Platt Perspective on Business and Technology

Planning for and building the right business model 101 – 42: goals and benchmarks and effective development and communication of them 22

Posted in startups, strategy and planning by Timothy Platt on March 31, 2019

This is my 42nd 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 and Page 5 continuations, postings 499 and loosely following for Parts 1-41.) I also include this series in my Startups and Early Stage Businesses directory and its Page 2 continuation.

I have been discussing three specific possible early stage growth scenarios that a new business’ founders might pursue for their venture, in recent installments to this series, which I repeat here for smoother continuity of narrative as I continue addressing them:

1. A new venture that has at least preliminarily proven itself as viable and as a source of profitability can go public and with all of the organizational change and all of the transparency and reporting requirements that this entails as they begin offering stock shares. (See Part 33 and Part 34.)
2. A new venture can transition from pursuing what at least begins as if following an organic growth and development model (as would most likely at least initially be followed in exit strategy 1, above too) but with a goal of switching to one in which they seek out and acquire larger individually sourced outside capital investment resources, and particularly from venture capitalists. (See Part 35.)
3. And a new venture, and certainly one that is built around a growth-oriented business model, might build its first bricks and mortar site, in effect as a prototype effort that it would refine with a goal of replication through, for example a franchise system. (See Part 36 through Part 39.)

And more recently here, I have been analyzing and discussing all three of these business development options, in terms of how they address a specific set of key issues that any business that connects with and serves a market in any way, would have to explicitly focus upon if it is to succeed, and certainly long-term:

A. Fine tuning their products and/or services offered,
B. Their business operations and how they are prioritized and carried out, and certainly in the context of this Point A, and
C. Their branding and how it would be both centrally defined and locally expressed through all of this.

I began a discussion of the first two business development approaches as listed above: the IPO and venture capital supported scenarios, and how pursuing one or the other of them would explicitly impact upon, and in turn also be shaped by Point A decisions and follow-through, with an at least brief digression there into Point C issues as well, as that and Point A consequentially and therefore operationally overlap. My goal here in this posting is to conclude my Point A discussion at least for here and now in this series, by explicitly considering how its issues would impact upon a franchise or similar growth business model, with its drive towards templated consistency as a path to successful expansion.

I in fact began my discussion of that business model scenario this context in Part 41 with a brief orienting discussion of product and service consistency, and both as a (Point C) branding issue and as a source of economy of scale and other value. Ultimately, franchise systems that succeed as such, tend to be consistent in what they do and in how they do it and in what they offer, and in the types of market and consumer-facing venues that they would conduct all of this through. That at least forms their basic business-defining patterns and both as a system of reliably consistent franchise outlets that a steady customer base would turn to, and as a reliable steady pattern that they can continue to grow from, from that.

At the same time, however, franchise systems have to be flexible in the face of overall marketplace trends and shifts, and in the face of more local-community needs and preferences too. And this means their capacity to both meet local needs and to prototype and test new offerings and new business approaches that might in fact become their new next overall system-wide norm or at least components of that.

• I wrote in Part 41 of the constraints and shaping pressures that businesses face and particularly in my discussions of the IPO and venture capital scenarios under consideration here. I would continue to use the term “shaping pressures” here in this context as well, but note that the constraints that I could cite in this narrative can be enabling and expanding as easily as they can be restrictive and limiting. In fact, and here I write with all three of the above business model scenarios in mind, successfully pursuing any of them of necessity means a business’ owners and senior managers being able to successful tip the balance there, where “enabling and expanding” outweighs any also-faced “restrictive and limiting” and both for operational flexibility and capability and for the business’ overall profitability and longer-term prospects for that.

And turning back to explicitly focus on franchise or similar templated growth and development scenarios again, this leads me directly to the issue of how such a business would in effect standardize and mainstream change and the testing and allowance of new and different into its systems, and as a matter of both what they do and how, and as a matter of branding and how they market and present themselves to the public too, as I will delve into in a Point C discussion that I will offer in a soon to come installment to this series.

I have already begun addressing the above Point B and its business process and operations issues in this posting and will explicitly focus on that complex of issues in my next installment to this series. And then as promised above, I will explicitly turn to and consider Point C and its issues as a separate topic area. And I will continue to draw out points of connection between these areas of consideration while doing all of this.

Meanwhile, you can find this and related postings and series at Business Strategy and Operations – 5, and also at Page 1, Page 2, Page 3 and Page 4 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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