Strategic Planning

Nail Down Your Business Plan And Elevator Pitch Now!

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Business plans and crafting pitches are a few of my favorite things to talk about. When executed well they are tools that can really support you as you’re working to grow your business. Your plan acts as a bit of a roadmap and your pitch, how you’re getting down the road. I also really like to talk about them because they’re so amorphic. Depending on who you’re presenting to, the presentation style, organization of information, and even some of the business details can change dramatically. 

I know, I’m weird because I think all that uncertainty is really fun. You, dear business builder, shouldn’t be scared though. Because at the end of the day the least common denominator of every business plan is just answering the “how” and “what” questions in your business and your pitch answers the “why”. Here’s an analogy I like to use - your business is like an arcade machine. In the sea of classic arcade games, skee ball lanes, and pinball machines your job is to be entertaining enough to get someone to wander over to you and then engaging enough for you to get them to put their quarters in. Then, once they pay all you have to do is deliver on the experience you promised. 

That’s it! 

So in this post, I’m going to give you two quick frameworks. One to help you nail down a simple business plan and the second framework is a crash course in perfecting your pitch. 

Let’s get into the business planning. 

Now, this framework is designed to help you rough sketch your business plan. Knowing that different audiences will need to see different things in different formats means you’ll need a foundation to draw from. That’s where my 5 Minute Business Plan comes in. It’s designed to help you get refocused on the days that have you wondering if what you are doing actually matters. (You don’t even have to be an entrepreneur to understand that feeling.) Forcing yourself to do something like this every once and a while helps to keep you connected to what you are doing - more than just reading your mission statement over again. It can also help to reveal any changes in how you feel about what you’re doing or if the needs of your market have changed since you’ve started. This can lead to a pivot in your service/product outcome and can keep you relevant. 

This business plan is only five questions long and ideally should have you only thinking about a minute or two for each question. You aren’t trying to create some be-all-end-all plan you are connecting to how what you are doing now matters. My advice is to just copy and paste these questions and then do some free writing for the answers. After you are done you can take those answers and match them against your current list of business activities or mission that you have. If the new answers are different from what you’ve been doing, you know that you have some more exploring to do. 

1. Who are you, what’s your story, and why should I be interested in what you are doing? (Think Mission and Values.)

2. What is the problem you are solving? What are the real pain points for people you are addressing? How is your solution better than your competitors? (Do you know if competitors actually exist?) 

3. What is your solution? How do you bring that solution to the market? What are your factors of production and distribution? How are you organized or structured? 

4. How are you financed? Where do your sales come from? What do your cash flows look like? Are you P/L profitable but don’t have enough cash to pay fixed expenses - if so why? Is your margin high enough to cover expenses? What is your burnout rate? 

5. How are you attracting people to you? How are they hearing about who you are and what you do? Where does your engagement come from? What is your platform or Do you have a platform? Are you tracking your marketing efforts for efficiency?  

If you find your answers changing over time that’s ok - just make sure you are monitoring those changes. Changes that foster an environment for growth are great! I think it’s really important to write these out every once and awhile. Thinking about them is good but you won’t be able to track how your thoughts about your business change because our thoughts are always so fluid. Plus, it’s good to have a standard foundation to build future plans from. Also, in terms of economic players, people, in general, are amazing at rationalizing and you won’t be able to get any real information from the stories you tell yourself on a daily basis about your business. 

One down. One to go. 

Now we’re getting into the pitch framework. 

First I wanted to talk briefly about how important your 90 Second Elevator Pitch is for everyday life. This is not just a skill to have refined but a resource you should have at the ready and it won’t matter where you are: networking events, social events, family events or even professional events. Whenever you meet someone new one of the questions you are probably always going to get asked is “What do you do?” Are you prepared for that answer? As a business builder, how are you going to possibly create enough impact with that person that they might actually want to continue to engage with you? Which can include buying from you, collaborating with you, or referring to you? 

The web and social media make great support tools but you have to be able to confidently convey your mission, values, and efficacy face to face at some point in the transaction - or at least face to video screen. So here is a framework to ensure that your elevator pitch is effective, entertaining, and ideally profitable. 

1. Practice. Developing a pitch takes work.

There is no getting around that. You may know how great you or your products are but you need to be able to tell other people that in a succinct way. Rehearsals, rewrites, and even peer reviews are a great way to sharpen your pitch. Remember most of the time you are going to be talking to your stakeholders and not banks or venture capitalists. So make sure the language you choose is appropriate for the right audience. You should definitely have a few versions so that you can always land right where your listeners are. Practice also means you will have a basic core of information that you know you are constantly giving out each time you present. This makes it easier for people to remember, refer, and talk about you later because it’s the same type of story each time. 

2. Identify the pain points your product or services addresses early on.

Odds are your audience won’t have a lot of time or even interest if you start droning on about how special or unique your process is - worse off how great it will be for them if they try it. So avoid that by asking about an experience that anyone can relate to, the more uncomfortable and universal the better. Don’t be afraid to ask a few well-prepared questions to get a handle on your current landscape. You can get creative here as long as you tie it back to how what you do addresses either the feelings of a situation you described or the problem itself. 

3. Identify what makes you unique (read: better than the rest) and positioned as the best solution to those pain points in the second tip.

This will also give you the opportunity to expand on the needs you satisfy in your market as well as the scale of that market. You should also be mentioning the types of clients/customers you serve as well as how you bring your solution to market. You have to remember though this pitch isn’t really about you. It’s about getting those around you invested in what you do - dropping emotional and even rational anchors on those listening in. 

4. Really avoid filler, buzzwords, and truisms.

Truisms happen when you get too invested and believe your own marketing and hype. That might work for you but your listener might not consider those things entirely true at all or even share the same point of view - think about the last time you heard a financial advisor speak about something with absolute certainty...Yeah, odds are those were personalized truisms based on some nugget of information that might have been factual at the start but by the time you hear the pitch that information was mutilated and has been taken astray. As for filler and buzzwords, they are never good. You want to craft your pitch as though you were talking to a 6-year-old. Not because people aren’t smart but because you want to make sure that all of your audience understands you and what you do. All that extra stuff carries a chance of making people feel left out and distracting from your actual message. 

5. Calls to action are great and hard unreasonable closes are the opposite of great.

When deciding what your calls to action are going to be you really have to think about your goals. Are you looking for referrals, for someone not to throw away your business card, or just information and an introduction? All those things mean you have to build trust in a very short amount of time. Unless you are on the TV show Shark Tank you probably won’t be asking for an instantly massive hard close or sale. Remember you are talking to people and they are the ones who will ultimately decide whether you have proven yourself enough to be engaged with. Be very careful with how you ask someone to take action. If you say you are going to follow up, you better follow up! 

There you have it. 

I know that this post was a bit long and dense but it had to be done. These two concepts are really two sides of the same business development coin. You can’t sell if you aren’t really connected to what you do. My challenge to you is to try to use each of these frameworks earnestly and trust that process will make you a more focused business builder on the other side. 
 

Make Better Business Decisions

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Have you been decisive lately?

It may have been a while since you hung your business shingle and opened up shop. Or, you may still be working on hanging that shingle for the first time. Regardless of where you are today on your entrepreneurial journey, there is one thing that's consistent - you have to make choices.

Every. Single. Day. 

Every minute of every day you are making decisions. I mean, you decided that the link to this post/blog title was worth a look. When you did that you made an instant choice. You made a choice that meant you’d be giving up your time, and the opportunity cost that goes with this time, to get a little more insight on making decisions.

(This is very meta.)

I think it was a good choice and I hope you will by the end of this post too. 

When you decide to allocate something as simple as a few moments it might not feel like a significant trade but trust me, it matters. You are, whether consciously or not, acknowledging that you are willing and able to give up that time in exchange for some kind of value. In economics classes all around the world, this phenomenon is explained as the elasticity of demand. In literal fractions of a second, you measured the possible benefit of the insight of this post against a slew of criteria in which the aggregate of totals who you are as a person. 

What you do with your time you do with every other resource. Crazy, I know and it gets better.  

In the early stages of building a business, it feels like you have to make a lot of hard and fast choices. There are tradeoffs punching you in the face from every direction. Things like how you set your prices and deciding on the business activities that will make up what you do from day to day. You're putting the foundation in place so that people can find you, learn about you, like you and decide that your offer is worth their dollars.

It can feel like a lot all at once and it can be exhausting. So, how do you develop the stamina to make good decisions on the regular? 

Let's start by working through the biggest decision-making hurdles. The first trap I see most often is entrepreneurs holding on the freedom to make choices which really means overcoming the "maybes". 

Hoarding your freedom to make choices is a terrible thing.  Being an opportunity miser is actually keeping you from making any real progress. You are constantly burying yourself in the super extremes of opportunity costs and for good reason, so you think. Resources are scarce even for businesses that seem to be thriving, that’s always a barrier you will bump up against. Making bad decisions and hoarding freedom of choice can actually do more damage to your business than making decently-informed-probably-not-perfect choices. Why, because you're missing out on opportunities! If you don't invest your time, money or emotional energy you'll never take any action and you won't make any progress. 

These next few are smaller but worth acknowledging. These are the fallacies that will eat up lots of time, energy, and produce more stress than your body should probably be handling. 

Fallacy busting.

First is the Information Mud Pit. Feeling like you need as much information as possible from as many different experts, gurus and websites is like having your car stuck in the mud while you just hammer the accelerator. Sure it’s going to make lots of noise, throw lots of dirt around, and maybe even start to give you some forward motion but eventually, you are just going to overheat your engine, breakdown and still be stuck.

Don’t let your brain throttle about in the mud and then break down. All those expert sources are just people and they may not be in exactly your situation. Do those people have the same values, personal/professional experiences, or even biases that you do? Work on gathering enough information to cover any of the possible outcomes you can predict (there will be some you won’t be able to predict) and move from there. Just like getting out of the mud in your car it’s going to take a little patience, finesse, and the right tools. Not all the tools ever made – the same goes for research.

Next is being too busy. Everyone is busy so that excuse can’t cut it anymore. What you are doing is finding new and different (read: easier) things to deal with that can give you some satisfaction from safe handling the things on your to-do list that can be completed with the least amount of energy and work. The other part of the being too busy is trying to multi-task a little too much. When your attention is always diverted in lots of different directions the choices you make tend to be less informed, less qualified, less efficient, and just chock-full-of-mediocre. So no more excuses as they will just keep stressing you out as your list of decisions won’t be getting smaller.

The last fallacy I want to kick in the face is that you can’t get what needs to be done because there are always little fires that need your immediate attention. The problem isn’t that you are constantly in a flurry of micro-emergencies, it’s that you have failed to set your priorities. Decision making effectively takes a little work and a little prep time. It’s in the prep time that you should be stripping out your decisions and reorganizing them in a way that reflects their relative importance. I think there is a lot of importance in building momentum in getting things done but you shouldn’t front load your decisions will all the easy stuff. You won’t be taking advantage of the momentum and flexing your decision-making muscles the best way unless you prioritize.

Now that we busted a few fallacies let’s get to some action steps help make you a lean, mean decision making machine.

