Monday, November 19, 2018

5 Barriers To Wise Delegation In Business Leadership

delegate-in-businessI often wonder how many more startups would succeed if their founders could master the art and science of delegation. It seems inherent in the mind of most first-time entrepreneurs that it was their idea, and they must do all the work themselves to make it happen. In my role as mentor and advisor to many founders, I consistently fail in convincing them of the power in wise delegation.

I saw this challenge highlighted well in a new book, “Leadership Skills that Inspire Incredible Results,” by Fred Halstead. He has spent many years coaching and consulting with over 200 organizations, and he has helped me articulate the benefits of delegation, and better understand some of the key barriers. Here is my list of barriers to effective delegation, with tips on improving:

  1. Thinking only you can implement your dream idea. The reality is that starting a business is much more than building a solution, and requires a range of skills beyond the limits of most mere humans. Even if you can learn and do everything, time is a killer in this rapidly evolving world of business and technology. You need to divide and conquer.

    For example, even though the technologist Bill Gates ultimately proved that he could run all aspects of a business, his early delegation of the marketing issues to Steve Ballmer, trained at Procter and Gamble, proved to be a powerful partnership that kept Microsoft ahead of many strong competitors in the early days of the personal computer revolution.

  2. Unwilling to take the time to explain and delegate needs. It’s a mistake to think that team members share the same insights that you see, and will automatically take on the role required for results. Even your most loyal and dedicated employees need guidance and direction, and will wait for you to delegate and explain. You can’t afford the delay.

    I find that it takes less time to explain what you need, and specifically delegate results, than to manage the chaos that occurs when many several well-intentioned people are all trying to guess what you need and do the right thing. Delegation also actually helps you to clarify and organize the requirements in your own mind.

  3. Not trusting key team members to get required results. Of course, full trust must be earned, but it is critical to do some due diligence before hiring new team members, or establishing partnerships. Yet too many new entrepreneurs are paranoid, assuming that everyone has some other agenda, or may steal their idea.

    After due diligence, the best approach is for you to be vigilant, but explicitly communicate your trust and confidence in their abilities. This will reinforce their commitment to your cause, and will relieve you of the constant extra effort of looking over their shoulder.

  4. Lack of your own clarity about what it takes to succeed. Some entrepreneurs won’t delegate because they lack confidence in their own understanding of the road ahead, and don’t want to embarrass themselves. Others simply find it hard to communicate the “why” and the “how,” or they are easily frustrated by team members who are struggling.

    The solution here is to use probing questions with peers, other team members, and advisors, and then listen carefully to all input. This dialog with clarify your own understanding of the requirements, as well as theirs. It will also help you decide who is the right person for delegation, and improve your own communication to all constituents.

  5. Afraid that delegating means losing control. The job of an entrepreneur is a big one, so you can’t afford to be a “control freak” or a “micro-manager.” Delegation is not about giving up the ultimate authority and responsibility for the business, as you will always be the founder and final decision maker. Use wise delegation to multiply your success odds.

Above all, always remember the golden rule of delegation – focus on results, not tasks. In other words, you need to tell the delegate what needs to be achieved, rather than exactly how to get it done. Only then can you leverage their expertise and efforts, hold them accountable for outcomes, and have the time to enjoy the fruits of your joint success.

Marty Zwilling

*** First published on Inc.com on 11/05/2018 ***

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Sunday, November 18, 2018

7 Steps To Meeting Your Goals With Your New Venture

goal-setting-stepsSuccessful entrepreneurs are usually hard-driving, and highly focused on some specific goals, like being the dominant player in a given domain, or the low-priced provider of their product. Yet other entrepreneurs will talk for hours about all their ideas, and how they intend to change the world, but I don’t hear any specific goals or milestones.

Many people are very hesitant to set specific goals, due to lack of self-confidence or whatever. The result is that they don’t ever get anywhere, because they never really knew where they wanted to go. If you find yourself in this category, try the following simple steps highlighted by Brian Tracy in his classic book “No Excuses: The Power of Self-Discipline”:

  1. Decide exactly what you want. If you want to increase your income, decide on a specific amount of money, rather than just “make more money.” Without precise goals, you can’t measure progress, and you miss the real satisfaction of knowing when to declare success.

  2. Write it down. A goal that is not written down is like cigarette smoke; it drifts away and disappears. It is vague and insubstantial. It has no force, effect, or power. It’s too easy to forget or push aside when outside forces arise that you hadn’t anticipated – and they will. On the other hand, most people don’t hesitate to write down excuses.

  3. Set a deadline with specific milestones. Pick a reasonable time period and write down the date when you want to achieve it. If it is a big enough goal, set intermediate milestones for measurement reference points. The rule is “There are no unrealistic goals; there are only unrealistic deadlines.” Don’t be afraid to change the deadline – for cause.

  4. Make a list of things you need to do to achieve your goal. The biggest goal can be accomplished if you break it down into enough small steps. Make a list of obstacles and difficulties, knowledge and skills required, necessary people, and everything you will have to do to meet the goal. Add to these lists as you learn more.

  5. Organize your list by both sequence and priority. A list organized by sequence requires that you decide what you need to do in what order. A list organized by priority enables you to determine what is more important. Then develop a business plan which embodies all of the above.

  6. Take action on your plan immediately. Don’t delay. Move quickly. Procrastination is the thief of time, and it shortens your life. Winners in life take the first step now. They are willing to overcome their normal fear of failure and disappointment, and take a small step, and then other one, until they reach the goal.

  7. Do something every day that moves you in the direction of your major goal. This is the key step that will guarantee your success. Do something every day that moves you at least one step closer to the goal. In this fashion, you develop momentum, which further motivates, inspires, and energizes you. Soon it becomes automatic and easier.

You can’t control the future, and that’s not the purpose of goal setting. It’s also a recipe for failure to assume that the path to your goal will require suffering and sacrifice. In fact, the whole objective of all steps above is to allow you to avoid stress and suffering, and be more fully motivated by your progress.

As you adopt a goal-setting mindset, you will find yourself setting different kinds of goals. These are lifetime goals, not just a collection of near-term objectives. It’s these really big objectives, that seem unachievable even to you right now, that will inspire you the most, and motivate you to real success and happiness.

Marty Zwilling

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Saturday, November 17, 2018

6 Steps To Providing Exceptional Customer Experiences

happy-customersFor decades, efforts to satisfy customers have been built around demographics – capitalizing on race, ethnicity, gender, income, and other attributes. Today, in this age of pervasive social media and two-way communication, the focus needs to get beyond demographics into personalities. Customer personalities define customer experience, and sets what they love, and what they hate.

Even businesses with highly specialized market segments will find it more effective and simpler to focus on who customers are as people, rather than the “what” of their demographic attributes. Customers today expect highly personalized and exceptional experiences to stay loyal and become advocates, rather than just conventionally “satisfied.” Satisfied is far from memorable.

The challenge for every entrepreneur and every business is to understand the pragmatics of identifying and reacting to what their customers love and what they hate. I found some excellent guidance on the specifics in the classic book, “What Customers Crave,” by Nicholas J. Webb. As a popular strategist in the areas of customer experience design and innovation, Webb knows.

He outlines six key steps in your journey from yesterday’s customer service to today’s required delivery of exceptional customer experiences:

  1. Define the whole customer experience versus service. Traditional customer service, focused on fixing bad transactions, is too little, too late. The total customer experience includes identifying with your company culture, the shopping experience, the customer-facing team and social media interaction, as well as resolution of any transaction glitches.

  2. Add the extra mile to make the experience exceptional. There is no one set of exceptional experiences that will work for all customers. That’s where you must know the personalities of your customers, to know what they love and what they hate. Ideally, you need to convince each customer that you have personalized the experience just for them.

  3. Display real customer value feedback versus value claims. Customers react poorly when they hear your value claims for them, and see more value to you (bottled water in your hotel room at a high price as a “convenience” to you). Customer value statements must come from customer feedback to other customers, rather than from your marketing.

