Getting to Plan B
Getting to Plan B by John Mullins and Randy Komisar is a book about transitioning from an initial idea, your "Plan A", to a subsequent idea, "Plan B through Z", with a better product/market fit.
The authors introduce several key terms that are used throughout the book, including analogs, antilogs, leaps of faith. The use of dashboards is also a key concept and many examples in each chapter are used to demonstrate their value.
Analogs and Antilogs
Analogs are examples of companies, in the same industry you seek to do business or a different industry, that have key similarities between how they do business and your prospective business model. Antilogs are the opposite - what you do not want to replicate from other organizations. The mixture of analogs and antilogs helps to define your business model.
Analogs and antilogs are intended to produce a basic level of evidence that the way you plan to execute your business has already been proven by other currently operating businesses.
Leaps of Faith and Dashboards
Aspects of a business that are not "proven" by analogs and antilogs are leaps of faith. Leaps of faith are hypotheses that must be proven if the business is to work properly. Dashboards are used to constantly monitor the leaps of faith. Leaps of faith change from high-level to granular through multiple iterations of dashboarding and modifying the business based on the results achieved (or not achieved).
One of the major concepts hammered home by the book is to test and dashboard the most fundamental hypotheses about your business model first. If you and your co-founders are wrong about a key hypothesis in your business model then smaller assumptions will not matter. Test the biggest questions first, prove them out, then evolve your dashboard to cover the more granular assumptions.
Business Model
Six chapters are devoted to understanding your business model in pieces and then how they fit together. Figuring out if there is a way to run your business differently than industry incumbents can lead to a sustainable competitive advantage because it is usually difficult for existing businesses to change parts of their established business model. The five models that Getting to Plan B covers are:
- Revenue
- Gross margin
- Operating
- Working capital
- Investment
Takeaway
The book provides a solid bridge between entrepreneurship and "traditional" business concepts that would be taught in an MBA program. The examples were interesting and drove home each of the concepts. It would have been a good idea to include examples of business model failures. For example, where did changing the gross margin model in an established industry turn out to be a really bad idea and why?
Overall Getting to Plan B is a good supplement to books like the Lean Startup and The Startup Owner's Manual Strategy Guide. This book provides a different perspective that is not seen in those two books or similar Lean Startup resources.