Friday, May 25, 2018

6 Relationship Strategies That Propel Your Business

Kathy_Ireland,_Warren_Buffett_and_Bill_GatesUnfortunately, people who are great at inventing things, and have high creativity, often don’t have strong interpersonal skills or interests. As a mentor to aspiring entrepreneurs, I see a high level of frustration from people in this category who have personally developed great solutions, but can’t make them into a business. They don’t realize that running a business requires relationships.

I strongly believe the talent to effectively build relationships can be learned, just like any other skill, even if you are an introvert like me. It does take effort and focus, just like learning other skills that you need to achieve objectives you have set. In business, you need to build relationships with a wide range of people, including investors, peers, employees, and of course customers.

As part of my own efforts to maximize my relationship efforts, I found some concise business-oriented guidance in a new book, “Born to Build,” by Jim Clifton and Sangeeta Badal, Ph.D. These executives from Gallup bring together their best data from business professionals around the world, to offer the following strategies for stepping our relationship results up a notch:

  1. Build new relationships by diversifying your networks. Force yourself to go beyond people in your immediate circle, and those you know well, to contact and nurture a real relationship with at least one supplier, a customer, and a competitor. The next step is to seek out relevant people from unrelated organizations, such as media and government.

  2. Give as much as you expect to get from every relationship. Effective relationships in business require reciprocity – not a one-way half-hearted effort. Offer and deliver help, connect people with each other, or share industry or nonprofit-sector information. Only then will you feel satisfaction and find others willing to respond when you need help.

  3. Selectively spend quality time on key relationships. Spend time with your most important customers, your most productive employees, and leaders who can make the most difference to your organization. These relationships will generate returns in the immediate future and in the long run. Avoid the trap of idle discussions and ego building.

  4. Keep your focus on the local social and business landscape. Pay attention to bonds, loyalties, and networks that characterize your community. Recognize the norms, values and preferences that shape the behavior of the people you need. This will help you form a durable and effective network that you can maximize for your business interests.

  5. Apply your time, brand, and resources to key social issues. Build a constituency of relationships with people who have shared beliefs, interests, and ambitions. Collaborating with them on solving shared social problems will turn them into engaged advocates of your business and make them your most powerful allies in building other relationships.

  6. Prune, renew, and reshape your networks frequently. Nurture people relationships critical to your organization carefully and often. Push contacts whose usefulness has diminished over time into your inactive network. Regularly identify new relationships that are vital to the future of your business, and define strategies to build these connections.

I do offer some points of caution in all relationship building efforts:

  • More relationships are not always better. Highly successful business leaders don’t necessarily have larger networks. Be selective about the associations you form, listen carefully for situations where you can add value and derive value, and prune the rest.

  • Overinvestment in relationships can take precious time away from focusing on the technical elements of your business. Invest your time wisely in balancing the demands of market awareness, new technologies, and future organizational strategy.

  • Sometimes strong relationship networks can shut out new people and new thinking, insulating you from fresh input from the “outside.” Introducing new elements into your network will generate new perspectives, new experiences, and positive change.

Overall, the breadth and depth of your relationship networks is more critical to your business success than your ability to define and build the perfect solution. These relationships empower you to confidently and aggressively take risks, continually innovate, and recover from losses and setbacks along the way. Your business is a community, not an island. You can’t run it alone.

Marty Zwilling

*** First published on Inc.com on 05/10/2018 ***

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Wednesday, May 23, 2018

8 CEO Traits That People See As Strength Of Character

Warren_Buffett_KUAs an angel investor in early-stage startups, I’ve long noticed my peers apparent bias toward the strength and character of the founding entrepreneurs, often overriding a strong solution to a painful problem with a big opportunity. In other words, the entrepreneur quality is more important than the idea -- in investor jargon, people invest in the jockey, and not the horse.

