MGT602 Technical Article Theme 10

Author: Jawad Hassan, Instructor Business Administration, Virtual University of Pakistan

Technical Articles Theme 10

Title: NABC and Business Model Canvas: Presenting a business idea

Videos: 115-124

Topics Covered

115. NABC: Presenting business idea
116. NABC: The Need
117. NABC-The Approach
118. NABC-The Benefit
119. NABC-The Competition
120. Business Model Canvas
121. NABC-Example
122. Business Model Canvas-Example
123. Discussion Group : angle investor and venture capitalist (Part 1)
124. Discussion Group : the investors' perspective on loan applications (Part 2)

NABC and Business Model Canvas: Presenting a Business Idea

It is important to know that a business idea whether it is sourced from your daily routine, the problems you see in the society or from the unmet needs of the people around you (i.e. water resources, health issues, energy issues, travelling, food and so many other problems) is initially in a raw form. Once you have identified a business opportunity and have prepared a rough business idea sketch in your mind, the very next critical phase it refine that business idea. You need some resources to start that business and it is not necessary that you have all the resources with you to start that business at once. You need others’ help in order to materialize your thoughts. You may find help from your immediate family members, other investors or from the open market sources. In each condition you need to present your business idea in a meaningful, structured and organized way. There are numerous ways to present a business idea but we need to find one which is convenient, easy to understand and smoothly presentable.

Here we present the Need Approach Benefits Competition (NABC) approach, a framework to better structure and present your business idea. NABC is originally presented by Stanford University. As we all know that the effective pitching of your business idea to the potential investors and other stakeholders is very critical. So a very smart presentation of the business idea is an ideal approach to reach potential stakeholders of a business idea.

Stanford Research Institute defined NABC approach as “An important client or market need addressed by a unique approach with compelling benefits when compared against the competition or alternatives”

Let’s understand NABC importance with the help of an example. Suppose feel hungry and sitting in you Virtual University Campus at the lunch time. After a little ponder you have decide to go to a nearest tuck shop, a place that is trusted by you for good quality food with economical price. You avoid to go farther and other market places to avoid unnecessary fatigue and wastage of time.

You need to do a little activity here; that is to attribute this moment of thinking, analysis and decision making (finding a suitable, quick and affordable food option) to NABC components. This activity will enable you to find insights to NABC components from an entrepreneur’s perspective. An entrepreneur actually needs to exactly refine and structure his business idea by considering the Need, Approach, Benefits and Competition factors of the services or goods being offered to the market. NABC components are collectively considered as the backbone of a business idea pitching sequence and content. It elaborates the Need you are addressing (the actual problem in consideration), the Approach you are using to address the issue/need (tools, strategies, plans etc.), the Benefits this business idea will provide (financials, profits, needs fulfillment etc.) and finally the details about the market Competition (competitors, industry dynamics etc.).

Need

It is indeed important to know the individual components of NABC one by one. First component is Need. Need must identify the customer and the market you are offering product to. It is important to remember here that any service or good can sustain, grow and survive whose market exists with its customers and their demands. You need to be very clear with what need of the market or the customers your aim to fulfill. And also need to identify needs with large enough market which can offer sustainable market opportunity. An entrepreneur answers the following question at this stage of NABC preparation.

 What is the need?

 What is its market size?

 Is it sufficient enough to be a potential investment opportunity?

Another thing to be remembered during need identification is that you need to build a solid case on an authentic facts based evidence (either through a survey, a statistical report, a market research or a concrete observation) which argues that a particular need/opportunity exists in the market. Clearly pinpointing the need, its market size, sustainability potential and its scientific evidence are the basic parameters to build a convincing argument in front of potential stakeholders of your business idea.

Approach

After clearly pinpointing the need, the next phase is to finalize the approach through which that need will be fulfilled. Approach discusses the tool, resources, mechanism, plan and strategy to fulfill the needs of the target customers. It is most important to keep your approach simple, smooth, updated and state of the art to meet the dynamic market demands.

Benefits

After identifying the need and devising a sound approach to serve that need now it is the time to list the benefits of the idea being presented to the stakeholders. The benefits package must be unique or sometimes it could be closer to other people’s offering in the same target market. This will be your point of difference to other players in the market. At this stage you have to precisely list down the details about the benefits you are offering to the unserved market and customers. Usually market or customers demand three types of products or services. Customers need low cost, economical, high quality, better quality products and services simultaneously and so you need to give them a reason to switch to your offer and leave the previous one if any. Your benefit must be substantial enough to conquer the market battle. It is to remember here that this portion of a business idea presentation can become a reason to win or lose for you.