking Business Profit ‘Fixed’ Market Boundaries

HOW (SOLUTION)?

BLUE OCEAN (STRATEGY) Create Uncontested Market Space: ‘Category of One’ Make Competitors Irrelevant Use Value Innovation: Resolve

Cost vs. Differentiation Trade-off

WHAT NEXT?

See www.blueoceanstrategy.com

WHERE (PROBLEMS)?

Overcrowded Industries

Slow Growing/Matured Sectors

THE METHODOLOGY OFBLUE OCEAN STRATEGY

(based on W. Chan Kim & Renee Mauborgne’s book:

“Blue Ocean Strategy”)

WHEN?

See www.blueoceanstrategy.com

WHO?

W. Chan Kim & Renee Mauborgne Professors at INSEAD (France) Authors of “Blue Ocean Strategy”

OVERVIEW OF THE METHODOLOGY OF BLUE OCEAN STRATEGY

“How to Create Uncontested Market Space and Make the Competition Irrelevant”

GURUS


http://www.blueoceanstrategy.com/

http://www.blueoceanstrategy.com/





http://images.google.com/imgres?imgurl=http://knowledge.insead.edu/contents/images/KimMauborgne4_RGB.jpg&imgrefurl=http://knowledge.insead.edu/contents/BOS.cfm&usg=__JJOg9dj3lRJkXsxCNmNflhDDCQY=&h=456&w=700&sz=31&hl=en&start=1&zoom=1&itbs=1&tbnid=R40qQA8tuT3a3M:&tbnh=91&tbnw=140&prev=/images?q=blue+ocean+strategy+kim+mauborgne&hl=en&rlz=1T4HPNN_enUS317US317&tbs=isch:1

http://www.amazon.com/gp/product/1591396190/102-6272321-5520156?_encoding=UTF8&n=507846&s=books&v=glance

WHY (PROBLEMS)?

Use of Waterfall Model for Product Development

Having Little or No Customers: Product-Market Misfit

HOW MANY? HOW MUCH?

Growing Communities of Practice for Customer Development Model

Lean Startup Model

WHAT (PROBLEMS)?

9 out of 10 New Products are Failures (Unprofitable)

High Mortality Rate of Scalable Startups

HOW (SOLUTION)?

Customer Development Model (Steve Blank): Customer Discovery; Customer Validation; Customer Creation; Company Building

Lean Startup Model (Eric Ries):Continuous & Rapid Deployment

WHAT NEXT?

See http://steveblank.com/

WHERE (PROBLEMS)?

Scalable Startups especially in Silicon Valley, California

World of Business (Startups)

THE METHODOLOGY OFCUSTOMER DEVELOPMENT

(based on Steve Blank’s book: “The Four Steps

To The Epiphany”)

WHEN?

See http://steveblank.com/

WHO?

Steve Blank Retired Serial Entrepreneur Author of “The Four Steps To The Epiphany” Creator of “Customer Dev. Model” Entrepreneurship Professor

OVERVIEW OF THE METHODOLOGY OF CUSTOMER DEVELOPMENT

“Successful Strategies for Products That Win”

GURUS


http://steveblank.com/

http://steveblank.com/





http://steveblank.com/about/steve-blank4/

http://www.stevenblank.com/books.html

ITENN

GURUS


BUSINESS MODEL DEVELOPMENTTOOLS FOR SYSTEMATICALLY CREATING BLUE OCEAN STARTUPS

WISDOMSOURCING MAP(Rod King)

CUSTOMER DEVELOPMENT(Steve Blank)

BLUE OCEAN STRATEGY(W. Chan Kim & Renee Mauborgne)

Blue OceanStartup

Market Types(Customer Experience

Map)

Value Innovation

VoC

Note VoC: Voice of Customer

LEAN STARTUP(Eric Ries)





(-): PAIN

(+): DELIGHTDisruption Spot

Luxury Spot

Strategic Choice

KeyOMG-Experience:

Undesirable Experience:

Profit Margin

No. of Direct Competitors(Level of Commoditization)

Blue Ocean(“Practical Impossibility”)

Luxury Spot

Disruption Spot

Green Ocean Red Ocean

JOURNEY OF

THE BLUE OCEAN STARTUP

3

100%

6

10%

20%

10 (Global)

BLUE

OCE

AN ST

ARTU

P





http://www.facebook.com/home.php?ref=logo

(-): PAIN


Luxury Spot

Strategic Choice

Profit Margin

No. of Direct Competitors(Level of Commoditization)

