Life Is Not A Dress Rehearsal

O.K. you entrepreneurs out there, this is where the “rubber meets the road.”   It is now a new year….are you ready to jump into the world of owning your own business?  As Nike says, “just do it!”   

HOWEVER, BE SURE YOU ARE REALLY READY OR YOU WILL FAIL! 

The title of this post says it all… “Life is not a dress rehearsal.”  If you feel passionate about a business you would like to be in and have done your homework, then now or never as they say.  Let’s talk about your homework:

1.  Is your idea truly unique in the marketplace?

2.  Does it meet a real need that consumers or customers have?

3.  Can you deliver your product or service with excellence to meet that need?

4.  Will you have a sustainable point of differentiation versus others in the same category?

5.  Do you have a viable business plan including conservative sales, margin, and overhead assumptions?

6.  Have you developed a financing plan?  With contingencies?

7.  Have you built in other contingencies both “upside” and “downside”?  What if you succeed beyond your wildest dreams?  What if your estimates fall short?  What plans do you have for these types of contingencies?

8.  Do you have great “advisers” helping you?  Lawyers, Accountants, business advisers?

Assuming you have really done your homework, the go for it!!!!   Remember  “Life is not a dress rehearsal.”

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

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More on Getting Personal

In a recent post, I wrote about the need for Companies to better customize their products to meet the exact needs of their customers.  Well, the holidays provided me with a perfect example.  Let’s look at all the devices you can currently carry…. The IPOD, cell phone, PDA, notebook computer, digital camera, etc.   If I wanted to buy a device which was “customized” just to my needs and desires, I could not find one.

We are talking about the Dell model to some degree.  What if you could go on-line and order a cell phone with a pink skin, which also included a calendar, games, digital camera, digital movie camera, IPOD with your favorite songs, was bluetooth enabled, and had a picture of your family on the screen?   But, you say you can already do this?   Perhaps, but can you only choose those features you want, in the color you want, and the size that you want?  I don’t think so.  What if you added a few features like opening your car door, or, for those cars that are keyless, allowing you to start your car?  What about turning on your lights at home?  Perhaps your device could even monitor your heart rate.  Or, even store all your medical records.

So, personalization in this area has a long way to go….  

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

Segmentation

Every product or service appeals to a specific group of people.  The key, of course, is to properly identify that group and then be sure your strategies, product development efforts, packaging, pricing, advertising, and other elements of your marketing mix are properly aligned to that group. 

Of course, every business would like to sell its products/services to everyone.  Unfortunately, this “attitude” leads to poor strategic decisions and inefficient use of resources.  The word “niche” has been used frequently of late to describe markets.  In truth, if your Company can find and successfully develop niche markets in which you can achieve leadership share levels, you will find that you will be better off then competing in major mass markets.  This is obviously particularly true if you do not have the necessary resources to “dance with the elephants.”

Indeed, if you can find niche markets where you can provide significant innovation to meet unmet customer needs, you can also achieve better pricing and margins.

So, as you examine your business opportunities, do not automatically lean toward the biggest markets but, rather, examine where you can provide real competitive advantage which is sustainable.  You may be surprised that niche markets provide you with a greater profit opportunity then bigger markets.

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

The Importance of Competitive Intelligence

How much time do you spend trying to learn about your competitors?  How important is this activity to your business success?  Do you examine their products from a manufacturing point of view?  What about their packaging, pricing, promotion, advertising?  Do you really understand who runs their businesses?  Their backgrounds and experiences?  Do you try to construct their strategies?  Do you do third party research with your customers to examine your customers’ strengths and weaknesses?

If you are not doing most of the above, you may be overlooking a critical element in competing in today’s marketplace.   How can you plan from a strategic and tactical point of view without as much knowledge about your competition as possible?  Just think how much more effective your plans could be if you had this knowledge.

But, you say it is impossible to get most of this information?  Nonsense.  In today’s information age, you can get almost any information.  You can certainly get answers to all of the above and much more.  You can use outside consultants where appropriate to interview customers and suppliers as well as past employees of your competition.  And, there is a wealth of information available on the Internet, especially for public companies.

So, gather as much competitive intelligence as you can.  You will be surprised how helpful this information will be during your planning cycle.

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

Role of Directors in A New Company

What role do directors play in a new Company?   Are they “advisors?”  What about their fiduciary responsibility to shareholders?  What if the Company is “controlled” by one stockholder?

In start-up situations, Directors are typically chosen by the founders or if venture capital is involved, by the venture capital firm.  Regardless of where they came from, I believe a Director has a number of responsibilities:

1.  To understand the business.  Both the Company’s business and its competitors.  To effectively fulfill this responsibility, a Director must immerse himself/herself in the business and learn everything possible about the operations, product(s), customers and competitors.  This must entail interviews with numerous people and obtaining all written strategic and planning documentation from the Company.    Without this knowledge, a Director cannot adequately fulfill his responsibilities;

2.  To clearly understand the finances of the Company.  This must include corporate structure, balance sheet, P&L, business “model” and financial plan, etc.  Benchmarks should be obtained within the industry to do a “reality check” on business plans.

3.  Of course, the most important responsibility of Directors is ensuring that all stockholders and stakeholders are treated honestly and fairly.  This is the overriding responsibility of Directors.  Thus examining the best way forward for a Company from a financial and strategic point-of-view becomes paramount.

