Thread: Lack of Need or Poor Execution?

Hey guys, very straightforward question:

When analyzing a business's lack of performance, how do you tell if the cause of failure is due to a lack of need or due to poor execution?

One quick and easy way to determine if lack of need is at fault is to ask your customers directly. In the case of some businesses, prospects have to be qualified in a sales process before they can be converted to customers. Qualifying prospects can be approached in countless ways: surveying, talking to them by phone or in person or via email, and many others.

Poor execution? Sometimes you won't recognize poor execution until someone comes along and does it better. You will know it has been done better by the amount of market share you lose.

What to look for:

1. Lack of need? ask your customers/prospects directly. Don't survey the world, just the people you think would qualify to benefit from your product. Main rule of thumb, though: you know before you start the business if there is a need.
2. Poor execution? you may have to look at any number of areas from how your departments are built and managed, to the customer life cycle, to how well and accurately the product/service's benefits help meet goals and how the features overcome obstacles to goals, to how much or how little or how well you market.

What about during the start up phase (or soon after) when you don't have any (or many) customers? Or is that a red flag that there is a lack of need (assuming sufficient marketing has been done, which is in itself execution)? Are there any good ways in that situation to tell if a startup should be killed (lack of need) or if it just needs to be approached differently (execution)?