COMPANY BUILDING COMPANY SCALING/ACQUISITION

CUSTOMER CREATION

CUSTOMER DISCOVERY & VALIDATION

‘CUSTOMER DEVELOPMENT’ JOURNEY OF

THE BLUE OCEAN STARTUP

3

100%

6

10%

20%

10 (Global)

BLUE

OCE

AN ST

ARTU

P






(-): PAIN


Luxury Spot

Strategic Choice

KeyOMG-Experience:


GURUS

Sweet SpotSTARTUP

Blue Ocean STARTUP

(“Practical Impossibility;Value Innovation”)

Luxury SpotSTARTUP

(“Existing Market”)

Disruption Spot/Lean STARTUP

(“Resegmented/Reframed Market; Lean/No-frills Niche”)

VolcanoSTARTUP

OasisSTARTUP

Green OceanSTARTUP

Red OceanSTARTUP

No-Man’s-IslandSTARTUP

3

10

6

3

6

10

Ideal Value Space(Ideal Market/Ideal Impossibility/Ideal Tool/Ideal Universe/New MarketSTARTUP)


10 ARCHETYPAL STARTUPS & MARKET TYPES “What Kind of a Startup Are We? What Kind of a Startup Must We Be? How?”

Differentiation(Performance)

Cost






(-): PAIN


Luxury Spot

Strategic Choice

Resegmented/Reframed/Low-cost

Market; Lean/No-frills Niche

Cost(Adoption Barrier; Complexity; Inaccessibility; Delay)

Existing High end-Market

Performance(Functionality;Quality;Differentiation)

KeyOMG-Experience:


GURUS Cost-Performance Map for ‘Market Types’ Collaboratively Design Oh My God-Vision, Strategies, Products, Services, and Business Models

Market Segment (Customer Problem/Goal): ………………………………………………………

Ideal Value Space(Ideal Market/Ideal Impossibility/Ideal Tool/Ideal Universe/Entirely New Market)


3

10

6

3

6

10

Blue Ocean Strategy

(“Value Innovation”)







• Competitors/Industry/Economy• Partners/Complementors• Investors/Board of Directors• Public/Society/Enemies/Non-customer• Government/NGOs/Environment

P: PROCESSES

• Preparing/Searching/Discovering• Purchasing/Leasing• Receiving/Delivering/Learning/Installing• Using/Sharing/Complementing• Maintaining/Storing/Managing/Disposing

S: SUPPLIERS/MATERIAL


GLOBAL VALUE CHAIN(PERFORMANCE DASHBOARD)

OUTCOMES/GOALS Customer Value Proposition (Job) Business Value = Revenue/Cost Customer Value (Experience) = Customer Delight/Customer Pain


C: CUSTOMERS & CONSUMERS RELATIONSHIPS Core Customers/Users/Influencers

Peripheral Customers/Users/Influ.

Remote Customers/Users/Influ.

GENERIC ELEMENTS OF GLOBAL VALUE CHAIN

Collaboratively List, Sketch, Organize, and/or Manage Metrics for Elements of Value ChainGURUS

R: RETAILERS/DISTRIBUTORS/ CHANNELS Retailers/Distributors/Channels Place/Warehousing/Location Promotion/Buzz Branding/Marketing Advertising Selling/Relationship Management

O: OUTPUTS (PRODUCT/ SERVICE) Product/Service Pricing Packaging Display Design Plan







Key Partners (KP)

P: PROCESSES

Key Activities (KA)


Key Resources (KR) – Suppliers


Channels (CH)


Key Resources (KR) – Product/ Service


Key Resources (KR) – Employees

GLOBAL VALUE CHAINFOR “BUSINESS MODEL

CANVAS”: GOALS Customer Value Proposition (VP) Revenue Streams (R$) Cost Structure (C$)


Key Resources (KR) – Machinery


Customer Segments (CS)

Customer Relationships (CR)

GLOBAL VALUE CHAIN FOR “BUSINESS MODEL CANVAS”

Visually Observe Similarities and Differences Between Global Value Chain & Business Model Canvas

GURUS






ITENN E: ENVIRONMENT Key Partners (KP) Record Companies Original Equipment Manufactur- ers (OEMs)

