What if you could boost your education business with some Impact Thinking? Running an education business is a real challenge for entrepreneurs. Whether we like it or not, it requires reconciling profitability and knowledge transfer through the delivery of invaluable value. And that requires a lot of Impactful Thinking. The question is, how do you turn a business-as-usual education model into an innovative value proposition?
In this post, I have decided to share the insights which I offered to 45 education professionals during a talk organized with Campfire (Hong Kong) on the topic of education and business. More specifically: how to build a value proposition people are willing to pay for?
Running an education business is a real challenge for entrepreneurs because it requires reconciling profitability and knowledge transfer through the delivery of invaluable value.
In essence, education professionals are mission-driven, and their core focus is to produce educational value for their audience.
From a business perspective, however, more factors need to be considered. One, education businesses are – like all businesses – highly dependent on cash flows and thus require that educators keep an eye on the viability of their economic model. Two, educational products always have an expensive price tag for the customer, which means that value must be so important that the benefits outweigh the costs.
A complex equation relevant to many industries.
At the heart of this complex equation therefore lies a very important question: how can you build Impactful educational products that people will be willing to pay for?
Because I work on developing an Impact Strategy for the Law Faculty of The Chinese University of Hong Kong, I was invited to give a talk on that very topic at the beautiful Campfire facility in Causeway Bay (thanks Eva!). In this article, I am therefore making a recap of that talk to provide some insights as to what can help building makes an educational product worth paying for.
Don’t think this article is going to be academic or law-focused, however. Obviously, this talk was largely inspired by ongoing discussions on research and teaching in a legal context. Yet, interestingly, the forty-five people in the attendance came from very varied backgrounds and gave me a variety of opportunities to adapt my message to much more business areas.
Some of the participants had English language businesses. Others taught Chinese to foreigners. Some organized training in the field of aromatherapy or helped their clients with their public speaking methods. Oh, and some had also interpreted the education focus of the talk in marketing terms and came to the talk looking for ways to educate their tax-concerned prospects prior to turning them into clients.
Long things short? There are many ways to build businesses in which education plays a major role. Some are mission-driven. Some are rather profit-oriented. But all have something in common: they see knowledge transmission as being highly valuable. The question is, how do you turn a business-as-usual education model into an innovative value proposition?
Building an education-related business strategy: the basic questions.
As a rule of thumb, any education business would typically face three major obstacles which need to be dealt with whether we like it or not. Think differentiation, innovation, and value creation.
Whatever your way of educating your clients, the first challenge when it comes to building an educational strategy is differentiation.
Go to your supermarket and look around. Your favorite soda brand is out of stock, so which one will you pick? You might have a taste preference, but apart from that it seems fairly safe to say that soda is soda. So how do you make a difference as a soda brand?
Do the test with bottled water and with crushed tomatoes as well. Whatever the product, the point is simple: when the substance is the same and the products look similar, making a choice is complicated – not to say vain. A can is a can!
Now, guess what? The same applies to coffee shops (as one of the participants noted), to bakeries, to car manufacturer and… to education businesses!
Harvard, Yale, Oxford or Cambridge are the big exceptions everyone knows about, but apart from these institutions all universities, language schools and tutoring companies pretty much look the same once compared to their direct competitors.
So, how different is your education business from the competition?
The second challenge is thus innovation because he who innovates has an opportunity to differentiate himself from the competition.
The stake is to start innovating, therefore, and to keep innovating as time goes. Failing which, your business loses traction and you are doomed. Yes, doomed!
I know. My words are a little crude, But they are spot on! Look at Apple, for instance. Is the brand still as innovative as it used to be? These guys changed the world for millions and had a major Impact on the way we use technology. Recently, however, what they have done the most (apart from selling overpriced phones made for nothing in China, I mean) has been to build sumptuous shopping malls to keep attracting clients. Is that still a matter of innovation? (Please decide for yourself, this is just an innocent question).
Now, frankly, the question is difficult because – in contrast with technology products – making innovation visible and tangible in the world of education is extremely complex. In fact, I asked my audience to tell me about their innovative methods and the responses I got were rather hesitant. Innovation? What on Earth does he mean? I’m just teaching…
Some talked about personal development. One person talked about tech and process – which I translated as a user experience improvement. A large range of opportunities to create value for the end-user, said optimistically.
