What's more important: a strong business idea or good execution?
01.11.11 | Posted in Entrepreneurship
A few weeks ago I was a panelist for the closing event of Small Business September, a NSW Government initiative. The guys either side of me were Jeremy Levitt from ServiceSeeking and the gorgeous Dan Joyce (disclosure: he’s my good mate) who founded RedRoom DVD.
One of the questions we discussed was: ‘Is it essential to have the best business idea? Or is it all about execution?’
It’s something I wholeheartedly disagreed with the guys on. They said it was all about execution, and I said it was all about having a viable business idea in the first place.
Dan’s take on the question is that no one knows whether they have the best business idea until they get started on it. And while I agree (I see a lot of people stuck in fear and inertia who’d do well just to give it a go), I’ve also seen plenty of people execute their business ideas well when they shouldn’t have even started. They throw themselves into it, give up their well-paid job, work their butts off to make it happen, and will tell you that they love what they do. Problem is that the idea/business is not viable and they’re flogging a dead horse.
So how do you know if your business idea is going to fly?
- Explain your idea to strangers or people you don’t know well and ask them if they’d buy it (don’t necessarily rely on the opinion of family and friends as they’re likely to be more positive and biased)
- Pitch your idea to venture capitalists or well-established entrepreneurs who have been around the block to see if they think it’s going to work
- Don’t get too attached to an idea for a business – if you are emotional and can’t be swayed then chances are you’re too close to it
- Remember that just because you think it’s a good idea, there may not actually be a real need for it. Test the market first through surveys within your key demographic – are people actually wanting your idea or do you just have your heart set on launching it?
I remember when I first wanted to buy Business Chicks. Every cell in my mind and body was saying ‘go for it’ but I still wanted to make sure it was a good move. I asked friends and colleagues what they thought and if they’d support the concept and I also paid a management consultant to run some financial scenarios to see if it could be viable. His answer was positive and that gave me more confidence to go ahead with the deal.
What do you think? Is it more important to have a strong business idea or be skilled at execution?