“Declining startup costs associated with creating companies has democratized the ability to create” (Hartley, 2012). Individuals now want to work for themselves, create their own hours, and follow their dreams. This is accompanied by a rise in the number of entrepreneurs and the rise of me-commerce; “the personalization of commerce.” (Hartley, 2012), There are seven types of entrepreneurs:
Small Business, Family: Aim to reach personal goals with less than 20% annual growth.
Franchise: Franchisor offers franchisee exclusive rights to business,
Professional fast growth and serial: Professional entrepreneurs with more than 20% annual growth.
Corporate: Entrepreneurship within a corporate environment
Creative Disrupters: Introduce disruptive products with value
Social and non-profit: Give back to the community and use social enterprise business model
I would personally love to become a small business, lifestyle, and family entrepreneur because I would rather stay small and I am on the pursuit to furthering personal goals.
These newly found entrepreneurs must first map out their plans and ideas before being able to proceed. A business plan is “the execution document that companies write when planning product-line extensions where customer, market and product features are known.” (Steveblank, 2010). It’s the wrong tool to use for a startup business model and is relatively pointless, as a startup is not executing a series of “knowns”. Instead, startups should use business models as they “reflect the iterative reality that startups face” (Syeveblank, 2010). The business model canvas “brings clarity and simplicity to a traditionally fuzzy topic” (Greenwald, 2012):
Franchise: Franchisor offers franchisee exclusive rights to business,
Professional fast growth and serial: Professional entrepreneurs with more than 20% annual growth.
Corporate: Entrepreneurship within a corporate environment
Creative Disrupters: Introduce disruptive products with value
Social and non-profit: Give back to the community and use social enterprise business model
I would personally love to become a small business, lifestyle, and family entrepreneur because I would rather stay small and I am on the pursuit to furthering personal goals.
These newly found entrepreneurs must first map out their plans and ideas before being able to proceed. A business plan is “the execution document that companies write when planning product-line extensions where customer, market and product features are known.” (Steveblank, 2010). It’s the wrong tool to use for a startup business model and is relatively pointless, as a startup is not executing a series of “knowns”. Instead, startups should use business models as they “reflect the iterative reality that startups face” (Syeveblank, 2010). The business model canvas “brings clarity and simplicity to a traditionally fuzzy topic” (Greenwald, 2012):
After mapping out ideas, entrepreneurs need to raise money in order to put their business model into action. The major sources of funding are as follows:
Now, the entrepreneur needs to develop the business. It is important to note that all businesses “pass through the four stages of a life cycle: Embryonic, Growth, Maturity, and Decline” (Demmler). Phases of the Embryonic stage include:
There are many signs that point us towards a design economy. Design-driven innovations introduced by firms have created huge markets. Innovators have generated products and services with significant and sustainable profit margins, brand value, and spurring company growth. This also includes service design, which “give people the information and tools needed to act” (Andrzejewski, 2007). With this shift, business needs design for a number of different reasons; “design is all about action, acting as the wheels for business, design is tailored to dealing with uncertainty while business solely relies on stability, lastly design understands that products and services are bought by human beings, not segmented target markets.” (Ogilvie).
The design research work moves in this way: themes, research, card sorting, analysis frameworks, POV, ideation/envisioning of potential solutions. Deductive and inductive reasoning are not ideal for design research because they suggest that unknown cases will be like the known cases, and come to conclusions without analytical thinking or examining them for deeper knowledge. However, abductive thinking provides a better description of the philosophy of design research because it looks for an explanation of the trends and behaviors observed, and applies that to form a solution.
The design research and feasibility phase of the embryonic stage starts here. Businesses are interested in understanding individuals purchasing influences and habits. Traditional ways of uncovering such information are distributing surveys and questionnaires. This is simple but answers contain ambiguity because decisions are “made outside our conscious awareness” (Martin, 2013). This is because people don’t know what they want, are poor at recognizing what will influence future behavior and what persuades them after making a purchase. A few guidelines must be followed when undergoing customer engagement. When observing, “remain out of field of vision and don’t get too chatty” (Brodie). When questioning, ask open-ended questions and be an active listener by paraphrasing content and reflecting feelings. It is essential to probe for detail and understanding. Take verbatim notes and create debrief sheets for people interviewed.
Instead of reaching out to individuals with questions, designers need to identify opportunities for innovation by pinpointing problems customers can’t adequately solve. Businesses need to “obsessively search for the job that is important but poorly satisfied” (Anthony, 2012). The three ways that enable designers to predict consumers are: “get to context, watch for workarounds, and focus on non-consumers” (Anthony, 2012). Business’s need to know the difference between a job and function of a product. A function is a feature of a product, while a job is what the customer is hiring the product for. “People seek differentiation, through access, through individuality, or through price” (Hartley, 2012).
This brings us to the topic of ethnography. Ethnography is employed for “gathering empirical data on human societies and cultures” (Ethnography, 2013) through observation, interviews, etc. and aims to describe the nature of those studied. Businesses have found ethnography helpful for understanding how people use products and services and to understand unstated desires or cultural practices that surround products and services. A human-centered approach to new product development is becoming more popular where development starts with users needs rather than technology. Contextualization is important in ethnography as it involves watching participant’s behavior accordingly. Ethnographic process increases the chances of creating new meaning in problem solutions because it addresses actual customer wants rather than what they say they want.