Logically, the third challenge is to create value for the end-user. Beyond words, though, how do we turn education into a super strong value which makes us be and look innovative enough to distinguish us from the competition?
That, my friends, is the one million dollar question, and it’s a tough, nasty one. The reason for that is simple: the way people approach value creation is usually highly problematic.
At the beginning, value is a rather abstract concept. Some want to educate their students, others talk about educating their clients. The pattern is there, but value remains difficult to evaluate critically.
So, what normally happens is very simple: people think that by reducing the price of their products they will give the end-user more value for their money. Except that in reality, in most circumstances this way of thinking is short-sighted and rarely creates value.
In the best case scenario, lowering your price will create an illusion of value in quantitative terms. When the end-users pay less for the same product, chances are that the quality of the product also decreases because the seller cannot support the cost increase.
So? Price competition is not about value creation but a radically different economic model can make a huge difference. Ultimately, what you really want is a qualitative leap!
Think about it this way: would you rather see people talk about your educational product because it is cheap (not too good but cheap so that’s okay, really…) or because it is exceptional in terms of value and therefore sold at a totally acceptable price?
Value creation requires a mindset shift based on Impact thinking.
All things considered, creating value is a matter of operating a mindset shift. Simply put? The best way for an education professional to reconsider value creation is to move from thinking purely in terms of education to thinking in terms of Impactful value proposition. And I call this Impact Thinking.
Of course educating is fundamental. But is your education proposition more convincing and Impactful than that of your main competitors?
This is a difficult question because we – as mission-driven professionals – are rarely comfortable with the idea of questioning our own value offer. In fact, many of us are radically opposed to the idea of reconsidering our educative methods. But here is the thing: there are huge ‘what if’ questions to answer. What if we don’t do it? What if the competition does it before us, actually? There you go. Competition. Value. Business thinking beyond pure education.
Building a Christmas tree (strategize).
The point here is very straightforward: the best way to build an educative value proposition people will want to buy (or won’t be able to dismiss), is all about planning your differentiation, innovation and value-creation process.
I am not getting into more details here as I’ve developed the concept already in another article, but the idea is that what makes a Christmas tree is the preparation and the efforts you put into building a Christmas spirit. Start with a cause and a Wanted Impact, define a message around your proposed solution, and define a variety of steps to move on.
How to do that.
In terms of business, preparation is therefore all about strategy-building, and whilst many entrepreneurs refuse to do that (because they would rather focus on the daily routine) the best way to reach a goal and make an Impact is to anticipate, build, measure and adapt.
To do that, my suggestion consists of combining three distinct but complementary approaches which, when used together, will help to create value that people will want to buy.
One consists in thinking in terms of cause (or vision) and implies identifying a problem, an affected beneficiary as well as the overall Wanted Impact.
The second consists in building a strong positioning for your product. To do that, having recourse to Human-Centered Design methods is a particularly efficient way to identify precisely the needs of the said beneficiary, to generate ideas as to what opportunities arise, to design a value creation prototype, and to obtain an operational Minimum Value Proposition (MVP).
The third consists of applying a business framework to the discussion, which eventually helps clarify the implementation process which will be developed to obtain the Wanted Impact.
1. There is value in meaningful and Impactful causes.
The first step of the Impact Thinking process consists of identifying the Cause your educational product or service fights for.
Pragmatically, a cause requires three elements. One, a rather annoying problem which needs to be solved. Two, a beneficiary (in the form of a community) likely to benefit from any action aimed at solving that problem. Three, a set of Wanted Impacts resulting from the value generated by your product.
Can you win an armed conflict without a strongly favorable public opinion? No. Why? Because the public opinion will not approve a conflict which is not grounded on a very solid and bullet-proof foundation – i.e. stopping another conflict is a good cause to fight for.
The same applies to the development of your educational product. Whether you like it or not, you are unlikely to build a viable strategy if you don’t provide an Impactful solution to a problem which seriously affects a beneficiary, and if you cannot explain what Impact you plan on making.
‘Fighting for’ is a rather strong wording here, but whatever you do, running a business is about putting your time, energy and cash into something bigger than you. If you don’t fight for it, well, nobody else will.