  4. Build blended digital and non-digital experiences. Some businesses excel in customer-facing people, but have poor digital interfaces for feedback, shopping, or communication. Others have delivery silos, where one fragmented deficiency can override all other positives. Integrate and blend all elements of your customer experience.

  5. Train customer-facing team to collaborate with customers. Internal training and policies are not adequate to create great customer experiences. Employees must learn to develop relationships with real customers, and engage these customers to understand what each customer expects, and how to get customers to engage other customers.

  6. Assure exceptional commitment within your customer-facing team. Commitment means signing up willingly, showing up mentally, standing up for the customer, and never ever giving up. To get this, you need to find the best people for each role, give them the latitude to do their job, and reward them publicly and privately for achieving results.

Many business leaders still believe that exceptional experiences cost too much, and reduce profit margins and growth. In fact, just the opposite is true today, since more and more customers expect good feedback from others before they consider you, and decline to return if they don’t get a great first experience. The result is that an average business can spiral quickly into the ground.

If you are looking for a lasting competitive advantage, I recommend that you follow the steps outlined here to create experiences that your customers crave. It’s not only good for your business, but it will add meaning and joy to your customers, and will also enhance your personal satisfaction and well-being. That’s a win-win-win opportunity you can’t afford to miss.

Marty Zwilling

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Friday, November 16, 2018

5 Tips For Making Your Whole Team A Marketing Machine

marketing-teamAs the rate of change continues to increase in business and technology, the more I’m convinced that marketing is the primary key to success for a new venture. Yet I find that many technical founders don’t feel they need it at all, or at best point to one person on the team who is marketing. I believe the real challenge is make your whole team a marketing machine.

That doesn’t mean that everyone needs to participate in creating the typical marketing hype, or needs to face the press on a regular basis. It does mean that everyone on the team, from you the founder to your most introverted developer, needs to really understand and believe in the product and strategy, and when asked, doesn’t hesitate to be an advocate for you and the business.

For example, as a member of an angel investment group, I sometimes do some “due diligence” on promising startups looking for funding. A common part of this process is to visit with members of the team to check team dynamics, skill level, and commitment. Unfortunately, I often find team members who are not believers, or have a different view of the customer. The result is no deal.

Thus you need to understand how quickly anyone on your team can be the key to attracting a new set of customers, or the reason that critical partners, vendors, investors, or customers walk away. Fortunately, I’ve found that it isn’t really that hard to make every member of your team a marketer for your new venture, by focusing on the following priorities every day:

  1. Build a culture of trust, confidence, and pride in your business. This has to start with selecting the right partners, and hiring people who believe in you and your business. Too many founders, strapped for cash or time, make poor team selections, assuming they can fix the problem later. Your team is your business, and you can’t sell without them.

    Team members who feel they have a voice and a strategic role are happy and proud to be advocates for your business. You need them not only to close business, but also to keep internal productivity and motivation high, and to use their own social media and friends to spread the word. It helps to celebrate small wins, together and often.

  2. Encourage and require outside engagement and feedback. You set the tone when you schedule and hold regular “all-hands meetings” to provide updates on progress and recognize participation of others in outside events. It helps to provide everyone with business cards, a current copy of investor presentations, and strategy details.

    I find that startups who do this are much more likely to stay ahead of the game, by proactive innovation, keeping up with customer trends, and being viewed as a leader in their community. In this days of pervasive communication, this is powerful marketing.

  3. Facilitate participation in industry conferences and networking. Team members need your support in keeping up with peers outside the company, and related industry developments. Their relationships with industry experts and even competitors can be a key marketing boost to your brand and business, or a disaster if not done positively.

    Thus, when you participate in trade shows and conferences, staff the booth from development and other organizations, as well as marketing. Make sure all team members are included or considered for standards organizations and customer briefings, so they know what is going on and have opportunities for relationships with real customers.

  4. Provide cross-functional mentoring and coaching. I have found that even the most dedicated developer can benefit from a formal opportunity to talk to your key marketing guru, and vice versa. Everyone learns from these sessions, and your business will benefit from the input. Another approach is putting people on temporary assignments for growth.

    These sessions also facilitate career advancement, with a better understanding of the skills and experience required to move into marketing or finance. Everyone loves a no-risk approach to testing their ability to advance into new areas of the business.

  5. Recognize and reward “marketing” efforts and results. Team members who see others outside the marketing staff rewarded for their efforts will be motivated to participate. Opportunities include anyone bringing in a new customer, sharing the load in a social media campaign, or representing the company for a good social cause.

    All this doesn’t require a large increase in the marketing budget, since peer and public recognition by you is often more important than money. In addition, the opportunity to work on social and environmental causes of personal interest generates great loyalty.

The most effective teams are the ones who feel a common responsibility for the success of the business, and are willing to reach out and contribute to all elements of the business. This develops leaders at all levels, and these emergent leaders are not hesitant to take ownership when they see business growth opportunities, thus multiplying your impact and marketing.

Marty Zwilling

*** First published on CayenneConsulting on 11/05/2018 ***

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Wednesday, November 14, 2018

7 Skills Every Startup Team Needs To Get Things Done

getting-things-doneIsn’t it amazing that some people you know always seem to be working hard, but never seem to get anything done? As an entrepreneur, you need to avoid partnering with these people, or hiring them into your startup. The challenge is to find people who get things done, as well as work hard. LinkedIn profiles and resumes still focus too much on responsibilities rather than results.

The best entrepreneurs never confuse motion with results. It’s easy to find people in every organization rushing around from one meeting to the next, often working overtime to generate more work for themselves and other people, but rarely taking the action to close an issue or contract. We all need more people around us who make every motion mean something.

So how do you recognize those few people on your team who are getting things done, or even recognize ahead of time those who have that potential? Such people are different, but are not necessarily the smartest or the most skilled. But they do seem to have some common characteristics and approaches that you can look for:

  1. Possess street smarts, as well as skills and experience. People like this quickly figure out how businesses really work, and how to resolve the challenges in their business. They have a special ability to cut through the confusion, dodge any head-on collisions, and negotiate compromises leading to required actions and resolution.

  2. Able to avoid or navigate the politics of the organization. Understanding politics is not the same as being a politician, or using political clout. People who get things done don’t worry about building their own image, but they are politically astute enough find alternate routes around the political and power bastions.

  3. Recognize what it takes to get power leverage, but don’t blatantly use it. The key is to be open and listen to recommendations from those who have to be moved, and find a way to create win-win situations, rather than win-lose. They get things done by using their power to get recognition for key players, rather than for themselves.

  4. Maintain a laser focus on narrowing the scope, rather than expanding it. This means effective negotiating to eliminate sidetracks, combat opinions with facts, and finding the glass half-full, not half-empty. It requires being able to accurately assess the position of others, find some common ground, and snapping people back to reality.

  5. Able to negotiate agreements without committing to future paybacks. People who get things done are driven by an insatiable desire to make progress and help others. They are not looking to build a cache of favors or special attention, and are not willing to make deals that compromise the solutions and can come back to haunt them.

  6. See every problem as an opportunity to innovate, rather than a chance to fail. Obstacles are seen as innovative and creative challenges, not barriers. All the reasons something can’t be done are replaced by better ways to get it done, quicker and at less cost. Nothing is immutable, even the culture of the organization or the business.

  7. Able to balance the paradoxes of highly effective leaders. People who know how to get things done can be analytical as well as intuitive, aggressive or patient as required, and confident and humble at the same time. They instinctively know when and how to escalate issues to the right level, without stubbornly entrenching their position.

To get things done more effectively, people need to really think about each element of their work before they make a move. By culture and habit, many of us expect most of our daily work and personal activities to be pre-defined, and we just go through the paces (the way it’s always been done). We need to practice overt thinking about desired outcomes, to make them a reality.

If your desired outcome is to move up in the organization, or just to get more satisfaction from your daily efforts, now is the time focus on the attributes listed above, and emulate the people on your team who get things done. If you are the entrepreneur or executive in the organization, make sure you are the role model in execution and in hiring. That’s the only way to win in the long run.

