If you are looking at creating a new business, expanding your current product offering, or looking to take your business into completely new markets then you should have an answer for these 4 questions:
1. Is there a market need? Do your due diligence to determine if there is adequate profitability potential in regards to Michael Porter’s Five Forces of Industry structure: current competitive landscape, price sensitivity of customers, threat of completely different products or businesses entering the market, bargaining power of the suppliers you use to deliver value and the threat of even more competitors entering due to low barriers of entry.
2. Do you have the competency to deliver? Make sure you have a solid strategy detailing exactly how you will deliver value. Make sure you have the business acumen to generate critical insights through a step-by-step assessment of not only your current business environment but also the general direction of what the future environment might look like.
3. Do you know what resources to allocate to make your plan actionable? Resources in a current business can be (physical assets and financial resources) intangible items like: (brand, culture and reputation) or intellectual property like: (knowledge, competency or skills.) Know what different activities you can do that the competition is not or similar activities your can do in a different way than the competition. Understanding what resources to leverage, and where, gives you the ability to implement an action plan that executes an effective strategy.
4. Do you have passion or some desire for this project? Passion helps to protect us from rejection and push through obstacles. Having passion turns the volume down on critics and naysayers and gives an extra boost of energy to keep pushing when circumstances aren’t great. If you are competent and have identified the correct need but don’t have passion you may succeed but the environment you create for yourself won’t be optimal.