Does your business always seem to be trying to catch up with new competitors and changes in the marketplace? One of the things I learned from my years in Silicon Valley is that you must always focus on three steps ahead, as well as on what exists today.
For most businesses, that means a culture of thinking outside your comfort zone, and planning change before a crisis hits.
By definition, new startups have to do this to even have a shot at funding from venture capitalists and survival, but I find that existing companies often rest on their laurels far too long. Why else would name brands with huge resources, like Blockbuster and Kodak, get overrun by upstarts like Netflix and Apple?
You can’t ignore the key principles preached by every innovative entrepreneur:
1. Build tomorrow’s opportunity rather than extend today’s.
Don’t be trapped by linear thinking. If your business today is healthcare, it may be time to look for opportunities in artificial intelligence (AI), robotics, and digital data management, rather than just more unhealthy customers. You can bet some startups are already out there looking.
Another way that I recommend to find new opportunities is to look for new problems to solve, rather than new ways to sell your existing solution. Don’t let your familiarity with your existing solution blind you to the potential of related, but different new solutions.
2. Think about needs from a global perspective versus local.
Now that all customer shopping and e-commerce via the Internet is worldwide, the old adage of business location, location, location, no longer should constrain your plans. Even if your business is local, like ride sharing, think about the potential for emerging markets in new countries.
Even if you believe your business is local today, think global for future growth. Early mistakes can result in later business constraints. You may recall the Chevy Nova, where Latino countries quickly picked up on the name, ‘no va’ meaning ‘does not go’ in Spanish.
3. Look outside your industry for new technologies and models.
Entrepreneurs are always looking for breakthroughs and business models in other industries that can be adapted to a new one. You should be able to do that even better, if you adopt that approach as a mindset, and do it before the crisis. The possibilities are endless.
4. Recruit and reward a small integrated team to break boundaries.
Many companies I know claim to do this, but few provide more than lip service to this approach. Don’t count on good employees grown internally, and don’t make it only a sporadic effort. Remember to reward the learning from failures, and maintain a broad diversity of talent and thinking.
5. Reduce risk by doing small experiments in new environments.
Just because you have the resources, don’t try to roll out a huge new initiative all at once, which can fail and sink your bread-and-butter business. A series of small market experiments is more effective in finding breakthroughs, as well as surviving the unknowns of a new market.
Amazon and Jeff Bezos credit much of their continued growth and success to funding change “experiments.” Bezos believes that if you double the number of experiments you do per year, you’re going to double your agility, and thus outpace your competitors.
6. Capitalize on existing strengths to roll-out new initiatives.
Remember that startup competitors will always be limited by available funding, people, and operational systems. If you already have the support and distribution systems to complement a new offering, and you should use that to attract loyal customers and counter competitors.
7. Adopt a higher purpose and showcase it the world.
Businesses with a higher purpose, like Patagonia making clothes in a sustainable way, let their purpose inspire customers and profits, rather than let profits lead to growth. Today’s world is full of purpose opportunities, such as feeding the hungry and protecting the environment.
8. Become the innovation champion inside your business.
Without even realizing it, existing company leaders often foster a culture of “no change,” by establishing fixed processes and penalizing any deviation by the team. It’s up to you to communicate the positive need for innovation, reward change ideas and actions, and set the culture.
Today’s highly volatile environment, and global communication, make the ability to look ahead and proactively implement changes to satisfy future market opportunities a critical strategy for company survival.
I suggest you take a hard look at your own mindset, and your current business culture, to see how you stack up against the most aggressive entrepreneurs in Silicon Valley.