Platt Perspective on Business and Technology

Planning for and building the right business model 101 – 32: goals and benchmarks and effective development and communication of them 12

Posted in startups, strategy and planning by Timothy Platt on October 13, 2017

This is my 32nd 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 1-31.) I also include this series in my Startups and Early Stage Businesses directory and its Page 2 continuation.

I began discussing three specific exit strategies in Part 31, in the context of discussing exit strategies per se and what that term actually means as a stage of development, fundamental change-based transition point:

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.
2. A new venture can transition from pursuing an organic growth and development model (as in exit strategy 1, above) but to one in which they seek out and acquire larger outside capital investment resources, and particularly from venture capitalists as briefly touched upon in Part 28, Part 29 and Part 30 of this series.
3. 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.

And at the end of that series installment, I stated that I would continue its flow of discussion here, examining these same three transitional changes in greater detail and in terms of goals and benchmarks, and communications issues as they play out in businesses going them.

• If I were to summarize the basic set of topics that I will at least begin to address here, in a single brief phrase, it would be to note that my goal here is to at least briefly outline the core generic elements of the How, of strategically mapping out and evaluating basic business transition options moving forward, on the basis of specific, carefully gathered, organized and evaluated and communicated empirical evidence.

This overall flow of business process and review steps has, or at least should have its roots in the normal and normative day-to-day practices followed by business owners and their leadership teams as they manage their businesses in the face of more routine change and uncertainly. Efforts to develop and follow effective review and evaluation processes in the face of impending disruptive change, which true business transitions always involve, cannot work for people who have not already built an effective foundation for that from well considered evidence based business management practices, as carried out in the face of simpler, routine change and variety as arises every normal business day. And I will add that the data and insight gained from this more normal and every day review and analysis practice, serves as essential baseline data and both for identifying need for more significant change and early on, and for more effectively planning and preparing for it.

In the context of this series and this portion of it, that means knowing when and how one or another, or one or more of the above three listed exit strategies might be starting to make sense, and how and why. And this posting is all about looking at and measuring and tracking the right performance metrics and looking for and documenting exceptions and exception handling, as need for that arises, and as a part of that same business analysis process.

The goals and benchmarks of this, need to be realistic and that means they need to be clear and precise and framed in terms of the business performance measures actually followed. Subjective can be vitally important here, and certainly when that means coming to an awareness that not all of the right types of data and insight are being considered here. But ultimately, this analysis and the raw data that enters into it need to be objective and specific; subjective impressions and estimates cannot offer any real value and certainly when it comes to the supposedly raw business data that is going to be used for this type of business analysis.

What should you look for here, as measured objective data and as sources of it? Look to the basic business model and what the business does that collectively would, or at least should make it profitable and effective enough in its marketplace to reach that goal and stay there. And at least start addressing all of that, in the financial terms of cash flow and availability, and costs and returns on investment and how systems fit together in those terms. And as this is a business transitions type of analysis under consideration here, look both short-term and longer-term, and project outward according to two distinct models:

• What happens if the business simply continues on with a business as usual approach for the area of the business under immediate consideration here?
• What options might be available for disruptively breaking away from that old pattern and in a new way?
• And what would variously happen if one of these transitional changes were entered into, pro and con, short-term and long?

Ask this of each of the options considered in the second bullet pointed question here, in terms of the basic metrics used for your ongoing business analyses, as augmented where and as gaps in what they can tell you become apparent. And remember: any gaps and uncertainties in how you would answer these questions, represents risk faced from pursuing whatever approach: whatever next step development model that is under direct consideration at the moment. Here, risk represents cost and potential loss faced, and at least ideally for capability to measure and determine, as a product of the sum of direct and indirect costs faced if an adverse event were to occur, as multiplied by the chance that it would take place (as measured as a proportion – e.g. a 1% chance of occurrence represented by the fraction .01 and so on.)

This addressed what is considered, and certainly as a first step analysis where it would become clearer that problems and challenges might be arising. Now consider which stakeholders are included in these conversations, and really involved in them: not just in the room but silently so.

• Effective inclusion here in these conversations is essential for finding better approaches for addressing the gaps and challenges identified here, where a best path forward might mean pursuing some particular type or combination of basic exit strategy options as noted above, by way of those three possible examples.
• It means more effectively and fully characterizing and understanding the gaps and problems faced that would go into that type of determination.
• It means more effectively arriving at workable approaches for carrying out any necessary changes that are agreed to.
• And this is essential for gaining buy-in so the necessary changes and all the work that enters into them, are actually done and in a coordinated manner by all necessarily involved stakeholders.

I have been writing here in general and relatively abstract terms. I am going to delve more into the specifics in my next series installment where I will consider exit strategy 1 from my above list of three in detail: the fundamental change scenario of a business going public with all that that entails. After that, I will more specifically consider each of the other two exit strategy scenarios under consideration here.

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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Building a business for resilience 24 – open systems, closed systems and selectively porous ones 16

Posted in strategy and planning by Timothy Platt on October 11, 2017

This is my 24th installment to a series on building flexibility and resiliency into a business in its routine day-to-day decisions and follow-through, so it can more adaptively anticipate and respond to an ongoing low-level but with time, significant flow of change and its cumulative consequences, that every business faces in its normal course of operation (see Business Strategy and Operations – 3 and its Page 4 continuation, postings 542 and loosely following for Parts 1-23.)

I have been working my way through a communications and information sharing-oriented to-address list in this series, since Part 20, which I repeat here as I continue analyzing and discussing its issues:

1. Thinking through a business’ own proprietary information and all else that it has to keep secure that it holds.
2. While reducing avoidable friction where there can be trade-offs between work performance efficiency, and due diligence and risk remediation requirements from how information access is managed. This, in anticipation of discussion to come, means consideration of both short-term and long-term value created and received, as well as short-term and long-term costs.
3. And this means thinking through the issues of who gathers and organizes what of this information flow, who accesses it and who uses it – and in ways that might explicitly go beyond their specific work tasks at hand.
4. What processes are this information legitimately used in, and who does that work? With the immediately preceding point in mind, what other, larger picture considerations have to be taken into account here too?
5. And who legitimately sees and uses the results of this information as it is processed and used and with what safeguards for the sensitive raw data and the sensitive processed knowledge that are involved, where different groups of people might have legitimate need to see different sets of this overall information pool?
6. Think in terms of business process cycles here, and of who does and does not enter into them.

More specifically, I began addressing Point 3 of this list in Part 23 , doing so in terms of two categorically distinct types of communications channels that arise and flourish in business contexts:

Hard communications channels are formal business process and official communications pattern-driven, and become rules defined for what information can be shared with whom and under what circumstances, and essentially whenever an information access due diligence or risk remediation system is put in place.
Soft communications channels arise as employees network with and share information with colleagues outside of the scope of any formally considered hard communications channels in place, in order to more effectively carry out their jobs. These communications channels can be thought of as representing work-arounds of convenience and even of necessity. And they can become highly standardized too, and certainly where they are consistently found to work.

I suggest you’re reviewing that installment for a more detailed discussion of these business communications approaches and how they arise and function. I simply assume those details as offered there in this posting, as I continue my discussion of Point 3 of the above list.

