Step 12: Determining the Customer’s Decision-Making Unit …
Disciplined Entrepreneurship Workbook Step 12: Determining the Customer’s Decision-Making Unit (DMU)WHAT IS STEP 12, Determining the Customer’s Decision Making Unit (DMU)? Figure out who all the people are who are involved in making the decision to purchase your product – including influencers.WHY DO WE DO THIS STEP AND WHY DO WE DO IT NOW? This analysis starts the process of getting the fundamental knowledge we need to estimate your unit economics and ascertain if yours is going to be an economically viable and sufficiently attractive business.There are various important roles that must be considered in every decision to acquire a new product.By the BookSee pages 139-143 of Disciplined Entrepreneurship for base knowledge on this step.See pages 143-147 of Disciplined Entrepreneurship for examples of how different companies and teams have addressed this step.Process GuideHaving the best product or even a great one is not enough to win in business. It will generate no value and be of no consequence at all unless the end user actually gets the product and uses it. For this to happen, the customer needs to acquire the product.“Customer” is a general term that we are now going to make much more specific. To understand the customer acquisition process, first you need to clearly identify the key people and sources of information involved. The customer is not a monolithic entity, but consists of multiple roles, whether embodied in one person, or several, that constitute a Decision-Making Unit (DMU).Once you understand who is involved in the DMU, then you can look at how to acquire a paying customer in Step 13.The three primary roles in the DMU are:End User: The person whose use of the product creates value for the customer.Primary Economic Buyer: The person who will pay for your product, and will determine whether the value the customer gets from the product is worth the cost.Champion: The person who advocates for your product. This is the person who gets the process going and hopefully keeps it going until it is concluded.These roles reside in actual real people and not general, unspecific organizations. Many of these roles may exist in the same person, which is common in consumer product sales. The roles may be split across three (or sometimes even more) different people in B2B (business to business) products.The roles in the DMU are represented by people for the most part, but especially when it comes to influencers, they can be sources of information like Consumer Reports or Oprah Winfrey’s television shows. In another recent development, today in some places, like the financial services, the decision is being taken out of human hands and instead made by algorithms and computers. We will consider these “robo-decision makers” not to be the norm and as such we will not be dealing with those types of situations in this workbook.To complete this step, use the “Determine the Decision-Making Unit” worksheet to copy over a summary of the most up-to-date version of the end user persona profile, and to build persona profiles for the economic buyer and the champion. Even if the economic buyer and the champion are the same person as the end user, prepare a customized profile for each role because the person will likely have different priorities when acting in a different role. This would also be true for any person playing more than one role in the DMU so multiple personas are not only allowed but recommended in such situations. For each persona, you should identify primary (i.e. strongest) and secondary (i.e. strong but weaker than the primary) influencers. You should also identify, for each persona, who, if anyone, has veto power over the purchasing decision. Veto power can include governmental and company regulations. Remember, the purchasing department of a company is rarely an end user, an economic buyer or a champion (although if you are a low-cost solution it is possible they might be a champion) and is usually only really holding veto power, despite what they might want to have you believe. Most important decisions are made by people with responsibility for the profit and loss, or at least the revenue, of a business or household, so seek them out first. General Exercises to Understand ConceptMobile Phone Example: Consider a cell phone. Who is the end user of that phone? Who was the economic buyer? Who was the champion? Can you think of scenarios where this could be different? Describe those.________________________________________________________________________________________________________________________________________________________________________Medical Device Example: Assume you are selling a medical device. Who are the options to be your end user? Who are some options to be the economic buyer? The champion? Influencers of the end user? Influencers of the economic buyer? Veto power?________________________________________________________________________________________________________________________________________________________________________WorksheetDetermine the Decision-Making Unit (DMU)End User Persona (Step 5)Economic Buyer PersonaChampion PersonaNameTitleDemographic SummaryPsychographic SummaryProxy ProductsWatering HolesDay In the LifePriorities (Top 4 in order)1.2.3.4.1.2.3.4.1.2.3.4.Key Selling Points to this Person1.2.3.1.2.3.1.2.3.Primary InfluencersSecondary InfluencersVeto PowerPrimary InfluencersSecondary InfluencersVeto PowerPrimary InfluencersSecondary InfluencersVeto PowerPeopleOrganizationsInfo SourcesOthersQualitative Summary: How would you qualitatively summarize the DMU in three sentences or less?________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________Note that one of the limitations of this worksheet is that it is static, as the roles in an acquisition process can change over time. As you map out the Process to Acquire a Paying Customer in Step 13, you may find it necessary to create additional persona profiles to encompass the multiple stages inherent in some decision-making processes. ................
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