THE CUSTOMER DEVELOPMENT ROADMAP FOR BLUE OCEAN STRATEGISTS

THE CUSTOMER DEVELOPMENT ROADMAP
FOR BLUE OCEAN STRATEGISTS
Dr. Rod Kuhn King
Visual Problem Solver, Inventor, and Magician

Copyright 2010. Dr. Rod King. rodkuhnking@sbcglobal.net & http://businessmodels.ning.com & http://twitter.com/RodKuhnKing
GURUS
CUSTOMER DEVELOPMENT
ROADMAP
(based on Steve Blank’s book:
“The Four Steps
To The Epiphany”)
CUSTOMER DEVELOPMENT ROADMAP
The 4 Stages of the Customer Development Journey for a Scalable Startup
1. CUSTOMER DISCOVERY 2. CUSTOMER VALIDATION
3. CUSTOMER CREATION 4. COMPANY BUILDING

GURUS
ROADMAP
(based on Steve Blank’s book,
“The Four Steps To The Epiphany”
and W. Kim & R. Mauborgne’s book,
“Blue Ocean Strategy”)
CUSTOMER DEVELOPMENT ROADMAP - Details
The 4 Stages of the Customer Development Journey for a Scalable Startup
3. CUSTOMER CREATION
3.1 Get Ready
3.2 Position
3.3 Launch
3.4 Create Demand
1. CUSTOMER DISCOVERY
1.1 State Your Hypothesis
- VISUAL AWAKENING: “As Is” Strategy Canvas (Office work)
1.2 Test “Problem” Hypothesis
- VISUAL EXPLORATION: Four Actions Grid (Field work)
- VISUAL STRATEGY FAIR: “To Be” Strategy Canvas
- VISUAL COMMUNICATION: Comparison of Canvases
1.3 Test “Product” Hypothesis: Minimum Viable Product (MVP)
- Build MVP: Prototype Ad/Headline/Web
Page/Product/Service; Min. Feature Set
- Test MVP
- Test Hypotheses for Business Model
2. CUSTOMER VALIDATION
2.1 Get Ready to Sell
2.2 Sell to “Earlyvangelists”
2.3 Develop Positioning: Product-Market Fit
- Proposed Strategy Canvas (Customer Experience Curve)
- Proposed Scalable Business Model
2.4 Verify
- Product-Market Fit
- Scalable Business Model
4. COMPANY BUILDING
4.1 Mainstream Customers
4.2 Management/Culture Issues
4.3 Functional Departments
4.4 Fast Response Departments

GURUS
THE 2 WORLDS OF
THE 2 WORLDS OF CUSTOMER DEVELOPMENT
CUSTOMER DISCOVERY CUSTOMER VALIDATION
CUSTOMER CREATION COMPANY BUILDING
WORLD OF SEARCH FOR SCALABLE BUSINESS MODEL
(For ‘Startups/Entrepreneurs/Founders’)
WORLD OF EXECUTION FOR SCALABLE BUSINESS MODEL
(For ‘Established or Matured Companies/Accountants’)

CUSTOMER CREATION PYRAMID FOR
THE BLUE OCEAN STARTUP
 Delighters
 Satisfiers
 Dissatisfiers
 Delighters
 Satisfiers
 Dissatisfiers
 Delighters
 Satisfiers
 Dissatisfiers
NON-COMPETITORS
(Remote Industries/Economy:
Sectoral & Geographical Non-alternatives)
DIRECT COMPETITORS
(Core Sector/Strategic Groups:
Substitutes)
BUSINESS
(New) Customer Value Proposition/Market: …………………………………………………………………..
 NON- CUSTOMERS
o Profitable
o Break-even
o Unprofitable
Oh My God-
Product/Service
Why?
How?
Why?
How?
Why?
How?
INDIRECT COMPETITORS
(Peripheral/Adjacent Industries:
Alternatives/Value Chain Complements)
Diffusion (Word-of-mouth) Potential = Delighters + Satisfiers - Dissatisfiers
GURUS
 Hypotheses vs. Reality
 JTBD = Job To Be Done

