Business Idea Generation for Management Consultants

In the second section I will show how to come up with businesses ideas if you don’t have existing business and you want to improve something already existing. In this sections we will discuss methods

• Solve your own problem

• Carve out existing business

• Cloning 1 to 1

• Idea Cloning

• Blue Ocean

• 10 x current solution using first principals

• From Free to Paid

• Ride a trend

• Disrupt others

One of the easiest way to start business is to do what you have done so far but become independent. In other words do it on your own

This method has been used in Consulting (Alvareze & Marsal, Bain) , B2C Services (Restaurants, Language Schools, Beauty salons / Hairdresser) , B2B Services (Transportation companies, Architects & Designers, Lawyers, SaaS) , E-commerce, FMCG (Puma, Nike, Yves Saint Laurent, Tom Ford)

Solving your own problem is another nice way to create a business. You know very well the customer because you are a customer as and you know the pain

Most startups when they try to create a business have to go through the following process

When you are doing products for people like you 50% of the work is done because you know intimately the customer

Let’s have a look at some examples of firms that have solved their own problem and by accident created a viable business

• Codecademy

• Airbnb

• Amazon Web Service (AWS)

• Fulfilment by Amazon

• Tesla batteries

Carving out a piece from an existing business is interesting option to build a new business. Usually you already have a customer base and ways to deliver value

Let’s have a look at some examples of businesses that were created by carving out part of the business

• Integrated Airlines

• Cars

• Domestic Appliances

• Drugs / Pharmaceuticals

• Real estate

This option becomes interesting in the following situations

• The firm is huge and inefficient

• It provides low level of service

• The firm has a high cost of delivery

• The firm has not reached economies of scales for specific part of their business

• The industry requires big investments

• High failure rate

One of the most interesting methods is simply to clone a successful business from the original market to a new market. You make almost exact copy of the original business

For Example  Alibaba is a clone of Amazon

Zalando is a clone of Zalando

Cloning 1-1 is great idea to create a business but under certain conditions

• The new market is similar to the original market

• The new market is big enough to cover the required expenses

• The new market cannot be easily accessed by the original concept

• The product requires some localization – adjustment to the new market

• The creator of the original concept is not interested in your market

• There are some serious legal barriers preventing the original concept from entering

• The original concept requires a lot of adjustments for the new market

• The original concept wants to have 1-size fits all

Some business ideas are coming from an attempt to apply famous concept to a new industry. This has produced a lot of interesting businesses and can be used in wide range of industries

This idea cloning can be described using the following formula  New Concept is Famous Formula for XYZ:

For Example Slideshare is a Youtub for Presentations.

There are 4 main ways to clone an idea using this framework

• Narrow down target group

• Change the product

• Innovative Revenue Streams

• Change Operations

Blue Ocean is a great framework that can be used to generate business ideas by observing existing industries and looking for unsatisfied customer, non-users

In the next few lectures we will have a look how to use it in practice

One of the ways to create a profitable niche is to apply the so called Blue Ocean. Here I will discuss the general framework for that

For Blue Ocean very important is the concept of non-users that are pivotal for this strategy. Here I will discuss who do they have in mind and what type of users we have

In Blue Ocean there are 4 action framework. We will discuss them in details in this lecture

You can reach Blue Ocean by taking one of the six paths. You can look across. We will discuss them in details in this lecture

In this lecture I will discuss how Blue Ocean was implemented by Starbucks

In this lecture I will discuss how Blue Ocean was implemented by Citizen M

In this lecture, I will discuss how Blue Ocean was implemented by Zappos.

One of the ways in which you can come up with new business ideas is to use the 10x framework where you resort to so-called first principles. This is the favorite method of Elon Musk

There are 3 main ways in which you can improve an existing business. This will help you come up with the proper business idea:

• Make it faster

• Make it better

• Make it cheaper

Let’s imagine that you want to drastically reduce the usage of water. Use the 10x framework to achieve this.

In this lecture, we will solve the previously introduced case study.

In this lecture, we will solve the previously introduced case study.

In this lecture, we will solve the previously introduced case study.

In this lecture, we will solve the previously introduced case study.

Let’s imagine that you are an owner of a bus company and you want to find a way to make the cost per 1 seat cheaper. Use the 10x framework

In this lecture, we will solve the previously introduced case study.

In this lecture, we will solve the previously introduced case study.

In this lecture, we will solve the previously introduced case study.

In this lecture, we will solve the previously introduced case study.

