By: Gijs van Wulfen
Mini new business cases tackle the critical uncertainties during the ideation phase so that your idea makes the best first impression to the board. Gijs van Wulfen explains how.
You can only present an idea for the first time, once! So when you have the chance to present it to your board, be aware of the fact that a new product idea is not only ‘a creative product’ but also must comply to all the regular business criteria of your organisation too. Does it have (extra) turnover potential? Does it have profit potential? Does it fit into the company’s strategy? And of course, the ‘Bob the builder’ question: Can we make it? These questions must all be answered, as far as possible, during the ideation phase of the innovation process. A common way, in management practice is the business case, where I then choose a mini variant, which complies with all uncertainties in the earliest phase of the innovation pipeline: the mini new business case.
The innovative product or service concept plays the leading role in the mini new business case, of course. The purpose of this case is to substantiate, in a businesslike and convincing manner, to what degree and for what reason the product concept can meet the set criteria.
A good mini new business case consists of six elements:
1. The customer friction (1 slide).
- The customer situation
- The customer need
- The customer friction
2. Our new product concept (1 slide).
- The customer target group (qualitative and quantitative)
- The marketing mix of the new product, service or business model
- New for…. (the world, the market, our company)
3. This makes the concept unique (1 slide).
- Buying arguments for the customer
- Current solutions and competitors.
- Our positioning.
4. It will be feasible (1 slide).
- We are able to develop it.
- We are able to produce it.
- The development process.
5. What’s in it for us (1 slide).
- The number of customers (in year three).
- The estimated turnover (in year three).
- The estimated profits (in year three).
6. Why now? (1 slide).
- Why develop it now.
- If we don’t do it, then….
7. Decision (1 slide).
- Why further.
- The follow-up team and process.
Two Practical tips
Tip 1. Don’t count every penny in calculating the turnover, cost price and profit margin. Because you can count on only one thing at this early stage: your calculation will be wrong. You just need to control the expectations from line management. In the first few years following the launch, will this product generate an annual turnover of € 100,000, € 5 million, € 25 million or € 100 million? Make a clear choice. And try to substantiate as to why one of the above options will be the likely outcome.
Tip 2. Make use of the specific expertise of all the participants in your innovation team and others from within the organisation as much as you can.
I wish you lot’s of success drafting mini new business cases in practice. Do you like more tips, formats and checklists? You can download thirteen free checklists of the FORTH innovation method here. Do you have other personal tips for innovation session facilitators? Please add them!
About the author:
Gijs van Wulfen (The Netherlands, 1960) is the founder of the FORTH innovation method. FORTH is an effective and structured method for ideating innovative products and services. The method is published in his inspiring and practical book Creating Innovative Products and Services’ (Gower, 2011).
He helps organisations to kick start innovation by facilitating the FORTH innovation method and advising companies on their innovation strategy, process and organisation. His clients are international companies in industry and services, as well as non-profit organisations in government and health. Gijs also trains facilitators in his method. His dream is to make FORTH the most used method for the front end of innovation around the world.
Gijs is a both presenter and chairman at several (international) innovation conferences, like the ISPIM Conferences and the European Conference on Creativity and Innovation. He is also founder of the yearly Dutch Innovation Conference on creating new products: ‘Nieuwe Producten Bedenken’.