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|Submissions to Eli's 3rd Riddle (with comments from Eli)|
Congratulations to Samuel Okoro, winner of the 3rd Riddle! Below you will find Samuel's answer along with comments from Eli, and you will also be able to read Eli's answer to the riddle, which has comments on different submissions from other participants.
Additionally Eli has created a separate document which uses the Six Questions by Dr. Eli Goldratt to answer the 3rd riddle. The document can be found by clicking on the following link: Six Questions that Answer the 3rd Riddle
Thank you for everyone who participated in the riddle. Stay tuned for the 4th riddle coming soon!
Who Needs Another Word Processor?
ORIGINAL RIDDLE: Chris is the energetic managing director of RiskyBusiness, a successful risk fund for innovative start-ups. Chris claims managing risky investments is actually a pretty good stable business. Of course, such a risk fund needs a manager that is able to predict the potential value of an idea. RiskyBusiness has done very well in the last seven years, about 20% of its investments are considered truly "successful” and about half of those investments have multiplied the initial investment by at least a factor of 10. Some did much more than that.
Here and there Chris is facing a dilemma whether to invest in a new idea or not. Here is his description of such a case.
"I saw enough crazy people in my life. Actually we made a lot of money on some crazy ideas invented by very crazy people. However, most crazy people come up with very stupid ideas. Usually I can see the difference. Here I have a case where I am not sure. This guy Dan Silver, holding a Ph.D in Mathematics, is looking to fund further development of his software as well as to enable the marketing of his word processor that he believes would outclass Microsoft Word.
What Dan has already developed is a full word processor that has several claims to be superior to Word. Here is a short list of the special features of SmartWriter:
I’m hooked by this nice and efficient program to the point that I use it all the time. This "crazy Dan” believes that several additional features should be developed within SmartWriter. I especially like the ability to improve the quality of the text I’m writing. I find it quite fascinating. Well, writing is not one of my strengths.
However, I’m troubled by the business case. Is there any chance in hell to sell enough SmartWriters to truly replace Microsoft Word???
Samuel Okoro's Answer (winner): I believe Chris is trying to address the "wrong” question when he asks if there is "any chance in hell to sell enough SmartWriters to truly replace Microsoft Word???”
Like any other investor, Chris’ concern is to ensure sufficient returns on investment while minimizing the risk. For the current business case, the Chris is conflicted between, on the one hand, going ahead and investing in SmartWriter and on the other, avoiding the risk altogether, by not investing in SmartWriter.
The conflict cloud entities are :
Goal - A: Manage RiskyBusiness’ funds well
Necessary condition - B: Seize opportunities for good return on capital
Necessary condition - C: Protect funds against risk of loss
Action required to meet need B is D: Invest in SmartWriter
Action required to meet need C is D’: Do not invest in SmartWriter
Arrow C-D of the dilemma can be stated as ‘if we invest in SmartWriter we cannot protect the invested funds against risk of loss’. The key assumption driving this belief is the contained in Chris’ question. He seems to believe that (i) unless the product outsells MS Word, it is not successful and (ii) he doubts that this can be done.
These reservations mainly relate to chances of creating a market of adequate size for SmartWriter (rather than per se outselling MS Word). Exploring the question of the potential market (and thus future value) of SmartWriter can be done by using Goldratt’s six questions as a guide.
TOC’s Six Necessary & Sufficient Questions relating to Technology (N&S)
i. What is the power of SmartWriter?
Chris already outlined the capabilities of the new application along several dimensions including flexibility (multilingual capability, lexical automation, navigational easy, multi-document support, historical recall) and storage
ii. What is the limitation it addresses?
SmartWriter removes limitations in the areas relating to its various capabilities
iii. What were the rules created to cope with the previous limitation that must be changed?
a. Using just the area of multi-lingual support and automatic translation as an example, coping with this limitation would require the use of human translators (current automatic translation available provide severely mangled versions of documents)
b. This means confidentiality must often be sacrificed (in business and diplomatic circles – just to mention two)
iv. What are the new rules needed to exploit the power of the technology?
