Evaluating a business opportunity / business idea using the P15
4 Jun
When you’re evaluating a new business opportunity/business idea, it helps to consider each of the P15 in turn, looking at what the current situation is and where you can make a difference. I created this summary (below) of the P15 recently, as part of a proposed new template for our value plans. Our value plans are what we use to evaluate whether a new business idea is worth doing, and we’ll look at anything from market research and pricing to the unique selling point (USP) of the opportunity.
This is about looking at what’s currently out there and considering how you can do better. It’s about looking at where you can and can’t make an impact in comparison with your potential competitors.
| Evaluate P15
What’s the current situation/market? What value do we currently offer? (or what value is currently on offer) What are we going to improve on? Consider value creators and value barriers. |
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| Product
Product variety, services, buying experience, user experience, ownership experience, quality, design, simplicity, ease of use, features, packaging, instructions, sizes, customer service, warranties, returns, delivery |
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| Price
List price, costs, inventory turn, economies of scale, discounts, allowances, payment period, credit terms, entry deterring price, delivery, maintenance, repairs, finance, ownership costs, instalments |
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| Place/distribution
Channels, distribution, partners (affiliates, referrals, white label etc.), coverage, assortments, locations, inventory, transport |
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| Promotion
Advertising, publicity, direct marketing, sales force, sales promotion, marketing communications, websites |
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| Penetration
Economies of scale, momentum, market growth, market rivalry, buyer relationships, supplier/collaborator relationships, knowledge, skills, experience curve, access to raw materials/scare resources, location, learning curve, channels, distribution and logistics, price, costs, promotions, brand/perception, quick response ability to competitors moves, synergy of all value creators present by the firm serving a similar segment or from a firms other businesses. |
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| People
Management, employees, culture, knowledge, training, learning, skills, experience curve, access to raw materials/scare resources, location, learning curve, quick response ability to competitors moves, organisational structure, internal communication, priorities, focus, detail. |
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| Policies
Policies relating to: customer service, management, quality, time management, recruitment, internal communication, innovation, employee benefits, departments, regulatory, training, personal development, design, marketing, marketing communications, branding, innovation. |
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| Processes
Processes, procedures, training, value identification, value creation, value communication – effectiveness, value communication – focus, value delivery, value measuring /monitoring, value sustaining |
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| Property
Size, capital, synergistic offerings from the firm (e.g. for Microsoft Windows and other software), technology, access to raw materials/scare resources, location, knowledge, intellectual property/legal protection, capacity, inventory, exit barriers |
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| Perceptions
Brand personality, image, name, strength, public figurehead, positioning, momentum and penetration of brand, quality of products, communications and delivery, look of products, feel of products, energy of products, price, culture, personality, ethics, values, behaviour of staff, feelings of staff about brand, look and feel of tangible objects – vans, offices and so on, value perception, company image, spend on perceptions, public and press perceptions. |
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| Performance
Performance management systems, reward systems, metrics, key performance indicators, targets |
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| Partners
Buyer (customer) relationships, visitor relationships, supplier relationships, affiliates, distributors, resellers, press, reviewers, public, charities, celebrities/sports people, switching costs of other sources of value for buyers, balance of power – closer towards customer or towards manufacturer, concentration – either favours towards customers or towards manufacturers. Threat of integration either towards the customer or towards the manufacturer. |
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| Planning
Direction, strategy, chief purpose, SMART goals, value plans, value mission |
[Include value mission here - this is simply stating in a clear, short statement, the reason the brand, product or service exists in terms of the superior value it aims to provide and to whom.] |
| Priorities
Chief purpose, motivation, goals, aspirations, passion, behaviour patterns, focus, detail, quick response ability to competitors moves |
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| Potential capacity | |
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