Key Takeaways

• Focus efforts on resolving the most pressing customer issues.
• Begin by succinctly defining the problem in a single sentence before exploring solutions.
• Prioritize issues based on their necessity for resolution, distinguishing between those that must, should, or could be addressed.
• Investigate the methods customers are currently employing to tackle the problem.
• Acknowledge customer apprehensions and guarantee that new solutions are compatible with their existing workflows.
• Target engagement towards customers who demonstrate a real interest and whose budgetary limitations align, concentrating on those with a higher propensity to commit.

Introduction

Every other day a new idea keeps popping into my head on how I can launch a new service within the context of my business. Now when you are flush with new ideas, the challenge is not generating enough ideas but is the idea is good for solving a Tier 1 Problem or not. Over the years, I have realised that most new ideas launched failed due to it not being a Tier 1 Problem.

Considering that we all have limited time and resources at hand, we must focus only on solving a Tier 1 problem. In this blog post, I am articulating the process I have developed after feedback from multiple friends, books, articles and personal experience

Defining the Problem

Last year I began exploring including Video Analytics within my security solutions portfolio. I dedicated considerable energy to detail on how it improves security, reduces manpower expenses and other key aspects. However, when I pitched the idea to my existing customers, I realised that the key problem they were concerned with was the approval of the budget for the procurement of CCTV cameras along with a key goal to reduce security expenses every year. While my customers stated the idea was the need of the hour, it did not solve a key problem they were currently facing

A key lesson that I learnt over the years is that most of us tend to get excited over a solution, with the belief that it can solve some problem at hand. Over time, we focus our energies on the solutions rather than identifying the problem at hand. I noticed a similar approach in most AI startups, which mushroomed over the past year with a focus on solutions rather than solving a problem that I would be willing to pay for. It is what I call ” A Solution looking for a problem”. I fell into a similar trap when working on the video analytics idea.

Hence, even before you start working on any idea, start by stating the problem statement you want to solve. Your focus needs to be only on the problem you are aiming to solve. Ensure that you can articulate the problem within one sentence. Once your problem has been identified, only then proceed to the next step.

Is it a Tier 1 Problem

Once I realised that the budget for the procurement of CCTV was a bigger problem at hand. I shifted my focus on how to let organisations procure CCTV when faced with limited budget availability. Over 3 months, I worked with CCTV OEM, distributors and banking partners, building a rental solution that allows companies to stagger payment over 36 months inclusive of warranty. After 36 months, the CCTV is transferred to the company. When this proposal was put forth, it was appreciated but then apart from a few who went ahead, most were just non-committal about it.

Another key aspect that you need to look at is whether the problem I was solving is in the top 3 problems faced by the company or not. In my case, it was a solution for a problem way down the pecking order and not something that they wanted to solve on a priority basis. Simply put, it was not a Tier 1 problem but maybe a Tier 3 or 4 problem that they are fine living with. It was a “nice to have fixed problem but a need to be fixed”.

Every problem your target customer faces can be categorised under:

• Needs to be Fixed
• Good to be Fixed
• Nice to be Fixed

Unless you are not solving a needs-to-be-fixed problem, most customers will not be willing to pay for your solution

Evaluate Existing Solutions

Once I realised I was solving a nice-to-be-fixed problem, I took a step back to relook at my problem statement to understand why are CCTV’s even being used. As I dug deeper, I realised the real problem at hand was theft control and preventing unauthorised entry into the premises. CCTV was conceived as a solution for this key problem but for most organisations, it was unable to do so.

Once I understood the real problem, I began to examine how most of my customers are currently solving the problem apart from engaging security services from firms such as ours. The conversations I initiated with my customers led me to understand that the focus was more on developing the right process and protocols within their premises. Though highly dependent on strict adherence by security agencies and other personnel, they presented with the flexibility to make changes as needed on the fly without being dependent on external vendors

Identifying Pain Points

Once I gathered information on how existing solutions were aiding them in their security process, I realised that solutions proposed by Video Analytics were indeed solving current pain points but I failed to explain how it aligns with their existing solutions. The solutions proposed were too radical from existing solutions that they failed to convince my customers for a trial or pilot even when at my own expense.

Most people are risk-averse when trying out new products and we tend to fall back to default if a new product or service requires too much of a change. Ensuring that our product or service ensures that 80% of features are at parity with existing solutions while the balance 20% offers a unique proposition allows for lower resistance from customers to undertake a trial of the new solution.

Verifying Budget for the Solution

After addressing all concerns raised by customers, I limited the features on offer to certain areas that provided real value to my customers. The revised proposal allowed me to run a pilot with a few customers to let them grasp how the solution improves their overall security systems while allowing for long-term cost reduction. As discussions went to the next stage on how to take it forward, I faced a big obstacle in customers willing to pay for the solutions. Most were non-commital but few did show genuine interest in the solution. Nonetheless, I was successful in convincing a few customers to procure CCTVs from us but not via a leasing option or add-on video analytics to their existing security systems.

It is imperative that during the discussion stage, limit your focus to only those few customers who evoke a genuine interest in solving the problem while assessing whether it aligns with their budgetary constraints or not. If any customer has not focussed on pricing during discussions, it is a clear sign that they are unwilling to pay. Looking back, only a couple held a detailed discussion on pricing for the solutions I proposed and finally took the plunge to implement the same. If I limited my attention and pilots to only those few customers, I could have maximised my success chances.

Simply put, for most customers the problem I identified as Tier 1 wasn’t truly Tier 1 or existing solutions met most of their needs. Customers who did commit to using my proposed solutions were those who were already utilising a multitude of other ancillary hacks to obtain similar results. Hence, unless you can observe if a customer has worked out alternative means to achieve similar results, your solutions won’t entice them to opt for it.

Conclusion

While a new idea does seem promising to us when envisioned, very few can get customers to take the leap of faith. One key lesson is to always focus on identifying the right problem rather than trying to find a problem for a good solution. Ensure the problem you are solving is a Tier 1 problem else go back to the drawing board. A focused approach with customers with the budget and need are the key ingredients you need to get any new idea accepted.