Friday, November 30, 2018

How To Improve Your Competence And Win People Over

Harvard-ConferenceOne of the biggest challenges I have as an advisor to tech entrepreneurs is to convince you that marketing is required for your product, no matter how great it is, just to get it found with today’s information overload. A comparable problem is to get entrepreneurs to market themselves, for the same reason. Your abilities will be lost in the crowd, because competence doesn’t speak for itself.

We have all heard the saying that first impressions count big, but in fact, you judge other people continually by your impressions of their competence, unless and until they provide you credible evidence of something better – through smart impression management or marketing of their experience, skills, and results. It is this perceived competence that gives you a competitive edge.

The challenge is to communicate competence without appearing to be self-centered or bragging. In the new book, “Convinced!: How to Prove Your Competence & Win People Over,” by Jack Nasher, a Stanford professor and negotiation expert, I finally found some guidance on specific approaches, with some pragmatic recommendations to make them work.

  1. Raise people’s expectations of what you bring to the table. I can tell you from my experience as an investor, after hearing hundreds of pitches, that my expectations start very low. It’s up to you to inspire me (and you) that you can do what you say is possible. In any business role, your manager only sees a fraction of what you know and do.

    In fact, you can raise a low bar of expectations of results by demonstrating confidence regarding your abilities and the task at hand. You need to reduce anxiety by eliminating anything that speaks against you, and highlighting past successes and experience.

  2. Highlight all good news around you, and reframe bad news. Associating with good news, even if not yours, strengthens your competence. Without excuses, position any bad news in a positive light, and focus on what you learned. Always start with the good news, then the bad news, and conclude with the second-best news to end on a high.

  3. Frame your competence perception to reduce qualms. First of all, emphasize up front any unfavorable circumstances that will make your job more difficult. Then highlight the role that your competence plays by pointing out how earlier successes, training, and education show you were born for this job, having survived from bigger challenges.

    For example, the legendary Steve Jobs and other captains of industry were quick to talk about their tough beginnings, overcoming great obstacles, and highlighting successes, to raise and reconfirm their perception of competence in the eye of peers and executives.

  4. Learn to get heard as an expert through power talking. Steve Jobs also practiced incessantly to become a masterful speaker, by speaking with confidence, pairing the right, impactful words with strategic use of vocal range, emphasis, and pauses. In all cases, avoid speaking too softly, often repeating points, or cutting others off.

  5. Communicate your competence through body language. Positive body language, including eye contact, smiling, location while standing, and posture while sitting, all strengthen the perception of your competence. Show enthusiasm during presentations by moving around and using large gestures. Position yourself near the front in meetings.

  6. Boost competency perception by increasing likeability. Creating an overall positive impression is of decisive importance, starting with always being friendly, polite, attentive, and educated. The evidence still shows that this extends to attractiveness and popularity as well. It always pays to look your best, and build relationships with key people.

According to the latest data, attractiveness in men is more about their faces and clothes than body figures, while with women figures are more important than their faces. Popularity builds with respect and interest in others, as well as goodwill building.

While some of these techniques take practice to master, none require sacrificing your values or faking skills you don’t have. The goal is to display and market your full expertise and competence, with authenticity and confidence, without waiting for someone to figure it out. The business world is moving faster and faster these days, so don’t fall behind by simply waiting to be found.

Marty Zwilling

*** First published on Inc.com on 11/16/2018 ***

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Monday, November 26, 2018

5 Business Warning Signs That Signal Ethical Exposure

Backstage at TechCrunch Disrupt San Francisco 2014. Photo by Max Morse for TechCrunch.Based on my years of experience working with entrepreneurs, I strongly believe that most of you start your business with the highest of ideals, but have no idea how many situations you will face that don’t have clear-cut answers, or raise ethical dilemmas. For example, how should you handle a cash flow crisis, where you have to choose between paying a creditor and your employees?

Every time I see an example of another company apparently having succumbed to integrity or ethical problems, such as the recent demise of Theranos, I wonder how an early advisor might have coached them to a different outcome. Theranos was a multi-billion dollar startup that was going to revolutionize blood tests with a single prick, but now has been shut down for fraud.

