I’ve spent a significant amount of time in both small business and big business environments. And the over riding conclusion I’ve come to is this:
Big Business is about the small picture.
Small Business is about the big picture.
While it seems unlikely, this irony is true for most of the people involved in either scenario. Big business due to their success and size split the tasks up into tiny little pieces. “Mary is responsible for new product development of our fat free, individually wrapped, cheese slices for the South West region”. The people become cogs in a machine that is so big the world becomes obscured. While in startups and small business we are responsible for, well everything from customer complaints, to invoicing, to media interviews.
So before we transition from big business into a startup, it pays to pay attention to the big picture because all too often when we ‘grow up’ working for big companies we lose sight of the real world we operate in.
Today I was having a chat with an aspiring web entrepreneur. She contacted me for some advice via skype. I asked her a question about her target audience, suggesting she focus on the top end of town and I thought was worth sharing here:
Antony: I thought it’s best to focus on all small & medium companies rather than big giants
Steve: The size of the company is totally irrelevant. What IS relevant – is why your business solves their problems….
I don’t think you can delineate between big or small business being harder to sell to. I’ve had just as many challenges with each…
Small biz can be tighter with their funds….
Big biz can be locked into deals….
and vice versa…. it’s in our mind….
Steve: What matters is the value your business creates…. when you create value that matters – then the sell gets easier – regardless of the target…
Prufrock coffee who created the worlds first disloyalty card.
The card to encourages their clients to sample the wares of quality coffee shops around their local region in London. Which is completely counter intuitive to sound business practice.
How does it work?
If a disloyalty member tries all 8 coffees on the above card , it will earn you a free coffee at your next visit to Prufrock Coffee. The interesting part is that it was conceived to keep ‘coffee customers’ out of the four walls of the ever encroaching Starbucks behemoth. The disloyalty card created a community of coffee lovers that could compete the ‘way of an artisan’. Something Starbucks could never do. It might just help keep them out. In this instance the community matters more than the trader. This is the new collaborative world we are in transition towards. A community who vest their interests in each other.
What can your startup do to flip the rules and do what a bigger competitor never could?
So how do we leverage a human revolution from a commercial perspective? It’s a big question. And even though the web has gone a long way in deconstructing power bases, business and human evolution are still inextricably linked. So I thought I’d post a few things that matter in a digital world so all players (people and commerce) can create value for each other simultaneously.
Rules of engagement
- Authenticity pays. Be real, don’t pretend to be something, or someone your not. Brand respect comes from understanding the rules and respecting the on line world as the real world and vice versa.
- Speak with a human voice. We don’t listen to Corpi-speak. We listen to voices from people. We ten must personify our brands.
- Engage the crowd. They own our brands. You want proof. When they stop feeding our brand (buying) it dies. We must pay the respect the real brand owners deserve. It’s always been this way, but we didn’t know…. because we couldn’t hear their voices. Now they they have a voice, we must act on it. We have to let our people hijack our brands. User Generated Content and Crowd Sourcing is where it’s at.
- Compound effort. Benefits take longer to garner in the new world. It’s not like the old days of a large media campaign with instant results. We are moving from a low human capital, high financial capital environ, to a large human capital, low financial capital world.
- Learn on the job – it can’t be strategized. It’s too unorganized and changeable… the web is humanity in digital form. Then they only way to play is to embrace the chaos and be part of the conversation. It can’t be justified to a board room, but the companies and brands who choose not to play will be wondering what happened a few short years from now.
Most of all, have fun doing it.
- Project management is the key skill (Outsource weaknesses, be blissfully unaware how to do technical things, manage the value chain.)
- Think micro (Start small, no tiny. think hyper-local, and expand out from there)
- Compound effort (Our labour compounds over time like interest and investments do, social media takes compound effort)
- Speed is better than perfection (perfection is the enemy of success, launch review and iterate constantly)
- Manage for cash flow not profit (Money in and money out are the only 2 financials that matter, we can’t go broke when cash flow positive)
- We’ve got to sell (Selling is a core skill, we have to sell not just to customers but to everyone in our business world, employees & suppliers too, have a sales guru in your team)
- Start now (The right is never going to come, stop waiting for it)
I was fortunate enough to feature in a story on the ABC 7.30 report this week. The topic was on virtual offices and digital offshoring. My business rentoid got a nice little plug which is a bonus on a non-commercial channel. The opportunity arose from this newspaper article I was in on the topic in the Sydney Morning Herald. Which goes to show media exposure also has a compounding effect for your startup as well.
Although the story and offshoring in general has it’s detractors (unions love the status quo, unless it involves profit increases they want a share in). I’m very proud of the fact that I’ve worked with talented people in developing markets.
- My team get paid more than they’d get locally.
- I’ve helped team members get more work, and mentored them in building their own businesses.
- I like investing in developing markets because improves living standards.
It’s our job as entrepreneurs to create positive situations with tech innovations, and there’s no doubt in my mind having an overseas team does this, while building a business with beneficiaries locally (employees, revenue, community) as well.