I stated towards the end of Part 23, that I had been addressing the issues of Point 3 and in fact of Points 1 and 2 as well, from an essentially entirely in-house perspective and in terms of full time employees at a business: hands-on non-managerial and managerial included. And I said that I would shift directions here, to consider a wider range of possible participants and certainly for how they would enter into a Point 3 discussion, including “part-time and temporary help in general and outside-sourced consultants in particular, and how they do and do not enter into essential conversations.”

I begin this by frankly acknowledging that I framed that in a manner that is becoming at least incrementally more obsolete, every single day. That point of observation: that claim and its consequences is in fact crucially important to this posting and this series. So I begin the core discussion of this posting by at least briefly explaining how and why it is valid, and by sharing some thoughts as shared with me by others, from conversations that I have had with colleagues going back as far as a dozen years and more now. The issues that I would raise here are not so much new and sudden, as they are developing and emerging, and with that meaning their just starting to reach an unavoidably impactful threshold of significance that can no longer safely be ignored.

I have never specifically worked in Human Resources or Personnel, even if I have at times held positions that included those services in my overall area of responsibility. And I have worked closely with specialists and generalists in those areas of expertise, and in a variety of businesses and industries, and have some experience helping them develop and improve their systems.

The professionals who I cite here for those telling conversations are all people who have worked in-house in established businesses, as senior HR professionals, who have gone on to work as job search and career development professionals. And as long as a dozen years ago and more now, we have found ourselves comparing notes – and at least informal research findings on how often professionals have to change both jobs and even career paths in the course of a work life. When my father and his began their work lives most people could expect to stay in essentially the same field of work and in the same industry until they were ready to retire. It was in fact still common for a professional to work for the same business from early on in their work life until they reached retirement. But by the time I began working it was increasingly common for professionals with specialized and advanced training and experience to have to make at least some fundamental career changes, and into new to-them fields, at least once and even a few times in the course of their work life. The steady predictable path of my father and my grandfathers is long gone now and a recent college graduate can expect to make fundamental changes in what they do and in the types of businesses and organizations where they do that, six, eight, ten and more times over the course of their work lives. And a dozen and more such changes will not be uncommon.

Long term stability and constancy in work and employment has given way to ongoing change and an ongoing need for resiliency and adaptability. And I have written several series to this blog with titles such as:

• Bringing the Job Market and Marketplace into Focus (see Guide to Effective Job Search and Career Development, postings 89-102),
• Career Changes, Career Transitions (see Guide to Effective Job Search and Career Development – 2, postings 285-305), and
• Developing a Career out of Gigs and Short-Term Work (see Guide to Effective Job Search and Career Development – 3, postings 368-675)

as well as a fairly significant number of stand-alone postings that also appear in those three directory pages that address this emerging fact. And my goal in them has been to both identify and discuss how the workplace and employability are changing, and to offer best practices approaches to more effectively navigate the jobs and careers challenges that this “fluidity” in the workplace creates.

My overall point here is that people as individuals cannot realistically think of themselves as working for any one employer long-term and seemingly forever. And no one can safely assume any workplace: any employer as their sole employer for as long as they work. And they should expect, and they should be continually preparing for change and in both where they work and in what they do when working. And turning this discussion around, to return it to the orientation of this series: businesses have to think and plan in these terms too when thinking and planning for and in terms of their ongoing workforces. And they have to find ways to both function and to succeed in the face of this churn in their personnel and at all levels and for all types of work positions offered, and where even their best employees might be looking for better opportunities elsewhere; this churn does not all arise from employer-sided decision making.

I have been writing about non-compete clauses and agreements in this series, and I cite them again here, to put them in a perhaps clearer perspective. Businesses that use and in fact overuse and misuse these legal mechanisms are not necessarily doing so with a goal of attacking or harming or limiting their employees or would-be employees, and certainly not as a general rule. They are attempting, however awkwardly, to protect themselves in the face of what they can and often do see as a hemorrhaging of necessary skills and experience from their workforce, and certainly in seller’s job markets where there are more positions in need of good people than there are really good potential hires to fill them: an essentially constant situation for rarer high demand and high need skill and experience sets as arise in any rapidly changing industry or field.

And this brings me back to that quote from the end of Part 23, regarding “part-time and temporary help in general and outside-sourced consultants in particular, and how they do and do not enter into essential conversations.” I have been arguing a case in this blog and throughout its Guide to Effective Job Search and Career Development for people to take a consulting approach to their work and to jobs held and in their career development. This does not mean explicitly working as an outsider and never taking an in-house job. As an intentional and long-term consultant, to cite my own experience there, I took in-house jobs a number of times, with open-ended opportunities for continuing on there, at least in principle, as well as going to work for employers as a consultant and one who would work there only until specified goals or benchmarks had been reached. This does mean never thinking “permanent” as a part of any job description agreed to, and with an up to date resume and an active professional network reach to prove that – and even if you only look for in-house full time positions.

• Let’s reconsider the basic arguments and points of Part 23 from the perspective of ongoing change that I raise here, as my next workplace and terms of employability disruptive change that I would discuss in this series:
• A blurring of what in-house full time employment, and outsider consultant and part time mean.

I am going to build from that and from Part 23 of this series as originally stated in a next series installment, where I will reframe business communications from a wider perspective where in-house and outside-sourced are becoming increasing fluid and blurred for who works where, and certainly as traditionally conceived. 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.

Technology as the tide that raises all boats 11 – but often unevenly 8

Posted in outsourcing and globalization, reexamining the fundamentals, strategy and planning by Timothy Platt on October 7, 2017

This is my 11th installment to a discussion that I initially began as a single stand-alone posting in April, 2012, but that needs reconsidering. I focused in that posting, on a key issue that enters into a determination of how and when change rises to a level of significance so as to qualify as true innovation (see Outsourcing and Globalization, postings 25 and loosely following for Parts 1-10, and Part 1 of that in particular as the foundational urtext for this narrative.)

The at-times conflicting dynamics of innovation entry into, and acceptance in the marketplace are crucially important to the narrative that I have been developing here in this series. So I explicitly addressed two of the more overtly significant aspects of that in Part 9 and Part 10:

• Availability and accessibility of New in the marketplace (at all, and at an affordable cost there),
• And level of comfort and of willingness to adapt New, and how soon after it first appears as a marketplace possibility.

My goal for this installment is to address something of the underlying mechanisms of these dynamics, and certainly in an increasingly ubiquitously connected context, with a focus here on friction in these systems. And in the course of discussing and analyzing that, I will explicitly consider how both cultural and socioeconomic forces impact upon and help to shape innovative change and the opportunity for it as it advances forward all around us.

