Concentrate on these Five Areas for Success
People - Get good people, they matter most. This
encompasses three categories, employees, partners and customers. Employees
create and implement the value proposition of the business. Partners broaden
your reach and value. Customers are the ultimate arbiters (it used to be
revenues, however, for the Internet, it's get as many customers-eyeballs as
quick as you can).
People - Innovation - Focus - Speed - Equity
If you have the best people, you'll have the best odds of achieving that vast pool of
customers to carry your business aloft. Find startup time to find the right
talent, which will breed more and better employees, partners and customers.
Innovation - Dare to be different- not digital. Business innovation in the Internet space means providing more value for less money--proving better value propositions that cost less and offer more. Keep in mind that cost-less (saving money) encompasses saving time.
The Internet used to be about creativity, today it's about application, it's more about
business-model innovation than product innovation. The best Internet companies
find a way to change the rules for an industry. Amazon is not about selling
books, it's about innovating a new type of retailing via constant new
partnerships, acquisitions and expansion.
If you can, you must. If you can innovate, drop prices, save time, launch a new service, speed delivery--you
must. If there is a better business model to pursue, a better value proposition, you simply must do it. If you're lucky, you will end up with the AOL problem--your customers are mad at you because they can't get enough of your product/service.
Instead of releasing a lot of features (which increases your customer-service problems),
release a small feature set and get as many customers as you can. Small feature
sets mean you get out sooner with greater speed. Internet innovation is
Create benefits, not barriers. The Internet dictates that new services that provide benefits flourish. Focus on
creating customer benefits and continually expanding a better value proposition
for the customer.
Control Capital The ideal Internet capital model is -- release a new product every three to six months so you can
leverage that to raise the next round of financing. It's a capital treadmill; run your business so you hit fund raising milestones to attract the next round to live to fight another day.
Focus - Focus is what brings it to fruition. Selling is the simple value proposition. A focus
on: one-click ordering, great Website design, collaborative filtering, relentlessly increasing the customer experience, all accomplished in the formative stage, fulfill the value proposition.
It is very seductive to try to reach for too much and address too many fronts. Learn to say no. Don't spread your value proposition too thin. Focus on your basis advantage. Don't attempt to be broad-based and hinged to different markets and a multitude of objectives. Startups are baggage-free and hard-wired to gather focus quickly.
Speed - Get out in Front and run like h!!! The best thing to do is to get into the marketplace.
Why? The primary mission is to get customers. Get a product out in four months or go home.
All you get is a chance to compete in the market place with a good team. Speed impresses customers; captures markets, before and hence without challenge; draws capital, which can be used to buy more speed, more innovation more focus and
specialization. The first companies to market merely have to explain the market opportunity; later entrants must justify why they will succeed.
On the Internet, the rules seem to change every six months. Spending three months putting together a detailed contract with a partner--the terms of which most likely are not going to be relevant for long--hardly seems worth the effort. Time spent negotiating contracts, in turn, undermines your time to market.
Successful startups use speed to initiate a feedback loop that converges its offering to best-of-breed. Speed wins! Execution makes you tops!
Equity - The people magnet. The motivator. Stock is never as valuable as when it is startup stock. Equity is also a key lever in accomplishing your primary mission--attracting good people into your company. It's not only what gets them in, it's also what motivates and retains them long enough to achieve some level of success.
Create an innovation, retain good people, which in turn attracts customers. Then use customers to attract capital and then spend
capital to hire better people and attract more capital.
The I-Net Business Summary – In the Internet universe, the entrepreneur needs to tell their story at I-speed. Here are some mandatory hints:
Source: The magazine: Business 2
- The idea must be intuitive
- It must be explained in no more than two sentences
- It must be summarized in no more than 300 words
- Its uniqueness explained in no more than 300 words
Re-engineering To Empowerment
The most popular management fad of the 1980s was "re-engineering"
which encouraged management by the numbers. Even as it promoted
the use of teams and the breakdown of bureaucratic barriers, re-engineering
provided the intellectual rational for managers to cut costs by
dramatically downsizing their work force, boosting work per employee
and pushing profits sharply higher. Re-engineering was a great
deal for shareholders and C.E.O.'s with stock options.
The trouble is that after a decade of shrinking, companies can
no longer make money the easy way, by simply cutting expenses.
They now have to grow and introduce new products. That calls for
creativity, not accounting, and the pendulum is currently swinging
in management theory toward "soft" ideas. Enter empowerment
of employees, decentralization, the business as an organism, even
artist and designer as models of creativity. Go crazy, be ad hoc,
take down the walls, be a learning organization, get New Age.
At the very least, respect the employee as a knowledge worker.
That's were we are now.
(Excerpt from a book review by Bruce Nussbaum-The New York Times-1/12/97
- of the book The Witch Doctors by John Micklethwait and Adrian
Wooldridge-Times Books/Random House)
What an opportunity for entrepreneurs! The large corporations
are back in the market seeking new products, services and companies
to strategic partner with, acquire and buy. Smart entrepreneurs
are creating, conceiving, inventing, beta testing new products
and services and contributing a lot of "value added."
That gives them the edge to continue to cash in on the large corporate
dollars. That's were they should be now.
Leadership Through Learning
The entrepreneurial leader of today faces the challenges of cyberspace, globalization and technology driven change. You can’t be an entrepreneurial leader in a situation of extreme change without the ability to learn at a high rate.
