Platt Perspective on Business and Technology

Planning for and building the right business model 101 – 21: goals and benchmarks and effective development and communication of them 1

Posted in startups, strategy and planning by Timothy Platt on June 14, 2016

This is my 21st posting to a series that addresses the issues of planning for and developing the right business model, and both for initial small business needs and for scalability and capacity to evolve from there (see Business Strategy and Operations – 3 and its Page 4 continuation, postings 499 and loosely following for Parts 1-20.) I also include this series in my Startups and Early Stage Businesses directory and its Page 2 continuation.

I wrote Part 20 with a goal of outlining some of the key issues that can and do arise in a startup and early stage business context, when communications gaps and the inefficiencies that they create, arise. And then at the end of that, I stated that I would turn to consider goals and benchmarks, and I will in fact do so here. But at least for purposes of this series installment, that means taking my more generally stated discussion of business systems friction and communications challenges in those beginning business creation and development stages, out of the abstract.

• Business founders and their early teams need to select and prioritize goals that they would work towards in building their new enterprise.
• And they need to select and come to agreement on basic performance benchmarks that they would use in determining how effective they are in working towards and achieving those progressively determined, development-step by development-step goals.
• And all of this requires ongoing effective communications where all relevant stakeholders are included in necessary conversations that would be needed to make all of this work.

I wrote in Part 20 about business founders who seek to retain overall control of their new business enterprise by controlling access to essential information, and even within their own key founding team.

• Goals and priorities, and capacity to come to agreement on where they are needed in the business development process
• And what they should include and with what priorities, are the crucially defining points where communications in a newly forming enterprise either function or not
• And where communications failures can and will have the largest possible adverse consequences.

It is when a business attempts to set and come to agreed understanding on their overall goals and priorities, that business friction takes its real toll. And this is where a beginning and still forming company will die if it does so in one of its beginning stages. I am not attempting to argue a case here that business systems friction and the communications challenges that create it are the only things that can go wrong in a new business venture. But while they are not the only causal factors that would contribute to failure to thrive there, they are usually at least significant contributors when a new business does get into trouble.

So this is in fact a posting about goals and benchmarks and setting them and pursuing them. But it is also, and very significantly a posting about business communications too. Businesses live or die according to how effectively they can communicate, or fail to do so. And goals and priorities represent an area of communications need and operational execution that overall business success grows from, or fails to.

I ended Part 20, having discussed business communications in this context, essentially entirely in the abstract. And then I began this Part 21 installment by reframing that line of discussion in terms of what for most startups and early stage businesses, are the key specific areas where friction and communications problems that cause it, would have the greatest adverse impact. But up to here, I have taken just as abstract an approach to goals and benchmarks per se, that I took to key communications per se in Part 20. So I turn now to at least begin to consider goals and their benchmarks in more detail. And that very directly and solidly connects this line of discussion back to the title issues of this series as a whole: business models. And I begin there and with the absolute fundamentals:

• A good, effective business model is a living, dynamic entity that is subject to change and growth as the business that it represents develops and forms, and as it with time grows too. A good, effective business model is responsive to change, and both as challenges and opportunities emerge – and even when they arise unexpectedly.
• And a good business model has built-in resiliency and flexibility, and especially for when the unexpected and unpredictable arises.
• And strategic and operational execution of that business model, keep the business on track and aligned with the business model in place. And they in practice, are developed and maintained with a meaningful awareness of what “on track” means there – with this accomplished through an ongoing step by step process of setting short-term ongoing, and longer-term goals, and performance evaluation benchmarks that would meaningfully support all of them.
• When communications break down at the top, higher level goals and their benchmarks become skewed and out of focus, as people working under them attempt to discern what they should be doing to help achieve them, and have to come up with their own interpretations of them to even try.
• When communications break down lower down on the table of organization, higher level operational and strategic planning come to be made in an information vacuum, and without meaningful feedback or insight from where they have direct day-to-day impact on how they work, or even if they do so at all.
• And when the types of vertical communications challenges that I write of here develop, that is when local teams and separate areas and domains within the overall table of organization begin to break away, forming solid and impermeable protective walls around themselves that further limit effective overall communications. And the overall level of friction in that business increases even more, and this enterprise is at greater risk of finding itself faced with what can easily come to be a seemingly open-ended ongoing decrease in its capacity to be competitively effective overall.
• I just wrote that in terms of a business that has already started to grow out a headcount and develop a staff of lower level managerial and non-managerial employees. But as I have already indicated here, it is possible for a founding team that can fit around an initial founder’s dining room table, to achieve these same problems too.
• And the types of larger scale business challenge that I have just addressed in these bullet points, usually have their origins in that small initial founding group when they arise at all, and in bad practices that in effect come to be built into the very DNA of that business and from before it can really even begin to scale up.

And this brings me to the questions and challenges of selecting and setting goals, and of determining what performance benchmarks are realistically achievable, and in some crucial sense necessary to achieve too. I am going to discuss those issues in a next series installment, and taking a page from Personnel evaluation approaches, I will do so in terms of goals and stretch goals, and also in terms of fallbacks and plan B alternatives too, and knowing when you are facing need and opportunity in any of these possible directions.

Meanwhile, you can find this and related postings and series at Business Strategy and Operations – 4, and also at Page 1, Page 2 and Page 3 of that directory. And you can find this and related material at my Startups and Early Stage Businesses directory too and at its Page 2 continuation.


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