Knowing a Winning Business Idea
Harvard Business Review
September/October 2000
W. Chan Kim & Renée Mauborgne
Knowing a
Winning Business Idea Three analytical tools
The buyer utility mapThe price corridor of the massThe business model guide
Knowing a
Winning Business IdeaThe Buyer Utility Map
Knowing a
Winning Business Idea Creating exceptional utility
Buyer experience cycle• Purchase• Delivery• Use• Supplements• Maintenance• Disposal
Knowing a
Winning Business Idea
Knowing a
Winning Business Idea Creating exceptional utility
Six utility levels• Customer productivity• Simplicity• Convenience• Risk• Fun and image• Environmental friendliness
Knowing a
Winning Business Idea How successful innovators have
staked out new spaces on the map.Using a new utility lever
at the same stage.Using the same utility lever
in a new stage.Using a new utility lever
in a new stage.
Knowing a
Winning Business Idea
Knowing a
Winning Business Idea Setting a strategic price
Price must help retain – not merely attract – customers in large numbers.
Step 1: Identify price corridor of mass• Different form, same function• Different form and function, same
objectiveStep 2: Specify a level within the price
corridor
Knowing a
Winning Business Idea
Knowing a Winning Business Idea
Building a profitable business modelWhat is the cost target?Who can we partner with?Which price model should we use?
Knowing a Winning Business Idea
Overcoming adoption hurdlesEmployeesBusiness partnersThe general public