Tag Archives: improving results

Keep Your Business on Track and Growing: Measure What Matters

By Laurie Breitner and Karen Utgoff

There is more to keeping your business going in the right direction than looking at standard reports from QuickBooks or other accounting tools on a regular basis. While these reports can give you numbers, determining and appropriately tracking what matters — which numbers are important, how they are derived and what else you need to watch — is an essential responsibility of the owner(s) and management team.

In assessing current operations, it’s often useful to compare today’s results with past performance — prior period (year, quarter, month, or week) or effort (job run, project, or program) depending on your industry and particulars of your business. While this isn’t always possible for newer ventures, be assured that if you are diligent, ultimately these measurements will help reveal your company’s strengths and weaknesses, opportunities and threats, as well as performance.

For example, after one year in business you can only guess how seasonal factors will affect your cash flow. However, if you keep track, with five years experience you will be confident in anticipating how seasonal ups and downs might impact your business. When you hire a second employee in a particular role, you have some idea of how long it will take them to come up to speed; by the time you make your fifth such hire, you have a much better idea of how long it should take, as well as what it takes, to be productive.

For new initiatives, measuring is tied closely to looking forward (planning) for likely and intended outcomes. What will initial success look like? What events (milestones) are critical to track progress? How much will it likely cost? Are there gaps in your capabilities or resources that need to be filled before you can realize the potential of the new initiative? How much revenue and/or profit is the project expected to add and when?

What initial operational measures should be monitored? Here’s where it’s helpful to look at assumptions you made in making predictions. Did you assume that if you opened a second location in a nearby town that your strong positive reputation would automatically give a boost to the new site? Did your plan hinge on getting speedy municipal approval for a larger parking lot at the next planning board meeting? What key assumptions do you need to track?

Add to the standard routine of just reviewing (daily, weekly, monthly, quarterly, and annual) results with the following specific approaches that are critically important to measuring what matters:

Assess profitability and the fully allocated cost of goods sold from an operational perspective: For background review pages 8 and 9 of Laurie’s Thriving: Get and keep your business on track. Also, check out Karen’s Succeeding in Small Business post on Four tips for putting your business plan to work for your small business.

Project results for new initiatives with limited or no experience: For background, read Four steps to help small business owners evaluate the financial wisdom of new business-building initiatives and Small business management and entrepreneurship: Two key ingredients for sustaining success.

For additional information read Josh Patrick’s article on Every Business Has a Special Number, or Metric. Do You Know Yours? in the NY Times’ “You’re the Boss” blog and A Winning Culture Keeps Score by John Case and Bill Fotsch in the HBR Blog Network.

Here’s how to get started: On a single page, document the (up to) five most important measures, metrics, milestones, and/or numbers that you follow (or plan to track) to gauge whether you are on the right road, moving into the fast lane, or facing an unwanted detour. Review these metrics with your management team, board of advisers, mentors, and/or appropriate professional services providers. Evaluate them regularly to make sure they remain relevant guides for growing your business. Plan to fine tune them over time as your needs and business landscape change and you learn more.

© 2015 Laurie Breitner and Karen Utgoff. All rights reserved.

Find Funding That Fits Your Needs

By Karen Utgoff

2014-09-01 Bags on MoneyDoes external funding appear to be an attractive approach for fueling the growth of your business? Before you leap to a particular funding option, consider four possible types — debt, equity, grants, and crowdfunding. I have written about the first three here and the last here. Each of these can come from a number of sources — for example banks, venture capitalists, or family — and, of course, you may want to mix and match.

In addition to considering which types and sources of funding are accessible given your situation, it’s important to take into account the risks associated with each. Below are some general thoughts; be sure to evaluate terms and conditions associated with each specific deal that you may be offered.

What financial risks are you willing to accept? Debt and equity — borrowing or sharing ownership — have different uses, benefits, and risks.

