entreSociety

Building an entrepreneurial society

Archive for the month “October, 2013”

How to look at innovation from a user’s viewpoint

When we are developing ideas for innovation we often identify opportunities in isolated situations.  We need to put ourselves in the shoes of the end user and determine how they might make the decision whether to use our product or not.

For example, I worked with a group of entrepreneurs trying to decide how to apply wireless technology and sensors in a hospital environment.  There are a multitude of opportunities for this application in hospitals.  We set out describing a number of possibilities as though none of those solutions currently existed.  In fact there were quite a number of these concepts already available or in development.  What was needed was a way to identify gaps or opportunities to link solutions together.

What we should have done was to look from the perspective of a user in the hospital eco-system perspective and determine what they needed to do, what solutions were currently available or in development and what gaps existed.  Using this approach would create opportunities for applications but would also identify how they fit into the overall solution and who we could work with in getting adoption.

This approach might also enable us to become a distribution channel for solutions that are having a difficult time fitting into the current structure.  A combination of individual solutions taken together in an infrastructure could have a greater chance of success than any of the individual solutions.

As Clayton Christensen has pointed out, people hire products and services to do jobs.  If we look closely at those jobs and the people doing them we start to understand where opportunities lie and how to develop solutions.  This analysis also helps us to find our early adopters and product champions because they need the solution the most.

When big companies don’t innovate entrepreneurs need to

There are some unusual paradoxes taking place in the world these days.  We see massive unemployment and underemployment coupled with big companies making big profits and build up piles of cash.  But they aren’t using these cash reserves to fund innovation they are sitting on them letting them go idle.  If these companies are aren’t going to use these funds to build value they should distribute them where they can be redeployed.  We need to find a way to get them into the hands of entrepreneurs who will innovate.

That brings us to another paradox.  I often hear that there are more investment funds available than there are good ideas.  Yet we have so many problems in society that entrepreneurs can solve and more people than ever who want to purse entrepreneurship.  Maybe we need to combine those funds with a better support system for entrepreneurs.  An economy full of entrepreneurs creating new ventures, solving problems and employing people is how a market is supposed to function.

It is critical to build this entrepreneurial society for another reason.  When there are few alternatives available excess funds flood into the stock market or real estate where they push up price resulting in bubbles.  When the bubbles burst this value disappears from the economy.  We have to make investing in entrepreneurs more attractive than the alternatives.

As someone that believes in free markets it pains me to suggest that society may need to take steps to free up this idle cash.  If the markets won’t function as they should and allocate capital efficiently then we need to tax it away and redistribute it in other ways.  It is not ideal but if business won’t create value through innovation that benefits the society where they earned the profits then we need to find people who will.

 

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