Focus on Focusing

Entrepreneurs see opportunities everywhere. The upside to this is they create products and services that solve needs others have not seen. The downside is that often their efforts become unfocused and ineffective as they jump from opportunity to opportunity.

Lack of focus in early stage companies can be deadly as they rarely have the financial or human capital required to pursue a large number opportunities at once. Attempting to tackle multiple markets with multiple product lines at the same time can burn through financial resources and also burn through people in the process.

To improve your company’s effectiveness and chances of success, identify what opportunities are worthy of focus and commit to executing against those. To do this, ask yourself some key questions:

1. Are you making the most out of the products and services you currently offer? The saying “A bird in the hand is worth two in the bush” applies here – you may be better focusing on maximizing the return on existing offerings instead of ploughing resources into developing new ones. 
2. How is the new opportunity better than others I am already pursuing? Is there bigger market potential? Does it align more with what I am passionate about? Will it enhance my current offerings?
3. What are the relative risks? While the potential benefits may be greater, what are the additional risks involved with the new opportunity?
   
   
4. What is the opportunity cost? If I dedicate time and money to pursuing the new opportunity, what are the implications on other opportunities? Can I realistically pursue multiple opportunities or will I need to cut some loose? Which ones? 
5. Do we have the time and money to pursue this opportunity? If not, can I realistically secure the resources necessary to achieve success? 

To give you a practical example, I remember back to my days with Immaculate Baking Company when we were looking at adding the refrigerated dough product line. Some advised us to “focus on selling the products you already offer”. This was reasonable advice, but we asked ourselves the questions above and decided that pursing the dough opportunity made sense because:

• We already had significant distribution with our baked cookies and the incremental cost of expanding distribution further was pretty high.
• The opportunity in refrigerated dough was bigger than in baked cookies and the competition less fierce.
• The risks of not pursuing the dough opportunity (slower growth) were higher than the risks of pursuing it (cost of failure).
• The opportunity cost was relatively low as development resources were not being spent on any other projects.
• We had the time and money to pursue the opportunity and felt comfortable that we could secure more if necessary given the nature of the opportunity.

Are you focused on the right opportunities?

“The Principle of the Crooked Wire” – Creating Customer Stickiness

I was introduced to “The Principle of the Crooked Wire” at an event recently.  Toby Stansell of Oobe was the speaker (very dynamic by the way) and he described the concept as another CEO had explained it to him.  Toby has written a blog on it that you can check out here but I wanted to explore the idea a little myself, so here goes…

Imagine the products and/or services you offer as a wire stuck through your customer (see picture).  Each element of your offering that is unique and adds incremental value to the customer beyond what your competitors offer becomes a crook in the wire.  The wire that is most crooked is going to be the most painful and difficult one for the customer to remove.  

Here’s the kicker – the more crooks you have in your wire, the less price sensitive your customer will be.

So what are some ideas to add crooks to your wires?

• Innovate in ways that customers value (and to find out what they value you will probably find talking to them is always a good starting point!):
  • Functionality
  • Cost
  • Quality
  • Lead time
• If you offer a product, think about the service elements that surround it:
  • Ordering process – is it as painless as possible?
  • Delivery – how quick can you turn around orders?
  • Customer Service – how friendly and responsive is your sales and service team?
  • Payment – do you offer the terms customers want convenient methods of payment?
• How can you exceed the customer’s expectations?
• What if you asked your staff for their ideas on things that could be added or improved on?
• What is being done in other markets, industries and geographies that you could apply in your business?

When you start thinking beyond what you currently do and thinking from the customer’s perspective, you may be surprised at the ideas you come up with. 

So go make some crooks in your wire!

Death is Not an Exit Strategy

I was talking with an entrepreneur a while back who proclaimed, “Death is my exit strategy”.  I found this both incredibly funny and somewhat disturbing at the same time.

As an entrepreneur, much of your identity is wrapped up in your business and it can be incredibly hard to separate the two.  When your life has been dedicated to building and running a company, it is understandable for an entrepreneur to go out “with their boots on” but the question is - where does that leave the business?

Real leaders build organizations that eventually no longer need them.  This is not to say they no longer have value to the organization, just that if they got hit by a bus the organization would be in good shape to continue on.

The importance of this really hit home for me recently when the founder of a young organization I work with was suddenly unable to continue to work with the organization.  Thankfully, we had been working for the past year or so to strengthen the team, delegate responsibilities and document many of the organizations’ activities.  Losing his day-to-day involvement has still hit hard, but thanks to the moves we had made to enable the organization to “stand on its own two feet”, we have been able to soldier on.

As an entrepreneur, you may want to sit back and ask yourself:

• What would happen to the organization I have spent years creating if I was hit by a bus?
• Whose shoulders will bear the burden?  My spouse? My business partner? My staff?
• Would they love me or hate me for the state in which my organization was left?

