business

Yesterday I bought a beer at a movie theatre. The bottom of the cup is smaller than the cup holder on the theatre seats, and the cup turns sideways and spills if you try to use the holder.

When a UPS driver couldn’t find my father-in-law’s house, I was prompted to change the address of my delivery and forced to ‘update’ a correct address because the driver was lost. My delivery date went from 1 day to 2 weeks, and I had to spend an hour on the phone to sort it out.

A new printer installed seamlessly for a new Mac. But for an old PC, the only solution is to upgrade the entire operating system, even though HP forces you to install all of their proprietary software.

My pre-booked, 25km Uber ride cost me $57 – the driver got $21. You can tell me about willingness-to-pay and value, and then I’ll tell you that I was served ads the entire time using the app.

It’s not easy to stay passionate about cup holders, shipping and printers, but that’s not the point. Passion can be found in elegantly solving problems that would otherwise create friction in the lives of your customers.

If you need a business idea, companies show their hands everyday; just go about your life and wait until you have to talk to customer service for a large brand or buy a product off the shelf that disappoints you. The friction is where the opportunity is.

It’s surprising how often people look at only costs or revenue and make a decision. That’s a little like sitting on a teeter-totter by yourself and then proclaiming that it isn’t fun. Similarly, you can set out to provide the best handwoven tablecloths, but if you can’t make money, it won’t last long.

There are many pieces of the value puzzle beyond cost and revenue. Similarly it’s hard to measure whether you make the best cheeseburger in town without an income statement.

The trick is to set a vision, and do both.

Ask “how much does it cost?” when you have a meaningful goal in mind. When you crack the code to that cheeseburger, make sure your financial projections are reasonable.

The numbers are useful, and so is your intuition, just make sure you’re not relying too much on one or the other.

Friction and Opportunity

Balance