CORE VALUES (Incentives/Penalties)
STAKEHOLDER IMPACTS
[Profit (Margin); Revenue /Cost ;
Unit Price; Volume; Speed; Trade-off]
GOALS, OBJECTIVES,
STRATEGIES & TACTICS
(PLAN)
CUSTOMER PROBLEM
(BIG URGENT MARKET PROBLEM:
BUMP)
RESOURCES
(GLOBAL VALUE CHAIN/Bus. Model)
 S: Suppliers
 E: Employees (Core Competencies)
 M: Machinery/Equipment/Facility
 P: Processes
 O: Output (Product/Service)
 R: Retailers/Distributors/Channels
 C: Consumer/Customer Segments
 E: Environment: Competitors, etc.
COMPANY BUILDING BLUEPRINT (Version X)
MISSION/VISION
CUSTOMER VALUE PROPOSITION
GURUS

ITENNE: ENVIRONMENT P: PROCESSES
S: SUPPLIERS/MATERIALS
R: RETAILERS/DISTRIBUTORS/
CHANNELS
O: OUTPUTS (PRODUCT/
SERVICE)
E: EMPLOYEES/KNOWLEDGE
ASSETS/CULTURE
GLOBAL VALUE CHAIN:
OUTCOMES/GOALS
 Customer Value Proposition (Job)
 Business Value = Revenue/Cost
 Customer Value (Experience) =
Customer Delight/Customer Pain
M: MACHINERY/EQUIPMENT/
FACILITY/LOCATION
C: CUSTOMERS/CONSUMERS &
RELATIONSHIPS
GLOBAL VALUE CHAIN
Zoomable Elements of a Value Chain or Business Model: “SEMPORCE”
GURUS

ITENNE: ENVIRONMENT/INVESTOR
 Revenue (Sales)
 Cash Burn Rate
 Month of Cash Left
 Time to Cash Flow-Breakeven
 Contribution Margin
P: PROCESSES
 Cycle Time for Pivots/Prototyping/
Versioning/Product Releases
 Average Time to First Order
 Average Time to Follow-on Order
 Customer Feedback/Voice
CHANNELS
 Advertising Expenses
 Viral Coefficient
SERVICE)
 No. of Minimum Viable Products
 No. of Prototypes/Releases
 Average Size Order
 Average Selling Price per Order
 Web Page/Site: Total Visits;
Total Page Views
ASSETS/CULTURE
 Agile/Lean (‘Small’) Teams
 Lessons Learned/Insights
 No. of Experiments/Interviews
 Effectiveness/Proficiency of
Sale Person
 Revenue per Sale Person
DASHBOARD (CDD)
OUTCOMES/GOALS:
 Customer Value Proposition
FACILITY/LOCATION
RELATIONSHIPS
 No. of Prospects/Registrations
 No. of Customers/Referrals
 Cost per Acquisition (Paid/Net)
 Customer Lifetime Value
 Customer Loyalty/Retention:
Net Promoter Score (NPS)
CUSTOMER DEVELOPMENT DASHBOARD
FOR THE BLUE OCEAN STARTUP
GURUS

APPENDIX

A Blue Ocean Startup
Is a “Value Innovation” Business That
Creates an Uncontested Market Space and
Makes Competitors Irrelevant

Eventually, a Blue Ocean Startup has
 a Profit Margin of, at least, 20% p.a.
 not more than 3 Direct Competitors
in a Fast-growing Market (Niche)
a Market Share of, at least,
3 Times That of Nearest Competitor

ORIGINAL BLUE OCEAN STARTUPS
ORIGINAL
BLUE OCEAN STARTUPS
GURUS

But, how are Blue Ocean Startups Created?