This new focus on learning adds a future oriented dimension to the myriad descriptions of theories about and strategies for leadership. It accepts the reality that the relentless learner has replaced the know-it-all leader. The "leader as a learner" applies a holistic approach to an interlocking global marketplace and integrates information into a vision of the business. The best leader today is the best learner and has the best, most complete map of their company’s organization and its environment.
In today’s business environment, vision involves opportunity-seeking in true entrepreneurial style. The successful entrepreneurs are horizon watchers and "what-if" business leaders. They aren’t just managers as were typical some years back. A manager-leader comparison shows:
- The manager has their eye on the bottom line. The leaders eye is on the horizon
- The manager imitates. The leader originates.
- The manager accepts status quo. The leader challenges it.
- The manager is a "good soldier." The leader is their own person.
- The manager does things right. The leader does the right thing.
- Managers receive power from above—upper management, while leaders get power from below—from those who respond to their leadership and act on it.
Because of our increasing complex business environment, no one leader can get their arms around all the technology that’s available and useful. Hence it’s important that today’s leaders build teams. Consequently, the leading entrepreneurs of today, in reality, are "learning" leaders of teams.
Where Do You Fit In?
There are the four generations in the workplace today; veterans, boomers, x-ers, nexters. Each
is coming from a different place with different values. This synopsis may help you understand how to effectively work with and among them.
Each category is presented with three comments/descriptions;
- The defining events and trends in their lives
- Their general core values
- Their general personality.
VETERANS – Born 1922 to 1943 – 53 million of them
Events/trends - Patriotism, families, great depression, New Deal, World War II, Korean War,
Golden Age of Radio, Silver Screen, Labor Unions.
Core Values – Dedication, sacrifice, hard work, conformity, law and order, patience,
respect for authority, duty before pleasure, adherence to the rules, honor.
Personality – Conformists, conservative spenders, past-oriented, belief in logic- not
BOOMERS – born 1943 to 1960 – 73 million of them
Events/trends – Prosperity, children in the spotlight,
television, suburbia, assassinations, Vietnam, Civil rights, Cold War, Women’s
Lib, space race.
Core Values – Optimism, teamwork, personal gratification,
health and wellness, personal growth, youth, work, involvement.
Personality – Driven, soul-searchers, willing to “go the
extra mile,” love-hate relationship with money.
X-ers – Born 1960 to 1980 – 70 million of them
Events/trends – Watergate, Stagflation, latchkey kids, single parents, MTV, AIDS, computers,
Challenger, Fall of the Berlin Wall, Glasnost, Wall Street frenzy.
Core Values – Diversity, thinking globally, balance, techno literacy, fun, informality, self-reliance, pragmatism.
Personality – Risk-takers, skeptical, family-oriented, focused on job—not work hours.
Nexters – Born 1980 and later – 70 million of them
Events/trends – Computers, school violence, Oklahoma City bombing, TV talk shows, Multiculturalism, girls movement, McGwire and Sosa
Core Values – Confidence, civic duty, achievement, sociability, morality, diversity, street smarts
Personality – Optimistic-yet realistic, prefer collective action, tenacious
Source: The book: Generations at Work – American Management
How to Be the Best
- Improvement - Commit to Learning
- Follow-Up - Respond quickly and decisively
- Vision - Sharpen your focus. Clarity always wins
- Teamwork - Help everybody win. There is no "I" in team
- Relationships - Show genuine interest in everyone you meet
- Expectations - Strive to do better every day. High expectations win
- Consistency - Consistently put the client first, and stay on track
- Integrity - Always tell the truth. Admit your mistakes without delay
- Emotions - Interpret reality objectively. Never put negative labels on events
- Persistence - Never, never, never give up. Ignore people who say it can't be done
- Motivation - Believe in yourself and your product. Set daily goals and keep reaching
- Self-Confidence - Act as if you could never fail. Never let rejection overwhelm you
- Attitude - Turn obstacles into stepping stones. Every setback is an opportunity for growth
Source: Personal Selling Power
Revolution in Five Stages
Technology innovation passes through five stages: experimentation, capitalization, management, hypercompetition, and consolidation. This has been true in steam engines, telegraphy, autos, airplanes and other major technology breakthroughs. This revolution also applies to the Internet.
1. Experimentation - the invention or discovery, be creative and flexible, rarely a single person/group (usually many in diverse locations), experiment with different ways/methods and recombining, persistence, passion.
2. Capitalization - quest for capital - to pay for experimentation and get product/service into the marketplace, big-time. From garage to mass market. 99% of companies never get funded. Vision, connections, salesmanship.
3. Management - Innovators need to know when to step down, tough decision as to when to hand management over to professionals. Building operations, brand, customers and alliances.
4. Hypercompetition - Falter and competition is a step behind, execute boldly and quickly, refine business plan, outbrand competition, input economies of scale, create lot's of luck, only a few succeed.
5. Consolidation - As hypercompetition fades, product's become standardized, marketing is fine-tuned, costs are wrung out, market share defined. Competition for the market becomes competition in the market.
1 & 2 - B2B, e-commerce, ASPs
3 & 4 - Cell phones, B2C, portals
5 - PC makers, ISPs, semiconductor
Source: Forbes ASAP - Hal Varian
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