The VALUE CHAIN (VC) YACHT: Discover and Solve Customer Problems Better, Faster, and Cheaper

Industry/Market/Customer Goal (Job To Get Done): ……………………………………………….………………………….

Problem Pain: (Un)Known

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SoluGon Gain: (Un)Known

Method

#VCYacht. Dr. Rod King. [email protected] & hRp://businessmodels.ning.com & hRp://twiRer.com/RodKuhnKing


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Where currently are we? Where must we

go?

How must we get there?



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System Structure

Performance Structure



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Value Engine

(Proposi<on/Strategy)

#QBE. Dr. Rod King. [email protected] & hRp://businessmodels.ning.com & hRp://twiRer.com/RodKuhnKing


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Value Engine


MarkeGng & Sales



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MarkeGng & Sales

Forces Against

Forces For

Trade-‐off Trade-‐off



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O: Opportuni-‐

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W: Weaknesses

T: Threats

Trade-‐off Trade-‐off

Value Chain Yacht Discover and Solve Customer Problems BeDer, Faster, and Cheaper

IntroducGon Today, startups as well as established organiza<ons are struggling to discover and solve customer problems in a <mely manner. On the one hand, tools such as brainstorming and lateral thinking are rela<vely simple to use but produce low quality solu<ons. On the other hand, tools such as the Six Sigma methodology, Lean Startup method, and TRIZ generate high quality solu<ons but take a long <me to understand and effec<vely apply. Mastery of these laUer tools is also <me-‐consuming and expensive.

ObjecGve The Value Chain Yacht is designed as a simple customizable worksheet that eliminates the trade-‐off of Complexity vs. Quality in tools such as brainstorming, lateral thinking, TRIZ, Six Sigma methodology, and the Lean Startup method. The Value Chain (VC) Yacht can be considered as a “Wisdomsourcing” Board for collabora<vely organizing and managing ideas while rapidly solving customer problems.

Delight The Value Chain Yacht helps people to beUer, faster, and cheaper solve problems. There are 8 levels of proficiency in using the Value Chain (VC) Yacht. The first level of proficiency focuses on use of the VC Yacht as a problem discovery tool. At this first level, the VC Yacht can be learned and applied within 30 minutes especially as a tool for visually collec<ng ideas on the Voice of the Customer. At the eighth level, use of the VC Yacht focuses on developing ideas on the evolu<on of business model ecosystems. Use of the VC Yacht at intermediate levels ranges from product innova<on, value chain analysis, industry analysis, business model innova<on to performance management.

Procedure (for Level 1 of the Value Chain Yacht) 1.  Make a large (A1 size) printout or drawing of the template for the Value Chain (VC) Yacht and place it on a table or wall. 2.  Write out a descrip<on of the Customer Goal or “Job To Get Done”. 3.  Describe or list each problem (preferably using Post-‐It notes) under the Problem Space or “Red Ocean” on lec hand side. 4.  Choose the most important problem. (Why is the selected problem regarded as the most important? What are impacts of problem?) 5.  Generate, under the Solu<on Space or “Blue Ocean”, ideas for solving the most important problem. (Hint: Use analogical thinking.) 6.  Select the highest quality solu<on that can be rapidly implemented as well as which has the least cost.

References Kim, W.C.; Mauborgne, R. (2004) Blue Ocean Strategy. MassachuseUs: Harvard Business Review Press.


ITENN Level 4: BUS. PROBLEM SOLVING q  4 Elements of Good Strategy q  Six Sigma Methodology q  Theory of Constraints q  Customer Dev. Stack q  Lean Startup Method

Level 5: VALUE CHAIN STRATEGY q  Value Chain (Analysis) q  5 Forces; Env. Analysis q  3 Generic Strategies q  DisrupGve InnovaGon Theory q  Blue Ocean Strategy/Canvas

Level 1: PROBLEM DISCOVERY q  Voice of the Customer; NPS q  Trade-‐offs; SWOT Analysis q  Red Ocean Strategy Canvas q  4 Problem Archetypes; BUMP q  Product/Market Matrix

Level 7: BUS. MODEL EXECUTION q  HolisGc System Resources q  Core Competences q  Resource-‐Based View q  Balanced Scorecard; Kanban q  Prototype/Pilot/Full Scale

Level 8: ECOSYSTEM EVOLUTION q  9 Windows (MulGscreen) q  Business Model Dashboard q  Nested S-‐Curve; WarGaming q  Value Network EvoluGon q  EvoluGon of Shared Value

Level 2: PROBLEM ANALYSIS q  5 Whys; AnalyGcal Hierarchy q  Root-‐cause Analysis: Fishbone q  SIPOC Process; Pre-‐mortem q  Universal System Structure q  FuncGonal Analysis Diagram

THE VALUE CHAIN YACHT o  Uses; Areas of Applica<on o  Associated Concepts/Tools o  Taxonomy of Tools for

Problem Finding & Solving

Level 3: IDEA GEN./EVALUATION q  (Visual) Brainstorming q  E.R.I.C. TacGcs (“4 Ac<ons”) q  SCAMPERR Technique; ASIT q  TRIZ: Ideal Final Result (IFR) q  Mission/Vision; Pretotype