In my view, every entrepreneur and new business owner needs to start by reaffirming his or her own personal values, and then watching diligently for the warning signs that test your integrity and that of your team, or show that cracks are already appearing in your armor. Here are some key warning signs that I see most often, with guidance on how to respond:

  1. You sense a team switch to survival versus growth mode. When customers or funding fail to materialize, and cash runs short, everyone on the team starts to resort to more desperate measures to keep their job. It suddenly seems easy to cut corners on quality and service, or make commitments to customers with no real hope of delivering.

    To keep your team on the right track, they need visibility and straight talk from you and other internal leaders that they respect and trust. Don’t fall for the temptation to withhold the bad news, or sugarcoat the situation. Provide specifics on what is required, and how you expect them to act. In my experience the team will surprise you with their results.

  2. Conflicts of interest with outside investors and stakeholders. It’s not uncommon for investors to push strong personal agendas, or major stock holders to focus on short-term goals in lieu of your high-level ones. For the team, these pressures can cause tensions to run high, overriding their normal checks and balances on integrity and ethics.

    The best solution is real due diligence up front, before signing investors, to make sure they have the same values and objectives that you do, and agree to your key milestones. Then communicate regularly with all stakeholders, so they don’t get surprised, or feel that you have changed direction to their detriment. They have to understand and trust you.

  3. See efforts to minimize or cover up product or customer issues. Even with the best laid plans, and dedicated teams, things can and do go astray. The reality is that following your conscience can often have unfavorable consequences for your business. Thus the temptation is always great to hide the problem, or fudge results, as with Theranos.

    Entrepreneurs must make sure they take a visible leadership role in communicating and resolving key issues which can impact the business. Don’t forget your first and final obligation to the customer, and don’t delegate the final decision on such issues to your team. Team members should be rewarded, rather than penalized, for surfacing problems.

  4. High team culture impacted by elements of negativity. Without constant attention to hiring and coaching, every team can be poisoned by people who become disillusioned or negative about the current leadership or direction. Negative vibes and team members are a virus that can kill your culture, and cause others to take integrity or ethical shortcuts.

    Smart entrepreneurs stay fully engaged with their team, pick up on negative messages and team members early, and deal with them quickly. Complainers and low producers need to be moved out of the organization, before others are dragged down to that level.

  5. Multiple teams evolving into isolated silos. Cross-team communication and trust becomes more difficult for every company as it grows. Teams can become more and more focusing on their own priorities, at the expense of others, and even your customers. For example, sales challenges can always be argued as marketing or product problems.

    Your challenge as a leader is to keep all elements of your organization integrated and pulling together, by communicating common goals and objectives, setting priorities consistently, and rotating people across organizations for development and creativity.

In all cases, integrity and ethical behavior must be demonstrated from the top of the organization. Commitment and transparency are the catalysts that every team needs from their leaders to maintain a healthy and strong values. Have you checked for slippage in your own performance lately, or team warning signs anywhere that you can fix before they become a disaster?

Marty Zwilling

*** First published on Inc.com on 11/12/2018 ***

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Saturday, November 24, 2018

8 Steps To Assembling The Most Talented Startup Team

business-team-internationalWith the pace of change ever escalating, entrepreneurs today can’t afford to acquire talent through traditional hiring alone, and need to revise the perception that “talent” is only full-time employees. At the same time, more people in the workplace don’t want to be “employees.” According to an Intuit study, that number is quickly rising and will approach 40 percent by 2020.

The answer to both is a new fast and flexible talent strategy based on freelancers, consultants, experts, and specialists, who are part of the new “1099 economy” including Baby Boomers and Millennials. For the full picture, see the classic book, “Navigating the Talent Shift,” with convincing arguments by Lisa Hufford, Founder of Simplicity Consulting talent solutions.

The author outlines eight necessary steps for every business and entrepreneur to capitalize on this movement to on-demand project teams, versus permanent hires. These steps are the new keys to driving business innovation, controlling costs, staying nimble, and getting better results:

  1. Build teams to meet goals rather than organization charts. Too many entrepreneurs, as they grow their business, are focused on hiring to fill a traditional organization chart, rather than acquiring skills and talents to meet their current goals and needs. They use generic job descriptions and plan for long-term business stability, which rarely happens.

  2. Focus on deliverables and skills required right now. Conventional hiring strategies usually follow a vanilla approach to talent acquisition. It’s a numbers game of filling positions, without clarity on the expertise needed to deliver now. With contract players, you assume a project duration, with easy transition to new players for the next campaign.