Banks and other commercial lenders may expect you to commit personal assets (homes, possessions and savings) in addition to company assets as collateral. If your business fails, the obligation to repay lives on. Even when businesses do well, they are often subject to unpredictable cash flows that may interfere with the ability to service debt. Using debt to purchase equipment, finance inventory, or bridge the gap between making a sale and collecting the revenue can work well unless there is concern about slow inventory turnover and/or customers stretching the time they take to pay — both common occurrences in a weakened economy or in the face of intensifying competition.

Angel and venture capital investors put their money at risk for the opportunity to financially benefit from ownership of part of your business, which they hope will significantly increase in value. Their initial investment may be in the form of convertible debt. To protect their position, investors may expect to participate in key decisions and serve on your board of directors. It’s important to understand the obligations that will result if the business fails; ideally investors will agree to take cash and remaining assets but not expect to get their original investment back. Be sure you understand when investors will want to realize a return on their investment. They may expect you to sell the company or to raise the cash to buy them out.

The risks associated with grants and crowdfunding are usually less daunting but can require some specific result such as delivery of a product, recognition of the funder, execution of a proposed project, and/or a report. Grant givers may also have specific accounting requirements or other standard terms you will need to satisfy.

What personal risks are you willing to take on? Even (or especially) when your friends and families are enthusiastic to help your business and spare you financial risks that come with borrowing from a bank or alternative lender, don’t underestimate possible damage to friendships, marriages, and parent-child relationships that could result. Whether you take a loan or offer them equity, they may have naïve and overconfident assumptions about future success.

Consider how you and they would get along if the business falls short of their expectations. Even if you were not obligated to repay in the event of a business failure, how would you feel if your parents or siblings lost their retirement funds?

Even when the business thrives, dealing with family/friend investors/lenders can become awkward. Some may want to help even when they lack the expertise to do so. Others may feel entitled to participate in operating decisions, suggest potential employees or drop in to “see how things are going.” What’s the plan to provide a return on their investment? To avoid awkwardness, or complicating future rounds of funding, clarify expectations and boundaries in advance. A sophisticated investor will welcome this too and may even take the lead on designing an arrangement that makes sense from both business and personal perspectives.

Can you mitigate the risks of and/or reduce your need for funding? While risks associated with external financing are significant, rewards can be substantial. Be sure you are ready to put the funds to work effectively and to make the most of every dollar. Will your team be prepared to make the most of the new opportunities to which the funding will be directed? Could you improve your cash flow to minimize the risk of problematic surprises? Is it possible to reduce the cash tied up in inventory? Is there a contingency plan to manage setbacks and unexpected obstacles?

Do you have evidence, or merely hope, that you will succeed? Whether the funding you seek is to purchase equipment that will increase the efficiency and profitability, to support the launch of a new product/service/location, or to provide stability over a tough period, you should do your homework. Since all forms of funding come with real costs, it’s important that you have evidence that the expected results will be worth the added burden. Will the changes you anticipate make your business stronger? Will they increase its value?

The right financing at the right time can fuel success. The above points are not intended to discourage you from seeking external funding. If they have, ask yourself why? Resolving those concerns can make for a stronger future business.

 

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© Copyright Karen Utgoff. All rights reserved.

Look Before You Leap

By Laurie Breitner

Public domain. U.S. Air Force photo by Tech. Sgt. Jeremy T. Lock

U.S. Air Force photo by Tech. Sgt. Jeremy T. Lock. Public domain.

Too many entrepreneurs believe raising funds to finance their idea is a first step when starting a new business or expanding an existing one. Some create business plans — often only to satisfy lending guidelines — and head off to shop their ideas at banks or other funding sources. I have known people who depleted their retirement savings, put their homes at risk, and/or tapped friends and relatives with promises of great returns only to discover that they had not done their homework.