WHY (PROBLEMS)?
RED OCEAN
 Overcrowded Industries
 Commoditized Products/Services
 Similar Customer Exp. Curves
 Globalization
 Accelerated Technological Adv.
HOW MANY? HOW MUCH?
 INSEAD, France (Europe)
 UCSI (Asia)
 Kimberly Clark-BOSI
 Many Communities of Practice for
Blue Ocean Strategy on the Web
WHAT (PROBLEMS)?
RED OCEAN (BLOODY COMPETITION)
 Head-to-head Competition
 Price Wars
 Shrinking Business Profit
 ‘Fixed’ Market Boundaries
HOW (SOLUTION)?
BLUE OCEAN (STRATEGY)
 Create Uncontested Market
Space: ‘Category of One’
 Make Competitors Irrelevant
 Use Value Innovation: Resolve
Cost vs. Differentiation Trade-off
WHAT NEXT?
See www.blueoceanstrategy.com
WHERE (PROBLEMS)?
 Overcrowded Industries
 Slow Growing/Matured Sectors
THE METHODOLOGY OF
BLUE OCEAN STRATEGY
(based on W. Chan Kim &
Renee Mauborgne’s book:
“Blue Ocean Strategy”)
WHEN?
See www.blueoceanstrategy.com
WHO?
W. Chan Kim & Renee Mauborgne
 Professors at INSEAD
(France)
 Authors of “Blue Ocean
Strategy”
OVERVIEW OF
THE METHODOLOGY OF BLUE OCEAN STRATEGY
“How to Create Uncontested Market Space and Make the Competition Irrelevant”
GURUS

WHY (PROBLEMS)?
 Use of Waterfall Model for
Product Development
 Having Little or No Customers:
Product-Market Misfit
HOW MANY? HOW MUCH?
Growing Communities of Practice for
 Customer Development Model
 Lean Startup Model
WHAT (PROBLEMS)?
 9 out of 10 New Products are
Failures (Unprofitable)
 High Mortality Rate of Scalable
Startups
HOW (SOLUTION)?
 Customer Development Model
(Steve Blank): Customer Discovery;
Customer Validation; Customer
Creation; Company Building
 Lean Startup Model (Eric Ries):
Continuous & Rapid Deployment
WHAT NEXT?
See http://steveblank.com/
WHERE (PROBLEMS)?
 Scalable Startups especially in
Silicon Valley, California
 World of Business (Startups)
THE METHODOLOGY OF
(based on Steve Blank’s book:
“The Four Steps
To The Epiphany”)
WHEN?
See http://steveblank.com/
WHO?
Steve Blank
 Retired Serial Entrepreneur
 Author of “The Four Steps
To The Epiphany”
 Creator of “Customer Dev. Model”
 Entrepreneurship Professor
OVERVIEW OF
THE METHODOLOGY OF CUSTOMER DEVELOPMENT
“Successful Strategies for Products That Win”
GURUS

ITENN
GURUS
BUSINESS MODEL DEVELOPMENT
TOOLS FOR SYSTEMATICALLY CREATING BLUE OCEAN STARTUPS
WISDOMSOURCING MAP
(Rod King)
(Steve Blank)
BLUE OCEAN STRATEGY
(W. Chan Kim & Renee Mauborgne)
Blue
Ocean
Startup
Market Types
(Customer Experience
Map)
Value Innovation
VoC
Note
VoC: Voice of Customer
LEAN STARTUP
(Eric Ries)

(-): PAIN
(+): DELIGHT
Disruption Spot
Luxury Spot
Strategic
Choice
Key
OMG-Experience:
Undesirable Experience:
Profit Margin
No. of Direct Competitors
(Level of Commoditization)
Blue Ocean
(“Practical Impossibility”)
Luxury Spot
Disruption Spot
Green Ocean Red Ocean
JOURNEY OF
3
100%
6
10%
20%
10 (Global)

(-): PAIN
(+): DELIGHT
Disruption Spot
Luxury Spot
Strategic
Choice
Profit Margin
No. of Direct Competitors
(Level of Commoditization)
COMPANY BUILDING COMPANY SCALING/
ACQUISITION
CUSTOMER CREATION
CUSTOMER DISCOVERY
& VALIDATION
‘CUSTOMER DEVELOPMENT’ JOURNEY OF
3
100%
6
10%
20%
10 (Global)