  3. Prioritize objectives and seek expert talent to match. For example, if your first scaling effort is a global one, you should be prioritizing “global launch experience.” The notion of holding out for the “expert in all domains” wastes too much time, effort, and money. In fact, you will never predict required pivots, and generalists rarely outperform specialists.

  4. Build an on-demand team of strategic do-ers. The most effective people to execute strategic initiatives are likely ones who have recently led similar activities in multiple related environments, not ones who have been grown and trained inside. This team of specialist consultants is then easily tuned as your strategy evolves based on the market.

  5. Think in terms of projects to keep up with an evolving strategy. Each strategic priority should be managed as a project. Some projects are big and long-term, while others are small and more tactical. Projects need not be constrained by organizational boundaries, long-term budgeting, or conventional staffing and training practices.

  6. Stay nimble by quickly filling gaps in the existing team. When you identify a skills gap or feel you need additional expertise or insight, signing up on-demand help is the only timely solution. Assigning an existing team member who isn’t qualified, or is already overloaded, will likely delay both projects, and kill existing team member motivation.

  7. Leverage the broadest possible network. The on-demand specialized talent pool already includes 65 million people not interest in being full-time employees. By leveraging this broader network, you will improve your probabilities of finding the right skills and experience for your current project, and bring fresh ideas and solutions into your team.

  8. Maintain budget flexibility as the business changes. By leveraging on-demand experts, you pay only for the vital work you need immediately, not the overhead and ongoing costs (development, training, severance, benefits) that go along with hiring full-time employees. It’s the best way to handle budgetary restrictions and cuts.

This on-demand talent model, dubbed SPEED by the author (Success, Plan, Execute, Evaluate, Decide), is good for the company, and good for all specialized, dedicated, and high performing people in the workforce today. Your company gets the flexibility to adapt quickly to the needs of a rapidly changing marketplace, and workers get to broaden their experience in the work they love.

We are living in an on-demand world and an on-demand economy, ranging from the movies we watch, to manufacturing and delivery, to the computer resources we need. Welcome now to the on-demand workplace. It’s here to stay.

Marty Zwilling

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Friday, November 23, 2018

5 Inertia Traps To Avoid In Your Business Leadership

achieve-achievers-bannerWhile the willingness and ability to change is recognized and espoused by every business owner or founder I am asked to advise, far too many of you seem to be stuck in a rut, or very slow to actually decide what changes are necessary to survive and thrive. You may not be blind to the changing market and technology, but being blind to internal traps that can be just as devastating.

I saw this challenge of inertia described very well in a new book, “Transforming the Clunky Organization,” by Samuel B. Bacharach. From his leadership consulting with a host of companies, clunky and innovative, he explains why owners and executives fall into traps of inertia and he details the critical pragmatic leadership skills needed to regain the required momentum.

Here is our joint list of some common traps that you and your company leaders must avoid at all costs:

  1. Too satisfied with how things are going, or status quo. The status quo trap is set when things have gone well for a while, and you are too busy to look ahead to see what’s around the corner, or commit time and resources into developing the next generation of innovative ideas. Then when market demand slows, you are not able to react in time.

    For example, Blockbuster was so busy expanding its hugely profitable video rental business, adding stores at a breakneck rate, that it failed to really take notice of new entrants like Netflix with no late fees, Redbox automated kiosks, and video on demand. The result was a major change in the industry, and Blockbuster disappeared.

  2. Throw money into a sinking project, hoping to save it. This bailing-too-late trap is when you make a big investment in a venture that doesn’t take off, but you refuse to abandon it or pivot because of sunk costs, with the hope of success just over the horizon. The result is a business damaged past the point of recovery, instead of just dented.

    I see this often as an angel investor, approached by desperate entrepreneurs who have spent all their resources over a period of years on a failing solution, but are still convinced that one more cash infusion will turn the curve from down to up. At this stage, investors won’t believe that more money for sales and marketing will turn the tide, so we all lose.

  3. Tackle a new market or technology you don’t know. When you propose to enter a new market or technology without the requisite resources or skills to compete, you may be triggering the overreaching trap. Although paradigm shifts and disruptive technologies imply huge new opportunities, they may require more time and risk than you can tolerate.

    The Pebble smart watch is an example of overreaching, especially for a startup with limited resources. Even though the original Pebble became the most-funded Kickstarter product of all time, tech giants Apple and Samsung quickly overran them, and they were forced to disappear into Fitbit.