Marty Zwilling

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Monday, November 12, 2018

5 Strategy Realities For Running Your Small Business

whiteboard-strategyAs an advisor and mentor for many startups and small business founders, following my initial career in big business, I realize that the key strategies to achieve success in small businesses are often different from those that make larger businesses successful. The primary difference is the amount of time you have to spend working in the business versus on the business.

Small business owners have to do both, and split their time carefully between the two. Big business executives have the luxury of spending all their time working on the business, while delegating the operational tasks to other people and processes already in place to handle these. Continuing to micromanage both as your business grows is the downfall of many entrepreneurs.

I found this challenge and others outlined well in a new book, “Running Your Small Business Like a Pro,” by Andrew Frazier, who also brings many years of working with big and small companies. He recommends some key techniques, learned by both of us the hard way, that every small business owner can and must deploy to achieve long-term sustainability and growth:

  1. Must be more creative and flexible to compete effectively. With a tiny organization, small businesses can make decisions quickly, allowing them to respond quickly to customer input and changes. Sharing the same space also facilitates creativity. Big companies become divided up into silos, and often fail to collaborate or communicate.

    For example, in the sales silo of my former organization, it was common to point to marketing or development as the source of a sales issue, but communication across to these organizations took forever, and agreeing on a common solution was difficult.

  2. Must learn to grow beyond initial traction and survival. As a small business owner and entrepreneur, you may relish the flexibility and the challenge of getting that first traction and customer recognition. But continued growth requires a focus on staffing, more collaboration, and formalizing processes to meet the rising transaction volume.

    I was recently an advisor to a very smart entrepreneur who insisted on getting personally involved in closing every sale, as well as every new feature development. The result was a growth plateau, as well as entrepreneur health and family balance challenges. He refused to begin working primarily on the business, rather than primarily in it.

  3. Small businesses need to create automated processes. A successful business has many components, including sales, marketing, finance, and operations, and these need automated interaction rules and leaders, so that you don’t have to the glue. If you find yourself getting calls at all hours on the same issues, the business is running you.

    One solution here is to hire help rather than helpers. Helpers do only what you tell them, whereas true help comes from people who know more than you in their specific area, such as sales or finance. You can delegate to them, and you learn from them over time.

  4. Find a coach who has a holistic view of all elements. Big companies are in a position to benefit from experts or consultants who focus on a given function. Small businesses, on the other hand, more often need advisors on the overall strategy, funding, and the integration of individual components. The solution here is more likely peers than experts.

    For example, there are several entrepreneur community networks, like EO and TiE, which offer education, mentorship, and peer networking for new business owners in the early growth stage of their business. Match your advisors with your business stage.

  5. Surround yourself with people with complementary skills. As a small business owner, you have a broad range of responsibilities, and none of us can be experts in all. Therefore, it important to find people who can fill in the gaps we have, perhaps in finance or marketing. In big business, you can use multiple people with more skill depth.

    Too many entrepreneurs I know tend to hire people like themselves, to provide the positive feedback they crave, but can’t help them fill in skill gaps. Of course, all of us need to continually be in learn mode, as the business world in changing around us.

Going forward, the economy and competition will continue to become more challenging for small business owners, and hopefully your small company will grow into the ranks of the larger successful ones. Thus the more you learn about and use the right strategies at every level, the better prepared you will be to rise above the crowd now, and in the future.

Marty Zwilling

*** First published on Inc.com on 10/29/2018 ***

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Sunday, November 11, 2018

Shortcuts For Simplifying How To Think, Act, and Lead

How-to-think-act-leadThe cost of entry to the entrepreneur lifestyle is at an all-time low, but the challenge of winning and success is at an all-time high. Anyone can build a new web site, or publish a smartphone app for a few thousand dollars, but getting market penetration requires a lot more. Customers have come to expect disruptive change, so yet another social network is not the way to get traction.

As an angel investor, I quickly look behind the idea or solution, to gauge the mindset and the leadership capabilities of the entrepreneur. That’s why the book, “The Leader’s Mindset: How to Win In The Age Of Disruption,” resonated strongly with me. It was written by Terence Mauri, who has worked extensively with Sir Richard Branson and the London Business School.

Mauri offers some practical, actionable advice for entrepreneurs who want to develop a leader’s mindset, on how to spread the right message to potential customers, as well as investors. He outlines three shortcuts for simplifying how we think, how we act, and ultimately how we lead, which I have paraphrased and amplified here:

  1. Expand your mindset to think better by a factor of ten. Most entrepreneurs think about how they can improve cost or usability by ten or twenty percent. When was the last time you set a challenge for your team that pushed all of you to deliver more than you thought was humanly possible? People who shape the future, like Steve Jobs, do this.

  2. Push your mindset to tackle the seemingly insurmountable. A bold mindset excels at speed, creativity, and decisive action. Entrepreneurs in this category are real risk takers, such as Elon Musk. He recommends imagining creative solutions to a problem to “cut through the noise and focus on the signal.” Take a hard look at SpaceX or HyperLoop.

  3. Develop a learn-fast mindset to seek the latest and the future. Those who proactively seek knowledge and learn fast build knowledge pools and tap into the wisdom of mentors and industry leaders to raise their game. For them, adapting and stretching their limits is the norm. They learn from their mistakes, and collaborate with well-connected people.

Leadership on ideas is a start, but entrepreneurial leadership requires the ability to deliver on the new reality as well. The best entrepreneurs relish the opportunity to overcome the personal and team obstacles that come with every team contemplating disruptive change, including the following:

  • Fear of failure, fear of the unknown, procrastination, and doubt. All these fears can cause flight-fight, freeze behaviors, or a hasty retreat from dreams, goals, and plans for disruptive change. Fear keeps your mindset locked in a state of helplessness and will stop you from reaching your goals.
  • Constrained by talent shortages and lack of commitment. A key requirement for every disruptive entrepreneur is to fuel the organization’s growth by attracting and nurturing the best and most committed talent. The best leaders find a team and every individual unique strength to do great work and make a difference beyond chasing profit.
  • Dragged down by excuses, inertia, and negative energy. A top priority of all entrepreneur leaders is to avoid falling victim to “somebody else’s problem (SEP).” Lack of accountability is a mindset that is diametrically opposed to the required leader’s mindset. Don’t let this contamination infect you, your team, or your disruptive venture.

Overall, the leader’s mindset begins with zero compromise on purpose. It demands that you believe in what you are doing from the heart, and that your contribution is essential to the future world you envision. This must be matched with the intellectual courage to change business models multiple times to remain viable, based on real-time feedback from the market.

Becoming an entrepreneur is easy, but winning is still tough. Do you have the leader’s mindset required to compete and win?

Marty Zwilling

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Saturday, November 10, 2018

Early Adopters Are Not Enough To Assure Your Success

crossing-the-chasmEvery technical entrepreneur is an early adopter of technology, so naturally they build things with people like themselves in mind. Unfortunately, for most solution markets, early adopters represent only 10 to 15 percent of the total opportunity, so it’s easy to get mislead on the real requirements of mainstream customers. Psychologists call this the confirmation bias. I call it failing by early adopters.

The good news is that early adopters are never reluctant to sign up as beta customers and will provide you early feedback on product quality. The bad news is that they are not a good test of basic usability and ease of operation, which are always a key to the much larger market of regular customers. Consider the long market acceptance struggle of digital wallets and home automation.

Listening too much to early adopters often leads to an expensive death spiral, since these users will request more and more features, more precise control of the technology, and more interoperability, all of which increase the complexity of the product, and decrease the usability for the average customer. The result is a bigger and bigger chasm to cross to your real market.

Many in the business world has heard of the old bestseller by Geoffrey A. Moore, “Crossing the Chasm,” but most entrepreneurs don’t realize how much it relates to them. In fact, it’s all about understanding the differences between early adopters and mainstream customers, and managing your own marketing and development efforts to cross this deadly chasm.

