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Chapter 3: Initial Assessment - Page 3.2

Define the Pain Point

Define the pain point that drives your business. What customer problem, need, or want does your business address? This is a core concept you'll need to establish with a mission statement. Who is better off because your business exists, and why are they better off?

Sometimes this is obvious. A bakery supplies fresh bread. A car supplies transportation. A commercial jet takes people from one city to another.

Some pain points are less obvious. Does anybody really need hair coloring? Starbucks offers "affordable luxury." That's not an obvious need but it is an obvious want. Does anybody really need an extremely expensive automobile that carries only two people and goes three times faster than the law allows? No, but some people want that, and businesses that supply it do very well.

Here are some other examples:

  • Some restaurants solve the problem of getting food cheaply, or fast. Some solve the problem of where people can go out together to celebrate an occasion with a good meal. Which one is likely to be at an airport? Do all restaurants have the same mission? Does the high-end restaurant solve a problem as much as it fills a need and supplies a want?
  • A résumé writer solves a specific problem for specific people.
  • A pickup truck solves one set of problems for one set of people, and a sports car solves another set of problems for a different set of people. The pickup truck doesn't have to take corners fast, and the sports car doesn't have to carry a lot of cargo.

What Business Are You In?

Ask yourself what business you are in, and don't narrow yourself down. One of the classic business examples is the railroads, which lost a chance to expand in the twentieth century because they misdefined themselves. They thought they were in the business of running trains on tracks. They didn't understand they were in the business of transporting goods and people. When trucks, buses and highways grew, the railroads were left behind.

My company, Palo Alto Software, is not in the business of software development. It is in the business of helping people do business plans by themselves, providing business know-how through software and documentation. The broader definition helps us understand what we're up to.


Copyright © Timothy J. Berry, 2006. All rights reserved.