1. Are you actually making the decision? Sounds like a silly question to ask but it’s important to think about who really has the final say. If you are a solopreneur it may very well be you. But are you part of a team or have a partner you have to run this by? Decide who is going to be making that decision and then move forward with purpose.

2. Set the stage. Very few decisions we make will only affect us. So it’s important to consider how your decision is going to affect the rest of your business and stakeholders. Make sure that everyone is comfortable with what’s going on and understands at least a few of the major consequences of those choices.

3. Make every decision (even the tiny ones) part of the big picture. Remember when you started your business you put a whole bunch of time and effort into your values and mission. Yeah, those still exist. So make sure that your decisions are in line with what you want your business to continue to be and to be perceived being. Everything from color pallets, paper supplies, and even how you package your product will all impact how your brand is perceived.

4. Do your research. At this point I would like to direct your attention up a few paragraphs to part about hiding behind information.  You want to make sure that when you are making your considerations you are using good information – good in, hopefully good out. Keep your information lean and relevant. What that means for you is that you do not necessarily need to be an expert on how paper products are manufactured and distributed to pick a new coffee cup vendor.

5. Consider solutions, side effects and possibilities. You want to make sure you try to anticipate as many possible outcomes as possible. Not all your decisions are going to be of Earth-shattering magnitude but it’s important to be aware of how your decisions will interact with the rest of what your business and environment have going on. Your goal should be to get the most out of whatever your resources are all the time. That and making sure all the different departments continue to play nice together to make your business be the best it can.

Before we finish this post I wanted to cover one more thing.

It’s a concept that goes hand in hand with making decisions and that is managing integrity. Your businesses integrity is more than just making sure that all your decisions are in line with your business mission. It’s about allowing your customers and stakeholders to trust your business. It’s trust in you and your brand that will keep your customers coming back. You get to be a trusted resource by continuing to make decisions (for your offerings and how you manage your business) that continue to improve the experience for the customer and client. That includes how you manage your finances, how you handle bad customer experiences, and even how you choose to interact with your community.

Integrity Pro Tips:

1. Always do your best to meet your commitments – saying no sometimes is ok.

2. Treat everyone with respect that includes your competitors and even naysayers.

3. Always be honest. If a delivery is late, you’ve made an error, or shipped the wrong product out - your customers will always appreciate you being open and upfront. Their compassion and respect for you because of that honesty might actually surprise you.

Make The Most Out Of Your Business Planning This Year

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To quote a song that will hopefully be an earworm for you, “Every new beginning comes from some other beginning's end.” This song has been my jam as we enter into the second week of 2018. 

Why?

Because it’s, “Time for you [and your business to finally] to go out go out into the world.” 

Ok, sorry. 

I’m done with the lyrics. 

But the song applies to the post I promise. 

In order to talk about accountability and growth in a non-cheesy and meaningful way it means you have to accept that some things will have to change and what better to serve as a natural inflection point than the New Year. I want to help you kick start your accountability, business planning and goal setting from a slightly different perspective. To do that I’ve prepared a few things I want you to consider as you’re finding your stride in 2018. 

Here are five things that I would offer anyone looking to start the year off right. 

1. Inventory everything. 

Now I’m not saying that you need to painstakingly document every pen and paper clip but for the love of Mike, please have an idea of what you need to do/have to bring your product or idea to fruition. If you want to start a gym then have an idea of what the minimum amount of equipment you’ll need to open your doors. Have a business that sells a physical product - make sure you have some in stock before you start advertising them. Have a restaurant then make sure you have the ingredients to provide what you have listed on your menu. Everyone is always busy and even more so this time of year so ensure your customers stay happy by making sure you have what they expect you to have when they are ready to engage with you. 

2. Cash Flow. 

Ever been on a cruise ship? Well they know exactly what they need as cash inflows from each passenger on the cruise to make it a profitable one. They have inventory and supply chain procedures that would give Wal-Mart a run for their money. Understanding your cash outs and ins is something that small businesses don’t pay enough attention too. Most of the time, in my experience, they just pay the bills as they come in and deposit the revenues for the day. That’s all well and good but what kind of analysis are you doing so that you can keep steering your business in the right direction. Just because you’ve managed to keep your doors open (physical or digital) doesn’t mean that you are successful. It just means you’ve been paying your bills on time. Plus how do you know what’s working and what’s not if you aren’t keeping score on how efficiently you are allocating your resources. 

3. Time Management. 

How do you keep track of your hours in the day? I’m not just talking about the billable time or the time that you play shopkeep. I’m talking about all the rest of the work that needs to be done. Are you making time for the administrative tasks appropriately or are you just throwing everything into an office and hoping that as more time passes things will just work themselves out. Time is just like money - it’s a scarce resource. You want to make sure you are doing something to so that you are maximizing the time you choose to be working. Remember just because you throw hours at a project doesn’t mean it’s going to be good - I’d take deliberate and focused time over brute strength over-work any day of the week. Extra point: make sure you make the most out of your sleep time. I’ve just started tracking my sleep habits and I’m already impressed by how little changes can make me feel amazing the following day. 

4. Don’t stop learning. 

There is always better ways to do stuff. There are always new tactics and lessons to be learned. So make sure you allocate some of that scarce resource, that is your time, to developing your skills. Personally I’ve been working on my Photoshop skills and I’m having a blast doing it. I will probably never dawn the title of graphic designer but understanding Photoshop will help me deliver better products more efficiently to my clients. This could apply to leadership, being an entrepreneur, a language, and even managing Quickbooks. (I would definitely recommend Freshbooks though if you are looking for a finance manager.) 

5. Stop saying and just do. (Just in case you need a little more support.)

In the last 2 weeks I’ve seen a plethora of articles and posts all about getting you to achieve your goals. Everything from journaling to sharing your goals on social media to create some accountability. While those tips are great they aren’t going to do what needs to be done to get your goals accomplished - you are!! Why would I tweet something if my audience can’t really hold me accountable? Facebook statuses fly by with the speed and fury of a passing fighter jet and most people are just creeping their friends or friend’s photo’s - is that really a place to tell the world you are ready to take your business to the next level? I’m guilty of this too. I download productivity habit tracking apps, I journal for revenue growth, and I’ve even told my friends and family of new happenings. Sometimes those things don’t happen and it’s because I (and you) are great rationalizing machines especially when something feels or seems like it will be work. To get past that you have to start and keep yourself on an action train. Start doing and then keep doing - it’s the only way you will get things done. The GTD is an example of a method that is really great for helping you strategize but don’t get too preoccupied in the planning. Sometimes “good enough” is what you need to get on to the next task. 

I hope this list helps. I know they all aren’t necessarily connected but each of them is important if you want to get your business or life moving in a positive direction. Especially number five. So to recap: take stock of your stuff and money, keep learning to keep yourself as efficient as possible, do work, and limit how long you spend playing in online scavenger hunts for a few laughs. 

Like I said, I’m a people too, and I get a little lost and depressed sometimes too. Over the last week or so - I’ve been making a conscious effort to shake that and put my own advice into play. I don’t like complacency and I’m leaving it behind. Feel free to join me! 

Want to get ahead in 2018? Understand these Five Forces!

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I read an article that took me back to my undergraduate economic/business studies at Bentley University (College when I was there). 

Well took me back to the feelings I had as an undergraduate. 

Allow me to take you back. 

Take you back 10+ years ago to young me sitting in my first Microeconomics class - a class that would yield my lowest grade in my academic career to date might I add. What I remember most about this course were the conversations and the breakdowns between what the book said and how we could apply in real life. I loved this course but I seriously struggled, so much so that the professor actually said I should consider a major change. 

But I stuck with it. I knew, even though I didn’t always get the material at the time, that it was important to know about the incentives that motivated how firms interact with each other and how people interact with firms. Fast forward to now and I’m teaching college courses, mostly economics and finance, including designing original economics courses for business programs. Take that Freshman-Bentley-Econ-Professor-Who-Didn’t-Believe-In-Me! It’s being pragmatic in understanding what motivates people and making everyday economics a skill set that I rely on everyday. Getting to the heart of causality and creating strategies that have real impacts for people and firms. 

Why did I share that with you?!

It’s because of Michael Porter. This article reaffirmed the mission that I have for myself and for Disruptive Strategy. Basically when I grow up (professionally) I want to be in a similar position to him. Porter is a strategist, economist, and professor that has done an amazing amount of work touting the benefits of competitive systems to get and keep economies moving and growing.

Reading this article made me feel like that undergraduate that had a world of possibilities in front of them. It helped me remember that the skills and the tools that I’ve been sharpening over the last decade not only have value but are needed by people and firms because it’s more than what simple Google searches and templates can provide. 

One of my favorite systems of his is the Porter 5 Forces Model and I wanted to share it with you. Since its inception strategic consultants, planners, and advisors have been using this system as a basis to create strategy for firms of all sizes. The kicker is that it’s based in pretty topical economic theory - remember the things that “shift” a supply and demand curve, or how markets find equilibrium, or better still price elasticity of demand?? 

Yup, it all comes from there!

Here’s what you need to know about the 5 Forces Model to be a better strategist: 

There are 5 Forces that drive companies in competitive markets: 

- The threat of available substitutes
- Amount of buyers and their bargaining power
- Amount of sellers and their bargaining power
- Rivalry/competition within a market - number of existing players
- Barriers to enter a market

Substitutes 

When bringing a product or service to market you have to consider the available substitutes. How much do they cost? How close is the experience to your product or service? What might differentiate you or how can you increase your value/perceived value? There are lots of tablets out on the market now but, why do people choose to buy an iPad? Why might someone choose Google’s Nexus 7? How can you position yourself to be perceived as a niche product or service?

Buyers

Can the buyers work together to have an affect on a market? What kind of information are you providing for your buyers? What is the collective experience of your consumer? Do you have a product or service that allows for multiple points of entry at differing price levels? Is the experience so streamlined that consumers can always expect a certain experience? Are you building stakeholders or are just banking on perceived obsolescence? Think your cable company. Odds are if you call complain and leave their prices won’t need to change because there are more than enough subscribers willing and able to pay the prices that they ask for. But, if you everyone in your town/city cut the cord and subscribed to Hulu and Netflix then the cable company might have to listen to the concerns of the consumer. 

Sellers 

Can you benefit from pitting sellers/vendors/distributors against each other for your business? Can you diversify the way you collect your inputs? Are there any suppliers that would help you grow your economies of scale - reducing your average costs over the long term. When you enter a market or are thinking about making your product unique it’s crucial to consider your supply chain. If there are any hiccups or if you choose cheap over value then that might have an effect on the quality or consistency of your own products. 

Rivalries between existing firms 

It’s important to assess where other firms are in your market. What kind of market is it? There will be big differences between how you approach an oligopolistic market vs something where there is a bit more competition. It’s also important to monitor how the market behaves. What I mean by that is keeping track of how things are marketed or how fast products/services change. An example would be Apple’s iPads and iPhones. It used to be that those were launched about annually but because technology is changing so fast it’s moved up to about a 10 month release time for new stuff or at least updates to existing stuff. When doing your branding or positioning seeing what the currents are doing will help you better utilize whatever resources you have available. Nothing worse than marketing in a place where no one is looking. So identify your markets and who consumers as well as firms identify themselves. 

