Quizes 1-8

VPD: Not on Quiz Innovation Games popularized by and what are they (3)

--Popularized by Luke Hohman to help you design better VP by using collaborative play with your potential customers 1) Speed Boat: help verify understanding of customers pains a) Customer needs to state the problems, obstacles and risks holding them back using the analogy of a speed boat held bank by anchors -- large poster with speed boat at sea --Identify pains as anchors --Analysis by comparing these with what you previously understood 2) Product Box: customers design a product box representing the VP they would want to buy from you. You learn what really matters to them and what features they care about --Design -> workshop with a cardboard box and ask them to design --Pitch -> make customers pitch product to you --Capture -> note the messages, features and benefits they mention 3) Buy a Feature: more sophisticated to get customers to prioritize among a list of predefined VP features. They get a limited budgets to buy preferred features --Select and price features --Define the budget --Have the participants buy --Analyze outcomes

BMC Not on quiz: 5 Different Customer Segments

1) Mass Markets 2) Niche Market 1) Catering to specific, specialized customer segment 3) Segmented Markets 1) Focusing on groups with different needs and problems a) Cash, Financial Position 4)Diversified Markets a) Served 2 unrelated customer segments b) Varying different needs and problems c) Ex: Amazon began w/ selling "cloud computing" services 5) Multi-Sided Platforms/Markets a) Serving 2 or more independent customer segments b) Ex: Free Newspaper i) Need a reading base to attract advertisers ii) But needs advertisers to finance production and distribute

"Strategy Intro" Not on Quiz Driving forces behind the rising imperative to create blue oceans

1. Accelerating technological advances 2. Trend toward globalization compounds the situation 3. Result is accelerated commoditization of products and services

"Basic Accounting" Not on Quiz List 12 Basic Accounting Concepts

1. Business Entity 2. Going Concern 3. Monetary Unit 4. Historical Cost 5. Accounting Period 6. Consistency 7. Matching 8. Dual Aspect 9. Reliability of Evidence 10. Disclosure 11. Materiality 12. Conservatism

"Basic Accounting" The article discusses 12 basic accounting concepts and assumptions that anyone interested in financial statements need to understand. Excluding the "Dual Aspect", list FOUR of the other 11 and describe in a sentence or two. If you forgot the answer to Question #1 (Dual Aspect), you can list two additional concepts (6 total) for two potential bonus point

1. Business Entity Financial statement are prepared for a business entity that is separate and distinct from its owners 2. Going Concern Unless evidence suggests otherwise, it is assumed that the entity will continue operations into the foreseeable future. 3. Accounting Period Accounting measures activities for a specific interval of time, called the accounting period. 4. Matching Accounting profit is the net result of the matching of related costs and revenues of a period ii. accomplished via accrual accounting

"Perspective to Entrepreneurship" In addition to "Strategic Orientation", there were five additional critical dimensions of business practice as defined by Stevenson. List the five additional dimensions.

1. Commitment to Opportunity 2. Resource Commitment Process 3. Control of Resources 4. Management Structure 5. Reward Philosophy

The "Business Model Canvas" consists of nine basic building blocks. Sketch the canvas and label each of the nine blocks. For each labeled block, describe it in a sentence or two.

1. Customer Segment 1. Different groups an enterprise aims to reach or serve 2. Heart of a business model 2. Value Proposition 1. Bundle of products and services that create value for the customer segment 2. Reason why customers are loyal 3. Channels 1. How a company communicated with and reaches customer segment to deliver a value proposition Raise awareness, help customers evaluate the VP 4. Customer Relations 1. Types of relationships a company establishes with specific customer segments 2. Driven by i. Customer acquisition ii. Customer retention iii. Boosting sales (upselling) 5.Revenue Streams 1. The cash company generates from each customer segment 3. Revenue streams = arteries if customers = heart Each customer segment has 1 or more revenue stream 6. Key Resources 1. Most important assets needed to make a business model work 2. Allow creation and offering of a VP 3. Can be physical, financial, intellectual, or human 7. Key Activities 1. Describes most important things a company has to do to make the business model work - problem solving, production 8. Key Partnerships 1. Describes network of suppliers and partners that make the business model work 2. Optimize business models, reduce risk or acquire resources 9. Cost Structure 1. Describes all costs incurred to operate a business model 2. Calculated after defining key resources, key activities and key partnerships

VPD The VPC text describes 6 techniques to gain customer insights. These techniques help you understand the customer's perspective when designing value proposition's. Name and describe each