These will need to be explored for each application of SmartWriter
v. What are the resulting required changes in technology itself?
a. It seems immediately obvious that the many capabilities of SmartWriter can be unbundled and repackaged for different markets. For example, organisations like the United Nations, international scientific journals and multinational corporations will find the multi-lingual support and automatic translation to be its most useful features. Professional writers and schools may find its grammar-correcting capabilities to be the most useful. Publishing houses will find all features (language, grammar and storage requirements to be of value.
vi. How can the technology provider, integrator and user work together to enable the implementation of the required changes on win/win basis?
a. While it is possible to bring SmartWriter to market as an alternative word processor to MS Word (which seems to be the current thinking of Chris) this would bring them head to head with the considerable resources of Microsoft. This can be a difficult route as various open source offerings (some of which are arguably superior to Microsoft’s offerings) can attest
b. Other possible routes to market might be to provide SmartWriter (or its capabilities) as add-ins to MS Word, email products, emerging hosted word processing applications (like Google’s online document processing products), add-in to search engines, integrate with text-to-speech applications (you can have a French document automatically rad to you in English)…
c. Exploring these options make the question of outselling MS Word completely irrelevant and greatly explode the potential value of SmartWriter.
Eli's Comments on Winning Answer: The answer provided by Samuel Okoro is pretty extensive. Like those by Birrell and Conway it is based on the six questions by Goldratt and eventually touches upon all the points I find important. Just to illustrate how Samuel points to the various market segments that can draw value: "It seems immediately obvious that the many capabilities of SmartWriter can be unbundled and repackaged for different markets. For example, organizations like the United Nations, international scientific journals and multinational corporations will find the multi-lingual support and automatic translation to be its most useful features. Professional writers and schools may find its grammar-correcting capabilities to be the most useful. Publishing houses will find all features (language, grammar and storage requirements to be of value.”
I think Samuel Okoro is the winner for this riddle. I definitely recommend the reader to read his whole answer. I also think that to read all the answers would give you the idea of the spread of thinking around one specific case and already point out how the six questions might do well to focus us on a good route. As said I’m also providing my own analysis around the six questions.
Eli's Answer to his Riddle and responses to other answers: This riddle calls for analysis using Goldratt’s six questions on the potential value of new technology. However, this knowledge was not formally required and most answers did not use them. Thus, my main answer does not use the six questions. But, in order to draw the most value of the riddle and the new knowledge embedded in the six questions I’m publishing a separate short article with my own analysis fully based on the six questions.
Replacing MS Word looks like the goal of an ego maniac. As we all know some ego maniacs have visions that sometimes come true. The duty of Chris is to guide the efforts of "crazy” people with a viable vision into the route that leads to a very good business through generating value to potential customers.
The majority of the answers to the riddle claim that there is no chance to replace MS Word. I fully agree. Some of the answers explain why it is so difficult. Here is how Charlene Budd expresses it: "Because Microsoft has cleverly integrated all of its software and bundled most of it, I doubt that any word processor, no matter how superior it might be, will replace MS Word.”
I’d further add that MS Word is also a standard – meaning I can send a Word document to anybody else and expect they would be able to read it.
My main disappointment with many answers is that once this claim has been stated the verdict was clear: Chris you should shy away from this project. I think this is a BIG mistake. The potential is too high to give up at such preliminary stage of the analysis.
One important assumption that challenges such a quick verdict:
If a product yields real value then there is a way to convince the potential clients of the value and eventually base a business on that product
I’m aware that selling content through the Internet is tricky and challenges the above assumption, but I believe a way can be found. Most certainly we should actively look for a way to sell what seems to be like real value-added to the end user.
Fortunately, many of the answers did not stop at the assertion that MS Word is not going to be replaced and looked for a way to use the unique value of what Crazy Dan has invented. Alejandro Cespedes writes it very clearly: "The question is not if SmartWriters can replace Microsoft Word. The real question is whether SmartWriters can be a successful business venture or not.”