(-): PAIN
(+): DELIGHT
Disruption Spot
Luxury Spot
Strategic
Choice
Key
OMG-Experience:
GURUS
Sweet Spot
STARTUP
Blue Ocean
STARTUP
(“Practical Impossibility;
Value Innovation”)
Luxury Spot
STARTUP
(“Existing Market”)
Disruption Spot/
Lean STARTUP
(“Resegmented/Reframed
Market; Lean/No-frills Niche”)
Volcano
STARTUP
Oasis
STARTUP
Green Ocean
STARTUP
Red Ocean
STARTUP
No-Man’s-Island
STARTUP
3
10
6
3
6
10
Ideal Value Space
(Ideal Market/
Ideal Impossibility/
Ideal Tool/
Ideal Universe/
New Market
STARTUP)
10 ARCHETYPAL STARTUPS & MARKET TYPES
“What Kind of a Startup Are We? What Kind of a Startup Must We Be? How?”
Differentiation
(Performance)
Cost

(-): PAIN
(+): DELIGHT
Disruption Spot
Luxury Spot
Strategic
Choice
Resegmented/
Reframed/Low-cost
Market;
Lean/No-frills Niche
Cost
(Adoption Barrier; Complexity;
Inaccessibility; Delay)
Existing High end-
Market
Performance
(Functionality;
Quality;
Differentiation)
Key
OMG-Experience:
GURUS
Cost-Performance Map for ‘Market Types’
Collaboratively Design Oh My God-Vision, Strategies, Products, Services, and Business Models
Market Segment (Customer Problem/Goal): ………………………………………………………
Ideal Value Space
(Ideal Market/
Ideal Impossibility/
Ideal Tool/
Ideal Universe/
Entirely New Market)
3
10
6
3
6
10
Blue Ocean
Strategy
(“Value Innovation”)

ITENNE: ENVIRONMENT
• Competitors/Industry/Economy
• Partners/Complementors
• Investors/Board of Directors
• Public/Society/Enemies/Non-customer
• Government/NGOs/Environment
P: PROCESSES
• Preparing/Searching/Discovering
• Purchasing/Leasing
• Receiving/Delivering/Learning/Installing
• Using/Sharing/Complementing
• Maintaining/Storing/Managing/Disposing
S: SUPPLIERS/MATERIAL E: EMPLOYEES/KNOWLEDGE
ASSETS/CULTURE
GLOBAL VALUE CHAIN
(PERFORMANCE DASHBOARD)
OUTCOMES/GOALS
 Customer Value Proposition (Job)
FACILITY/LOCATION
C: CUSTOMERS & CONSUMERS
RELATIONSHIPS
 Core Customers/Users/Influencers
 Peripheral Customers/Users/Influ.
 Remote Customers/Users/Influ.
GENERIC ELEMENTS OF GLOBAL VALUE CHAIN
Collaboratively List, Sketch, Organize, and/or Manage Metrics for Elements of Value Chain
GURUS
CHANNELS
 Retailers/Distributors/Channels
 Place/Warehousing/Location
 Promotion/Buzz
 Branding/Marketing
 Advertising
 Selling/Relationship Management
SERVICE)
 Product/Service
 Pricing
 Packaging
 Display
 Design
 Plan

ITENNE: ENVIRONMENT
 Key Partners (KP)
P: PROCESSES
 Key Activities (KA)
 Key Resources (KR) – Suppliers
CHANNELS
 Channels (CH)
SERVICE)
 Key Resources (KR) – Product/
Service
ASSETS/CULTURE
 Key Resources (KR) – Employees
GLOBAL VALUE CHAIN
FOR “BUSINESS MODEL
CANVAS”: GOALS
 Customer Value Proposition (VP)
 Revenue Streams (R$)
 Cost Structure (C$)
FACILITY/LOCATION
 Key Resources (KR) – Machinery
RELATIONSHIPS
 Customer Segments (CS)
 Customer Relationships (CR)
GLOBAL VALUE CHAIN FOR “BUSINESS MODEL CANVAS”
Visually Observe Similarities and Differences Between Global Value Chain & Business Model Canvas
GURUS