While starting or growing a business always involves some risk, none of us wants to take on more than is necessary. Before taking a financial leap, be certain that you can answer these questions thoroughly and with confidence — that is, you have some empirical evidence and/or analysis to back up your passion:

Does your plan have legs? Have you tested your idea to determine that you know and can reach your target market and that your planned offering meets their needs? Please don’t assume that if you “build a better mousetrap” that people will flock to your door to buy one. Instead, talk to potential customers; gauge their interest and learn more about their needs and some obstacles you will likely have to overcome. Also, consider the competition — there is always competition — for your target market’s dollars. How would your business woo customers?

What resources do you have/will you need to be successful? It is essential to have as full an understanding as possible of what resources (expertise, suppliers, location, marketing collateral, forms/contracts, etc.) you have and will need to be successful. If you plan a foray into a new business or market, find someone to help you better detail what’s needed. Consider visiting a library to access industry surveys and statistics (UMass Business Library), getting how-to information from industry associations, talking to business owners in a similar business that serve different geographical markets, and checking out industry discussions on LinkedIn and other web sources.

How long will it be before your plan starts generating revenue? Is your product/service well understood, or will you need to mount an educational effort to explain its uses and benefits? Consider your sales cycle (the elapsed time from initial contact to receiving payment). Do customers make buying decisions immediately, or is there a delay to get approvals, consider alternatives, etc. Typically, how quickly does your target market pay? If you plan to open a retail store, you could realistically expect payment at purchase. If, however, you plan to sell to government agencies, expect significant delays.

Can you start smaller? Many entrepreneurs are so bullish on their products/services and excited by their potential that they seek to fulfill the needs of multiple markets with a range of offerings. What is your low-hanging fruit? Is there a niche market that you could enter to build a satisfied/loyal customer base? Consider starting small to learn what works — and doesn’t — before making a larger investment.

How much will it really take to get your plan off the ground? It’s generally safer to be conservative; no one goes out of business by having too much cash. Before you head off to borrow money, consider whether you could fund your initial foray with cash from on-going operations? For a new venture, is it possible to keep your current job (and income) while building your new business on the side? Many couples/partners who want to open a joint business do so by having one work in the new business and the other stay in their current job to keep the financial boat afloat until the new venture starts to make enough money to support both. Typically it takes about 3 years for a new business to be able to support its owner.

How will you measure success? Some entrepreneurs wait until they start generating P&Ls (profit and loss statements) before looking at results. Instead, put together a project plan (with measurable milestones) as early as possible. This is difficult to do, especially without a history of operating results, but the process will help you think through the business challenges ahead. The information you need for your guesstimates will help you with early steps for the business itself — e.g., identify/vet suppliers, develop a sales plan and marketing materials, etc. — and become one yardstick to measure your progress. Adjust revenue projections and planned expenses as you learn. By having a documented plan to help you monitor progress, you will be more nimble and able to uncover small speed bumps before they become major obstacles.

If you learn that you will need outside funding, most banks and other funding sources will appreciate your diligence. And, you will have more confidence during the inevitable tough times when you are doing all the essential pre-work before your earn that satisfying first dollar from your new venture.

© Copyright Laurie Breitner. All rights reserved.

Row, Row, Row Your Boat: Are You Missing Warning Signs of Rough Water Ahead?

By Laurie Breitner

Winslow Homer [Public domain], via Wikimedia Commons

Rowing Home, Winslow Homer [Public domain], via Wikimedia Commons

Do you know what your employees are doing? While you may think you do — perhaps not. Whether yours is a relatively new entity, or one that’s been cruising smoothly for some time, it’s easy for issues to develop and go unexamined in the daily crush of getting the job done. This slow drift off course can interrupt the smooth flow that results when all your employees pull together.

These real world stories illustrate what can happen.