I begin addressing all of that by posting a basic and even fundamental question, that I have in fact answered at least in part, a number of times in the course of developing and writing postings and series to this blog:

• What is friction in this context?
• I start with a well established approach to answering that: with friction as that term is used in economic theory and as a general organizing principle there. Economic friction is resistance to systems efficiency as that arises from a lack of essential information, clearly stated and available when and as needed. Friction is the consequence of having to make economic and financial decisions absent even crucially necessary information at the time of decision making, that would be required in order to knowingly make a best decision then. Think of this as sand thrown in the gear box of Adam Smith’s invisible hand, where marketplace and economic system participants cannot make what would be the best decisions for themselves or for others (who for example, they might hold fiduciary responsibility toward), as they lack the information and insight that would be required for that. Economic friction is a measure of the consequence of faulty and limited information and its communication and it shapes the overall systems that it arises in, and the outcomes and consequences of decisions made in them.
• I adapt that basic term and its definition to the organizational level of the individual business with a matching term: business systems friction. And I apply that term at the level of the overall business or organization as a whole, and at the level of functional and other supposedly tightly connected functional subsystems that arise within the complete organization (e.g. as separate and distinct lines on a table of organization under single lines of leadership there, or as separate and distinct offices or facilities that formally belong within the business but that also function at least somewhat autonomously within it.) Looking outward and in the other direction for organizational scale, I also apply this term in the context of supply chain and related value chain systems, with the functionally interconnected and interacting businesses that enter into them, all collectively brought under direct consideration here.
• And here and in this context, I continue expanding the range of organizational levels that I would apply the basic term “friction” to, to consider individuals and social network and marketplace connected groups of them. Yes, the basic issues that I would encapsulate in what I will say here and in this context, have their counterparts within businesses and in groups of employees, and I would tend to include that context within the general rubric of business systems friction too. Here, I will focus on what I will categorically carve out as a more consumer and marketplace manifestation of friction. (Yes, this could reasonably be folded into the general economic friction definition, but I separate it out to consider this set of phenomena from an explicitly more micro-level.)

Consumers and marketplace participants in general, make their decisions to purchase or not to purchase on the basis of limited information, and in the face of faulty and at times even significantly limited and even contradictory communications. This is obvious when considering rapidly changing industries and their products, where consumers do not for example necessarily know when a newer and better next technology updated product will come out as they make their next purchasing decisions now. It also applies to the questions of quality and reliability, ease of use, and value of the features offered, in what they have to consider for purchase and even when they know that a new purchasing option is available to them. That is why crowd sourced and other (presumably) consumer product reviews are considered to be so valuable as an increasing common due diligence resource, and for so many. But even then, how can you tell if a negative review is the legitimate expression of opinion of a real product user, or just a troll attack fraud and perhaps one posted in subversive support for a competitor? How can you tell if a glowingly positive review is legitimate, or a fraud too, and even one directly posted by the product manufacturer or provider, or posted for-fee on their behalf? Information is always going to be incomplete and imperfect. And it can be difficult and even impossible to know precisely what to make of the marketplace information and perceived knowledge that is visible and available, that could be applied to purchasing decisions.

But this tells only one half of the story that I would make note of here. For purposes of this narrative, the second half might be even more important: the asymmetry in both the information available to, and the levels and types of information accessed by individuals in the overall marketplace, depending on where they most comfortably fit into a relevant innovation acceptance diffusion curve.

I admit that I am offering a more stereotyped assessment here, but add in its defense that in this case that simply means accepting the basic functional definitions of terms like pioneer and early adaptor on one end of the scale, and late and last adaptors on the other.

• When a new product, and particularly a disruptively novel one first arrives in the marketplace, the first people to see it are often published new product reviewers who tend themselves to be early and even pioneer adaptors. And they focus on all of the new details and their strengths and weaknesses, but from a New accepting and even New-embracing perspective. Pioneer and early adaptors who are drawn to the New and Different, tend to be drawn to these reviews and to make their own reviews and assessments of the product details offered too, through online social media. So their decisions to buy in or not, tend to be granular and detailed and on a specific New product level. And they tend to be shared through like-minded communities.
• Late and last adaptors do not generally read these types of reviews – ever. And they do not in general post or share their specific reviews or opinions either, and certainly not online in the manner that early adaptors do. They start out with a presumptive, more categorical bias against New and Different per se, at least until value has been proven in others’ hands as safe and reliable enough to meet their due diligence requirements and on a “once new” by “once new” basis. So their approach here is essentially by definition anything but fine grained and granular in nature and it does not enter into widely shared review and evaluation conversations. Outside sourced information that they would seek out and accept in this, is in large part evaluated in terms of how it does or does not support their basic a priori conclusion-based due diligence approach which is more risk aversive than benefit accepting in nature.
• And mid-stage adaptors fit in the middle there, looking both outward for details of the specific products that have come out to see how they might work for them, and both outward and inward for threat assessment driven risk management decision making. They also want to see at least some prior user experience as necessary input for their risk and benefits evaluation, but they are not entirely driven by that in their purchasing and usage decisions.
• That raises an important point. Both early and earliest, and late and last adaptors carry out risk and benefits assessments (and so do middle ground adaptors.) It is just that early end of the spectrum adaptors tend to weigh possible benefits more heavily than they do risks and late and last adaptors tend to reverse that. For a very real world, clarifying example there, consider government agencies such as the United States FBI and particularly when they seek to upgrade their computer network and file and data management systems. They do in fact look into the technical details and in more detail than essentially any early adaptors would or could. It is just that by the time they have finished their multi-stage vetting process for that, what began as new and cutting edge can have become old and even obsolete. This is not a fictionalized example; I am in fact briefly recalling a specific failed attempt at a massive, information systems upgrade in the FBI that collapsed around the time I first began writing to this blog. Possible risk was viewed as so outweighing possible benefit that nothing positive was, or could be achieved from that upgrade attempt, that ended up costing the US government well over a third of a billion dollars and with nothing to show from it in the way of new technology in place and in actual use.

There are a number of salient conclusions that could be drawn from this comparison between early end and late end adaptors as considered from an innovation diffusion and acceptance curve perspective. One that I would point to here is that most late adaptors seek out much less outside information and much less new product-specific information than do early adaptors ( my FBI example notwithstanding, as a perhaps rule-clarifying exception.) And this difference in the levels and range of sources of information sought out, and of the range of conversation flows entered into, mean fundamental differences in the types and sources of friction faced when making these purchasing decisions, and when determining the timing of those decisions, for those two groups.

I said towards the top of this posting that I will consider “both cultural and socioeconomic impact as innovative change and the opportunity for it advances all around us.” I will more explicitly delve into those issues and into the issues of early and late adapting communities in my next series installment. I simply add here and in anticipation of that, that this set of issues becomes definingly important in a ubiquitously connected, social media driven context that we now live in. (I will question that assertion in my next installment too, as part of its discussion.)

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. I also include this in Outsourcing and Globalization – and see that directory for related material. And I include a link to this posting as a supplemental addition to Section VII: Reexamining Business School Fundamentals (reconsidered), of Reexamining the Fundamentals too.

Balancing innovative change and ongoing reliable stability and consistency 8: strategic thinking, planning and execution 5

Posted in strategy and planning by Timothy Platt on October 5, 2017

This is my 8th installment to a series in which I explore tactical and strategic approaches to business management and leadership, and best practices approaches for coordinately pursuing both as context dictates. See Business Strategy and Operations – 4, postings 655 and loosely following for Parts 1-7.)