Here are the critical points that you must understand for optimal product management and marketing to maximize results from early adopters, as well as maximize your opportunity from the mainstream later adopters as well:

  1. Collect feedback across the total range of customers. Early adopters may be the most vocal, and easy to sign up, but your technology assessment panel must include customers from the early majority, late majority, and even technology laggards. These last three groups usually comprise up to 85 percent of your real market.

  2. Usability features are as important as function. Features you designed for non-technical users, including wizards for setup, dashboards for overview operation, and simple buttons for complex processes, will get little or no feedback from early adopters. They will request and be more vocal about technically tricky and elegant features.

  3. Eliminate interface complexity and clutter. Early adopters are not intimidated by dense user interfaces, with more options to control the technology, and the flexibility to do almost anything. Regular users like to see more white space, and are more impressed with the Amazon patented one-click-buy button, to complete a purchase in one click.

  4. Balance your focus on engineering elegance. Many technical entrepreneurs continue to “tune” the system, and add new parameters for users to worry about, simply because they can. At some point, this becomes compulsive engineering, and the tradeoffs in time to market, cost, and user friendliness move the product out of the intended market.

  5. Early adopters are cool, so you need them to kick-start word-of-mouth. You certainly can’t afford to ignore early adopters, or antagonize them. They are your early opinion leaders, so they are required to build the image that the rest will follow. The challenge is to attract them with an innovative solution built on great technology, while still keeping it usable, timely, and cost effective for the rest of us.

Early adopters are a critical but small market segment that must be treated with respect. They can be your best evangelists or your biggest critics at that critical point when you are crossing the chasm to the larger mainstream customer segment.

But don’t ever be become complacent due to excitement and passion from your early adopters. You still need the same reaction from your other market segments, and an appropriate marketing strategy for scaling the business into other segments. Ten percent of even a large opportunity can still leave you in the valley of death, rather than the pinnacle of success.

Marty Zwilling

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Friday, November 9, 2018

8 Keys To Market Delivery Of Innovative Technologies

Samsung-virtual-reality-innovationSince I am a techie at heart, I always get excited when founders pitch their new innovation as “disruptive,” meaning that it is so unique that it will create a new market and disrupt the existing value network, displacing established products and markets. Unfortunately, I have learned that investors and customers are wary that big changes will take a long time, and cost more money.

Therefore I always recommend to entrepreneurs that they use the term cautiously, but I never discourage their focus on disruptive innovation. In fact, in the greater scheme of things, it’s the best way to gain a real competitive advantage, and maximize economic value. Linear thinking is a good way get started as an entrepreneur, but paradigm shifts are the route to a big legacy.

As examples, everyone should be able to relate to Steve Jobs with the iPhone, Mark Zuckerberg with Facebook, and Elon Musk with Tesla. These didn’t happen by following the conventional paths of entrepreneurism. In my experience, you need to follow some best-of-breed guidelines that will keep you ahead of the crowd, and improve your odds of success in making the big step:

  1. Focus first on solving a real customer problem. Business success always relates to how effectively you satisfy customer needs. Big technology breakthroughs don’t always correlate directly to the mind of customers, so your challenge is the translation. Investors and customers want to see how these become a positive value proposition for all parties.

  2. Take advantage of big data and modern design tools. Passion is a good start, but there is no substitute these days for real data and powerful tools to confirm the value and quality of specific features and customer trends. Your goal is to minimize the delivery cycle, and reduce the number of pivots required to find the sweet spot of your market.

  3. Find a way to highlight elements of social responsibility. New markets are often found as a result of culture changes, new economic realities, and emerging geographies. People want to help build a sustainable environment, and improve the well-being of others. Make that a way to bridge a big technology change to customers and employees.

  4. Assemble a team willing to think and act outside the box. A new technology usually needs a business model that is also a paradigm shift. Make sure your whole team is willing to take risks and explore new options on pricing, marketing, and manufacturing. Your challenge is to provide the visionary leadership to stay ahead of the pack.

  5. Exploit disruptive opportunities all along the value chain. Key elements of the value chain include distribution, suppliers, sales channels, and reliance on coopetition. New technologies often allow innovative marketplace entrants to eliminate whole stages of the value chain, for example dramatically reducing capital and infrastructure costs.

  6. Continually expand your team competency into new areas. Nokia had a deep competency in cell phone technology, and owned a major share of the market, but they were slow to expand into the software and accessories of smartphones. As a result, Apple was able to leapfrog their lead, and Nokia was never able to recover.

  7. Plan on disrupting yourself before competitors do. Cash cows can be your downfall in this rapidly changing world. You need to constantly attack your own existing business model, and plan to replace it before customers start looking at better alternatives, and competitors leapfrog your solutions. It’s hard to recover from a hemorrhaging business.

  8. Look around the corner for the next real breakthrough. A single disruptive technology is not enough to assure your long-term success. You need visionary leadership, as well as a culture and process for finding the next big step, recruiting the people, incenting them, and training them to make it happen.

Linear non-disruptive thinking may be the way to get started as an entrepreneur, but it won’t get you the big success or the legacy that you crave. Your challenge is to think big, communicate effectively to avoid scaring customers and investors, and follow the best of breed guidelines to deliver on a timely and ongoing basis. It’s a lot more fun than a random walk based on a dream.

Marty Zwilling

*** First published on CayenneConsulting on 10/25/2018 ***

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Wednesday, November 7, 2018

5 Market Obstacles That Kill Even Compelling Products

fear-of-changeEven when your new product or solution fills a real customer need, and has a positive value proposition, many new venture founders are surprised and frustrated to find that excited customers are hard to find and growth is slow.

Thus, as an advisor to many startups, without being negative, I often spend hours with them brainstorming on all the possible barriers that may slow adoption rates, and how to plan or modify the business model to work around these obstacles.

For example, the software-as-a-service (SAAS) subscription model was created many years ago to offset the high one-time purchase cost obstacle that killed many early software products. Since then, the monthly subscription model has become the norm for a wide range of products and services, from web applications, to hardware, and services of all types.

Other obstacles to product adoption are equally onerous, but not so obvious, and in some cases, there are no easy solutions. Still it’s better to be forewarned than to be caught off guard, with no Plan B or resources to pivot. Here is my prioritized list of the top challenges I see today, with some recommendations on how to offset them:

  1. Customers don’t know your product exists. In today’s crush of over 140,000 new websites per day worldwide, it’s easy to be overlooked, no matter how compelling your offering. My answer is that innovative marketing is always required, to stand out above the crowd. Word-of-mouth is great, but I look for a real marketing budget and action plan.

    As a starting point, I would expect to see a marketing budget in the first year of 15 to 30 percent of projected revenues. The plan better include some specifics on how this will be spread across multiple digital and traditional marketing channels, and metrics to measure which are providing the best return on investment.

  2. They know you exist, but any change is painful. Your challenge here is first to convince potential customers that your solution alleviates a higher level of existing pain, via quantified cost reduction, improved productivity, or other value. Fuzzy marketing terms like “easier to use,” “nice to have,” and “less expensive” won’t help your case.

    I recommend realistic examples of cost savings and return-on-investment testimonials from early users. In my experience, single digit cost reductions are usually not enough to incent users to change tools or vendors. In all cases, make the change simple and fun.

  3. Product is “disruptive technology” or a “paradigm shift.” These are terms often used by technical entrepreneurs to convince investors and customers that their solution is so innovative that it will disrupt the market or define a new category. My advice is to use these terms very sparingly, since they invoke more fear than value to normal people.

    The best strategy with real customers is to focus on the simplicity and value of your offerings, rather than the technical complexities. Steve Jobs was a master at this, and was able to establish a whole new market for smartphones by keeping his focus on positive human factors.

  4. Requires infrastructure or regulatory changes. Your product may have tremendous customer value, but the market may be stymied by forces that move slowly, and are somewhat outside your control. For example, the move to self-driving vehicles raises many issues about liability, new laws required, and infrastructure changes.