  • The owner of company that sells through external, commission-based sales staff was very surprised to learn that the 3:00 PM cutoff for same-day orders was being routinely ignored. Fulfillment staff — operating on the assumption that the owner knew and approved — struggled to satisfy orders that arrived later and later. Sales staff had quickly learned that fulfillment workers were staying late to process orders and took full advantage of an ever broadening window to call in their sales. Employee morale had begun to plummet and “sick” days to increase.
  • A tech company owner could see his staff was buried but didn’t have time to examine why. Overtime hours (and resultant costs) grew and employees seemed frazzled. The owner was wearing so many different hats  — executive, senior technician, salesman, and accountant — he didn’t have time to look into what was happening. Profits margins were eroding and he worried that his skilled workers could burn out or leave.

Many business owners recognize when things aren’t right. But because root causes can be hard to find and talking to employees without a solution can be uncomfortable, some find it tempting to simply hope the situation will improve without taking action. Left unattended what starts as a small problem can rapidly become a crisis; in my experience, it’s best to act swiftly. The longer a problem persists, the harder it is to fix.

The first step is to identify issues as early as possible. What might alert you to potential problems?

  • Declining morale is often the earliest and most obvious sign that everyone is not in sync. Symptoms include increased squabbling, turnover, absenteeism and tardiness, complaints about co-workers, cynicism and/or employees acting as if they are “checked out.” One business owner asked me, why couldn’t it be the way it used to be, everyone pulling together? Do you ever wonder that?
  • An unexpected increase in cost of goods sold (CoGS) and/or decrease in overall profitability are signs that inefficiencies may be creeping in. As a business grows and becomes more complex, spending time to design new workflows or clarify roles and responsibilities often takes a back seat to just getting through each day’s work. Whether your organization has grown, taken on new customers, changed computer systems or begun offering new services, involve affected employees in determining necessary adjustments. Otherwise, you may find gaps and/or overlaps, that is, more than one person feels responsible for a new task or no one does it; either can lead to trouble.
  • Unanticipated defections (or reductions in volume of purchases) of existing customers or an overall drop off in sales may result from dissatisfaction with your company. Front line employees are your organization’s ambassadors. If they are discontent, your customers will sense it and may shy away. Similarly, if a new computer system or vendor causes disruptions in the smooth flow of work, the quality of your products or services may suffer sending customers to the competition And, sadly, long-time customers may be uncomfortable raising their concerns with you, the owner, and just disappear.

While these are common signs, each organization is unique; no list of triggers can be exhaustive.

Here’s where your business plan comes in handy. If you have projected what will occur in terms of sales, staffing, and profitability — and documented your assumptions, of course — you can look periodically (at least monthly) for any deviations from what you thought would happen. Work with employees to get to the bottom of unexpected results — whether they are better or worse. Most employees sincerely want to do a good job and will appreciate being involved.

Are you looking for other ideas to help create and maintain a harmonious and efficient organization?

In my next few posts I’ll explore how to get and keep your organization on track, including ways to address inefficiencies and issues related to employee discontent.

© Copyright 2013 Laurie Breitner. All rights reserved.

Want to Be a More Effective Decision Maker? Beware of Blind Spots and Biases that Can Interfere

By Karen Utgoff

In business and driving, beware of what you can't see. Photo: K. Utgoff

In business and driving, beware of what you can’t see. Photo: K. Utgoff

Business decisions are made every day and mistakes are inevitable — none of us can read minds, know the future, or wait for perfect information. However, it’s sad and unnecessarily costly when a mistake is preventable.

Wouldn’t it be wonderful if you could reduce avoidable errors at little or no cost? My experience tells me that many business owners, executives and managers could do just that if only they were more aware of personal tendencies that influence their decisions as well as vulnerabilities we all have that stem from the way we (that is, our brains) perceive and analyze situations and information. Cultivating this self-awareness is one of the lowest cost — but most challenging — ways I know to become a more effective decision-maker.

