Writing a business plan is one of the most important steps in moving a new business venture into reality — but it isn’t the first step. The first step is generating a great business idea. Maybe you already have an idea that you’re planning to move from concept to reality. Or maybe your idea is almost there, but you’re not quite certain whether or not you’re heading in the right direction. Or maybe you’re still struggling to find a venture that matches your interests and abilities with a product or service solid enough to make it in the big, cold business world. Count on the following pages to fuel your idea-generating process with tips and tools for taking stock of your personal resources, asking others for advice, brainstorming ideas alone or in a group, putting your possibilities through a make-it-or-break-it reality check, and, finally, weighing the likelihood that investors, customers, and colleagues will want to buy into your business proposition.
Brainstorming Business Ideas
From technologies, to careers, to personal tastes, the world is moving faster than it’s ever moved before. The pace of change can be dizzying for sure, and it brings with it plenty of uncertainty and risk. But all that change also leads to big opportunities for visionaries who can foresee market wants and needs and respond with precisely matched product and service solutions.The next time you catch yourself saying “Why didn’t I think of that?” or “How in the world did they come up with that idea?” stop and realize that although great ideas may look lucky or random, when you look a little closer, you’re likely to find that considerable time and effort went into making them happen. To count yourself among the successful innovators, start with a brainstorm. The following sections provide you with tried-and-true methods for revving your creative engine — whether alone or in a group — and snaring great ideas for your next business venture.
Using the do-it-yourself idea blender
Humans are a creative bunch. We invented the airplane, bendable straws, computers, the sports bra, snowboards, light bulbs, the jitterbug, disposable diapers, the safety pin, and Star Wars. Motives for invention vary from person to person:
· We invent to save lives: The polio vaccine, air bags, and fat-free cheesecake
· We invent to express our deepest thoughts: Poetry, painting, filmmaking, dance, and music
· We invent just for fun: Game shows, rollerblades, and professional wrestling
The greatest thing about creativity is that no one holds the corner on great ideas. You may not become a creative genius overnight, but with a little time and effort and by following a few basic steps, you can become a lot more creative than you may have thought!Bear with this step, because you’re randomly mixing and matching based on the throw of the dice. Some of your results will combine traits you have with products you like. Some results will combine two traits. Others will bring two products or two services together. Some of the results will be new and innovative, and some will make no sense at all. Finish the exercise anyway. The process will get you thinking out of the box and allow you to see the world around you in completely new ways. Bright ideas often sound a bit peculiar when first expressed. (Think of online chat rooms and skateboards, for example. And who would’ve jumped at the notion of a pet rock?) Another thing to remember is that most creative ideas emerge by combining familiar pieces of the world around you in new and different ways (think of TV dinners and carradios, for example).Okay, not all blender concoctions are winners. “I collect art and would like to see portable bikes” is just a little weird. But, “I enjoy online travel sites and do triathlons” just may lead to the creation of a travel site for triathletes.
The two pretty good concepts that came out of this idea blender example. See how the idea blender works? After you have the hang of it, pull it out every now and then, using new personal traits and new rolls of the dice for all new possibilities. Involve friends, or turn the idea blender into an after-dinner game. Be prepared to record resulting bright ideas whenever they hit you.
THE IDEA BLENDER — YOUR BUSINESS IDEA BRAINSTORMSBrainstorm #1: An Internet emporium of specialty shops from around the world with a centralized ordering and payment system.
Brainstorm #2: A tour company specializing in travel adventures created around sporting competitions and catering to the amateur athlete.
Inspiring team creativity (with or without donuts or bagels)
Put a few heads together and you may whip up a mental hurricane. The creative outcome depends on the nature of the group of individuals you assemble (the more dynamic, inspired, and innovative, the better) and the communication skills that the session leader brings into the room.
Boost your personal creativity quotient
Where do creative ideas originate? As part of an informal survey, innovative individuals named their top idea-generating activities. The most frequently cited answers lead off the following list:
- In the shower
- Commuting
- Going to sleep
- Just waking up
- During quiet moments
- Actively thinking
- Exercising
- Meditating
- Walking
- Talking with friends
- While vacationing
- During the night
- During a business meeting
- Reading
- Sitting at the desk
- While under pressure
- Napping
- Dreaming
Identify the activities that get your creative juices going, and over the next few weeks, devote a little more time to those pursuits. Watch for a boost in your creativity as a result. The quickest way to kill an idea is to say anything akin to any of the following:
- It won’t work.