After gathering information, we must analyze it. Analysis tools give a better understanding of the needs and wants of the subject, leading to a POV. There are 9 analysis frameworks: “persona, values–aspirations-experiences, mind maps, 2x2 matrices, Venn diagram, journey map, activity clock, relational Venn diagram, and analogies.” (Adomdza, 2013).
Read more about analysis frameworks here:
The design research work moves in this way: themes, research, card sorting, analysis frameworks, POV, ideation/envisioning of potential solutions. Deductive and inductive reasoning are not ideal for design research because they suggest that unknown cases will be like the known cases, and come to conclusions without analytical thinking or examining them for deeper knowledge. However, abductive thinking provides a better description of the philosophy of design research because it looks for an explanation of the trends and behaviors observed, and applies that to form a solution.
The design research and feasibility phase of the embryonic stage starts here. Businesses are interested in understanding individuals purchasing influences and habits. Traditional ways of uncovering such information are distributing surveys and questionnaires. This is simple but answers contain ambiguity because decisions are “made outside our conscious awareness” (Martin, 2013). This is because people don’t know what they want, are poor at recognizing what will influence future behavior and what persuades them after making a purchase. A few guidelines must be followed when undergoing customer engagement. When observing, “remain out of field of vision and don’t get too chatty” (Brodie). When questioning, ask open-ended questions and be an active listener by paraphrasing content and reflecting feelings. It is essential to probe for detail and understanding. Take verbatim notes and create debrief sheets for people interviewed.
Instead of reaching out to individuals with questions, designers need to identify opportunities for innovation by pinpointing problems customers can’t adequately solve. Businesses need to “obsessively search for the job that is important but poorly satisfied” (Anthony, 2012). The three ways that enable designers to predict consumers are: “get to context, watch for workarounds, and focus on non-consumers” (Anthony, 2012). Business’s need to know the difference between a job and function of a product. A function is a feature of a product, while a job is what the customer is hiring the product for. “People seek differentiation, through access, through individuality, or through price” (Hartley, 2012).
This brings us to the topic of ethnography. Ethnography is employed for “gathering empirical data on human societies and cultures” (Ethnography, 2013) through observation, interviews, etc. and aims to describe the nature of those studied. Businesses have found ethnography helpful for understanding how people use products and services and to understand unstated desires or cultural practices that surround products and services. A human-centered approach to new product development is becoming more popular where development starts with users needs rather than technology. Contextualization is important in ethnography as it involves watching participant’s behavior accordingly. Ethnographic process increases the chances of creating new meaning in problem solutions because it addresses actual customer wants rather than what they say they want.
After gathering information, we must analyze it. Analysis tools give a better understanding of the needs and wants of the subject, leading to a POV. There are 9 analysis frameworks: “persona, values–aspirations-experiences, mind maps, 2x2 matrices, Venn diagram, journey map, activity clock, relational Venn diagram, and analogies.” (Adomdza, 2013).
Read more about analysis frameworks here:
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The verification phase of the embryonic stage starts here. With ideation comes concept testing, which “is the attempt to predict the success of a new product idea before putting it on the market” (Silverman). One way is to develop a prototype. A prototype is “an early sample, model or release of a product built to test a concept or process or to act as a thing to be replicated or learned from” (Prototype, 2013). It is used to expose potential problems in the product, and to verify customer interest. Concept testing is very useful but risky because people “cannot predict future behavior, especially in hypothetical situations, can be skeptical towards new ideas, and don’t have the imagination to see how a new product could benefit them.” (Silverman).
After an idea passes the prototype stage, it is time to develop and introduce it to the market. This may be known as the demonstration/commercialization phase of the embryonic stage. The concept of diffusion of innovation comes into play. This theory explains “how, why and at what rate new ideas and technology spread through cultures” (Diffusion of Innovation). The main elements that impact the spread of an idea over time are the innovation, communication, channels, time, and a social system and is illustrated by the yellow S-curve below. This is a logistic function and shows the markets share of the new idea, eventually reaching saturation. The success of the company depends on the adoption rate of individuals:
After an idea passes the prototype stage, it is time to develop and introduce it to the market. This may be known as the demonstration/commercialization phase of the embryonic stage. The concept of diffusion of innovation comes into play. This theory explains “how, why and at what rate new ideas and technology spread through cultures” (Diffusion of Innovation). The main elements that impact the spread of an idea over time are the innovation, communication, channels, time, and a social system and is illustrated by the yellow S-curve below. This is a logistic function and shows the markets share of the new idea, eventually reaching saturation. The success of the company depends on the adoption rate of individuals:
Below is the adoption process that consumers go through:
These following factors define the characteristics of innovations that influence an individual’s decision to adopt or reject an innovation:
It is important for an entrepreneur to protect their ideas. This allows them to benefit from their creativity without their ideas being directly copied and exploited by others. Intellectual property rights provide competitive advantage and ensure profitability. One way is to copyright, which is “applicable an idea or information that is substantive and discrete” (Copyright, 2013) and generally is "the right to copy" (Copyright, 2013). A trademark is a “recognizable sign, design or expression, which identifies products or services of a particular source from others” (Trademark, 2013) and “are used to claim exclusive properties of products or services” (Trademark, 2013). A patent is a “set of exclusive rights granted by a sovereign state to an inventor for a limited time period, in exchange for the public disclosure of the invention” (Patent, 2013).