Perception and perspective are tricky things. Optical illusions exploit the way our brains work, causing us to misperceive objects and images. We often consider these to be tricks that aren’t very important to daily life, yet there is at least one major exception: the passenger side mirrors on our automobiles, which come with an engraved warning reminding us that “Objects in the mirror are closer than they appear.” In addition, to use this mirror effectively a driver must be aware of the blind spot. Both the blind spot and misperceiving distance are problems because (when we are in the driver’s seat) our brains are quick to misinterpret the image in the mirror as physical reality.

In similar ways, business decisions are vulnerable to misperceptions or skewed perspectives. Vulnerabilities generally fall into two categories: those everyone shares as part of the human condition and those that are particular to an individual. As with the side mirror, being aware is a critical first step to minimizing their impact.

No one is perfect; individual inclinations and gaps sway all of us. The ability to be self-critical is key. Here are some questions intended to provoke useful self-examination:

  • Do you tend to be overly optimistic or pessimistic based on recent experience?
  • Do you defer to experts or discount their opinions completely?
  • Do you balance intuition and evidence or automatically favor one over the other?
  • Do you probe for information and knowledge or make do with whatever is available?
  • Do you actively seek alternative views or protect yourself from being challenged?
  • Do you tend to make decisions too early or delay until the situation is critical?
  • Do you fear scrutiny or embrace it?
  • Do you change your mind too easily in the face of new information or resist too much?

Individual inclinations and tendencies can and do negatively impact decision-making.  None of us can escape entirely but self-awareness can help balance and counterbalance our weaknesses while making the most of our strengths.

It is also important to factor in biases and blind spots that researchers have identified as hardwired into each of us. Though hard to counteract, there are steps that can help to manage these human factors. Robert Wolf provides an excellent starting point in his post on “How to Minimize Your Biases When Making Decisions” for the HBR Blog Network. In my consulting practice I have seen these biases reinforced or mitigated by an individual’s personality and decision-making patterns; so be mindful of their interplay.

Another human factor to consider is willful blindness. This phenomenon is not confined to business decisions but can have a devastating effect on an organization in which it occurs. Especially insidious is that blind spots render issues that require attention or decisions invisible until they become crises, sometimes presenting an existential threat to the organization or inflicting terrible harm on others. To learn more, listen to Margaret Heffernan’s TED talk on the topic or read her article on “Willful blindness: When a leader turns a blind eye” in the Ivey Business Journal online.

While the focus of this post is on individual decision makers, it applies to teams as well. Startup ventures, intrapreneurial teams, and top management at organizations (large and small) are all susceptible. As with individuals, teams have their own vulnerabilities. Teams that are comfortable with internal conflict and seek information from divergent sources may be less susceptible to willful blindness but may have difficulty absorbing the final decision when it’s time to do so. Alternatively, the danger of willful blindness or confirmation bias may increase when team members are discouraged or punished for raising important concerns or contributing information.

SWOT spotHas this post convinced you that you can become a more effective decision maker? If so, use the information here to assess your own decision-making habit and patterns. Ask people you trust to level with you about your strengths and weaknesses. When you spot an opportunity to improve yourself or your team(s), remember that change is difficult and requires persistence. Progress takes time and set backs will occur. Keep at it; there is a lot to gain.

© Copyright 2013 Karen Utgoff. All rights reserved.

From New Employee to Productive Colleague

By Laurie Breitner

09-01-13 image for LCB postAs I write this I’m watching a parade of  students being introduced to their new environment. Colleges and universities have a lot of practice doing this; each fall they handle an influx of new students, make them welcome and integrate them into an existing culture — that is, they lay the foundation for students’ success in college and beyond. Few businesses do that so routinely. Should your business take a page from their playbook and put in place practices to orient and engage new employees? This HBR post by John Baldoni speaks to the many possible payoffs for companies with more engaged employees.

While each workplace is unique, here are a few essentials to consider when putting together your employee orientation program.

