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Ideas on Designing Your Business, Vision, Product and Market Positioning in Early Stage Companies:
"We shouldn't look back in sadness, nor forward in trepidation, but rather look around us in awareness."
No problem can withstand the assault of sustained thinking. Voltaire
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What is a Vision?
There is a lot of talk about maintaining a vision, especially as part of a CEO's job. In my opinion, vision is one of those terms that is both greatly overused and largely misunderstood. Many people consider vision to be an all encompassing view of the product. Others will expand it�s meaning to include the entire market and still others believe the term encompasses far more.
Having been personally responsible for a corporation�s vision for many years, I believe it covers more than what most people think. So, what follows is my definition of vision, and I do not understate the case when I say that, with few exceptions, the lack of a strong vision puts you at a distinct competitive disadvantage.
To begin with, I believe a vision must encompass everything about the business. This includes everything from things as high level and broad as the organizational chart right down to details like basic product functionality. It also includes the strategic and tactical levels of every discipline required to run the business. This must include these two levels for finance, sales, marketing, operations, and product development. Each variable must be imagined over time as a series, because many will rapidly change. Does this sound like a mind-blowing exercise? Yes it does. Thankfully, though, because our brains are wired to think visually, and are the most powerful computers on earth, this task is well within the most people's intellectual capacity. The biggest issue is most people don't have all the needed information or the experience to understand and design these business models. This is real work; not magic, luck, or the flash of insight that may have been the genesis of a product�s unique abilities. As Thomas Edison says "Genius is one percent inspiration and ninety nine percent perspiration." The exercise of writing a business plan generally fills in much of the vision and is worth the effort even if you throw the plan in the trash when you are done. It can allow the merger of different skills to happen to evolve the vision but is never the same as having the experience in one head, which forces greater discipline and integration.
Why, you ask, must a vision be so elaborate? Because, the purpose of a vision is to have something complete, and against which you can hold up all major business decisions. It is almost a philosophy for the company to live by. This helps ensure consistency across departmental goals and helps eliminate other major factors that can split a business into fractional pieces; such as two departments going after different objectives, and effectively dividing your resources across these objectives, or even markets.
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Until one is committed, there is hesitancy, the chance to draw back, always ineffectiveness. Concerning all acts of initiative and creation, there is one elementary truth the ignorance of which kills countless ideas and splendid plans: that the moment one definitely commits oneself, then providence moves too. All sorts of things occur to help one that would never otherwise have occurred. A whole stream of events issues from the decision, raising in one's favor all manner of unforeseen incidents, meetings and material assistance which no man could have dreamed would have come his way. Whatever you can do or dream you can, begin it. Boldness has genius, power and magic in it. Begin it now. GOETHE
Why New Products Should Never Shoot to Solve 100% of Any Problem
Ever notice how that last 10% of most any job takes half the time? This is a simple fact of life in most tasks because the more detail you try to finish the further you get up that exponential curve to perfection. Even painting your house perfectly is an unachievable and ridiculously expensive goal. In fact an excellent job will cost twice as much as a very good job, and that will cost twice as much as a "good" job. That means an excellent job can cost about eight times more than a good job - so you need to decide where you want to be on that quality curve which is literally exponential. How close will you want to look at the paint job to feel good about it? How much will customers want to pay?
Unlike large companies, where thousands of people can be impacted immediately by a product, not to mention the brand, a startup with a new product demands some risk taking, faster solutions and essentially a far less complete solution that is lots cheaper than any larger company would expect to invest. And I don't mean 50% of what a large company might invest I mean 10% or 20% for the same or better product for most customers!
Lets face it, if Microsoft waited until Windows really worked they would not have released version 1.1 in 1989, they would have released Windows 95 SIX YEARS later when it was ALMOST stable, or even Windows 98 NINE years later when it really was stable and a good product.
Every Product Must Ship With Some Problems
The fact is no company can afford perfection and every product is shipped with some problems and/or missing features. Heresy - No Just realistic. This is not to say that product quality needs to suffer, I am not talking about quality. I am talking about solutions that cover 50%, 80% and 90% of the problem instead of 100%. This is not only acceptable, but very desirable in most cases. The fact is that customers will generally only use 20% to 50% of a fully mature product and you need to figure out what that is and deliver just that in a first release. How you do this is more art than science, but it involves lots of customer research and and a broad scope and understanding of the customers' day-to-day activities and priorities.
Too often the person doing Product Management either does not understand the technology well enough to understand it limits, and help in design, or they do not understand the customer and market well enough to design the product. People that can understand both market and the technology, and translate between the two are the most valuable people in your organization. They can make or break the company by delivering the right product to the right market. All too often this responsibility is broadly spread across many people in an organization and no one takes full responsibility. This prevents quick iteration to the right product every time, as it is design by committee and never works well or fast. Someone must "own" the product vision and have a very high understanding of the market and technology. However, they must also integrate all feedback and have the business experience to prioritize taking into account all costs, not just development. This can cut product development costs by 50% to 80% all by itself by developing the right product (or subset of it) first time out. Believe me this can save millions in other costs while an early stage company is losing money every month.
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Bob Norton is CEO of C-Level Enterprises which provides C-Level Help, coaching and interim CEO services to companies up to $1 billion in revenue. He has been a full-time CEO since 1989 and now works with companies to refine business models, improve company visions, improve performance and design businesses for long term strategic advantage. He can be reached at Bob@CLevelEnterprises.com.