P: PROCESSES Key Activities (KA): Hardware Design Software Design Marketing


Key Resources (KR) – Suppliers


Channels (CH) iTunes Store www.apple.com Apple Stores Selected Retail Stores


Key Resources (KR) – Product/ Service iPod Hardware iTunes Software Content & Agreements


Key Resources (KR) – Employees Staff Apple Brand

APPLE INC.: iPod (2001) Customer Value Proposition (VP): “A Thousand Songs in Your Pocket” Revenue Streams (R$): iPod Hard- ware; iTunes Store; Commissions Cost Structure (C$): Employees; Manufacturing; Marketing & Sales


Key Resources (KR) – Machinery


Customer Segments (CS) Luxury Spot; Mass Market Customer Relationships (CR) “Lovemark” Switching Costs

GLOBAL VALUE CHAIN FOR APPLE INC.: iPod

Visually Observe Similarities and Differences Between Global Value Chain & Business Model Canvas

GURUS


http://www.apple.com/




http://www.google.com/imgres?imgurl=http://images.businessweek.com/ss/06/05/phaidon/image/11_979-ipod.jpg&imgrefurl=http://images.businessweek.com/ss/06/05/phaidon/source/12.htm&usg=__5UwlmeQQeGhKtohDaLcX7qSF-oA=&h=309&w=440&sz=20&hl=en&start=1&zoom=1&um=1&itbs=1&tbnid=noESIJ-yrxi9CM:&tbnh=89&tbnw=127&prev=/images?q=ipod+2001&um=1&hl=en&rlz=1T4HPNN_enUS317US317&tbs=isch:1

FOCUS “PIVOT” PROCESS: VALUE INNOVATION TACTICS (What if … E.R.I.C.?) OUTCOME:FUTURE(DISRUPTIVE)BUS. MODEL

BUSINESS/GLOBAL VALUE CHAIN

GIVEN BUSINESS MODEL

E:Eliminate

R: Reduce/Replace

I: Increase

C: Create

INPUT (SUPPLIERS/ MATERIALS/ENERGY)

ELEMENTS(EMPLOYEES/MACHINERY)

Staff/Apple Brand

PROCESS(Bus. Process/ Strategies)

Hardware Design/ Software Design/Marketing

OUTPUTS:PRODUCT/SERVICE

iPod Hardware/ iTunes Software/Content & Agreements

RETAILERS/DISTRIB./CHANNELS

iTunes; apple.com; Apple Stores/Others

CONSUMERS/CUSTOMERS (Experience)

Luxury Spot/Mass Market

ENVIRONMENT - COMPETITORS (Industry)- PARTNERS (Complementors)- INVESTORS (Revenue/Cost)- PUBLIC/SOCIETY/Enemies- GOVERNMENT/NGOs

Record Companies/Original Equipment Manufacturers (OEMs)/…

BUSINESS MODEL PIVOT FOR APPLE INC.: iPod - 2001 Collaboratively Design Oh My God-Vision, Strategies, Products, Services, and Business Models

SYST

EM

(IND

UST

RY/B

USI

NES

S)GURUS

Market Segment (Customer Problem): ‘Fragmented’ Music ExperienceMission/Vision: “… Apple leads the digital music revolution. …”


HYPOTHESES PROBLEMS/PAIN (WEAKNESS-ES/THREATS)

GOALS/Objectives/Strategies/Tactics/ Initiatives/Projects

Key Metrics/ Performance Indicators/Targets

Business Experiences (Impacts)

Description of BUSINESS/GLOBAL VALUE CHAIN

Delight(Revenue)

Pain(Cost)

S: Suppliers

E: Employees/ Knowledge Assets

Staff/Apple Brand/

Staffing Cost

M: Machinery/ Infrastructure


P: Processes MarketingSales

Marketing CostSales Cost

O: Outputs(Product/Service)


R: Retailers/ Distributors/Channels

iTunes; apple.com;Apple Stores/Other Retailers

C: Consumers/Customers

Luxury Spot/Mass Market

High Revenue (Hardware)

E: Environment Record Companies/Original Equipment Manufacturers (OEMs)/…

Commissions

VALUE CHAIN(“SEMPORCE”)

BUSINESS ECOSYSTEM

Customer Value Proposition:“A Thousand Songs in Your Pocket”

BUSINESS VALUE(PROFIT MARGIN)

BUSINESS MODEL PLAN FOR APPLE INC.: iPod - 2001 Collaboratively Design Oh My God-Vision, Strategies, Products, Services, and Business Models

GURUS

Mission/Vision: “… Apple leads the digital music revolution. …” Market Segment (Customer Problem): ‘Fragmented’ Music Experience


ITENN2001

Nike’s PSA Play120 (for customers who workout; has armband) Apple iPod (5GB; seamless inte- gration with iTunes music library for use on Mac computers)

2002

Apple iPod (20GB; Windows compatibility; iTunes Music Store)

1998

Eiger Labs releases MP3 player: - MPMan F10 (Flash drive capacity of 32MB) - Diamond Rio PMP300 (32MB Capacity)

2006

Mainstream popularity of Music- phones

2007

Apple iPhone (Multi-touch screen; etc.)

