Business: Old School vs. New School

As we all know everything has changed since the financial collapse of 2008, but how exactly have businesses changed?  I'm going to break it down to its simplest form in this "old school vs. new school" post.   Alright, here we go! (seasonally appropriate colors are a coincidence)

Old school: Profits above everything else.  New school: Triple-bottom line (Economic, Environment, Social).

Old school: Keep business units separate. New school: Integrate cross-functional teams.

Old school: Large capital investments (infrastructure, people, resources, assets, etc.). New school: Bootstrap.

Old school: Pleasing shareholders is the be-all-end-all. New school: Equally pleasing shareholders and stakeholders.

Old school: Very few industry players. New school: Ultra-competitive across industry.

Old school: Focus on short-term goals and gains. New school: Focus on long-term sustainability.

Old school: Put all eggs in one basket. New school: Have multiple baskets.

Old school: Productivity measured by how long/how many hours worked. New school: Productivity measured by how much you get done.

Old school: When facing declining profits -- cut, cut, cut, no matter what (mostly employees). New school: Do what you can to keep the team in place.

Old school: Vertical hierarchical structure. New school: Horizontal organizational structure.

Old school: Money flows up to executives at the expense of employees. New school: Money still flows up, but in a more balanced way.

Old school: High barriers of entry. New school: Low barriers of entry.

Old school: Control of consumer behavior. New school: Consumers have the power.

Old school: Cold calls. New School: Social Media.

Old school: Huge slow moving entities. New school: Lean and agile.

Old school: Mimic successful traditional business models. New school: Disrupt.

Old school: Move slowly when making business decisions. New school: Adjust and implement on the fly.

Old school: Managers and Execs have all the power. New school: employee empowerment.

Old school: Traditional Advertisements (TV, Print, Billboards, etc.). New school: Social Media, Blogs, Online videos, Mobile, Podcasts, etc.

Old school: Power/Control economy (control every aspect of business). New school: Sharing economy.

Old school: Heavy investment in human capital. New school: Automate.

Old school: Cubicles. New school: Open.

Old school: Work harder. New school: Work smarter.

There are definitely more differences between businesses of today vs those of 10, 20, 40 years ago; however, these are the main ones I could think of off the top.  Obviously, each should be defined further but that can be done by researching the internet, going to a top business school, or hiring a consultant.  I do understand that few things in business still remain: bring in more than you spend, bottom line, good/great leaders, innovation, customer service -- to name a few.

If you have any others that I have missed, feel free to list in the comments section.  I'm curious to hear what others think.

Until next time.

ModernManTellsAll

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Entrepreneur: Launching a Business

Having been a part of numerous startups over my career in various industries, and having known and knowing close friends, family members, and business associates that have made the leap and taken the risk of starting their own businesses, I wanted to share a few things that I feel are very important to get right from the jump.

1) Write a business plan

This is a BIG one, yet is rarely executed properly, if it's even done at all. Many entrepreneurs and small business owners feel they have a great idea for a new product/service, feel they can take an existing product/service and do it better than what is currently on the market, or have an incremental innovation to an existing product/service that will enhance the consumer experience and fulfill a need. In fact, these reasons are why most businesses and startups are launched, however, 3 out of 4 will fail! That is an extraordinary high percentage. Yes, some will fail due to lack of capital funding and others will fail by burning through capital far too quickly, and some will fail from lack of leadership, direction, and vision. Regardless of the reason, a lack of a well thought out business plan is more often than not at the root of the problem.

Writing a business plan forces the business owner to carefully analyze why they are starting a business, who their competitors are, what is the market for the product or service, economic climate, etc., prior to investing all that time and money, which is needed to get a business off the ground. Many people I have met with, and worked for actually, will for-go writing a business plan all together, claiming they have it all in their heads; they are purely reacting to scenarios day-to-day. Writing a business plan is a proactive approach as it will help streamline your thoughts, make adjustments prior to launch, enable a clear vision for the business, enable you to seek and procure investors, heck, it may even force you to re-evaluate your decision to start a company all together.

I would suggest consulting with someone who is well-versed in writing a business plan(s) and/or launching startups, even if it may be seen as a costly expense as it will no doubt save you money in the long run and moving forward. If you do not know anyone to consult with, or if you find it to be too costly there are many websites that offer business plan templates for a limited one-time fee, some may even be found online for free. However, I would be cautious of anything that is free as many times in life you get what you pay for.

2) Determine your target market(s) and position your brand accordingly

This one is all too common as well. You have a great product/service that is ready for market, perfect let's start making some money! Right?? Well, of course one wants to make money, but who exactly are you selling to? A small business or startup (typically) does not have the resources to just get a company off the ground and start selling to anyone and everyone that is ready (or not) to buy. Furthermore, marketing can be an expensive business unit, particularly without a clear target market(s), as much will be wasted (time and money) while you're testing to see who is going to be a viable customer for your business. Determining your target market(s) should be done prior to launch, again a proactive approach, not a reactive one.

Once your target market(s) have been identified, it is extremely important to position your brand accordingly. What do I mean by this? Well, let's say you have targeted the high-end, high-quality coffee consumer market - essentially competing with Starbucks. This would not be an easy task, even with a well-thought out business plan and preparation; however, it could be done with a focused strategy. Therefore, when you position your brand on the high-end, high-quality market, all of your branding and marketing should be targeted as such. You want to go full-bore and start capturing market share in that space immediately. Far too often I have seen companies without a defined target market and brand positioning waste valuable resources at a fast-clip by trying to serve any and all markets, even to a market that would never pay $2 for a cup of "drip" coffee or $5+ on an "Orange Mocha Frappuccino" (couldn't resist the Zoolander reference).

3) Start tracking financial (costs, expenses, revenues) and sales data immediately

Many new (and sometimes experienced) entrepreneurs and small business owners fail to do this as they just jump right in and start producing and selling their product/service. I am all for initiative and motivation as that is what is going to enable your company to survive and thrive, however, prior to launching I'd recommend putting the data tracking applications in place. This can be accomplished through the use of Excel, Quickbooks, Quicken, or any other new app/software that is out there in the market place (there are a lot of them). Again, this may seem like an obvious implementation, but you'd be surprised how many business fail to have this in place, or have started it but stopped for whatever reason, too busy, lack of spreadsheet knowledge, I'll do it later, etc.

The problem with failing to track financial and sales data is that as it accumulates and business operations pick up (hopefully), the harder it is to go back and input the data. Furthermore, having all your data tracked will enable you to compare data from previous days/weeks/months, forecast sales, procure more capital in the future, find partners and investors, identify issues, etc. In today's technological world financial tracking and data storage is highly accessible and in many cases fairly user-friendly. Once again, I'd recommend consulting with a professional on this matter, at least initially to setup the templates.

Obviously there are many other factors that go into launching a business, many of which have been posted in other posts on LinkedIn. However, I feel these 3 are major factors to consider prior to launching a business and in the long run save you a lot of time, money, and headaches moving forward.

As always, I'd love to hear your comments on this topic, so please leave comments if you desire.

PS - If you are in need of any Business and Marketing consultation for your small to mid-sized business/start-up feel free to shoot me an email at: modernbizstrategy@gmail.com.

Cheers,

ModernManTellsAll

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