1. Data Detective: utilizing existing reports such as 3rd party reports and trends to gain insight 2. The Journalist: Interviewing to gain own insight to create a lightly validated customer profile. 3. Anthropologist: go into the customers' world (stay at their house, go watch at shops/malls or shadow a potential customer). Find out jobs, pains and gains. Unbiased behavior. 4. Impersonator: become the customer by trying the p/s and gaining insights from the pains and gains experienced 5. Co-Creator: Integrate the customer into part of the process of value creation to learn with them. 6. The Scientist: Have customers participate in experiments (knowingly or unknowingly) to get insights into real world behavior

"Blue Ocean Strategy" What is a "strategy canvas"? How is a "strategy canvas" to be used? What does the horizontal axis (i.e. "x-axis") represent on the strategy canvas? What does the vertical axis (i.e. "y-axis") represent on the strategy canvas? What is the "line" connecting the dots on the strategy canvas called and what does it stand for?

1. Diagnostic and action framework for building a compelling blue ocean strategy Purposes: i. It helps understand the current state of the market and the factors businesses are competing in ii. To propel users to action by reorienting their focus from competitors to alternatives and from customers to non customers of the industry 3. Horizontal: captures the range of factors the industry competes on and invests in. 4. Vertical: captured the offering level that buyers receive across the key competing factors listed one horizontal axis 5. Line = Value Curve -> graphic depiction of a company's relative performance across its industry's factors of competition

"Strategy Intro" Not on Quiz Different areas of the Business Landscape

1. Different Target Market: Rather than competing for the original consumer market it can migrate somewhere else 2. Different Business Model 1. Firm continues to serve the same market but changes the BM 3. Different Positioning and New Target Market 4. Different Business Landscape -> Shifts of the landscape by effecting structural forces (like partnering with a complement) can change the typography of the landscape

"Perspective to Entrepreneurship" Professor Stevenson discusses two historical definitions of entrepreneurship which he argues are both flawed. What were the two "Schools of Thought" on the way to define entrepreneurship according to Stevenson? According to Stevenson, what is the major flaw to each of the two?

1. Economic approach - entrepreneurship entailed bearing the risk of buying certain prices and selling at uncertain prices. Also the concept of bring together factors of production. Flaw: Each term "bearing risk" or "innovation: focuses on some aspect of some entrepreneurs. It is unable to give a definition regarding the whole scope. 2. Entrepreneurial Traits - focuses on personal characteristics like the need for achievement, and risk taking Flaw: search for a single psychological profile is bound to fail. It is easily disproven by current entrepreneurs that do not have all these traits.

"Blue Ocean Strategy" The article discusses the "Four Actions Framework." Describe the four forces and discuss how you can use the framework to develop a business strategy.

1. Eliminate: Which of the factors that the industry takes for granted should be eliminated 2. Reduce: Which factors should be reduce well below the industry's standard? 3. Create: Which factors should be created that the industry has never offered? 4. Raise: Which factors should be raised well above the industry's standards? *It asks for 4 key questions to challenge an industry's strategic logic and business model It allows a company to explore ways to reconstruct buyer value elements across alternative industries to offer buyers an entirely new experience while keeping cost structure low

VPD List 7 Steps in the Testing Process (Know the pic that goes with it)

1. Extract Hypothesis 2. Prioritize Hypotheses 3. Design Tests 4. Prioritize Steps 5. Run tests 6. Capture Learnings 7. Make Progress

VPD: Not on Quiz testing Steps (7) in detail

1. Extract Hypothesis: find out what to test before going out. Develop a business hypothesis 2. Prioritize hypotheses: identify business killers, rank them and test those firsts. 3. Design Tests: using test cards describe hypothesis, outline experiment, define what you are measuring and define a target threshold. 4. Prioritize Steps: Rank the test Cards 5. Run Tests 6. Capture Learnings: with learning cards. Describe the hypothesis, outline outcomes, explain conclusion, describe the next steps. 7. Make Progress: Invalidated = go back to drawing board Validated = Move on to next hypothesis Execute = if happy with the data

VPD The book describes "5 data traps to avoid". Name data traps and describe each in a sentence or two

1. False (+): See things that are not there like believing a pain exist when it does not 2. False (-): Miss things that do exist such as missing a job because an experiment failed 3. Local Maximum Trap: Missing out on real potential by choosing to stay with an early opportunity found through an early experiment 4. Exhausted Maximum Trap: Overlooking limitations where you think an opportunity is bigger than it is 5. The Wrong Data Trap: Abandoning an opportunity because you are searching in the wrong place so the data is wrong

"Business Model Generation" The text discusses "pricing mechanisms" when discussing revenue streams. What are the two types of pricing mechanisms discussed in the text? Describe each in a sentence or two and cite an example for each