Most answers, though, defined the product as aiming to a certain niche in the market. Charlene has defined it this way: "Professional writers and editors, poor English writers, and writers corresponding internationally might be interested in the SmartWriter product, but I believe those willing to purchase and learn SmartWriter would constitute a niche market.”
There were several answers in the spirit of Charlene Budd: The new word processor can be used for a niche market. I assume that the meaning of a "niche market” is a small market segment. I’ll address this issue of the size of the potential market later.
Matias Birrel and Paul Conway based their answers on the six questions, noting the current behavior (spending time to correct the text etc) and even mention some negatives (minor to my mind – but still part of the analysis). Both directly checked the added value of SmartWriter.
Is it a good idea to have a full blown word processor to offer the unique added-value?
Hadas Schragenheim, my own daughter, took an additional step: "If this features were an add-on on Word, it might had a chance. In addition, if he insists of having it as a different software, a necessary condition he missed was compatibility to Word (opening Word in his software and vice verse) and to Mac processor”.
I like to state clearly that I did NOT discuss the riddle, or any hint to it, with my daughter. What I think is significant in what Hadas wrote is not just to raise the possibility of having an "add-on” software as the product to have but recognizing that in order to materialize the added-value some additional features should be developed. So, Chris has to send Crazy Dan back to the development stage and focus on what is truly critical, and go over the stupid notion of replacing MS Word and avoiding Spanish.
Hadas was not the only one to note that there is another way to generate the value. Once we accept this the critical point we have to evaluate is the possible size of the market for the feature that truly gives value: the high quality translation and the ability to improve the use of the language to come up with effective sentences. I believe that all the rest of the features are mere "choopchics”.
Is the market small?
Being one of those who long for such a tool to increase the standard of my own writing in English I see a huge need all over the world for such service. Is the value significant only to "poor English writers”? In the world of literature it is known that even the greatest writes need truly good editors to improve their writing. All right, I don’t think any sophisticated software can replace the human editor for a book of literature. But, it might save a lot of time for most other people that mind how their own writing is received and understood. Whenever you write in a discussion list, do you sometimes go over your text just to check it truly expresses what you wish to say? Did it happen to you that what you wrote was not fully understood or properly appreciated? It is not just grammar – badly written sentences might be revealed if the mysteries of the effective structure of sentences are discovered and the proper algorithm be developed. I believe that many Word users who were raised in non-English speaking countries and sometimes need to read or write a document in English will appreciate the value. Remember, huge efforts were done so far to develop computerized algorithms capable of adequate translation. Those that are already in use are not more than adequate, so the need is certainly there. Once the translation is very good – the usage could be overwhelming. My estimation is that we speak about a "niche” of many millions of people (50 million? 100 million? More?), who are already aware that such a tool would be a blessing, and many more who currently do not think they need it, because there is not standard reference of what is "good writing”. Take a small country like China and imagine the problems they have in their international communications. Take any international organization that is aware that some of its standard documents are not properly understood in other countries. Take even any newspaper where the reporters need to write something very quickly and quick editing is still a problem. I do claim that the value of truly good translation and being able to produce effective and grammatically correct English is simply HUGE! Yes, marketing has a lot to do and we did not even start to truly apply the six questions, but the need is all there.
And, what about the value of being able to translate from other languages to our own? Electronic would make it possible to quickly translate any book to other language is a "fair manner” that still keeps a lot of the original value. Does this add value to readers?
Yes, my advice to Chris is to go ahead with that project – PROVIDED crazy Dan would agree to follow the direction: develop a translation and good-language convertor that would be able to easily and conveniently import and export from Word and various internet formats. Crazy Dan would have to forget all the other features that do not add much value and depart from the wish to come up with a full blown word processor, because offering the users a new word-processor is an obstacle to the huge value of having a focused agile product designed to bring significant value very quickly.