ITENNE: ENVIRONMENT
 Key Partners (KP)
 Record Companies
 Original Equipment Manufactur-
ers (OEMs)
P: PROCESSES
 Key Activities (KA):
 Hardware Design
 Software Design
 Marketing
 Key Resources (KR) – Suppliers
CHANNELS
 Channels (CH)
 iTunes Store
 www.apple.com
 Apple Stores
 Selected Retail Stores
SERVICE)
 Key Resources (KR) – Product/
Service
 iPod Hardware
 iTunes Software
 Content & Agreements
ASSETS/CULTURE
 Key Resources (KR) – Employees
 Staff
 Apple Brand
APPLE INC.: iPod (2001)
 Customer Value Proposition (VP):
“A Thousand Songs in Your Pocket”
 Revenue Streams (R$): iPod Hard-
ware; iTunes Store; Commissions
 Cost Structure (C$): Employees;
Manufacturing; Marketing & Sales
FACILITY/LOCATION
 Key Resources (KR) – Machinery
RELATIONSHIPS
 Customer Segments (CS)
 Luxury Spot; Mass Market
 Customer Relationships (CR)
 “Lovemark”
 Switching Costs
GLOBAL VALUE CHAIN FOR APPLE INC.: iPod
Visually Observe Similarities and Differences Between Global Value Chain & Business Model Canvas
GURUS

FOCUS “PIVOT” PROCESS: VALUE INNOVATION TACTICS (What if … E.R.I.C.?) OUTCOME:
FUTURE
(DISRUPTIVE)
BUS. MODEL
BUSINESS/
GLOBAL VALUE CHAIN
GIVEN BUSINESS
MODEL
E:
Eliminate
R:
Reduce/Replace
I:
Increase
C:
Create
INPUT (SUPPLIERS/
MATERIALS/ENERGY)
ELEMENTS
(EMPLOYEES/
MACHINERY)
Staff/
Apple Brand
PROCESS
(Bus. Process/
Strategies)
Hardware Design/
Software Design/
Marketing
OUTPUTS:
PRODUCT/SERVICE
iPod Hardware/
iTunes Software/
Content &
Agreements
RETAILERS/DISTRIB./
CHANNELS
iTunes; apple.com;
Apple Stores/Others
CONSUMERS/
CUSTOMERS (Experience)
Luxury Spot/
Mass Market
ENVIRONMENT
- COMPETITORS (Industry)
- PARTNERS (Complementors)
- INVESTORS (Revenue/Cost)
- PUBLIC/SOCIETY/Enemies
- GOVERNMENT/NGOs
Record Companies/
Original Equipment
Manufacturers
(OEMs)/…
BUSINESS MODEL PIVOT FOR APPLE INC.: iPod - 2001
SYSTEM
(INDUSTRY/BUSINESS) GURUS
Market Segment (Customer Problem): ‘Fragmented’ Music ExperienceMission/Vision: “… Apple leads the digital music revolution. …”

HYPOTHESES PROBLEMS/
PAIN
(WEAKNESS-
ES/THREATS)
GOALS/Objectives/
Strategies/Tactics/
Initiatives/
Projects
Key Metrics/
Performance
Indicators/
Targets
Business Experiences (Impacts)
Description of BUSINESS/
GLOBAL VALUE CHAIN
Delight
(Revenue)
Pain
(Cost)
S: Suppliers
E: Employees/
Knowledge Assets
Staff/
Apple Brand/
Staffing Cost
M: Machinery/
Infrastructure
Hardware Design/
Software Design/
Marketing
P: Processes Marketing
Sales
Marketing Cost
Sales Cost
O: Outputs
(Product/Service)
iPod Hardware/
iTunes Software/
Content & Agreements
R: Retailers/
Distributors/
Channels
iTunes; apple.com;
Apple Stores/
Other Retailers
C: Consumers/
Customers
Luxury Spot/
Mass Market
High Revenue
(Hardware)
E: Environment Record Companies/
Original Equipment
Manufacturers (OEMs)/…
Commissions
VALUE CHAIN
(“SEMPORCE”)
BUSINESS
ECOSYSTEM
Customer Value Proposition:
“A Thousand Songs in Your Pocket”
BUSINESS VALUE
(PROFIT MARGIN)
BUSINESS MODEL PLAN FOR APPLE INC.: iPod - 2001
GURUS
Mission/Vision: “… Apple leads the digital music revolution. …” Market Segment (Customer Problem): ‘Fragmented’ Music Experience