    Here, you first have to face the fact that more time and money will likely be required, for exhaustive public education and demonstrations, lobbying for regulatory changes, and incenting infrastructure growth. Identify interim growth steps to mitigate the cost and risk.

  5. Customer buying decision process is multi-level or complex. Selling products to education organizations, or the government, is never simple. Decisions are impacted by budget cycles, multiple approvals required, and political issues, no matter how strong the value proposition. Here I look for a plan that shows marketing at all the required levels.

    Sometimes the solution is to change the target customer. For example, several education product providers I know have switched to selling to parents, rather than school boards. Others, selling scheduled home maintenance, have shifted away from less-caring homeowners to insurance companies, who see the savings in reduced claims.

Based on my experience, inadequate attention to acceptance obstacles and the realities of customer motivation are the primary reasons that startups fail, even with a great idea and a great product. Innovative solutions alone won’t make a business. You have to find and convince the right customers – they won’t automatically find you just because you have a great solution.

Marty Zwilling

*** First published on Inc.com on 10/24/2018 ***

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Monday, November 5, 2018

Apply Hospitality-Driven Thinking to Your New Venture

Hotelschool_The_HagueI just finished a new book by Stephen J. Cloobeck, “Checking In: Hospitality-Driven Thinking, Business, and You”. As a self-made entrepreneur and former chairman of Diamond Resorts International, he asserts that the five biggest companies by market value today, Google, Facebook, Microsoft, Amazon, and Apple, aren’t really tech, but hospitality companies.

Tech may be the tool, but hospitality – making life a little easier, more comfortable, and more enjoyable for your customer, is the winning focus.

Unfortunately, too many of the technical entrepreneurs I mentor and advise are focused on their technology, and assume that the value will be self-evident to customers. They don’t do the translation from technology to customer comfort in their marketing, and they don’t constantly check to make sure that every interaction results in a memorable customer experience.

The keys to doing this well, for tech and non-tech businesses, are highlighted in his book, and he offers the following five lessons from hospitality to all entrepreneurs:

  1. Priority at every business stage on the customer. Rather than leave your customer focus at the delivery stage, and technology in the front, customer needs and expectations must be the beginning of your journey via requirements, and remembered all along the way in times of crisis and confusion, competition, growth, failure, and success.

    For example, as a potential investor, I regularly see business plans that lead with pages on the technology, and only abstractly relate to customer value and improving the total customer experience. Voice recognition and artificial intelligence are great technologies, but very few customers today can tell you how these make their life more enjoyable.

  2. Commit to continuous improvement. Customer needs and expectations are changing faster than ever these days. If you can’t anticipate and pivot to match these changes, to the extent of obsoleting your own offerings, competitors will step in and customers will leave, never to return. Improve the whole customer experience, as well as the product.

    Back in 1999, Amazon patented a feature and changed their own process and on-line commerce forever: One-click purchasing, versus re-entering name, address, and credit card information for every transaction. Who knows how many real impulse buys were committed and new customers were attracted thanks to this innovation?

  3. Focus on reputation over brand. Prioritizing reputation over brand means you care more about what others think of you than what you have to say about yourself. It forces you to prioritize the health of your organization from the inside out. It means you are listening to, and learning from, your customers, stakeholders, and what critics say.

    United Airlines, with a great brand name, found this out the hard way a few years ago when the airlines smashed a songwriter’s guitar and refused to reimburse him. He got even by going viral, so easy to do these days, costing shareholders perhaps $180 million.

  4. Ensure total alignment of all elements of your business. With every venture now worldwide, in terms of customer base, service delivery, and supply chain, the challenge is to maintain the same customer experience, while adapting to different people, places, and events. All team members must share the same mission, vision or core values.

    This requires that you recruit the best talent, train to your best, and motivate so team members all perform at their best. Break traditional management hierarchies, and build a level of trust and responsibility at all levels.

  5. Do well by doing good for others as well as yourself. Be a role model for your team in helping customers and others, to demonstrate the kind of person you want everyone to be, and create the kind of world you want to live in. Add a social value giveback, or highlight your positive impact on the environment, to increase customer delight.

Apple, for example, recently reported the use of 100% renewable energy in powering its global facilities – the first major technology company to declare and fulfill such a commitment. Google places such a premium of employee happiness, with perks and benefits, that it is regularly recognized as one of the best places to work in America.

Although these principles were derived from executive experience and success in the hospitality industry, I have easily expanded their scope to technology, and I believe these apply to every new venture. Thus I agree that in the focus on customers and employees, every entrepreneur can and should take lessons from the hospitality business.

Marty Zwilling

*** First published on Inc.com on 10/22/2018 ***

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Sunday, November 4, 2018

Boost Your New Venture By Teaming With An Incubator

business-incubator-acceleratorOne of the reasons that now is the time to be an entrepreneur is the explosion of startup assistance organizations, usually called incubators or accelerators. According to the International Business Innovation Association (InBIA ), there are over 2,200 of these locations worldwide, and new online versions springing up all over the place, like Founders Space in Silicon Valley.

Most of these are non-profits, set up by a university to commercialize new technologies, or a municipality to foster business development for the local economy. A few are still trying to make a profitable business out of nurturing startups, but it’s a challenge to make money when your customer startups don’t have many resources to give.

But there are notable examples of for-profit incubators that are thriving, including YCombinator, led by Paul Graham in Silicon Valley, and TechStars, led by David Cohen and located in several key cities around the country, that have an excellent reputation and track record. I believe their competitive advantage is their top on-site leadership, exclusivity, and connections to investors.

Variations on the incubator theme are sometimes called business accelerators, science parks, or the Small Business Administration's Small Business Development Centers (SBDCs) in almost every state in the U.S. Accelerators generally accept startups at a slightly later stage, and attempt to compress the timeline to commercialization into a few months, instead of a year or more.

Common resources provided by most of the incubators and accelerators today include the following:

  • Access to shared office facilities for multiple startup teams at a very low cost.
  • Shared business support services, including telephone answering, conference rooms, teleconferencing, administrative support, and a business mailing address.
  • Mentoring and technical assistance from volunteer or paid experts.
  • Direct seed funding, for a share of the equity, and introductions to investors.
  • Peer-to-peer networking with other startups and founders in the same stage.
  • Health, life, and other insurance at group rates.

If you don’t need these common resources, but need specialized technology services, you should look for technology parks and research facilities, often sponsored by leading companies in specific technologies, like Intel Capital and Google Ventures (GV). As well, these companies usually bring real new venture funding opportunities to the startups they sponsor.

To get started, go to the International Business Innovation Association web site, and use the lookup tool provided to see what’s available in your area. This association is definitely one of the world’s leading organization for advancing business incubation and entrepreneurship. Another good online approach is a simple Internet search for articles like the “The top 40 startup accelerators and incubators in North America in 2018

But don’t expect incubators to magically convert your pre-hatched idea into a successful company. The good incubators are highly selective, and expect you to demonstrate your commitment and a hard work ethic to meet expected milestones and show continuous progress. According to some recent feedback, YCombinator takes roughly 3 percent of applicants who apply to each batch cycle. Assuming 60 companies are accepted in a specific batch, that would mean around 2000 companies applied. That’s about the same ratio that angel investors claim.

I believe the real value of an incubator is in the relationships you can build there, with peers as well as domain experts, investors, and potential strategic partners. An incubator won’t help you if the market opportunity is small, the competitors are large, or your solution doesn’t address a real need.

As evidence that it does work, VentureBeat calculated last year that YCombinator has funded 1,464 startups since inception and that its alumni are worth a collective $80 billion.. However, if you are looking to find an incubator like YCombinator for easy money and free services to hatch your startup, it probably won’t work.

Growing up and surviving in the entrepreneur world requires a fine balance between an independent determination to be self-sufficient, and a humble willingness and ability to listen to and learn from the best and the brightest startup mother-hens out there. Are you and your startup ready to make the cut?

