Experiences
and Observations from the Business Front Lines in the post Dot-Com
World
Despite the current economic winter, the entrepreneur spirit is
alive and well. Emerging companies are vigorously working to launch
or reinvent themselves and deploy strategies that will grow their
current marketshare and revenue. For every company that has deciphered
the magic code dozens still struggle with the challenge. To assist
you in "kickstarting" your business, we've identified
seven critical factors that successful businesses, both large and
small, have embraced. They will not only help ensure your business'
survival but will also accelerate your competitive advantage.
1) Be realistic about your business objectives
Passionate leaders command most startups. They have an aura of
electricity and their enthusiasm is contagious. Unfortunately, many
of these same leaders operate under the myth that the product will
sell itself, and so they set unachievable goals. This is one of
the most common mis-steps that end up crippling a business.
Setting goals that are overly optimistic and vague, such as, "to
be the company to grow to $1B faster than any other business,"
lack substance and meaning. Others such as "to become the defacto
standard for web-based self-service in 12 months" include a
time horizon, but fail to indicate how, what, or with whom success
will be achieved.
Every company needs a clear vision and a mission statement, but
specifying ambitious goals without support will lead to agitation
in the board room, frustration for the sales team, and a detrimental
cash burn rate. Those companies that were the most successful shared
a common trait of setting clear business goals that included credible
and complete information for their staff to execute them. As the
economic conditions changed, they were also quick to revise their
short- and long-term business goals to match the industry. Finally,
each company went to great lengths to enlist the involvement of
their employees to ensure not only the development and articulation
of the business objectives and measures, but their adoption throughout
the organization.
Success Factor #1: Identify stretch goals with reasonable milestones
and timelines that can be matched with current investment and spending
plans.
2) Understand your unique value proposition
Successful companies know that it takes more than technical leadership
to create a sustainable business - there must be value for the customer
that exceeds the value currently being offered by other solutions.
A value proposition starts with careful focus on a single target.
The temptation to try to be all things to all people leads to the
overextension of resources and the inability to execute. Next, a
value proposition needs to clarify the specific problem you are
solving and quickly explain the compelling reason why your solution
is best.
Value propositions are not created in a vacuum or the boardroom.
We discovered that several startups frequently solicited input from
prospective customers early in the product development phase, collecting
feedback regarding the problem, the product, the sales process,
and the anticipated market reaction. This information helped them
hone their business plan and accelerated a return on their marketing
and sales investment.
Success Factor #2: Based on customer and/or prospect feedback,
frame a value proposition that identifies the target customer and
what you do for them better than anybody else.
3) Take a hard look at your competition
It is surprising to find that many startups and emerging companies
are convinced they have no competition. Some entrepreneurs are focused
so intently on their product that they fail to recognize evolving
market trends or anticipate competitive advancements in markets
that may overshadow their own value proposition. With product lifecycles
shortening, it is critical that companies accurately judge the competitive
landscape in order to take full advantage of their market window.
Many of the startups we've worked with considered two dimensions
of competition: First, How are users addressing this need today
without your product or service? In most cases, users have adopted
some solution or service to address the problem you solve. These
startups spent time understanding alternatives being used today
before they launched their product. Second, What similar products
or technologies are being employed today? One startup we worked
with researched 30 competitors and distilled them into three categories.
From this grid they were able to clarify their points of differentiation.
Success Factor #3: Research the competitive landscape and categorize
your competitors, noting their strengths and weaknesses. Then compare
your company against this landscape. This exercise helps identify
points of differentiation that can be communicated in sales and
marketing programs.
Part II of this Article: Critical
Success Factors 4-7
Mike Gospe (mikeg@kickstartall.com)
is one of the founding members of the KickStart Alliance. This paper
reflects his recent experiences and those of his colleagues: Mary
Gospe, Janet Gregory, Amy Matthews, and Mary Sullivan.
The KickStart Alliance (www.kickstartall.com)
is a team of senior marketing and sales leaders who assist startups
and emerging companies develop and execute a variety of marketing
and sales goals and objectives.
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