I’ve often wondered if anyone has quantified the implied assumption that leadership character is indeed a critical element of the success equation for startups, so I was pleased to see the classic book “Return On Character,” by Fred Kiel, a renowned leadership consultant. He has completed a study of more than 100 CEOs, with feedback from over 8,000 of their employees on this topic.

His research concluded that CEOs who received high scores for character also achieved much higher business results – nearly five times the average return on assets (ROA) during the two-year period covered. On the other hand, those CEOs with the lowest character scores (self-focused) were distrusted and suspected of telling the truth only slightly more than half the time.

Through interviews, Kiel identified eight common traits and habits exhibited by all the CEOs with a top character ranking (deemed virtuoso CEOs – masters of the skills and art of leadership):

  1. Displayed and demanded high moral principles. These are summarized as the four keystone character habits of integrity, responsibility, forgiveness and compassion. The authors found these to be achievable through self-training and practice, rather than requiring a genetic endowment. That means all of us have a chance.

  2. Embraced a worldview of positive beliefs. The scope of the positive leadership views included human nature, organization life, and personal purpose. The lower character leaders were consistently more negative and pessimistic in their worldview. In both cases, the beliefs tended to become realities.

  3. Developed a higher level of mental complexity. A leader judged high on cognitive complexity tends to perceive nuances and subtle differences that a person with a lower measure does not. High leaders continually challenged their own ideas and were quicker to adapt them to encompass new information, experiences, and meaning.

  4. Sought out and listened to critical feedback from others. High scoring leaders seek and positively respond to feedback from three critical groups: peers, customers, and direct reporting team members. Self-focused leaders, on the other hand, are more likely to resort to denial when faced with unpleasant feedback.

  5. Find and enjoy the company of one or more mentors. The leadership benefits of mentoring start in childhood, but are just as important at the mature CEO level. Virtuoso leaders recognize and seek three types of mentoring – career mentoring for the longer term, peer mentoring for tactical guidance, and life mentoring for quality of life balancing.

  6. Demonstrate the ideas and behaviors of self-determination. Leaders with a high level of self-determination continually seek more competence in their chosen domain, relatedness and connectivity to other stakeholders, and the autonomy to act in harmony with an integrated view of themselves.

  7. Virtuoso leaders know their life story. By crafting a coherent narrative of their life, they are better able to understand the major events and influences that have shaped their personal development and use that understanding to assess and improve their response to new situations as they arise.

  8. Sought and accepted help from many supportive people since childhood. Leaders who have sought help from natural helpers since childhood, including parents, teachers, and business influencers, usually feel more accepted, respected, and affirmed, and pass that feeling on to followers.

While Kiel’s focus was not specifically on startups, I believe the insights and conclusions apply equally well, if not more so, to startup environments. Every entrepreneur needs to understand the importance of character and leadership is to their growth and success, as well as their ability to attract investors. The return on character in business is well worth the investment.

Marty Zwilling

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Monday, May 21, 2018

7 Accelerants For Team Learning And Business Growth

growth-team-learningWe all want opportunities to learn, experiment, and grow in our jobs, but most bosses and businesses tend to seek out and reward team members who already know how to do the job, and can repeat the task without fail as the business scales. I believe this is the conundrum that leads sadly to less than 30 percent of people being fully engaged at work, and low morale all around.

As a former manager in big businesses, as well as the founder of my own small startup, I found that leading team members on their own learning curve, and designing their job to maximize learning and engagement, is a win-win situation for the business as well as the employee. The best part is that everyone is poised for today’s rapid market changes, rather than fighting them.

I was pleased to see this approach highlighted in a new book, “Build an A-Team,” by Whitney Johnson, an award-winning Wall Street analyst, writer, and keynote speaker on business and career innovation and growth. I fully support her outline of seven accelerants of learning and growth in business, which I believe every manager and entrepreneur should practice:

  1. Become a talent developer, by taking some risks with people. This starts by finding new hires that have to stretch to fit the role, and mentoring them as they learn. Every team member should be rewarded for taking market risks to grow themselves and the business. Actively create and share a plan to move them to new roles as they mature.

