Validate the customer problem
Interview users, budget owners and procurement decision-makers separately to establish actual requirements and acceptance conditions for continuity, cost, compliance or carbon information.
PRACTICE / STRATEGY
New businesses and business-model design.
Start with needs customers will pay to address, then design growth that can be delivered and repeated.
Methodology: The ZHICE Scenario-led Strategy MethodTHE REAL CHALLENGE
Define the problem first.
Existing assets and technical capabilities can provide a starting point for new energy businesses, but they do not automatically create a sustainable business model. Whether customers pay for reliable supply, cost improvement, low-carbon requirements or operating services determines the product boundary, contract and delivery system. ZHICE examines four interdependent elements: customer needs, the value proposition, delivery arrangements and the revenue mechanism. Targeted market validation reduces uncertainty. Early work establishes evidence; expansion then tests unit economics and the conditions for replication.
BEYOND THE SYMPTOMSLook beyond symptoms.
Look beyond symptoms.
Understand the business logic.
New-business design begins by distinguishing the existence of a need from a viable business model. A customer considering a problem important does not establish budget availability, willingness to buy or ability to cooperate in delivery. ZHICE identifies users, decision-makers and payers separately, checking the outcomes sought, current alternatives and conditions for adopting a new service. We then establish how value will be measured, attributed and settled so that commitments match delivery boundaries. Technology, assets and channels must demonstrate their usefulness in specific customer tasks.
Validation focuses on assumptions most critical to commercial viability, rather than demonstrating the greatest number of functions. ZHICE first defines the evidence needed to justify further investment, then selects interviews, trials, joint validation or limited delivery. Validation records adoption, delivery demands and actual costs, distinguishing elements that can be standardised from those dependent on special conditions. Before expansion, reassess unit economics, key-person workload and partner dependencies to establish a conditional replication path and stop criteria.
A TOOL FOR THE WORKING SESSION
Turn diagnosis into verifiable questions.
Four tests of business-model viability
Swipe to explore the complete table
| Critical assumption | Evidence required | Validation approach | Conditions to proceed |
|---|---|---|---|
| Customers will buy | User requirements, budget sources, decision processes, current alternatives and acceptance requirements. | Interview users and budget decision-makers separately, using an explicit service scope to test real purchasing conditions. | Identify a purchasing entity and acceptance criteria, beyond positive reactions to a concept. |
| Value can be realised | Operating conditions affecting results, measurement baselines, customer cooperation and external dependencies. | Test how outcomes arise in representative settings, recording factors outside control or difficult to attribute. | Explain realisation and verification of value, with commitments consistent with the supplier's control. |
| Delivery is sustainable | Staff input, equipment and service costs, exception handling, partner capability and responsibility boundaries. | Use limited delivery to test workloads, service continuity and issue resolution, including hidden costs. | Core delivery has stable owners and resources, with executable arrangements for exceptions. |
| The model can replicate | Differences in rules, demand, assets and delivery conditions across regions and customers. | Compare standard modules with unavoidable customisation and calculate non-shareable resources needed for each additional project. | Define the applicable customer scope, replication prerequisites and conditions unsuitable for expansion. |
Business-model validation framework. Trial evidence applies to its specified context and does not itself establish market validation at scale.
Four checks before the engagement begins
01Have customer needs, purchasing decisions and payment responsibilities each been verified?
02Can the promised improvement be measured and attributed, and which external conditions affect delivery?
03Have hidden coordination, review and after-sales costs been recorded?
04For each new project, which resources must be added and which capabilities can actually be reused?
HOW WE WORK
From diagnosis to implementation.
Three connected levels form the working approach. Select a stage to explore the detail.
Determine who captures value
Distinguish customer improvement from the revenue a supplier can earn. Test whether benefits can be measured, attributed and settled; sector demand does not establish willingness to pay.
Assess delivery boundaries
Review internal and partner capabilities. Specify responsibility for equipment, operations, data and customer relationships, and identify the risks carried by service commitments.
