Problem Solving and Idea Generation for Entrepreneurs

Fall in love with the problem not the solution. Uri Levine, Co-founder of Waze

Entrepreneurs often focus too much on the solution and neglect the understanding of the problem. However, this should be the other way around, the entrepreneur should focus much more on the problem before generating potential solutions.

Sometimes startups start with a business model focused on a market segment and over time they realize that their solution or the market they are focused on is not adequate and they pivot. Such is the case of Aliada and IguanaFix that started serving end consumers and later moved to serving companies.

Every entrepreneur must first focus on identifying opportunities from the end customer’s perspective. The main question is what customer problems can we solve?

From an entrepreneur’s point of view his product or service is that tool that helps the user or customer to achieve his goal. So in the development of the product the most important thing is always to think about what are the objectives that the user or customer wants to achieve by using it and the barriers that he has to overcome. Overcoming barriers involves not only cognition, but motivational and affective factors. So, if you are really meeting that objective, it is because you are really solving the problem and all the barriers associated with it. If not, the process starts all over again. (Funke, 2010)

In doing this it is necessary to cultivate an empathetic perspective with the client, trying to answer the question what can we observe and look for to better understand the problem? In the same way it is relevant to learn from external users by increasing our understanding of the needs and the problem. Experiments can also be considered to expand knowledge about the end customer and then imagine new solutions to meet their needs.

For the process of identifying a problem and generating a solution you can use the Design Thinking tool based on a deep understanding of the customer and their needs. Step one is to generate a high empathy with the customer through curiosity, genuinely capturing their stories, their lives and part of their culture.

The second element and perhaps the most complicated part is defining the problem. This requires identifying the most important issues in the customer’s story. This requires abstract thinking and the ability to analyze the data generated from client observations and interviews. In this phase, the why of the problem should be asked five or more times in order to get to the root cause and identify the barriers that hinder the customer from meeting their objectives. It is recommended that startups start collecting data from their customers from the beginning in order to make inferences about behavior over time.

The customer journey map and customer empathy map can be developed at this stage. Holistically understanding the process and also the thoughts and feelings.

Once the problem has been defined, comes the idea generation and selection stage. The process requires divergence to come up with a wide range of alternative ideas and convergence to select the best option. For its execution, the first part of the process requires being open to questioning and transforming preconceived thoughts, and accepting all types of solutions in the brainstorming framework. For the second part, convergence, each of these ideas can be grouped according to the fulfillment of one or more objectives identified in the problem statement.

This solution has to be put into use through experimentation, the objective is to apply it and wait for failures to arise in the process that lead it to break or fail, which is not an indication of failure, it is simply part of the learning process. The tendency of many teams is to have a high affinity for the first solution and little desire to generate alternative solutions. Generating an ability to adapt to change is one of the main elements for success in this stage of experimentation. When thinking about experimentation, one should look for inexpensive processes and look for a real-world impact with something concrete.

We know that the execution of this process of finding problems, finding ideas and experimenting is easier when a company is at time 0, that is, when it is still in the planning stage of what it wants to undertake. However, the potential impact it can have on day-to-day decision making at any stage of a company’s life makes it a process that should be considered recurrent in the operation. Not only is it useful for solving a particular problem, but it is also a potential new business development tool for finding adjacent problems. As well as a strategy tool to find areas of opportunity where other competitors are already working or to find potential substitutes.

Many startups fail not because of the formation of a good team, nor the enthusiasm to develop a new project, but because of a lack of empathy with customers and a poor understanding of the problem. It is common for entrepreneurs to spend a lot of time on the solution, but they should spend more time on finding the factors that hinder the fulfillment of the customer’s objectives in terms of their process and their motivations.

“Why do so many founders build things no one wants?” he asked. “Because they begin by trying to think of startup ideas. That method is doubly dangerous: it doesn’t merely yield few good ideas; it yields bad ideas that sound plausible enough to fool you into working on them.”- Paul Graham

Note: please refer to the original publication at EL CEO: La resolución de problemas y generación de ideas en los emprendedores (elceo.com)

Hector Shibata Salazar, adjunct Professor at EGADE Business School and Director of Investments and Portfolio at AC Ventures Fund

Ana Maury Aguilar, VC Investor at AC Ventures

ACV is an international Corporate Venture Capital (CVC) fund investing globally in Startups & VC funds.

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ACV is an international Corporate Venture Capital (CVC) fund investing globally in Startups & VC funds.