1) Overview – Incoming employees who understand your organization and how their new role fits in it will be better able to contribute. In addition to one-on-ones with supervisors and human resource staff, provide information about your company’s “big picture” — ideally in an online repository that can be kept current. Include your mission, vision, and annual company-wide and department goals and, of course, how they are measured. Each employee should be given an up-to-date job description for their role (and, ideally, everyone else’s), an employee handbook, and be informed about your performance evaluation process including any probationary period. Other helpful information is your company organization chart, and background material that describe your company’s products and services, target market(s) and, if appropriate, major customers and influencers.

2) The basics – At minimum everyone should have access to your company directory with telephone numbers, email addresses and office locations. Is there a calendar of planned meetings, social events and holidays? Do most departments have set periodic meetings, and if so, who leads them, creates agendas and where are they held? Include information about how people typically dress and details of what you mean by, for example, “business casual.” Consider using candid photos of current employees (with names beneath) so people can start putting names with faces and see examples of how people dress. Long before Facebook (the company), schools routinely created a school face book of all students including names, what they like to be called (e.g., he prefers James, never Jim or Jimmy), their dorm and interests. Could something like that work at your business?

And, there are practical matters. Who buys/makes the coffee? Do employees take turns on KP (kitchen patrol) or is that duty assigned to a particular employee or cleaning service? Is the refrigerator emptied every Friday of all but marked items? What do new employees need to feel a valued part of your organization?

3) Resources – There’s a lot to find out. Do you have a company intranet or other data repositories? New employees will feel more welcomed and become productive more quickly if you save them the trouble of having to hunt for routine information such as reserving conference rooms, the location of the supply closet, and office kitchen. Outside-the-office information such as area restaurants (menus and how to get there) or places to exercise and shop are helpful.

4) Mentor – Even with all this, newbies may have questions or concerns they feel uncomfortable raising with a superior or co-worker. Or, they might need guidance on company culture. If you have more than a handful of employees, consider pairing each new employee with a seasoned worker, ideally not a boss. Clearly the mentor must have the right interpersonal skills, volunteer, and enjoy the responsibility. Surveys consistently report that a top reason people give for being happy at work is whether they have a friend, e.g., feel personally connected. I am amazed at how long some of these relationships persist. In the late nineties I paired a new employee (from India, as it happened) with a willing mentor. They are still friends almost 20 years later.

What specific challenges will employees face in your organization? To get in touch with what new employees need, think back to jobs you have had and your first day or first week; involve current employees in putting information together. Given the expense of recruiting and hiring, it makes sense to invest a little more to give your new hires a good foundation for their — and by extension, your company’s  — success.

© Copyright 2013 Laurie Breitner. All rights reserved.

To Tell or Not to Tell?

By Laurie Breitner

Your healthcare practice is doing well. After some tough beginning years you’ve added partners and pulled away from the pack by learning not only how to survive — but better yet — how to thrive in a changing regulatory climate.

You and your partners feel it’s time to expand geographically. You found a practice in a nearby town that seems to present an opportunity. Despite their large patient base, they aren’t doing as well as they might financially and the senior partners are ready to retire. A deal is struck and a take over date picked — three months hence. You plan to keep the current support staff and remaining clinicians at the current location, and expect to retain the bulk of the patients, reasoning the key to that is staff retention.

Only your partners and a couple senior staff are included in transition planning. No else one in your current operation and no one at all in the “new” practice is informed, which raises the question: when do we let everyone else know?

A couple of your partners argue for immediate and full disclosure. Get everyone together, share the good news — because it really is good news — and get them involved in the transition.  They feel some staff might leave, but overall, there would be better buy-in.

Others are concerned about staff in the acquired practice seeking employment elsewhere over the course of the next three months. Who would want to stay on knowing that they would have to cope with a transition? Better to tell them the day the transition is effective. There might be some initial discontent, but if they were told on Monday morning, they’d have to pull together to serve the patients scheduled to arrive.

There is no consensus. You’re the one who started this practice. All eyes are on you. What do you say?

First take a deep breath. Ask yourself, what are you trying to accomplish?