Level 6: BUS. MODEL STRATEGY q  Value Net; Lean Canvas q  Business Model Canvas/Env. q  Business Model Storyboard q  “SPARC” Yacht/Framework q  PESTLIED Events & Trends


8 LEVELS AND USES OF THE VALUE CHAIN YACHT (Taxonomy of Problem-‐Based Strategy & Learning) Discover and Solve Customer Problems BeDer, Faster, and Cheaper

Problem-‐Based Strategy and Learning (PBSL) Roadmap Select/Reflect on a Path or Program for Customer Problem Discovery and Solving

BUSINESS MODEL HIERARCHY (Unit of Analysis/ReDesign) LEVEL OF PBSL (Deliverable)

Supersystem (Economy; Macro-‐environment)

Environment (Industry; Market)

System (Enterprise/Value Chain; Product/Service)

Visionary/Conceptual Problem Solving (Pretotype)

1. PROBLEM DISCOVERY

2. PROBLEM ANALYSIS

3. IDEA GENERATION/EVALUATION

Strategic Problem Solving (Prototype; Pilot)

4. BUSINESS PROBLEM SOLVING

5. VALUE CHAIN STRATEGY

6. BUSINESS MODEL STRATEGY

Tac<cal/ Opera<onal Problem Solving (Full-‐scale)

7. BUSINESS MODEL EXECUTION

Scenario Thinking

8. ECOSYSTEM EVOLUTION


4 Problem Archetypes Product/Market Matrix


PROBLEM (Market Trade-‐off/Size)

SOLUTION (Product Features)

Known Unknown

Known Simple System (Tame; Closed; Well-‐structured)

Complex System

Unknown Complicated System ChaoGc System (Wicked; Open; Ill-‐structured)

The TheoreGcal Framework of

The Value Chain Yacht Is

HolisGc Problem Solving (HPS) Which Encapsulates

Scien<fic Problem Solving HolisGc Problem Solving (HPS) has 3 Levels

q  Visionary/Conceptual Problem Solving q  Strategic Problem Solving q  Tac<cal/Opera<onal Problem Solving

A Value Chain Yacht

Is A Diagram That Shows A Chain of AcGviGes

That an OrganizaGon Uses To Create, Deliver, and Share Value

The Value Chain Yacht Can Be Regarded As a

Means, Vehicle, Tool, or Holis<c System for Itera<vely Pursuing Any Mission, Vision,

Goal, ObjecGve, Strategy, and/or Target Especially Under CondiGons of

Great Uncertainty

The Working Space of a Value Chain Yacht Is

Divided Into 3 Sec<ons:

* Problem Space (“Red Ocean”): Where currently are we?

* Method Space (“Vehicle”; Strategy):


* SoluGon Space (“Blue Ocean”): Where must we go?

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Industry/Market/Customer Goal (Job To Get Done): Improve innova<on and performance of organiza<on

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CURRENT INNOVATION/PERFORMANCE FUTURE INNOVATION/PERFORMANCE


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Method CURRENT INNOVATION/PERFORMANCE FUTURE INNOVATION/PERFORMANCE

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Lack of shared purpose, mission, and vision

Emphasis on technical features of products rather than customer experiences

Thinking in “silos”

No common language or framework for facilitaXng innovaXon

UnarXculated values/culture

Unclear Business Model/Strategy



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Services

Outbound LogisGcs

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Procurement

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Firm Infra.

Value Engine


MarkeGng & Sales


Lack of shared purpose, mission, and vision

Emphasis on technical features of products rather than customer experiences

Thinking in “silos”

No common language or framework for facilitaXng innovaXon

UnarXculated values/culture

Unclear Business Model/Strategy


A Value System Yacht Shows

An Extended Value Chain From Suppliers

Through the Value Chain Yacht To Customers



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Suppliers (Co-‐creators)

Customers



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Customers

New Entrants (Startups)

Subs<-‐tutes

(Incumbents)



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New Entrants (Startups)

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(Incumbents)

q  Provide customer support/repairs

q  Fulfill orders q  Deliver product/service q  Use channels (offline/online)

q  Process/transform inputs (materials/info) q  Develop product/service/business model q  Discover/solve customer and business problems

q  Receive inputs (materials/info) q  Warehouse or store inputs (materials/info) q  Manage/control inventory

q  Purchase inputs (materials/ info)

q  Conduct R & D

q  Develop innovaXve/ disrupXve technology

q  Experiment with business model innovaXon

q  Recruit/ Develop/ Pay Staff

q  Manage business

q  Acquire/ Rent infra’

q  Engage/Acquire/Retain Customers

q  Brand/AdverXse/Sell


Customers

“Bad” vs. “Good” Value System Yacht

All Failures In Business and Life Are the Results

Of Using “Bad” Value System Yachts

All Successes In Business and Life Are the Results

Of Using “Good” Value System Yachts

“It’s more fun to be a pirate than to join the navy."


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