4.  Independence is also critical.  You must have Directors on your Board who are truly independent.  Thus they do not work for the C0mpany either directly or indirectly.

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

Free Sex

I really hesitated to write this post for the obvious reasons.  I know I will get many “junk” hits.  On the other hand, it will prove my case that when the right words are used to persuade customers to buy your product they can be very powerful.  

Obviously, the words “free” and “sex” are clearly 2 of the most powerful words in the English language.  “Free” is used constantly in promoting products.  I won’t even “touch” sex.  So when you think about how to promote your product(s) and/or service(s), focus on what will really motivate customers (current and new) to buy.  This is particularly vital if you are introducing a new product or service.  What “offers” or “incentives” can you provide to get customers to try your product/service.  Hopefully, if your product is truly as good as you think and better then competition, then getting customers to buy again will be much less of an issue. 

Getting customers into your “franchise” is step one.  So be sure you emphasize your critical point of difference and then provide a motivating force to get them to buy!

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

Is TV Dead?

What will the future hold for TV?   Is Google’s bet that the Internet will replace TV at least in Advertising correct?  Only time will tell.  However, in the fast changing world in which we live, nothing should surprise us.   There is no question that as the “Internet generation” continues to mature, this form of communication and information will become more and more a “regular” part of our lives.  It will be so integrated into what we do that we will no longer view it as “special” or “new.”  Much like radio, TV, and mobile phones, the Internet will be an “accepted” part of our routine. 

 The “big” question, of course, is how fast and how will this impact our businesses?  This discussion reminds me of the “paperless society” everyone talked about when computers began to appear.  Everyone predicted that paper would become obsolete since everyone could store everything on their computers.  Guess what….  There is more paper used today then ever before.   So, how might this parallel the Internet versus TV?   My bet is that TV will be here for a very long time.  However, it will become totally integrated with the Internet.  So, for example, like the DVR’s you will be able to watch what you want and when you want via the  Internet.  Microsoft certainly believes in this future.  Google apparently does as well.

What are the implications of this future “vision” for your business?  For one thing, you better start experimenting with all of the new Internet media alternatives available including blogs, You Tube, My Space, viral marketing, etc.  Next, you must work with all legitimate newer Companies in this “space.”  Of course, you must keep in close contact with the entire entertainment “world” including Cable, Networks, Radio, Movies, Sports, etc.  Many of these companies are already engaged in changing their business models so you must stay current.

In a word, CHANGE is coming and coming fast.  So, be prepared and stay informed.

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

The Company As A Family

How do you run your Company?  Are you a “tyrant.”   I once heard that managers manage either through fear or respect.  What’s your approach?   If you think of a Company as a “family” and treat your employees as members of that “family” what would be the result?  Is it possible to manage via “consensus?”   In a family environment, the mother and father ultimately make all the decisions.  As the kids get older, there are typically discussions involving all parties when it comes to things like vacations, work around the house, etc.  Often compromises are reached on many issues to try to satisfy everyone.

What if you ran your Company that way?  Suppose you called all effected parties into a room and discussed an issue with them and sought out the best solution?  Would the “inmates be running the asylum?”  Or, would your employees feel empowered and motivated?  Of course, the “buck” eventually stops with you and on “tight calls” you are the one who must make a decision.  But, even in that case, if all effected employees had input into the decision don’t you think they will feel better at the end of the day?

So, can you manage a Company like a family?  You bet you can!  Will it be effective?  Yes, if you can train yourself to be a consensus manager. 

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

How Personal Can You Get?

I believe in the concept of segmentation.  The ultimate form of segmentation is personalization.  Can a Company truly design products that are specifically made for the individual needs/wants/requirements of individuals?  Just ask Dell.  They would say yes!  Of course, the dell model still is not totally personal.

Recently, there have been experiments with jeans and shoes where consumers go to a retail outlet and get jeans fitted exactly to their bodies;  also, the same has been done with shoes.  Is this a trend?  What about other product categories?  Can manufacturers deliver truly “customized” and “personalized” products to consumer specifications? 

This question certainly fights the idea of mass production.  but I believe in “mass customization.”  It can easily done with books, magazines, and other printed material given advancements with technology.   Why not shampoo, skin lotions, cereal, etc.?   For example, suppose I wanted a low carp high fiber cereal which contains fruit, nuts, and a touch of yogurt.  Now, I really have no idea if such a cereal exists, but if it does not, couldn’t it be produced especially for me?  Delivery, of course, is another issue.

What about cars.  When you go to buy or lease a car, your options are “dictated” by the manufacturer.  For example, if you want a back-up camera on a Lexus SUV, you must have the navigation system.  Why?   Your colors are limited to what is offered, both inside and out.  Why?  You can only have a certain sound system.  Why?  I know there are issues with production… but this is 2006 and we should have the technology which would allow us to truly customize any product to any consumer needs/wants.

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

Pricing In The Services Business.

I promised in my last post to provide information on the above subject.  Indeed, I have already provided that information in my post dated October 19, 2006.  So, read and enjoy!

Thanks,

Rich

Bizvice:  Strategy, Marketing  & Entrepreneurship