I have been successively discussing a set of to-address points in this series since its Part 5, that I repeat here for purposes of smoother continuity of narrative:

1. I will move on in this narrative to discuss the questions of identifying disconnects between strategy and tactics, and as early as possible when they do arise.
2. And I will consider and discuss startups, as a business context where founding executives can find themselves facing learning curve challenges in understanding and addressing the issues that I raise here,
3. And the sometimes significant challenges that large and complex business organizations can create in aligning strategy and tactics, with effective disconnect identification and remediation implemented, as a core ongoing due diligence process.
4. And I will return again to my starting case study example for this series, to consider lessons learnable and remediative approaches that might be possible for that business – and at least some of the trade-offs that would have to be resolved in that too.
5. And that is where some very specific, crucial negotiations-related issues enter into this series’ narrative.

I have delved into each of the first three of these points since then, leading up to and including my Part 7 discussion and analysis of Point 3 and its issues. And that has brought me to a set of specific topic points that I would turn to here in this installment, that all fall in at least large part within the aegis of a single overarching label: the challenge of remediation, in explicitly identifying and correcting strategy/tactics disconnects.

My goal for this posting is to at least begin to address this thread to this series’ overall discussion. And then when I have the basic foundation in place for continuing on from there, I will address Points 4 and 5 from the above list, returning full circle to the case study example that I began all of this with, in its Part 1. But I begin all of this with an at least starter discussion of remediation here, and with the fundamentals for that, as would be more generically applicable and for most any business context where strategy as centrally planned, and tactics as specific-point-of-action are carried out, collide. I begin this with the issues of communications.

Business communications have become one of the central organizing themes for this blog as a whole, and with that in mind, I offer some orienting reference links that clarify my basic approach to it. I begin that by noting a specific series that I offered from the perspective of the individual as we seek to secure and thrive at specific jobs and as we develop and pursue longer-term career paths:

• Communicating More Effectively as a Job and Career Skill, as can be found at Guide to Effective Job Search and Career Development – 3, postings 342-358.

Ultimately, all communications in businesses take place between individuals – and even when you consider documentation that is developed and entered into archived storage as part of an ongoing permanent record. True, the creator of a given message might not know who or when their documents might be accessed and used, or the circumstances in which this might take place. But ultimately, it is individuals who enter into even these communications processes and on both the message creation and the message receipt and use sides of any communications transactions that ultimately arise. So I focus on the individual here, when focusing on the communications process per se.

And the other basic reference that I offer here is one that I first wrote as part of a longer, loosely organized series on leadership per se, with each installment examining that general, overall topic through the lens of a single, distinct quality or circumstance that a would-be leader might face.

When Leadership Means Accepting the Need for Unpleasant Conversations.

It is rare that a conversation about an ongoing problem or challenge at a business would seem pleasant, and whether that means confronting the problems of an individual employee or manager, or facing and addressing a more wide-ranging issue that involves larger areas of the business as a whole. Leadership, in the sense addressed in the second of these references, is all about more effectively enabling and carrying out conversations about problems and challenges, and where people can feel and act defensive, and without recriminations that can only create still greater defensive barriers: barriers that limit or even prevent effective resolutions if unresolved.

Resolving, and even just effectively identifying strategy and tactics disconnects depends entirely upon effective communications. And that definitely applies when the challenges in place include strategy/tactics disconnects, where professionals who have invested in the approaches they follow, find themselves in this type of disagreement in understanding and action. I will continue from that starting point observation in my next series installment, where I will more fully delve into the issues of finding a common ground of understanding, and actually remediating these challenges.

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.

Don’t invest in ideas, invest in people with ideas 33 – bringing innovators into a business and keeping them there 16

Posted in HR and personnel, strategy and planning by Timothy Platt on October 3, 2017

This is my 33rd installment in a series on cultivating and supporting innovation and its potential in a business, by cultivating and supporting the creative and innovative potential and the innovative drive of your employees and managers, and throughout your organization (see HR and Personnel – 2, postings 215 and loosely following for Parts 1-32.)

I focused in Part 32 of this series on the issues of encouraging and supporting, and retaining creative employees that you might already have in your business – who all too often are typecast as if they could only do well at the routine and even rote tasks that they are doing now.

• Businesses can and all too often do hemorrhage talent from their ranks, and without even knowing what they are risking and losing as they do this, as managers in pursuit of the routine in their task completion lists, fail to look beyond that to see what their teams and the people in them could do.

So I wrote about non-managerial, hands-on employees in Part 32, as a source of what could be innovative excellence and for at least some crucial fraction of the workforce in place. And I ended that by noting that I would at least begin to discuss how to better address this challenge here. I will do that. But first, I need to expand out the range of the Who side to this topic as considered here, by including frustrated managers who are stymied as their creative drive and potential go unrecognized too.

Non-managerial employees who do essentially all of the direct hands-on work at any business of any size, are an obvious fertile ground to look through for unrecognized and unappreciated creative potential. There are, after all, usually more people in that overall category than there are people with managerial and supervisory responsibilities in a business. So this is an obvious place to begin – and certainly as hands-on employees tend to have a lesser voice and a shorter reach in expressing it than managers do, and certainly when mid-level and higher level managers are considered. But it is vitally important to look for and identify, encourage and develop and support the innovative potential in the management team too, and certainly in the pool of lower level and mid-level managers in place, who take more orders overall than they give, and certainly within the managerial ranks where their own areas of responsibility and action are determined.

What do you look for there? I would begin answering that question by noting what you should look for in non-managerial employees too, who have managerial and leadership potential, as that means looking for the same traits that you should look for in already-managers who have real potential for further professional growth and advancement. Look for people with:

• Good, strong communications skills,
• Who can work well with others,
• And who do not work in a rut of only seeing their own here-and-now immediate tasks at hand.

Look for the people in your business who routinely see and think in terms of bigger pictures, and how individual efforts fit together, as well as the details that they have to work on. And look for the people there who think in terms of how larger parts of the business do and do not fit together effectively and how and why: larger ranges of the business than are encompassed by their own direct workplace responsibilities.

Note that I did not add wider hands-on expertise or unusually impressive technical skills there as general identifiers of leadership and management potential. And I did not include anything like an ability to expertly do a wider range of jobs hands-on themselves, than they are held responsible for now in that either. This is because good managers and leaders facilitate the people who work with them and under their supervision, to do better at their areas of expertise. And they help them to work together more effectively, and in a more smoothly coordinated manner. A good leader: a great leader excels in organizing larger efforts to meet larger goals in carrying out larger tasks and even when they do not have the hands-on expertise needed to actually take over for anyone on their team.

They do need to know the basic issues and the language of their area of responsibility and well enough to be able to ask the right questions and convey the right information to others. And they need to know enough of the more technical side to what is being done for them to be able to tell when they are being given good answers, incomplete answers that need to be further developed … or obfuscating jargon and the ineffectual and non-answers that sometimes also arrive on a manager’s desk.

• And in the context of this posting, a good manager has to be able to work effectively with the new and the uncertain,
• And when and how to support and advocate for those who seek to create new and positive through innovative effort, and when to more highly prioritize more basic and routine tasks that others in the business depend on their doing and completing.

