Modern Business Principles
1. You are in the software business
2. Embrace continuous change
3. Manage via outcomes – Focus on changes to behaviors and business results
4. Reduce risk through rapid experimentation
5. Strong opinions, loosely held. (Passionately dispassionate)
Product Positioning Strategies
Differentiator – competes through good designs, high awareness, and easy accessibility.
Cost Leader – competes on price by reducing costs and passing the savings to customers.
Broad Player – competes in all parts of the market.
Niche Player – competes in selected parts of the market.
16 Mistakes Entrepreneurs Do Not Have To Make
- Miscalculate size of market, timing and ease of entry, as well as potential market share.
- Underestimate financial requirements and timing. Run out of money.
- Over-project sales volume and timing. Fall short of sales projections.
- Cost projections too low. Costs are higher than budgeted.
- Hire too many people and overspend on offices and facilities. Overhead too high.
- Lack contingency plan for shortfall in expectations.
- Have too many unnecessary partners.
- Hire for convenience rather than skill requirements.
- Lack continuous overview of company, manage in parts.
- Accept “not possible” too easily rather than “find a way.”
- Too much focus on sales volume and size of company rather than profit.
- Seek confirmation of one’s actions rather than seeking the truth.
- Lack simplicity— create too complicated business that requires too much talent to execute and manage.
- Lack clarity of ones long-term aim and business purpose.
- Lack of focus and identity. Too many directions at once.
- Lack exit plan and strategy.
Questions to Validate Research
Here are 7 questions to ask when someone says ‘research shows’.
- Who did the research? Was it a genuine academic institution, a company or just someone with a grand sounding title?
- What’s on their agenda? Do they have a vested interest in the results one way or another?
- Where was it published first? Was it through a reputable science journal and peer reviewed (better scientific practice) or was it through the mass media?
- When was it published and when else? ie have people been able to replicate the findings?
- How was the science done? Is there statistical analysis, what’s the sample size, was it a double blind trial, what’s the language that describes the results?
- What’s the result saying? Is it a magic wand that’s going to solve all your problems (suspect) or is it another piece in the puzzle (more realistic)?
- Is this research relevant to what I do and can I or should I apply it? The fact that something stimulates your ‘anterior cingulate cortex’ may sound impressive but is it relevant to what you’re trying to do?
Storytelling
Haidt argues that the human brain is really made up of two parts:
- The rational, conscious, deliberative side—the Rider.
- The other is the emotional, visceral, automatic side—the Elephant.
Because he’s holding the reins, the Rider thinks he’s in control. This is the rational side of all of us. We’re rational animals, wired to make rational decisions based on logic, data, and credible evidence.
But then, there’s the Elephant- the emotional side. The part of us that acts on feelings and gut instinct, sometimes completely subconsciously.
One of the very best and easiest ways to evoke emotion is through great stories. If research is the language of the rider, then stories are the language of the elephant. And it’s when we have both—along with a clear plan of action—that we see powerful results!
In their book Switch, the Heath brothers put it all together:
To truly drive behavior change we need to do three things:
- Direct the Rider———————————-Disruptive Insights
- Motivate the Elephant————————–Powerful Stories
- Shape the Path———————————–Clear action plans
To unlock business partner’s potential, we have to use the three things on the right. All three here are crucial. While many organizations cover the first and third with clear standards for their teams, it’s the middle one, the powerful stories, that often gets overlooked.