In the course of any given year, an entrepreneur is presented with anywhere between 5 and 500 ideas that could be developed into a stream of revenue. However, most ideas should not be acted upon. You can’t do everything and maintain an advantage in the marketplace. So what can you do to evaluate ideas in a systematic way?
A wonderful tool to help you evaluate your ideas is an idea matrix. I use a matrix to help me line up potential projects with my own personal goals and values.
Section 1: The Power of the Idea
Ex 8: Evaluate Ideas (Cont.)
Challenge: Idea Matrix
Step One: Using the Internet, identify a list of values. Examples of values are time, money, family, power, and freedom. Look at the list carefully and choose your top 10. Don’t forget to quote your source. In an MS Excel Spreadsheet or an MS Word table, list your top values down the left hand side starting with your most important values at the top (see the example below of some of my top values). Across the top, write in a list of the opportunities that you are faced with. (Note that you can also do this on a simple sheet of paper. Also, if you aren’t currently considering any ideas, make up 5 possibilities, and complete the assignment as if you were evaluating them.)
This is an example of a matrix that I’ve developed. Now you can start to fill in your evaluation of whether or not the opportunity meets the values that you possess. I like to use a scale from 1 to 10 with 10 being the most valuable. Then I add up my scores.
But I’m not done yet. You must remember that every business differs in its likelihood of success. Therefore, you will want to think objectively about your ability to succeed in each venture. If you have trouble with this, then it would be helpful to have an outside opinion such as a business person you trust. I give each opportunity a percentage of how likely I am to succeed with the idea. Then I multiply my score by the percentage until I get my final number.
In the example on the left, you can see that “Launch an online business” would have been my best idea, but I know that making money on the Internet is extremely difficult. Therefore, the likelihood is much lower and it means that I would be better off starting a business to sell flavored coffee. This option would be the best choice for me because it meets most of my highest values, given my current situation and has the highest probability of success. I did not choose working in a restaurant because although I’d be guaranteed an income, I would be unsatisfied and my heart would be in other ideas.
Note that each person’s idea matrix is highly personal, based on the values that are important to them and the given situation in their life at that particular time in history. For some people, given their situation, getting a job in a restaurant would be a life saver for them and it indeed might be the door that the Lord wants them to walk through at that time.
I used this matrix to turn down a job once, even though I was out of work for a long time. The reason is that the job offered to me would have tied me up with so many hours that I wouldn’t even have the time or energy to be with my family. Although I needed the money, my family was a higher value to me and so I turned down the job offer.
It wasn’t just my idea. My wife and I prayed about it and we sensed the Lord leading us not to take the job. That’s how wisdom and intuition work as a team.