Maybe the ironic size of the relationships between the "inventor” and the "investor” is that the latter has to have a different sort of innovation capabilities – focused on coming up with the right direction for the great idea of the inventor.Several answers raised very interesting ideas on how to achieve success. Christophe Lambert was looking for the mobile phone market where Microsoft has little impact. David Petersen offered to license the technology to Microsoft itself, as it could draw a lot of value fairly soon. I do not necessarily agree to those ideas, but they deserve good analysis and are innovative in the way I expect Chris to be.
I wish I had SmartWriter, or at least "SmartEditorandTranslator” to polish this rather long document of mine.
Below are the submissions from all participants, with the exception of the winning answer. For your convenience, they are listed in alphabetical order by last name.
Anant Agarwal: There is almost no chance to sell enough SmartWriters to truly replace MS Word. First of all, all the features of SmartWriters are easily copiable by a company like Microsoft. Anytime Microsoft sees a threat from this new software, they can spend enough money to counter the threat by including new features and reducing the price. Secondly, even if Microsoft does not take any action, a lot of investment will have to be made till this new software will attain a critical mass (number of copies sold) when enough people use it so that different people can use the same file.
Manoj Agarwal: There is a very good chance to sell enough SmartWriters to truly replace Microsoft Word. The real constraint in writing documents is no longer the editing facilities. It has moved to the ability of people to write better quality text. SmartWriter solves this real problem. Of course - the entire positioning, marketing, sales, support etc. would have to be aligned (subordinated) - may not be easy - so evaluation is in order.
Orlando Aguilar: Are we talking about new Technology? This is not the case. Is SmartWriter a new product? Definitely no. Is SmartWriter a better product/service? Maybe. When is it consider a better product/service? But, before I answer this question, it is necessary to state that a product/service is not itself (its own features); we have to consider not only the solution that handles, but the whole offer, which means the way we deliver; when we deliver; the way we support it, etc. Taking account this, the perception value of the market can be increase. So the next question is: Is SmartWriter increasing the perception value of the market? I don't think so. Does SmartWriter hand more real benefits that increase the perception value of the market? I don't think so. And finally: What root cause of the market is SmartWriter solving? None. So, for me, there is not a chance that SmartWriter truly replace Microsoft Word.
Matias Birrell: "A new technology brings benefits if and only if elevates a limitation". Let's apply the N&S questions to this technology:
1. The power of this technology (different to MS-Word): - Handling lots of concurrent documents. - Translation and improving writing style.Setbacks: - Style would be very much alike among the users (after all, it is the software correcting the text); which could be ok for several applications (not literature).
2. What current limitation it elevates? - With the first I see it facilitates bad multitasking: it creates a limitation! - The second facilitates people with poor writing skills to write faster and better.
3. Current mode of operation - Writing and correcting again and again, using time to improve the text.
4. New mode of operation - Writing in one shot and allowing SmartWriter to correct.
5. How to market it - Showing how a bad writer can improve significantly with this tool. 6. What modifications should be done - Instead of a full processor it could be an add-on MS-Word and other processors.
Conclusion: as a replacement for MS-Word, I see no future.
Eduardo Bonfim (Junior): In 1998 a crazy "Larry" came up with a crazy idea. Provide a search engine in a time where reigned the mighty Yahoo. Obviously people had probably called them (Larry and Sergey (another crazy guy)) idiots because nobody would never ever need nothing further than Yahoo and Altavista. 14 years later, the crazy "Larry" turns up to be the most powerful internet player figuring among the top 3 most valuable brands on earth, such as (Apple, Microsoft, Crazy Larry's Google). Once Chris business faces a 80% failure rate and yet, still being a good and stable business, he definitely must consider the project, yet, because of two more key points: The crazy "Dan" from Eli's riddle is an academic as well as the crazies (Larry and Sergey) and the breakthrough is based on a new algorithm that saves memory and storage capacity. Two giants constraints in Cloud computing world.
