The world of business is becoming less predictable and increasingly competitive. We often hear stats that upwards of 50% of new businesses in the UK fail in the first five years. So, what can those who are brave (or mad) enough to launch a business do to prevent themselves becoming a part of this statistic?
Qualify your opportunity
In order for your business to be successful, you must be able to demonstrate that your product or service, whatever it may be, responds to a true market opportunity in a unique and valuable way. That might sound simple, but unfortunately in the business world all too often we see products that are ‘a solution looking for a problem’, rather than the other way around. This is not to say that once you’ve identified where you can win, you’ll be successful overnight – but in most cases, building your proposition around a real solution to a particular problem, or opportunity is the best foundation.
Question your proposition
Once you’ve come up with a solid concept, question everything about it. If you have a prototype, show it to knowledgeable people in your field – ideally with someone you don’t know (to avoid the ugly baby syndrome that sets so many businesses off with false hope). If it comes out the other side relatively unscathed, then you know you’ve got a good idea on your hands that you can begin to tweak and perfect. The popular maxim “ fail fast “ is one I particularly dislike, I much prefer “test fast , win fast – or move on”!
Install the right leader
Have you noticed how technical minds don’t always make the best leaders? Now before I get angry letters, let me clarify – although there are many technically-minded engineers and scientists who also make fantastic leaders, sometimes those who are closest to the creation and development of a product aren’t best placed to head the business operations of the company. Although the success of the company relies ultimately on the strength of your product, you also need great leaders, business plan writers, capital raisers and managers in place to give the businesses the best possible chance of success. Also, don’t be blinded feeling the need to do it all – you need to work with a variety of skilled individuals and enable them to lead effectively.
Know your audience
Who are the people that will benefit from the solution your product is offering? How will things change for them as a result? You need to know exactly who the people you’re selling to are. Spend time where they spend time (virtually and in the real world). Get down to the nitty gritty of what the problem they’re facing is and don’t just take things at face value. And remember the problem you’re initially asked to address, may not necessarily be the real problem that person or business faces. Always consider the business context in which the problem exists e.g. does the customer need cheaper components, or do they need to design a better solution removing the component? Try walking a mile in shoes worn by the CEO of your customer – what keeps them awake at night? What pressures are they under? How can you help them achieve their corporate goals?
Key performance indicators are a great way to measure what you’ve done, but that’s not what wins or keeps contracts, or gets people’s buy-in. Use your emotional intelligence to gauge if things are going the right way. The graphs might be looking good, but what is your customers’ underlying behaviour: do they visit, do they spend development money with you or do joint innovations? Is your team excited and passionate about what you’re offering the market? Raw data is valuable, but it can’t account for everything. Make sure you are in synch with your team and your customers to stay ahead.
Under commit and over deliver
It’s an old one but a good one. Don’t oversell what you’re offering, but do strive to exceed expectations – an excellent formula for retaining contracts, and winning new ones. Try to satisfy all those who make your business work – internal customers and stakeholders are just as important as external stakeholders.
The business world is moving faster and more unpredictably than ever before, so keep thinking about the direction of the company to get the best results for everyone. Watch the trends (but beware of fads) and invest in the opportunities of tomorrow whilst catering for the needs of today.
Business is like algebra. You’ll have to bear with me – I spend most of my time with engineers and scientists, so this usually goes down well. Like an algebraic equation, business is full of some knowns and some unknowns, some fixed numbers and some variables that are all inter-related. Sometimes you know some of the numbers and sometimes you don’t. Sometimes relatively simple equations turn into more complex simultaneous equations. But that’s what business is, and solving the equation on a regular basis is the key to success and scaling truly world class companies. Identify your known and unknowns and things will add up.
There is a variable and often unaccounted-for factor in business success, and that is luck. Some of the most prominent business leaders put their success down to good luck.
But remember, diligence is the mother of good luck – don’t expect to get lucky sitting in the office waiting for a fantastic opportunity to present itself. Get out there, listen, observe, engage with your teams, your customers and your suppliers, drive innovation, do your algebra and most importantly, cultivate and create an environment in which to get lucky.
By Stuart Bain, CEO of DesignLED Products