TECHNOLOGY IS A TOOL, NOT A SOLUTION
I have consistently said (for longer than I care to remember) that, at least for me, there’s a really simple test to evaluate the viability of an idea for a new B-to-B business. Does the proposed product or service save the end user time; does it save the customer or client money; or does it increase their productivity? If so, let’s talk further. If not, take your plan and take a hike.
Now I understand that there are ideas for businesses that are intended to address other social objectives and that you can’t measure those kinds of endeavors solely by their financial bottom line, but that’s not what I’m talking about here. And frankly, those types of businesses are not representative of the vast majority of the proposals that I see every day. So, while there are clear exceptions to every set of rules, I’m sticking with my 3 simple questions until someone shows me a better approach.
And, of course, the ultimate dream is to find a business that does all of the above. It’s not really as hard as it sounds especially today when new technologies are ripping through every old line traditional industry and turning things upside down. I see businesses every day that are disrupting the old ways of doing business simply by taking steps, obstacles and costs out of the old way that things have been done forever and dragging those businesses into the new world.
And what is so interesting to me is that the lion’s share of the opportunities and new solutions (medical technologies are an exception) don’t necessarily involve newly invented or untested technologies – they are nothing more than cases of smart people applying proven and industrial strength technologies to eliminate waste and inefficiencies and improve outcomes. This is the critical difference between invention and innovation. Innovation is smarter, faster, less expensive and less risky than trying to invent the next big thing from whole cloth. Good technology is necessary for great products and services, but it’s not sufficient in itself to get the job done.
The new and inexpensive technologies which are now available pretty much everywhere are certainly enablers of the digital revolution (as is the rise of mobility and constant connectivity) and these tools make the process improvements and new solutions feasible and cost-effective, but it remains true that the real drivers of disruptive change are always the same: entrepreneurs (who probably didn’t know what “couldn’t” be done) and who look at things that everyone else has seen for years, but think something new and different and then go on to build something that changes the whole ball game.
Amazingly enough, once you have the cutting insight that changes everyone’s perspective of whatever problem you’re trying to solve, you discover that the “app” or the new technology is a conduit that is helpful in the process, but it’s generally not the central reason for the appeal and attractiveness of the new approach. A good example is Snapsheet which is using mobile technologies (phones and cameras) to change the way that insurance adjusters do their work. Consumers simply use the Snapsheet app to take a series of photos of the damage to their car and upload it to Snapsheet where a room full of experienced adjusters immediately evaluates the damage and determines how the loss should be handled. Losses can be settled in hours rather than days or weeks. And that’s just the beginning.
Snapsheet is one of those rare companies that are delivering a beneficial solution to auto insurance companies across all 3 of my test vectors. Time, money and productivity.
(1) Save Me Time – Claimants get settlements in hours. They don’t have to waste time sitting around their house waiting for an adjuster to show up. The adjuster doesn’t waste his time (and half a day) driving all over the city to look at a fender bender. In addition, using readily-available data, adjusters can instantly determine based on the age and mileage of the damaged vehicle whether any repair is appropriate or whether they should just “total” the car and write a check on the spot.
(2) Save Me Money – Insurers save boatloads of money avoiding the costs of providing rental cars for their insureds. Transportation and fuels costs shrink dramatically. Faster settlements have less unhappy parties and significantly fewer supplementary payments.
(3) Increase My Productivity – Adjusters can process far more claims every day because they aren’t wasting travel time and gas on useless trips. In addition, they’re sitting in a room surrounded by other expert adjusters instead of being The Lone Ranger standing out in some cornfield or driveway trying to write an estimate. Faster, better, more accurate and fully documented transactions mean happier insureds and employees as well.
But the thing that is so striking is that the major benefits from using Snapsheet don’t really arise from the “app” or the underlying technology – any mobile device that can capture and send images could get the job done – the real value arises from smart (and now obvious) improvements in the efficiency of the adjusting process. This is why the best businesses don’t lead with their technology – they lead with solution selling addressed to known and obvious problems.
PS: “You Get What You Work for, Not What You Wish for”
