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| Thought Leaders: Business |
Special Counsel
Chip Heath and Dan Heath
03/01/2007
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Entrepreneurs seek out investors who can provide strong business judgment,
valuable networks of contacts and, of course, capital. But they also need
something for which they may not explicitly ask: advice on how to make their big
ideas stick.
Entrepreneurs often get lost in abstract visions of the product
or service they have created. They speak of how they are going to “transform the
industry” or “build a new paradigm in customer service.” Yet their mission
statements, synergies and strategies are often ambiguous to the point of being
meaningless. The biggest challenge these innovators face is how to get
employees, business partners and customers to understand their vision, remember
it and act on it. In other words, entrepreneurs must make their ideas
stick.
While a handful of important factors often determine which ideas
stick, the simplest one is being concrete. A concrete idea is one that is
expressed in terms that people can see, hear and touch. One of the simplest
tools for making sure an idea is concrete is what we call the “address test.”
The entrepreneur should be able to list the name and address of an actual
person who will benefit from his innovation.
Every new idea, whether for an
entrepreneurial venture or a new product from an existing company, should be
able to pass this test. As an example of a company that passed with flying
colors, consider Presto, a Mountain View, Calif.–based firm that started with an
abstract idea of using technology to connect baby boomers with their aging
parents. According to Joe Beninato, one of the founders, the need for such a
product or service became clear when Presto’s founding team heard about a Palo
Alto, Calif., retirement community where each day at about 3 pm, residents
eagerly awaited the arrival of the mailman, who brought envelopes and packages
from loved ones. The daily mail call was so important that the retirement center
residents would often check their mailboxes hourly, returning to their
apartments disappointed when the mail had not arrived. While this was good for
physical fitness, it was bad for morale.
Conversations with residents
revealed that most of them were not computer users. Furthermore, the middle-age
children of these retirees strongly indicated they would like to be able to send
email to their parents. To accommodate both groups, Presto designed a “printing”
mailbox: a stripped-down printer that plugs into a phone jack. Children can
email notes or pictures to the Presto service, which formats them and sends them
via a modem to the printing mailbox. Presto! Refrigerator-worthy
letters—complete with grandkid pictures—arrive in the kitchen.
Emotive Engineering
The 3 pm mail call is an incredibly useful and
concrete vision. It passes the address test: The customers for this service are
the kind of people who live in retirement communities in every state. But the 3 pm mail call also tells the engineers what kind of product they must design—a
simple interface for people who do not love technology for technology’s sake.
Finally, it offers a sticky message for its customers—“Pictures of your
grandkids arrive in your kitchen, twice a day!”
The concrete vision forced by
the address test is also useful when the entrepreneurs you are advising are not
tackling business issues, but, instead, social ones. The website kiva.org
enables individuals to use the Internet to engage in a type of microlending to
entrepreneurs in developing countries. The mechanics of the microlending are a
bit complicated, so if Kiva had chosen to dwell on the process, it would have
found it impossible to convince people to invest their resources. Instead, the
first thing visitors see on Kiva’s homepage is a concrete customer: a picture of
someone like Boris Jordanov, who needs $2,000 to buy two refrigerators for a
start-up grocery store in Bulgaria. Kiva’s ability to communicate about its
customers instantly is critical to its success. Indeed, Kiva’s concrete idea is
so compelling that when a segment about Kiva aired on national television, it
generated so much traffic that its servers crashed—the sign of a really sticky
idea.
Sticky ideas are not the only thing that determines an entrepreneur’s
success; the servers still have to keep running. But investors, advisors and
board members are in a good position to ensure that an entrepreneur takes the
first concrete steps toward a successful business: a sticky idea.
 | Chip Heath is a professor at Stanford University’s Graduate School of Business.
Dan Heath is a consultant at Duke Corporate Education. Together they
authored Made to Stick: Why Some Ideas Survive and Others Die. |
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