Case Studies

CASE 6:  NEW BUSINESS START UP – DEVELOPING ITS VALUE PROPOSITION

Project Background:

A technical software start-up had developed a business solution geared at a specific technical sector. Given the predominately technical background of the originators they wanted to work through how to effectively exploit this as a business along with developing a plan to bring this about.

Project Objectives:

PBS was commissioned by the owners with the following brief.:

• Guide them through a process to fully understand their business opportunity
• Help them develop a business plan to practically convert their idea into a workable business.

Project Approach

As part of its methodology PBS has developed basic templates to understand the value proposition of its clients. To accomplish the first goal a simple workshop was held with the business developers to work through this template.

In this workshop we helped them work through three key areas to fully understand their idea.  These were:

What is the offering:

-           Identified what exactly the offering they had
-           The key value features of that offering

What market they sought to serve

-           The market into which they wished to sell
-           The customer characteristics within that market
-           The competitor profile

How they planned to sell to that market

-           The key selling points that applied to the market
-           The channels through which they planned to sell
-           The pricing options that existed for this market

What was the viability of it as a business

-           The cost structure behind the business
-           The revenue projections
-           The funding needs

In addition the different needs and motivations of the individuals were identified so that a common goal could be constructed for the business.

On gaining agreement on the value proposition of the business a subsequent workshop was held to go through a structured business planning process to identify a project plan that would allow them to attain their business goals.

Project Results:

On working through the value proposition some key issues were identified. These included:

• A gap existed between the owners’ perception of key value features and the unique selling points that mattered within the market. An awareness was created that they needed to sell to what the market valued as against the technical features they saw as value
• Their own knowledge of the industry they were planning on selling to was a key asset that needed to be exploited fully in their marketing approach.
• Market size within Ireland was not sufficient to achieve break-even so it was critical to their plan to achieve market share within UK. Indeed the UK needed to be their primary market.
• While the basic viability of the business was quite good, the funding requirement to break-even was identified and steps put in place to ensure adequate levels of finance were in place up front.

The benefit of the work was to create a workable and agreed joint plan with the owners.  Equally importantly, this process helped in moving the business forward and helped the owners balance the sometimes conflicting technical and business needs.