It’s all about formulating your business idea in a simple way so everyone understands it. To do this, you need to get everyone on the same page. If people don’t understand what you’re doing, they can’t help you make it happen. You need to talk with all of your stakeholders—employees, investors, and partners—to get to the bottom of their view of the business. All of these views need to be combined and summarized in a crisp and clear business idea. One such way is as defining it as a value proposition.
A value proposition clearly communicates how your product or service will add value to your customers’ lives and how they’ll benefit from using it. It’s not enough to just say that your product is useful, because everyone claims their product is useful. You need to explain why it’s better than any other option out there. Steve Blank (credited with launching the Lean Startup Movement) suggests the following simple phrasing for your value proposition. “We help X do Y by doing Z.”
Ask stakeholders the following:
Who do we help? (X)
What do we help them with? (Y)
How do we help them do it? (Z)
Once you have gotten everyone’s thoughts and ideas down, you need to find the hidden links between the different answers. What is it that all these words have in common? What are they all saying, but saying in different ways?
Place your answers in the following equation, and you are good to go!
We help X do Y by doing Z.
Oh, and once you have completed your other purpose elements, you can fine-tune your Business Idea to become even more powerful.
Have you written down your Business Idea? Download our Purpose Worksheet and get it down on paper along with all the other purpose elements.
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