ITENN2001
 Nike’s PSA Play120 (for customers
who workout; has armband)
 Apple iPod (5GB; seamless inte-
gration with iTunes music library
for use on Mac computers)
2002
 Apple iPod (20GB; Windows
compatibility; iTunes Music
Store)
1998
 Eiger Labs releases MP3 player:
- MPMan F10 (Flash drive
capacity of 32MB)
- Diamond Rio PMP300 (32MB
Capacity)
2006
 Mainstream popularity of Music-
phones
2007
 Apple iPhone (Multi-touch
screen; etc.)
 Apple iPod Touch Phone (Multi-
touch screen; etc.)
1999
 Release of Sensory Science Rave
MP 2100 (64MB; voice recorder;
FM tuner)
 Creative Labs’ Nomad (docking)
 PJB-100 (Internal hard disk: 4.8GB)
EVOLUTION OF
THE DIGITAL MUSIC PLAYER
2000
 I2Go eGo (Micro-drive: 2GB;
pocket size; high price)
 Creative Labs’ Nomad Jukebox
(6GB; clunky; high quality sound)
2005
 Apple iPod (60GB; color screen)
 Emerging popularity of music –
telephones: Motorola; Samsung;
LG; Nokia; Sony Ericksson
GURUS
EVOLUTION OF THE DIGITAL MUSIC PLAYER

IMPACTS
SYSTEM
VOICE OF THE CUSTOMER IN CORE & PERIPHERAL INDUSTRIES: Hypotheses vs. Reality
CUSTOMER DELIGHT (+) CUSTOMER PAIN (-)
Decision Criteria:
Needs & Barriers
COMPETITORS
Function/
Content/
Perf/
Knowledge
Quality/
Reliability/
Accuracy/
Efficiency
Brand/
Emotion/
Style/Aura/
Prestige
Customization/
Personalization/
Interactivity/
Fun/Entertain.
Cost
(Price)
Inaccessibility/
Unavailability/
Inflexibility/
Friction/Scale
Complexity/
Difficulty/
Support/
Range/Risk
Process
Time/
Delay/
Age
IMPORTANCE
Given Product:
iPod Nano
Hold 1,000
songs (4 GB)
Watch
Photos/Video
High quality Apple Brand Color
Capacity Choice
$149 Pocketable
No Wireless
Connection
Simple to use
Store-Service
Support
24hr Music
Playback
CORE
COMPETI-
TORS:
iPod Shuffle
Hold 240
songs (1 GB)
Capacity Choice
$79 Ultra-pocketable
No Wireless
Connection
Simple to use
Store-Service
Support
12hr Music
Playback
PERIPHERAL
COMPETITORS
iPod Classic
Hold 20,000
songs (80 GB)
Watch
Photos/Video
Capacity Choice
$249 Pocketable
No Wireless
Connection
Simple to use
Store-Service
Support
40hr Music
Playback
REMOTE
COMPETI-
TORS:
iPod Touch
Hold 1,750
songs (8 GB);
Watch Video/
Photos; Multi-
touch Screen
Capacity Choice
Multi-touch Screen
$299 Pocketable
Wi-Fi Connection
Simple to use
Store-Service
Support
22hr Music
Playback
CUSTOMER EXPERIENCE OF COMPETITORS FOR APPLE’S IPOD NANO
GURUS
Market Segment (Customer Problem/Goal): Listen to
Music/View Photos/Watch Videos/Manage Personal Info’
Mission/Vision: “… Apple leads the digital music revolution. …”

