Take time to “rule out” in business model innovation

A good friend recently went through a battery of medical tests -? MRI, CT, Ultrasound, CT with contrast, EKG, etc. – after some concerning changes in his health. The initial assumption was a serious condition that would require a complicated surgery, but his surgeon wanted to do the tests first.? The doctor explained that taking the time to do these tests would help them rule out what his diagnosis wasn’t before they moved ahead with the surgery.??

And thank goodness they ran these tests! His diagnosis and eventual surgery was less complex than his care team had originally thought.?? My friend was relieved and reassured by the teamwork that the care team demonstrated. The doctors and nurses consulted with each other and sought out other experts for guidance to first get clarity and then certainty.???

One of the specialists on the team even said they were going to reach out to a colleague to “have their thinking challenged.” That’s the kind of mindset everyone facing a serious diagnosis or treatment wants – experts that are so committed to getting to the right answer that they seek out different perspectives that could prove their ideas wrong.???

This willingness to be proven wrong was proof that the care team was patient-centered not ego-driven. My friend was so grateful that his care team didn’t commit to the original diagnosis, which could have resulted in the wrong treatment with long-term implications for his quality of life.???

Imagine if our mindset about assumption testing in business model innovation was as rigorous as “ruling out” in medicine. Over the years, I have had the fortune of interacting with so many early-stage companies and internal innovation efforts. I’ve seen that a key element missing in many of these initiatives is the discipline of rigorous testing in all nine building blocks of the Business Model Canvas. (As a note, I am a big fan of Alex Osterwalder's Strategyzer canvases and system.)?

Medicine doesn't want to make a mistake – the motto “Do No Harm,” comes to mind. In business model innovation, we would avoid investing time and money into no-evidence assumptions if we were as willing as my friend’s care team to test, to rule out our initial ideas, and to do that through rigorous testing of assumptions and debate.??

This mindset doesn’t usually happen naturally, especially when the teams are made up of experts who are accustomed to being right. Just like medicine has processes and protocols, organizations need systems to help identify what we don’t know and get closer to the truth through evidence.????

Medicine has a shared language that helps get everyone on the same page quickly when solving a problem, and we as innovators need the same thing.???

So, I encourage you the next time you are working with a team, utilize the Business Model Canvas to establish a shared language. Use the canvas to do an assumption burst. Document each assumption in the nine building blocks, and then use a 2x2 matrix to prioritize the assumptions. Strategyzer recommends using level of evidence and importance to your business model as the axes. Immediately after, design the experiments and run the tests to validate or invalidate the high-priority assumptions.?

The best time to “rule out” an assumption is before you invest in building a new business model. Making testing a routine part of your business model innovation system will help you save time and money, and it will help build the mindsets needed to seek out evidence that challenge your assumptions.??