- We’re not ready for that.
- It isn’t practical.
- It’s already been done.
- That’s just plain stupid.
The group you assemble needs to remain open to all ideas presented in order to develop a healthy idea-generating environment. Applying the LCS system to nurture new ideasYou don’t want to squash brand-new ideas before they have a chance to develop, so you should react by using the three-part LCS system:
- L is for likes, as in, “What I like about your idea . . .” Begin with some positive comments to encourage people to let loose with every creative idea that comes to mind.
- C is for concerns, as in, “What concerns me about your idea . . .” Sharing concerns begins dialogue that opens up and expands the creative process. As you point out a concern, someone else in the group is likely to offer a creative solution.
- S is for suggestions, as in, “I have a few suggestions . . .” Offering suggestions moves the brainstorming session along and may lead to the generation of a brand-new set of ideas.
Assembling a brainstorming sessionWith the LCS system fresh in your brains, your group can take on a brainstorming session following these steps:
1. Start with a small group of people you trust and admire.You can turn to friends, relatives, professional acquaintances — anyone you think may contribute a new and useful perspective.
2. Invite a couple of ringers.Consider inviting a few people who can stretch the group’s thinking, challenge assumptions, and take the group in new and unexpected directions, even if these individuals may make you feel a bit uncomfortable.
3. Choose the right time and place.To inspire creativity, change the scene. Go to a park, a coffeehouse, or a hotel lobby. The same old places can lead to the same old thinking, so be inventive.
4. Establish ground rules.Explain what you want the group to achieve. Introduce the LCS system (see the previous section) so that participants have a tool that allows them to make positive contributions to the session.
5. Act as the group’s conductor.Keep the processes of moving without turning into a dictator. Use these tactics:· Encourage alternatives: How else can we do that?· Stimulate visionary thinking: What if we had no constraints?· Invite new perspectives: How would a child see this?· Ask for specifics: What exactly do you mean?· Clarify the next steps: How should we proceed on that?
6. Record the results.Designate a person to take notes throughout the session, or record the session to review later. Remember, the best ideas are often side comments, so capture the offbeat comments as well as the mainstream discussion.
7. Review your notes and thoughts while they’re still fresh. Set aside time after the brainstorming session to distill the discussion down to three or four ideas that you want to continue working on.
Transplanting a great idea
A successful business doesn’t necessarily require an original idea. A few years back, a California chef who was vacationing in Spain discovered the joy of tapas, the traditional finger food that Spaniards eat during the supper hour. On the spot, he knew that people in Los Angeles would go wild for tapas. What’s more, he knew they’d love the look and feel of the tapas bars that thrive in cities like Barcelona. He decided to import traditionalSpanish food to southern California, opening a series of tapas bars around Los Angeles and launching a U.S. dining rage.Putting your personal stamp on an existing idea can be as bold as importing an idea like tapas bars or as simple as transplanting a successful business concept into your market area — like the countless entrepreneurs who followed the California chef’s lead and opened tapas bars in cities and towns across the United States. Think about the do-it-yourself pottery painting studios that you see practically everywherethese days. The idea migrated from do-it-yourself porcelain painting, which was born out of necessity by a young housewife who reportedly couldn’t afford matching china. She decided to paint her own and wanted to help others to do the same. Entrepreneurs adapted the idea into a range of do-it-yourself pottery-painting businesses, including hobby shops; ceramics cafes; party businesses; glass, tile, and mosaic studios; and even pottery-painting books and online stores.
Finding business ideas within your work environment
A survey of 500 of the fastest-growing companies in America showed that nearly half grew directly out of the founders’ previous work environments. In other words, the founders created these companies after looking around at what they were doing and saying, “There has to be a better way to do this.” When considering new business possibilities, keep in mind that 99 percent of all businesses (both old and new) fall into one of three broad categories:
· Products for sale
· Services for hire
· Distribution and delivery
Consider the range of products that your industry offers:
· Can you think of innovative ways to make them better?
· Can you imagine a product that completely replaces them?
Consider the services that your industry offers:
· Do you notice problems with consistency?
· What isn’t being done that should be?
· What do customers complain about?
Ask yourself similar questions about your distribution and delivery systems:
· What are the most serious bottlenecks?
· Can you think of clever ways to improve distribution?
· Can you envision a radically new delivery system?
Identifying Business Opportunities
According to Thomas Edison, “Genius is 1 percent inspiration and 99 percent perspiration.” The same goes for business. Coming up with the idea through brainstorming, flashes of brilliance and industry analysis is the inspiration part. When you begin to think about how to turn it into a business, that’s when you begin to sweat.