Barriers to entry

What will it take to enter a market or just start a business? What are the costs or investment necessary to be a competitor? Are there any obstacles as far as availability of resources to get you going? What are tax liabilities or government policies that need to be taken into consideration? Nothing worse than being in business for a while then getting slammed with a tax bill that you weren’t even close to being prepared for. Are there distribution channels available for what you are doing or do you have to create your own? You might be in business already and need some help gaining some scope on growing - so it’s important that you understand the questions to ask to get the best information to overcome barriers. 

I know went over these 5 Forces really fast and it’s a lot of questions to ask or even try to answer. There's a benefit though in even starting to think about this stuff. When you start to think about these forces and answers these questions some really neat stuff happens. You start to get really clear on what sets you apart in your market. You start to see what your (real) competitive landscape looks like and you start to see how you can continue to add value to people's lives. 

I just realized how long this post is going, so if you are still with me - you are awesome! Awesome and exactly the kind of person I want being part of this community. I want to do more on creating strategy and using the 5 Forces Model so if you have questions on application or making this more pragmatic please shoot them along by signing up for the Disruptive Strategy Newsletter!
 

How To Get Unstuck: Barriers To Entry Edition

Worried about the obstacles that you’re facing in your business? Odds are those obstacles are the result of not understanding the barriers to entry your business faces - even if you’ve been in business for while. 
 
“Barriers to entry” are way more than business buzzwords that fumble out of the mouths of people playing business. In fact the concept of “barriers to entry” is applicable to more than just starting a new business venture. The last time you probably heard that term was in an economics class in either high school/college or if you’ve talked to me long enough and have listened to my opinions about a few big public businesses. 
 
At the very least, that makes my competitive strategy heart sad.
 
No need to panic though because in this post we are going to talk about why it’s important to think about the barriers of entry and exit in your industry or business and how that can help give you a bit of an advantage. Competitive advantage is not static - you have to keep working at it! 
 
One more quick thing. To all the naysayers out there pining over why their businesses aren’t growing - the pie is not too small. There is enough marketshare to go around for everyone if what you’re offering is valuable! 
 
Especially, those that effectively differentiate, understand their barriers and pick the right niche. So before I start getting push-back on how strategy is just a mental exercise and that it takes big bucks to use strategy effectively just remember that if you can get your business to be laser focused, you’ll always find a rabid and engaged customers.
 
Ok prerequisite rant over.
 
So a barrier to entry is simply defined as a thing you need to do to get your business up and running. Barriers can also be reasons why customers aren’t buying from you. It can be an action, a purchase, government regulations or even experience needed to get you into an industry or to get customers to engage with you. Some industries are more capital intensive than others - think the capital requirements of a car manufacturing company versus the capital requirements of an english tutor. 
 
The other side of that pendulum are industries that require lots of experience or education. Think of the time and experience it takes to be a great doctor and attorney versus more entry level jobs.  Some firms attempt to capitalize on a specific barrier to control what firms can get into their market or industry. They may control the raw materials, contract with wholesalers or distributors, pay big lobbyist dollars to keep regulation in their favor or even control all the media outlets to keep you from advertising.
 
That doesn’t mean you shouldn’t compete especially if it’s what you are passionate about! You just have to figure out how you can differentiate and deliver on the things that make your product or service special.
 
Barriers to entry tend to me a muddled mess sometimes. Start-ups and veteran businesses can stretch themselves too thin when trying to figure out which ones are most mission critical to focus on or to try to create a competitive advantage. Here are a few I like to keep in mind, that are more focused on how you run your business, when I’m thinking about keeping a business competitive in terms of barriers.

  • Network Effects - Think about the communities your stakeholders have created in support of each other and your brand. This can be a huge intangible asset.
  • Proprietary Processes - This is your firm's secret sauce. Do you do something in such a special way that has your clients and customers resonating with not only the result but how you bring that result to them. I have a favorite coffee place and it’s not because the coffee is great but because the coffee servers are great to talk to.
  • Switching Costs -  Cell phone companies are amazing and notorious for this all at the same time. Locking customers into contracts creates a barrier for new entrants or at the very least creates a lag time before groups of potential clients or customers can be reached.

These absolutely apply to customer's willingness and ability to engage with you. Are you making it easy for them to buy from you? To connect with your story or brand? To understand why you are so valuable that they would be doing themselves a disservice by not using you? 
 
Barriers to exit are very similar to entry. Some firms might choose not to play in a certain industry because it would be to hard to exit quickly or smoothly. It can be a challenge to offload plant, capital or equipment when a business closes. Firms might have high financial obligations to their employees might be locked into contracts with their suppliers.
When you are thinking about working on your competitive strategy I wouldn’t sleep on barriers. Better yet I challenge you to take a shot at drilling down into the three that I listed. Can you figure out where your advantage can come from and how you can better differentiate yourself. The biggest takeaway is sorting through all the noise when people talk about barriers to entry. Spreading yourself too thin can tax your resources and your spirit.
 
I would love to hear how you are navigating your barriers to entry? Do you have any insights or questions? My goal is to keep the conversation going and to really get entrepreneurs more in tune with what’s going on around their businesses and not just what’s happening in them. 

Make The Second Half Of The Year Count!

Today I want to just jump right in and talk about the mid year review process. It’s the middle of June which makes it an excellent time to hit the pause button on your business activity to take a look at what’s going on inside your business. 
 
I want to talk about why that’s important and give a few tips and actions you can take and try out in your business. 
 
Let’s start not in the middle but at the beginning of the year. 
 
At the end of every year you hear all kinds of stuff about setting resolutions, getting your annual plans, budgets and setting your business strategy for the year. It’s all rally cries and 4 hour strategic planning retreat or exercises. 
 
That’s all good stuff because for a short time you are forcing yourself to get crystal clear about what you want and how you’re going to get it. At least in an idea generating-optimal resource allocation-best case scenario planning kind of way. 
 
But, unfortunately, like well intentioned weight loss resolutions, after a few weeks, most businesses fall off the resolution wagon. Falling off your over idealized business resolution bandwagon doesn’t have to be a bad thing though. 
 
See, strategy and plans need to be more fluid. The trap is that as soon as you get in the flow of doing your business there are lots of pressures that a business owner has to deal with, that maybe weren’t accounted for or aren’t included in any of that early planning. If you built a rigid plan with maybe a few unreasonable or unrealistic expectations, there’s a chance that you get a little discouraged and throw the strategic planning baby out with the bath water. 
 
That’s when most businesses chalk up that whole process as not being worth it and validate how they feel by claiming that quote, this stuff doesn’t work or all that advice sounds great for everyone else but not for MY business end quote. 
 
That makes my heart sad. 
 
All that resolution and early year planning work is important for a lot reasons. They are the same reasons why they are important in the middle of year as well. 
 
Reasons like: 
 
Taking stock of what you’ve accomplished to date and look for constructive feedback on areas where performance is lacking. 

Discovering and eliminating possible roadblocks that are keeping you from achieving your goals.

Adjusting goals because people's tastes and expectations can change over time.

Getting information from you clients or customers about their satisfaction.
 
Making sure in the course of doing business you’re honoring what’s important to you - those would be your mission and values.

And, last on my abbreviated list here is making sure that you’re getting the most out of your time, money, emotional energy, patience and the list can literally go on in terms of the resources your business needs to thrive. 
 
I think you get the point. What happens is during the year we get busy. Get busy trying to do all the important things that help keep the people that we serve happy and returning as customers. But that leaves room for unclear strategy to creep in. Unclear strategy and conflicting priorities reduce your business’ performance and profits. 
 
That’s no bueno. 
 
So here is a list of 3 actions you can take during your mid year review process to help get your business back on the tracks you laid back in January. 
 
Gather your data. Every business has data. It might be a little different but start gathering. Start putting together things like client/customer sales, how many times you engage with customers, how many times do you have to engage with a prospect before they make a decision, how are you measuring success with things like social media or other marketing channels, what are all the steps in your process from customer interest to close, how much time are you spending doing admin stuff, or networking?
 
I’m hoping you get the idea. Then once you have all that in front of you and in some kind of way that makes sense you can make your way through some of the bigger questions about your business. 
 
Start with the big questions like: 

Where are we?

What do we have to work with?
 
Where do we want to be?

How do we get there?
 
What you’re trying to suss out are the mechanics of your business. If this were that weight loss new years resolution review what you want is to see how your body is doing now compared to the beginning of the year and have you been doing what you said you were. Then whether you were or not take a look at what’s happening right now and try to work out how you can still get to success if you’re a little short or if you are blowing your fitness out of the water what’s the next set of goals you can work to. 
 
After the mechanics I want to get into the experiences. 
 
A very important part of the review process is getting clear on what you want the people who interact with you to experience. They can be the same or different for all the different kinds of people your business interacts with. Everyone you meet is not necessarily someone that will listen to your pitch and you have to be comfortable with that. At the same time though you want to make sure that whoever your audience happens to be at the moment when they walk away, you did your best to be authentic in terms of your mission and values. This is getting at the heart of what’s important to you. 
 
In terms of our weight loss goal again, it’s like if you were using one of the many MLM weight lossy kind of products and all you did was spam social media asking people to buy or plan some kind of party. If taking your fitness more seriously has transformed what you want to do to reflect helping other people embrace their fitness is spamming <insert mass marketing weight loss gimmick> really the best way to get that conversation going. Probably not and if you’re like me you’ve already muted a few friends that have done that. Sorry friends muted friends if you’re listening. 
 
This last piece is about digging deeper on the “How” question from the first part. What you need to wipe from vocabulary from this point are vague business success generalities like: Make more sales, get more customers, have more engagement, set more meetings, coach more clients, make more stuff. 
 
Get the idea? 
 
Move away from the generalities and start quantifying what success looks like. How many more sales do you want? How many more customers? What kind of engagement? How many more meetings? How many more coaching clients? How much more stuff are you making? 
 
Once you get specific you can start to break out your schedule and allocate the time or other resources you need to allocate to hit those goals. You should have an idea because you already did the work of pulling the data. It might be more than finding the groove in your schedule. WHen you are looking at your business, you need to get clear and incremental on the actions you need to take. 
 
I mean, if you were a client of mine and said ok my goal is to get 30 new customers this year I’d say great so what are the steps you think you need to take to get the next client? That’s how you start. If you make your way through enough next’s you’ll be able to make your process a little more streamlined every time and figure out the tricky little things that work and tease out the things that aren't working so well. 
 
That’s it! That’s your review process for the month of June. You didn’t have to start from scratch and hopefully you're just building on the momentum you’ve been growing from the start of the year. I hope that the reasons I’ve listed are compelling enough to help you work through the three steps of getting your data and answering the big q’s, then working on the experiences you want to create, and lastly getting granular on the work that needs to be done to finish the year successfully, however you define success. 
 
I’ve just finished this process for myself and realized that success for me has changed a bit and that’s not a bad thing. My personal review process has shown me how I can take what I’m working with and authentically use my strengths and resources to finish the year strong. 