  2. Pinpoint individual distinctive strengths and utilize them. To perform at the highest level, and get the greatest satisfaction, each member of the team must operate from a position of personal strength in job assignments. Because we all have a tough time spotting our own strengths, your job is to help people find and deliver in their best roles.

  3. Impose thoughtful constraints on time and budget for focus. We all want unbounded freedom to do a job, but we also realize that tasks tend to expand to fit the time and budget allotted. Reasonable constraints force team members to be resourceful, creative, and learn from taking risks. The result is personal and business growth and innovation.

  4. Battle against entitlement, yet celebrate even small successes. Fearing an increased sense of entitlement, manager sometimes dial back on praise. Smart managers learn to reward progress without entitling team members. Disruptive innovation thrives in an environment of gratitude and continuous learning, rather than one of entitlement.

  5. Position stepping backward as a way to move forward. Many of the best companies support taking a leave of absence for additional education or training. This step back from current responsibilities can be a slingshot to greater long-term growth. The same can be said for side assignments of other countries, or broadening roles in other organizations.

  6. Give failure its due, and push employees to new challenges. Learning from failure is not always instinctive, but you can help it be constructive rather than destructive. In the same way, a good manager is a bit like a parent, pushing charges into uncomfortable situations and helping them grow and learn. Good employees love stretch assignments.

  7. Encourage individualized discovery-driven growth. This is called planning to learn, rather than learning to plan. You need to have a destination in mind, but let your team members tell you the best way to get there. Pit them against the real challenges, and innovation will follow. Be quick to shift team members as their skills and talents evolve.

If you follow these initiatives, I assure you that you will drive higher performance and higher morale in the organization, as well as become the boss people love. People need continuous learning and fresh challenges to stay engaged, and your business needs it to thrive, no matter what the economy and your industry throws at you.

In my advisory role, I often see the alternatives, and they are not so positive. You will lose your high potentials, and even if they do stay, they won’t innovate and your business will become less competitive. You will be beaten by faster-adapting competitors because you won’t be prepared for the future. Remember that the single biggest impediment to innovation could be you.

Marty Zwilling

*** First published on Inc.com on 05/07/2018 ***

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Friday, May 18, 2018

8 Early Indications Of Trouble Ahead For Your Venture

graph-business-in-troubleAs a company executive, or a business advisor, we have to always be on the alert for indications that your business, while looking calm on the surface, has strong undercurrents starting that can lead to disaster. You don’t want to be in one of those high-flying companies, like Webvan, Pets.com, and eToys, that almost made it to the big time, before fading or crashing into oblivion.

You can’t always believe what you hear after the fact from company executives, or even industry analysts. Popular rationales include attempting to grow too fast, product quality problems, and missing the market, but the realities often go much deeper. Here are some early signals I see too often, which are recoverable if recognized and acted on sooner rather than later:

  1. Competing or toxic cultures start to build momentum. Everyone on the team must share the same purpose, values, and goals. Unhappy employees usually indicates that multiple agendas exist, such as some people driven by customers, and others by technology. The founder or top executives must set one culture by words and actions.

  2. Company leaders don’t maintain trust and transparency. When I do due diligence for investors, and I find team members hesitant or openly negative when talking about the leadership team, there is likely a trust issue, or at least a failure to communicate. Leaders need to “say what they mean and mean what they say” all the time and every time.

  3. More passion is being applied to a product that is not ready. If your solution doesn’t work, or can’t be delivered in the marketplace, no amount of determination or passion will save you. For high technology solutions, almost working is failing. Business leaders need to be realists, to understand when to pivot and when to fall back in recovery mode.

  4. Poor cash flow management is leading to bad decisions. Vendors and most people on your team need to be getting paid on a predictable basis, or their loyalty quickly turns to retribution. Soliciting timely and adequate funding is more critical than development. Too much money can have the same negative effect on focus and decision making.