Look for non-managerial staff with the capability and the interest in moving into positions where they would manage and lead others, developing and exercising their potential in that direction. Look for mangers who could effectively advance to greater and more wide-reaching levels of authority and higher up on a table of organization. And strive to facilitate this and even if you do not have a simple solution as to how right now, with a clearly defined opening on your table of organization at this time, so you do not end up watching your best walk out the door in frustration – and certainly not avoidably.

And with Part 32 and this installment up to here in mind, I add:

• Look throughout your organization for unmet potential that can be developed and encouraged and supported as sources of positive value for your business,
• And look for ways to more effectively capitalize on this potential – and even when that means you’re being creative in finding new ways to do that, that do not simply fit your perhaps cookie-cutter, linear business growth pattern in place.

This does not mean you’re never losing talent and even extraordinary talent from your workforce; it does mean striving to limit that loss and at all ranks in your business where that can realistically be achieved.

And with this 900 plus word start to this posting, I finally at least begin to address something of the How of all of this. And this means delving into two basic categorical types of communications that shape the employee and the manager experience, and what they are allowed to do, and what they are required to do at work:

Structured and even formally structured communications, as arise for example in the context of annual performance reviews with their pre-vetted review forms and protocols, and
Unstructured communications, as tools for arriving at unexpected insight and types of it.

I am going to delve into those issues in my next installment to this series, and use that as a starting point for discussing best practices in identifying and cultivating innovative potential in a business. 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. Also see HR and Personnel and HR and Personnel – 2.

Leveraging social media in gorilla and viral marketing as great business equalizers: a reconsideration of business disintermediation and from multiple perspectives 4

Posted in social networking and business, strategy and planning by Timothy Platt on October 1, 2017

This is my fourth posting to a series on disintermediation, focusing on how this enables marketing options such as gorilla and viral marketing, but also considering how it shapes and influences businesses as a whole. My focus here may be marketing oriented, but marketing per se only makes sense when considered in the larger context of the business carrying it out and the marketplace it is directed towards (see Social Networking and Business 2, postings 278 and loosely following for Parts 1-3.)

I initially made note in Part 2 of this series, of two specific business scenarios:

• A new, young, small startup that seeks to leverage its liquidity and other assets available as creatively and effectively as possible, and from its day one when it is just starting to develop the basic template that it would scale up from,
• And a larger, established business that has become at least somewhat complacent and somewhat sclerotic in the process, and with holdover systems and organizational process flows that might not reflect current actual needs or opportunities faced.

And I focused, and certainly in Part 3, on the second, larger and more established business type, under consideration here.

The first of these business scenarios is relatively obvious and intuitively so by comparison. New, small businesses have very little in the way of liquidity and either for reserves or for more immediate day-to-day operations, marketing included. So anything that they could do, that would favorably extend their marketing reach and their overall name and brand recognition would be for the good. Bringing marketplace participants into this effort, with their personal name recognition in their circles of friends and acquaintances, and as supporters and endorsers of a new business would be all but invaluable to that enterprise in helping it gain traction, and market share and more quickly than they could ever achieve on their own. So gorilla and viral marketing, as supported by the always connected, anywhere to anywhere of online social media, are obvious and increasingly essential resources – disintermediating the marketing process by eliminating third party publishing gatekeepers and directly connecting with and collaborating with the marketplace itself.

That is simple and straightforward. So I focused in Part 3 on the second scenario, which is much less so, where I offered an intentionally planned out digression into how these businesses are structured and into how they function per se. Why did I do that? My goal for this posting is to at least briefly explain that, and to complete this background foundation-building note, if for no other reason.

Let’s begin with that first, simple startup and early stage business example, as a point of comparison for what is to follow here. I just noted that they have little liquidity available, and either for reserves and for dealing with possible set-backs, or for maintaining their ongoing day-to-day activities with the expenses involved there. This is true, and essentially by definition for such enterprises and even if they do have outside investor backers as that type of funding can get burned through very quickly if it is not carefully managed and if its use is not stringently limited. But for purposes of this discussion, it is more important to note that with very small headcounts and with more direct communications throughout the organization, organizational systems are simple and direct and the effective table of organization, as actually followed operationally can be relatively flat and even entirely so for a variety of business functions and purposes.

Gorilla and viral marketing approaches can be viewed as simply following this same basic approach, and both as a necessity and as a source of opportunity, while limiting expenses in direct cash and in timing-delay forms. A larger and more established business might have greater reserves and larger and more reliably established cash flows that could be used in support of ongoing business activity. But more importantly here, they are also essentially certain to have much more complicated organizational structures with many, many more organizational layers and a much more complex and settled system of distinct supervisory and management led teams – and with all of the partitions that this creates, and barriers to smooth and friction-free communications and decision making. And I stress here that the boundaries separating these partitioned off table of organization layers, and the presence of all of those separate groups within the organization all offer opportunity for business friction with reduced and slowed down communications, and with all of the adverse consequences that this can create and certainly where a business seeks to be agile and resilient in the face of possible change. This impacts upon both internal, within-business communications, and on externally facing and connecting marketing and related communications efforts too.

One of the foundation-building observations that I made in this series and early on in it, which I repeated at the start of this installment, is that “my focus here may be marketing-oriented, but marketing per se only makes sense when considered in the larger context of the business carrying it out and the marketplace it is directed towards.” Here is where that becomes explicitly important:

• It cannot make a positive, value creating or enhancing difference to disintermediate and simplify operational processes and the communications that enable them in one area of a business (e.g. in marketing), if that more streamlined subsystem fits into and works within a larger overall business that is overly complex and bogged down with business systems friction and related inefficiency-producing barriers that undo any possible benefit so gained.

Small businesses such as startups and early stage businesses can find it a lot easier to make options and approaches such as gorilla and viral marketing work for them, because they do not attenuate and lose any potential value advantage so gained in a veritable swamp of overall inefficiency and delay, which can arise and certainly as a worst-case situation.

• And with that type of change management requiring example in mind, I note that simply adding in or attempting to add in new and exciting innovations such as gorilla and viral marketing, and without reviewing and correcting the inefficiencies and disconnects that this would have to work through, cannot help.

In a more normative context, with fewer and much less severe slow-downs and their inefficiencies, any advantage from directly connecting into the marketplace and with real participants there, can still easily be attenuated away and lost to the business – with that leaving dissatisfied members of those marketplace communities, when and as their efforts to positively communicate with the business seem to drift off into the twilight zone.

And with this offered as background material for thinking through these two business types, I return to the types of issues that I raised towards the top of this posting regarding how and why they would turn to approaches such as gorilla and viral marketing. And I pose two questions that I will at least begin to address in my next series installment, which I raise here in anticipation of what is to come:

• How best can an established business that is set in its more traditional ways, break that perhaps long-established pattern to bring in innovative new approaches such as disintermediated marketing?
• And how can such a business make this work for them, and in ways that do not simply leave any value potential created, lost in the complexities of the rest of the business?

In anticipation of this, and addressing these questions, I add in one more, as a point of orienting focus:

• Can an established and even at least somewhat sclerotic business use the introduction of new and different, such as gorilla or viral marketing as a starting point for reinvigorating and updating the business as a whole, and if so, how?

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. You can find this and related postings at Social Networking and Business 2, and also see that directory’s Page 1.