1. Fixed Menu Pricing - based on static variables -List Price, Customer Segment dependent Ex: Flat-Rate mail services where all customers pay the same rate for the same type of work. 2. Dynamic Pricing -depends on marketing conditions -Negotiations, Auctions, Yield Management, Real time market Ex: Airline tickets where you pay a different amount depending on the type of seating you want and the number of seats available

Not on quiz: When describing "Customer Jobs", the text distinguishes between three main types of customer jobs to be done and supporting jobs. List the three types of customer jobs to be done and briefly describe in a sentence

1. Functional: tasks that must be completed 2. Emotional: Want to get to a specific state of mind. or achieve a specific emotion 3. Social: Desire to be perceived a certain way or want power

"Strategy Intro" Not on Quiz Threats to consistency

1. Imitation -> Achieving scales of scope 2. Substitution -> be dynamic + fighting back 3. Hold Up: Occurs when the bargaining power of a firm's buyers, suppliers or complements increases allowing them to capture more value -> vertical integration 4. Slack: Lack of discipline and accountability -> careful monitoring

VPD The VPC text discusses that value propositions in business-to-business (B2B) transactions typically involve several stakeholders in the search, evaluation, purchase, and use of a product or service. Each one has a different profile and a different value proposition canvas. Stakeholders can tilt the purchasing decision in one direction or another. List the 4 of the 6 stakeholders given in the text. In a sentence, describe each.

1. Influencers: opinions could count and decision makers may listen in an informal way 2. Recommenders: carry out the search and evaluation process. Formal Recommendations are given 3. Economic Buyers: Control the budget + make the actual purchases. Concerned about financial performance 4. Decision Makers: Make the choice of a p/s and for ordering the purchasing decision. Ultimate authority over the budget 5. End Users: ultimate beneficiaries of a p/s. 6. Saboteurs: Can obstruct or derail the process of searching, evaluation and purchases of a p/s

VPD: Not on Quiz Experiments can Test (3)

1. Interest and Relevance 2. Priorities and Preferences (of jobs, pains and gains) 3. WTP

VPC The book discusses that some business models work only with a combination of several value propositions and customer segments. Name one of the two common types of multiple fits discussed in the text, and describe in a few sentences. Cite an example of a company that needs the multiple fit that you discuss

1. Intermediary Fit -Business sells ap/s through an intermediary thus it is catering to two customers, the intermediary and the end customer which calls for 2 clear VPs. -Ex: Apple sells laptops, iPhones, and earbuds through retailers. To be successful, they need to craft an appealing VP both to end customer and the intermediary like Walmart. 2. Platform Fits -Where 2 or more actors interact and draw value with the same interdependent BM -Ex: Airbnb where the 2 actors are local residents with free space and travelers looking to rent.

VPC 12 experiments in the Experiment Library. Example: Ad tracking Name 4 others and describe

1. Landing Page/Website -> uses a CTA to test out 1 or more hypotheses and determine if customers find value in the product 2. Speed Boat -> another experiment used to determine customer pains by having them list their pains as "anchors" on a boat. 3. Wizard of Oz experiment where you represent how your product will work manually 4. Product Box that calls customers to create a representation of the product they want and then pitch it.

VPD List the 3 types of fit discussed in the text. Specifically, the: name + slang term

1. Problem Solution Fit --> "On Paper" 2. Product-market Fit --> "In the Market" 3. Business Model Fit --> "In the Bank"

VPD List the 3 types of "fit" discussed in the text. Specifically, for each "fit", list the "name" (e.g. foo-bar fit), the "slang" term used for each (e.g. "on-the-exam fit"). Describe the key attributes of each fit in a sentence of two.

1. Problem Solution Fit aka On Paper - Takes place when you have evidence that a customer cares about certain jobs, pains and gains and you want to design a VP around that. 2. Product Market Fit aka In the Market -Takes place when you have evidence that the p/s you created has pain relievers and gains that create customer value - You are validating or invalidating assumptions underlying your VP 3. Business Model Fit aka In the Bank - Takes place when you have evidence that your VP can be embedded in a profitable BM meaning that you can create revenue with the VP and incur the costs to create and deliver it

VPD: Not on Quiz 10 Principles to follow when you are testing

1. Realize that evidence trumps opinion Look at market evidence > opinions 2. Learn faster and reduce risk by embracing failure 3. Test early; refine later Get insights from cheap experiments before thinking through ideas in detail 4. Experiments do not equal reality 5. Balance learnings and vision Integrate test outcomes without turning your back on your vision 6. Identify idea killers Begin by testing the most important assumptions 7. Understand customers first Test gains, pains, jobs before testing what you could offer them 8. Make it measurable 9. Accept that not all facts are equal Customers might say something in an interview that is not really true in reality 10. Test irreversible decisions twice as much

"Strategy Intro" The article discusses "Porter's Forces that Shape Industry Competition." As discussed in the article, what are the six forces? Sketch a simple diagram showing the six forces. In a sentence, define and describe each force.

