Businesswoman with feet propped on office deskHemera Technologies
Try as you might, you can't write a business plan for every idea you dream up. You need a set of questions that will help you filter or 'stress test' your ideas.
Management guru Peter Drucker always focused on questions, suggesting that failure often resulted from not asking the right questions.
Here are ten questions you should ask yourself before proceeding with any business idea:
1. Are you really clear about the idea? Write the idea out on a 3x5 card and test its clarity on colleagues.
2. Do you create value for customers or users? Is your idea ten times better, faster, stronger, cheaper than the incumbent?
3. Do you solve a problem, address a need or a pain in the market? A pain is an unresolved issue in the market.
4. Does your idea have a competitive advantage? That is, are you doing something better than your competitors?
5. Is your idea sustainable? Most ideas are not. Does it fit with your growth objectives?
6. What variables do you possess (cost, design, service, quality, location, value for money, better technology, brains, etc.) that will lead to a competitive advantage?
7. Will you have margins that will enable you to grow and produce a profit?
8. Do you have the resources (capital, time, people) necessary? If not, can you obtain them easily?
9. Do you know, understand, and have access to early adopters?
10. Does your idea have a best before date? In other words, is the window of opportunity closing? If you wait, will the idea have less potential?
Compiled by K. Jensen, S. Wise. Ted Rogers School of Management, Ryerson University