  4. Focus on short-term gains, ignoring long-term risks. Short-term wins are great, but if you pursue them at the expense of long-term success, then it’s a trap. Companies caught by the short-term trap often miss new bigger opportunities. Thinking short-term requires satisfying customer change with more already existing products, skills, and resources.

    Kodak is famous for falling prey to the short-term trap. At one time Kodak was a leading innovative company centered around film photography. Their short-term focus did not allow them to see the long-term benefits of digital photography, cost them their leadership position, and ultimately resulted in their filing for Chapter 11.

  5. Let your company be a victim of analysis paralysis. If you lead your business on endless journeys of analyzing, discussing, researching, and testing new ideas without getting anything off the ground, you are a part of the overthinking trap. You are guilty of wasting precious time and money, and throwing away the opportunity of real innovation.

The result of any of these traps is an inertia that prevents recognition of the need to change, and a sluggishness in implementing the necessary change actions before it is too late. If you sense these symptoms in your domain, or hear them highlighted by your advisors, the time to take action is now. I advise initiating a change in your leadership style, before the market moves on without you.

Marty Zwilling

*** First published on Inc.com on 11/08/2018 ***

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Wednesday, November 21, 2018

How To Network For Career And Business Advancement

network-business-advancementIt pays big dividends to network with peers and others if you want to succeed in business. You need to get guidance before you start a new venture, connections to investors as you seek funding to scale the business, and expansion and exit insights as the business matures. Just as importantly, your business network can actually make a sometimes lonely role enjoyable.

Yet networking effectively does take valuable time, and for some of us who are introverts, it’s not so easy at first. In working with many entrepreneurs and career professionals over the years, I have collected my own strategies which I offer to all of you as a place to start, and a focus on getting real value for your efforts:

  1. You make the first move – don’t wait for someone to pick you. If you wait for the right people to find you, it takes too long, or it may never happen. Take the initiative to find the ones you need, and do your research on how they can help you, how you can help them, what they like, and what you might have in common. Everyone loves initiative.

  2. Seek common interests and shared values beyond business. Chemistry and shared values lead to trust and lasting relationships, rather than shallow friendships. Examples would include sports interests, academic connections, and family activities. Whether the business topics are investing or mentoring, networking is personal as well as business.

  3. Be prepared to exchange business cards and follow up. Make the initial exchange of connection info a simple process, and don’t wait for the other person to initiate a personalized follow up within a few days. Let the relationship build slowly, rather than immediately launching into a marketing for investment pitch.

  4. Suggest a non-work meeting to cement the relationship. While the ultimate purpose of networking is a business benefit for all concerned, you will have more fun and better results if you learn to drop the assumption that networking is only a part of your work. Take advantage of those common interests that brought good chemistry initially.

  5. Have a mindset of giving more than you expect to get. In my experience as an investor, I loved the opportunity to hear about new technologies, but I was put off by entrepreneurs who immediately started asking me for money. Offer to share what you learned from some tough challenges, or provide some personal business insights.

  6. Keep all network interactions upbeat and positive. You won’t be successful with your networking by exuding negativity. You have to be the role model for the people you want to meet, and I’m sure you appreciate the value of can-do interactions and influencers, versus people who only want to commiserate or get you to solve their problems.

  7. Never use your senior position to control the networking. Some people have more senior titles, or substantial wealth, but they still have challenges and failures, just like the rest of us. I’m sure that Bill Gates and Warren Buffett, who have acknowledged a mentoring relationship after meeting via networking, never compared titles or net worth.

  8. Leverage existing networking relationships for new ones. The best way to meet the right new people is to get connected through good current connections. Hopefully, your existing connections know what you have to offer, as well as what you need, and recognize the benefit all around of being a connector. You should do the same for them.

In this age of rapid change, you need to be in constant learn mode to keep up, or potentially get ahead of the crowd. There is no better way to learn than to leverage the experience and knowledge of others.

Simply attending lots of conferences and events, and handing out hundreds of business cards, won’t facilitate that learning. Be strategic, proactive, and selective in your networking efforts, as suggested here, and you too will soon see the dividends.

Marty Zwilling

*** First published on CayenneConsulting on 11/08/2018 ***

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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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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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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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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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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 (sample templates), 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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