Marty Zwilling

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Saturday, November 3, 2018

8 Ways To Ensure Team Accountability In Your Startup

team-accountabilityMaybe it’s just me, but I sometimes feel that accountability is a rare talent in business today. In big businesses, people are quick to defer with “that’s not my department,” and even startup founders too often blame failures on the economy or the lack of investors. As an investor and advisor to entrepreneurs, I see accountability, or lack of it, as an override to even the best idea.

I believe accountability is a personal decision that we all can make, largely driven by personal confidence and determination, and is certainly one that we can learn. It’s not baked into our DNA, and there are many resources available to direct improvement.

For example, I found some great guidance to the how, why, and who of accountability in the “QBQ Workbook,” by John G. Miller and Kristin E. Lindeen. Miller is well-known for his classic bestseller on this subject, “QBQ! The Question Behind The Question.” His advice starts with a request to stop blaming, and start asking, “What can I do to improve this situation?”

Very refreshing. If you are an entrepreneur building a new business, there are many things along these lines that you can and must do, including the following:

  1. It’s up to you to be the model of accountability. Don’t expect your team to be accountable, if they often hear you complaining about the workload, competitors, or partners. Accountability is a culture that starts from the top, and is reinforced by your hiring of skilled and positive people, delegating responsibility, and rewarding results.

  2. Clarify and constantly reinforce expectations. Team members can’t be accountable unless they know what is expected of them, and they understand how to deliver. Communication must be ongoing, both written and spoken, followed by some active listening on your part, to understand the gaps. Remove the “I didn’t know” excuse.

  3. Set measurable goals and objectives, with benchmarks. Accountability assessments must be based on objective facts, not opinions, politics, or a desire for power. Setting expectations beyond the realm of possibility, or frequently changing them, does not lead to accountability. Provide the tools for team members to measure their own results.

  4. Align individual responsibilities with relevant business goals. Team accountability must be correlated to responsibility and relevancy. You can’t hold your sales team accountable for manufacturing quality, but they should be responsible for profitability and volume. When expectations are aligned with motivation and interests, everyone wins.

  5. Truly delegate responsibility and decisions. Accountability can’t happen without control. If your management style is to make all the decisions yourself, don’t expect any accountability from your team. If you find yourself buried in work, with no time off, and feeling indispensable, it may be time to ask direct reports to call you out on delegation.

  6. Accountable teams need timely and actionable feedback. Getting to the source of problems should never involve blame. Accountable people need safe havens where challenges and performance can be discussed, individually and as a group. The goal must be continuous improvement and learning, not accusations and penalties.

  7. Provide resources and training to enable accountability. Tools and data are necessary for accountability, but must not be allowed to be the absolute determinant of a response. Provide the tools, but trust the people. Other necessary resources include training, reasonable financial leeway, mentoring, and access to relevant executives.

  8. Accountability requires consequences, both positive and negative. People who demonstrate accountability must be rewarded (awards, acknowledgement, promotion). In the same context, team members who consistently make excuses must be moved out of the organization to minimize the impact on others. No consequences mean no learning.

The best part about a focus on accountability is that it leads to real change, learning, and action, and these are the keys to entrepreneurial survival. When a business stops changing and learning in today’s fast-moving world, it stops growing and thriving. Every business is really a set of people. Are you growing and thriving?

Marty Zwilling

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Friday, November 2, 2018

8 Key Elements To Make Your Social Venture Profitable

socially-conscious-startupI applaud the resurgence of a focus by new ventures on saving the environment and having a positive social impact. Yet, when you are pitching to investors, this has to be balanced by generating enough profit to keep the venture thriving, growing, and providing a healthy return-on-investment (ROI) to investors. Founders who avoid the use of the term “profit” had better have deep pockets of their own.

Zappos, impressively, has given away 26 million pairs of shoes in 127 countries and all 50 states. However, that wasn’t the main reason they were acquired by Amazon for $1.2 billion a few years ago. It probably had more to do with the fact that they had doubled their sales annually for several years, and still managed to squeeze out a profit of $11M in their year of acquisition.

Without profit, there is no longevity to any business, so I’m always surprised when sincere young entrepreneurs avoid using the term, as if “profit” is a bad word. At the other extreme, I don’t condone greedy and unethical business practices to unjustly shake down customers and employees alike. As an investor myself, I look for a balanced story focused on the major elements that drive profitability, including the following:

  1. A 5-year financial forecast achieving a positive cash flow early. Every entrepreneur, and every investor, needs targets and a conviction that your business will be sustainable, and will provide a return-on-investment (ROI) to all constituents. If you have not done the work to derive rational numbers, or you are unwilling to commit, no investor will help you.

  2. Shows positive value for both the customer and the business. Customers and investors are looking for quantifiable specifics, not just social value or “eco-friendly.” They are looking for solutions that will reduce their costs by 20%, or double productivity, or cut traffic accidents by a third. Evidence in the form of data is important here.

  3. Targets a major demographic segment with money. Solving social problems, like feeding the hungry, is great and may heighten your brand credibility, but customers with money to spend are the key to the survival of your business. Tiny markets may excite your passion but won’t sustain a business or leave you with a long-term positive legacy.

  4. Highlights a sustainable competitive advantage. Social value alone is not normally a sustainable advantage for a startup with limited resources, since big players can jump in with more money to replicate your social value and add more innovation. The best advantage includes intellectual property to provide a barrier to entry or incent acquisition.

  5. Introduces a team with the balanced competencies to deliver. Investors look for a team with business, financial, marketing, and operational skills, as well as a social passion. A lone entrepreneur rarely have this range of talents. For this reason, you often hear investors talk more about investing in the team, rather than the idea.

  6. Employs a profitable business model with customer traction. A winning business model, like Zappos, often benefits social needs as well as business needs. But business models need to be validated by paying customers (beyond free trials) before they are credible. Before customers, traction can also include letters of intent and testimonials.

  7. Includes balanced and hard-hitting marketing and sales. Good deeds and word-of-mouth alone will not get your solution the growth levels you need in this world of information overload and 14K new websites added every day. You need some innovative new approaches, including digital marketing, as well as metrics to measure effectiveness.

  8. Ends with a winning legacy for customers and investors. Constituents look for a long-term strategy of continuing return, normally including an initial public offering (IPO) or merger/acquisition, to on-going value or option to cash out. A huge user base may also be a source of profitability, if it results in a multi-billion dollar valuation.

Some entrepreneurs argue that recent business successes through free product and user growth alone, pioneered by Facebook, show that revenue and profit are no longer needed. Such an approach is possible, but still relatively rare, and it requires more cash than most investors are willing to risk. Facebook, for example, invested nearly $350 million before turning cash-flow positive.

Therefore, I recommend that a plan for profitability be part of your new venture story, and that positive social and environmental impacts be part of your marketing plan to get there, rather than a substitute for profit. Overall, you need a balanced and complete story to attract customers, as well as investors. It’s hard to leave a lasting legacy if you never get out of the starting blocks.

Marty Zwilling

*** First published on CayenneConsulting on 10/19/2018 ***

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Wednesday, October 31, 2018

Make Yourself A Key Sustainable Competitive Advantage

businessman-competitive-advantageThe most successful entrepreneurs and business owners I know are humble, and they don’t have an inflated sense of self. When you have some success behind you as a manager, executive, founder, or CEO, it’s easy to become less open to the advice and signals around you, and believe you should just continue doing what you are doing to keep climbing. It’s a recipe for disaster.

The only “sustainable competitive advantage” in business is self-awareness. I was struck by this assertion in a new book, “The Messy Middle,” by Scott Belsky, who has spent more than a decade leading in the worlds of technology, design, and startups. I come from the same world, with an additional decade advising entrepreneurs, and I enthusiastically confirm his view.

