Creating a gerat company in a relative vacuum is an exercise in complete trust that the entrepreneur knows what’s best for the customer, perhaps even without interaction with such a customer. It’s probably happened, but not often enough to trust this method as a formula for success.
So, I’ve developed the three step dance in order to help form a repeatable method of how to create a great company from an early idea.
The first step: Involve potential customers early. Even if you know it all – wouldn’t it be an excellent plan to try your idea out on enough actual or potential customers to measure reasonable feedback?
You can use or discard the information you receive. We now know that Steve Jobs created in relative secrecy several of his products that became massive industry drivers of change. The iPad probably would have failed before production, had he used feedback and research from past failures of tablets in any previous form as a guide. On the other hand, most products or services are created in response to a real or perceived need. And most of us are not Steve Jobs.
[Email readers, continue here…] The second step: Take feedback seriously. Making the effort to gather metrics from the field in any form and then ignoring it, takes guts and determination – and in most cases a measure of stupidity. As I analyze business plans, I usually ask the 
entrepreneur early in the process whether s/he has tried this idea or prototype or mockup out on potential users. And if so, what was the response? And from how many people? In what related universe? I want to know that potential paying customers have been queried using enough information or a good enough model to get a real response worth taking seriously. Without this, any information received is suspect. And failure to make use of the information is a red flag for investors.
The third step: Reiterate and return to customers for comments. Seeking, then analyzing responses allows you to make changes to the plan and product in response. But what if the changes create other problems for the customer, or miss the mark, or don’t drive these same customers to more positive responses? The best possible second round feedback should come from the very same people who took the time to review the offering the first time. They have context and should see effort and progress. Their comments should therefore be more valued than those from first-time respondents.
The three step dance:
- Involve your customers early.
- Take feedback seriously.
- Reiterate and return to customers for comments.
So, why not design your product using your real and potential customers as consultants?
Dave,
I agree with this posting in every aspect.
This is the actual process we used as we created and developed Antirion. We started by recruiting customers to go through our training and offered the first twenty customers a 50% discount from our planned retail price with the understanding we wanted and needed them to critique our courses and give us honest video testimonials when they completed the training.
Their feed back was very valuable in helping us improve our initial training program and we received video testimonials from the majority of the participants.
We then offered these participants our second course on the same terms and conditions and 60% signed up and paid for the second course immediately. The 40% that passed on our offer was due to – their inability to pay (half), – decided being an entrepreneur was too much work (one eighth) and the remainder said they believed they knew enough about the new topic and didn’t need the course. We have also received numerous referrals from this first group of students.
We used their feedback to make significant improvements to our platform which is constantly attracting new customers.
Going through this process taught us so much I encourage all your followers to implement your process for every new product they plan to launch.
We are gearing up to scale our business which we should have ready in about three months and then we fully expect to see a huge jump in our revenue.
I appreciate all your posts and all the wisdom you share.