Pure research, applied research and development, and business models 7

Posted in strategy and planning by Timothy Platt on September 29, 2017

This is my 7th installment to a series in which I discuss contexts and circumstances – and business models and their execution, where it would be cost-effective and prudent for a business to actively participate in applied and even pure research, as a means of creating its own next-step future (see Business Strategy and Operations – 4, postings 664 and loosely following for Parts 1-6.)

I began to more formally and explicitly discuss what would go into developing and launching a business that offers research and its output as a source of marketable products, in Part 5 and Part 6. And by the end of Part 6 I had developed and offered a list of qualifying features and goals that such an enterprise would have to meet, and both within its own organization and for the marketplace and the potential client base that it would need to develop:

• A particular type of proposed client business and industry specialization,
• Meshing that business’ niche client focus, with demonstrated expertise and experience in the founders and leaders of such a research firm, with their having established track records for doing productive, successful research and development in their clients’ particular areas of business activity.
• Focus in this, as a founder and owner of such a research enterprise, on the industry and the businesses operating in it that you would turn to and market your business to, as your most likely customers:
• Customer businesses that explicitly need the fruits of research and development that you can offer, that they would see as necessary to themselves in order for them to be and remain as competitive as possible
• But that they would chose not to carry out in-house and on their own.

I raised the issues of direct costs, and of timing and timeframes in the context of that last point, and simply note here that a variety of possible factors can enter into a decision by a business, to outsource at least some of its product-oriented research and testing. But ultimately they all can be expressed at least to a significant degree in terms of cost-effectiveness and fit: a determination of whether or not capability to do what might even be effectively essential research fits into the core ongoing needs of the business, for its meeting its core business model objectives and as a cost-effective endeavor.

As a research provider business begins to prove itself, and as it develops a track record and reputation for success, and at least something of an established customer base, it faces at least a measure of opportunity to expand and to extend its service offering reach. Let’s consider here, at least one possible direction that this can reasonably and cost-effectively take:

• Exploring new types of applications of basic technologies that are held in place in the research business and that have contributed to its earlier success up to now: that have at least something of a track record of success in their hands and that they can successfully market themselves for having.

Let me take that out of the abstract with a specific real-world example: expert capability for developing, mixing, and producing, and testing small batches of specialty exotic materials-based alloys using advanced sintering and related technologies. These technologies make it possible to produce alloy mixes of metals with vastly different melting points and densities, among other relevant properties, that would never be possible outside of perhaps a zero gravity environment from simple melting and mixing, and at anything like a reasonable cost. But it turns out that many of the same set of technologies and skills that are called for there are also called for when making exotic metal enriched ceramics that can be used, when properly formed, as higher temperature superconducting magnets. (Exotic for more routinely considered ceramics, that is.) And many of those here-ceramics-oriented skills and technologies and essentially the same basic equipment are needed for making other specialty ceramics too.

Developing and expanding the materials handling and production capabilities from small batch exotic alloys manufactured through advanced sintering processes, to include test sample production of specialty ceramics such as potential high temperature superconductor samples would call for additional materials science expertise and at least some new equipment and physical space. But this type of business expansion might be quite cost-effective for a business that already has most of the necessary infrastructure and manufacturing resources in place for that already, from their already-current business practices, and where this next step business growth would follow a more linear expansion pattern.

Leveraging similar, relevant experience from their already ongoing work, combined with professional publication of articles on their participation in these new areas of endeavor, in peer reviewed scientific and materials engineering journals and in the news where possible would establish them for this new work too, and help establish them as research resources that a wider range of potential client businesses could turn to. And this brings me to two fundamental questions that the leadership of such a research enterprise would ask and keep asking, on an ongoing basis:

• What are we doing now and what can we be doing now, and as we move forward that would both strengthen our capabilities for the types of work that we do now and also open doors to expanding on that?
• And how can we best market ourselves as being able to offer excellence in doing this work: already ongoing and new to us, and in ways that would more effectively drive business success and growth?

I have been discussing and analyzing the issues of defining and building into an effective marketplace niche, that a new research business can come to dominate, and from the beginning of this series. And more recently and particularly in this installment to it, I have addressed the issues of growing and expanding that niche as an approach to growing and expanding the business and its competitive effectiveness as a whole. I am going to continue that discussion in a next series installment, where I will at least begin to consider the issues of business models and exit strategies, and short-term and long-term and in-between planning. And in anticipation of that, I note here that “exit strategy” does not necessarily mean the founding owners of a business selling it off and walking away from it. This term more generally encompasses transitions from startup and early stage into reliable ongoing profitability, and exiting from what might be considered a business’ infancy into a first real growth phase.

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.

Intentional management 43: elaborating on the basic model for adding people and their management into the equation 4

Posted in HR and personnel, strategy and planning by Timothy Platt on September 23, 2017

This is my 43rd installment in a series in which I discuss how management activity and responsibilities can be parsed and distributed through a business organization, so as to better meet operational and strategic goals and as a planned intentional process (see Business Strategy and Operations – 3 and its Page 4 continuation, postings 472 and loosely following for Parts 1-42.)

I have been addressing a series of issues in this series, leading up to here, first from the How perspective operationally, and then from the Who: stakeholder and participant perspective. And I repeat that list of topics points here for purposes of continuity of narrative for what I will turn to now, as offered in Part 42:

1. How is a business under analytical examination being managed now? (Note: this is a complex question because it raises issues of what it is doing in principle and as a matter of intended process and practice, and of what is actually being done and on a day-to-day basis and by whom and where in the organization and under what circumstances, and how consistently. The following questions in effect dissect out what would go into this question and what would go into answering it and from both the intended side and the actual in-practice side to that.)
2. Does this business actually follow a seemingly entirely ad hoc approach as if it had no past and as if the experience of here and now, could hold no informative value in its future either?
3. Or does it more systematically pursue at least a close approximation of the default model approach as laid out in Parts 38 and 39, with its systematically pre-planned out and followed processes and practices?
4. Or does it in some systematic manner differ from that, with non-default features brought in and included, and for at least specific areas of the business?
5. If this business does at least situationally resort to consistent non-default management approaches, where and how and when does it do so?
6. Is this resorted to in order to address specific perhaps recurring problematical situations or events, or in order to capture available value from specific perhaps recurring opportunities that the “standard” approach cannot handle in and of itself? Does this, in other words, reflect an alternative approach that might be resorted to on a needs and opportunities, functional process-defined basis?
7. Or do one or more specific areas of the business (e.g. specific departments or specific organizationally distinct sections of them, or specific satellite offices in a larger geographically dispersed enterprise) simply pursue their own course in how things are routinely done and across all functional areas and processes carried out?
8. This is only a starter list and one of the goals of any business review and analysis here would be to progressively, iteratively refine and elaborate on what is asked here, drilling down into the specifics of the particular business and away from the more generic as has been offered up to here.)

My goal for this posting is to step back from consideration of specific types of stakeholders in businesses and in their relevant outside contexts, and how they do and do not act and why. My goal here is to address, and in fact reconsider the issues that I have been discussing here from the perspective of an at least seemingly simple question, which I posed at the end of Part 42 in anticipation of this posting:

• What makes a good manager?