Charlene Budd: Professional writers and editors, poor English writers, and writers corresponding internationally might be interested in the SmartWriter product, but I believe those willing to purchase and learn SmartWriter would constitute a niche market. I believe few MS Word users fully utilize very many of the numerous currently available features of MS Word and it would be extremely difficult to sell many Word users on buying and learning an entirely new word processing software. Because Microsoft has cleverly integrated all of its software and bundled most of it, I doubt that any word processor, no matter how superior it might be, will replace MS Word. (Personally, I thought that Word Perfect was far superior to the earliest versions of MS Word.) For example, a Word document can import a table from an Excel spreadsheet that automatically will be updated each time changes are made in the spreadsheet. Word also can hyperlink to MS Project to show project updates. In addition, all MS software can be hyper-linked into MS PowerPoint. Of course, SmartWriter might be able to emulate these linking features. In any event, the software has been developed and other than marketing costs, it might be profitable to promote the current version to targeted markets. Provided sufficient customers acquire the software, later versions could add additional features.
Andy Cameron: While the translation, multi document, memory saving and document maneuvering features are nice to have most people only write short documents in a single language. The word processor does not address the biggest shortcoming of word processing which is the qwerty keyboard, an anachronistic design intended to SLOW down word processing (because the mechanical linkages in old typewriters couldn't match the finger speed of the early typists.) No he will not sell enough.
Henry Camp: No. WordPerfect was already better than Word when Word surpassed it.
Alejandro Cespedes: The question is not if SmartWriters can replace Microsoft Word. The real question is whether SmartWriters can be a successful business venture or not. Chris mentions that SmartWriters has very nice features, but this isn't enough to conclude it will be a hit. Instead of focusing on adding nice features to the software, Dan should define a market segment and see what needs are not met by Microsoft Word. If his word processor solves a market segment significant need, SmartWriter could be a hit, even if it doesn't replace Microsoft Word. A perfect example is Linux. This operating system hasn't (and probably will never) replace Windows, but it's the preferred OS among programmers because of its open code.
In conclusion, Chris's real interest is not replacing Word. His real interest should be to make a nice return on his investment in SmartWriters, and based on the information, we can't say. Dan should target a specific segment or niche and focus on solving real problems that Word doesn't solve. Then it will be clearer if Dan's got an innovative start-up. Maybe the feature that translates with perfect grammar can be very important to people who need to write but have bad grammar (bloggers, consultants, small business owners that can't afford assistants or secretaries, etc.). Maybe this could be a nice segment to target.
Clarke Ching: We are asking the wrong question at the end. Rather than asking if we should replace Microsoft Word we should ask if enough people will purchase the product to make the investment worth while.
Given that Chris uses the software, likes it, and genuinely thinks it improves the quality of his writing (something which MS Word never claims to do and which would be a genuine competitive distinction) then there may be a market for the product. That's only 1 data point but I suspect there are a lot of people out there like Chris who'd like help to write better and would be willing to pay for it.
Another data point is that I recently purchased specialist word processing software called Scrivener. It's a product written especially for Novelists and professional writers. I now use it rather than word (which I've been using since 1989) whenever I can. I also bought a Mac - and went through the painful transition to the new operating system - just so that I could use Scrivener. So, effectively, I paid about 10x the cost of MS Word so that I could write my book more easily.
So: if Chris decides to pitch SmartWriter as a tool which improves people's writing - and maybe even finds a way of integrating that feature into MS Word - then I think he stands a strong chance of creating a new market in which SmartWriter would be the only player.
In TOC terms I think it's fair to say that SmartWriter tackles a limitation (writing skill) which Word doesn't. For some people that limitation is very ... limiting; for others it's not. Put me down for a copy please, Eli.
Paul Conway: Can Smartwriter replace Microsoft Word?
Eli Goldratt developed a framework for evaluating such a question. That framework comprises six questions.
Q1: What is the power of the new technology?
Smartwriter is an excellent aid to the grammatically challenged individual, novelist, blogger or business person seeking to better communicate in an increasingly global world economy. Smartwriter does the grammatical thinking for the user.
Doing the thinking for your customer is a very powerful value proposition - it is the essence of a brand’s value.
Q2: What current limitation or barrier does the new technology eliminate or vastly reduce?