Putting your business ideas through a first test
After some combination of brainstorming, market analysis, and a few random flashes of brilliance, you may accumulate a drawer full of promising business ideas. Following are two guidelines to help you separate the real opportunities from the fluff:
Focus on the ideas that you’re really excited about. Lifting an idea off the ground takes energy, patience, and more hours than you can begin to imagine. Your passion is what will keep you motivated on the road to success.
Pursue ideas that you can follow through on. If you feel you don’t have the means or the drive to take an idea from the drawing board to the real world, scrap it.To help you choose among your ideas, use Form 2-4 to complete a Business Opportunity Evaluation Questionnaire for each possibility you’re considering. Tally your answers and consider any idea with a score of 24 or higher worthy of serious consideration. The one exception to the scoring: If your promising idea scores high on every question except for number 3 (Is this the kind of business you really want to pursue?), it may be a great idea for someone else — but not for you. Use the Business Opportunity Evaluation Questionnaire as a first test for any business idea. If the idea scores high, it still has to pass other hurdles, but at least you know that it’s an idea worth pursuing.
Narrowing your choices
After you’ve assembled a short list of promising ventures and filled out the Business Opportunity Evaluation Questionnaire in Form 2-4 to separate the promising ideas from all the others, you need to sort a little further beforeyou select which opportunity to run with. No magic wand exists to do the work for you, but you can simplify the task by answering some questions that reveal pretty quickly whether or not an idea has what it takes to become a real, live business.Use the questions in Form 2-5 to fill in details and to flesh out some of the issues around your preliminary business propositions. If you give your answers some careful thought, they’ll reveal to you the likelihood of an idea breaking through as your winning business concept. If you find yourself struggling to come up with answers to the questions inForm 2-5, your idea may be too sketchy to evaluate. That doesn’t mean you should abandon the idea, but you should take the time to understand the opportunity more fully before taking it to the next stage in the business development process. For example, if you can’t easily describe the customer need you’re filling or how you plan to make money, you still have homework to do.
BUSINESS OPPORTUNITY EVALUATION QUESTIONNAIRE
· Describe your promising idea in two sentences.
· Being as honest as you can, rate the idea on a scale of 1 to 10: 1 being “the only thing we could come up with in a pinch,” 10 being “the best thing since sliced bread.” Circle your rating.
· Think seriously about what you would have to do to turn your idea into reality. Is this the kind of idea — and the kind of business — you really want to pursue? Rate your interest on a scale of 1 to 10 by circling the appropriate number: 1 for “so-so” and 10 for “very high.”
· Imagine sitting down and persuading an investor to put down hard-earned cash to help turn Your idea into a real business. How easy would it be to convince a skeptical outsider that· Your idea has the potential to make money? Circle your answer from 1 meaning “very difficult” to 10 meaning “a breeze.”
· Being as objective as you can, ask yourself what odds your idea has of becoming a real business venture. Rate your chances from 1, meaning “it’s a long shot,” to 10, meaning “it’s a guaranteed overnight success.”
BUSINESS OPPORTUNITY FRAMEWORK
· Describe your business opportunity in two sentences.
· List the three most important features of the product or service you propose.
· What basic customer needs does your product or service fill?
· Briefly describe who is likely to buy your product or service.
· List two or three existing products or services that already meet a similar need.
· Why would customers choose your product or service over others?
· How will you reach your customers?
· How do you plan to make money?
Doing Your First Reality Check
After you put an idea through the preliminary evaluation, expect to get hit with the gut-wrenching moment of doubt that every entrepreneur who has ever considered launching a new enterprise has experienced. Asking questions like “Is this really such a good idea?” and “Who am I kidding, anyway?” doesn’t mean you lack confidence. What it does mean is that the time has come to step back and make sure that the road you’re on is leading you where you want to go. In short, you need a reality check. In many ways, writing a business plan is a series of reality checks. By making you carefully think through every aspect of your business — from the product or service you offer to the competitors you face and the customers you serve — the business planning process brings you face-to-face with the realities of doing business. And the first step is to make sure that your preliminary plan is on track.
Getting a second opinion
To help determine whether or not you’re on solid ground, discuss your business idea and preliminary plans with a trusted friend or confidant. What you’re really seeking is a mentor with most or all of the following characteristics:
· Someone who has experience in the business area you’re considering, or at least experience in a similar business.
