Entrepreneurship
Ikigai is not just a concept, it is a real tool to design an entrepreneurial strategy
In Japanese, Ikigai (生き甲斐) means "joy of living" and "reason for being". In the Okinawa province, it is seen as a reason to get up in the morning.
According to the ideograms, the term Ikigai is a contraction of two Japanese words: "Iki" which could be translated as "life" and "Gai" which could be translated as "result".
The island of Okinawa is famous for its unique concentration of centenarians in the world. The diet of its inhabitants has long been put forward as the main reason for their longevity. More recently, another reason has been regularly highlighted: the importance for them of this concept and its application in everyday life.
Originally, finding one's Ikigai is not necessarily related to work. It is more a lifestyle of well-being, joy of living, sense of family, mutual aid and community life, lifelong learning and activity, and a positive and youthful attitude. All of this is only possible if one has found their own reason for being, the real meaning of one's life: the Ikigai.
A term popularized and diagrammed by a British blogger in 2014.
Marc Winn is a British Entrepreneur and Coach.
In 2014, after a long personal work to find his purpose and after having helped dozens of Entrepreneurs to find theirs, he published the diagram representing the Ikigai, which has remained famous and is the illustration of this article.
To get to this schematization, he was inspired by the Venn Diagram, which is used to teach Sets Theory.
From a schematic point of view, the Ikigai is the central meeting point between 4 interconnected circles:
- 1. What you like to do
- 2. What the World needs
- 3. What you can get paid for
- 4. What you are good at
Finding your answer to each of these 4 topics allows you to address 4 themes that are at the heart of an entrepreneur's activity:
- 1. Its mission: it is the interconnection between what you like to do and what the World needs
- 2. Its vocation: it is the interconnection between what the World needs and what you can be paid for
- 3. Your profession: this is the interconnection between what you can be paid for and what you are good at
- 4. Passion: this is the interconnection between what you are good at and what you love to do
Finally, the interconnection between mission, vocation, profession, and passion represents the Ikigai.
Watch out for empty intersections!
Marc Winn's diagram has 4 empty intersections. These are the intersections between 3 circles excluding the fourth. They represent the non-optimal sets because each of them is missing a component:
- 1. Intersection between passion and mission: we do what we love and that brings something to the world, but that does not allow us to be paid. We can then talk about Ikigai without income. These activities can be done during free time. For me, I do volunteer work, such as with the Lions Club.
- 2. Intersection between mission and vocation: we do something we are passionate about and good at, but which has no use for the World. We can then talk about Ikigai without utility. These activities are one of the main sources of startup failures: launching the product we love, making it a best-of-breed, but without Market Fit.
- 3. Intersection between vocation and profession: we do something we like, for which we can be paid, which is useful to the World, but for which we have no aptitude. We can talk about Ikigai without competence. As far as I am concerned, it is Artistic Production. I can do a lot of things, I could be paid, but honestly, I don't have the talent...
- 4. Intersection between profession and passion: we do something that the World needs, that we are good at, that pays us, but that we don't like doing. This results in a feeling of emptiness. We can talk about heartless Ikigai. As far as I'm concerned, the politics of managerial functions in large companies fall into this category.
Reaching the central intersection, the Ikigai, allows us to reach the optimum between what we like, what is useful, what is rewarding and what we know how to do.
Ignoring one of these four dimensions puts us in an unbalanced situation:
- · In the first case, we are in a situation of idealism
- · In the second case, we are in a situation of performance without utility
- · In the third case, we are in a situation of imposture
- · In the fourth case, we are in a situation of sacrifice
The process of finding your Ikigai applies perfectly to an entrepreneurial project.
Launching an entrepreneurial project is a structuring choice that involves a certain amount of risk. Before launching, it is often advisable to ask yourself 10 questions:
- 1. Why create my company and what is my motivation?
- 2. What is my project?
- 3. What financial resources are available to me?
- 4. What human resources and skills do I need?
- 5. What is the most efficient organization to carry out my project?
- 6. Does my project meet a need and is there a market?
- 7. Do I need help and if so, what kind?
- 8. Can my project become economically viable and allow me to make a living out of it?
- 9. What are the risks?
- 10. Is my plan realistic and achievable?
Taken individually, these questions can be very difficult to answer. It requires a lot of introspection and honesty with oneself.
However, the relevance and sincerity of the answers will be a determining factor in the success or failure of an entrepreneurial project.
By defining what we like, what the world needs, what we know how to do and what we can be paid for, the Ikigai approach provides a very effective methodological framework to answer these 10 key questions. And thus, to put oneself in the best conditions for success before starting one's entrepreneurial adventure.
What we like: are we really motivated by our project, and do we plan for the long term?
I am an Entrepreneur myself, and I know how difficult the journey is and how exhausting the roller coaster of entrepreneurship can be. Having successes on Monday and failures on Tuesday is the daily grind of being an Entrepreneur and can put a strain on motivation.
Passion for our project and the pleasure to execute it are the first and absolutely crucial elements to embark on the adventure. In addition to motivation and resilience, it is also what will allow us to have the necessary resources and charisma to convince our Associates, Employees, Investors and Clients.
On this point of the Ikigai approach, we can ask ourselves the following questions:
- · Does our project correspond to what we like, to our values?
