I have consistently said (for longer than I care to remember) that, at least for me, there's a really simple three-question test to evaluate the viability of an idea for a new B2B business. 1) Does the proposed product or service save the end user time? 2) Does it save the customer or client money? 3) Does it increase productivity? If so, let's talk. If not, take your plan and take a hike.

Now I understand that there are ideas for businesses that are intended to address other social objectives, and that you can't measure all endeavors solely by their financial bottom line. But that's not what I'm talking about here. (And frankly, those types of businesses are not representative of the vast majority of proposals I see every day.) So, while there are clear exceptions to every rule, I'm sticking with my three simple questions until someone shows me a better approach.

Of course, the ultimate dream is to find a business that does all of the above. It's not really as hard as it sounds, especially today, when new technologies are ripping through every old-line industry and turning things upside down. I constantly see businesses that are disrupting the old ways of doing things simply by taking steps, obstacles, and costs out of the equation--and dragging old sectors into the new world.

It's not about the technology

What is so interesting to me is that most opportunities and new solutions (medical technologies being one exception) don't necessarily involve newly invented or untested technologies; they are nothing more than cases of smart people applying proven, industrial-strength technologies to eliminate waste and inefficiencies, and to improve outcomes.

This is the critical difference between invention and innovation. Innovation is smarter, faster, less expensive, and less risky than trying to invent the next big thing from whole cloth. Good technology is necessary for great products and services, but it's not sufficient, in itself, to get the job done.

The new and inexpensive technologies that are now available pretty much everywhere are certainly enablers of the digital revolution (as is the rise of mobility and constant connectivity), and these tools make the process improvements and new solutions feasible and cost-effective. But it remains true that the real drivers of disruptive change are always the same: entrepreneurs (who probably didn't know what "couldn't" be done) who look at things that everyone else has seen for years, but think of something new and different, and then go on to build something that changes the whole ball game.

Amazingly enough, once you have the critical insight that changes everyone's perspective of the problem at hand, you discover that an app or new technology that may be helpful in the process is generally not the central reason for the appeal and attractiveness of the new approach. A good example is Snapsheet, which is using mobile technologies (phones and cameras) to change the way that insurance adjusters work. Consumers simply use the Snapsheet app to take a series of photos of the damage to their car and upload it to Snapsheet, where a room full of experienced adjusters immediately evaluates the damage and determines how the loss should be handled. Losses can be settled in hours rather than days or weeks.

It's a Snap(sheet)

Snapsheet is delivering a solution to auto insurance companies across all three of my test vectors: time, money, and productivity.  

Time: Claimants get settlements in hours. They don't have to waste time sitting around for an adjuster to show up, and the adjuster doesn't waste time driving all over to look at a fender bender. In addition, using readily available data, the adjuster can instantly determine, based on the age and mileage of the damaged vehicle, whether any repair is appropriate or whether the car should just be totaled and a check for the insured written on the spot.  

Money: Insurers save boatloads by avoiding the costs of providing rental cars for their insureds. Transportation and fuel costs shrink dramatically. Faster settlements have fewer unhappy parties and significantly fewer supplementary payments.

Productivity: Adjusters can process far more claims this way. In addition, they're sitting in a room surrounded by other expert adjusters instead of being the Lone Ranger standing out in some cornfield or driveway trying to write an estimate. Faster, better, more accurate, and fully documented transactions mean happier insureds and employees as well.

But the thing that is so striking is that the major benefits from using Snapsheet don't really arise from the app or the underlying technology--any mobile device that can capture and send images could get the job done. The real value arises from smart improvements in the efficiency of the adjusting process. This is why the best businesses don't lead with technology--they lead with solution selling that addresses known (and obvious, at least in retrospect) problems.

Published on: Oct 14, 2014
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.