Apple iPod Touch Phone (Multi- touch screen; etc.)

1999

Release of Sensory Science Rave MP 2100 (64MB; voice recorder; FM tuner) Creative Labs’ Nomad (docking) PJB-100 (Internal hard disk: 4.8GB)

EVOLUTION OFTHE DIGITAL MUSIC PLAYER

2000

I2Go eGo (Micro-drive: 2GB; pocket size; high price) Creative Labs’ Nomad Jukebox (6GB; clunky; high quality sound)

2005

Apple iPod (60GB; color screen)

Emerging popularity of music – telephones: Motorola; Samsung; LG; Nokia; Sony Ericksson

GURUS


EVOLUTION OF THE DIGITAL MUSIC PLAYER





IMPACTS

SYSTEM

VOICE OF THE CUSTOMER IN CORE & PERIPHERAL INDUSTRIES: Hypotheses vs. Reality

CUSTOMER DELIGHT (+) CUSTOMER PAIN (-)

Decision Criteria:Needs & Barriers COMPETITORS

Function/Content/Perf/Knowledge

Quality/ Reliability/Accuracy/Efficiency

Brand/Emotion/Style/Aura/Prestige

Customization/ Personalization/Interactivity/Fun/Entertain.

Cost (Price)

Inaccessibility/Unavailability/ Inflexibility/Friction/Scale

Complexity/ Difficulty/Support/Range/Risk

Process Time/Delay/Age

IMPORTANCE

Given Product:iPod Nano

Hold 1,000 songs (4 GB)

Watch Photos/Video

High quality Apple Brand Color

Capacity Choice

$149 Pocketable

No Wireless Connection

Simple to use

Store-Service Support

24hr Music Playback

CORECOMPETI-TORS:iPod Shuffle

Hold 240 songs (1 GB)


Capacity Choice

$79 Ultra-pocketable


Simple to use


12hr Music Playback

PERIPHERALCOMPETITORSiPod Classic


Watch Photos/Video


Capacity Choice

$249 Pocketable


Simple to use


40hr Music Playback

REMOTECOMPETI-TORS:iPod Touch

Hold 1,750 songs (8 GB);Watch Video/ Photos; Multi-touch Screen


Capacity Choice

Multi-touch Screen

$299 Pocketable

Wi-Fi Connection

Simple to use


22hr Music Playback

CUSTOMER EXPERIENCE OF COMPETITORS FOR APPLE’S IPOD NANOGURUS

Market Segment (Customer Problem/Goal): Listen to Music/View Photos/Watch Videos/Manage Personal Info’

Mission/Vision: “… Apple leads the digital music revolution. …”

http://www.google.com/imgres?imgurl=http://scratchprotection.affiliatestoreonline.com/img/1/1053.jpg&imgrefurl=http://scratchprotection.affiliatestoreonline.com/product/1/677/Apple-Ipod-Shuffle-1st-Gen-Full-Body-Scratch-Protection-Invisibleshield-By-Zagg.html&usg=__j0fImvOqbEzDHxE5zyBtaLQR9LY=&h=300&w=300&sz=18&hl=en&start=22&zoom=1&um=1&itbs=1&tbnid=7-cwzo9E0eCAjM:&tbnh=116&tbnw=116&prev=/images?q=ipod+shuffle+apple&start=20&um=1&hl=en&sa=N&rlz=1T4HPNN_enUS317US317&ndsp=20&tbs=isch:1

http://www.google.com/imgres?imgurl=http://www.kendyck.com/wp-content/uploads/2007/06/ipod-nano-pink.png&imgrefurl=http://www.kendyck.com/archives/2007/06/16/end-breast-cancer-win-an-ipod-nano/&usg=__6R_OidSv86dnw3-XNBlWLi4xDDc=&h=548&w=442&sz=106&hl=en&start=8&zoom=1&um=1&itbs=1&tbnid=6lGVI2SuQzVZ6M:&tbnh=133&tbnw=107&prev=/images?q=ipod+nano&um=1&hl=en&sa=N&rlz=1T4HPNN_enUS317US317&tbs=isch:1