I have in fact been addressing this question in general, throughout this blog and as one of its central points of discussion, so my goal here is much more limited. For purposes of the here-and-now context of this series, I will focus on how a good manager identifies and understands the types of issues that I raise in my above-repeated list, and in the specific day-to-day contexts that they actually face at work. And I will focus on how that knowledge and understanding shapes and informs their decisions and actions too.

There are a variety of starting points that I could build this line of discussion from, but one in particular comes immediately and forcefully to mind for me: that of taking an ownership approach to the business that we work for, and regardless of any equity-holding or similar, fiscally grounded ownership considerations. I write here of a level and type of responsibility and of taking responsibility, and a level and type of pride in the quality of work done. And I write of commitment and follow-through, and with an ongoing goal of excellence as a basic standard to be worked towards.

For background material that more fully outlines what I mean by “ownership” and an internalized sense of it here, see:

Building a Sense of Ownership and Responsibility into Business Operations and Processes, and into Core Business Culture,
• And my seven part series: The Importance of Taking Ownership in Your Work and Your Business, as can be found at Business strategy and operations – 3 as postings 445 and following.

The issues that I raise there and that I return to here are crucially important. And they become more and more so in the context of this discussion, as a business scales up and as its senior and executive management that hold responsibility for overall strategic and operational planning, require more and more of their input on what is actually done and how it actually does and does not work, from managers and employees who work farther and farther removed from their own direct experience.

The single most important thread running through all eight of the above numbered topics points is that of adherence to or deviation from a business’ overall planning and the expectations that they would be built from and that they would further advance. Beyond that, I focused on issues such as process and process system effectiveness, but with explicit acknowledgment that ad hoc and unofficial but standardized work-arounds that achieve positive results short term, can only create risk of larger problems long-term. These short-term work-arounds lead to and in fact help create the single points of failure that can seemingly suddenly bring at least areas of a business to their knees and without warning to those who supposedly lead the organization, overall. And even when they do not cause more abrupt challenge of that type, they do create friction and inefficiency that can cumulatively limit the business as a whole and even quite significantly and certainly when that business functions in a highly competitive context.

I have been writing about communications in this thread of discussion, and over the course of much if not most of this series. I am writing about this here too, and by highlighting some crucially important points:

• Good managers supervise and lead the members of their teams. And they both supervise and manage the members of their teams as individuals, and they bring them together and coordinate their collective work in addressing and resolving tasks that are larger than any one person could handle and succeed at on their own.
• But they do not and cannot do this as if they and their team of direct supervisees were functioning in a vacuum. They have to do this in the larger context of their overall business and in the context of its overall functionally connected environment: its relevant outside context with its market and customer base, its supply chain and other business-to-business partners and providers and more included.
• Good management faces and acts in multiple directions, and not just inward towards the smaller group of employees, or of the employees and their lower level managers, who happen to fall within a given business leader’s specific management purview. And their management of their direct and indirect reports is not always of necessity the most important direction that they face in all of this, and certainly not at all times and under all circumstances.

I have been offering and outlining this approach in general terms here, and will step back to consider some of the specific in-house stakeholders that I have delved into in recent series installments, in my next installment to this series – and with a goal of taking this posting’s discussion out of the abstract with real world examples. 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. Also see HR and Personnel and HR and Personnel – 2.

On the importance of disintermediating real, 2-way communications in business organizations 4

Posted in social networking and business, strategy and planning by Timothy Platt on September 21, 2017

This is my fourth installment to a brief series on coordinating information sharing and communications needs, and information access filtering and gate keeping requirements (see Social Networking and Business 2, postings 275 and loosely following for Parts 1-3.)

I have been discussing business and organizational stakeholders, and both as they arise within a business (see Part 2) and outside of it (see Part 3.) And I concluded Part 3 of this series, stating what I would continue that narrative thread here, by specifically discussing the fifth and last outside stakeholder group that I listed in Part 3, and with at least a start to a discussion of communications in this series’ context, and:

• Within specific stakeholder groups,
• Between separate stakeholders per se,
• And more specifically, between stakeholders: internal or external to the organization, and the business and its leadership and senior management as a whole.

I begin this with the last stakeholder group in my Part 3 list: outside regulatory agencies and organizations. And I begin addressing that by offering some general thoughts on what types of organized stakeholders I am specifically referring to here, as there is a lot of diversity that has to be included here, as well as a set of critically important unifying considerations.

• The outside regulatory systems that I refer to here, can be organized, adjudicated and enforced through dedicated organizations or agencies that primarily or exclusively focus on oversight, or they can be so managed and run by more wide-ranging agencies or organizations that also have other responsibilities and areas of action too.
• These entities might be set up and mandated according to specific legal statute and with their activities defined and prescribed according to specific law. And as such, they might be governmental in nature and structure, or at least governmentally regulated.
• Or they might be more private-sector in origin and nature, as for example when leading businesses in an industry seek to step out in front of possible outside governmental oversight by preemptively setting their own standards, for product or business decision issues that carry risk of conflict with consumer or marketplace needs and desires.
• A failure on the more private sector-managed option there and the hue and cry that this can lead to, might in effect force legislative response that would push such oversight into a more officially, governmentally managed position. And that can take a great deal of the oversight and the decision making choice that participating businesses would want to keep control over, out of their hands. So even more loosely defined and enforced, industry self-regulated efforts at organized oversight can be compelling for individual businesses to follow and they can be designed and enforced with legal statute in mind.

Let me take this out of the abstract with two specific examples:

• Truth in marketing and advertizing are in large part regulated through the enforcement of consumer protection and related law and this is in large part carried out officially and in accordance with underlying relevant law, and by legally mandated agencies: the offices of attorneys general definitely included in the United States.
• In the United States, consistent supply chain systems communications between retailers, wholesalers (for replacement parts) and original manufacturers in the automotive industry, are primarily carried out under the aegis of a private sector collaborative system call Standards in Technology for Automotive Retail (STAR), that has an organizational membership that cuts across wide ranges of competing brands and their owning businesses. This organization, as a private sector venture has to operate within agreed to boundaries and restrictions that are set by legally mandated governmental agencies, and in accordance with anti-monopoly laws and the case law that has arisen from their enforcement.

This last stakeholder category, as a case in point example, brings me directly to the issues of communications and their best practices. I will at least begin discussing these more general issues in terms of this example, and then expand this narrative from there to consider stakeholder involvement and participation in general. But let’s start all of that with the fundamentals:

• Communications only work when there are messages that sender and recipient would see as holding sufficient importance so as to justify the effort to organize and share them.
• A sufficient channel has to be available for this, with both adequate accessibility and bandwidth, and with adequate security as required too.
• And potential participants have to be able to use this resource at times that would work for them and with sufficient timeliness for the messages that they would have to share. Messages that can only arrive too late to matter, cannot matter or hold any real value and for anyone involved.
• And with the second, outside regulatory half of my STAR example in mind, communications have to be framed in accordance with the requirements of all involved and potentially involved stakeholders, which in this case includes their being framed in accordance with exceptions to anti-monopoly law that are carved out to allow for and support, permitted exception communications.
• In-house information management security systems can and do create their own filters and restrictions and their own systems for exception handling and the creation of special-case communications allowance too. And this has to be allowed for and specifically planned for too.