IMPACTS
SYSTEM
Decision Criteria:
Needs & Barriers
CURVES
Function/
Content/
Perf./
Knowledge
Quality/
Reliability/
Accuracy/
Efficiency
Brand/
Emotion/
Style/Aura/
Prestige
Customization/
Personalization/
Interactivity/
Fun/Entertain.
Cost
(Price)
Inaccessibility/
Unavailability/
Inflexibility/
Friction/Scale
Complexity/
Difficulty/
Support/
Range/Risk
Process
Time/
Delay/
Age
WEIGHT
(IMPORTANCE)
Given Product:
iPod Nano
Hold 1,000
songs (4 GB)
High quality Apple Brand Color/
Capacity Choice
$149 Pocketable/
No Wireless
Simple to use/
Store-Service
24hr Music
Playback
CUSTOMER
EXPERIENCE
CURVES
10
8
6
4
2
0
CUSTOMER EXPERIENCE CURVES FOR APPLE’S IPOD NANO
How to Zoom In and Out of BUMPs in Core & Peripheral Industries?
KEY -> 1: Low level; 10: Extraordinary level of customer experience iPod Nano
“iPod Shuffle
“iPod Classic
GURUS

IMPACTS
SYSTEM
Decision Criteria:
Needs & Barriers
TACTICS
Function/
Content/
Perf./
Knowledge
Quality/
Reliability/
Accuracy/
Efficiency
Brand/
Emotion/
Style/Aura
Prestige
Customization/
Personalization/
Interactivity/
Fun/Entertain.
Cost
(Price)
Inaccessibility/
Unavailability/
Inflexibility/
Friction/Scale
Complexity/
Difficulty/
Support/
Range/Risk
Process
Time/
Delay/
Age
WEIGHT
(IMPORTANCE)
Given Product:
iPod Nano
6 8 8.5 2 7 6 3 8
Core Compet.
iPod Shuffle
5 8 8.5 2 4 6 2 5
Peripheral Compet.
iPod Classic
8.5 8.5 8.5 6 9 6 4 9
E: Eliminate
R: Reduce
I: Increase Screen Size
Storage
Quality of
Sound
Fun
Entertainment
Price Thickness
Weight
C: Create Multi-touch
Screen
Digital
Media Hub
Wi-Fi Multi-touch
Navigation
CUSTOMER EXPERIENCE TACTICS FOR APPLE’S IPOD NANO
GURUS

FOCUS “PIVOT” PROCESS: VALUE INNOVATION TACTICS (What if … E.R.I.C.?) OUTCOME:
FUTURE
(DISRUPTIVE)
BUS. MODEL
BUSINESS/
GLOBAL VALUE CHAIN
GIVEN BUSINESS
MODEL
E:
Eliminate
R:
Reduce/Replace
I:
Increase
C:
Create
INPUT (SUPPLIERS/
MATERIALS/ENERGY)
ELEMENTS
(EMPLOYEES/
MACHINERY)
Staff/
Apple Brand
PROCESS
(Bus. Process/
Strategies)
Hardware Design/
Software Design/
Marketing
OUTPUTS:
PRODUCT/SERVICE
iPod Hardware/
iTunes Software/
Content &
Agreements
Screen Size; Storage;
Fun; Entertainment;
Thickness; Weight;
Price
Multi-touch
screen; Digital
Media Hub;
Wi-Fi
RETAILERS/DISTRIB./
CHANNELS
iTunes; apple.com;
Apple Stores/Others
CONSUMERS/
CUSTOMERS (Experience)
Mass Market
ENVIRONMENT
- COMPETITORS (Industry)
- PARTNERS (Complementors)
- INVESTORS (Revenue/Cost)
- PUBLIC/SOCIETY/Enemies
- GOVERNMENT/NGOs
Record Companies/
Original Equipment
Manufacturers
(OEMs)/…
BUSINESS MODEL PIVOT FOR APPLE INC.: iPod - 2001
SYSTEM
(INDUSTRY/BUSINESS) GURUS
Market Segment (Customer Problem): Commoditized ProductsMission/Vision: “… Apple leads the digital music revolution. …”

