"To fundamentally shift the strategy canvas of an industry, you must begin by reorienting your strategic focus from competitors to alternatives, and from customers to noncustomers of the industry."

Most likely, there are a lot more people who DON'T buy from you than do. If you can sell to a sliver of all the people who don't now buy from you, the opportunity is massive (at least). Here's an example:

I went to the circus once. I took my son. He was about seven years old. He's 30 now and I've never been back to the circus. You'd have to say I am NOT a circus customer. But I have attended seven performances of Cirque du Soleil in the last few years. At an average cost of about $125.00 per ticket. Cirque didn't try to steal customers from Ringling Brothers – Cirque focused on attracting non-circus customers, guys like me. And by all indications, it worked.

Let's ponder these questions: If we added (fill in the blank) to our value proposition, could we attract a large number of customers who don't currently even consider us? If we added (fill in the blank) to our value proposition, would our product/service be remarkable? If we added (fill in the blank) to our value proposition, from what industry other than our own could we attract customers?

I've been thinking more about value innovation, the concept introduced in Blue Ocean Strategy. Value innovation reduces a company's cost structure while at the same time improving its value proposition to buyers. So, I'm thinking ... sounds good, but has it ever worked?

Seems like it has. Southwest Airlines did away with in-flight meals and assigned seats. It seemed like heresy to the legacy carriers, I'm sure. But as a result of what it eliminated, Southwest needed fewer employees, less time to board the flight, even fewer airplanes. Their costs were and are dramatically lower than the competition. Then they cut fares and added fun – improving the value proposition for the customers.

And how about what we once called "service stations"? You know, those places that sold gasoline, cleaned your windshield and worked on your car? Well, they stopped cleaning your windshield and working on your car, again lowering their costs. But then they stuck a little grocery store in the building, improving the value proposition by adding convenience.

Maybe Bob Seger had a point when he said:

Well those drifters days are past me now

What to leave in, what to leave out

Products and services can be remarkable in many different ways. One way is through a strategic logic called value innovation. In Blue Ocean Strategy, authors Kim and Mauborgne say:

"... instead of focusing on the beating the competition, you focus on making the competition irrelevant by creating a leap in value for buyers and your company, thereby opening up new and uncontested market space."

Uncontested market space. Wouldn't that be nice? If it sounds impossible, think about this – 30 years ago these multi-billion dollar companies/industries/products didn't exist: FedEx, minivans, iPod & iTunes, snowboards, cell phones, Starbucks, home video & DVD.

Sure, some of these involved new technologies and maybe you're not a technology company. But others involved innovation –the recombining of existing resources to create a new capacity and new value. Cirque du Soleil recombined circus, theater and musical components to create a new entertainment phenomenon.

Cirque created a leap in value for buyers by presenting a new take on an old concept, the circus. (Starbucks did much the same thing for the coffee shop). And Cirque create a leap in value for their own company by eliminating a huge cost component, live animals.

One possible road to remarkable is to ask yourself what features/costs you could eliminate in your business that would have little or no negative impact on your customers – while at the same time adding features that provide a leap in value (enjoyment, convenience, utility, status?) for your customers. It's not impossible, but it's probably hard. Hey, nobody said building a Kick-Butt Company was going to be easy.

What's it take to build a Kick-Butt Company? That's the question that's been on my mind more or less constantly for almost a year. I'm going to explore that question on this blog. Explore being the operative word.

First things first: What's the definition of a Kick-Butt Company? Hmmm... Seems like it has to have (at least) the following characteristics:

A remarkable product or service ...

Big, fat, sustainable margins ...

Purpose that provides significant meaning for employees ...

An incredibly satisfying work environment ...

What else?

You probably won't file this under penetrating insight, but music makes my life better. Over the last few days I've bought some old songs on itunes. I built a couple of playlists, loaded my ipod, and all of a sudden a dreary day brightens up a little. Not true. It brightens up a lot.

In The Art of the Start, Guy Kawasaki exorts us to MAKE MEANING. He says:

"The best reason to start an organization is to make meaning - to create a product or service that makes the world a better place."

Over the last few days, Steve Jobs and the entire ipod, itunes, iphone, Apple crew have made my world a better place. The cynical among us might think it's all about commerce, and that's certainly a part of it. But think for just a minute about this - those people put a song in my heart when I was having a pretty tough day. That's meaning if I've ever heard it. So I say, Thanks, Steve.