  5. Uncontrolled team conflict is killing productivity and motivation. The best business teams don’t shy away from some healthy friction and heated debates between team members and leaders, to recognize innovative insights and make change happen. Yet we all know that there is a fine line here, beyond which heated debates generate so much emotion and drama that the entire team becomes dysfunctional, stalling progress.

  6. Great technology is touted as the long-term business savior. No matter how amazing your technology, a successful business requires marketing, solution delivery, and customers with a problem and the right amount of money to spend. Even if early-adopters are quick to jump, make sure the mass market appreciates your solution.

  7. Plans and priorities are changing at an accelerating rate. In these times of rapid market evolution, it’s good to see plan change agility. Yet, this change ability must be managed, and not allowed to degenerate into chaos, with less and less communication from the top. If you don’t know where you are going, you probably won’t get there.

  8. Putting more focus on blame than resolution and prevention. Every business makes mistakes when taking risks for growth and innovation. Companies in trouble tend to assume a victim mentality and blame factors outside their control, rather than learn from experience. Team members need to be rewarded for taking risks, rather than punished.

These signals are usually accompanied by a variety of others, including key leaders jumping ship, overall reduction in morale, rapid organizational changes, and micromanagement. If you see these symptoms in your own company, there still may be time for recovery, or it may be time to join the exit before disaster strikes.

The best antidote I know for heading off all these problems is building an advisory team early, consisting of no more than five external advisors, who have individual expertise and experience in similar business domains, and then actively listening to their perspective and recommendations. Don’t let the waves of change become a tsunami that you don’t see coming until it is too late.

Marty Zwilling

*** First published on Inc.com on 05/02/2018 ***

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Friday, May 11, 2018

5 Leadership Practices That Violate Natural Instincts

counter-intuitive-leadershipEven though we all know that success in business means taking risks on new and unproven innovations, we are still creatures of habit, programmed by evolution to favor the safe and familiar. Thus following your natural instincts and intuition in growing your business is often the worst thing you can do. Yet training yourself and your team to practice unsafe thinking is scary.

For example, every entrepreneur selling online and struggling with growth, seems to come asking for money to expand into retail (safe and known territory). As an investor, I see retailers failing and downsizing all around me, so I’m looking for founders with new and innovative business models that I’ve never seen before, like the shared-economy models of Airbnb and Uber.

Since none of us can see the next business breakthrough, we can only emulate the people who have brought real innovation to market, and challenge the team around us to think counter-intuitively, in hopes of changing habits. I found some real insights along these lines in a new book, “Unsafe Thinking,” by Jonah Sachs, who is one of the influential social innovators I know.

He outlines a set of straightforward practices that both he and I believe we can all use to create counter-intuitive breakthroughs ourselves. We don’t need to wait for lightning to strike, if we proactively improve our ability to accept more seemingly outlandish solutions and ideas:

  1. Focus on the inconvenient truths of your industry or company. Perhaps your known world doesn’t always work in the ways you intuitively expect. What’s the grain of truth hidden in the feedback from persistent critics or unhappy customers? Look for these as starting points for productive cognitive dissonance rather than anomalies to ignore.

  2. Reformulate existing problems to ones that open new doors. Some problems seem to have no solution that offers you growth. For example, if your customers don’t like your home security solution price, perhaps you should be selling it to insurance companies. They have more money, and can offer it free to customers due to reduced claim risks.

  3. Bring in an outsider’s mindset, or simply an outsider. Sometimes we are all too close to see the real problem, or the solution. What seems counter-intuitive to you may be more evident to an outsider. In business, it pays to ask for insights from smart but less connected advisors, or challenge the creative thinking of new members on your team.

  4. Listen to your intuition, but test it critically before rollout. Jumping to conclusions based on intuition still leaves room for creative thinking to validate the result. I still see too many business owners who are quick to lower their prices, only to find themselves in a deeper commodity hole. Counter-intuitively, you may need to raise prices for exclusivity.

