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10 Questions To Achieve The Clarity You Need For Your Business

In the business context, there are 10 questions that, when answered with clarity, enable a business of any size to get to grips with its business, and its probability of success.

Janet Featherstone

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Clarity is the alchemy that divides businesses which fail from those which enjoy longevity. When businesses lose direction, or have none to begin with, it’s a sharp and relatively quick downwards spiral towards closure or acquisition.

A lack of clarity is something that can plague the smallest to the largest organisation. We are operating in a volatile, uncertain, complex, ambiguous (VUCA) world, and in facing these conditions, and dealing with our own internal turmoil, we can find ourselves lost – or at a loss – at times.

1. What business are you in?

This may seem to be the most mundane question to begin with, but in contrast to its simplicity, it sets the strategic direction for organisations.

Consider McDonalds, for example. Asked what business McDonalds is in, we would probably answer fast food. Ask McDonalds that question and the answer you’ll get is property.

Knowing this fact helps us understand that McDonalds will only purchase prime property, in high-traffic areas. Unless this raison de etre changes, you will not find McDonalds locating in Petrol Stations.

Understanding the very core of the business you operate gives a massive injection to knowing the strategic direction of the organisation.

Related: Create Clarity for Your Team

2. Is the market there?

Whilst the answer to question 1 is an internal, strategic question, question 2 requires engagement with sources outside your organisation or circle of friends.

It is imperative that you quantify the size of the market that you are aiming for, and understand as much about the market dynamic as possible, prior to market entry.

You have to consider the size of the market, how competitive the space is, and whether power is held asymmetrically by any of the players. Think long and hard about how you are going to win your piece of the pie, particularly if you are low on resources versus your competitors.

3. What problem do you solve?

Answering this question helps you understand the need your business addresses. Position your answer in the context of solving a problem that a consumer or business has.

Doing so shifts your focus from features to benefits. For example, if you are a motor manufacturer, saying that you get people from A to B might be true. However, if the only thing your car does is get you from A to B, then your competitor will also be bicycles.

There is far more to this picture than what may be immediately obvious, so it’s important to invest time really thinking through your answer to this question.

4. Who do you serve?

This question is intertwined with 3 above, but moves the question to a different level. This focus requires gaining clarity about the consumer who will buy your product or service. Or, if you’re in the B2B sector, which is the organisation your business would love to serve?

It is important to define this to the point that you can describe your client in terms of an actual person, or specific organisation, and have identified the traits that make them your ideal client. This client–centric approach allows you to gear your business and your marketing around your client’s specific needs and expectations.

Related: 10 Things I Wish I’d Known When I Started

5. How do you make money?

making-money

  • How does your business intend to create income?
  • Are you producing a product with a certain margin on at the time of sale? Are you offering a service of some kind?
  • What pricing strategy are you going to pursue?
  • What is the pricing currently on offer by your competitors
  • How does your pricing compare versus the value you are – or intend to be – offering?

Pricing your offering at the correct point is one of the most crucial decisions you’ll make as an entrepreneur. Price too low and you leave too much on the table. Price too high and your demand dives. Pricing in the middle secures you the highest possible demand at the best possible price.

6. How much money do you make?

If you consider the cost structure that your business has, versus the revenues that you imagine you will achieve:

  • How much money is left on the table at the end of each month, each quarter and each year?
  • Is the residual income sufficient to reward you for the risks you are undertaking and the effort you are investing into the business?
  • Is there enough cash flow to sustain growth and to fend off competitor interest, should it arise?
  • Are your earnings sufficient to meet your longer term expectations, and those of your shareholders or investors?

If you are not comfortable with cash flow analysis, get some help from someone who is. If your business isn’t generating cash the business model won’t sustain.

7. How are you different from your competitors?

What separates you from your competitors? Why would a customer buy from you versus another industry player? When there is parity in the market, the lever to shift is price. Those lofty revenue ambitions that you set drain away as you relentlessly discount to win business.

Your differential needs to be clearly definable and must be something meaningful to your customers. It is absolutely pointless to excel at something that is meaningless to your customer.

There are certain things that you must do to play in the market, and then there are things you can do to win in the market. How do you win over your competitors? Unless you have a distinct and definable differential, expect to compete on price.

8. How do you delight your customers?

There is a vast difference between locking your customers into a contract for 24 months – so that they cannot leave you even if that would be their choice – to designing your offering to be so attractive to your customer that they choose to remain with you, despite competitor approach.

If you don’t believe this is possible, consider the millions of Apple fans and how unlikely it is that they will defect to other providers. Delighting customers means really understanding what they want, what they need and when and how to give it to them.