Why Blue Oceans Matter In Your Business

Blue Ocean Strategy is one of the business buzzwordy concepts that’s actually worth knowing about if you’re trying to authentically bring your business into the world. Its a methodology and planning process that was penned and cultivated in a book, Blue Ocean Strategy, by a couple of strategists and professors from INSEAD (international business school) by the names of W.Chan Kim and Renee Mauborgne. They combed through mountains of strategic decisions made by firms over the last century and boiled them down into a strategic framework that you can use to help better position your business.

It’s an awesome idea and a great way to visualize how your business is making strategic decisions.

At the heart of it, Blue Ocean Strategy is all about finding the open and untapped waters of your market. You are literally looking for either new markets or under-served markets that you can pivot your business into and hopefully capture.

To quote one of my favorite authors and TED Talk speakers Malcolm Gladwell - you are giving your market some “extra chunky” (Here’s the TED Talk if you’re curious but make sure you come back!)

What this blog post is going to do is break out the major concepts of the Blue Ocean Strategy framework. This is not so much a review of the book but it will hopefully help you getting into a mindset that helps you find ways that you can differentiate and find a competitive space. That new mindset will give you the opportunity to offer a very specific and niche value.

The first big concept in Blue Ocean Strategy is working on Value Innovation. Value Innovation is not an easy thing to pull off as it’s simultaneously finding ways to offer more value while lower costs. One tools that you can use to help find your Value Innovation is something Blue Ocean Strategy calls the Eliminating-Reducing-Raising-Creating Grid. This grid is a tool to help you organize your business so that you can flush out where you can differentiate against other businesses in your industry. You are listing the factors in your business that follow the prompts in the grid and taking a strategic look at what’s happening outside of your business.

After you work on ways that you might be able to find your Value Innovations there is a four principle framework that will help streamline your strategy process. These principles will help you focus the factors you flushed out and really hone in on how you can position your business so that you are serving your own blue ocean.

1. Rethink your market boundaries.

Where can you create an uncontested (low competition) market? It’s not always easy to move away from trying to make your slice of the pie bigger and work on baking an entirely bigger pie. There’s no reason you can’t go out and redefine who your market is.

2. Think of the big picture.

Everything is variable in the long term so you need to think about what your business might look like a few years down the road. It will help in the planning process in the short term if you have an idea of the culture, processes, and value you want to offer in long term. Everyone wants profit so don’t just try to plan for that - this process will blow up in your face.

3. There’s always a little risk in this but you have to start thinking about offering value beyond what your customers think they need.

You are in business to provide a solution to a particular problem or set of problems. To find your blue ocean you have to try to get your finger on the pulse of the next set of needs your customers are going to have. How can you add value to what you are already doing so that your offerings are so full of value that you can’t possibly be substituted out.

4. Get your strategic sequence right.

This is not an overly complex sequence and it’s really powerful. It’s three big questions and if you are unsure or answer “no” to any of them you have to go back and rethink it through. The first is, are you offering the most value as possible, economists would call this utility? After that is the price you are asking aligned with your product or service for your market? Lastly, can you produce it at low enough costs to get to the profit goals you have set up for yourself and the business?

The last part of the Blue Ocean Strategy has to do with how you execute and implement. It relies on and utilizes tipping point point leadership and the development of fair processes. To boil those into the most actionable and digestible nuggets possible you should be thinking about how you can ignite the values and beliefs of your stakeholders and use passion to ultimately spread strategy. You get to leading with passion and conviction through trust. That’s where fair processes come in.

Fair processes happen when your stakeholders, employees, or partners trust that you will make the right decisions in terms of moving the business forward. What are the things that you can do to show the people that rely on you that you deserve their trust and have the compassion and drive to move your strategy forward.

Blue Ocean Strategy is a really robust framework and it would definitely take more than just one blog post to really do it justice. My hopes here were to present you with a different way to think about how you are bringing your strategy to life. How can you infuse a little Value Innovation, tipping point leadership, fair practice, and the four principles above into what you are doing everyday to push your business forward.

4 Strategy Mistakes To Avoid

We all make mistakes in our businesses - no surprise revelation bomb there.

Part of growing a business is constantly learning from past decisions. It’s about getting savvier about the information you collect so you can continue to serve your market well. Making mistakes in your business isn’t inherently bad though. It provides an opportunity to collect feedback, to adjust a product or service, or to get your business back in line with its values and mission.

Making mistakes gets to be bad for your business when they are constantly costing you dollars, goodwill and market share. Making lots of mistakes makes it harder for your customers to know, like, and trust the experience you are offering.

I can’t stop you from making mistakes in the future (I wish I could do that for me!) but, I can give you a little insight around the most common mistakes businesses make in terms of strategy. This post is going to walk you through some of the most common strategy mistakes and how to avoid them. My goal is to have you evaluate your entrepreneurial efforts and be able to actively recognize falling into any of these strategy blunders.

When you can see a strategy mistake coming you can work smarter to correct it and continue to move your business in the direction you want.

Common Strategy Mistakes

1. No strategy at all.

This is number 1 on the list for a reason. Having no strategy is the worst mistake you can make in your business.

Why?

No strategy means you are just arbitrarily making decisions about how you are bringing value to your customers and how you are deciding how to spend your time, money, or effort. It also means that you are only measuring broad business performance indicators like “sales” or “revenue”. Using those measure isn’t bad but when you aren’t measuring them for any part This is the same thing as hearing someone say that their strategy is, “to be the best”. It sends shivers down my spine.

When you have no strategy you allow your business to be subject to the ebbs and flows of every single consumer and you run the risk of wasting resources. How can you be competitive if you aren’t working on getting the most value out of your own time, money, or effort?

2. Getting your business or industry wrong.

As an entrepreneur you are probably really close to the work that you do. That’s awesome because that means you are committed to deliver as much value as possible! That makes defining the market you actually serve hard to identify - especially when every resource you read talks about the importance of identifying your perfect niche.

It’s important to take a step back and look at the market you serve in terms of the alternative choices your consumers have to engaging with your business. Here’s an example: if you are in the “paint and sip” business you aren’t just competing against other “paint and sip” businesses you are competing for all entertainment dollars. Consumers that spend $25 - $45 per ticket per person could also spend that money on: dinner and drinks, taking in a live show, going to an IMAX 3D movie, etc.

Being able to communicate your value and create strategies that will help you capture those entertainment dollars is what you should be focusing on - not what you think you direct competitor is doing (at least not all the time).

3. Are your strengths really your strengths.

Generally businesses fall into one of two buckets. They are either awesome at delivering the best experience possible for their customer or they are really great at delivering value as efficiently as possible. All businesses have to do a little bit of both but there are only so many resources that get to be divided up during the day.

You can’t focus all your effort on your customers and all your effort on being as efficient and as effective as possible. You can’t be all things to all stakeholders so you have to objectively evaluate your business and pick out your strongest capabilities. You can’t have competitive advantage if you are trying to be the best at everything all the time. Also if you still think, “trying to be the best” is strategy please go back and read the first point.

4. Listening to all your customers.

Feedback is an amazing tool for helping you and your business be as valuable as you possibly can. Making constant changes based on all the different feedback you are getting will wreak havoc on your business and on your strategy. Strategy, and your business, shouldn’t be about making everyone happy. Your business will find its best successes by choosing a very deliberate market to serve and then committing to serving that market well.

It’s really easy to get distracted when it comes to strategy because the allure of doing more to appeal to more with the hopes of earning more is a hard bias to shake. Lastly, if you are listening to every customer all the time how will you really be able to test anything in your business. It takes time to build interest and to get people to know, like and trust you.

Constantly changing parts of your business can send an inconsistent message to your customers - which does not bode well for building loyalty and advocacy.


Creating strategy and communicating it well throughout your business is hard enough already. Don’t make it harder by making these mistakes!

Your Strategy Is Not Your Mission Statement

Your strategy is not your business's mission and it’s not your values.

Those types of business development concepts help to shape business strategy but, they are not themselves your strategy. The choices you make around things like who your customers are and are not, that’s strategy. The markets you choose to participate in, that’s strategy. Lastly how you are going to provide so much value that you can’t be ignored, that’s strategy.

Strategy has to (at least in the beginning) be deliberate.

When there is a disconnect between your strategy and what’s going on in your market you end up with a growth problem. The growth problem is your inability to take the actions you need to take to go out and get the right kinds of customers for your business. You start chasing everyone in the hopes of improving top line revenue.

Yes, there is a wrong kind of customer.

As an entrepreneur you have to deliberately choose how you are going to try to get new customers, measure  your efforts as you attempt to land those customers and continue to develop how you communicate to your customers. If it feels like a lot it’s probably because your strategy and the behaviors/systems you have in place to grow your business are misaligned.

Let’s start aligning.

Growing your business in a way that supports your mission and vision is what, in my opinion, most independent businesses want. You want to feel good as you’re growing your business. You have to move beyond just looking for those good feelings and clearly identify:

1. The specific need you provide for.

2. The specific customer you provide for.

3. Communicated (sold) in a way that is most responsive to your specific customer.

4. Continue to learn and develop your skills as a business developer.

Notice that none of those points have anything to do with mission or vision. Your mission is why you are doing what you do as an entrepreneur. It’s your motivation. Your strategy and business development behaviors are your how. Both of those need to be on the same page to be most effective.

Think about any high end ultra-premium car. Do they try to sell to anyone who may be in the market for a car? No! They are trying to appeal to a very specific kind of buyer. Their strategy to do so is perfectly aligned with their sales behaviors. The result? A market that will healthily bear the sales of the Ferrari 488 GTB starting at $249,150.

Sounds simple when you read it, right?! At the core of aligning your strategy and your business growth is your behavior. Are the sales behaviors and sales tasks you create in your business reflective of your ideal customers and market? Or, are you just out there selling to anyone that is willing to listen or read?

Everyday you are going to run into changes in your customer’s tastes and expectations. Technology will change. Culture changes and markets evolve. Your sales and growth behaviors need to adapt with the changes that are happening around you. If you have a clear strategy that you revisit often it will be easier to keep the integrity of your mission or vision. You’ll be constantly working at it and responding to change almost as quickly as it happens.

This is my challenge to you as the year comes to an end.

Think about how you are currently trying to find growth for your business. Do your day to day sales activities align with your business’ strategy? If they don’t you should really spend some time to get clear on the value you offer and to whom you offer it. Then build your strategy and sales activities from there.

Simplify Your Mission To Create More Value

It’s the end of 2016. Regardless of the type of year you’ve had up (maybe more downs than ups) to this point, this time of year is always a good time to reconnect with why you’re doing what you’re doing. It’s a great time of year to simplify, plan and connect. That means it’s also a great time to work on your business’s mission.

The process of working on your mission is a process I’ve developed and also use quite a bit. I wanted to make sure that I was taking my own advice and that it made sense before I just started dropping what could be conceived as just trite generic business guru nonsense. Not giving you nonsense is really important to me because mission is one of the strategy concepts that gets lost in buzzwords, jargon, and empty language.

