Sunday, July 24, 2011

Use companies as incubation hosts - deliver software through professional services projects

There are a million GREAT software ideas.  There are also millions of companies out there who could *greatly* benefit by applying these software applications to their businesses/operations.  But how do these ideas get built/realized and how to companies adopt them?  Professional services organizations like those I want to create.  In this article I'll talk about how things go from "great idea" to "applied prototype" to "service business".  I'll discuss each of these phases and then recommend things you can do to create and sell these types of businesses/organizations.

Great Idea.  In the beginning there's a good idea.  Let's say that our good idea is to provide a restaurant's customers with a "mobile app they can use to order, replacing the wait-person".  The restaurant patrons use their SmartPhones or Tablets to order from the restaurant menu while there.  The patrons launch the restaurant app, pick their location, identify their table, and then start requesting services from the kitchen.  The app would talk to a service that the wait-persons/kitchen staff use to fulfill orders and requests.  They, too, COULD have a mobile app that allows them to see the requests and mark them complete.

Applied Prototype.  The applied prototype phase is when this technology actually works for *a location*.  The basic service has been proved and the value of such a service has been documented as a case study.  For example, the benefits/drivers for this applied service are: order-taking time reduced, improved customer satisfaction with restaurant, and service flexibility.  The case study would measure and promote these items for example:

  • 50% reduction in order-taking time (via observation/data study)
  • 50% increase in customer satisfaction (via customer survey)
  • 50% increase in ease of organizational change (via management survey)

Service Business.  Now that the service exists once and there is a customer who will speak out for its value (and there's a software architecture to support expansion) this can be turned into a business product that is sold repeatedly.  The idea of it can be sold and it can also be marketed through sales channels and propoganda describing the service, it's value and customers.  During this phase, new customers can choose to get the service themselves and the service provider business can offer pricing to integrate and measure the system for that new business.  If they do it well, they will continue to improve the business and value driver effectiveness for the cost.  They will make money.

So...what does all this mean?  How do you go through these cycles?  Some recommendations:

  1. Have good ideas and be creative.  Think of things differently and as mobile, connected software services.  Talk to your friends, network, brainstorm.
  2. Understand the relationship of the new service to the existing business.
  3. Find early-stage businesses who are willing to share in the risk of developing and applying innovative service solutions and helping prove the value of these types of businesses.  (Sell!)
  4. Use these organizations to (co-?)finance your operations.  
  5. Deliver.
  6. Consider sharing in *some* of the future profits with the financier.
  7. Gain more customers and traction.
  8. Be the entrepreneur, driver, and owner.  Make it happen!

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