I was inspired by a recent article from the Australian Anthill about making our business appear bigger than we are. But in the age of authenticity, do we really want that? Sure, appearing big can be a good thing depending on our audience. Certainly, the key point in the article to me was ‘How to appear professional’. But why should professional be inextricably associated with big? Maybe the strategy should be to appear as small as possible. The current market place is not short of large corporates who are starting to understand the importance of personal service again. An example that comes to mind is the Bank of Queensland moving to a franchised branch model – where local ownership is of strategic importance to customers. Especially in such a tarnished industry as banking.
So why would we want to appear smaller than we are? Here’s a couple of thought starters:
Service – it is implicit that service is better when dealing directly with a small group of people rather than a faceless corporation
Trust – Smaller companies are way more dependent on you as a customer. You matter more, so you can trust the fact that they will do all they can to keep you.
Underdog - People love to support the up and comer. The person having a real go. Being small should be embraced and leveraged. Often this might be the only reason people do business with you.
So in the spirit of small = good, here’s the startup blog top 10 list of how to act small. Regardless of our actual revenue:
- Have personal contact details of team members on your website. Email, Skype cell phone.
- Remove pointless gatekeepers from your office who insulate hierarchy members from real customers
- Use real language in all written forms of communication. Use a human voice not corporate PR brochure parlance.
- Be honest when you stuff up. Admit it openly and quickly. Don’t make decisions based on repercussions, but on what’s right.
- Write terms and conditions (if you must have them) in a language anyone could understand
- Never call your audience your target. Business is is not skeet shooting, it is about delighting. You are performing for an audience, who can get up and leave at any time…. or even throw rotten tomatoes.
- Give responsibility to individuals not committees. Give them decision authority. It’ll get done quicker and better.
- Don’t gag your people. Allow anyone to comment on the company and what’s happening. It’ll be the best research you can ever do to find out what’s really going on in your company. No ships will be sunk.
- Have a policy of common sense. Not written manuals no employee will ever read.
- Say, “Yes we are only a small company…. and here’s why we are better…”
I was asked to answer a few questions at a talk I gave last week at the Nationwide Networking Event. It was aimed at Small businesses with the topic about new media and the advantages of being small. I thought it was a nice snippet of ideas worth sharing here.
Q: What type of changes can we expect from media in 2010 and how do we need to prepare for it as business professionals?
A: Media will fragment further, it’s increasingly like fashion with new ideas appearing daily. The art of value, like with fashion is by going with the classics and choosing the right style for the brand you want to build. Match your environment, by being involved in the right channels.
Q: Where do you see the role of the blog in the future?
A: Increasingly important. Blogs are a trusted source, because bloggers become, or are an expert on their topic of choice. This is because all good blogs are topic specific. And people want to deal with experts.
Q: What can we expect from the evolution of twitter and our capacity to use it as a marketing medium?
A: If we use it as a marketing medium we’ve already lost. It’s a conversation…. Conversation can turn into business, but it is primarily a conversation. First we need to be a resource. A resource to others, from which we can build trust and valued relationships. These may eventually lead a business relationship.
Q: What trends are coming from America that we need to be aware of?
A: Trends are global now. We don’t have to look overseas to see it. Things arrive simultaneously. It’s not like it was 20 years ago where our friends return from sojourns overseas to tell us all about the cool things they saw, and we have to wait for them to appear in our market a few years later. Now it’s on our desktop the day it happens. This is been further facilitated by web tools such as Springwise, Twitter and Youtube.
Q: How do we (small business people) benefit from the changes in the media landscape?
A: Barriers to entry have been removed so anyone can play. But it requires a long term consistent effort. New media requires a low financial investment, and large human capital input. Where as old media requires a large financial investment with little human effort. At least now we have to choice. In addition large companies have been (so far) pretty bad at using new media. It creates an advantage for us.
Q: How can we better utilize technology tor reduce our costs and increase our profits?
A: Shift from being doers, to becoming project managers. Outsource where ever possible. It’s easier now with all the tools we have at our disposal like elance and skype. Why do we even need an office? Is it because we need to, or because we don’t trust the people we work with?
Q: Your blog has 50,000 readers a month, how did you do that?
Q: What is the meaning of micro brand building and how would it be relevant to soloprenuers?
A: Build your personal brand first. That’s the first part of micro branding, becoming known for something. Having a skill you can share with others. Then eventually cross fertilize to your business brand.
Q: What are the simplest things we can do to build a micro brand?
A: Have a tight focus area of interest. Share our lessons honestly and openly. Frequency of output.
Q: How do we protect our brands?
A: Not with IP and legal stuff…. Most of that is a simple waste of money. We protect it with customers, innovation and reliability.
Q: What one piece of advice would you give to those of us that need clients and need them quickly?
A: Cold call. Not on the phone, but turn up and talk.
Q: What books have influenced you?
Q: What marketers / speakers have influenced you?
A: Steven Wright (comedian) he taught me how to flip my perspective for alternative solutions.
In nature, with every second something lives for, it’s probability of continued life increases exponentially.
The lessons for startups is simple, do the stuff that keeps you alive longest. And the most important thing we can do for our startup is keep our costs low. Low cost operations gives us the advantage of time. And time is the most important asset when it comes to working out our business model. Not capital, not technology, not employees, not research. Just time.