Search = Design, Test, Learn, and Iterate.

Added on by Nabila Amarsy.

 

To turn your idea into a business you need to iterate between designing and testing business models and value propositions until you find what will work. This is called “the search”. Read on to learn what you need to pay attention to during this phase to avoid failure. We highlight some simple rules to follow to shape your idea into a business more rapidly. 

Every idea can have different value propositions and business models. One of the most difficult tasks as an innovator, entrepreneur or entrepreneur is to identify and validate the right value proposition and business model that will make your idea succeed. This is called “the search” and consists of designing and testing business models in rapid iterations. It’s only when you concluded your search that you move to implementation.

How Design & Test fit in the Search phase. Image from Value Proposition Design

How Design & Test fit in the Search phase. Image from Value Proposition Design

  

The ‘Search’ begins with Design. In this phase you shape your idea into Business Model Canvases and Value Proposition Canvases. In other words you prototype how you think your idea could be turned into a business. These Canvases provide you with the hypotheses you need to validate in the real world in the Test phase. During this second part of "the search" you aim to produce evidence that shows that customers want your value proposition and that you have found a business model that can scale and be profitable. 

During search you look for three things around which Design and Test evolve (cf. Survival of the Fittest)

  • That customers care about the jobs, pains and gains that you intend to address
  • That customers want your value proposition (i.e. it actually addresses the selected customer jobs, pains, and gains in a satisfying way)
  • That your value proposition is embedded in a business model that can scale and be profitable.

The “Search” is not a linear undertaking that smoothly moves from Design to Test. Rather, it's a constant back and forth between Designing and Testing. You start with a rough design then immediately test. You’ll come out of testing with crucial insights and return to design to improve your prototypes based on your learnings. Then you iterate between Design and Test until you find a value proposition that customers want, embedded in a scalable and profitable business model that will work. 

If you skip the search phase or don’t pay enough attention to it (cf. How a Great Business Plan Will Maximize Your Risk of Failure), you risk scaling prematurely. You risk implementing a value proposition that nobody cares about embedded in a flawed business model. Here’s a list of simple rules to follow to turn your idea into a promising business opportunity when you ‘Design’ and ‘Test’.

 

Design  

Goal: Shape your idea into value proposition and business model prototypes that create value for your customer (i.e. the value proposition) and capture value for your business (i.e. the business model). 

In the ‘Design’ phase, you should:

  • Work visually. Don’t waste time in long winding conversations (we like calling this blahblahbah). Sketch out your ideas and make them tangible (napkin sketches, Canvases, etc.)! 
  • Keep your models/prototypes rough. Deeply refining ideas that are likely to change drastically is expensive and wasteful – only capture the essence in your prototypes.
  • Don’t fall in love with your first idea. Explore and compare alternatives before you focus on one option.
  • Seek criticism early! Present your models early on to spark conversations and use negative feedback to create improved prototypes.
Prototyping.  Image from Value Proposition Design

Prototyping.  Image from Value Proposition Design

Test

Goal: Produce evidence that validates or invalidates the assumptions underlying your value proposition and business model prototypes. Produce insights and learnings that help you feed Design and improve your value proposition and business model prototypes.

In the Test’ phase, you should:

  • Keep the iterations between Design and Test short to produce a maximum amount of learning as quickly as possible. This will allow you to  get results faster - before you run out of cash or lose leadership’s interest. 
  • Start by testing your customers’ jobs, pains and gains before testing solutions. If they don’t care about the issues you’re trying to address they won’t care about how you’re trying to address those issues. 
  • Conduct experiments that resemble real world situations. Surveys and focus groups are a good start to gather insights, but produce poor evidence. Remember that customers rarely do what they say they’ll do. Conduct experiments with real-world call-to-actions, such as email sign-ups, simulated purchases, user tests, etc. 
  • Make it measurable! Good tests lead to measurable learning that give you actionable insights. 
  • Resist the temptation of spending too much money too early. When you start out uncertainty is at its highest! This is when you use quick and cheap tests to produce first insights. Start increasing your spending on prototyping and testing as certainty grows.

Iterate between Design and Test until you find the right value proposition and business model that will help your idea succeed. Excel at the ‘Search’ phase for the right business model and value proposition to minimize risk and increase your chances of success. In our experience corporations and startups that under-perform in Search risk a) wasting a lot of people’s time and money with unproven ideas, b) executing inferior business models and value propositions, or, c) failing entirely because they scale unproven ideas prematurely. 

How to Test. Image from Value Proposition Design

How to Test. Image from Value Proposition Design

How do you Search for the right Business Models and Value Propositions? What have you found most difficult? 


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