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Applied Acumen founder Richard Shipperbottom examines why many established businesses struggle in an area where entrepreneurial start-ups tend to excel: Market Agility.
One of the most critical aspects of sustaining business growth is the ability to quickly formulate ideas that meet (or maybe even create) market need, take those ideas to launch, and nurture the new-born product or service to a sustainable, live income stream in your sales line.
We typically refer to the above set of qualities as Market Agility: The safeguarding of your short and long term business success by being able to adapt to changing market demands and conditions.
As suggested by the title of this article, Blockbuster was one such business that failed to be agile enough, unable to cope with the rather sudden change in market demand and conditions.
We can view Market Agility in 3 distinct but linked phases. These are:
Phase 1 – innovation and the formulation of ideas
This is where start-ups are perceived to have a key advantage, unencumbered by the constraints of pre-existing systems, structures and ways of thinking.
Internet businesses tend not to think about rent, rates and leases, for example, or how to meet obligations to 300 existing factory employees. Most could operate out of a Garden shed or on a sunny beach – internet connectivity permitting.
But why should this be the way a bigger, established business thinks?
Perhaps if Coca Cola had thought about it differently, they might have invented Red Bull instead of (or in addition to) Cherry Coke back in the mid 80’s.
There is much talk of “disruption” shaping business today, but the first thing you should disrupt is the way you generate ideas!
Phase 2 – taking ideas to launch: from innovation to discipline
The speed and frequency with which you can get new ideas to market is critical.
The process from idea generation through to launch can be streamlined to reflect the quicker decision making done in start-ups, and made more robust at those points of decision and action.
We see companies stumble in this phase, in every sector of industry, suffering
● Huge product lead time
● Products launched that aren’t ready, and need fixing “in service”
● Products launched behind schedule
● Late design approvals causing delays
● Operations not able to physically make the product
● Costs spiralling out of control
● An overloaded New Product Development (NPD) department
Any of the above signals an NPD process that needs attention.
Phase 3 – Nurturing your new baby
With all that effort and all that hope, all investment of time, energy and money, it is no wonder that there is a certain level of expectation when it comes to launch.
It is upon this shore that all the mistakes, the omissions, the quick fixes and the short cuts will wash! Your complaints, your recalls, your reputation, all will need to be fixed in phase 3, and it is the most expensive time to fix these things, but fix them you must.
More typically, it is here that your operational execution needs to work for you, not against. Do not let a drive for efficiency stifle the response time, volume and flexibility of your customer demands!
Do not let purchasing behaviour constrain your profitability, or sales and service behaviour do likewise to your growth.
All these phases can be measured, developed and managed. More than anything, retain the belief, the ambition and the enthusiasm for every new product as if it were your first and only one, just like a start up!
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