Something people can relate to.
You need a cause to which people can relate, that is to say. At the end of the day, when your potential end-users compares alternative products, they will always seek a form of return on investment. For most people the ROI will first be a matter of pricing, there is no doubt about that. But for many, just looking at the price won’t be enough, and at some point your ability to explain what you are fighting for will also be considered.
If the end-user somehow manages to relate to the educational offer you provide, however, the perceived return on investment will be much higher than if the decision is only about the price.
For instance, if your education business is rooted in a strong self-development dynamic (a frustration affecting a community clearly provides cause), your message will make sense for the like-minded. Is your education business rather focused on fun and entertaining methods and processes? Then you will have some influence over an audience segment sensible to your approach.
Back to my previous points, in other words, having an Impactful cause is therefore a way to differentiate yourself, but it is also a way to innovate and to create some additional (perceived) value for the end-users. Without such an argument, however, the only comparison point will be pricing, and I don’t need to elaborate on what that means for you.
Don’t forget the stakeholders.
Having an Impactful cause to fight for is also a strong selling point when it comes to talking to other stakeholders.
Think about investors, for instance. If you run a business, chances are that you will be looking for further funding sooner or later, yet investors are unlikely to place their money into a project which doesn’t have an identifiable purpose. Beyond investing, in fact, funding parties such as grant providers (public or private) and philanthropists won’t support causeless projects either.
Think also about the by-products which can be delivered to could-be-prospects. For instance, in our case, education comes through teaching, which is itself nurtured by research. Yet, our traditional way of operating has been to focus on students (the primary end-users) when in reality a variety of stakeholders are also relevant from a research perspective. Law firms, NGOs, industry actors and regulators are clearly our wanted interlocutors when we do our work, so why couldn’t we try and use our knowledge and know-how to create some education-based consulting and training opportunities with them?
More generally, an Impactful cause can help with making friends. Think allies and champions, here. Allies will support your work as they can (pushing your posts, telling people about your work, disseminating your recent news and all that). Champions will go much further and put their weight in the balance to help you succeed. But again, a cause worth fighting for will be a sine qua none starting point.
Having a cause worth fighting for is important, but it will have a limited effect if you don’t have a ‘Wanted Impact’ in mind.
The line between a cause and a Wanted Impact is thin, but it matters. For instance, if your education business is about teaching English through innovative technologies, your cause could be to revolutionize the way people learn while your Wanted Impact could be to make a thousand kids more comfortable with English every year.
Examples are particularly easy to find in a mission-driven context, but the same idea also applies to profit-seeking businesses. For instance, if as one of my participants your company sells tax optimization solutions to help entrepreneurs make the most of their efforts (profit-oriented issue and beneficiary), then your Wanted Impact could be to support the growth of a thousand businesses every year – thanks to your educative materials and training offer.
Said differently, therefore, the cause is at the root of your activity and it must convey a strong message regarding why your offer is one that cannot be ignored.
2. Understanding, ideating and prototyping a solution.
Once you have convincingly tied your education business to a cause, the next step is to understand the stakes, to generate ideas, and to come up with a possible solution. Different methods are available to do just that: one focuses on designing to match the specific needs of the beneficiary, the other rather focuses on positioning the resulting solution on the broader market.
Design Thinking and User Experience.
The first method which can (should) be relied upon to develop a solution is a human-centered process known as Design Thinking.
Design Thinking is not very common in the education industry but it is commonly used in startup companies where a lot of reactivity is needed.
In essence, Design Thinking is a powerful and extremely pragmatic process which helps (i) understanding the very specific needs of the beneficiary (User Experience or UX), (ii) producing ideas relevant to that need, and (iii) developing a prototype solution capable of hypothetically solving the beneficiary’s problem very precisely.
The first step is to spend some time with your beneficiary. See, discuss, ask, explore, and understand how they live, what their processes look like, and understand the educational problem they face. Determine what educational help they need (note: what they WANT is not the same as what they NEED), and document your findings. Later, reflect on those findings and develop some very practical insights.
In the case of CUHK law, I had recourse to external facilitators seasoned in Design Thinking and UX work to create a climate of discussion and ideation within the Faculty.