Your mission, your why, is supposed to be the guiding beacon for your business. How then can you run a sustainable business if what you say you do is very different from what you actually do?

You can’t.

In terms of thinking about 2017, it’s still early. Very early. This provides you with an opportunity to dig in a bit through the month or in some quiet thought whenever you happen upon this post. What you’re digging for is clarity for two of the simplest and most difficult questions about your business:

1. Who are you serving?

2. How are you serving your customer in a way that matters?

Easy right?!

Now comes the part where I challenge you. You’re going to see some bullet points that I believe are the most critical things you should be considering when you are (re)sculpting your mission and setting up your business for 2017. Remember, it’s your mission that will weigh in on every decision you make, every resource you allocate and how you serve everyone of your customers.

1. Who are you serving?

Get as specific as you can and try to make it about one person.

  • What are their experiences?
  • Where are they emotionally?
  • What kind of values to they have?
  • What are their demographics: age, professional level, marital status, etc.
  • What kind of social or cultural environments do they exist in?
  • What is important to them?
  • What are they afraid of or what’s frustrating them?
  • AVOID AT ALL COST PHRASES LIKE: “small business owners”, “stay at home moms”, “entrepreneurs”, “people looking for a restaurant”, “students”...You get the picture, right?

2. How are you serving them in a way that matters?

You created your business because you identified a problem and figured out a way to offer a solution. It gets easy to get bogged down by all the day-to-day to-do’s to lose sight of why a customer would still choose you.

  • Why do your customers choose you? (Price is the worst thing to compete on by the way.)
  • Is your solution simple to understand and implement?
  • Is the problem you’ve identified changing with customer tastes, expectations or improvements in technology?
  • Is there something so special about what you do that it would be tough for competitors to imitate?
  • Are you serving customer needs or wants? (Your customers motivations will be different for each.)
  • Are you clear on how your customers measure success? Is it money saved, time saved, headaches avoided, education provided, etc.
  • Are you providing a solution that resonates or matches up with who you’ve identified your best customer to be?

I know making trade-offs and focused decisions are hard but when you are clear on who you serve and who you don’t serve your business has an exponentially greater chance at success.

After you think about those questions for a while and get your thoughts articulated your last task is to distill all that information into a sentence or two. Your mission should not be a paragraph or worse an entire page. It’s also not the how to manual on how your business does the business of its business. (Yes, I did that on purpose because a  good mission statement is serious business.)

If you’re looking for a little inspiration one of my favorite mission statements of all time comes from Starbucks. Pulled from their corporate website the Starbucks mission is:

To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.

That’s a mission statement. Yours might not be as eloquent as that one on your first go around and that’s OK. Working on crafting your mission so that it reflects you and your business might take time. What’s important is that your mission means resonates with you and stands for something in your business. Get there and you’ll be ahead of most entrepreneurs I know.

3 Tips For Better Year-End Strategic Planning

This is a fun time of year for me. This is the time of year when I get to read, talk about and experience the wonders of all kinds of year-end strategic planning (and review) processes. It’s a blast because, for the most part, most people get it terribly wrong. They get it wrong because they follow dated template frameworks that don’t apply to their businesses, seek answers to self-referential questions and spend hours doing something that feels like work but will probably never have any real impact on their business.

My goal in this post is to give you a few quick and dirty concepts you need to consider to get the most out of your strategic planning process this year - hopefully not just a template. So before you tape your over sized Post-It notes to the walls or crack that new box of dry erase markers let’s talk about a few things.

1. Your strategic plan is not your step-by-step how to run your business manual for the next year.

It’s also not a budget. You need to think about strategy more simply and in terms of the choices you need to make that will get your business in front of the people that matter most - your customers. While budgets, cascading goals, benchmarks and actions are important it should all stem from the choices you make about the specific customers you serve and how you will serve them better than anyone else next year.

Take Away: In the strategic planning process don’t let your thought process or conversations go down day-to-day operations rabbit holes. Save the breaking down of specific responsibilities, tasks, benchmarks for later. Use something like the Balanced Scorecard (link takes you to Balance Scorecard website) to help focus on the broader financial, operational, people and customer perspectives.

2. Your strategy (or strategic plan) is not going to be perfect and that’s OK.

You’re strategy can and probably will change over time and that’s a good thing. You’re eye on the prize needs to revolve around revenue (not just controlling costs) and your customers. You want your business to be able to adapt to the changing needs and expectations of your market while honoring your vision. That means there’s always going to be a little bit of uncertainty in your planning. Give yourself permission to be OK with uncertainty as long as you’re setting up benchmarks along the way to test your strategy assumptions about your customers and the market you’re serving. If you were as addicted to Gordon Ramsay’s “Kitchen Nightmares” as I was you’d know one of the things he commented on most was the inability of restaurateurs to update their menus. So, to quote Chef Ramsay, don’t be an “idiot sandwich” and shoot for less-than-perfect.

Take Away: Don’t fight over what you can’t predict. If you run into spots where assumptions feel murky because they are based on future outcomes then you should set up times to revisit in the follow up in the next weeks/months/quarters. Conversations about what you can’t control can be draining and detract from the process.

3. Start quantifying.

Getting to the heart of making good decisions means getting to the heart of the data in your business. I’m sure (hoping really) that you had goals set for yourself through this past year. List them out and how close you were/are to achieving them. What do your sales figures look like? How big is your market? What are your margins? Who are your best customers and how many of them did you serve? When going through the strategic planning process it’s easy to get distracted by the big broad brushstroke topics. It’s easy to set goals of just “doing more” of certain activities in the next year. What’s hard is getting to the nitty gritty of your business. It’s getting real about what worked and what didn’t in a quantitative way and being honest about how you spent your time/resources/money this year. No one likes to admit to making bad choices or mistakes but you need to get real about where you are now if you’re going to give yourself a fighting chance to get better. Remember, when it comes to data and planning - garbage in = garbage out.

Take Away: Have the data of your business ready before you go into the strategic planning process. Spend some time getting re-acquainted with what’s going on in your business. This is more than just running some blanket financial statements. Look back at what you decided were key performance indicators in the past and, as honestly as possible, figure out where you stand today.

Whatever your strategic planning process looks like it’s my hope that you think about the three concepts I’ve listed above. At the heart of this process you’re announcing what’s important to your business and customers, setting goals and priorities and trickling that information down into the eventual actions and benchmarks your business needs to take to be successful. Please don’t just use some generic out of the box framework because it feels easy. Make sure the frameworks and tools you choose are relevant and will authentically support your business.

How To Make Better Choices

**Steps on to soapbox.**

I’m getting a little tired of the entrepreneurs and the would-be business coaches/consultants that are minimizing the importance of strategy. I keep bumping into claims that business plans and strategic plans are a waste of time. A waste of time? Why are entrepreneurs just sprinting to a MVP? Is it because iterating makes you feel like your business is doing something?

I’m all for minimum viable products but that doesn’t mean your work shouldn’t be thoughtful, deliberate, and value-creating. Lately objections to competitive strategy I’ve been getting are when someone from this camp claims that their lean strategic approach is the only way to deal with the volatility/uncertainty/complexity/ambiguity of today’s marketplace. (That’s the VUCA acronym for all my strat-nerds out there.) I believe, not always but most of the time, entrepreneurs are using this kind of strategy argument as a cop-out.

What?!

I get it. It’s fun to tinker. Strategic thinking takes time, research, and is a little unsexy sometimes. Not to mention the need to be consistent and systematic with how your firm makes decisions. I’m 100% for “failing fast and failing often” but I guess I would add “failing deliberately” to those first two fail prefixes. Why “failing deliberately”? Because it means you tested something specifically, collected some data, and made a choice. Here are four steps, concentric circles, or tips about how you should frame strategy.

Strategy at its core is about making choices. Planning is great but it’s the actions that are taken after everyone agrees on the plan that really matters. There’s a very real breakdown that happens when you come up with the plan and then never do the work to realize the goals or <insert success metric>. There’s also a lot of power in choosing what not to do. Channel your inner economics student/professor and try to remember all those talks about opportunity costs. It’s real and it’s a thing.

When you take a step back from the core it’s about understanding how your business is positioned in its market. This is where your business’ malleability and your market’s predictability get pulled in. How quickly can you continue to align yourself with the tastes and expectations of your target market? Do you even know who your target market is and why they should engage with you? How are your competitors reacting to the choices you’re making? Are you really getting the most out of your supply chain? Immediate follow-up answer: Yes, every business (even solo-service-providing-consultant-freelancers) has a supply chain.

Another step back from that should be around how you are communicating with your stakeholders. Anyone that is engaging with you or that you want to be engaging with is a stakeholder. Why should they listen to you? Why should they care? Your strategies success hinges on your ability to tell a story that matters. It’s that story that will drive your actions, the actions of your employees and even the actions of your customers. You need to be able to communicate in a way that makes them feel like their roles matter. Engaging with you matters. Buying your product or service matters (and also provides lots and lots of value).

The last step back has to do with planning. Planning is part of strategy. Planning is NOT strategy. Planning also isn’t perfect. It’s hard to predict the future, it’s a volatile world out there. It’s important that you think of planning as a way of surveying a landscape. It’s a way of taking stock of what you have, all the “stuff” that makes your business work. You’re looking at things like capabilities, talent, money, time, social media celebrity status and trying to organize them in a way that will get your business to achieving it’s goals in terms of mission and profitability. What comes from planning is a framework for making choices and a way to evaluate those choices as you go.

Strategy is an interesting mix of science and art. It’s also hard and scary sometimes. A good strategy will push us to be a little uncomfortable and as Malcolm Gladwell says a little disagreeable. That’s where strategy differs from planning - the act of doing something! Making choices systematically can be tough and not always what you think running a business should feel like. I’ll end borrowing from Roger Martin encouraging you to make deliberate decisions around deciding where to play and how to win as you’re trying to get the most out of strategy.

**Steps off soapbox.**

If you're still stuck or wondering how you can start to make better choices in practice right now you can download a FREE resource I made for just this occasion. It's called the Disruptive Decision Framework and all you have to do is sign up and I will hand deliver a copy to your inbox. 

Why Outcomes Matter In Your Business

There is too much focus on idea generation and idea management and not enough time given to trying things out and actually testing to see if an idea is worth iterating on. (Listen to Gary Vaynerchuk, he'll tell you that being an operator is everything!)  Every article and post I’ve seen lately seems to elude that the only way to find success through innovation is coming up with the next newest, brightest, sexiest, or most cost effective idea.

What?!

What happened to the iterative process?

The real iterative process. Not some watered down entrepreneur-light version that gets talked about in conversations between wantrepreneurs. 

What happened to going out and talking to your customers or potential market to figure out what they wanted? Then taking it a step further and seeing if they'd put their debit/credit card on the line for it. 

What happened to doing the work to test whether an idea had merit or could be adapted to succeed?

What happened to making real and action oriented decisions

In order to address those questions entrepreneurs have to first learn (re-learn) how to think about outcomes.