  5. Present ideas as minimally unsafe, to maintain credibility. Counter-intuitive concepts, when they break too many expectations and arouse too much dissonance, are often arbitrarily dismissed. People tend to listen and talk about ideas that don’t shock all norms. Once people engage, the team more readily pushes the limits, and experiences buy-in.

Often you will find the best opportunity for a breakthrough is a problem that seems intractable and that you wish to quickly resolve with a simple solution, like giving your customer his money back. If you stick with these problems longer than is comfortable, and find an innovative solution, you could end up with a delighted customer who brings in many new customers via social media.

For your team, you also must remember that they respond to what you reward. Incenting the most creative and non-intuitive ideas has been shown to fuel many breakthroughs. On the other hand, paying people for how fast they close problems will have the opposite effect. Instill a sense in your team that it is safe to suggest crazy ideas, ask big questions, and step into the unknown.

Experience in business is a great teacher, but it can also leave your performance and your company in a rut. Now is the time to rethink how safely you work, look for those blind spots, and build a healthier and more thriving company by embracing intelligent risk and some counter-intuitive ideas.

Marty Zwilling

*** First published on Inc.com on 04/28/2018 ***

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Monday, May 7, 2018

8 Tips To Improve Your Work Results and Satisfaction

man-multi-taskingIn my role as business advisor, I rarely find owners and founders who aren’t working hard, but I often find dedicated people who can’t seem to stay focused. That means they may be killing themselves by working twenty hours a day, multi-tasking between email, their smartphone, and the crisis of the moment, but find themselves unable to focus on strategic issues and hiring.

For example, I tried desperately to channel the boundless energy and enthusiasm of a new business owner a few years ago, but she insisted on being a part of every activity, until she aggravated some previous health limitations, became bedridden, and the business floundered. We are all human, so it pays to recognize our limitations, and spend our energies wisely.

Over the years, I have developed some basic rules that work for me, and I believe can really help any business professional manage their focus and awareness in all work activities. Practicing these will ensure greater productivity, less stress, as well as an improved overall sense of well-being. For business owners, these rules can mean the difference between success and failure.

Many fast-growing companies, including Google and Starbucks, have active coaching programs to highlight these mental strategies and habits that lead to focus, and increase overall productivity:

  1. Give full attention to individuals, objects, and ideas around you. Start by making a conscious decision to intentionally be totally present and focus on each team member, client, meeting, and family member. Don’t let your mind wander or give in to distractions around you, such as phones ringing, social media notifications, or report deliveries.

  2. Focus on previously-seen problems from a fresh perspective. In this fast-moving word, today’s reality is different from the past, but it’s easy and often not productive to apply old perceptions, rather than utilize your more satisfying curiosity. Mindlessly applying the “way things have always been done” will not enhance your career.

  3. Balance your efforts between satisfying tasks versus difficult. Practicing awareness of balance will lead to a change in your ability to focus and complete all tasks. Many business professionals give priority to easy tasks, such as email and texting, and practice long-term avoidance of more challenging work, thus lowering overall productivity.

  4. Accept that you need not solve every problem personally. Extended fighting with a specific problem leads to anger and frustration, but rarely solves it. Focus until you have exhausted your own reasonable efforts, and then seek help. In business, the most productive people are ones who can work effectively with all the resources around them.

  5. Regularly purge frustrations and negative thoughts from your mind. Clearing your mind is a simple powerful mental strategy to reset your perspective and refocus your thoughts to the task at hand. Eliminate negative distractions and toxic relationships. Spend some time on positive outside activities, including sporting events and music.

  6. Find an occasion to smile and laugh every day. The key to cultivating happiness and joy is to focus on at least one activity that you enjoy daily. The best leaders look for positives to celebrate, rather than always being critical. Sometimes joy is just reserving a specific time for quiet contemplation and appreciation of all the good you see around you.