Construct the business model
Connect target customers, service scope, pricing logic, major costs and contract duration. For propositions such as energy savings or flexibility, define the baseline, measurement and verification approach.
Design validation
Arrange interviews, technical tests and trials around the assumptions most critical to commercial viability. Define pass, adjustment and stop conditions in advance to avoid open-ended pilots.
Design partnership arrangements
Compare in-house development, procurement, joint delivery and platform partnerships. Define customer interfaces, responsibility sharing, intellectual property and exit arrangements.
Have the business owner lead a validation brief that records customer commitments, delivery costs and actual use. Pilot evidence should support a commercial judgement as well as demonstrate functions.
Test delivery in a small number of representative settings and establish exception handling and customer feedback. Do not turn pilot experience into scale targets before critical uncertainties are resolved.
During replication, standardise reusable service modules while retaining differences in regional rules, customer demand and asset conditions. Continue to review unit economics.
TANGIBLE OUTPUTS
Deliverables designed for
real work.
Agree depth, data conditions and acceptance criteria at initiation. The engagement scope follows the tasks confirmed by both parties.
Customer needs and value-proposition brief
Business-model and responsibility map
Pilot validation brief
Conditions for scalable delivery and replication
ILLUSTRATIVE SCENARIO
From industrial-park supply to integrated energy services
Illustrative scenarioAn energy business wants to expand integrated energy services for industrial-park customers. This example sets out the sequence for testing commercial assumptions; it includes no actual client or promise of returns.
- 01
Distinguish customer needs for supply reliability, energy costs and carbon information.
- 02
Select an initial service with an identified budget owner and explicit acceptance conditions.
- 03
Use a pilot to verify delivery costs, measurement methods and the cooperation required from customers.
- 04
Once replication conditions are met, define standard service modules, contract boundaries and a regional expansion plan.
BOARDROOM QUESTIONS
Focus the discussion on these choices.
01Which outcomes will customers pay for, and who controls the budget and decision?
02Can existing capabilities deliver the service commitment consistently and support independent verification?
03How many additional, non-shareable resources does each replicated project require?
RESEARCH FOUNDATIONS
Research brought into
consulting practice.
We translate management research and technological advances into working methods for energy businesses. The frameworks below are ZHICE's synthesis of the research and industry questions.
David J. Teece / Strategic Management JournalExplicating Dynamic Capabilities: The Nature and Microfoundations of (Sustainable) Enterprise Performance · 2007-08-07
Application in the ZHICE approachDraws on the theoretical perspectives of sensing opportunities, organising resources and reconfiguring capabilities to connect strategic assumptions with capability allocation.
Scope and limitationsThe paper was written in 2007 and added to SSRN in 2025; the repository date is not a new research date. The five-stage consulting process is ZHICE's own synthesis.
Read the original researchInternational Energy Agency (IEA)World Energy Outlook 2025 · 2025-11-12
Application in the ZHICE approachUses multiple-scenario analysis to distinguish how policy, market and technology changes affect energy businesses.
Scope and limitationsScenarios explore possible pathways rather than certain forecasts. Global scenarios do not replace enterprise or regional project appraisals.
Read the original researchOUR PRACTICE
Explore the critical questions.
Each practice examines diagnosis, solution design, implementation and delivery requirements in detail.
01 / STRATEGY
Energy transition and portfolio strategy
Establish an explicit capital allocation logic across existing assets and new growth.
Diagnosis · Design · ImplementationExplore this practice02 / STRATEGY
Market-based investment and project value
Evaluate revenue sources, market exposure and operating capability together.
Diagnosis · Design · ImplementationExplore this practice03 / STRATEGY
New businesses and business-model design
Start with needs customers will pay to address, then design growth that can be delivered and repeated.
Diagnosis · Design · ImplementationExplore this practiceSTART WITH A DECISION
Start with a decision.
Define the work around it.
Discuss the choices, constraints and evidence needed, then agree the engagement scope and work programme together.