Posts Tagged ‘strategy’

A Value adding analysis

Monday, October 26th, 2009

A colleague of mine Kevin tweeted a URL about Agile Software Development.

Whilst agile software is smart, I realised there is broadly 2 types of activities in your company. 2 sorts of activities that you can spend your time on.

The first, is those things you activities think you need to do. Like write software documentation (in the case of agile software). But the documentation costs time and money, and is generally costly, and if you think about the value its delivering is small.

The manifesto says ‘working software’ is better than documentation. So perhaps if you spend more time on better software, you can waste less on other support costs. Like, did you ever read a manual to using google search ? How about picking up a manual to Microsoft excel ? enough said.

I think this idea can be extended to many areas of business. A bit more time spent on design, planning. And less time spent on running the business.

A better product, or a more streamlined business practices, means spending less time and money on more wasteful activities.

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The velocity of business

Monday, February 2nd, 2009

Its important to not only achieve profit, its the time period in which you can achieve it in.

For small business – this doesn’t seem obvious at first.

You need to become successful and profitable NOW, not next year, and definately not ‘one-day’.

You need to make the hard decisions, make the big changes, and have your success now.

If you wait, and go slow, your life will dribble away, and your business will just be wasting your time.

So when you are planning – move the horizon to something closer, make it immediate.

A lot of this depends on the owner of the business to implement, and its the old “work in the business, versus working on the business’. I think you need 30%-60% of your time spent working ‘on the business’ – being planning strategy, marketing, and working with partners etc.

If you are a public company, you have shareholders demanding profit this year, so generally there is a mandate to get things done. If you are privately owned, you can just wonder around, with little or no growth if you don’t get stuck into the changes now.

Google talks about velocity of business.

If its worth doing, is worth planning,
if its worth planning its worth doing,
if its worth doing its worth doing NOW.

Bring those plans sooner and faster. Bring the profit NOW.

In order to achieve sooner and faster you need:
– time – reorganise your time to work on the business (see above)
– skills – for planning growth, marketing, branding, sales – perhaps outsource some of this
– motivation / inspiration

If you need motivation / inspiration, read these :

Think Big – Donald Trump

Think 10x – Michael Hewitt-Gleeson

Be passionate – Charles Kovess

Two of these guys above I wrote about here

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When Its Wrong to Innovate

Monday, January 26th, 2009

You need more profit, growth , and product changes. You know you need to differentiate , niche, position , brand and develop loyalty.

This is all innovation.

Seth Godin says you need to be remarkable. This helps reinforce – small changes, or bandaids, are generally not enough.

Surely you can’t make or review all these changes at once. You need a structure to help you reduce clutter and focus.

You can make innovation at several distrinct places in your company:
– business model
– marketing strategy
– branding innovation
– product changes
– pricing changes
– sales techniques
– customer service changes
– customer retention plans
– customer referral

Changes towards the top of the list generally cost more, requires more vision, and generally is a bigger risk.

The bigger changes (towards the top of the list) clearly require more buyin – from higher levels of management, the CEO, and even the board.

You will also have the potention to make much more profit from the innovative changes that are more aggressive. You can literally blow open a market, and make competitors irrelevant by business model changes.

Having said bigger is better, many innovations might be WRONG for you:
– you might like smaller changes – so you can manage the risk
– you might not have senior enough buyin
– you might not be able to find the right ideas
– you may not require big changes to meet your goals

As you get more comfortable with innovation, you will find the real value is innovation at more than one level at the same time, like:
– branding and pricing changes
– business model and changes in marketing channels

But again, starting with smaller changes, with one dimension is easier, and less risk to start with.

My suggestion would be for you to work out:
– what are your goals for the company
– do you need small incremental change, or do you need more significant change
– what sort of senior buyin do you have ?
– how much risk can you stomach ?

Targeting your effort to where innovation will best fit your organisation’s needs should now be the obvious answer.