The primary need met by Smartwriter is correction of poor grammar and translation between languages. In an increasingly connected world the potential market for a product that improves the ability for people to connect is large and every increasing.
Q3: What policies, norms and behavior patterns are used today to bypass the limitation?
How do people currently deal with their weak grammar and or translation needs.
Word automatically corrects grammar. It comes bundled in Windows software. There is no need to load new software, learn new software or be concerned about incompatibilities or (more) system crashes. For these reasons Word is a simple and therefore compelling option for users.
However, Smartwriter has many more features and takes grammar correction to another level. The concern about one’s grammar puts many people off writing. Smartwriter may help many people overcome this fear.
In respect to translation needs, there are already professional translators and applications such as Google. Are these alternatives good enough? Using translators is expensive and time consuming while current translation applications are rather clunky and clumsy. Smartwriter appears vastly superior.
Q4 What policies, norms and behavior patterns should be used once the new technology is in place?
This question addresses what needs to occur for users to get the full benefit of the new technology – or what the new technology needs to provide for users to get the full benefit of its value proposition.
The promise of the new technology is that it will do the grammatical and translation thinking for the user. The get maximum benefit the software should therefore be available wherever and whenever the need for translation arises. It should, in time, be available for PCs, Apple type devices and for the spoken word, for example via ‘Smartalk’ phone and voice recorder translation software.
Obstacles and negative branches to implementing the Smartwriter software in its present form include:
• Users fear that if they move to Smartwritter they can’t move back to Word if they don’t like it, or that they can’t use both Smartwriter and Word if they choose.
• Users unable to switch to Smartwriter because of company policy preventing the use of or loading new software.
• Some applications used in conjunction with Word may not be compatible with Smartwriter.
• Cultural difference not accommodated by the software
• Personality of the writer not able to be expressed by Smartwriter
• Users may be wary of new software upsetting existing documents or settings in their computer.
• Cost of the software.
• A potential negative branch maybe where users rely on Smartwriter when for legal or commercial reasons it maybe imperative that specific words and grammar be used.
• Another negative branch is in-compatibility with existing documents, embedded links or user systems.
Q5 In view of the above, what changes/additions to the new technology should be introduced?
In its present form (i.e., for the written word)
• Make it easy for customers to use switch to Smartwriter and back to Word if they want
• Ensure conflicts with other software are eliminated.
• Make it easy for users to learn how to use it.
• Make it easy for users to have problems resolved.
• Ensure that users understand that legal documents may require relevant expert review.
• Ensure that at some point in time Spanish is included – it is a very widely used language.
In its proposed form (i.e., for the spoken word)
• Make the technology able to translate the spoken word in real time.
Q6 How to cause the change?
Chris asks can Smartwriter replace Word. This is a big ask! If the aim is to truly replace Word then the benefits of adoption and the transaction costs need to be very very low. This includes ensuring that all obstacles and negative branches are effectively dealt and the software is easily available.
The software would also have to be relatively cheap. It could perhaps be made available as an inexpensive downloadable application, perhaps even for free with embedded advertising banners generating revenue with more feature laden upgrade options available. Development costs are largely sunk. Assuming low direct variable costs and small additional Operating Expense on release, throughput will be high in proportion of sales and with low OE most of the revenue will end up in the bank (all financial assumptions should be modeled)
Another option may be to make the translation ‘engine’ in the software non-proprietal in a limited form so that it becomes a universal translation and grammar correction standard. This may help to get the product widely used, with revenue generated from advertising on the free ware and sales of more feature laden products.
So, can Smartwriter replace Word? Perhaps not for those people with good grammar and no need for translation services. However, there are many people who have these needs and if Smartwriter can overcome their obstacles and negative branches, including availability and affordability, it could be just what they need.