Death is an exit scenario - it is not a strategy.  Uncomfortable as it may be, look at what you do on a daily basis and start to figure out how to manage yourself out of a job.  Who knows, you may even find you enjoy having more time to focus on other things!

Attracting & Retaining Talent in a Small City

I live in Greenville, a small city in Upstate South Carolina.  Like many small cities, Greenville is asking itself, “How do we attract and retain the talent needed to develop economically, culturally and socially?”

Here are a few of my thoughts springing from a focus group discussion on this topic moderated by Greenville Forward.

Perceptions take time to change…
Greenville is physically attractive and positioned well geographically (revitalized downtown, good parks, near the mountains, good climate, close to big cities, etc).  There are plenty of cultural offerings (symphony, performing arts theatres, large indoor arena, ballet, zoo, festivals, etc.) and it has a reasonably diversified economy including a number of big employers (BMW, Michelin, GE, etc.). 

However, unless you have visited Greenville in the last 5 years, you are unlikely to know about all these things and your perception is probably “why would you want to live in a small town like Greenville?”  Your perceptions may even be colored by old “southern” stereotypes or the less-than-favorable press South Carolina has received recently (3 of the top 10 quotes for 2009 were attributed to South Carolinians). 

As with any stereotypes, these can only be changed over the long term. So what can be done in the short term to grow the community of talented young people?

Help organizations sell the city where needed…
Attracting talent that has no pre-existing connection to the city can largely be left to the organizations trying to attract it. Nevertheless, some services can be offered to these organizations to make it easier for them to “sell” the city.  The City of Greenville does a pretty good job on “general stuff” (parks, facilities, entertainment options etc).  However, providing access to information that may help attract talent that has specific interests is also important and does not seem to be done so well (e.g. connecting to specific clubs, associations, non-profits, etc.).  Having all of this information easily accessible in one place online is ideal.

 
Build on what you have…
Rather than attracting new talent, focus should be on addressing the needs of talent that already has a connection to the city:

• Born and raised here and/or have family here
• Went to college here and/or have friends here
• Have/had d a job here and want to stay here

This is the talent that is most likely to stay in or come back to Greenville so it makes sense to build on this existing foundation rather than starting from scratch.  So how do you do this?

 
Prevent “Talent Frustration”…
With talent that does have pre-existing connections to Greenville, the key is ensuring this talent can become (and stay) engaged to its full potential. Any disconnect between their talents and their ability engage those talents results in "talent frustration".  Talent frustration equals lost productivity and the talent may eventually give up and leave town for better opportunities elsewhere. 

How do you prevent “talent frustration”?

1. Engage the talent in organizations and groups that strengthen the community around them and provide them with the types of social interactions they desire. E.g. non-profits, arts organizations, sports, etc.
2. Engage the talent in a fulfilling career.

Engage talent in “extra-curricular” groups…
This is relatively easy as talent is typically looking for ways to get engaged in things they are passionate about. If the city has a networking and leadership development organization for young talent (for example, Greenville has the PULSE group and Leadership Greenville) these groups could build a way for organizations to "post" opportunities for talented young folks to check out, submit applications and get engaged in non-profit committees, boards, associations, etc.

Success does also require a desire on the organizations’ part to welcome that talent with open arms - sometimes this is the hard part…

Engage talent in fulfilling careers…
This is a somewhat more difficult issue to address.  Some of the questions a city should ask itself:

• Do enough career opportunities exist to fulfill the talent that is already here?  If the answer is “No”:
  • What opportunities is the talent looking for? Small companies, big companies, low tech, high tech, specific industries, etc.
  • Do local entrepreneurs have the help they need to start a company, survive and grow?
• Do companies have a struggle finding the specific talent they need here? If the answer is “Yes”:
  • How are they looking for talent?  Are there resources they are not using?
  • How does talent find out about companies that may want/need their talent? 
  • Are there enough industry-specific forums to connect companies with great talent? E.g. Greenville has the GSATC for technology talent which is a good start but what about other industries?

This is just scratching the surface of some of the issues surrounding talent attraction and retention in a small city – what are your thoughts and ideas?

Tech Shops Help "Tinkerers"

Check out the TechShop that has been established in Durham.  

Its a 25,000 square-foot membership-based workshop that provides members with access to tools and equipment, instruction, and a creative and supportive community of likeminded people so you can build the things you have always wanted to make.  

As stated on the website, this facility is, "perfect for inventors, makers, hackers, tinkerers, artists, roboteers, families, entrepreneurs, youth groups, robotic teams, arts and crafts enthusiasts, and anyone else who ever wanted to do something, but couldn’t."

This looks like a fabulous resource and is a model that could be replicated in other cities to help lower the barriers between great ideas and execution.