“We are all entrepreneurs but only the lucky ones know they are” Muhammad Yunus Nobel Prize winner & Founder Grameen Bank.
The degree of difficulty of building a business worth $10m or more is almost impossible. You may look at a few superstars creeping onto the stock market with big valuations, or special manufacturers selling out for $100m to a bigger brother but trust me realizing a fortune by selling your business for $10m or more is only going to happen to a tiny percentage of the entrepreneurial population! Mathematically there are 600,000 companies in the US employing 19 people or more and of that 0.9% or 5930 sold out in 2011 for $10m or more. Scary.
The potential for building business value is huge but it is being squandered. We are sleepwalking our way to value. We are working on the wrong stuff. We are complicating matters instead of simplifying them.
“Your goals and your strategy must be simple. You must have passion and certainty in order to make a difference as a leader. Your tactics, on the other hand, should be layered, multi-dimensional and reflect the patience of someone who cares about reaching a goal” Seth Godin.
But you see most entrepreneurs don’t choose one thing to be remarkable at instead they run their businesses like upside down pyramids. Their strategy is multi faceted and multidirectional, crossing over many activities and their tactics are often single threaded, lacking in depth and lacking layers and patience to reach their goal.
Instead think of Seth’s quote above. Articulate a specific simple strategy that you can aim for, the point of the pyramid. Think of your tactics as multi layered and linked to your strategy, spreading out down the pyramid!
Look at Carbonite, does one thing really well. Back ups your computer automatically. Formed in 2005, now worth $300m on Nasdaq. Think of Google’s home page v Yahoo. Simplicity. Think of Apple’s incredible focused desire to build beautifully designed, practical, fast products. ING the fastest growing savings bank in America. From a standing start in 2000, by 2005 it had 3.5m customers, $40Bn under management and no ATMs and no financial advisers but it did have a great savings rate.
But even with a simple and compelling story you will fail if execution is weak. So you need to link that simple goal with world class execution. It’s not about bringing in superstars either. Its about designing appropriate blueprints that your existing staff can use to help you scale the business. OK eventually you will need to augment your team with new talented hires but not immediately.
Keep it simple. Take your new tightly defined positioning (Playbook #1)and think of making it happen in 5 more Playbooks: Marketing, Sales, Product Road Maps, Talent Pool and Metrics. Think in terms of 60 day action plans. Look for quick feedback why its not working because some stuff will not work. Adjust. It could be pricing, targets, service levels, technology, landing pages, poor fit with individual key roles. Whatever it is, adjust. Curate features on products. Try and test quickly. But remember the big goal. Align the efforts of departments to ensure everyone is pulling in the same direction. As a summary, this is how the Playbooks integrate together:
#1 Positioning: Sets the big goal, the big strategic direction of the company. This is who you are. It defines you
# 2 Marketing: The big story is now picked up and blown into small pieces everywhere, boilerplates, web site narratives. blog editorial calendars, marketing metrics measuring your story’s traction, lead generation targets, social media strategy, anything that takes your message to market.
#3 Sales: Scripts are now anchored in the big story lines, consistent with marketing stories. Business results you claim you can deliver for customers are now picked up by well trained sales teams who translate this into parochial relevance for each customer/prospect. Life feels connected. Sales love marketing because the messaging is something they can believe in and the leads that marketing generate (not exclusively) are of a decent quality.
#4 Product Strategy: Now the product team have a strategy to tee off. The Positioning statement effectively defines the product road map. Why build something that doesn’t fit with who you are?
#5 Talent Pool: By defining your story you become so much more compelling to prospective candidates. Job roles (or Performance Profiles as I call them) become easier to define. It’s easier to see what you need to achieve and who needs to achieve it when you have a clear strategy of who you want to be and where you want to go.
#6 Metrics: Who you are is what you measure. A SaaS software business measures different things from an IT consultancy. A high volume contract manufacturer measures different things from a niche, high margin, low volume, materials testing equipment manufacturer.
Your business is either remarkable or invisible. Your choice.
Write to Ian.firstname.lastname@example.org