FJ Rutjes | Business NOT as usual

ACTION IS REACTION
Action is reaction. Or perhaps in the case of InnoTown, the other way around. Because most attendees react the same after listening to those that make up a carefully curated InnoTown program: I am going to do that!

I dare you to sit through two days of inspirational, curious, serious and personal stories of business not as usual and not feel energised to act.

In the spontaneous community that InnoTown creates for like-minded entrepreneurs, feeling a desire to change comes standard, really. But as with anything, once you step outside of such a positive, through-provoking & vital time-out experience like InnoTown, everyday work can take the wind out of your sails.

For some it is that overflowing inbox, for others those deadline responsibilities, cynical colleagues or no true clarity on where to start. But the net result is the same: it is easy to run out of steam. And it doesn’t matter whether you attend conferences or in participate in internal innovation or inspiration sessions, actually turning what inspires you into food for thought & fuel for action, is hard. Really hard.

But fear not: we can all take practical steps to prevent ourselves from losing momentum and wasting the energising effect of events like InnoTown.

MAKING INSPIRATION WORK FOR YOU
The fuel for good innovation & change is inspiration. This means that whatever you will bring back from an event like InnoTown 2014, needs to be inspirational. And with that we do not just mean not your personal enthusiasm. It is wise to remember that it is you, not your colleagues or business partners, that will have the pleasure of experiencing InnoTown 2014. And however energetic your retelling, however visual your presentation, however compelling your personal belief on the need for action, it will never compensate for the fact that it was you – not them – attending.

To deliver true Return on Innovation you will need to arm yourself with the skills to properly capture inspiration, land your learnings in clear & actionable ways and create an energising take-home message for your own audience. These three ingredients will create a spark that can help to set change in motion back in your own organisation.

OUR RECIPE FOR INSPIRATION MOMENTUM
Expertly capturing what inspired you, rather than just taking casual notes will stop you having to try to reinterpret what you heard. Landing your learnings in a constructive way will give you solid arguments, not just textbook reasons to start doing business not as usual. Building an energising take-home message instead of personal anecdotes will help to turn your colleagues into advocates for real action.

In our everyday work with clients, we see first hand how hard it can be to do this. But … we also know that doing it well creates the ability to generate competitive momentum that makes a real difference to customers.

InnoTown knows how important this momentum – and acting on fresh inspiration – is. Doing something new & different is not just one of the core beliefs on which InnoTown is founded. It is also the one thing that runs deep in the personal experiences of InnoTown speakers. Everything that makes them compelling to listen to and watch on stage comes from them taking action.

START SMART
Remember: the biggest compliment you can pay to those that inspire you – at InnoTown or elsewhere – is to make sure that you act on how their view of the world is changing yours.

If you want to attend InnoTown and get the most out of your experience, then start smart: join us for the InnoTown Kickstart workshop. Start putting in place some smart techniques that help you maximise your ability to capture and use inspiration effectively.

This way, from the moment the lights go out in the InnoTown auditorium for the first speaker, you are ready. Ready to turn insider know-how & the unique business lessons of world-class speakers into tangible action.

For more information – and to join us – click here.

What Strategy Is Not

Of course, every company says they have a strategy. In fact, I am pretty sure most of them have a document labelled “Our Strategy”, or at least a powerpoint presentation of that name. But, in fact, not many companies really have one. Here are some of the most common mistakes – or poor excuses for a strategy.

Goals are not strategy. “We want to be number one or two in the market”; I am pretty sure you have heard that one before. Well, it is not a strategy; it is a goal. And there is nothing wrong with having an aspiring goal, but strategy is how you endeavour to accomplish it. Strategy involves making choices; genuine choices. Of course, being number 1 or 2 in the market is not really a genuine choice, which requires trade-offs, and giving up something that could have worked as well. Nobody will choose to be number 32. In fact, a Silicon Valley CEO wrote to me saying “it is like stating, ‘My strategy to win the 400 meters at the Olympics is by running faster than anyone else’”. A good goal, but it does not tell you anything about how you intend to achieve it. Your route towards the goal; that is strategy.
Strategy is not what you were doing anyway. Most companies, when writing up their strategy, look for some formulation that fits in all the things that they were doing anyway. There is nothing wrong with that, if what you are doing, happens to constitute a consistent set of coherent choices, i.e. a strategy. But more often than not, it leads to some amorphous statement that is designed with the sole purpose of not giving anything up; no matter how disjointed the current set of activities. The worst I have seen was the supermarket conglomerate Ahold, which stated to be “multi-format, multi-local, multi-channel”. It did not exclude anything. Not coincidentally, this was shortly before they collapsed.