1. Rivalry 2. Suppliers 3. Customers 4. Substitutes 5. New Entrants 6. Refinement: Complement Image: rivalry in the middle, the others are arrows pointing toward it 1. Intensity of Rivalry: too much aggression can lead to suffering profits. Happens when competitors are of similar size and sell undifferentiated products. 2. Bargaining Power of Suppliers if they offer a Unique product or if they are more concentrated than the industry they serve than they can increase their price as which they supply the industry 3. Bargaining Power of Buyers : Buyers are powerful if they are concentrated or are free to direct their purchase elsewhere 4. Substitutes which are products that all serve the same purpose for customers, can Place a ceiling on the industry's ability to increase prices and grow 5. Threat of New Entrants: Erode profits by increasing competition, introducing alternatives and capturing market share. Enter when there are low entry barriers. 6. Businesses can create value when they complement each other even if they still compete

VPD Not on quiz: Steps of Customer Profiling

1. Select customer segment 2. Identify customer jobs 3. Identify customer pains 4. Identify customer gains 5. Prioritize jobs, pains and gains

VPD: Not on Quiz What do you need to test (4 things)

1. Testing the Circle --Evidence should show: Which gains/pains/jobs matter to customers. 2. Testing the Square --.Evidence should show Which p/s does the customer really want? 3. Testing VP --Goal: do it cheap and quick without implementing it in its entirety -- Test customers' taste for p/s one pain relieve and gain creator at a time by designing experiments that are Measurable, provide insights, and allow you to learn and improve 4. Testing the Rectangle --critical assumptions underlying the business model the VP is embedded in --Get evidence to show the BM is going to work = generate more revenue, less cost and will create a value for customers + your business

"Strategy Intro" Not on Quiz 2 considerations in an BM: + goal of BM

1. The VP 2. The Target Market VP: 1. Be based on either 1. Differentiation in product -> increases the customer's WTP 2. low cost Target Market 1. Defined by Scope 1. Broad 2. Narrow Goal is to maximize the gap between customer's WTP and company's cost

"Business Model Generation" The text discusses that a business model can involve two different types of revenue streams. What are the two types?

1. Transaction Revenues - 1 time customer payments 2. Recurring Revenues

"Strategy Intro" Not on Quiz 3 Characteristics of a Good Strategy (BO)

1. VC has Focus 2. Divergence of VC from comp. 3. Compelling Tagline

"Basic Accounting" What are the three core financial statements? Briefly define the purpose of each statement (i.e. what is the gist of each statement). Indicate for each statement if it is for a point in time or a period of time. Hint: "The Statement of Changes in Shareholders Equity" and "The Footnotes" are NOT one of the three core financial statements!

1. balance sheet portrays the financial position of the company by showing what the company owns and what it owes at a Point in Time 2. the income statement how a company performed during the Period(s) presented and shows whether that company's operations have resulted in a profit or loss. 3. statement of Cash Flows reports on the company's cash movements during Periods of time. It is separated into operating, investing and financial activities.

"Strategy Intro" Not on Quiz (3) How to achieve fit with activities chosen and the VP

1. simple consistency 2. Mutually reinforcing choices 3. Choices should enable optimization of efforts

"Strategy Intro" Not on Quiz Buyer value comes from ? company value? (BO)

3. Buyer value comes from: the utility and price that a company offers 4. Company's value comes from: from the price and its cost structure

"Strategy Intro" Not on Quiz Key Factor to being a complement

3. Key Factor: how easily buyers and the complements (themselves) are able to switch to alternatives i. If buyers cannot easily switch, they give the complements a lot of power ii. If one firm in the complement can switch, they weaken the claims of the other

"Strategy Intro" The 3-D Business Landscape is closely related to a concept introduced in the VPD text for a data trap to avoid. Which one and why?

3. Local Maximum Trap: Missing out on real potential by choosing to stay with an early opportunity found through an early experiment

BMC Not on quiz: Channel Phases

5 Channel Phases i. Awareness ii. Evaluation iii. Purchase iv. Delivery (of a VP) v. After Sales (customer support)

VPD: Not on Quiz Purpose of Split Testing Experiments

AKA A/B testing: unique way to compare the performance of 2 or more hypotheses/options Testing: 1) Alternative features 2) Pricing 3) Discounts 4) Copy 5) Packaging iii. Track the CTA Common: test 2 or more variations of a web page/landing page

"Basic Accounting" Not on Quiz Monetary Unit

Accounting is a measurement process that deals only with events that can be measured in monetary terms

"Basic Accounting" The "Dual Aspect" explains that every transaction affects at least two items in the basic accounting equation and preserves the equation's equality. What is the fundamental accounting equation?