In some cases the free solution creates demand for paid products. We will discuss it in this lecture nad I will give you some examples

Trends can change something small into unstoppable beast. That’s why you can gain a lot by spotting trends early on and creating a business around the trend.

Let’s see how you can use this technique to generate business idea

• Spot a trend

• Identify people, industries that the trend will affect

• Estimate the impact of the trend

• Pick a business that will benefit from the trend

• Build the business ahead of time

When it comes to what trends to follow let’s have a look at the usual suspects

• Demographic trends

• Technology adoption

• Migration trends

• Life style trends

• Trends on the job market

• Macro trends (i.e. unemployment rate, inflation)

Many industries are ready to be disrupted. This was a huge source of business ideas in the last 15 years. There are still many industries in which this method can be used. We will discuss them in this lecture.

Let’s have a look at what conditions disrupting industries & incumbent players make sense

• Expensive workers or a big share of labor costs

• Market structure

• New technology or a process

• Low-cost business

• Lack of logic

You can learn from your own mistakes. You can also learn from other people's mistakes and turn those mistakes into a successful business.

Let’s see how you can use this technique to generate business idea

We will also look at some examples

You can learn from your own mistakes. You can also learn from other people's mistakes and turn those mistakes into a successful business.

Let’s see how you can use this technique to generate a business idea.

· Identify the mistakes

· Define what caused the mistakes

· Find solutions to problems / mistakes

· Build a business that is immune to historical mistakes

· Scale the business

In this section, I will show a powerful framework that can be used to understand the role which the product plays in the life of a customer. This will help you innovate, find new business ideas and most of all identify the right competitor landscape from the point of view of the customers.

Let’s start with a short definition of Jobs to be done

• When we buy a product we essentially hire the product to get a specific job done.

• We define the “job” as the progress that the person is trying to make in particular circumstances and area

• The very same job can be done by totally different products or services

• Therefore, don’t fall in fall with your product, and don’t look too narrowly at the competitive landscape

• Be obsessed with the problem and the job that the customer hires you to do

• The same product for the specific customer can perform different jobs in different circumstances

Let’s try to define what jobs do the coffee and Facebook

Let’s see the process that will help you understand the Job To Be Done for a specific group of customers

• Understand the Jobs to Be Done

• Define the changes to your product

• Implement the changes and adjust the organization

• Change the positioning and the messaging

• Keep Focused on the Jobs to Be Done

Let’s see the process that will help you understand the Job To Be Done for a specific group of customers

• Understand the Jobs to Be Done

• Identify who is currently doing the Job

• Create the prototype of the product

• Start selling & marketing

• Keep Focused on the Jobs to Be Done

There are 5 main ways to find the Jobs to Be Done

• Observe jobs in your own life

• Analyze non-consumption

• Analyze workarounds & compensating behaviors

• Negative jobs

• Spot unusual usage of the product

Now let's see how you can define your competitors, through the customer's lenses. We will apply the jobs-to-be-done framework.

We will define the Starbucks and Netflix competitors.

In the 4th section, I discuss a situation when you already have an existing business and you want to build an add-on business using your current business as a starting point. We will discuss numerous methods in this section as well: Go up or down the Value Chain, Vertical Consolidation via M&As, Build add-on business, Build entirely new businesses, Enabling Investments, Expand the brand into new categories,  Disrupt yourself, Use existing assets in a new way, Experiment with different sales channels & revenue streams, Turn failure into success, Repurpose a product / Find the new application to a product

If you are not satisfied with your current scaling effect you can consider going up or down the value chain. We will discuss it also this option

We will discuss here when it makes sense to expand up or down the value chain

To show you how it can be done in practice we will discuss here the example of Benefit System from Poland that has expanded in many directions it main business of operating card giving you access to fitness clubs

Another example of the successful implementation of this strategy is Zara. I will discuss it briefly in this lecture

Let’s imagine that you have to help a fitness card operator decide what will be the impact of M&A on his strategy to vertically integrate

• Fitness card operator wants to have 40% of his revenue delivered by his own fitness clubs

• He is considering 2 options: only organic growth or M&A with organic growth

• Check what will be the impact of both options on Revenues, EBITDA, and Market Cap

We will have a look at the data that you will need to solve the case study

In this lecture, we will be solving the case study.

In this lecture, we will be solving the case study.

In this lecture, we will be solving the case study.

In this lecture, we will be solving the case study.

