Hello fellows! It has been an incredible beginning of the year for me personally and especially career-wise. In this post I want to focus on defining a business idea of Ommik and my brainstorming process and share with you the first draft.
I am learning as I go and this draft will be updated later (and of course, for the purpose of confidentiality, not shared online haha).
Defining a business idea
Why am I defining a business idea in the first place? Well, Ommik is transforming into a startup, and I must make sure I follow the best practice in defining the problem Ommik will be solving. Or, in general, is there a problem to solve?
Problem statement quadrant
Problem statement quadrant, a 2×2 matrix, is one of the most flexible and powerful tools for driving innovative solutions and guiding strategic decision making. Four parts of the quadrant answer the questions:
WHO is facing the problem?
WHAT are the signals indicating this is a problem? Is this problem real and supported by research (market gaps, trend, Google analytics, etc.)?
WHEN / WHERE are the conditions under which we have observed the problem?
WHY is this problem significant? What is the customer impact?
Problem statement quadrant helps to define the problem statement itself. So, here you go:
Hypothesis of the problem
Now, next of defining a business idea: I want to create a high-level hypothesis of the problem. It is important to note, that hypothesis you create, you should have the ability to validate with different metrics.
In my hypothesis I assume many things. Now, my job is to prove every word I assume with real life metrics.
Many people are working from home even after the pandemic. According to The American Opportunity Survey (lead in 2022 by McKinsey & Company – a global management consulting), 58% of job holders in the United States are allowed to work from home at least partially. According to Zippia Hybrid Work Statistics 2022, 74% of U.S. companies are using or plan to implement a permanent hybrid work model. The most recent data from the European statistics agency, Eurostat, has shown that the number of people working from home in the European Union increased in 2021 from 5,5% before the pandemic to 13,5% in 2021. Statistics of 2022 are yet to come.
Working from home increases productivity. A study by Standford of 16,000 workers over 9 months found that working from home increased productivity by 13%. This increase in performance was due to more calls per minute attributed to a quieter more convenient working environment and working more minutes per shift because of fewer breaks and sick days. In this same study workers also reported improved work satisfaction, and stress rates were cut by 50%. 77% of those who work remotely at least a few times per month show increased productivity, with 30% doing more work in less time and 24% doing more work in the same period of time according to a survey by ConnectSolutions. In addition, according to Virtual HQ, one of the key things that companies need to do to set their teams to success is to implement remote work policies, as 50% of professionals believe productivity is the biggest perk of working from home.
Choosing the home office equipment is hard, as there are thousands of options. Search term “home office furniture” gives over a billion results (1.330.000.000) on Google, and more than 5000 results on Amazon DE.
Office furniture is not suitable for home. There are two types of office furniture: commercial and residential. Good explanation was written by Autonomous website. Commercial office furniture is more reliable and durable because it has been designed to be long-lasting and often comes with extended warranties. Therefore, the focus of such furniture is durability, not design. The residential office furniture isn’t built with the same durability because it isn’t meant to be used as frequently as commercial executive office furniture. Instead, it is more casual, as the workforce will only need it during selected times.
Many people don’t have interior design skills. Although, interior design skills are not something you are born with, but more of something you can learn, there are a lot to consider, such as: creativity and attention to detail, good taste, critical thinking, trend following, computer skills, good spatial visualization, color basics knowledge etc.
Many people would rather rely on recommendations rather than make a choice for themselves. According to the data released by McKinsey & Company, recommendation systems drive 35% of purchases at Amazon. Similarly, 75% of what people watch on Netflix is initiated by their product recommendations. According to Spotify, the implementation of the recommendation algorithm has helped increase their number of monthly users from 75 million to 100 million. A 2018 study found that if internet users were looking at two similar products—with a price difference of $2—73% would be more inclined to buy the pricier product with a higher rating.
Many people don’t like to assemble furniture. In 2017, IKEA bought TaskRabbit startup to integrate it within their assembly service, due to the high demand.
Looks pretty good. No?
Value proposition canvas
Value proposition canvas is a business model tool that helps you make sure that a company’s product or service is positioned around customers’ values and needs.
We start from the right and talk about our customers’ needs. Jobs-to-be-done describes what your customer is trying to do, what annoyances they have (pains) when they do those things and what they would wish to have (gains).
Now, on the left side, we list the products and services that we will offer to our customers to help them do the things they want to do. Then we describe how our products and services will relieve their pains and create gains.
Business model canvas
Finally, the business model canvas is a great tool to help you understand a business model in a straightforward, structured way.
Let me remind you once again, this is only a draft, and the end result will be brushed up and defined better, perhaps even differently. I just wanted to share what I have been working on lately. I am happy I managed to learn a lot about defining a business idea and learning new tools along the way to do so.