Bringing Post-its, color markers and smiling stickers was a new and radical method, that is for sure. But they also helped to push the boundaries, unlocked discussions and gave us impressive insights as to what could be changed and improved when it comes to developing more Impactful research.
Once you have a big picture of what your beneficiary needs, the second step is to use the insights to ideate, i.e. produce as many ideas as you can with a view to solving the educational problems identified. Regroup similar ideas, compare, make a selection and validate the hypotheses you will want to test.
Think, also, in terms of who the beneficiaries are, in terms of what they want, and in terms of what they need.
These hypotheses will, of course, lead you to narrow down possible solutions.
Tip: the best way to get the ideation process right is to use the help of an external facilitator, as this helps to get some neutrality into the discussion. Get in touch for more information!
Third, build a prototype around those ideas. If your educative solution is creative, build an object with simple materials (cheap, quick and dirty works best). If not, trying drawing and illustrating your possible solution on a large piece of paper, using colors and all that.
You can then use this prototype to test your ideas and hypotheses with your beneficiaries, who will then gain access to a tailor-made solution designed to match their needs very precisely.
Putting the educational prototype in a market perspective with value curve ideation.
Once a beneficiary-focused prototype is ready, the idea is to try and position the possible solution on the broader market. Doing this is important because it helps to make sure that your offer makes sense from a business strategy perspective and that it won’t be refused by the targeted end-user because alternative products already exist. That would be too bad, don’t you think?
A very practical thing to start elaborating an educational product people will want to pay for is to elaborate the value curve of your prototype solution. The concept of building a value curve is clearly inspired from the successive books of the Blue Ocean Strategy series, but long things short the idea here is to draw a map of the market by looking at what the competition has to offer.
As you can see on the picture, you will often realize that some alternative products can offer very similar features, which makes their value curves and propositions very similar and therefore highly competitive.
The key, therefore, becomes to elaborate your own value curve (in green), by reducing or increasing existing features whilst deleting the unnecessary and creating the non-existent. When that happens, your value curve becomes totally independent of the competition, which places you in a unique Blue Ocean position.
Depending on the way you conducted your user-experience work this way of proceeding will give you more or less information as to the value which is effectively created by your product.
For instance, if your UX process was built on extensive field research, chances are that you will have already built your educational prototype by taking into consideration what works or not with alternative solutions. In such a case, the value curve will be relevant to the extent that it should help confirm your initial ideas.
If you have not conducted extensive UX research, however, the value curve exercise is likely to give you rather unsuspected insights as to what alternative options would tend to provide (or not).
In both cases, the value curve will help you clarify your positioning from a market perspective. This will help you narrow down your business opportunities, but this will also help you build an easy-to-communicate message around your product. As per the Design Thinking phase, the best way to operate is however to ask for the help of an external facilitator who won’t have trouble with asking questions.
3. Action plan and Roadmap.
As explained earlier, the third approach which can (should) be used to create a value proposition people will want to pay for consists of applying a business framework to the discussion.
At this stage, you should have the basis of a demand-matching educational product or service, but bringing a dose of business thinking to the equation will help you clarify the implementation process which will help obtain the Wanted Impact.
A very operational part of the process relates to the necessity to build partnerships with a variety of stakeholders. In our case, for instance, such stakeholders could be law firms and regulators possibly interested in using our educational materials and research insights.
Overall the idea is to find allies (happy to help), as well and champions (more than happy to support any way they can) and funders. Again, partnerships need to be planned and considered carefully as part of your ‘Build a Christmas Tree’ work.
You must also think about how you will let the world know about your great educational solution, therefore thinking in terms of dissemination is extremely important early in the process.
For instance, will you write a book? Will it be released online, as guide piece or as a mass market volume? Will you provide actionable solutions, such as online courses or perhaps freely available videos? Will you provide supporting workshops in which people can work on their projects or classes in which they can learn the basics?
By the way, what is your message? Do you have a message at all? Have you adapted that message to your different interlocutors?
MVP, testing and measuring.
A prototype is nothing but a test version. A rough one, in fact. Hence, your next job is to try and determine whether (and how) it indeed solves the beneficiary’s problem from a very practical point of view.
To do that, the most efficient probably consists of developing a Minimum Value Proposition which can basically demonstrate that your solution is operational. If the beneficiaries can use it then chances are that the solution will be increasingly operational.