I am going to continue this discussion in a next series installment where I will consider communications within businesses, and both along and across the table of organization. I will also delve into the issues of publically traded companies communicating with shareholders, where traditional annual reports and legal document formatted stockholder reports and updates are only one approach that can be pursued – and particularly in an increasingly ubiquitous interactive online, social media driven context. Too many businesses still communicate at their stockholders as if they still lived in a pre-internet world and in too many ways and with too many limiting presumptions. That can be improved upon and it has to be for 21st century businesses.

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 also see Social Networking and Business 2 and that directory’s Page 1 for related material.

Business planning from the back of a napkin to a formal and detailed presentation 18

Posted in strategy and planning by Timothy Platt on September 19, 2017

This is my 18th posting to a series on tactical and strategic planning under real world constraints, and executing in the face of real world challenges that are caused by business systems friction and the systems turbulence that it creates (see Business Strategy and Operations – 3 and its Page 4 continuation, postings 578 and loosely following for Parts 1-17.)

I have been discussing a set of topics points in recent installments to this series, which I repeat here for purposes of continuity of narrative:

1. Different functionally focused stakeholders might reach different conclusions as to which processes and subsystems of them are core or peripheral to a business, and as to which might be secondary-peripheral of them – and if so of what type (e.g. necessary but outsourceable, or no longer needed and dispensable.) And it is important to both clarify and discuss those differences, and to reach a working consensus that all key stakeholders can come to at least tacit agreement upon, and certainly if a business is to enter into and carry through upon the right transitions for its own needs, and in the right way and with the right timing.
2. Then after that, and in the context of distinguishing between core and peripheral processes, I said that I would turn to consider areas and aspects of the business that can be linearly scaled up, and areas that represent true nonlinearities – places where simply scaling up according to the pattern in place would create inefficiencies.
3. And I added that I would discuss all of this in terms of crucial information availability and communications, and in terms of two types of case study examples: a retail business, and a software development business.

And after discussing the issues raised there in general terms, I turned in Part 17 to consider them from the perspective of the retail business case study example that I made note of in Point 3, above: Alpha Hardware as it expanded out from their original single storefront to include two specialty storefronts: Alpha Hardware and Alpha Home Goods.

My goal for this installment is to at least begin a discussion of how the issues of the above-repeated list, would play out in a second business context, that differs from the already discussed retail store case study in some significant ways. I offered to expand this discussion through consideration of a software development business, and I do so here, with a brief and selective analysis of a business that I will referred to in this series as the e-Maverick Group.

I have at least begun this case study analysis in Part 17, when I introduced that business with the following orienting comments:

• The e-Maverick Group is an e-commerce software developer and provider that seeks to offer cutting edge and next generation software solutions to their business clients. They see themselves as pioneer developers that offer the best of New to a largely pioneer and early adaptor business client audience.
• To put this business in comparative context with what you would find and expect in a business such as Alpha Hardware: while new products and even new types of products do arise and appear on the shelves of hardware stores and home goods stores too, a great deal of what is offered there is fairly standard and stable in function and in basic form. Change that appears on their shelves tends to be more cosmetic in nature – even if that can be very important for their customers and for their overall business success. That situation is not going to hold true for a business like the e-Maverick Group, where even seemingly consistent product types can fundamentally change in both what they offer to their customers in functionality and in how they do so. And this more fundamental change can only be expected to take place at a steady, rapid pace and certainly for any business that seeks to be a trend setter the way the e-Maverick Group does.

The e-Maverick Group is change-driven and even disruptively novel change-driven, and in ways that a business like Alpha Hardware would never be. And that has implications when considering the types of issues under discussion here. And I add with that in mind that fundamental, disruptively novel change in what a business offers, as noted in the above two bullet points, often means at least a need for equally fundamentally New in how they do that too at a business operations level.

Let’s start this analysis with a deeper and more detailed consideration of what these two businesses bring to market, as considered from the perspective of the above three numbered points. And I will begin this narrative with a more detailed consideration of the marketable offerings themselves, and then go on from there to consider business processes and decisions that would enter into providing them to a marketplace, and profitably so.

• I just noted that most of the products that a business like Alpha would offer (through its Hardware and its Home Goods storefronts), would primarily change cosmetically over time. Some new and even disruptively new product types and options would enter into their inventories over time but most of what they would offer would be relatively standardized and even long term. Novelty there, and disruptive novelty in particular in what they would offer, might matter for this type of business as it sought to stay current and competitive for its basic overall market audience. But the more important point here is that the range of products: the number of distinct stock keeping units (SKUs) carried and sold would be large and for the most part predictably stable and certainly when known seasonal and other trend patterns are taken into account.
• So the presence of more poorly performing items: products that do not sell very well and that primarily just take up shelf space, would be buffered for the most part by better performing product offerings that are also on those shelves. And the slow or seeming no-sellers would be weeded out and replaced with newer SKUs, and little immediate fiscal or other risk would have been faced from that. This type of store does not design or manufacture the items that it sells, so the only costs to the business faced from bringing them in and trying to sell them would be the more nominal ones associated with acquiring them wholesale, plus any losses accrued from their having in effect wasted what could be more profitable space in the business if they fail to sell. Stability and reliability in all of this would be central to the basic business model in place and would be goals in its basic strategy and for its overall operational systems.
• When you consider a business like the e-Maverick Group, a great deal of what I just noted in the two preceding bullet points, fails to hold true for it. This business offers a much smaller inventory of product types at any one time, so a great deal more of its success it tied up in the marketplace success of a much smaller number of products. And in fact the overall success of the business might very well depend essentially entirely on the success of its newest offerings, with older products and versions of them that are also still produced and sold, contributing to their bottom line but not fundamentally shaping it. And a business like the e-Maverick Group does make essentially the entire investment that goes into making this possible; it accepts essentially the entire risk associated with developing and producing and testing and refining their products, until they are reliable enough and desirable enough to a target market audience for them to succeed – at least hopefully. The sudden and unexpected release and sale of a disruptively new software offering by a competitor, can completely reshape a marketplace and in ways that make its buying consumers see next generation versions of what had gone before, seem last generation and outmoded, and even if they are significantly updated versions of that. And this type of change can and does take place literally overnight when it does.
• This all definitely holds true for businesses like the e-Maverick Group that live or die depending on how appealingly cutting edge they can be and how effectively they stay that way. I wrote of stability when writing about the Alpha stores in this narrative, and about how that is a goal that their business model and their strategy and operational systems would actively strive for. The e-Maverick Group would seek to find ways to survive and even thrive at what might at times seem to be the center of a storm of ongoing change that is taking place both all around them and within them.
• And the considerations that I have been making note of here would inform these business models for both of these business types, and their overall strategies and operations and their views and understandings of change: linear and predictable, and disruptively transitional in nature. And they would shape the dynamics of any agreement or disagreement among involved stakeholders as to where their business is now and where it should be going, and how.

I am going to continue this discussion in a next series installment, where I will further develop the points raised in the last of those bullet points. 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.

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