Compelling
People who go around trying to invent something fall on
their tails. The best inventions come from people who are deeply
involved in trying to solve a problem.
– Howard Head
In the world today there is this idea going around, popularized
by books like The Secret, that people should never talk about problems
and the pain they cause. Instead, they should be positive and only
talk about opportunities. The promise is that by focusing on the
positive, only good things will happen. Conversely, we are warned
that by focusing on –- or even thinking about –- problems,
pain, and other “negative” things, only bad things will
come to pass. While that idea is of dubious merit in general, it is
simply wrong when it comes to entrepreneurship and innovation.
There is no better way to make people happy than by solving a
problem that is causing them significant physical or psychic pain.
If you study the lives and stories of successful entrepreneurs,
intrapraneurs, and innovators, you will find that most are
unabashed –- and often serial –- problem-solvers. They
make their fortunes by finding, and then solving, good problems.
This principle is understood by experienced venture capitalists,
angel investors, executives, and salespeople. As a result, they are
constantly on the lookout for people who understand the importance
of finding, and then solving, good problems.
THE CHALLENGE OF CHANGE
Why is solving a problem so important?
Solving a problem is important because of the well-established
fact that most people do not like to change.[4]
They live in the same houses. They go to the same restaurants.
They listen to the same music.
Even when things get bad, they still resist changing.
They remain in dysfunctional personal relationships. They stay
friends with people who drive them crazy. They linger on in jobs
they hate.
As a result, change is ultimately the thing that makes or
breaks innovations.
If the customer changes and adopts your Solution, then you
will be successful and If they don’t, then you won’t.
It’s that simple.
The reason that solving a problem is so important to the
success of your Solution is that the existence of a problem
can increase the likelihood that the customer will change. It
can provide the customer with the incentive to change and try
something new.
But not always.
THE PARADOX OF PAIN
Unfortunately, as many entrepreneurs have learned, solving
a problem is not enough to guarantee that people will change
and adopt your Solution.
Thomas Jefferson discussed this phenomenon back in 1776 in
The Declaration Of Independence…
All experience hath shown that mankind are more disposed
to suffer, while evils are sufferable, than to right themselves
by abolishing the forms to which they are accustomed.
In other words, as long as things aren’t too bad,
people are generally more inclined to just put up with them
than they are to change and do something about them. Only
the presence of significant amounts of physical or psychic
pain will consistently drive people to change and adopt
your Solution.[5]
When, at the beginning of this chapter, I said that
experienced venture capitalists, angel investors, executives,
and salespeople are constantly on the lookout for good
problems, I was talking about pain. A good problem is a
problem that is causing the customer significant amounts
of physical or psychic pain and is giving them plenty of
incentive to change as a result. In contrast, an ordinary
problem is a problem that results in things being less than
ideal, but generally not bad enough to give the customer
enough incentive to change.
If you are going to improve your odds of being successful,
it is critically important that you understand the difference
between good problems and ordinary problems.
THE 10X RULE
While they don’t always talk about problems and pain,
experienced venture capitalists clearly understand the
relationship between pain, change, and innovation. For
example, many venture capitalists talk about the 10X rule,
which says that a Solution has to be 10 times better than
the state of the art for it to have a reasonable chance of
being successful. That means that it has to be 10 times
faster, 1/10th the cost, or 1/10th the size. The logic
behind the 10X rule is that only if your Solution represents
an order of magnitude, or 10X, improvement over the state of
the art will the customer be able to make a business case for,
and justify, abandoning the state of the art and switching to
your Solution.
WHAT’S WRONG WITH THE STATE OF THE ART?
One way to explain the problem you are trying to solve, and
establish that it is causing the customer significant amounts
of pain, is to answer the question, “What’s wrong
with the state of the art?” In the case of SalesLogix,
the thing that was wrong with the state of the art -– and
that turned a mere problem into a real opportunity -– was
something called database synchronization. Existing CRM systems
couldn’t ensure that the database of every person in a
large organization contained the same information as everyone
else’s. This caused numerous headaches for organizations
and gave them a reason to consider purchasing SalesLogix. In
fact, this problem was causing some organizations so much pain
that they committed to buying SalesLogix long before it
was finished.
In the SalesLogix elevator pitch, we spent a significant
amount of time talking about both the problem and why we were
qualified to solve it (e.g. our credentials). One way we did
this was by naming our chief competitors and then explaining
their limitations...
On the one hand, you have contact
managers like Act that
salespeople love but that do not allow people to share
information across a large organization. On the other hand,
you have high-end CRM systems like Siebel that scale to
support the needs of hundreds or thousands of users but
that salespeople refuse to use.
This was an extremely successful approach because it
helped to establish not just who we were, but did so using
products with which the audience was already familiar.
WHAT IF THERE IS NO STATE OF THE ART?
Sometimes, explaining what’s wrong with the state
of the art doesn’t work because there is no state of
the art; there is no existing solution to the problem you
are trying to solve. In that case, one way to structure an
elevator pitch is around a short scenario. This is the
approach I took when developing an elevator pitch for this
book, which is really the first of its kind. In the elevator
pitch for Elevator Pitch Essentials, I first lay out a
common, and relevant situation...
When you are selling an idea for
a new product, service,
project, or other Solution, you frequently meet people who
can help you achieve your goal, but do not have the time to
give them a complete, detailed presentation. That includes
situations like…
• Running into an executive
in an elevator.
• Meeting an influential person in
a bar line.
• Being introduced to a potential
investor.
• Introducing yourself to a group of people.
I then explain the challenge that such a situation
presents...
Unless you want to come across as boorish and self-centered,
you only have a few seconds –- or in the best case a
couple of minutes –- to get your point across. As a
result, you have to be prepared to give someone a quick
overview of your Solution and leave the details to later.
I then explain the problem that people are faced with...
The problem is that too few people are prepared to handle
those kinds of situations. As a result, they let opportunity
walk out the door.
I then set up Elevator Pitch Essentials as the solution to
that problem...
Elevator Pitch Essentials teaches people how
to handle those kinds of situations.
While it is usually better to name the state of the art if
it exists, in many cases that simply isn’t possible. In
that case, the best approach to structuring your elevator pitch
is to do what I did in the Elevator Pitch Essentials elevator
pitch and use a short scenario that people can relate to and
that clearly explains the nature of the problem.
Copyright Notice
This document is
copyright © 2009 Chris O'Leary and the LIMB Press LLC. It
is licensed for personal use only. Any organizational or
institutional use must be approved by Chris O'Leary.
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