The funnest part about what I do is that I am always getting the opportunity to help entrepreneurs and even politicians understand that strategy is not just about a plan of action or a set of goals you might be working towards. It’s about creating systems to make good choices and to clearly evaluate possible outcomes for those choices. Thinking about as many possible OUTCOMES is such a big part of strategy!

I need you to think back to your high school or college economics classes. You may vaguely remember hearing about oligopolies as a particular kind of way a market might organize itself. It’s not a board game and I’m not going to give you a pop quiz about that particular market structure but what I do want you to try to remember are the concepts around Game Theory.

With me?

Even if you have no idea what I’m talking about I promise it will make sense in a second.

The neat thing about this simple “game” you played in your economics class or that you’ll see in the Game Theory Wikipedia entry is that all the possible outcomes were laid out in front of you. As either a player in that game or as an objective observer of the game, think Dungeon Master if you’re a D&D fan, you were able to always make the choices that were not only best for you but wouldn’t leave you making a decision that could get you into trouble. That’s dominating strategies vs. dominated strategies.

No one wants to be told that they are a bad decision maker but if you are constantly pushing yourself or your team to come up with new ideas you might be falling into bad idea territory. Before you make a commitment to allocate time and resources to idea generation you should evaluate the ideas or business choices that are already on the table. Are you measuring them effectively and can you make marginal changes to increase performance or get to however you are measuring success? Best of all you should be thinking about the outcomes of your ideas or choices.

You’re probably thinking at this point - ok that sounds good but what outcomes should I be looking for? The outcomes you are concerned with are the responses you could anticipate to your choices by your competitors and customers.

How might your customers respond to you offering a discounted version of your service?

Would they still perceive it as valuable?

What about your closest competitor? Would they try to undercut your new discounted pricing to try to stem market share?

Answers to those questions are outcomes. The better you get at trying to anticipate how people and businesses might react to the choices you make with your business the better prepared you will be and ultimately you put yourself in a position to be more profitable. You won’t have to waste time scrambling for the next idea or worry about losing customers because you will have responses and resources allocated/planned for the fallout (good and bad) of any choice that you make.

That’s strategy!

It came from iterating and evaluating not just rushing some new idea to market.

How To Disrupt And Innovate Right Now

Today I want to channel my inner Seth Godin.

(Short posts that generate reflection and inspire action.)  

I want to challenge you to disrupt and or to innovate right now. Wherever you are, in whatever role you serve in your business and in whatever project you are working on as you’re reading this.  

Disruption is not a strategy. It’s is about simplification. Look at your business. Are there any parts of your customers experience that you can simplify or streamline? Is the value you offer simple by design so that your customers know exactly the pain you solve? Can anyone (I mean anyone) understand your pitch? Where can you attack a problem non-conventionally or even contrarily so that your business stands out against your competitors a little more?

Innovation is about efficiency. What can you do that will save your business time, money, emotional energy or even just keep your audience engaged. Innovation happens when you can generate ideas quickly, then test and experiment ideas and finally decide what’s important to your business. Where can you add value without adding costs?

Disruption and innovation don’t have to always happen on a large scale. It’s also not only for technology companies our of Silicon Valley. I challenge you to look at your systems and try to find small changes you can make today that will push you business forward, in whatever way you measure your progress.

 

Don't Get Stuck In Strategy Sensory Overload

Henry Mintzberg is a man after my own heart. Too bad you, dear business builder, have probably never heard of him...yet. Emergent strategy is going to be the approach that makes sense for the agile, lean and <insert another word for business flexible> models.

You’re welcome.

Writing about strategy has been awesome for me. It’s forced me to really funnel through all the academic and corporate strategy hype so that I can bring you the most distilled and actionable pieces of strategy goodness. Recently I stumbled upon what is my new favorite definition of what strategy is - “the integrated set of choices that positions the business in its industry to generate superior financial returns over the long run”.

Integrated set of choices. It’s brilliant!

In this definition you don’t see the words: plan, technology, social media, or marketing. What we are talking about is getting to the heart of how you will decide to run your business. This post is dedicated to anyone wanting to up their strategy game and are paralyzed with conceptual strategy sensory overload. Here is your 3 part strategy jumpstart.

In thinking about your integrated set of choices you should be framing them (at least at the start) into one of two camps.  Are you going to differentiate or attempt to be the low cost provider?

I am drastically oversimplifying but if you are wondering what your first steps should be when trying to build a new strategy I would recommend the following 3 steps.

1. Work out your business model.

Business models can change over time and when most people think they are talking about strategic planning, they are really talking about outlining their business model. The what’s and how’s of their business. Flushing out your business model will give you a better idea of what the entire process might look like for the customer or client experience. This is how you will make money. Once you settle on something don’t worry about tinkering with trying to get a few extra fractions of percentage points in profit out of it. Odds are it will probably be changing over time. Leave it alone, start doing the work you outlined and start collecting outcomes.

2. Pick! It’s really hard to be the low cost innovator in any industry or business.

How you get to the golden “disruption” is by experimenting and iterating with your customers. I’m not saying it’s impossible to fly out of the gate and be the instant lowest cost and most needed differentiation in the market - I’m just saying you might get a better return on your immediate investments by picking one and working at it for a little while. I’ve seen many guru’s and self-titled experts misguide clients with hopes of finding the holy grail of competitive advantages that will place them leaps ahead of their competition. That’s not how it works. You need to pick first and then start doing the work to best serve who you think your best customers are right now while doing the best you can to understand the drivers and motivations of your market - especially your competitors because they are going to be the ones reacting to you!

3. Work on systematically making choices that support your pick from number

Any time a decision has to be made you need to be able to objectively qualify it as either supporting your overall strategy or not. If it doesn’t, is there a way to tweak it so that some part of it still might. This is where the fun stuff happens. It’s all in the rationalization. What I mean by systematically making choices is to constantly be evaluating how your are conducting business.

Here’s an example: As part of a service offering you provide paper copies of all your materials. You could go to Staples and keep buying paper because it’s closer, convenient, and instant. Because of that convenience you are probably not getting that paper as cheaply as you might be able to if you worked on creating a relationship with a wholesale or office supply dealer. Now, if you are competing for low cost you might want that mass distribution discount rate but if you are differentiating and Staples offers a very specific, specialized paper then you will have to translate some of that cost over to the end consumer.

This is the decision part. Are you the low cost provider or are you trying to differentiate?

Situations like this happen every day and it’s important to make choices consistently - yes even the smallest ones. This is how real strategies gain momentum, by adjusting behavior and monitoring outcomes. Yes there are bigger frameworks like Porter, Blue Ocean, and Resource Based View that you could be considering. You absolutely should but, don’t get bogged down in the learning and understanding that you never put those frameworks into practice.

Take the first steps and make a few choices now and hold yourself to them. Then iterate as you go!

How To Get The Most Out Of Your Next SWOT Analysis

I am throwing the gauntlet down on SWOTs. I'm tired of people telling me their organization/team/business did one and it wasn't useful. I'm so amped up about this topic that I'm not even including a call to action in this blog. Well besides me trying to show you how to do a SWOT better and how to make it be actually useful for your business decisions and strategy. 

No shame in my game. This image came straight from the Wikipedia entry on SWOT. The content that follows most certainly did not.&nbsp;

No shame in my game. This image came straight from the Wikipedia entry on SWOT. The content that follows most certainly did not. 

There are lots of tools to help you through your strategic thinking and planning process. So many it’s hard to choose sometimes - really hard. This post is dedicated to using one of those tools well, the SWOT Analysis.

I know.

I can feel it.

I’m already losing you and this is only sentence six.

Hear me out though. You need to ask yourself, have you ever really SWOT? (For my internet friends, "Do you even SWOT bro?") If you do it well a SWOT has the power to bring people together, save your company time and help you get the most bang out of whatever your budget looks like - including a low/no budget operation.

A strategic tool is only as good as the information and the intention that goes into it. A lot of business owners stick their noses up at the idea of going through the process of a SWOT. They think that a SWOT is too rudimentary or not powerful enough to handle the complexities of their business. I blame MBA's (who I have much love for and have been a professor to) and business gurus too for ruining this tool. 

I vehemently disagree that the SWOT analysis is too simplistic. I think it's perfectly simplistic and more often than not, business owners make things too complicated for their own good. 

That's not you of course. 

I think the SWOT is a great tool for organizing ideas, identifying your business model (you’d be surprised to see how many business think they are in one kind of business but in reality are in a totally different industry) flushing out themes and core competencies, and even helping to identify your competitive advantage.

The goal of the SWOT is to get information out in the open so that you can make decisions. The SWOT will not make decisions for you. This is so important you have to read it again. The SWOT will not make decisions for you. It’s not a decision making tool (that link takes you to a really great and free decision making tool) and I’m not thrilled about some people using it as an “icebreaker” for strategy talks. Let’s give Albert Humphrey and his SWOT the respect they deserve!

SWOT stands for Strengths, Weaknesses, Opportunities and Threats. The S and W should be internal questions - the things that are happening in your business. The O and T should be external questions - what’s happening around your business. You’ll see a SWOT in lots of shapes and formats but that’s just working space. Your SWOT can be a list or a matrix. What matters is the intention and content.

Let’s start with Strengths.

When you are thinking about your strengths it’s important to think about why your customers buy from you. If you can get to your customer’s why you’ll be able to communicate with them more effectively and consistently deliver awesome value. Here are some other questions you should be thinking about in terms of your strengths.

What’s your unique value or unique selling proposition.

Are you doing anything that your competitors can’t reproduce - like your level of customer service.

Are you a low-cost producer?

How do you differentiate?

Are you creating barriers to entry to insulate yourself from future competition in any unique way?

Do your customers say that you do anything really well?

Next are your Weaknesses.

Don’t approach this like you would if you were answering an interview question for a potential dream job. No fluff here! You need think about how you’re delivering value to your customers or clients. There are always parts of the business that can get more efficient or capabilities/capacities you can improve. In terms of creating a meaningful strategy the more honest and raw you can be about your business, processes and systems the better the decisions you will produce. Here are some questions you should answer honestly in terms of your business's Weaknesses:

Are there improvements that can be made to better compete with your strongest competitor?

Are there products/markets/services you should be avoiding?

Are you measuring success in any kind of definitive way? If you do, are there factors in your businesses that aren’t measuring up?

Are there parts of your business that lead to lost sales/revenue?

Is there waste and where is it coming from?

Are there core capabilities you should have that are keeping you from being more successful?

On to Opportunities.

Opportunities are new chances for your business to either continue to differentiate or to reinforce your competitive advantage. The goal being an increase in revenue or market share if an Opportunity is pursued. A great place to start looking for Opportunities is to glance back up at your Strengths and Weaknesses and start comparing what’s going on in your business to the businesses you compete with. Here are some questions to get you thinking about your Opportunities:

Are there new or interesting trends in your market?

Are your customers tastes or expectations changing?

Are there new technologies in your market?

Are your customers getting the most value out of the current set of solutions offered?

Are there new pains that customers are suffering from?

Sorry to use a word while it’s being defined but: Are there any opportunities to better serve your market that can be done only by you?

Last are the Threats.