http://en.wikipedia.org/wiki/File:6G_iPod.svg

http://images.google.com/imgres?imgurl=http://files.lesterchan.net/images/apple/ipod_touch.jpg&imgrefurl=http://lesterchan.net/blog/2008/02/18/apple-ipod-touch-8gb-or-asus-eee-4g/&usg=__dSYHyxeIaubZc3nfsKd-RbosPyA=&h=414&w=293&sz=24&hl=en&start=1&zoom=1&itbs=1&tbnid=l9KXgly4NBBp-M:&tbnh=125&tbnw=88&prev=/images?q=ipod+touch&hl=en&rlz=1T4HPNN_enUS317US317&tbs=isch:1

IMPACTS

SYSTEM



Decision Criteria:Needs & Barriers CURVES

Function/Content/Perf./ Knowledge


Brand/Emotion/Style/Aura/Prestige


Cost (Price)




WEIGHT (IMPORTANCE)



High quality Apple Brand Color/Capacity Choice

$149 Pocketable/No Wireless

Simple to use/Store-Service

24hr Music Playback

CUSTOMER EXPERIENCECURVES

10

8

6

4

2

0

CUSTOMER EXPERIENCE CURVES FOR APPLE’S IPOD NANO How to Zoom In and Out of BUMPs in Core & Peripheral Industries?

KEY -> 1: Low level; 10: Extraordinary level of customer experience

iPod Nano “iPod Shuffle “iPod Classic

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IMPACTS

SYSTEM



Decision Criteria:Needs & Barriers TACTICS

Function/Content/Perf./ Knowledge


Brand/Emotion/Style/AuraPrestige


Cost (Price)




WEIGHT (IMPORTANCE)


6 8 8.5 2 7 6 3 8

Core Compet.iPod Shuffle

5 8 8.5 2 4 6 2 5

Peripheral Compet.iPod Classic

8.5 8.5 8.5 6 9 6 4 9

E: Eliminate

R: Reduce

I: Increase Screen SizeStorage

Quality of Sound

FunEntertainment

Price ThicknessWeight

C: Create Multi-touch Screen

Digital Media Hub

Wi-Fi Multi-touchNavigation

CUSTOMER EXPERIENCE TACTICS FOR APPLE’S IPOD NANO Collaboratively Design Oh My God-Vision, Strategies, Products, Services, and Business Models

GURUS




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http://en.wikipedia.org/wiki/File:6G_iPod.svg

FOCUS “PIVOT” PROCESS: VALUE INNOVATION TACTICS (What if … E.R.I.C.?) OUTCOME:FUTURE(DISRUPTIVE)BUS. MODEL

BUSINESS/GLOBAL VALUE CHAIN

GIVEN BUSINESS MODEL

E:Eliminate

R: Reduce/Replace

I: Increase

C: Create

INPUT (SUPPLIERS/ MATERIALS/ENERGY)

ELEMENTS(EMPLOYEES/MACHINERY)

Staff/Apple Brand

PROCESS(Bus. Process/ Strategies)


OUTPUTS:PRODUCT/SERVICE


Screen Size; Storage;Fun; Entertainment;Thickness; Weight;Price

Multi-touch screen; Digital Media Hub;Wi-Fi

RETAILERS/DISTRIB./CHANNELS

iTunes; apple.com; Apple Stores/Others

CONSUMERS/CUSTOMERS (Experience)

Mass Market

ENVIRONMENT - COMPETITORS (Industry)- PARTNERS (Complementors)- INVESTORS (Revenue/Cost)- PUBLIC/SOCIETY/Enemies- GOVERNMENT/NGOs

Record Companies/Original Equipment Manufacturers (OEMs)/…

BUSINESS MODEL PIVOT FOR APPLE INC.: iPod - 2001 Collaboratively Design Oh My God-Vision, Strategies, Products, Services, and Business Models