In this lecture, we will be solving the case study.

Another way to transform the business is to gradually build an add-on business. We will start with a short intro into this technique

In this lecture, we will discuss how Amazon has been building add-on businesses using his main business as the cornerstone

In this lecture, we will discuss how WordPress has been building add-on businesses using his main business as the cornerstone

In this lecture, we will discuss how Shopify has been building add-on businesses using his main business as the cornerstone

In some cases, you have to start from scratch. You are creating a new business to deal with a problem. The new businesses open you to additional new opportunities

In many cases, your demand is limited by something that you cannot control directly. In such cases, you may be interested in enabling investments

Enabling investment can be done in different places, depending on where the bottleneck is

• Demand-side

• Supply-side

• Distribution side

Let’s have a look at how a retail chain for kids’ products can do enabling investments to support the sales of its products and in Tesla

More risk is entering totally new categories. It is doable if you have a strong brand and you pick the right categories. We will discuss it in this lecture and later on show how to do it using a nice case study

Let’s have a look at a milk producer that wants to expand its product range. In this case, you will be asked to analyze and find the best candidates for brand expansions.  

In this lecture, I will show you how to solve the case shown in the previous lectures. 

In this lecture, I will show you how to solve the case shown in the previous lectures. 

Here I will show you how to create scatter plot with labels in Excel

In this section I will show you the last strategic option you may consider. Here you decide to look for ways to disrupt yourself before somebody else does it.  I will discuss ways in which you can do it and I will show you plenty of examples of successful execution of this strategy

Sometimes when you change the business model you will not gain anything in the short term but rather protect what you have from external disruption   

One of the ways to disrupt yourself is to heavily invest in intrapreneurship. I will discuss in this lecture when it makes sense

In this lecture I will discuss how intrapreneurship was done by Google

In this lecture I will discuss how intrapreneurship was done by Apple

In this lecture I will discuss how intrapreneurship was done by 3M

If you want to disrupt yourself fast you may consider buying your biggest threat. M&A is in some cases a useful tool in disruption

In this lecture I will discuss how Altassian was buying potential competitors to defend and develop even faster

In this lecture I will discuss how Adobe was buying potential competitors to defend and develop even faster

The last way to disrupt yourself is simply to copy your main competitors, preferably do what he is doing but better and faster

In this lecture we will discuss when you have to copy your competitors

In this lecture we will discuss how Lufthansa was efficiently using this tactic and what it meant for them and their competitors

One of the ways to generate new businesses is to put to use existing assets. This is usually a pretty fast way to generate additional cash and maybe create a new business

One of the ways to generate new businesses is to put to use existing assets. This is usually a pretty fast way to generate additional cash and maybe create a new business

By changing the sales channels you can reach new customers or create different business models. Sales channels may require sometimes change in the product and your policies.

Another way to generate new businesses is to change the revenue stream. This may mean how you charge your customer and for what you charge him.

In this section, we will talk about how you can change your business by changing the model in which you claim the money from the customer. The choice of revenue streams also defines the selling model.

In this lecture on the example of a milk-based business, I will show you how your business model may differ depending on what revenue streams you will choose

Here I show when you should use the specific revenue streams. Different revenue streams are perfect for different businesses. By introducing new revenue streams you can totally disrupt your industry.

Here I show when you should use the specific revenue streams. Different revenue streams are perfect for different businesses. By introducing  new revenue streams  you can totally disrupt your industry

Ryanair has been also very creative on the revenue side. Here I will show you what revenue streams they have.

Legimi is an e-book reader bit similar to Kindle. They have been very innovative in the way they generate revenue streams

DollarShaveClub is a provider of the razor in a subscription model. They have managed t disrupt the whole industry dominated by Gillette by introducing different revenue streams

Canva is software offered as a SaaS that has been very innovative in charging. They use the freemium model and sell per piece and not in subscription

A lot of businesses are born from failure. The key is to recycle the elements that worked or can be used for another project and not penalized failure. Let's have a look at some examples.

Let’s have a look at different types of pivots

• Zoom-in Pivot

• Zoom-out Pivot

• Customer Segment Pivot

• Customer Need Pivot

• Platform Pivot

• Business Architecture Pivot

• Value Capture Pivot

• Engine of Growth Pivot

• Channel Pivot

• Technology Pivot

Let’s see how you can use this technique

• Analyze your current product

• Conduct a market and customer research

• Adjust the product if needed

• Start the sales of the new product

• Scale the business