Threats are external factors that could influence your business that you can’t control. They are negative factors that could impact your business alone and even your potential industry. Threats are factors that could have a negative impact on your business in terms of both decreasing revenue and operations interruption. Here are some questions to get you thinking about your potential Threats:

What external factors put your business at risk?

What obstacles does your business face?

How stable and predictable is your supply chain?

Are you protected from changes in technology?

Is your market changing? How?

How have your competitors reacted to decisions your business has made?

What does your current and potential competitive landscape look like?

After you’ve answered these questions and maybe even a few that weren’t listed you are probably asking yourself, now what? Well first thing is to go back through your SWOT and to try to frame everything you listed in terms of your competitors. Next is to try to make each component as specific and as clear as possible. Remember you are trying to use this information to create strategy and make decisions. Being clear and specific is important! Then make sure that everything here is as close to factual as possible and that it’s a reality now not a want or wish. Use dollar amounts, inventories, sales, time, and any other way you are quantifying your business activity. Lastly is to make sure that everything in your SWOT is as action oriented as possible - action words are your friends here.

After you’ve brainstormed your SWOT and have gone back through and polished it up you can start to use what this information. This is the information you should be using when you are starting to create short-term and long-term strategic plans/actions to grow your business. The purpose of the SWOT was to get you laser focused on the most critical parts of your business.

Now that you’re focused you can make better decisions in your business. Start by going through and trying to prioritize your most pressing opportunities. Decide which opportunities you are going to engage and set the goals and actions in place to start the allocation of resources and work to achieve those goals. Measure everything! Go back through your strengths and try to rate them. This will give you an idea of how to better differentiate and position your business to strengthen your unique selling/value proposition. Take a look at your weaknesses and really try to create systems to improve them. You’re supposed to use this SWOT as a springboard.

The worst thing you can do is nothing after you complete the SWOT! 

So the next time this comes up in your business or in your profession, I want you to calmly pull up this blog post and drop the SWOT gauntlet down in your group. You'll be a strategy hero. 

 

Why You Should Care About The Market And Strategic Aspirations

The market decides what it wants. It decides how good you are and at what price consumers/clients/buyers are willing to pay for you. That means you need to get really clear and articulate about the value you’re bringing to the market. Big fluffy mission statements that try to reach everyone are just an exercise for boards and executive teams that makes them feel good about themselves that day.

No joke, a mission statement doesn’t cut it any more. Having your vision statement or your core beliefs taped up in a common space or over your computer monitor will only marginally motivate you and your stakeholders. In order to get the commitment and the engagement from yourself and your customers or audience, you need to be able to deliver value and communicate that value in a universally understood language. In other words you have to let your value show everyone in the market that you are worth paying attention to. Once you get clear about that it’s at the crossroads of value and meaningful communication where you will find strategic aspirations.

There has been a lot of buzz around the word “aspiration” lately. I hear it in the business audiobooks I listen too, the blogs I read and all over the Harvard Business Review site. Large businesses use aspirations to paint a picture of what the world will look like in the future when every consumer utilizes their product or service. If you’re struggling for an example to visualize, I will happily oblige by offering you the imagery of the “Buy ‘n’ Large” mega-corporation from Disney’s Wall-E. Talk about the future of consumerism... But what does it mean to the independent entrepreneur who is out there everyday hustling to find success?

You aren’t “Buy ‘n’ Large” and this isn’t a Disney Movie.

Your strategic aspiration is your conceptualized view of what success looks like. It’s the scenario you play in your head of what your business looks like when it’s firing on all cylinders. That means you delivering your most valuable work to the people or businesses that need it most. That also means that you have to work everyday at clarifying what your aspirations are - especially because they can change and that’s ok!

Strategic aspirations are not daydreaming and well wishing. They are not empty intentions. Your aspirations are the foundations of the strategic choices you make going forward and will guide your allocation of resources. As an entrepreneur you are constantly making choices and are constantly battling resource constraints. Often your aspirations will help you make the best possible choices by default (with a little practice that is). Getting crystal clear in your aspirations will help you evaluate your choice outcomes and navigate them in a way that produces outcomes that will move you closer to realizing your aspirations.

The neat thing about strategic aspirations is that you don’t need a gimmick to remember them. Because you put in the work to figure out what success looks like, feels like, and even smells like your aspirations should be resonating with you to your core.

As an entrepreneur or a professional with entrepreneurial tendencies, life is a constant balancing act. Aspirations provide the framework for how your business will behave and a systematic way of checking in with yourself. At this point if you like your taped document or stick notes above your computer you can put them back up. Only if you are really clear about what success looks like. When you do the work and get to the core of clearly identifying success for your business you can start to deconstruct it into steps you can take daily to get there.

After I get clear on my aspirations what happens?

I have a very simplified set of tips or tactics that you can implement right now. Not overly complicated and not overly difficult.

Decide What Matters: Figure out how you are going to measure success. Here, the fewer the metrics the better.
Everyday Action: Figure out what you have to do daily to get you to your aspirations.

Week/Monthly Action: Work in time to evaluate how your weeks/months are going based on what you’ve done and what you decided matters.

Quarterly/Annually Action: These are the things that have to happen for your business to grow as you want it. Your individual daily actions might not necessarily provide the direct outcomes needed to get here but they should be building to these goals or plan.

That’s it. The hardest part is not the planning, especially because that can change. The hardest part is deciding what’s important and then doing the WORK! So figure out what you can do daily to help push your aspirations forward and take some kind of action today!

How To Create Better Strategy By Going Simple

Simplify Strategy

Being “disruptive” at it’s core is about simplification. Getting to outcomes or results more simply by better using the resources you have around you, by creating more efficient processes or a little bit of both. Disruption is all the rage these days in startups all over the world. There are books dedicated to teaching you to innovate in disruptive ways and conferences that pull entrepreneurs and programmers together to celebrate and showcase how markets are disruptively evolving. There are companies pitching for investor dollars everyday because they’ve thought up tricky ways to deliver value to customers in markets that have been stagnant for decades - think Uber.

You’re not Uber though (yet). So why should you care about disruption?

Thinking in terms of disruption is very good for running your business. The best part of thinking disruptively is that it doesn’t cost much and you don’t need a fancy set of tools to implement it well. In this blog post I outline three tips to help you get to simple so you can get more out of your strategy and your business.

Think simple for your next attempt at a strategy you want to try out. Running a business successfully means managing a lot of moving parts, there is no getting around that. Lots of running parts often leads people to think that there’s too much complexity to try to navigate around. I’m encouraging you to think about the parts of your business that you can simplify by a step or two. What are the processes you wake up and start in on everyday? At any time any one process might be a positive thing but look at what those singularly good processes are doing on the entire company. Are they slowing things down? Making it hard for information to flow or for decisions to get made? Besides trying to simplify how you do business, which could conceivably reduce your resource burn, how you position your brand and what you stand for also doesn’t have to be complicated. Think simplicity and act like 37Signals.

If you aren’t familiar with 37Signals (now officially just Basecamp) they are a firm that not only puts out amazing software but has published a few really rockstar entrepreneurship books. (One that I re-visit daily is ReWork.) What makes them simple lies in their product offerings: Basecamp, Highrise, and Campfire. Each of these SaaS product offerings are very specific and very simple in their functionality.  I want to highlight Basecamp in particular. It’s SaaS business that is built around one thing project management. If you go to their website today you’ll see that they are pivoting their model yet again. They are going all in on Basecamp. They are taking their already simple model and drilling down to get really good at one thing. Project Management.

37Signals is an awesome example of how a business can cause innovative disruption, continue to differentiate themselves, and succeed. ( I swear this isn't a plug, just really like their model.) This is also not the only thing I want you to take away from this post - I want you to walk away with some tips on simplifying your strategy and finding success.

1. Start with the why.

This one is a little introspective but seriously, why are you in business. The more honest you can be about what your business does, the better. Stop trying to do everything. I did that once and I burned myself and a few relationships out. No bueno. When you can craft a story behind the motivation of why you are in business it not only helps your stakeholder’s relate to what you’re doing but it helps to make decision making in the future just a little easier because you have a story compass to follow.

2. Boil down to what matters most in your business.

What are the most critical functions within your business. What needs to happen every time so that a customer is delivered an amazing experience. Focus on flushing those out and simplifying them as much as possible. There is so much bloat in even small companies these days because firms are trying to hard to be the all providing problem solving experience for the customer. That suffocates your “why” and your mission and makes it harder for your key processes to work efficiently.

3. Fight wanting to do more.

I don’t mean get lazy what I do mean is flex your “no” muscle. As the economy continues to recover and expand it will be tempting to want to reach out to new markets or offer up complimentary products or services. It will sound great and you might even produce data that would support chasing customers in a new segment but you should fight that urge. Instead focus on being the best you can be at a few core competencies, offer more value, innovate, and reduce costs. Work on serving your clients and customers the best way that you can. This will keep you from feeling overworked, spread too thin, and help to keep you from wasting resources. If Google can and did unload Motorola to Lenovo that has to create some kind of social proof right?!

Simplify doesn’t mean easy and it doesn’t mean lazy. It means serving very specifically and very intensely to a focused market. When you do that you create opportunities to differentiate in a way that makes it very hard for rivals or competitors to match because you cultivate a depth of understanding and relationships that someone just strolling into your market won’t find. There are a lot of programs that do way more than Basecamp and I’ve tried them - only to hate them and make my way back to a software that is easy to use, has awesome customer services, and always does what I expect it to do. Make your business do that in your industry and you will have no problem being as successful as someone like 37Signals.

3 Tips To Creating Strategy That Works

There is such a thing as too much strategy. Way too much.&nbsp;

There is such a thing as too much strategy. Way too much. 

There is so much advice on the web about creating strategy. Lots of frameworks, lots of fill-in-the-blank plans and LOTS of generic advice that you write down but never really know how to implement.

I hate it.

So in this post I’m not going to give you a dashboard to work through or some one-page cheat sheet. That’s not to say that I’ll never do that or that it’s not helpful to have guides but today is all about getting to real progress quickly. This post is going to teach you the three most important things to think about when you are crafting your business strategy or you are trying to make decisions about what you’re going to do to get your business growing.

1. Focus on an identity. You need to get crystal clear on who you are, who you serve and why it’s important. When you focus on your identity it takes the pressure off of just focusing on generic growth targets and ideas.

Here’s real life, when you focus on generic growth you are inclined to do all the growth oriented things everyone else is doing. Which eventually just turns into stuff that looks like work. That means you’re thinking about making things more cheaply, trying to chase more of your market or even thinking about your next product/service offering based on the ebbs and flows of your competitors actions and consumers changing tastes. All that stuff takes time, energy and money that could be better spent by better honing in on who you are, why you are valuable and doing the work that only your business can.

When you focus on your identity all kinds of fun things fall into place. First, you better align yourself and your actions with your value proposition. This is a big deal because it re-enforces everything from how you make decisions in your business to how you deliver value to everyone outside of your business. Next everyone that interacts with you, buys from you or is in your audience better understands what you’re great at and why that sets you apart - in business-speak it’s your clear system of capabilities.