Assets = Liabilities + Shareholders' Equity

VPD: Not on Quiz Eric Ries' Lean Start Up Movement Premise + steps (3)

Based on Steve Blank's Customer development process Idea: eliminate slack and uncertainty from product development by continuously building, testing, and learning in an iterative process 0. Generate a hypothesis i. Start with the VP and BMC to define the critical hypothesis underlying your ideas In order to design the right experiments 1. Design/Build i. Build an artifact that is made to test your hypothesis, gain insights and learn -- Conceptual prototype, an experiment or a basic prototype (MVP) of the products and services you intend to offer 2. Measure i. Measure the performance of the artifact you designed 3. Learn i. Analyze the performance, compare to the initial hypothesis and gain insights

"Perspective to Entrepreneurship" In the article, Prof. Stevenson defines "Entrepreneurship as a ____________________ Phenomenon

Behavior Phenomenon

"Strategy Intro" Not on Quiz Re-constructionist View of Blue Ocean

Blue Ocean strategy is based on the view that market boundaries and industry structure are not given and can be reconstructed by the actions and beliefs of industry players 1. Strategic aim is to create new rules of the game by breaking existing value/cost trade-off and thereby creating a blue ocean 7. Stimulate the demand side of the economy thereby blue ocean strategy expands existing markets and creates new ones 8. It is about driving costs down while driving value up for buyers

"Strategy Intro" The article discusses a "Three-Dimensional Business Landscape." What point is the author trying to make using it, i.e. what does the Three- Dimensional Business Landscape represent and why are they talking about it?

Business Landscape is a useful way to conceptualize the complexities a strategy faces on where to compete and how to do so The landscape metaphor provides a visual for ways in which a firm engages with its environment The metaphor suggests that there are market segments of higher potential profit where the wedge between the WTP of customers and the costs incurred by the business has been widened which is the goal of the firm. It allows the firm to weigh strategic options: a different target market, a different business model, different positioning and a different target market, and a different business landscape in order to reach their goal.

VPD As defined in the text, what is a "Call to Action"? How is a "call to action" used (i.e. why is it discussed in the text)?

CTA: prompts a customer (potential) to perform an actions. that can be tracked in order to test a hypothesis or validate a value proposition Can be like completing a survey or signing up for a newsletter.

"Strategy Intro" Not on Quiz Complement

Company in one industry that provides p/s that increases the Value of p/s of a company in another industry

"Strategy Intro" Not on Quiz Economic profit

Company's residual wealth, calculates by deducting the cost of capital from its operating profit. Also known as economic value

"VPD" Sketch and label the "Value Proposition Canvas" (hint: the "circle" and the "square"). After labeling each, please provide a few sentences describing each of the label quadrants / "pie" sections.

Customer Profile Sectors: (Circle) 1. Gains: 1. Outcomes and benefits customer wants 2. Some are required and expected and some are surprises 3. Functional utility, social gains, positive emotions + cost savings 2. Pains: 1. Anything annoying customer before, during or after trying to get a job done Also any risks, bad outcomes related to getting a job done badly 3. Jobs: What they are trying to perform, complete, problems trying to solve, need they need to satisfy. From their perspective Value Map Sectors: (Square) 1. Products and Services a. List of what you offer b. All the p + s your VP builds on Helps the customer complete either a functional, social or emotional job 2. Pain Relievers a. Describe how your p+s will alleviate specific customer pains b. Focus on pains that matter to customers - > extreme pains 3. Gain Creators a. Describe how your p + s create the gains for customers b. What customer expects, desires and what they would be surprised by

VPD According to the text, Steve Blank coined the term "Earlyvangelist." What is it. There are 5 traits associated with it. List 3.

Customers who are willing and able to take a risk on a new product or service. 1. has a problem or need 2. Is aware of having a problem 3. Is actively looking for a solution 4. Has put together solution out of piece parts 5. Has or can acquire a budget

"Strategy Intro" Not on Quiz Economies of Scope

Decline in costs of production due to sharing of resources across p/s company is offering

"Strategy Intro" Not on Quiz Economies of Scale

Decline in the cost of production per unit as the volume grows

BMC Not on quiz: Channel Methods

Direct and Indirect Direct = Own = Sales Force, Web Sales Indirect = Own = Stores or Partners = stores, wholesalers

"Perspective to Entrepreneurship" In the article, prof. stevenson discusses each critical dimension varying from the "_______ domain" to the "_______ domain" along the continuum

Entrepreneurial doman to the administrative domain

"Perspective to Entrepreneurship" Define "Entrepreneurship" according to Stevenson.

