Admit it: you’ve been there. You try and think about another new aspect of your business; whether it’s a product or service extension, a new territory, competitor, change in compliance or a new direct report or team. Your brain feels like you’re wearing sunglasses at night. It’s hard to see, and even harder to do. You start to rock slightly as you try again to work out how to move forward, and then you realise you’re there. You’ve reached your maximum point of overwhelm (MPOO).
Ok, so I made up the term and acronym because of the school yard connotations, but it’s illustrative. Getting so overwhelmed by the apparent complexity of your business is exactly where you shouldn’t be. You are the boss, and you absolutely cannot sink into the morass.
It’s never going to start well when you are exhorted to find your unique sales proposition (USP)…. really? Unique? With massively varying estimates of between 150-250 million businesses in the world at any point in time, you expect to be unique? For me, this immediately sets the bar too high by stressing your brain into trying to be too complex for what’s actually required.
And what’s actually required? Strategy is about serving an unmet need or want. The focus is therefore on the ‘unmet’. If your solution happens to be unique, great. But recognise that increasingly as consumers we crave the simple vs. the complex as our apps, digital tools and interfaces become ever-more complex in false competitive feature-creep arms races.
Do your gross profit analysis on each of your products/services.
Do you find the 80:20 Pareto principle of the vital few (20%) of your products/services delivering 80% of your gross profit contribution to your overheads? When you look at all the other things your business does you may get the dawning realisation that you’re being busy fools. Here’s a ‘fun’ but sometimes depressing exercise: take all the costs of delivering your most profitable lines of business and put them on one side. Now take the rest of your costs, wave your magic wand and imagine that they – and the disproportionately low revenues they drive – disappear. Quickly recalculate your new P&L. Most of the time I do this with clients, I see tears form as the realisation dawns; we often do too many things in response to competitor or existing customer demands, rather than asking whether there is a real, significant unmet need or want in the market.
You must set your business limits. They don’t set themselves.
You are the one who has to lead by example in saying ‘no’. Bloomberg is a good example: worth c.$50bn depending on market conditions, it provides financial market information. Wikipedia lists 13 products/services, but – with the exception of its investment arm – all do the same thing: provide information to enable better investment decisions. Dig even deeper and you find that over 85% of its revenue (and more than that in profit) comes from its financial information terminal business, which was the original product produced to address unmet needs in the market (www.wallstreetandtech.com).
Mike Bloomberg owns 88% of the business and could easily dictate expansion into other areas, but he doesn’t. Everything is about providing information to enable better investment decisions. When he launched the business the market was already crowded with terminals provided by Reuters. His ‘unique’ proposition? Provide a second screen which calculated ratios from the financial information on the first screen because he observed the traders using calculators, pens and paper. Also, recognising the power of these time poor/cash rich traders to their financial organisation, he targeted them directly rather than going via procurement and threw in some early web services for life concierge/gift delivery services. I’ve massively oversimplified to make the point (see, I practice what I preach…), but what they do isn’t rocket science. He spotted an unmet need and recognised and exploited a simple reality in the dynamic between traders and their employers.
You must focus on the essential.
As well as stopping your business’ attention deficit disorder, you have to lead from a personal perspective. As well as limiting your bigger projects to reduce the overwhelm, personally focus on the essential few and eliminate the rest. Whether meetings, external commitments (panels/chairing/charities etc.) or even line reports, if they are not in the vital/essential category then you are wasting time on the less valuable. Because your time and attention as a leader are your most valuable resources, you have to become a focus Scrooge.
But recognise when simple is dumb.
This article isn’t permission to ignore necessary complexity or sophistication. There are plenty of things in business (and life) that can’t be simplified, and indeed the future of unmet wants (if not needs) is increasingly being mapped by crunching more data and better predictive analytics. So don’t try and be binary about something which requires your fuzzy and dissonant thinking – the key is to recognise what is required.
I reorientate myself in my businesses, and with my clients, by recognising our primary human settings. I discussed the primary need/want above. I believe that if you recognise that related to this, most of our behaviour can be categorised as being either ‘from something’ we don’t want or ‘to something’ we do want, you’ve pretty much got our blue print.
Actually, I just lied. I really imagine I’m the hero in an action adventure, taking control of the world-threatening scenario with a set of clear directions. No one really wants the three options or the five possible scenarios; so get all Angelina Jolie or Bruce Willis and lead.
Si Conroy specialises in helping business owners remove their blockers to profitable business growth; be they strategy, marketing & sales, people, finance or systems/process. Trained at PwC and owner of Scarlet Monday
(www.ScarletMonday.com) and www.ConstantMentor.com, Si practices what he preaches across a number of businesses in which he has invested.