Module 3. Business Analysis And Strategic Management

Welcome to Module 3!

The third module of this course deals with business analysis and strategic management. It analyses the sources of entrepreneurial ideas, which often come from professional experience, but may also derive from personal experience, frustration with what is already available on the market or simply passion for something. We will take a look at the business model canvas, which is a powerful strategic tool for developing and assessing new business models, with the value proposition at its centre. This module concludes with some advice about how to manage a startup in order to increase the likelihood of success.

The instructor is Ricardo Zozimo, Assistant Professor in Management at Universidade Nova de Lisboa. The module is divided into the following three topics:

3.1 Market assessment and customer development. Main techniques.
3.2 Lean Startup. Business Model Canvas.
3.3 Lifecycle management of an entrepreneurial initiative. Main techniques.

In this first video of Module 3 we will analize the main techniques that entrepreneurs can use for market assessment and customer development.

Market assessment is an in-depth evaluation of the potential of a new product, a new business idea or a new investment. It is a detailed analysis of the environmental conditions, market trends, competition, risks, opportunities and resources and limitations of the company. Market assessment is the first step that must be taken to determine if there is a need or a customer base for a particular product or service and prevent, thus, the waste of resources, loss of opportunities, scarce benefits or considerable financial losses.

Customer development is a technique used to try to focus the business idea on what customers want and avoid wasting time, money and resources on products and services that they do not really want or need. It can be used both to identify problems and opportunities in new business ideas and to optimize existing projects. The customer development method was created by serial entrepreneur Steve Blank. You can learn more about this in the Complementary Materials section.

When you want to launch an entrepreneurial project you need some tools to help you. Lean Start Up and the Business Model Canvas are two highly recommendable tools that you could use.

Lean Startup is a methodology for creating and developing businesses and products. Its fundamental idea is to shorten product development cycles through:

experimentation based on hypotheses to measure progress.
iterative product launches to obtain fast feedback from customers.
validated learning.

In this way, startups can focus on products or services that meet the needs of the first customers, reducing risks and avoiding large amounts of initial financing.

On the other hand, the Business Model Canvas is another really powerful tool when people are launching their entrepreneurial endeavours and it’s powerful because it enables them to focus on the value proposition. The value proposition is the promise that an entrepreneur makes to customers and it is at the centre position of the business model canvas, thus allowing entrepreneurs to focus all their energy, all their techniques and all their tools on delivering that value proposition.

The third and last concept in this Module concerns the main techniques that can be used in the lifecycle management of an entrepreurial initiative.

In this video, professor Ricardo Zozimo focuses on three main ideas for lifecycle management:

Know your value proposition
Surround yourself with a team that can add value
Focus on learning

Entrepreneurship can be learned and there are certain personal and business traits that you require. Entrepreneurs have to be prepared to take risks. They also need to learn to think outside the box, which can be achieved through comprehensive and connecting questions such as: What is the problem? What is the question? How does my solution differ from existing solutions? Etc.

A successful entrepreneur needs passion and has to be prepared for a lot of stressful work, constant worry and fast change. There are also some other traits that can help to achieve success, such as focusing on your work, being prepared to learn all the time, putting quality before quantity (which is extremely important in today’s highly competitive world) and having vision. Without vision, nothing will happen. The choice of role model is also important, as are the use of networks and having the right mentor.