This is a long-term play and in the long run you want a larger, financially viable practice. You know that while patients are often loyal to their doctors, it’s the staff that keeps the business on track. Schedulers, billing staff, nurses, and technicians support you and your partners. Can you really afford to keep them in the dark? Is that a way to start a new relationship? How would you feel if the roles were reversed?

Is there another way? You have an opportunity to build a good long-term relationship with the new team, which should minimize possible turnover in your current operation and in the one you’re acquiring. A little selling is involved. So, get the group together and tell them the good news. Plan to have one-on-ones with (at a minimum) key staff — ideally everyone — to answer their questions, make new staff feel welcome, and current staff feel appreciated. Hear, and if possible use, their ideas for the transition. Listen to those who mourn the loss of what was; those feelings will pass more quickly if they are acknowledged. Let everyone know how much you respect and appreciate them. Encourage them to be part of the future you envision.

Remind yourself and others that this good thing for both practices. There will be more opportunity for staff advancement, better job security, and additional coverage. Patients will have more choices of locations and practitioners and perhaps even longer office hours — one office could cover early hours and the other late; there would be many possibilities with a bigger practice.

Keep everyone informed of progress or even lack thereof. Email or written updates posted where everyone will see the latest news will suffice between formal meetings. Show your appreciation for all the hard work and acknowledge the extra work that your current and new staff does to make the transition go smoothly. Consider some kind of celebration to start building those critical relationships between people.

Wouldn’t it feel better to start off this new chapter with honest communication as a foundation for future employee-employer relationships? Once past this hurdle, you can turn to the question of how best to inform future patients and others in your new community.

© Copyright 2013 Laurie Breitner. All rights reserved.

What’s your SWOT Spot?

By Laurie Breitner

In real estate the old saw is that the three most important things are location, location, location. In business — especially a small business — it’s focus, focus, focus. My colleague Karen Utgoff and I have been encouraging business owners to think this way for years, each from our own perspective.

Karen is a market strategist and often looks at businesses through that lens. That is, what are the opportunities and threats that could impact a business? As an operations person, I have a different viewpoint. I consider a business’ strengths and weaknesses. Of course each of us does that within the context of the business’ specific mission and target market. When we work together, we joke that I handle the S-W while she deals with the O-T. It’s our effort to bring a little humor to the topic and it usually gets a laugh.SWOT spot

So, expect to read about ways to determine and operate within your organizations’ SWOT spot — the place in your market where you can take advantage opportunities, mitigate threats, utilize your strengths and minimize your weaknesses.

 

© Copyright 2013 Laurie Breitner. All rights reserved.

Minding the Gaps

By Karen Utgoff

There are many definitions of entrepreneurship. This one is my favorite because it is confirmed completely by my experience:

“Entrepreneurship is the process by which individuals — either on their own or inside organizations — pursue opportunities without regard to resources they currently control” (Stevenson, Roberts, and Grousbeck, 1989)

When a business is in a stable phase of its life cycle, management seeks to optimize expected results within the resources available. In contrast, entrepreneurs, as well as company-based intrapreneurs, seek to overcome or work around gaps in resources, customers, and knowledge to get something new off the ground.

As an operations person, Laurie is especially aware of gaps that could interfere with making the important transition from the entrepreneurial (startup or significant growth mode) to a more stable phase. Putting systems in place to attract, retain and manage employees that consistently and efficiently produce quality goods and services is key.

From a market-oriented business strategy perspective, I’m concerned with gaps in the business model, resources, and reputation that interfere with the ability to start up and grow (new or existing opportunities). A sound approach to developing well-aligned value propositions, competitive differentiators, product/market fit, and marketing/sales tools is key.Gap Files 2

So, expect to read more in The Gap Files about how entrepreneurs leading startup companies or innovation-driven growth initiatives within existing organizations can overcome obstacles, find help, and make do in the face of scarce or nonexistent resources.

© Copyright 2013 Karen Utgoff. All rights reserved.