The Business Opportunity Map (BOM is a new and well-tested tool that breaks that bias in thinking. It is an engaging, systematic, and effective tool that companies can use to identify and map new fields of play, and eventually build complete business concepts. The BOM organizes disparate and complex information into a simple understandable format. It incorporates market and capability perspectives from inside and outside the organization, provides structure to brainstorming sessions, and functions as a visual communication tool for discussing new business opportunity areas.
BOM relies heavily on idea fragments: a set of sporadic, unrelated ideas that shed light on the user’s needs and experience. The idea is to create a star map of independent idea fragments that would later be connected to address the customer’s needs or understand underlying trends.
Why this tool?
This tool is intended to address two things: Identify underlying trends and Identify business opportunities. It is a useful tool that allows companies to grow by detecting subtle trends in their market and acting upon them before the trends become pronounced, and their solutions become saturated. BOM may also be used to figure out solutions to problems by listing the various pain points of the audience and identifying possible solutions for them.
How to use this tool?
The BOM is comprised of 5 Pillars:
- Marketing (Concerned with the market demands and trends)
- Offering (Concerned with the product and services that the business offers)
- Business model (Concerned with sourcing, partnerships, and expansions)
- Production (Concerned with what and how things are being produced)
- Delivery (Concerned with all the streams of both product and information)
Step #1: Market
Idea fragments generated under this dimension revolve around: Underserved segments, mega global forces, and emerging trends (e.g., social, technological, political, economic, and environmental).
Had paper-based publishers seen the trend shifting to electronic content and online news early on, they would have capitalized on the trend, built online portals, partnered with consumer electronics manufacturers, and adopted a digital marketing strategy to capture online and mobile users. This is an example of anchoring around a technological trend.
Human needs and how they change are an important aspect of innovation. That goes back from identifying who the customer is, to understanding why the customer behaves in a certain way.
Positioning: Seeing where a company stands from a different angle and adopting a new outlook. This is what BiC did by adapting to its market and recognizing its strength in being a cheap disposable plastics manufacturer, rather than a simple stationery manufacturer.
Step #2: Offering
Idea fragments related to this dimension include:
- What experiences does the core offering involve?
- Is it a product, service, or hybrid?
- How is the offering branded?
- What complementary products and services should be introduced to accelerate the adoption of the core offering?
- How can I fast-track the learning curve of new offerings and suppress any ambiguity surrounding it?
- How can I expand the network externalities of the offering to make it more difficult and costly for a customer to switch to the competition?
One reason why the number of Apple and Android smartphone users sky-rocketed was that application developers became more likely to spend their efforts on designing applications (complementary products) that are compatible with both platforms rather than, for example, Microsoft or Blackberry. Therefore, more applications are developed, and in turn, more users buy Apple and Android smartphones making it more difficult for Blackberry and Nokia to catch up. Companies must consider such strategies, and understand that making their product dominant in the marketplace is not only about its standalone value, but also the network of externalities and complementary offerings it creates around it.
Step #3: Business Model
Having a simple and proven business model is key. Simple models win the hearts and minds of people. Idea fragments under this dimension address:
- Ways to leverage the power of crowd-sourcing to engage customers and learn from them
- Building new communities around a brand
- Creating refillable models with inherently higher profit margins beyond the core offering
- Defining new revenue streams and partnering opportunities throughout the product’s supply chain
An example of supply chain collaboration can be seen when Mercedes Benz offered test drives to potential customers targeting its A-class client segment. A good example of crowdsourcing can be seen when the Egyptian snacks company, Chipsy, was successful in building a community around its brand and sourced ideas from its consumers about its future flavors. On the other hand, companies need to appreciate that traditional partnerships rely on filling the gaps that answer the question: what’s necessary? However, the breakthrough approach considers all the possibilities and answers the question: what’s possible? Across the supply chain, companies should develop ideas around questions such as:
- Can we partner on the front-end to make something more profitable?
- Can we partner in the middle to get better feedback from customers?
- Can we partner in the backend to get to market faster?
This kind of thinking must always be in the company’s mindset and embodied in the entire innovation process.
Step #4: Production
Idea fragments addressed under this dimension include:
- What assets, technologies, and resources do we use to create the offering (e.g., equipment, human skills)?
- What processes do we have to create for the offering?
- What packaging is needed to make the offering attractive and reliable?
For example, Egypt-based logistics company, Bosta, has its business concept anchored around efficient hub-based delivery services while offering a service that no other business does. On the other hand, PICO agriculture innovated in their packaging to better suit the needs of the countries they export to. Both examples are production-anchored innovations.
