Month: January 2022

Three Strategic Options to Deal with Inflation. Which one is right for your startup?

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Inflation is particularly difficult for startups. Typically there are three traditional options to tackle inflation, none of which is an attractive choice. You need another approach. A couple of weeks ago I talked about the move from abundance to scarcity we are seeing in many sectors of the economy. To listen click here. With scarcity comes inflation. Based on a poll of economists taken last summer and comments from the US Federal Reserve we may be in an inflationary environment for some years to come. Inflation is particularly difficult for startups. Typically there are three traditional options to tackle inflation, none of which is an attractive choice. You can raise prices and upset your customers. Difficult for startups, you do not have a long history with your customers. They have just started buying from them and now you hit them with a price rise. You can absorb the cost of inflation and cut your margins. Not easy if you are already barely, or not even, covering your overheads. Companies with an established profitable business can …

Can you start a business with no money? Of course! The noble art of bootstrapping. Part 2

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In the episode 13 we looked at why entrepreneurs chose to start their business without external investments. Some of these reasons such as not wanting to share the profits with others, and willing to spend time chasing investors are solid reasons of going the bootstrap approach. Others such as not wanting to prepare a business plan, and fear of not having the necessary marketing skills to my mind are less valid. Any start up should have a business plan and you are going to have to market your product at some point. We also looked at the disadvantages that come with a low investment approach. Primarily the risk of running out of cash, In the episode I will share the advantages of bootstrapping, an approach that I highly recommend. But there are times when bootstrapping is not the right approach and that is when you need to scale fast because of the business you are launching. We will take a look at businesses that are not should not be launched by your bootstraps. The advantages …

Can you start a business with no money? Of course! The noble art of bootstrapping. Part 1

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The noble art of bootstrapping. Taking an idea, using your talent and knowledge and building a worthwhile business without the backing from investors and having little or no start up capital. Unless your fortuitously find yourself in the right place at the right time bootstrapping takes dedication, a strong work ethic and an unswerving eye on the costs. There is a great sense of pride to be gained in starting from nothing and building a viable business. There are financial rewards too, you do not need to share the profits, or the value of the business if you decide to sell, with anyone else. But there are risks among others, without access to funds you risk running out of cash and growth is likely to be slower. Some of the largest companies in the world started out as bootstrapped businesses. Dell Computers, Meta (formerly Facebook) Apple, Microsoft to name just a few. So, bootstrapping does not limit how big you can grow. Although all these companies are now publicly owned and their founders no longer …

Bridging the execution gap. Learn from teams who have achieved success.

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Vision without action is a daydream. Action without vision is a nightmare. Japanese Proverb. No one individual can execute a strategic plan, it must be a team effort if success is to be achieved. Nathan Wiita, and Orla Leonard decided to look at how the most successful teams bridge the execution gap. The gap between what the strategic plan says what needs to be done, compared with what actually gets done. What differentiates teams that achieve success from teams that fail to execute? How do they spend their time? What critical behaviors do they engage in that enables them to attain their goals. The researchers found 4 behaviors that lead to success. Commit to an identity. The successful organizations were committed to a common identity which was achieved by a shared understanding of its value proposition and the distinctive capabilities. These are also known as core competencies an idea developed by Gary Hamel and C. K. Prahalad in 1990. To learn more about core competencies listen to my show on this subject. To listen to …

Six reasons why your strategic plan fails to deliver. The Hidden Barriers and how to identify them. Part 2

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A high percentage of strategic plans fail to deliver their goals. Some experts say it is over 70%. Many articles have been written on how to execute better and we will look at some ideas in today’s episode 7. According to Michael Beer in his HBR article “6 Reasons Your Strategy Isn’t Working”. Published June 2020 there may be hidden barriers preventing your team executing your business strategy Hidden Barrier #4 Poor Coordination, a lack of willingness. Most companies work well within silos but any project worthy of the name strategy will work across silos. Possibly across geographies. And this is where coordination often breaks down. Coordination is critical for the effective implementation of strategies and it always a challenge. Insecure managers will fight to maintain the status quo and retain their empires. They will not be able to agree on how to reorganize, how to reshape the culture to work together to be able to overcome the unavoidable obstacles to coordination and collaboration. If this barrier exists it shows a lack of, or an …

Are there hidden barriers in executing strategy within your company?

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Based on HBR article by Michael Beer “6 Reasons Your Strategy Isn’t Working”. Published June 2020 According to Michael Beer in his HBR article “6 Reasons Your Strategy Isn’t Working”. Published June 2020 there may be hidden barriers preventing your team executing your business strategy Some or all these hidden barriers may exist in your organization. They may go unrecognized; they are often not discussed for fear of the consequences because they address failings in the organization. Often failings in senior management and leadership. Even good strategies will fail if these barriers are present in your organization; because your team cannot execute until these barriers are removed. Hidden Barrier #1 Unclear Values and Conflicting Priorities. This occurs when a strategy is developed without sufficient consultation with the employees at the coal face. The leader of the company along with a few chosen executives formulate a strategy and then communicate the strategy to the organization. This creates several issues. While the strategy may be sound, there will likely be a lack of understanding on how it …