Nelly Flebus: Three obstacles for reaching the goal (replace Microsoft Word) - exclude large number of Spanish speaking users - mainly focusing one Word as an text processor - Users of Microsoft word very often are using that program as part of the Microsoft offer - what about compatibility with programs such as word - at least in the start up period it will be very important that the texts will be accessible for Microsoft users and that text from Microsoft can easily be worked with in the new program. We should first try to find the right injections to overcome the obstacles - but taking into account Dan reaction on including Spanish and the importance that is given to funny features such as using 100 different documents at once I think that Dan is not prepared to change his idea and he certainly did not make a sound plan based on TOC - thinking tools. Unless he is prepared to do so I would say no to this project Other more complete programs(some for free ) did not succeed.
Bo Gulledge: The issue to focus on is not replacing MS Word. Its ubiquity has been established over many years. The issue to focus on is market segmentation. This software appears to have significant factors that would appeal to several market niches, iinternational business or the mobil devices market for example. If SmartWriter gains a foothold in several niche markets it could later expand to other areas. Replacing MS Word would be answered by the market much later in this product's life cycle. For now, focus should be on niche markets wheret its strengths can compete best.
Christophe Lambert: Find a way to make a load of money on the product without replacing Microsoft Word. Microsoft Word’s competitive edge is sustained through being an industry standard for document exchange on personal computers (PCs), including tight integration with the Microsoft Windows Operating system, and the Microsoft Office suite of products that are also worldwide standards. Two options come to mind to make significant revenues from SmartWriter. First, Microsoft does not have document exchange, operating system, or office suite dominance on smart phones or tablet computers. Such devices are already outselling PCs and the total global mobile internet device install base is projected to surpass PCs by 2015. Further, regular cell phones already outnumber PCs by at least 4 to 1, though data entry on such devices poses an obstacle to word processing. The low memory footprint of SmartWriter, makes it well-suited for mobile devices. Combining SmartWriter’s translation with existing speech recognition software could improve text quality, data entry, and cross-language communication for all mobile devices. Everybody’s spoken speech falls short of polished written word and SmartWriter could fix that for emails, text messages and other communications. Port the program to the leading Google (Android) and/or Apple (iOS) operating systems to achieve dominance first as a straight word processor for mobile devices, and in subsequent versions elevate the product to a speech-recognition enabled one. Google already has speech recognition technology – consider partnering with them to have SmartWriter embedded and distributed with the Android operating system. The second option, which is not incompatible with the first, is to license the SmartWriter translator technology to Microsoft to embed it in their Word application to make money off the PC market as well.
Larry Leach: While attaining a niche set of users may be possible it is unlikely to replace Microsoft Word. Market domination is rarely overcome by technical features. The qwerty keyboard and VHS Video format are the two standard examples. The translation niche may be enough for a viable product but it won't compete with MS Word. There is already a free version of open-source software the performs as well as MS Word but hasn't dented their sales. Worse, the technical features relative to memory and computing are not relevant to most users and would be overcome by Moore's law even if they were. A unique business offer is needed.
Grant Lindsay: Why does it have to replace Microsoft Word? Perhaps there is enough of a niche market to still do quite well. Also, if SmartWriter were able to import MS Word documents then it could function as a stand alone or as an add on. Neglecting Spanish seems to be a poor choice.
Alex Meshar: No.
Ramakrishna Munagada: Chris’s dilemma is genuine. He is concerned about two aspects: First – marketing of SmartWhite, and second – technical features of Smartwriter vis-à-vis Microsoft Word. He knows that technical features alone are not sufficient to market any product. To market Smartwriter, he needs to cause ‘change in rules, rules that cast into behavior, into culture’. How to cause this change is his biggest concern, when WORD has already become a way of life for many users. His user segment is divided into users and potential users. Potential users are teenagers, school children, publishing houses, and corporate houses. Teenagers and school children are not yet habituated incorrigibly, or some of them may be in a learning phase, therefore, it is easy for them to adapt to Smartwriter. Publishing houses are constantly looking for better software, with features such as concurrently using by many users, low memory space etc, hence a potential customer. Corporate houses are also seeking cheaper, scalable, compatible and consistent solutions. The next set of users is individuals; given a better solution rules of behavior can be changed, but not impossible. The best example is Google, which is relentlessly changing rules, moreover software companies are always changing the rules in the name of version changes.