Remember that in marketing, everything counts, so this question must be answered in the context of all the marketing P’s – product, price, place, promotion, people, process and physical environment. With the digital age upon us, these can be expanded to include participation, prediction and personalisation.

Related: 6 Thought Provoking Leadership Quotes That You Should Actually Follow

9. What happens if …

A large part of your strategic planning approach must be to scenario plan. We are in a VUCA world, and as a result, things happen that we did not anticipate.

Any business can overcome the smaller humps and bumps. However, what if a ‘black-swan’ event occurs; an event that is very rare, but highly significant, to the extent that it is game-changing. Think in the context of how AirBnB disrupted the hotel industry and how Uber has changed the taxi industry.

  • What if an AirBnB or Uber arrives in your industry?
  • What if they take your largest customer?
  • What if they undercut your pricing by some margin?
  • What if they offer more value than you can afford?

Negative events should not be the only thing you consider in scenario planning.

  • What happens if one of your competitors goes up for sale?
  • What happens if one of your competitor’s largest distributors approaches you for business?
  • What happens if the opportunity of a lifetime presents itself on your doorstep?
  • How ready will you be able to leverage the opportunity to your advantage quickly?

10. What next?

This is a question that every entrepreneur must hold in their mind, because it dictates how the business is managed and run.

  • Is the business being built for sale in 5 years?
  • Are you actively looking to franchise at a future point?
  • Are your plans to expand into Africa or other continents in the near future?
  •  Is the business being run as a cash cow with the intention of an exit within the next few years?

Each of these strategies has a very different and distinct way that the business must be managed. You must know therefore, with clarity, what your intended future holds.

Once these 10 questions have been asked and answered to your satisfaction, they will need to be asked and answered again in a repeating cycle. The process of gaining and maintaining clarity around your business is never-ending. The business environment is always changing. Similarly, you as an entrepreneur are not static in your needs. Clarity is business alchemy. And knowing the answers to these ten questions at all times during your entrepreneurial journey enables you to transform your business into gold.

Janet Featherstone is an international business & executive coach, consultant and strategist. Janet is a professional associate at GIBS. Connect with Janet at https://za.linkedin.com/in/janetfeatherstone.

Leading

Why Elon Musk’s Vision Should Change Your Business

If you’re not moving forward, you’re moving backward, there’s no sitting on the fence, its one or the other.

Craig Johnston

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It’s about the big picture

Elon Musk is the kind of guy who probably divides the room wherever he goes; in the same way that people either prefer Superman or Batman, soccer or rugby, maybe summer or winter. There’s no sitting on the fence. It’s one or the other. You either like Elon Musk or you don’t. But this article is not about him, its about you and how you are leading your business.

Love him or hate him, I don’t believe any business leader can get away from the fact that Elon Musk, possibly more than any other contemporary entrepreneur, is going to have an influence over your business. And if he doesn’t, he should, not as an individual as much as an archetype.

In the early 2000s another famous South African born entrepreneur Mark Shuttleworth was the first South African to become a space tourist. We were all proud, and asked ourselves what we would do if we had billions of Rands… how would you spend it? Mark’s rigorous preparation and orbit in space riveted the nation, from coffee break conversations to television documentaries and Grade 5 school projects. Everyone was talking about it. Mark’s trip was ultimately the fulfilment of one man’s personal ambition, a dream long-held and finally fulfilled.

Related: What Elon Musk Can Teach You About Getting Funding for Your Start-up

Aligning the planets

Elon Musk seems to be a different kind of dreamer. He does not only dream for himself, he dreams for humanity and that is rare. It is also why I think that his vision is something that every business leader should take note of. Look at any Start-up:101 Pitch Deck and you’ll likely see Guy Kawasaki’s famous 10, 20, 30 format and the first slide trying to answer the question, “What problem are you solving?”

Imagine setting yourself the problem of transitioning humanity into becoming a “multi-planetary species”, as Musk famously declared in a 2017 TED interview, and if that’s not enough, you are also working to revolutionise transport and save the environment through clean energy. In my view, Elon Musk (flawed as he may be) represents, two essential qualities that are absolutely indispensable for leaders and businesses of the future: Hope and Vision.

The lever that Musk has chosen to crank open the future, restore hope and unlock his vision, is technology. Misunderstood and much maligned, technology; like Musk, also instantly divides a room.

Technophiles on the one side, technophobes on the other and you must choose. You cannot half use technology, you either opt in or you opt out. The only choice is whether you will use technology responsibly or not. This is no small question and something that many business leaders (including Musk) have shown some commitment to by adding their support to organisations such as the Future of Life Institute.