So when you hear – “we need product or price changes” – ask yourself – is that the WRONG place to innovate ?

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Being competitive in the Experience Economy

Sunday, January 25th, 2009

Just listened to podcast from Phil McKinney. He spoke about the ‘experience economy’. Roughly its like why is going to DisneyLand a premium over the local ride park. How does Harely generate such an emotional response ? You pay a premium to get an experience, as opposed just to a fun night out.

Obviously much of this is just strong branding over a long period of time.

It also occured to me, you need to understand where the experience is in your industry. Then you need to go and own that experience.

I’ll reference ‘Circ de Soleil’ and the book Blue Ocean Strategy. BlueOcean talked about Circ-de-Soleil beat out circuses, by making the acts faceless, and removing the expensive actors (both animals and invididual stars). BlueOcean was able to control costs, focus on a better paying market charging a premium price. Less costs and premium prices – now that’s profit.

Here I am saying Circ-de-Soleil owned the experience. Its like running an art gallery perhaps, you dont want to be at the beck-and-call of the art industry, as to who will show in your gallery.

You need to own the experience – not the artists. You need to still make the same money, if you change artists, someone else signs your star. This also stops a star leveraging their value for more pay.

Another good example is say – ‘Kaos Comedy Restaurants’. Having the waiters be funny, tell jokes, and be rude – all part of the night. They owned the experience, and not the artists.

RedBubble seems to be generating lots of attention, and recently won a cool-company award. They own the platform and the community in which the art is shown. RedBubble aren’t in trouble if a single artist goes. You dont go to redbubble to get to just one artist.

I guess this is ultimately what will put Hoyts out of business. They don’t own the movies. No-one is loyal to Hoyts – we’ll go where the movies (the art) goes. OK – they still have some experience going to the cinema.

Hoyts whole ‘only at the movies’ campaign is rediculous. For the life of me – I cant understand why Hoyts dont market ‘better at the movies’ – ‘or more fun at the movies’, or do lifestyle marketing. The only edge/value they have left is the experience – yet they market about the movie itself.

I can even see a time, when a huge star disintermediates the whole movie industry, and sells direct over the web, DRM protected movies. Like the next star wars movie – ‘only on the web’. But that’s another story.

Don’t let your company be the next circus or the next Hoyts.

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Marketing activity = Danger Will Robinson !

Sunday, January 25th, 2009

How to know when your company is in danger from poor marketing planning.

“we need a new website, we need a CRM. Our last 3 web sites didn’t work – we need a better one.”

If you are thinking about marketing tactics – then that is the mistake.

If you don’t have a bigger vision, and an understanding of why you are investing in each marketing tactic, then you WILL fail.

If you can’t clearly and distrinctly describe the aims of your website, the branding it needs to promote, what interactions you want to promote. Then your screwed.

You need to take a step make, and to some marketing strategy, as opposed to planning/investing in marketing tactics.

Lots of small business owners want to see action, and don’t value sitting around talking, and strategizing. The only problem, that’s exactly what you need to be doing.

Now I know these sound contrite – but here is a starter of documents you need to consider.

Mission Statement
Vision Statement
Benefit Statement
Positioning Statement
Value Proposition
Unique Sales Proposition
Strategic Differentiation Statement
Brand
Brand Promise
Brand Identity

Now imagine you went to your web developer, or marketing planner, and said please read through these. We need your input on a new website that better supports our vision/brand/value to the market. We want to website to help us better interact with new prospects.

You and the website developer now have a shared understanding of what you are attempting to achieve. You can at least converse based on this understanding.

And when they do come up with website concepts, and ask you about the AI. All you have to do is judge it on how it meets your stated goals – not does it look cool.

So the next time someone is talking about redoing a website, or new brochures, or change the tele marketing tacticts. And the DONT give you some idea of the vision/branding/value – then DANGER WILL ROBINSON !

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