Strategy is not secret. Some companies really have formulated a wonderful strategy; a coherent set of genuine choices about their value proposition and the precise set of customers that they are going to serve, but when I ask middle managers lower in the organisation, they are unable to tell me what it is. I am sorry, but then you do not have one either. A strategy is only really strategy if alters the behaviour of the people in your organisation; what they do and how they do it. If nobody knows about it, it cannot influence their actions and decisions. In which case it may be an impressive powerpoint; but a strategy, it is not.

Professor Costas Markides, of the London Business School, put it well: “strategy is about making choices; about ‘who, what, how’: who is our chosen customer; what are we going to sell; and how are we going to deliver that value proposition”. It should lead to a coherent set of mutually reinforcing choices. For example, Nespresso’s strategy is to sell an easy-to-use system for consuming high quality espresso at home, sold directly to individuals via their Nespresso club. It involves a clear set of choices, that fit together. The litmus test for any strategy is whether what you are not doing is meaningful and could be profitable for someone else (e.g. serving offices, or filter coffee, or selling coffee in supermarkets). If someone else is making money on what you choose not to do, it just might be a sign that you have a good strategy.

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FREEK VERMEULEN | STRATEGY + BUSINESS

Freek Vermeulen | How Would You Define a “Great Company?”

Last week, I was interviewed by a journalist from Korea’s Maeil BusinessNewspaper (the local equivalent of the Financial Times). After quite a lengthy discussion, he ended by asking, “How would you define a ‘great company’?” I thought it was a bit of a lame question—but my answer to him seemed at least as lame. I babbled that (1) I would judge a company by its performance (a long-term record of above-average profits) and (2) employees should really enjoy being part of that organization.

At the time I didn’t think it was the sharpest exchange of the day, but when I considered it for a while afterward, I started to really like the question—and even to appreciate my answer to it! This might be my memory playing dirty tricks on me—in a feeble attempt to protect my self-image—but if asked today, I would likely give more or less the same description.

I think most would agree that you cannot call any firm a great company when it is habitually underperforming. But great financial performance is not enough. At the end of the day, an organization is nothing more than a collection of individuals working (more or less) together. If the people who constitute the organization do not enjoy being part of it, I have a hard time seeing it as a great company.

I realize some of you might prefer to bring customer satisfaction, if not other stakeholders, into the mix. Yet, to me, employee satisfaction is the pivotal point of departure. The legendary founder of Southwest Airlines,Herb Kelleher, used to proclaim that employees (“not customers or shareholders”) were most dear to him. That’s because he figured, if you have happy employees, they will make your customers happy. And happy customers will come back, which will eventually make your shareholders happy too (and, not coincidentally, Southwest had a generous profit-sharing scheme, basically turning employees into shareholders). Southwest has been outperforming its peers for decades.

Yet, most of us—investors, included—continue to underestimate the power of employee satisfaction. Alex Edmans, my new colleague at the London Business School, recentlypublished a study that examined the effect on future stock returns of a company making it onto Fortune’s list of “100 Best Companies to Work For.” He found that such a company subsequently generated 3.5 percent higher stock returns per year than its peers. This finding suggests two things: (1) this employee satisfaction thing really works; having happy employees eventually culminates into hard stock returns; but also (2) that the stock market still undervalues its importance. The stock market habitually fails to anticipate these extra earnings, owing to employee satisfaction (even though the list of 100 Best Companies To Work For is public knowledge).

There is money to be made from employee satisfaction. Let’s all get rich and happy, but not necessarily in that order.

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FREEK VERMEULEN | STRATEGY + BUSINESS