Entrepreneurship is an approach to management that is defined as the pursuit of opportunity without regard to resources currently controlled.

"Perspective to Entrepreneurship" T/F: Prof. Stevenson argues that an entrepreneurship can only be practiced by startups and not well establsihed firms. In a few sentences describe Prof. Stevenson's reasoning to justify his position.

False, Stevenson says that entrepreneurship can be practices by just about anyone because it is a management style that concerns certain characteristics. Thus, a larger firm that decides to opportunity driven or takes on limited resources at a time can overlap into being "entrepreneurial." Certain actions allow companies to overlap into this business model

"Basic Accounting" Not on Quiz Business Entity

Financial statement are prepared for a business entity that is separate and distinct from its owners

"Strategy Intro" The article discusses the purpose of strategy is to create a "competitive advantage". What is competitive advantage?

Firm's ability to cerate a large gap between the amount its customers are WTP and the costs it incurs. TO create this advantage, a firm must perform activities more effectively or distinctively than its rivals

"Strategy Intro" Not on Quiz Structural forces

Give rise to challenges that can be overcome by understanding and adapting to them

VPD: Not on Quiz Purpose of PreSales

Goal: explore customer interest NOT to sell --Customer knows the VP is not made yet --If there is a lack of interest, the sale is canceled and customer is reimbursed Online: --Platforms like Kickstarter --Pledging money Physical --Pledges, letters of intent, signatures --Easier in B2B context

"Strategy Intro" Not on Quiz strategic positioning

Means by which a manager situates a company relative to its competitors

"Strategy Intro" Not on Quiz Economic Logic

Must tie together the chosen activities ensuring the right customer value is delivered at the right cost

VPD: Not on Quiz Steve Blank's Customer Development Process ideology + steps (4) (part of measuring progress)

Premise is that there are no facts in the building, so you need to test your ideas with customers and stakeholders before implementing them A) Search phase: experiment and learn which VP might sell and which BM could work ---> 1) Customer discovery a) Go out to learn jobs, pains and gains. Investigate what you can offer them ---> 2) Customer Validation a) Run experiments to test if customers value how your products and services intend to alleviate pains and create gains B) Execution Phase ---> 1) Customer Creation a) Start building end user demand b) Drive customers to your sales channels and begin scaling the business --->2) Company Building Transition from a temp. organization designed to search and experiment ---> structure focused on executing a validated model

"Blue Ocean Strategy" Define the terms "red oceans" and "blue oceans" according to Kim & Mauborgne.

Red oceans represent all the industries in existence today. This is the known market space where boundaries are defined and accepted and the competitive rules of the game are known. Blue oceans denote all the industries not in existence today. This is the unknown market space where there is untapped, demand creation and the opportunity for profitable growth. 1. Competition is irrelevant

"Strategy Intro" The article discusses "Blue Ocean Strategy" and 2 other strategic frameworks and perspectives. What are the other 2. List and briefly describe

Research Based View: a company's advantage comes from internal resources ; however their value is determined by external forces Emergent Strategy: deliberation and planning does not lead to success rather it is the collision of intent and reality

"Strategy Intro" Not on Quiz Supplier's OC

Smallest amount a supplier will accept for the services and resources required to produce a good or service

VPD Why is Step 4 in the Testing Process necessary?

Step 4 = Prioritize Steps - Rank test cards so you are certain of what to experiment. Prioritize cheap and quick tasks 1st since uncertainty is at its maximum. Later you want to spend more money on experiments that produce more reliable evidence because there will be more certainty at that point

"Strategy Intro" Define "strategy" as given in the article.

