10 Characteristics of Great Value - · PDF filemindset. Reﬁne 7 — Seek Criticism 8 9 6...

www.strategyzer.com/vpdWritten by Alex Osterwalder, Yves Pigneur, Greg Bernarda, Alan Smith Designed by Trish Papadakos • Copyright Strategyzer A.G. The makers of Business Model Generation and Strategyzer

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10 Characteristics of Great Value Propositions

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Focus on the jobs, pains, and gains that matter

most to customers

Go beyond functional jobs and address emotional and

social jobs

Differentiate from competition on jobs, pains, and gains that customers

care about

Focus on unsatisfied jobs, unresolved pains, and

unrealized gains

Align with how customers measure success

Outperform competition substantially on at least

one dimension

Are embedded in great business models

Target few jobs, pains, and gains, but do so

extremely well

Focus on jobs, pains, and gains that a lot of people

have or that some will pay a lot of money for

Are difficult to copy

Stop for an instant and reflect on the characteristics of great value propositions before reading about how to design them in this chapter. We offer 10 characteristics to get you started. Don’t hesitate to add your own. Great Value Propositions…

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10 PrototypingPrinciples

Embrace a beginner’s mind

Start with low fidelity, iterate, and refine

Use creativity techniques

Don’t fall in love with first ideas —

create alternatives

Expose your work early — seek criticism

Create “Shrek models”

Make it visual and tangible

Feel comfortable in a “liquid state”

Learn faster by failing early, often and cheaply

Track learnings, insights, and progress

Unlock the power of prototyping. Resist the temptation of spending time and energy refining one direction only. Rather, use the principles described here to explore multiple directions with the same amount of time and energy. You will learn more and discover better value propositions.

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10 TestingPrinciples

Learn faster and reduce risk by embracing failure

Balance learnings and vision

Make it measurable

Test early; refine later

Identify idea killers

Accept that not all facts are equal

Realize that evidence trumps opinion

Experiments ≠ reality

Understand customers first

Test irreversible decisions twice as much

Apply these 10 principles when you start testing your value proposition ideas with a series of experiments. A good experimentation process produces evidence of what works and what doesn’t. It also will enable you to adapt and change your value propositions and business models and systematically reduce risk and uncertainty.

Copyright Strategyzer A.G. The makers of Business Model Generation and Strategyzer www.strategyzer.com/vpd

A Day inthe LifeWorksheet

Dive deep into your (potential) customers’ worlds

to gain insights about their jobs, pains, and gains.

What customers do on a daily basis in their real

settings often differs from what they believe they

do or what they will tell you in an interview,

survey, or focus group.

objectiveUnderstand your customer’s

world in more detail

outcomeMap of your customer’s day

Capture the most important jobs, pains, and

gains of the customer you shadowed

Time Activity (what I see) Notes (what I think)


Ad-Lib Value Proposition TemplateAd-libs are a great way to quickly shape al-

ternative directions for your value proposition.

They force you to pinpoint how exactly you are

going to creating value. Prototype three to five

different directions by filling out the blanks in the

ad-lib below.

Our ______________

help(s) ___________

who want to _________________

by ______ ________

and_____ ________.

Products and Services

jobs to be done

verb (e.g., reducing, avoiding) and a customer pain

verb (e.g., increasing, enabling) and a customer gain

competing value proposition

Customer Segment

(unlike ___________ )

objective

Quickly shape potential value proposition directions

outcome

Alternative prototypes in the form of “pitchable”

sentences


Rule 1

Adopt a beginner’s mindListen with a “fresh pair of ears” and avoid interpretation. Explore unexpected

jobs, pains, and gains in particular.

Rule 2

Listen more than you talkYour goal is to listen and learn, not to inform, impress, or convince your customer

of anything. Avoid wasting time talking about your own beliefs, because it’s

at the expense of learning about your customer.

Rule 3

Get facts, not opinionsDon’t ask, “Would you...?”

Ask, “When is the last time you have...?”

Rule 4

Ask “why” to get real motivationsAsk, “Why do you need to do…?”

Ask, “Why is ___ important to you?”

Ask, “Why is ___ such a pain?”

Rule 5

The goal of customer insight interviews is not selling (even if a sale is involved); it’s about learningDon’t ask, “Would you buy our solution?”

Ask “what are your decision criteria when you make a purchase of…?”

Rule 6

Don’t mention solutions (i.e., your prototype value proposition) too earlyDon’t explain, “Our solution does…”

Ask, “What are the most important things you are struggling with?”

Rule 7

Follow upGet permission to keep your interviewee’s contact information to

come back for more questions and answers or testing prototypes.

Rule 8

Always open doors at the endAsk, “Who else should I talk to?”

It is an art to conduct good interviews that provide relevant insights for value proposition design. Make sure you focus on unearthing what matters to (potential) customers rather than trying to pitch them solutions. Follow these rules to conduct great interviews.

Ground Rules for Interviewing


Six Ways to Innovate from the Customer Profile

You’ve mapped your Customer Profile.

What to do from here? Here are six ways to trigger

your next Value Proposition move.

Address a more complete set of jobs,

including related and ancillary jobs.

Look beyond functional jobs and create new value

by fulfilling important social and emotional jobs.

Help customers do a job that is

different from what most value propositions

currently focus on.

Help more people do a job that was

otherwise too complex or too expensive.

Help customers better do a job by

making a series of microimprovements

to an existing value proposition.

This is the stuff of new market creation, when a

new value proposition dramatically outperforms

older ways of helping a customer get a job done.

Address more jobs?

Go beyond functional jobs?

Switch to a more important job?

Help a lot more customers get a job done?

Get a job done incrementally better?

Help a customer get a job done radically better?

Can you...

Written by Alex Osterwalder, Yves Pigneur, Greg Bernarda, Alan SmithDesigned by Trish Papadakos


1On PaperProblem-Solution Fit

Problem-solution fit takes place when you

• Have evidence that customers care about certain jobs,

pains, and gains.

• Designed a value proposition that addresses those jobs,

pains and gains.

3In the BankBusiness Model Fit

Business model fit takes place when you

• Have evidence that your value proposition can be embed-

ded in a profitable and scalable business model.

The 3 Types of Fit

2In the MarketProduct-Market Fit

Product-market fit takes place when you

• Have evidence that your products and services, pain reliev-

ers, and gain creators are actually creating customer value

and getting traction in the market.

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2

3

Learning Card

We believed thatstep 1: hypothesis

Insight Name

Person Responsible

Date of Learning

From that we learned thatstep 3: learnings and insights

We observedstep 2: observation

Therefore, we willstep 4: decisions and actions

The makers of Business Model Generation and StrategyzerCopyright Business Model Foundry AG

Data Reliability:

Action Required:

Test Card

We believe that

Test Name

Assigned to

Deadline

Duration

And measure

To verify that, we will

We are right if

The makers of Business Model Generation and StrategyzerCopyright Business Model Foundry AG

Test Cost: Data Reliability:

Critical:

Time Required:

10 Characteristics of Great Value - · PDF filemindset. Reﬁne 7 — Seek Criticism 8 9 6...

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