SYST

EM

(IND

UST

RY/B

USI

NES

S)GURUS

Market Segment (Customer Problem): Commoditized ProductsMission/Vision: “… Apple leads the digital music revolution. …”

http://images.google.com/imgres?imgurl=http://files.lesterchan.net/images/apple/ipod_touch.jpg&imgrefurl=http://lesterchan.net/blog/2008/02/18/apple-ipod-touch-8gb-or-asus-eee-4g/&usg=__dSYHyxeIaubZc3nfsKd-RbosPyA=&h=414&w=293&sz=24&hl=en&start=1&zoom=1&itbs=1&tbnid=l9KXgly4NBBp-M:&tbnh=125&tbnw=88&prev=/images?q=ipod+touch&hl=en&rlz=1T4HPNN_enUS317US317&tbs=isch:1


ITENN4 PART-WISDOMSOURCING MAP 5 PART-WISDOMSOURCING MAP

1 PART-WISDOMSOURCING MAP

CLASSIC VERTICAL MAP PAIN-DELIGHT MAP


WISDOMSOURCING MAPS:

Family of Wisdomsourcing Maps (Zoomable Idea Organizers) for Facilitating Collaboration, Ideas

Management, Creativity, and Customer Problem Solving


CLASSIC HORIZONTAL MAP

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WISDOMSOURCING MAPS FOR THE BLUE OCEAN STARTUP

Visually Facilitate Collaboration, Ideas Management, Creativity, and Customer Problem Solving





ABOUT THE AUTHOR

GURUS





Inventor of over 40 Tools for The Wisdomsourcing Trilogy – Facilitating work in the areas of Business Model Development Business and Strategic Planning Product & Service Innovation Performance Management

Inventor of “The Fractal Grid”This technology, which has US andInternational patent-pending, can beused for visually organizing and Prioritizing massive amounts of information such as in search engines, social networks, andother communities on the Internet

Visual Problem Solver Speaker & Consultant on

Business Model Development Inventor of The Wisdomsourcing

Trilogy, a Customer Problem Solv-ing Suite for Collaboratively Designing Oh My God-Strategies, Products, and Business Models

Founder of the WisdomsourcingGroup, an online Global Think Tankfor collaboratively improvingcustomer experiences and resolvingtough dilemmasOrganizer & Coordinator of Wisdom-sourcing survey involving over 200 professionals from over 30 countries

CONTACT

Dr. Rod King: California, USACell: (559) 248-6230

[email protected]://twitter.com/RodKuhnKing

B. Eng. (Hons) in Civil Eng. Master of Infrastructure Planning Ph.D. in Regional Dev. Planning Postgraduate Certificate in

Advanced Academic Studies Over 20 years of experience in

creative problem solving formulti-disciplinary projects

Dr. Rod KingVisual Problem Solver,

Inventor & Magician Inventor of first software that

wholly invents magic tricks Inventor of several magic tricks Author of “Trickanalyzing the

Close-up Magic of David Copperfield” & several articles

Winner of several championships in chess and table-tennis

Founder and former CEO of Galaxy IT, Inc., a venture-financed visual search engine business

Major contributor on creativity to the multi-author book, “Research Methods for Postgraduates”

Former Lecturer

BIOGRAPHICAL SKETCH Background Information on Dr. Rod King, Creator of Business Model Development (BMD)

GURUS




• Rod King (2009)• Global Collaboration• Visual Problem Solving• Practical Impossibility Thinking• Wisdomsourcing Maps• Wisdomsourcing Canvas• Customer Experience Map (Pain-Delight Evaluation of Trade-off)• Wisdomsourcing Deck• Manifesto for Wisdomsourcing Game

• Alex Osborne (1953)• Rules for Brainstorming – No criticism during idea generation• ‘Blue Sky’ Thinking and Ideas

• Jeff Howe (2006)• Crowdsourced Goods and Information Products• Off-site Tools for Strategic Analysis and ProblemSolving

• ‘Ad hoc’ Group• Unlimited Number of Volunteers• Peer Production; Documentation• Open Innovation and Value Chain• Prosumers: Consumers who participate like employees/producer in a business• Competitions; Contests; Prizes• Recognition; Reputation

• Organic Process• Online Collaboration• Collaborative Idea Generation• 1D-Evaluation; Voting

• Myriad Generated Ideas

• Offline• 1 Physical Location• Formal Group

WISDOMSOURCING3.

CROWDSOURCING 2.

1.BRAINSTORMING

EVOLUTION OF WISDOMSOURCINGGURUS





THE CUSTOMER DEVELOPMENT ROADMAP FOR BLUE OCEAN STRATEGISTS

Business

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