The 7 Domain Model for Opportunity Evaluation
Professor John Mullins, Chair of the Entrepreneurship Faculty at London Business School penned a very useful book titled “The New Business Road Test” (2003).
There are numerous books on innovation opportunity evaluation but this one provides a comprehensive way to structure and frame the discussion. It is not so much a check list as much a conceptual framework that guides one through the evaluative steps. The 7 domains are:
Target Segment Benefits and Attractiveness (Market/Micro Level).
Market Attractiveness (Market/Macro Level).
Industry Attractiveness (Industry/Macro Level).
Sustainable Advantage (Industry/Micro Level).
Mission, Aspirations, Propensity for Risk (Team).
Ability to Execute on Critical Success Factors (Team).
Connectedness Up, Down, Across the Value Chain (Team).
In testing business ideas the prospective entrepreneur must be able to evaluate the opportunity from multiple angles and at various levels to determine whether it is truly innovative and investment-ready. There must be a demonstrated need, ready market, and ability to provide a solid return on investment. Is the idea feasible? Is there market demand? Can it be implemented? Is the entrepreneur able to pull together a team and resources to pull it off before the window of opportunity closes?
All these questions must be considered and answered before one embarks on any costly development, let alone venture creation.