The next part of Chris’ dilemma is about technical features. Dan seems to have passion, and necessary competence to create a better version of word processor. Chris himself got hooked to the sample version of Smartwriter. Hence, this project can be funded.
David Peterson: Poor grammar is a significant problem for many people, but not everyone. Attempting to replace Microsoft Word - the worldwide standard - is a fool's errand. It would be better to sell a grammar-correcting plugin for Microsoft Word or, even better, license the technology to Microsoft, so it can be built into the next version of Word.
Michael Round: To paraphrase The Wizard in The Wizard of Oz, Chris "is the victim of disorganized thinking”. He believes in order to be successful, the program must over-take Microsoft. This non-realistic assumption would immediately shut down any potential investment. Chris is looking at an opportunity he himself has evidence the creation has possibilities! Why? He’s a writer, and he likes how the program improves his writing. Already, he’s created a niche for the program, a target market. His firm’s poor track record of investments that really take off (1/2 of 20%) means likely nine out of ten investments don’t take off. This single example may point in a direction why.
Felix Sanjuan: As a Spanish user of MS Word would not consider SmartWriter as a replacement. If we assume that SmartWriter would provide backwards compatibility with MS Word I would consider it as potential translating device. I would have to mistrust the capabilities of the "language translating" engine because of the refusal to incorporating the second most spoken language in the modern world. It would probably have to be marketed as an aid to better-English and maybe given free "cloud" use to have any real chance to worry MS.
Hadas Schragenheim: There is no way this software will replace Word. I think the main reason here is that it does not solve any issue to the user, it is a small "nice to have" and not nearly enough in order to replace the user's Word. If this features were an add-on on Word, it might had a chance. In addition, if he insists of having it as a different software, a necessary condition he missed was compatibility to Word (opening Word in his software and vice verse) and to Mac processor.
Piet van Haute: One can debate whether the capability of ‘replacing MS Word’ is a necessary condition for a profitable investment. I can imagine for instance that generating ‘enough’ sales-volume to be on MS’s radar could trigger an acquisition-interest (from MS e.g.), or that proven-working innovative features could be sold (to MS e.g.), or that an entirely different business model could position SmartWriter beyond competition to MW Word (e.g. free software for user but paid for through publicity), or … Any of these could make the investment financially worthwhile.
The true question is probably twofold:
- will there be enough ROI?
- Can SmartWriter grow faster than the market?
The first one is important if you want to generate the return on your investment from the core business (=producing and selling software). As a ‘risk fund’, Chris is not interested in this type of operational return, he wants to sell the actualized future (potential) profits of the company (like any shareholder of a publicly traded company), which means that SmartWriter needs to outperform the market (of text-editor software).
Assuming that every computer(owner) has already a text-editor installed, this basically means that SmartWriter needs to ‘convert’ users of a competitor-text-editing-software. The extend and easiness with which SmartWriter can do this, will determine the success of the investment.
Making users change (from one software to the other) requires a positive balance of the following elements:
1. Does one have any pains with the currently used editor (Crocodile), and would this, in minimum, not aggravate when changing?
2. Does one have any benefits from the current software that he doesn’t want to let go of? (Mermaid)
3. Are there any disadvantages to the new software? (sticks)
4. What benefits would one get with the new software? (gold)
Assuming that SmartWriter contains the same functionality as most/all other editors, assuming a similar sales price, and given that the die-hard fans of a specific software are a neglectable minority, considerations 1 and 3 are of lesser importance.
The comparison that is determinant in this investment-dilemma is: how superior is the ‘gold’ (auto-translation with consequential productivity gains and cost-reduction) compared to the ‘mermaid’ (the effort a user has to make to get used to the look&feel of the new software). Especially the last element is not to underestimate. When was the last time you were frantically trying to change the spacing between lines (where you know exactly how it is done on your company-computer) for 15 very dear minutes … to leave it blank in the end? How much is this feeling worth to you?