Step #5: Delivery
Most people associate the delivery dimension with the limited context of end-of-product or service delivery, i.e. how to get the product to the consumer. However, creative delivery channels need to be thought of throughout the whole buyer experience cycle. Delivery then is not only involved with the physical transfer of goods, It also starts with the consumer’s decision of buying the product and the reasons behind that purchase. This starts with:
- Raising awareness about the company’s products and services
- Helping customers evaluate the company’s value proposition
- Allowing customers to purchase specific products and services (Marketplaces)
- Discovering the logistics around delivering the offering (Physical delivery)
- Finally providing post-purchase customer support
A final point to consider here while generating the idea fragments is that certain seasonal occasions (e.g., Ramadan, Christmas, Back to School, Valentine’s Day) may be capitalized on by introducing targeted products and services (Valentine’s chocolates, Ramadan Packs, etc.).
By now, we should have sets of spread-out data points that target each of the previous steps. From here, you have two crucial tasks that need to be done: Trend Identification, and Opportunity Identification
Trend identification requires its user to ponder the data points listed and try to find an underlying trend. Perhaps users are starting to rely more on online deliveries as we saw with uber eats. Perhaps users are looking for green and guilt-free products in which case the production, sourcing, and delivery processes may need to be addressed.
Opportunity Identification goes hand in hand with trend identification. Now that we see that there is a trend that is pushing the market towards a certain goal, we can identify key solutions that would address this trend. The solutions may vary in the extent of data points covered by them, and multiple different solutions may be proposed to pick the most fitting one. If the BOM was to be a star map, this stage would be likened to identifying constellations.
After having identified sets of opportunities, we must now pick the one that addresses the most data points on the map.
Case Study:
Norah owns a tailoring company that adjusts dresses for its customers. The usual customer experience so far is that customers go in with the clothes that need adjustments to be tailored for them. Norah’s company then does the adjustments necessary to the dress and has it ready for customer pick up. Norah feels as though there are other ways to grow the company, but cannot quite put her hand on them. She then decides to use BOM to identify market trends and to find ways she can implement to grow her company.
First Norah studied her market. She made the following notes:
- All other tailor shops operate in the same way.
- No branding or marketing is done for tailor shops.
- Customers often order things online (food and products).
- She noticed a trend where people are more accepting of online purchasing.
From here, Norah observed her offering. She made the following notes:
- Norah could expand to making tailored dresses.
- The shop could operate online, providing easier access.
- The website or app could have a feature that helps users find their specific fit or cut type.
- The tailor shop could expand into shirt prints.
- The inventory management could be digitized to decrease the customer wait time of receiving their tailored clothes.
Then, Norah moved to the 3rd step where she studied her Business Model. She made the following notes:
- Partnership with delivery services would increase her customer outreach.
- Partnering with certain brands would allow her to create tailored designs and use their clothes as a base.
- Enabling customers to find out their measurements with a smart camera tool would make the process smoother and faster.
Norah then moved on to step 4 where she studied her production. She made the following notes:
- Certain tailoring techniques could be automated.
- Better packaging could be used to represent the brand.
Lastly, Norah looked into her delivery. She made the following notes:
- Potential customers are unaware of her product due to a lack of branding
- Customers have to come to the shop twice to get service
- The shop is hard to reach
- Several delivery services businesses have popped up in the country
Now, all that is left is for Norah to identify the trends and opportunities. She noted that her customers are dissatisfied with the process of visiting her shop twice simply to get their tailored clothes. She also noted that her brick-and-mortar shop may be hard to reach for some. There was also an increasing demand for online shopping and services. Sarah noted the following opportunities:
- She could perhaps get a more accessible brick-and-mortar tailor shop for people to go to.
- She could also go online and use a smart camera to decide on specific fits for the users.
- She could partner with a delivery company so customers wouldn’t have to visit the store twice for one item.
- She could partner with brands and tweak their clothes to make custom designs for her customers
- Wait time could be decreased by digitizing inventory management
Advantages and Disadvantages of the Tool:
The main advantage of this tool is its ability to identify trends and opportunities in the market while they are still subtle. This allows MSMEs to take quick action before the market trends become apparent and the needs become saturated. However, if there is one issue with the business opportunity map it is that it is difficult to identify the cost of the solution chosen. For that, other tools need to be used such as the four corners analysis.
Click on the attachment below to download the business opportunity mapping template.
Be the first one to comment
Please log in or sign up to comment.