We both have found that the “messy middle,” with its ups and downs, is the hardest and most crucial part of any bold venture, and that’s where you need to come to grips with your true self. Here are some key points for benchmarking your own sense of self, and the self-awareness of those around you, with a bit of guidance on how to get to the next level and capitalize on it:

  1. At a peak or valley, you are not your greatest self. When things are going well, ego can get the best of you. When times are tough, insecurities normally run rampant. Maintaining a realistic perspective is your promise or peril. Effective advisors and boards are most helpful in these times, when the tough questions are less apparent but critical.

    Most successful business leaders, including Richard Branson and Bill Gates, regularly called on their mentors, Freddie Laker and Warren Buffett, to test their perception of the right questions to ask, and the right issues to tackle.

  2. Understand your feelings to recognize what bothers you. Whatever triggers your frustration or irritates you is rooted in the core value you haves, something you strongly stand for or against. For example, one of my core values is timeliness for completed work and meetings, so I may judge people and results harshly when they violate my limits.

    But now that I have made myself aware of this tendency, I can mitigate my quick judgment to recognize valid delays, and look at results for their real value.

  3. The less defensive you are, the more potential you have. Being open-minded while receiving constructive feedback is challenging. Do you immediately try to explain yourself, go on the offensive, or try to avoid conflict at all costs? Self-awareness helps you achieve balance between these tendencies, and be open to insights from others.

    For example, I once worked for a startup CEO who desperately needed money from a venture capitalist, but became totally defensive when the VC suggested that my CEO might be better in the chief marketing role, in favor of a more experienced CEO. The result was a broken deal, and ultimately a failed startup, instead of a win-win business.

  4. Understand the sources of your own negative tendencies. The leaders I admire most have invested a great deal of time understanding their own psychology and learning from their past patterns and difficulties. They don’t hesitate to get help from executive coaches, Meyers Briggs training, or other peer groups, such as the EO Network.

    Understanding the sources of your own negative tendencies also helps you make sense of others’ behavior, and support them to maximize their contribution and loyalty. Discussing your flaws openly invites others to do the same.

  5. Dispel your sense of superiority and primary contributor. With any success, we are liable to overestimate the role we played in it, and underestimate the role of other, and luck. This can alienate people around you who deserve credit, resulting in you becoming more isolated and paranoid, or starting to believe you are actually superior.

    The challenge is to integrate humility into your life. It could be a sense of greater good that keeps you humble, a partner who keeps you grounded, or an insatiable sense of curiosity that keeps you inquisitive. Always give credit for your wins to all those involved around you, and be the first to take responsibility for losses.

Ultimately, self-awareness is about being the best competitor and the best leader that you can be, always making sound judgments, and effectively engaging with your team, partners, and customers. In business, you are usually many decisions away from success, but always one decision away from failure. Make every one count.

Marty Zwilling

*** First published on Inc.com on 10/17/2018 ***

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Monday, October 29, 2018

Effective Marketing Today Begins With A Conversation

conversation-marketingAs a long-time advisor to small businesses and startups, I still find many who think marketing is still primarily broadcasting your message to as many customers as possible, hitting them again and again, until it sticks. They don’t realize that customers today are looking for relationships, meaning two-way conversations with your business. They ignore all else as just plain noise.

Customer conversations are easy today, through responding to customers on social media, web live chats, and interactive applications on mobile devices. In fact, your marketing costs using this approach may be far less than the traditional television, newspaper, and email campaigns. Yet even conversation marketing has to be done right to get customer attention and have an impact.

I found the rules and expectations nicely illustrated in a new book, “Conversation Marketing: How to Be Relevant and Engage Your Customer by Speaking Human,” by one of the experts in the new digital marketing strategies, Kevin Lund. He offers a wealth of examples that I second from my experience on how to get started and do it right, as well as real guidance on what NOT to do:

  1. Don’t pay attention to customer input. In great marketing, as in real life, starting the conversation is just the beginning. You have to focus and listen to what the potential customer is saying during the conversation to fully understand their message and needs. We all know people who don’t listen while we are talking. Don’t let your business be one.

    For example, it’s easy to get so focused on selling the product you have, that you miss the customer desire for free shipping, or personalization, or colors you don’t have. Instant empathy and positive responses will make new customers your best advocate, bringing customer friends and repeat business you can’t get with traditional marketing.

  2. Talk about your products, not your customer. Nobody wants to listen to someone drone on about how great they are. Yet, throughout the decades, common advertising copy has been a description of product features and benefits, with a nod to what it will do to enrich the customer’s life. Don’t let your conversation marketing do the same thing.

    A successful content marketing strategy turns traditional advertising on its head by first asking customers to tell you what they need, only then bringing up what your business offers to meet those exact needs. Pull in customers with questions, rather than pushing answers.

  3. Try to close on a sale transaction too early. As with all relationships that you want to last, preparing for a close must be done with patience and two-way conversations. Old-fashioned marketers feel the pressure to produce an immediate return on investment (ROI), and prefer the billboard approach to closing. Do less pitching and more teaching.

  4. Offend or talk down to your potential customers. The best content marketing is tuned carefully to the desired customer set or demographic. That means than one size probably doesn’t fit all – if your audience is millennials, the questions you ask and the language is different from what boomers expect. Be sensitive to geographic and cultural implications.

    What constitutes a ‘basic assumption’ depends on your audience. If, for example, you’re writing a blog post aimed at professional investors, you don’t need to stop and explain what an entrepreneur is to them. Don’t offend customers by getting too personal for certain cultures in your attempts to understand what it takes to be memorable.

  5. Don’t have credible data to support factual content. We have all had conversations with a know-it-all who makes questionable statements, causing us to lose trust now, and for the long term. Make sure your content can withstand even the most critical scrutiny, and doesn’t come across like marketing hype or unsubstantiated claims.

    For example, we have all seen weight loss and exercise products that claim to evaporate some number of pounds and inches in the first week, without any reference to a real study supporting these assertions. Credibility is key in relationships, so pick your influencers well. The safer way is to let your advocates and their friends share their facts.

Conversation marketing will help you connect your business to the hearts of your customers for the long term, not just to their minds for a single transaction. They want a sense of personal value and a relationship before they act. You can’t deliver that with a one-way monologue.

Marty Zwilling

*** First published on Inc.com on 10/15/2018 ***

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Sunday, October 28, 2018

7 Ways College Degrees Can Expedite Startup Success

Entrepreneurs_Event_at_College_of_DuPageA popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. I agree with Robert E. Litan, former VP of research at the Kauffman Foundation, that these are exceptions to the rule, rather than a model to emulate.

Some people even believe that entrepreneurs must be born with the right genes, and no element of education is relevant. While I do agree that many attributes of a good entrepreneur, such as curiosity, confidence and determination, are largely determined by early-life experiences, a good education is critical in understanding the elements of creating a business and wooing customers.

In my view, the most effective entrepreneurs are those with a background of an array of real-life experiences, both positive and negative, as well as good academic and coaching activities. In fact, failure has been shown to be a better teacher than success, so parents and schools who protect their charges from any failures may not doing them any favors in the long run.

While we all know a few good entrepreneurs who dropped out of school, the Internet is full of stories on many more who capitalized on at least four years of college, including Sergey Brin and Larry Page of Google, Chad Hurley of YouTube and Bob Parsons of GoDaddy.

A more important question, then, for an aspiring entrepreneur, should be what to study in college for maximum value, rather than whether to drop out or stay. Here are my thoughts on the right focus at a college or university:

  1. Take entrepreneurship courses, but major in a more specific discipline. Depth in a specific business area, such as marketing or accounting, is important in understanding the internal and external processes of a business. Entrepreneurship is more about pulling all the elements together, making change happen and building relationships.

  2. Practical business courses are better than an advanced degree or MBA. Starting a business is not rocket science. A breadth of understanding of common business principles, such as management, personnel and finance, is more important than a depth of knowledge in a technical area. Don’t forget business writing and communication.

  3. Get involved in startup-business incubator activities with peers at school. Most universities have formal incubator and business development organizations that focus on coaching, grant writing and technology licensing. These present a huge opportunity to take your first steps as an entrepreneur with minimal risk and maximal support.