  7. Incorporate kindness in every interaction with people. When you treat people with respect, understanding, and focus, they will do the same for you, making both of you more productive and happier as well. Handling constant interruptions is frustrating at best, leading to emotional and insensitive reactions, rather than constructive feedback.

  8. Practice patience and listening before impulsively responding. Get in the habit of taking a few breaths to calm down before focusing on the next crisis request. Sometimes I find this means counting to ten or a bit of discomfort before tackling the next challenging situation. Other times it means softly saying “not now” or “get on my calendar.”

Without these initiatives, most people will find their productivity at work declining. We all face the same information overload, increased pressure to move fast, and often distracted work reality. Our attention is continuously under siege, leading to fewer results. Have you noticed an impact on your perspective, health, and happiness? Now may be the time to increase your focus.

Marty Zwilling

*** First published on Inc.com on 04/21/2018 ***

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Sunday, May 6, 2018

6 Tips On Honing A Culture Of Winning Through Focus

business-focus-more-with-lessIntuitively, many entrepreneurs and businesses believe that the key to faster growth and success is more products, features, and markets. Since we all have limited resources, and can’t add more hours to the day, the result is usually more things done poorly, rather than a few key things done better than anyone else. The message here is focus, reiterated by every advisor and investor.

Good examples of startup focus before success include Google with their search engine, Facebook with friends networking, and Apple with personal computers. Later, after that initial success builds resources, and your penetration of the target market approaches 30 percent, it’s time to expand your horizons and make anticipatory changes to your focus. Don’t wait for a crisis.

For larger and mature companies, the hard part seems to be giving up the familiar space that isn’t working so well anymore, so that you can focus on a new segment or opportunity. This was highlighted in the classic book “Do Less Better,” by John R. Bell, an experienced business expert, who highlights the power of strategic sacrifice in today’s complex business world.

Bell calls this change hesitation the failure to kill your darlings, or the fall from a specialist to a generalist. All entrepreneurs must succeed first as specialists, using pivots as required to zero in on the real and current market. It’s a tough world even for big-company generalists, who take on the complexities of product diversification. Just ask J.C. Penny, Radio Shack, and many others.

I particularly like Bell’s discussion of business culture characteristics that create the necessary focus and being the best in any business environment. This culture must be maintained by every company at every stage of maturity. I’ll paraphrase several of the key elements here in the context of entrepreneurs and startups:

  1. An overriding sense of urgency and passion. Nimbleness and urgency to get the job done will set you apart from your competitors in so many ways, particularly with customers. It comes naturally with a small highly motivated team, but it’s increasingly difficult to maintain in the face of size and success. Build it at the start and don’t ever lose it.

  2. Well-articulated goals and metrics. Your success or failure must be quantified by such key business indicators as market share, financial ratios, brand awareness, new product launches, and execution within the deadlines. Like the refrain of an old country song, if you don’t know where you’re going, you will probably end up somewhere else.

  3. Innovation-driven mindset and actions. Startups can’t hope to outspend a giant with a fat balance sheet. Rather you must outsmart the giant with innovative thinking, pivoting on a dime, and impeccable execution. Innovation initiatives of any appreciable scale require a formal, intentional resource commitment, and work best bottoms-up.

  4. Zero tolerance for complacency and status quo. Always strive to increase your lead, and while competitors scramble to catch you, unleash your next breakthrough product, service, or promotion. It’s easy for complacency to creep in unnoticed in the face of initial success. Continually move up the bar to re-test your personal limits and your team.

  5. Maintain an intimate knowledge of the competition. You must know what your competitors are planning, and how they think, corporately and individually. Study their moves and engage your team for an analysis of updates. Avoid egotistical price wars and emotional outbursts, but make competitors think you are prepared to win at all costs.