- · Does it allow us to achieve a goal that is dear to us?
- · Does it energize us?
- · Does it make us want to convince and rally to our cause?
- · Do we see ourselves in its success and in the struggle against the difficulties to get there?
If the project involves several Founders, it is important that each one performs this exercise and that the Ikigai addressed by the future Company corresponds to each one.
What the world needs: does our project provide a real response to a real need?
A good idea is only valuable if it serves someone. The objective of a Company is to sell products or services to customers, bringing them value. This product or service must meet a need, this is what we call the Product/Market Fit.
When I started my entrepreneurial adventure, I didn't give enough importance to this subject, which was nevertheless fundamental. There was an appetite for it, both among future clients and prescribers, and even among some investors. On the other hand, I didn't spend enough time identifying the real need and the real expected impact. The result: 14 months spent building useless features while omitting to build the ones that were expected in priority. And a roadmap that is 14 months behind schedule...
The right questions to ask at this point may be:
- · What problem do we want to solve?
- · Does our project provide a satisfactory and value-creating response?
- · What contribution do we want to make to the world?
- · Are we meeting one of the 17 UN Sustainable Development Goals?
- · Have we validated our answers with a representative sample of our future clients?
Before providing an answer to a supposed need, it is essential to validate this need. This step of the process can start alone, but it is essential to quickly confront the reality by questioning the target.
What we can get paid for: does our project have a viable business model?
We are talking about our business model and our remuneration scheme. To be sustainable, a company must make profit.
Once we have validated what the World needs, our Product/Market Fit, we need to make sure they are willing and able to pay for it. To generate the profit that will allow us to pay ourselves and develop the Company, our product must be monetized.
As far as I am concerned, I have a protean project, but the first step is to bring pragmatic, fast and adapted consulting services to Startups and Entrepreneurs. To validate my business model, I have discussed with many Entrepreneurs and Managers, but also with Investors. Today, my model is validated and the Investors act as prescribers.
We can ask ourselves the following questions:
- · Is our target ready to pay for the solution provided by the project? Can they do so? And if so, how much?
- · Can our project generate enough sales, profits, and cash flow to be sustainable over time?
- · Can we make a living by paying ourselves at least a minimum in the early days?
- · Can we achieve financial equilibrium without relying on hypothetical fundraising, loans, or grants, and demonstrate a capacity for self-financing to a certain extent?
This last question is in my opinion the real key to success. Aiming for self-financing, even when starting on a smaller perimeter than the final target, allows us to prove that we can create a Company with solid foundations, that is autonomous, resilient, sustainable, and adaptable to market conditions.
What we are good at: do we have the required skills to execute our project, or can we acquire them?
Now it's time to talk about execution. We have a project that drives us, that is useful to the World and that is economically viable. The next question is: are we capable of carrying it out?
As far as I am concerned, I was missing a key skill: coding. Outsourcing this part entirely would have jeopardized the economic viability of my project. My first objective was therefore to secure financially a sabbatical year, during which I trained. So, I enrolled in Harvard's CS50 and in Le Wagon Paris. I then spent several months coding, everything, and anything, with more or less success! But I finally reached the level where I can develop version 1 of my products and launch them, the time to generate enough income to be able to hire on this part.
At this point, we can ask ourselves the following questions:
- · What are the skills needed to achieve our goal?
- · Do we have them?
- · If not, can we acquire them? At what cost? How long will it take?
- · Can we bring on board additional resources that have these skills? Which model: temporary external contribution or hiring?
- · What are our gaps?
The major issue at this stage is openness and honesty with oneself. It is crucial to take a realistic look at what you can and cannot do. Many Entrepreneurs fail to execute because they have not spent enough time on this issue. Let's not be one of them!
From Ikigai to strategy.
Igor Ansoff, Professor at Vanderbilt University and Consultant in Strategy, wrote in 1965: "Strategy is the conception that the firm has of its activities, specifying its rate of progress, the fields of its expansion and its directions, the major forces to be exploited and the profit to be made".
After working on our Ikigai, we have the main components of our strategy:
- · Our activities: what we like to do and our product
- · Our fields of expansion: what the world needs and our market
- · Our core strengths: what we are good at and our core competencies
- · The profit to be made: what we can get paid for and our business model
Ikigai becomes our strategic mission.
We can now work on the last point of our strategy: the Rate of Progression, our Roadmap.
Our roadmap allows us to plan the actions and milestones necessary to reach our goal. It also allows us to break down our objective into intermediate sub-objectives, which are easier to achieve.
During our Ikigai process, we may have identified that our Product was ambitious and needed to be broken down into more manageable deliverables, or that we needed to acquire key competencies to reach our goal, etc.
How do we build the path to our goal?
On this point, Ikigai can also provide some answers. For example, I know how to do Consulting and Interim Management for large organizations, and I can be paid for it. This is not the Ikigai of my entrepreneurial project, but it is a step allowing me to finance an ambitious project that will take time to build.
In conclusion, using the diagram popularized by Marc Winn proves to be a real tool for structuring one's thinking and approach to defining one's entrepreneurial strategy. It allows you to ask yourself the right questions, the answers to which will allow you to formalize your Pitch Deck, your Business Plan, and your Strategy.
So. What about you? What is your Ikigai?