Ships are not built to stay in the harbour

Technology is agnostic, it is neither good or bad. It’s influence lies in how you choose to use it. With so much talk about the Fourth Industrial Revolution (4IR), and how it is going to impact our lives and, in a business context, the lives of our employees it seems prudent that, as leaders, we establish a clear vision for technology in our businesses with due cognisance of how it is likely to impact our staff and our customers alike.

A business that integrates machine learning and AI into its business management system, for example, may in future have unprecedented access to information, provide intuitive robotic support 24/7, and the power to influence behaviour. This goes beyond ‘old-school’ marketing and advertising, heading into untested waters.

While we should rightly rely on our policy makers and legislators to put regulatory frameworks in place to guide how we use technology, as business leaders we should already be taking the first steps towards developing a technology-use policy in our businesses.

Related: Elon Musk’s Formula For Successfully Growing Companies Faster

Like Musk, our aim should be to bring hope and share a vision. A hope that, even with the threat of diminishing resources in our businesses, we are up to the task of conceiving novel and exciting alternatives that, even if it looks different than in the past, are able to meet the needs of our people. And a vision, not just to increase shareholder value or to be the leaders in our field, but something aspirational.

A commitment to lift eyes and hearts with a big vision, maybe not for interplanetary travel, but at least to let your Enterprise boldly go where it has not gone before, not as a tourist, but as the captain of your ship. Because if you’re not moving forward, you’re moving backward, there’s no sitting on the fence, its one or the other.

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Leading

6 Ways To Lead In The Multi-leader Economy

Why business leaders today compete for mindshare among their employees, and how they can lead.

Don Packett

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I recently attended an event where a CEO delivered the company’s annual results and outlined its future strategy. He closed the talk with some inspirational content to get the team excited about the year ahead.

While I listened to this business leader speak, I also had my eye on the audience. While the content was relevant and inspiring, the narrative and delivery was off. This was evident in the audience, who seemed disengaged – most had their faces in their phones. These employees, who should be inspired by their leader, were simply biding their time, waiting for the next speaker.

Was it because they’re generally rude, disengaged people? Not at all. In fact, they were a phenomenally switched-on crowd when we presented to them. So why weren’t they listening intently to the proverbial captain of the ship?

Leadership competition hotting up

I believe it’s because leaders today are competing for the attention of those they lead. People are exposed to hundreds of potential leaders in their daily lives, and that number grows daily as the internet brings a whole host of outside influence into reach.

While many of these influencers are not tasked with leading, per se, great leaders seldom have to force a following. They naturally build one through an innate ability. They achieve this by delivering inspiring and engaging content on a regular basis via platforms like Facebook, Twitter, LinkedIn, YouTube, podcasts or TED.com.

And it’s not just inspirational visionaries like Jobs or Branson who people listen to today. Anyone with a strong message can self-publish to spark debate, inspire or influence.

Related: 21 Tanks: Don Packett and Richard Mulholland

Understand the new dynamic

will-smith

Accordingly, whenever a leader steps up to deliver something relevant to their team, they need to be aware that in the past 24 hours their audience has probably watched people like Simon Sinek, Mel Robbins or Will Smith deliver a message that could spark a different way of thinking.

If you’re a business leader and have not considered the possibility that your team is also being influenced and, often, led by a host of other leaders, then you’re in for a tough time. The reality is that leaders now face fierce competition, and as the head of an organisation you need to take charge and own that space.

Here’s how you can take the lead in leadership:

1. Maintain face-to-face engagements

This is still the best way to work, especially when talking about important matters. I have a standing one-hour meeting with my team every three weeks. I open this session with a 10-15 minute talk on a specific topic I feel is important. The remaining time is used for open discussion. These sessions have been incredibly powerful, because it’s an opportunity for everyone to have their say, share their views and contribute to growing the business and the team, together.

2. Write narrative that catalyses conversation

This pertains to the content of your engagements. This needs to be something that’s not only on your agenda, but also on your employees’ agenda. People need both answers and guidance, but when leaders and teams can work on both aspects together, magic happens.

3. Deliver with conviction

Leaders often throw out a concern, hoping that it gets resolved. You can’t do that. Leaders need to stand up and deliver with passion to galvanise their teams. Sure, be part of the conversation, and ensure that your team knows how important it this, but understand that it’s more than just a conversation.

4. Get them to challenge you

The proverbial ‘open door policy’ requires employees to walk up to the door. Our regular team session offers me the opportunity to ask everyone, collectively, about their thoughts on a subject. I’m basically standing at the open door and asking them to come in, and not just randomly, but to discuss something pertinent.

