Mullins’ Seven Domains Model
Most new businesses fail – but you probably already knew that. Why is it that most new ventures never really get off the ground?
Mostly, it is due to a lack of planning and forethought on the part of the founder or founders. It is incredibly difficult to succeed in business, and only those who truly think through their plans to refine them as necessary are going to be able to track down success in the end.
Mullins’ Seven Domains Model is designed to help those thinking about starting up a new venture. Before even writing out a business plan, it is recommended to review this model closely.
When viewing your idea through this model, you may or may not decide that you should proceed with your concept. Below is a closer look at each of the seven domains which make up this model. Four of the domains fall into the category of ‘macro’ aspects, while three are considered ‘micro’ points that relate specifically to you and your team.
Right off the bat, you are going to look at just how attractive your target market is as a whole. This is a point, as trying to enter a market that isn’t big enough to sustain your intended business is a venture that is destined to fail. You don’t necessarily want to be trying to create the market on your own – you want to fill a need where the market is waiting to spend. Is the market that you are targeting on the rise, or is it already in decline? Chasing a fading market is going to be tough in the long run.
Sector Market Benefits and Attractiveness
At this point you are going to ‘drill down’ a little bit deeper into the market to address specifically the people you intend to serve. Most products don’t actually appeal to an entire market, but rather just a subset of that market. Who are the people within the market that you are going to be serving, and how many of them are there? You can easily make a mistake by thinking you are going to serve an entire market when you are really only targeting a small set of people within that market. In that case, you are left with a market that is significantly smaller than expected, and your sales will likely reflect that fact.
Getting away from just the market itself, you want to look at the industry as a whole – that means, addressing those businesses who would be your competition should you decide to move forward.
Many people overlook this step because they just assume they will be able to beat out the competition, but that is a mistaken assumption. The industry leaders at the present time have worked hard for their position, and they are not going to give it up easily. Also, it can be a trap to enter an industry that seems too good to be true – because it probably is. In that case, there is likely a reason that there isn’t much competition, and you will soon find out that there isn’t much money to be made in that field.
This is another point that is often overlooked by the would-be business owner. To succeed in business, you not only have to build an advantage over your competition, but you also have to be able to sustain that advantage in the long run. What can you do to make sure that your competition doesn’t catch up to you – or pass you – in short order? If you are going to develop a unique selling proposition that allows you to stand out from the crowd, is there any way that you can maintain that advantage going forward? If you are quickly going to be copied by a bunch of competitors as soon as you start to have success, it might not be worth entering the market in the first place.
Mission, Aspirations, Propensity for Risk
When you come to this point, it is time to look inside to understand what your motivations are, and how you might be able to succeed in this venture. Are you simply hoping to make a bunch of money, or are you truly passionate about the business idea itself? While it is certainly possible to make money in business – that’s the goal in the end – those financial gains rarely come quickly. More likely, you are going to have to work extremely hard for very little money at the start. If you aren’t willing to make that kind of investment, you may be destined to fail. Also, if you are bringing other people into this venture with you, it is imperative that they share your motivation and drive.
Ability to Execute on Critical Success Factors
This domain asks you to think carefully about what it is that is going to determine your success or failure in your venture. What are the key points that are going to have a large influence on how well your business works out in the short and long term?
Critical success factors exist in every business, but they change from organization to organization depending on the market, products, and more. Is the team you have in place – including yourself – going to be able to hit on all of the critical success factors well enough to ensure your success?
Up, Down, Across Value Chain
No business exists on an island. You are going to have to exist within a value chain if you are going to be successful, and the quality of that chain is something that should be closely analyzed right up front. Are you going to be able to get the supplies you need on a reliable basis, and for a fair price? Are there distributors who will be waiting and able to move your products in a way that sustains your model? These factors are somewhat out of your control, but they have a major impact on how your organization can fare once it gets off the ground.
Each of the seven domains listed above is incredibly important to the success of your potential business venture. Take some time to think about each one and be honest in your assessment. This tool may not always give you the answers you were hoping to find, but it can be a great help in making sure you only go forward with business ideas that have a fighting chance to succeed.
- Mullins’ Seven Domains Model is designed to help those thinking about starting up a new venture.
- Four of the domains fall into the category of ‘macro’ aspects, while three are considered ‘micro’ points that relate specifically to you and your team.
- Market Attractiveness: How attractive is the market in terms of size and maturity?
- Sector Market Benefits and Attractiveness: How attractive is the sector in terms of size and maturity?
- Industry Attractiveness: Can you compete in this industry? What is the level of competition?
- Sustainable Advantage: If you develop a unique selling proposition, can you maintain that advantage in the future?
- Mission, Aspirations, Propensity for Risk: Are you truly passionate about the business idea itself and are you happy with the level of risk it involves?
- Ability to Execute on Critical Success Factors: Is the team you have in place going to be able to hit on all of the critical success factors well enough to ensure your success?
- Up, Down, Across Value Chain: Do you have or can you develop the connections you need to succeed?
- Each of the seven domains listed above is incredibly important to the success of your potential business venture.