Will Your Customer Value Proposition Fail?
Whether you are an Entrepreneur with a new idea or an Enterprise organisation with an idea for a new revenue stream, your Customer Value Proposition is key to your success. There are lots of great tools now available to help build the Value Proposition such as the Disciplined Entrepreneurship and the Value Proposition Canvas. However, there is one consistent problem we see that is largely ignored, which ultimately causes more failures, lost revenue, market traction and revenue than any other, and this is the Validation of the Customer Value Proposition. Your Customer Value Proposition starts off as a list of assumptions that must be validated and without proper validation these assumptions remain exactly that – assumptions. So if Validation is one of the most important steps in building your Customer Value Proposition why is the Validation either not completed or only part completed.
Why Validation of the Customer Value Proposition Fails
Every Enterprise is under pressure to get products and services to market and Entrepreneurs are no different. Time pressure may come internally from fellow stakeholders in the organisation or externally from other stakeholders such as Investors. Entrepreneurship can also be an exciting roller coaster of emotions and often the Entrepreneurs passion, enthusiasm and excitement can lead people to skip or at least give a “light touch” to certain steps in the Business Model canvas and the wider Disciplined Entrepreneurship programme as they look to save time. Most Entrepreneurs are juggling multiple roles and responsibilities, hence it is only natural that something may have to give and unfortunately it’s often the Validation process.
The Validation process will invariable cost the organisation money, which at a time when many businesses may be Pre- Revenue is sometimes difficult to justify. Furthermore due to financial pressures a conflict can often arise between the most effective Validation programmes (Quality) and the least expensive Validation programmes (Price) – in short, in business we rarely get Quality at the best Price. Often at the start of any Entrepreneurs business journey they understandably have a mind-set of financial survival and there can be a reluctance to spend money when they don’t believe they need to.
3. Being Right
Every human being has a natural desire to being right. Having external people challenge our ideas can be difficult for any Entrepreneur or Business Lead to accept. It can be difficult to accept that external people without the Entrepreneurs or Enterprises expertise or insight, could have any form of valid contribution. This problem leads to the owner of the Customer Value Proposition either ignoring feedback or misinterpreting the feedback in favour of the original assumptions in the Customer Value Proposition.
If the Customer Value Proposition is correctly constructed and the teachings in Disciplined Entrepreneurship and the Value Proposition Canvas, are followed correctly, then every Value Proposition would either be a success or it would not pass the initial validation process, and be shelved or at least modified. The fact the majority of Value Propositions fail must then be connected to the Validation process – or is it Execution where the problem lies?
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