Related: Rich Mulholland Reveals His Secrets To Success And How He Plans To Stay There

5. Make the changes required

After listening to your team, take action. Due to the influence of social media, society today is plagued by “ask-holes” – people who ask for advice or ideas, but never action them. Leaders need to listen and take action. Not that you should do everything you team asks, of course, but listening is the first step to understanding, and action needs to follow.

6. Rinse, repeat

Effective leadership is not an annual speaking engagement. It requires constant work to keep teams focused on the business. The biggest failure in most businesses is a lack of communication, which is something leaders need to constantly work on.

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Leading

Want To Achieve Greatness? Force Everyone Out Of Their Comfort Zones

Diverse teams are better performing teams, but only when they are inclusive.

Rob Jardine

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Working in a diverse team feels uncomfortable and that’s why we perform better. Discomfort arouses our brain, which leads to better performance.

Diverse teams are smarter teams. They have higher rates of innovation, error detection and creative problem solving. In environments that possess diverse stakeholders, being able to have different perspectives in the room may even enable more alignment with varied customer needs.

Being able to think from different perspectives actually lights up areas of the brain, such as the emotional centres needed for perspective taking that would previously not be activated in similar or non-diverse groups.

In a nutshell, you use more of your brain when you encourage different perspectives by including different views in the room. However, work done at the NeuroLeadership Institute has proven that this only works when diverse teams are inclusive, and this still remains a key challenge in business today.

When we consider the amount of diversity present in the modern workplace and the addition of more diverse thinking as a result of globalisation and the use of virtual work teams, it’s clear that the ability to unlock the power of diversity is just waiting to be unleashed.

Here’s how you can unlock this powerful performance driver.

The Social Brain

Despite the rich sources of diversity present in most workplaces, companies are still often unable to leverage the different perspectives available to them in driving business goals. Recent breakthroughs in neuroscience have enabled us to understand why. The major breakthrough has centred around the basic needs of the social brain.

We have an instinctual need to continually define whether we are within an in-group or an out-group. This is an evolutionary remnant of the brain that enabled us to strive to remain within a herd or group where we had access to social support structures, food and potential mates. If we were part of the out-group it could literally have meant life or death. We are therefore hypersensitive to feelings of exclusion as it affected our survival.

The brain is further hardwired for threat and unconsciously scans our environments for threats five times a second. This means, coupled with our life or death need for group affiliation, we are hypersensitive to finding sameness and a need for in-group inclusion.

When we heard a rustle in a bush it was safer to assume that it may be a lion than a gust of wind. It is this threat detection network that has kept us alive until today. The challenge is that society has developed faster than our brains. In times of uncertainty we often jump to what is more threatening.

Some of the ways that this plays out is when we leave someone out of an email and they begin to wonder why they were left out. The problem is that it’s easy to unconsciously exclude someone if we are not actively including. The trouble occurs when we incorrectly use physical proxies to define in-group and out-group, as this is the most readily available evidence used unconsciously by the brain.

Barriers to Inclusion

A study done between a diverse group and non-diverse group demonstrates how this plays out in the work place. Both groups completed a challenging task and were asked how they felt they did as a team after the exercise.

The effectiveness of the team and how they perceived effectiveness were both measured in the study. It’s no surprise that the diverse team did better in the completion of the problem-solving task, but what is surprising is that they felt they did not do well. In contrast, the non-diverse team did worse, but felt that they had done well.

Working in a diverse team feels uncomfortable and that’s why we perform better. Discomfort arouses our brain, which leads to better performance. It feels easier to work in a team where we feel at ease in sameness, but in that environment we are more prone to groupthink and are less effective.

Creating Inclusion

We can’t assume that when we place diverse teams together we will automatically reap the rewards of higher team performance. As discussed, we’re hardwired for sameness and if we’re not actively including, we may be unconsciously excluding.

If we want diversity to become a silver bullet, we need to actively make efforts to find common ground amongst disparate team members. This in turn will build team cohesion and create a sense of unity, including reminders of a shared purpose and shared goals. Many global businesses put an emphasis on a shared corporate culture that supersedes individual difference.

It’s the same mechanism that is used in science fiction films that bond individuals together against a common alien invasion. It can also be used to describe why we felt such a great sense of accomplishment during the 2010 World Cup as we banded together as a nation.

We must also make sure we uplift all team members by sharing credit widely when available and recognising performance. The last thing we can do to further inclusion is to create clarity for teams. By removing ambiguity, we allow individuals to not jump to conclusions about their membership within groups and calm their minds so they can use their mental capacity to focus on the task at hand.

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