  6. Focus on the few things that really matter. No organization, large or small, can manage more than five goals and priorities without becoming unfocused and ineffective. Keep these balanced and aligned between people and process, and keep the scope realistic. Concentrate your actions on preemptive projects that are within your control.

In the long run, to have a long run, your company needs a narrow and memorable focus that is constantly being updated in innovative ways. It’s easy to think that doing less as a company means you’re slacking, but results and longevity are all that count. Every entrepreneur and executive must learn how to build and maintain a culture of doing fewer things better.

Marty Zwilling

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Wednesday, May 2, 2018

6 Ways To Pitch Your Innovation To Today’s Customers

Disruptive_LogoEvery entrepreneur with a new technology tells me that his innovation will be industry-disrupting, meaning that it will render the existing technology obsolete, and create a new market. Yet truly disruptive innovations, like the smartphone from Apple and the rise of the Internet, are very rare, and are generally unpredicted. So why would any investor ever believe any of these claims?

In fact, as a mentor to entrepreneurs and an investor, I recommend that entrepreneurs avoid using the term disruptive with investors, since many see it as implying extra high risk, a long time for payback, and extensive marketing to build the new market. Yet a win in this department clearly has huge implications for success, and a very real potential to change the world.

Thus, it’s worth some extra effort to understand attributes of the market, in concert with your new technology, which might really indicate that industry disruption is possible with your innovation. In a classic book, “Disruption by Design,” by the renowned innovation consultant Paul Paetz, I found a list of common patterns and recognizable attributes that I like, called disruption fingerprints.

I suspect that several of these will surprise most entrepreneurs as being counter-intuitive to their thinking. Entrepreneurs tend to look for big changes and big markets when seeking disruptive opportunities, when the opposite may be more effective. I agree with Paetz that the following approaches are often more likely to find a disruptive opportunity around the corner:

  1. Initially address a small market niche. Disrupting a huge market intuitively has greater potential, but it’s also like turning an aircraft carrier. It takes a long time and lots of effort to overcome existing momentum, and both investors and customers want to see results on a small scale in their lifetime, before they line up to join the movement.

  2. Pick a technology that somehow seems inferior to the major incumbents. Existing players normally think in terms of bigger, better, and faster, whereas more customers may really be satisfied by smaller, cheaper, and simpler. Think personal computers compared to mainframes, or smartphone cameras compared to professional cameras.

  3. Target large but moderate-to-low-growth segments. Usually these are low-growth for a reason – a new technology or price point could easily be the trigger to a large opportunity. On the other hand, high-growth segments may look more attractive, but are likely being attacked by the big players and many other competitors.

  4. Look for sizable customer populations unattractive to incumbents. These may be people who can’t afford existing products due to income levels or location, but need the solution. Remember the explosion of cell phones throughout the world when cheap versions and new pricing models were introduced a few years ago.

  5. Explore industries where you are an outsider. Most business advisors recommend that you stick with the business area you know, where you have inside knowledge. Often entrepreneurs are more able to think outside the box and bring disruptive change to less-known business domains. Consider Apple’s move into music, telephones, and watches.

  6. Compete against non-consumption and non-existing markets. The most disruptive products are ones that never existed before, and no forecasts are even available to size the opportunity. Facebook built the social media market before customers even knew they needed it. Naturally, these are very high risk efforts, but have unlimited potential.

Of course, entrepreneurs looking for disruptive opportunities should never forget the more likely disruptive alternatives, such as bypassing existing channels to go direct to the customer, finding an order-of-magnitude cost breakthrough, addressing underserved needs, or offering dramatic improvements in ease-of-use and convenience to new and existing users.

Yet, even with these alternatives, market disruption is rarely predictable – it’s obvious only in hindsight. Every entrepreneur should aim for it, but restrain themselves from highlighting that focus to early investors, or even early customers. It’s one of the quickest ways to lose your credibility, and maybe even your opportunity. Pitch your innovation against today’s market.

Marty Zwilling

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