ITENN4 PART-WISDOMSOURCING MAP 5 PART-WISDOMSOURCING MAP
1 PART-WISDOMSOURCING MAP
CLASSIC VERTICAL MAP PAIN-DELIGHT MAP
WISDOMSOURCING MAPS:
Family of Wisdomsourcing Maps
(Zoomable Idea Organizers) for
Facilitating Collaboration, Ideas
Management, Creativity, and
Customer Problem Solving
CLASSIC HORIZONTAL MAP
GURUS
WISDOMSOURCING MAPS FOR
Visually Facilitate Collaboration, Ideas Management, Creativity, and Customer Problem Solving

ABOUT THE AUTHOR
GURUS

Inventor of over 40 Tools for
The Wisdomsourcing Trilogy –
Facilitating work in the areas of
 Business Model Development
 Business and Strategic Planning
 Product & Service Innovation
 Performance Management
Inventor of “The Fractal Grid”
This technology, which has US and
International patent-pending, can be
used for visually organizing and
Prioritizing massive amounts of
information such as in search
engines, social networks, and
other communities on the Internet
 Visual Problem Solver
 Speaker & Consultant on
Business Model Development
 Inventor of The Wisdomsourcing
Trilogy, a Customer Problem Solv-
ing Suite for Collaboratively
Designing Oh My God-Strategies,
Products, and Business Models
Founder of the Wisdomsourcing
Group, an online Global Think Tank
for collaboratively improving
customer experiences and resolving
tough dilemmas
Organizer & Coordinator of Wisdom-
sourcing survey involving over 200
professionals from over 30 countries
CONTACT
Dr. Rod King: California, USA
Cell: (559) 248-6230
rodkuhnking@sbcglobal.net
http://twitter.com/RodKuhnKing
 B. Eng. (Hons) in Civil Eng.
 Master of Infrastructure Planning
 Ph.D. in Regional Dev. Planning
 Postgraduate Certificate in
Advanced Academic Studies
 Over 20 years of experience in
creative problem solving for
multi-disciplinary projects
Dr. Rod King
Visual Problem Solver,
Inventor & Magician
 Inventor of first software that
wholly invents magic tricks
 Inventor of several magic tricks
 Author of “Trickanalyzing the
Close-up Magic of David
Copperfield” & several articles
 Winner of several championships
in chess and table-tennis
 Founder and former CEO of
Galaxy IT, Inc., a venture-financed
visual search engine business
 Major contributor on creativity to
the multi-author book, “Research
Methods for Postgraduates”
 Former Lecturer
BIOGRAPHICAL SKETCH
Background Information on Dr. Rod King, Creator of Business Model Development (BMD)
GURUS

• Rod King (2009)
• Global Collaboration
• Visual Problem Solving
• Practical Impossibility Thinking
• Wisdomsourcing Maps
• Wisdomsourcing Canvas
• Customer Experience Map
(Pain-Delight Evaluation of Trade-off)
• Wisdomsourcing Deck
• Manifesto for Wisdomsourcing Game
• Alex Osborne (1953)
• Rules for Brainstorming – No criticism
during idea generation
• ‘Blue Sky’ Thinking and Ideas
• Jeff Howe (2006)
• Crowdsourced Goods and
Information Products
• Off-site Tools for Strategic
Analysis and Problem
Solving
• ‘Ad hoc’ Group
• Unlimited Number of Volunteers
• Peer Production; Documentation
• Open Innovation and Value Chain
• Prosumers: Consumers who participate
like employees/producer in a business
• Competitions; Contests; Prizes
• Recognition; Reputation
• Organic Process
• Online Collaboration
• Collaborative Idea Generation
• 1D-Evaluation; Voting
• Myriad Generated
Ideas
• Offline
• 1 Physical Location
• Formal Group
WISDOMSOURCING
3.
CROWDSOURCING
2.
1.
BRAINSTORMING
EVOLUTION OF WISDOMSOURCINGGURUS

THE CUSTOMER DEVELOPMENT ROADMAP FOR BLUE OCEAN STRATEGISTS

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