Lastly, focusing on your identity allows your audience or customers the chance to really fall in love with who you and your business are. It better allows you to create and foster an authentic relationship with them. You need that trust because it’s in that relationship and your differentiation that will keep people around and hungry for the work that only you and your business can do.

2. Strategy needs to be everyday. Strategic plans can sometimes be these big silly, overly complicated documents that you write and then instantly deviate from because it’s focusing on what you think you’re idea of your business is versus what you’re actually doing every day. Setting goals, figuring out what’s important to measure and having benchmarks are all great things - just make sure they reflect the work you are actually doing. When you’re building a strategy for everyday you don’t want to focus all of your energy on the big pie-in-the-sky stuff, you want to focus on what little things. Get really clear and focus on a small number of things that you do well and work on getting even better at them. (These are those pesky capabilities again.) Those activities is the heart of the work that you’re doing that ultimately reflects your values and reinforces your value proposition. You want to outline in detail the stuff you’re great at so that your employees or even virtual assistants can without any question replicate the experience you’re working to create for your customers.

If you’re not growing or don’t have any virtual assistants that’s ok too. You still want to do this stuff because it will help keep you focused and accountable to the work that matters as you’re growing your business. It’s definitely not a secret that there can be lots of distractions at any given moment in your business. As your business grows or iterates there will be lots of small changes so you want to make sure that you are keeping an eye on the stuff you’re trying so that you can pinpoint the stuff that works and continue to develop that.

3. Cutting costs helps you grow stronger. I know, sounds a little cliche but hear me out. Businesses that do the best jobs at closing the gap between what they planned to do and what they are really doing are businesses that have a near superhuman stranglehold on their expenses. I’m not going to tell you that you’re never going to spend money as you’re trying to grow your business.

That’s just downright misleading.

What I am trying to tell you is that the businesses that do the best are making sure that every dollar they spend is being spent to support what they are great at and as little as possible on everything else. When you’re looking at your business you need to be thinking of every expense as an investment, not just numbers in a checking account or in a report that Freshbooks (or Quickbooks) generates every month. You need to think in terms of opportunity costs and be constantly measuring what you’re spending money on and how that’s going to add value to your business.

Coffee meetings and business cards shouldn’t be necessary evils that are just rationalized expenses. You want to make sure, guarding money just like you should be guarding your time, that if you are allocating a resource or handing out a business card that it’s going to a person to which you can provide a ton of value.

That’s it! Those three things will help you create a strategy that actually works for you. Why?

1. When you don’t commit to an identity, your identity, you run the risk of washing yourself and your business out. You’ll scatter who you are and what you do so thinly that your audience won’t have anything compelling enough to hold on to and eventually engage with.

2. When you don’t make your strategy an everyday thing you run the risk of doing the same stuff that you’ve been doing all along. How can you affect change if you can’t distill what you want out of your business in a way that you can take action and implement daily? Answer: You can’t!  You don’t want to be the business that promises lots of things and struggles to deliver or worse never actually grows into the vision you had for it when you started.

3. When you don’t keep an eye on your spending, more specifically spending on the stuff that really matters you run the risk of self-stunting your growth. Money is easy to lose sight of because it’s easy to fall into the “I’m a habitual consumer trap” or the “if I had this one extra resource I’d be successful trap”. Be mindful and cut costs to grow stronger.

Building your strategy for your business is going to be a process. There’s going to be happy tears, sad tears and lots of anxious tears. That’s ok! When you’re following the advice of your favorite growth hacking guru or in my case I like to follow lots of different economists I want you to just remember these three things along the way. They will help ground you and help you build something that works with and for you.

Why Are Strategic Plans The Worst?!

I hate excuses. I think that the old way of creating long form strategic plans is an exercise in preemptively creating excuses for your business. Strategic plans are so often argued over, passively decided on and luxuriously spiral bound for businesses that haven’t yet done the work necessary to truly understand the impact of the decisions they are (or aren’t) making in their business. My favorite offenders are the one-page downloads that promise to, in one-page, definitively nail down the over-arching strategy you’re going to implement or execute on in your business. Definitively. All that stuff that looks just like strategic planning busy work is just that, it’s busy work and a scapegoat for you to blame your business shortcomings on later.

Don’t get it twisted though, I’m not at all down on crafting strategy for your business. Articulating goals is great. Teasing out effective ways for you to track whether or not your efforts are pushing you towards those goals, even better. Evaluating the decisions you make everyday against the backdrop of the vision and values you and your business stand for, the best. I’m just down on how maybe some institutions frame strategic planning…<<cough cough>> Some bad “business” mentors/consultants <<cough cough>>

But, that’s hard.

Getting to real understanding and depth in your business and for your customers means doing the work to understand more than just what you do and what you offer. It means getting to the heart of why your consumers choose (and maybe keep choosing) you, quantifying the real value you offer (not what you think you offer) and the ability to objectively identify what’s working and not working in your business.

Let’s set the scene. You're a new-ish business owner. (In business for yourself for less than 3 years.) You’ve been at your craft for a while, have moved a few units and/or have delivered a some hours of your services. You believe you bring value to your target market and you may even have a few testimonials on your website that support that claim. You wake up one morning and decide that you need strategy to get your business to the next level. That’s what you’ve read on the internet from your favorite “teach you how to build a business” business guru so it must be true. You’re first, albeit unintentional, excuse as to why you haven’t grown into the lifestyle or business size that you want is that you haven’t had a good strategy.

So you set off one morning and Google all kinds of fun strategic planning based keywords and over and over again you see the same kinds of results:

  • Articles about the Balanced Scorecard

  • Wikipedia Definition

  • HBR Articles

  • Forbes Articles

  • Software/Web-App Planning Tools

  • Dummies.com Articles

  • Assortment of colleges and university course resources

Great. Now what?

I know what. You download the worksheets, read the blog posts, listen to a few podcasts and probably even peruse a few HBR articles. That’s great, you just spent hours getting your learn on. I’m all for learning but your shotgun scatter patterned attempt at muscling through how to create a strategic plan has forced you to a cross roads. Also on top of that, you’re still not even sure what the value of a strategic plan is for you and your business. #mixedmessages

At this point you’re making a choice.

  1. You are either going to keep powering through and are going to try to recreate a strategic plan from some template or example and try to force what you “think” is important into a mold that most likely has nothing to do with who you are and what your business actually does.

  2. Or you’ll quit. You’ll quit and move on and rationalize that you are too busy, too small or that crafting strategy really isn’t right for YOUR business.

Both are terrible but, are totally natural reactions. It’s the result of oversaturation/information overload, you're wrestling with how to spend what scarce resources you can muster on this task and business guru’s trying to package some program to sell you in a $497 ecourse.

That’s why strategic plans are the worst. You just spent all this time trying to figure it out and have made your way to creating something that is not at all authentic to you and your business or you move on from it all together.

Strategy is important and it hurts my heart that business owners never get to see the value of good strategy. Strategy that comes from deliberately thinking through problems and opportunities and actively participating in the choices that come from that thinking process.

Instead of trying to slap together some word document that you’ll only reference once or twice a year try this instead.

The Strategic Un-Planning Process

Below I’m going to outline an example process that you could use in lieu of the templates you just downloaded that I bet will work better for you and matter more to you. It’s not the be-all-end-all in strategic planning but if I can at least help one person who’s reading this create something that has the potential to be a real asset over some generic nonsense it’s 100% worth it.

1. Figure out what your long game really is for your business and be able to articulate that long game. Is it a specific idea of what you’re life will look like, some large financial goal or building a legacy business. That’s going to be the big idea you measure the choices you make everyday against.

2. In smaller intervals what kinds of goals are you going to have to hit to get to your long game. In strategic planning speak these would be your strategic aspirations. Is it buying a building, controlling 40% of your market share, selling one-billion hamburgers? Again get specific.

3. Repeat number two again but do that process for each of the individual goals you listed from step two. That should get you to a place where you can identify the actions you need to keep track of on a daily/weekly/monthly basis to get you to those goals. I’m all for impact and engagement but to be the most effective you need to associate actions with dollars.

4. Look outside your business. Talk to your customers about the value they really get from your offerings. What are the biggest pain points that customers can specifically share with you that you’ve solved. This will help you get even more focused in your offering and how to better position it in the market.

Before we move on I just want to recap what you will have really done up until this point. Going from 1-4 means you’ll have honestly reflected on what matters most to you, you’ll have broken down to at least two tiers worth of goals that you need to hit to get there and started to work out why people are engaging with you to better frame the actions you need to take to get more customers through the door. We are flying through these steps in a very simplistic way but this is all the work that I talked about in the beginning of this post.

 5. Look at your business. Really, truly, objectively look at your business. Do your day to day actions reflect the value that you bring to the market? What does it cost to get one more customer? Is there a gap between what you planned to do at the start of your business and what you are actually doing? Are you making excuses right now because there’s a little bit of dissonance stirring in your brain about this stuff? It’s time to do something about that right now. You need to DECIDE what the actions are in your business that are the biggest drivers in how you deliver value as well as get in front of potential new customers. If you’re struggling with this part I’ve built a decision making framework that you can download for free. (Notice it’s not a one-page strategic planning template. You’re welcome.)

6. Pick a handful of actions to really focus on in your business. Think of them as strategic themes. These are the types of work that align best with what’s important to you, your customers and what you want the business to stand for. Figure out what success for each of those actions looks like in a quantifiable way and how each of those themes will get you to your short, mid and long game goals.

7. Get to work and stick to it! What gets measured, gets managed. This is where the work really begins because here you’re working to prove the hypotheses you created for yourself. Just like in 7th grade science class you need to collect data and that data comes from getting your hands dirty. Creating and managing strategy is a daily practice and it works best when you can make decisions against the outcomes your actions are showing you. No winging it, no shortcuts, no more guessing about what you think people want - just data.

8. Rinse and repeat as necessary. What’s important to you may change over time and being honest about that is what makes strategy work. If you’re long game changes, your goals change or your market changes it’s ok. It just means that scale and scope of your work needs to change. This is where old timey strategic plans fall flat on their faces. When you or your business change, your work has to change or else your productivity and the quality of your outputs are going to drastically deteriorate. Think about the last time you worked on something you hated. You probably did the minimum and just went through the motions. If you are building a business I’m guessing that you don’t want to find yourself just going through the motions. Your customers probably don’t want that either.

I hope that if this blog post did anything for anyone it at least saved you a few hours of mindlessly searching for strategic planning resources on the interweb. This post was not designed to be a conclusive resource for your strategic planning needs but it was designed to challenge you to think. If you are pressed for time or resources I like to think that I’ve also offered you an abridged approach to creating something that matters for you personally.

Strategic planning is really a personal (business personal?) process and it’s not something you can just hammer out in a one page template and expect any real results. It’s a process that you have to work at everyday and one that requires you to get brutally truthful with. The people that buy from you or that you’d like to buy from you aren’t stupid, they know when what you’re offering is lip service. Customers know what authenticity is and how to hunt for the most value. Strategy at its core is about making decisions to so that your customers can find that value.

So, are you making decisions everyday that will match what you’re offering and how you deliver with the needs of the people that you serve?