Value innovation is a term that we're going to take a look at and study, in the context of thinking about entrepreneurial opportunity analysis and new venture creation. Within this, value innovation is the eighth element of the opportunity canvas, and so we're going to spend some time exploring that term today. To define value innovation, what we're talking about is tools and techniques and approaches to recognize that we may have big ideas. But, as entrepreneurs we may have scarce resources, and within that, particularly for entrepreneurs, it's important to be efficient in our use of these resources and to be discerning of how we spend our limited time and our limited finances. Value innovation is a particularly valuable mindset and tool in the context of value curves, for being able to really understand the landscape of our competitors, what's of value to our customers And thereby how we can compete and where to invest. Value curves are really the tool for developing and delivering value innovation, so a value curve is a diagram that compares certain products or services in selected factors on a relative scale of low to high. It may when we look at those factors reference features or benefits or price points or brand or location or access or a variety of other factors that we believe important to the customers and to the market. When we look at this by example, we can think about law firms, and traditional law firms illustrated by the blue line. Most traditional law firms are located in very opulent offices, with large teams. They deliver high worked product and have attorneys that are very well credentialed and very well educated. They come at a cost, and thereby law firms are oftentimes one of the highest level of expenses that entrepreneurs experience. Be it in the initial incorporation and formation of the venture To employment agreements and operating agreements, to patents and trademarks and other elements, to contracts in business and customer related issues. So for a variety of reasons entrepreneurs have turned towards self serve web based firms and tools. The legal zooms the nolos and others that are out there are illustrated by the green line. The green line with these online self serve are not at all opulent. They are not necessarily staffed or human software and forms that have already been generated. The work product may be suitable, but it's unlikely to approach the level of customization and detail and thoughtfulness that you would get if you were working with the traditional law firm. And that's why the work product is approximately a three instead of the ten based on this scale. The attorneys are again involved in the development of the tools perhaps but not someone attractively engaging in But the affordability is tremendous so that's why we see the affordability very high for the self serve web base forms it's because you may be able to get certain things done for tens of dollars or 20 or 30 dollars. May be a 100 or 200 dollars. Instead of thousands or tens of thousands of dollars. So by that measure, that's what we mean by looking at the value curve and contrasting traditional law firms versus self-serve tools for your legal services. Now in between that is this red line of what a new age firm may be, a new age law firm That perhaps is blending some element of self-service with traditional, that perhaps is blending some element of automated versus human. And they may fall somewhere in the middle. There may be an opportunity for them to still have an office and have a team and deliver a high work product under attorney direction. And supervision, but they may be able to do it at a more affordable cost because they've scaled back on some of these other high expense items. So, again, this is an example of a value curve, applied to a very traditional setting of law firms, and how you might think about the different features and benefits and price points. That might be relevant to customers. Now the value of value curves is that it gives us the opportunity to diagram and to put to paper some ideas about competitors. And to think about that single graphic as a point to highlight where there may be opportunities for entrepreneurs. we can think about possible changes in the value propositions, what we can do to change the curve that we may compete on, or even extend that curve, and create some new factors. It also suggest mirrors of focus for entrepreneurs, and where we may want to spend our time if we're trying to enter a new industry or a new market. So in summary, when we think about what to do with value curves, one piece that we'll explore is, elimination. Are there certain factors that we can eliminate? A second element that we'll look at is, reducing. Are there factors that are on that value curve that we can reduce without significantly reducing the value delivered to customers? Another element that we'll look at is raising our degree of execution within certain factors. And then lastly we're going to take a look at creation. Are there new factors we can create? And so when we look at these four collectively, we're going to spend a little bit of time talking about each one forward And thinking about how we can deliver value and innovate on value using this tool of the value curve.
