How To Prioritize Your Strategic Imperatives

In our blog post “Understanding How To Lead; From An Idea To A Fully Mature Enterprise” we described each of the four stages of development that must be completed to create a self-sustaining enterprise. We described how the strategic imperative of each stage is to get to the next stage of maturity.

A good specific strategy for a given type of business with a specific leader involves figuring out what is the smallest set of actions and resources required to progress to the next stage. As external developments can derail efforts, the best smallest set of actions and resources should have the characteristic that they have a high chance of getting the business to the next stage under challenging real world scenarios.

In this session we specifically focus on getting through the Customer Validation Stage and into the Operational Validation Stage. Later sessions will deal with the more complex analysis required to develop robust strategies for getting through the Financial Validation and Self-Sustainability Stages.

Strategizing the Customer Validation Stage

Our previous blog post outlined that the strategic imperative for stage 1 as:

“In stage one the strategic imperative—the focus of all actions—is to find, as quickly as possible, potential customers who align with what you think you know how to deliver. Strategic thinking in stage one focuses on answering these strategic questions:

• How can I best (with least effort) find real customers? This will ultimately lead to understanding who will be your customers.

• How can I make a very basic product (also known as the minimum viable product or MVP) attractive enough so some customer will actually agree to try it? This will ultimately require you to understand your value proposition, which is the same as the Fundamental Principle of Entrepreneurship: how to you make some group of people so happy they gladly give you their money in return.

• How can I deliver the MVP when I find a customer willing to try it? This will lead to understanding the initial projects and processes required to make and deliver your product.”

Sessions 2–6 coached you through how to test your idea and estimate its revenue potential, thereby giving you the parameters to answer the first question.

Sessions 7–13 coached you into understand your personal strengths and weaknesses and some of those of co-founders.

You now need to think about all the things you need to do to make a good-enough prototype to show potential customers how happy it could make them AND want to buy it. Please write down all the things that come swirling into your head in a notebook.

You may have done many or all these things already but write them down anyway, but underline or highlight on the list that remain to be done. For each required action, write down a description of what needs to be done, how it will get done, who will be doing it or be responsible for seeing it is done, where it will happen, and when it will get done. “How” may change quite a bit as you learn more, but this will get you started. If you do not know some of these answers, just put down “to be determined” or TBD.

Now consider, what will be the hardest and trickiest of these things to get done. Perhaps it is finding money to buy a critical item, perhaps it is finding somebody with specific expertise to create something for you, perhaps it is getting a permit, … whatever.

Now write down what you would need to do if that first customer LOVED your product or service and said they wanted to buy it ASAP and brag about it with their one-million followers on Instagram. Write down all the different steps you’d need to do ASAP to be able to deliver the product or service to dozens of customers or users. This gets you ready for entering Stage 2 with some momentum.

Specific to making a robust Stage 2 strategy: Which steps of getting an MVP into the hands of actual customers do you worry about setting up quickly and reliably?

What are just one or max two things that are under your control that you and your team could do that would most reliably get a marvelous MVP in front of potential customers that you could quickly start selling? This is your baseline strategy at this point.

Here are some questions to help you make this baseline strategy more robust:

• How does it focus everyone on your team towards getting that first customer. If some team members are not contributing to achieving this strategic imperative as quickly as possible, then adjust both the strategy and what your team is working on to make it so.

• List the many things that are out of your control that could cause your strategy to fail. This list would include such things as:

• a weakened economy,

• key people not being available,

• money you count on not being available, and

• competitors introducing improved products or services concurrent with showing your MVP.

• How can you adjust your strategy so that if some of the things on this list happened you still could get your MVP in the hands of potential customers: e.g., getting money in the bank account now, hiring a person instead of having them as a consultant, entice key people to work on weekends with their families helping, identifying other people with critical skills you could entice to help you on weekends or nights, etc.

• How could this strategy be explained in terms of delivering happiness and then simplified to be more exciting, inspiring and easily understood by your team and everyone you count on to help you. Test the strategy out on the people closest to you and ask how it could be made more inspiring yet simpler to explain.

Who can you ask to help you think through your lists and plans and might have some suggestions on how to make you plan more robust?

Stage 2

Stage two starts with a customer committing to use the product or service.

This stage ends when basic processes are used to deliver the product, ensure that customers are satisfied, capture new customers, and simply administrate the enterprise (i.e., pay employees, pay bills, inventory and purchase supplies, keep basic accounting records). Existing customers must be satisfied with their product to confirm the potential of the enterprise to create substantial value.

The activities of this stage are organized as at least three projects with a mission to establish processes for them: (1) delivery of the product, (2) finding and satisfying customers, (3) administrating the enterprise. Other projects may be necessary to raise money or deal with special regulatory requirements.

The mantra of the leader in stage two is “How can we make it simpler?” You want to:

• make and deliver the product as simply as possible.

• satisfy customers 24/7 as simply as possible;

• Find new customers as simply as possible;

• Find the people, contractors and suppliers you need as simply as possible;

• Pay the salaries and bills as simply as possibly.

You get the point, at this point complexity is not a competitive advantage, it is a distraction.

The key to making it through Stage 2 as quickly, simply and effectively as possible, with launching 3 or more projects going at once that each create critical processes is to: put practical, straightforward, motivated, somewhat creative people in charge of the 3 projects. These people are there to find out what it will take to deliver product, keep customers happy, find new customers and keep the lights on. One person can run two of these efforts, and that can be you. But unless the business is very small, you’ll need help from one or more people who can practically, straightforwardly and simply create and run things for the benefit of the customers.