· Someone with the courage to tell you the truth, whether it’s “That’s a great idea. Go for it!” or “If I were you, I’d take a little more time to think this over.”
· Someone you respect and admire and from whom you can take candid criticism without feeling defensive.Consider turning to colleagues you’ve worked with in the past, teachers or professors, friends from college, or other associates.
Friends and family members sometimes can offer the advice and perspective you need, but emotional ties can get in the way of absolute honesty and objectivity. If you go this route, set some ground rules in advance. Ask for suggestions, comments, and constructive criticism and be prepared to hear both the good and the bad without taking what you hear personally. In addition to a mentor, consider designating someone to act as the devil’s advocate to guarantee that you address the flip side of every issue that you’re considering. This person’s task is to be critical of each idea on the table not in a destructive way, but in a skeptical, show-me-the-money, I’ll-believe-it-when-I-see-it kind of way.
Conducting a self-appraisal
When you prove to yourself that you’ve landed on a real business opportunity, you still have one question to answer: “Do I have what it takes to turn this opportunity into a success story?”You see some common traits among the CEOs who were multimillionaires before they turned 25 and the entrepreneurs cruising around in sports cars issuing orders on their cellphones while the value of their stock options soar: talent and hard work. To succeed, you must exhibit both, and to be a highflyer or, for that matter, to be self-employed, you need discipline, confidence, and the capacity to live with the uncertainty that’s part and parcel of being out on your own.As a first step toward appraising your strengths and weaknesses, pull out the survey in Form 2-6 and respond to the 20 statements as candidly as you possibly can. There’s no such thing as a perfect score. The point of the exercise is to identify your strongest and weakest areas so that you can capitalize and compensate accordingly. As you review your responses, watch for the following:Areas that receive “poor” ratings represent your weakest areas. Be alert for the need to compensate for these personal shortcomings.Areas that receive “excellent” ratings represent your real strengths and the personal resources you can call upon when you start your business venture.Keep in mind that not all personal strengths and weaknesses are equal contributors to business success. For example, if you plan to be a sole proprietor who works mostly alone, the ability to manage a staff doesn’t matter much, but self-motivation is absolutely essential. Or, if your business will depend on face-to-face customer service, interpersonal skills will be indispensable. As you complete Form 2-6, place a star next to the top six traits that you think are most important to the success of your business. For the moment, ignore how you rate yourself in each of those areas. If you’re weak in an important area, that doesn’t mean you don’t have what it takes to turn your idea into a business, but it does unveil areas that will require extra work and compensation on your part. For example, if you aren’t good with details, but details are important to the success of your business, this exercise alerts you to the fact that you may need to hire a personal assistant or cajole a colleague into tying up all the loose ends. Put a copy of your personal strengths and weaknesses grid into your daily organizer or post it near your computer. Having it close by constantly reminds you of who you are, the strengths you can draw on, and the areas you need to bolster as you begin the challenge of planning your business.
PERSONAL STRENGTHS AND WEAKNESSES SURVEY
Being as honest as you can, rate your abilities in the following areas:
1. Setting goals and pushing yourself to achieve them on time:Poor Fair Good Excellent
2. Making decisions and completing tasks:Poor Fair Good Excellent
3. Organizing a complex schedule and getting things done efficiently:Poor Fair Good Excellent
4. Staying focused on the specific task at hand:Poor Fair Good Excellent
5. Juggling several tasks at one time:Poor Fair Good Excellent
6. Judging a person’s character:Poor Fair Good Excellent
7. Getting along with other people and bringing out the best in them:Poor Fair Good Excellent
8. Listening to several sides of an issue and then making a decision:Poor Fair Good Excellent
9. Leading a team, even when there is disagreement among the members:Poor Fair Good Excellent
10. Understanding what motivates other people:Poor Fair Good Excellent
11. Resolving disputes among people:Poor Fair Good Excellent
12. Saying what you mean and meaning what you say:Poor Fair Good Excellent
13. Keeping your cool even when everyone else is losing theirs:Poor Fair Good Excellent
14. Telling someone no:Poor Fair Good Excellent
15. Tending to the details of a project:Poor Fair Good Excellent
16. Looking at the big picture:Poor Fair Good Excellent
17. Acting decisively under pressure:Poor Fair Good Excellent
18. Adapting to changing circumstances:Poor Fair Good Excellent
19. Taking risks:Poor Fair Good Excellent
20. Taking responsibility, even when things go wrong:Poor Fair Good Excellent