Strategy Is the integrated set of choices that positions the business in its industry so as to generate superior financial returns over the long run

"Strategy Intro" Not on Quiz Differentiation

Strategy based on offering products or services that command a price premium because they are superior in quality, reliability and prestige

"Strategy Intro" Not on Quiz Vertical Integration

Strategy in which a business takes over functions that were once provided by suppliers or customers 1. They take over 2 or more stages of production that used to be done by someone other company

"Strategy Intro" Not on Quiz The acid test

The acid test is the imaginary state of the world without the firm to determine if your product is different

"Strategy Intro" Not on Quiz SWOT Framework

Theory that matches a company's strengths against its weaknesses and its opportunities against its threats

"Basic Accounting" Not on Quiz Going Concern

Unless evidence suggests otherwise, it is assumed that the entity will continue operations into the foreseeable future. For preparing + auditing financial statements, Assume that the entity will continue operations into the foreseeable future

VPD: Not on Quiz Measuring Progress

Using Steve Blank's Customer Development Structure + the 3 Fits -Design an Idea (build, measure, learn -> eric reis) -BM and VP proposition Prototype -Assessed with competitors ---> Customer Assumptions Validated = Problem Solution Fit Leads to completion of (1) Customer Discovery -Interest Validated -Preference Validated -WTP Validated ---> VP Validated = Product Market Fit Leads to completion of (2) Customer Validation ---> BM Validated = BM Fit Leads to (3) Customer Creation -Business Model Monitoring Leads to (4) Company Building *Have a graphic of this in binder

"Strategy Intro" Emergent Strategy

View that a successful strategy is less the product of deliberation and planning and more of the collision of intentions and reality, whether external or internal

"Strategy Intro" Resource Based View (RBV)

View that the development of a company's resources and capabilities are the most effective basis of a successful strategy ownership of valuable resources is the source of company's advantage BUT the value of those resources can be determined only by external forces Forces that determine the value of resources: 1. market demand 2. scarcity 3. appropriability: owned by the company

VPD: Not on Quiz Experimental Methods: Indirect Contact

What Customers Do: 1. Sales Actions - Mock Sales - PreSales - Crowdfunding 2. Tracking Actions - ad + link tracking - Landing Page - Split Testing What Customers Say: 1. Detective - Data analysis

VPD: Not on Quiz Experimental Methods: Direct Contact

What Customers Do: learn why and how to imporve 1. Lab Studies - MVP/learning Prototype - Life size prototype - Wizardof oz 2. Anthropologist - Field studies What Customers Say: Learn how many and how much 1. Participatory design + evaluation - Illustrations, storyboard, + scenarios - Speedboat - Product Box - Buy a Feature 2. Journalist - Interview

When describing "Customer Jobs", the text distinguishes between three main types of customer jobs to be done and supporting jobs. List the three types of customer jobs to be done and briefly describe in a sentence

a. Functional Jobs i. Perform a specific task or solve a specific problem ii. Ex: Mow the lawn, eat healthy b. Social Jobs i. Customer is looking to look good or gain status or power ii. How they want to be perceived by others c. Personal/Emotional Jobs i. Customer is seeking a specific emotional state ii. Ex: job security

VPD 4 Consumer Gains

a. Required Gains i. Gains that without, a solution would not work ii. Ex: Phone needs to be able to make a call b. Expected Gains i. Basic gains we expect even if the product could work without it ii. Ex: Expecting phones to look good and be easy to use c. Desired Gains i. Go beyond what we expect ii. Usually gains customers would come up with if you ask them to iii. Ex: having phones integrate with other devices d. Unexpected Gains i. Go beyond even desires ii. Customers won't even come up with them if you ask them iii. Ex: Bringing in touch screens for phones

VPD 3 Consumer Pains

a. Undesired outcomes, problems and characteristics i. Pains = function (something does not work) ii. Pains = emotional (I feel bad every time I do this) iii. Pains = ancillary (its annoying to go to the store for this) iv. Undesired characteristics customers do not like 1) Running at the gym is boring b. Obstacles i. Preventing from starting a job or slowing them down ii. Ex: time, finance c. Risks (undesired potential outcomes) i. What could go wrong

"Strategy Intro" The article discusses that "strategy is a firm's answer to two fundamental questions". What are the two questions?

a. Where should we compete b. How should we compete

"Strategy Intro" Not on Quiz A BM succeeds when it can profitably meet demand with choices that are...

consistent, mutually reinforcing and collectively optimal + when tradeoffs are recognized and accepted

"Business Model Generation" According to Osterwalder & Pigneur, what is the definition of a "business model"?

describes the rationale of how an organization creates, delivers and captures value

BMC Not on quiz: Generating Revenue (7)

i. Asset Sale 1) Selling ownership rights to a physical product ii. Usage Fee 1) More service used, the more the customer pays iii. Subscription fees 1) Continuous access to a service iv. Lending/Renting/Leasing 1) Temporary rights to use a particular asset v. Licensing 1) Giving customers permission to use protected intellectual property in exchange for licensing fees vi. Brokerage Fees 1) Intermediation services performed on behalf of 2 or more parties 2) Credit card companies vii. Advertising 1) Fees for advertising a product, service or brand