On top of that, the MVP is also a significant way to obtain feedback along the way (the Lean guys call that Validated Learning, as a matter of fact), which ultimately gives you an opportunity to permanently adapt your solution to the needs, expectations, and demands of the end users.
To do that, you might also consider Developing more hypotheses and milestones – I call them the Key Impact Indicators (KIIs) – and look for opportunities to test them. For real. Permanently
Test the product, confront it to reality, ask people to tell you what works and what doesn’t work. Adapt. Refine. Change. Try the process again, define more hypotheses, test them again and continue. Or abandon. Or Pivot, and move on accordingly.
Sales process, time management, system automation, value delivery…
There are more elements to take into account here, obviously. These do not really apply to CUHK at this stage, but when developing an educative solution and business you should also think in terms of sales process optimization, in terms of time optimization.
System automation and value delivery are also interesting for two reasons. One, they can make your process more profitable, obviously. Two, and perhaps more importantly, they can also help you develop alternative economic models, which, who knows, could help you increase your reach and propagate your solution beyond expectations.
Ultimately, my point is that using Impact Thinking is a great way to build a product people will want to buy, because building a product from a cause, with the support of Design Thinking, and while integrating methods inspired from business strategy are the best ways to make an Impact and reshuffle the cards
The proof is… my whole talk was prepared and built using the approach I just mentioned.
The topic which was given to me by the Campfire team was rather large: developing your education business (with an Impact). So I got in touch with some of the registered participants and asked them what they really expected from my talk. A few questions later, the topic was narrowed down and reshaped in more business-y terms: how to build an educative product (or service) that people will want to pay for?
First, what was originally presented to me as a talk for education businesses (without more information) was turned into a talk on developing an Impactful education business. Said differently, positioning my intervention in terms of Impact Thinking gave me an opportunity to differentiate myself, to innovate with a different approach, and to create value for busy entrepreneurs.
Second, the best way to make sure that the talk would actually fulfill the expectations of my audience was to contact some registered participants to try and understand their expectations. I talked to a few of them and went for the idea of a talk focusing on how to create an educational product that people would pay for.
Third, I developed my talk using the ideation process which I described earlier. Post-its everywhere, big ideas, narrowed-down concepts which eventually turned into a presentation prototype.
Of course, the next step was then to test that prototype with some Impact-sensitive friends (my allies) willing to listen and provide some feedback. I then improved the talk prototype, changed some of the ideas and arranged a couple of points, before asking for another round of feedback.
Ultimately, the comments from the talk’s participants were extremely positive.
The persons I consulted in the first place concluded that the talk had answered the question they had asked me to explore for them, and they even gave me some tips as to how to improve and provide even more value next time.
Even better, some of them did some good advertising outside the room, describing the talk as insightful and inspiring – which honestly is the best compliment a speaker can obtain. What that means, though, is more allies and, hopefully, more Impact. How cool is that?
Last but not least, I want to insist on the idea that we, at CUHK Law, had decided to ask for help.
I could have tried to build this project on my own, but I figured that surrounding myself with smart people would give me a much more powerful way to pass my message to my colleagues.
So we brought some consultants in.
I built a team of complementary experts, in fact. One of them was a business strategy expert who routinely helps entrepreneurs build their own business roadmaps. Another was a culture change specialist focused on transmitting complex messages to teams. Finally, two Design Thinking experts stepped in to help me with the understanding, ideating and prototyping process – and gave a voice to the staff in ways they never considered possible.
There are two takeaways here. First, the best way to improve your model is to ask for help, because bringing someone from the outside is the most efficient way to help you clarify what works and what doesn’t. Second, when you spend most of your time focusing on your routine work, adding a dose of alternative methodology is a powerful way to make a massive step forward.
Integrating some Impact Thinking at the beginning (and throughout) the process is an extremely efficient way to build a Cause by creating Aha! and Wow! moments which make a difference.
Introducing some business strategy into your routine then help with clarifying your positioning.
Adding some Design Thinking to the equation finally help narrow down and build some business opportunities you would have never spotted otherwise.
Are you interested to find out more? Let’s talk, let’s meet, let’s plan a talk, get in touch!