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Over the course of the past eleven chapters, the construct of the Four-Way Fit model has emerged brick by brick. Part 1 described its framework. Part 2 described its method. By this point, it’s my expectation you possess a solid understanding of the central concepts that make up this new innovation model. Here in Part 3, we will explore how the Four-Way Fit model is uniquely expressed at each stage of the journey of company-building.

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If drawing up the game plan on the side of the field is the “heads up” motion, the “heads down” motion is the game itself. In Phase II, the game becomes three-dimensional chess. To grow requires a mix of big systemic change, incremental continuous improvement and test execution. These occur at the intersection of people, workflows, technology and money flows.

Now your enterprise has rising heft and momentum. Its purpose cascades down into operating system purposes, which cascades down into domain purposes. If the enterprise is organized based on the principles of domain-driven design, then each domain within each operating…

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As you exit Phase I and enter Phase II, consequential change awaits. To get out ahead of that change, you must step back and take stock. That’s the “heads up” motion.

How different the world now looks! With value breakthrough in hand, customers gather at your doorstep. As the customer count rises, investors invest. New resources follow, prompting a division of labor. Once a single-cell organism, your company now divides and subdivides into an ever more complex system. The product itself rises in complexity, as new features address more use case scenarios and segments. Technical infrastructure begins to matter; now…

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The “heads down” motion in Phase I is action-packed. It’s where the rubber hits the road. Now that you have sorted out your reason for being, you shift to the doing. You face many unknowns; you can claim few settled assumptions. And so you must test, test and test again — in a constant (and desperate) search for truth. Testing takes more time than just winging it. But it saves time in the long run. It is better to crawl, then walk, then run than it is to run and crawl back.

Said another way, your job is to fail…

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If you are a startup CEO in search of a value breakthrough, you know the challenge: find one before the money runs out. It’s a Catch 22. To achieve a true breakthrough requires you to understand gaping problems and screaming needs at a deeper level than any other actor in the space. And your solution to these problems and needs must radically improve upon anything that currently exists. How is that possible with so few resources?

The only way to accomplish this feat is to learn more than all others about your chosen market and top priority segment, as cheaply…

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The Four-Way Fit model is composed of a framework and a method. For the past five chapters we have explored the framework, as it is expressed in its canvas and spreadsheet forms. The framework is static: a strategic snapshot. When complete, it presents an integrated set of claims in the domains of Market, Product, Model and Team that, if proved true, will lead you to your next value inflection point.

Now it’s time to turn to the Four-Way Fit method. The method is the dynamic process by which you grow your company. It is here that you complete the…

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The Team domain is the final domain in the Four-Way Fit for a reason. Your value breakthrough will be achieved by your team. Your team will optimize that value. Your team will build sustainable competitive advantage. It takes people to design an intelligent, efficient scaling path. The more capable your people are to address the task at hand, the better your outcomes will be.

If you are the CEO, as you move from phase to phase it’s on you to bring together a team stocked with all requisite competencies, arranged into right roles, placed within a serviceable organization structure…

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The Four-Way Fit framework places unique importance on the third domain: Model. To build an iconic enterprise, it’s not enough to achieve a value breakthrough. You must also discover a business model breakthrough, one that enables you to profitably scale while keeping cash flows manageable and building sustainable competitive advantage.

The Model domain is made up of five subdomains:

  • Pricing claims
  • Unit economics claims
  • Customer acquisition method claims
  • Cash flow claims
  • Competitive moat claims

These five subdomains interact with each other in important ways. Pricing shapes unit economics. Unit economics shape your customer acquisition method. Pricing and unit economics…

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— — — — —

Have you reached a value breakthrough? Until you do, your existence is threatened. Once you have discovered that breakthrough, the world opens up. You earn the right to embark on the scaling path. Yet even then, the work has only just begun. Now you must extend and optimize that value. Now you must find a path to sustainable competitive advantage.

This is the innovation journey. It’s hard. Markets and customers evolve; competitors rise. Value has a half life. To keep ahead, you are challenged to build rising customer-defined value — day by day, brick by…

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The first of the four domains in the Four-Way Fit is Market. If you are to become an iconic global enterprise, you must achieve a value breakthrough, expand upon that breakthrough by optimizing it, and then make it sustainable — in a large and ready market. But how do you confirm that the market is large and ready? How do you confirm that there are customer segments within this market that have gaping problems and screaming needs, ones you can address with a valued product and viable business model? You do so by confirming your assumptions in three subdomains:

Tom Mohr

Founder and CEO, CEO Quest

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