Not on quiz: BMC 2 types of business model cost structures

i. Cost Driven 1) Minimizing cost when possible 2) Low price VP 3) Max automation 4) Extensive outsourcing ii. Value Driven 1) Premium VP 2) High degree of personalized service

Not on quiz: 4 Characteristics of Cost Structures

i. Fixed costs 1) Remain same despite volume a) Salaries, rent ii. Variable Costs 1) Depend on volume iii. Economies of Scale 1) Cost advantages a business enjoys as output expands iv. Economies of Scope 1) Cost advantages due to a larger scope of operations

VPD: Not on Quiz What is the goal of Mock Sales

i. Great way to test sincere customer interest --Goal: make customers believe they are completing a real purchases (online context is better) Online: learn by seeing how many click on "buy now" --Ex: Giving price = Committed customer pr Simulating credit card transaction = high commitment by customer Physical: --Introduce product in store that does not exist in a limited number --Sell a product in one retail store in limited amount

VPD: Not on Quiz Types of Functional MVPs (5)

i. Landing Page --Site outlining VP ii. Product Box --Prototype packaging of imagined VP iii. Video iv. Learning Prototype --Functioning but basic v. Wizard of Oz --front that looks like a real working VP --Manually carry out the tasks that the VP would do

BMC Not on quiz: Elements to VP

i. Newness 1) Bringing in something customer segment did not know they needed ii. Performance 1) Improving on an existing product or service iii. Customization 1) Tailoring to a specific individual or customer segment iv. "Getting the job done" 1) Helping customer get certain jobs done v. Design 1) Making a product stand out aesthetically vi. Brand/Status 1) Customers finding value in just using and displaying a specific brand vii. Price 1) Offering similar value at a lower price viii. Cost Reduction 1) Creating value by reducing cost ix. Risk Reduction 1) Reducing risk incurred buy buying new products or services x. Accessibility 1) Making products or services for customers who could not obtain it before xi. Convenience/Usability 1) Making things easier to use 2) Ex: iTunes

BMC Not on quiz: Motivations for Creating Partnerships

i. Optimization and economy of scale ii. Reduction of risk and uncertainty iii. Acquisition of particular resources and activities

BMC Not on quiz: Categories of customer relations (6)

i. Personal Assistance 1) Human interaction ii. Dedicated Personal Assistance 1) Having a specific individual client 3) Ex: a) Account managers w/ important customers iii. Self-Service 1) No direct relation with customers iv. Automated service 1) Personal online profile v. Communities 1) Maintaining online communities so customers can interact vi. Co-Creation 1) Writing reviews Creating content themselves

BMC Not on quiz: 4 Key Resources

i. Physical 1) Facilities, buildings, vehicles, machines, distribution networks ii. Intellectual 1) Brands, proprietary knowledge, patents, copyrights, partnerships, customer databases, 2) Ex: a) Nike, Sony on brand iii. Human 1) Needed in knowledge intensive and creative industries 2) Ex: pharmaceutical companies iv. Financial

BMC Not on quiz: (3) Key Activities

i. Production 1) Designing, making and delivering a product ii. Problem Solving 1) Coming up with new solutions to individual customer problems iii. Platforms/Network 1) Networks, match making, software and brands

VPD: Not on Quiz Purpose of a Landing Page Experiment

i. Single web page or simple site describing VP ii. Customer must perform a CTA that we can track iii. Looking for the conversion rate from the number of people visiting to visitors that perform the CTA iv. Goal is to validate hypotheses NOT to collect emails or sell (that is a by product)

"Strategy Intro" Not on Quiz 2 requirements of strategy

i. Understanding of the business landscapes -> This will let you know if the firm will engage with its competition ii. Choice of a position on this landscapes -> Shapes BM and underlying activities sustaining it

VPD: Not on Quiz MVPs

minimum viable products -prototypes with a min feature set made to learn rather than sell - representation or prototype of a VP designed specially to test the validity of 1 or more hypotheses/assumptions 2. Used to explore potential customers/partners

"Strategy Intro" Not on Quiz Most important determinant of profitability:

new entrants 1. Especially when barriers to entry are high due to economies of scale, brand identity or capital requirements

VPD: Not on Quiz Experiment

procedure to validate a value proposition or business model hypothesis that produces evidence

"Perspective to Entrepreneurship" In the article, Prof. Stevenson discussed strategic orientation as a continuum from "_______________________" (nickname) to "_________________" (nickname) as the level of controlled resources increased.

promoter to trustee

"Basic Accounting" Not on Quiz statement of changes in shareholders' equity

reconciles the activity in the equity section of the balance sheet from period to period. Generally, changes in shareholders' equity result from company profits or losses, dividends and/or stock issuances.