  4. Produce a real business plan for critical feedback from outside investors. It’s important to go well beyond the passionate idea stage. Writing a business plan is the only way to determine if you even understand what your dream is all about. Once you graduate, the feedback will cost much more, and it’s too late to take one more course.

  5. Extend your networking into peer interest groups outside your school. Start with your school connections with peer universities around the world. Then branch out to local business groups. Peers won’t be able to help you much in finding external investors, co-founders with prior experience and industry connections for distribution and marketing.

  6. Find summer internships and part-time work in your field of interest. You can’t really learn all you need to succeed in any business domain from textbooks. The idiosyncrasies of supplier relationships, distribution and pricing are just as important as the generic elements of time and money management. Get real experience early.

  7. Incorporate your first business before you graduate. It’s never too early to stop studying and start doing it for real. You will learn the most by facing the tribulations of establishing an LLC and dealing with insurance, personnel and tax issues. Remember, it’s the learning that counts, not the size of the bet or the ultimate success of your first try.

The best thing you can learn in school is how to learn -- fast and effectively. In the real world, change occurs very rapidly, so all the specifics you memorized from textbooks will likely be obsolete by the time you need them. Your academic credentials will have very little value as well. The value is in your ability to get new credentials in your business faster than your competitors.

If you are already in Harvard, and have proven that you learn quickly, then feel free to drop out and change the world. For the rest of us, a bit more practice before jumping feels like a better bet. We need all of you at your best.

Marty Zwilling

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Saturday, October 27, 2018

5 Key Elements Of A Winning Business Strategy Today

idea-plan-strategy-successDoes your business have a visible positive strategy, or do your customers and employees still see your primary focus as closing more sales and killing competitors? Certainly that has been the strategy of many companies, and has worked in the past, but today’s customers and workers are looking for more. They want relationships, positive experiences, and a win-win for society.

With the pervasive and instant communication of social media and the Internet, businesses can no longer hide behind the mask of their own hype, either inside the company or outside. The right positive strategy is integral to claiming leadership as well as making it happen.

I just reviewed the classic book, “The Strategic Leader’s Roadmap,” by Harbir Singh and Michael Useem from the Wharton School, which provides some specific steps along the way. I believe these steps are especially critical to the success of entrepreneurs who are rolling out new businesses today. It all starts with setting the right company strategy, including these elements:

  1. Inspirational statement of purpose and direction. The old mission statements declaring your intent to be the “low-cost provider” is no longer a motivating vision for employees or customers. Engaging visions today include elements of social and environmental responsibilities, as well as economic returns to constituents.

  2. Market and customer positioning. Clearly focusing on the right market and customer profile sets your competitor differentiation. It starts with understanding the drivers of customer excitement in advocating your solution, and ways to strengthen relationships. When customers are excited, your team becomes more engaged and productive.

  3. Customer and employee value propositions. What are the company’s solutions and practices that will be seen as win-win value by all constituents? Your managers and everyone on your team needs to understand how their actions and leadership relate to value provided. The strategy must drive leadership so that leaders can drive the strategy.

  4. Competitive and leadership leverage. A good strategy provides opportunities for internal actions and leaders to optimize and extend a firm’s competitive advantage. This requires effective communication of intent, flexibility in implementation, and positive rewards for innovation and initiative in improving customer experience and quality.

  5. Constant restructuring for future advantage. A strategy that does not evolve as the market changes is a losing strategy. The internal team must see a reward in fostering change and leadership, and customers must be energized by new and improved processes, practices, and solutions. The best strategies are dynamic, rather than fixed.

A positive business strategy allows you to lead strategically by mastering the elements of both, separately and as an integrated whole. The authors argue that strategic leadership is an acquired capability that can and must be mastered by managers at all levels. It needs to extend to the firm’s directors, as well as investors. Everyone has to think and act strategically.

Another growing force for strategic leadership is the evolution to globalization. New companies are automatically global in reach and visibility, which makes a lack of strategy more impactful, since there is no move to an alternate environment for correction and restart. You need to get it right the first time, or there may not be a next time.

Above all, no company can afford to confuse strategy with tactics. Strategy is the “what” part of the equation, and tactics are the “how” activities. Every business, especially startups, have limited resources to implement tactics, so they need to be totally clear on the strategy first. Even if you could unleash unlimited tactics, the results would be confusing and non-productive to employees and customers alike.

Business success is an elusive target – with over fifty percent of new businesses continuing to fail in the first five years. We are also seeing an increasing number of former leading businesses disappear from the scene, including Blockbuster, Kodak, and Sharper Image. Start with a focus on strategy, and keep it there. Maybe it’s time to check yours with your employees and your customers, and see how positive it is today.

Marty Zwilling

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Friday, October 26, 2018

7 Strategies To Create Your Own Market And Win Bigger

Elon_Musk's_Tesla_Roadster_1New technology markets and paradigm shifts have traditionally been bad bets when seeking investors, since these were known to take decades to develop, and cost lots of money. For example, consider how many years it took for the market to move from radio to television, or fully accept personal computers on every desktop. The leading edge was too often the bleeding edge.

Yet now I believe the evidence is clear that the world has changed. Many customers now actively seek out new technologies, rather than wait for many others to try it first. Technology is changing faster than ever, and new things usually work when they are released. Steve Jobs proved it with the iPhone, and Elon Musk can’t produce his electric cars fast enough to keep up with demand.

Bold entrepreneurs now can credibly talk about entirely new markets, such as the Internet of Things (IoT), genetic modifications, and privatized space travel. However, such changes don’t yet happen automatically, so it still takes proactive strategies and key actions to create new demand where none exists. Here are the specifics that I recommend to improve your odds of success:

  1. Sell the market concept before building a product. Today, with instant and pervasive Internet communication, you can sell your vision via blogging, crowdfunding, and videos before you spend big money building prototypes and pivoting as you learn. This will prep and size the market, and greatly increase your chances of getting it right the first time.

  2. Highlight positive social and environmental impacts. For example, if your new product reduces pollution or world hunger, this adds immediate value and confirms a positive long-term strategy for customers today. Too many founders still focus their product design and selling efforts only on direct paybacks to the customer.

  3. Incent your team to continually think “outside-the-box.” You set the limits and the culture for your team, based on how you reward creative thinking, or penalize people for failed experiments. It starts with hiring the right people, and building relationships with the right experts, analysts, and investors. Then you really listen to what they have to say.

  4. Work to build a compelling story around your new idea. Customers need to see personal and social benefits around a new solution, not just a new technology. The change must also include long-term benefits, as well as short-term. A compelling story can make or break your ability to differentiate your solution from dozens of others.

  5. Use social media and the media to build demand for change. New markets don’t just happen, or create themselves. People need to be influenced and educated to change consumption habits, expectations, and buying patterns. Product messaging and branding need to follow later, after the initial demand has been built. Concept marketing is critical.

  6. Build momentum with an integrated marketing campaign. All the elements of change required for the new market must be addressed consistently, not just the product elements. A successful campaign must not only capture people’s imagination but must have the right integration to move people to a new frame of reference and new thinking.

  7. Acknowledge and position competitors around you. It may sound counterintuitive, but when you are creating a new market, competition helps legitimize it and increases the size of the pie. Position competitors positively around you, and continue to find ways to keep yourself ahead of the crowd, with both product offerings and thought leadership.

Elon Musk, for example, opened all his battery patents to competitors, with the expectation that this would expand the market as well as build the support infrastructure for his Tesla electric car market. He highlighted the positive environmental aspects, as well as the high performance remote maintenance elements of his new technology. New markets don’t have to be disruptive.

Thus new entrepreneurs have a new alternative to the tried and true approach of linear thinking, cost reduction, and more new features. Maybe it’s time for you to step out of your comfort zone, think more broadly, and pursue a new market legacy for maximum fun and profit.

Marty Zwilling

*** First published on CayenneConsulting on 10/10/2018 ***

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