A lecture on how to introduce and utilize IT presented by IT consultant Masayoshi Saito for business developers of companies. In the 6th session, we will introduce the points to keep in mind when formulating a strategy.
Things to keep in mind with new business strategies
Draw as a story
It is necessary to draw a strategy such as how to proceed with a new business, approach to customers, and business development as a “story” and supplement the missing information. People involved in business planning and on-site businesses tend to want to analyze anyway. However, when trying to start a new business from now on, on the contrary, it is necessary to have a perspective that comprehensively grasps the entire business and grasps it as a story of how to realize it along the time axis. .. Then, it is necessary to investigate the information necessary to draw the story and to reinforce the story while modifying it.
In the process of advancing a new business along with the story, various events occur, but there, we show an analytical attitude, calmly grasp what went well and what needs to be improved, and correct the story. It is necessary to go on.
Strategy is drawn as a story from a comprehensive perspective, and practise is essential for success by accumulating improvements from an analytical perspective.
Think inside out
Instead of deciding the strategy based on the prediction that “the world will be like this”, it is to decide the strategy based on our own intentions of “I want to do this in the world” and “I want to do this in the customer”.
When “drawing a story” in the previous section, the outside-in idea of grasping the world analytically and trying to match it with the world will not create a unique idea, and it will be a clear differentiation. Cannot be produced. Rather, we should try to draw attractive new businesses by actively drawing ideals and dreams and having inside-out ideas such as how to realize what we should be envisioning.
Of course, we have to think from the fact that we realize the issues in the field mentioned above, rather than drawing a figure that should be just a one-sided assumption. In other words, instead of trying to solve the problem as a symptomatic treatment, we will investigate the facts underlying the problem and aim for it as a big story, including the overall workflow and mechanism of the problem. It is to draw the ideal figure.
Having a positive perspective of “I want to do this in the world” while referring to “The world will be like this” will lead to the creation of attractive strategies.
Decide what not to do
It is important to make a difference from your competitors by deciding “what not to do” rather than “what to do”. When trying to gain a competitive advantage, there are ways to show the difference between other companies and your company depending on which is better, and there are ways to show the essential difference that cannot be compared.
For example, the former is “quantitative discrimination” because it can be measured by numerical scales such as price and size. The latter is “qualitative differentiation” that differentiates in terms of design and the market to approach. In new businesses, the latter must be emphasized. When thinking about it, it is important to think about “what not to do” rather than “what to do”.
That’s because businesses are always constrained by funding, talent, and skills. It cannot be ignored. Therefore, instead of thinking about “doing anything” as much as possible, we will identify the real needs of the target customers and markets, narrow them down to the realization of qualitative differentiation, and actively “what to do”. It is to decide whether to do it. Then, “what to do” will be decided naturally.
Doing whatever you can do is not enough resources and you cannot guarantee speed. The first is to narrow down what you need to do to make the essential difference, decide what you don’t want to do, and bring it to market as soon as possible. And it is important to gradually increase what you do as needed.
Be careful with new business strategies
Do not aim to create a “new business plan”
“What do you want to sell?”
I once asked this question after receiving an explanation about a new business.
“I know what you can do, but what kind of business are you trying to make it?”
He said he hadn’t thought about it yet.
“I understand the general needs, but specifically, who is in what kind of scene, what is in trouble, and what do they want to do? Do you have that feeling?”
It’s easy to imagine that an imaginary business without a real, real “user” wouldn’t work. Nevertheless, they conveniently connect what they can do with general theory, draw new businesses, and create “coherent business plans” as if they had great potential. I have witnessed such a scene many times. Why do you do that?
That’s because their purpose is not to create a “new business”, but to create a “new business plan”.
The plan needs rationality that the approver can understand. For that purpose, I tried to connect words and numbers that the management can understand, such as experience, existing customers, topics of the street, and make a plan that seems to be easily convinced without giving unnecessary stress to the other party. I will. Easy-to-understand things and logic are prioritized, and facts that do not fit are discarded.
As a result, we create a market that is convenient for our existing business assets such as what we can do and existing customers, create a customer who behaves in that market in a way that is convenient for us, and that is convenient for that market and customer. By giving the data and its interpretation, you can create a business plan that seems to work.
In the first place, a new business is the development of new markets and customers, so “known” and “existing” cannot be used as they are. Nevertheless, if it can only be considered as a known or existing extension, it can no longer be called a new business.
Also, the decision-making process of not approving a “new business” unless it can be explained in the same format as the existing business plan is also a hindrance to new business development. If you stick to the decision that “if you do not have a business plan that is backed up as data, you will not approve it”, even a business plan with a good idea will not be evaluated and will be crushed without being implemented. Even so, due to the pressure to somehow take shape, the goal was not to “realize and succeed in a new business” but to “create and report a new business plan”, making it an ineffective initiative. It’s over.
The purpose must be to create a “new business” rather than to create a “new business plan”. Otherwise, you will never have a successful new business.
Appropriately set performance evaluation criteria
Until now, the performance evaluation criteria have been sales and profits, and even if they are applied to new businesses as they are, it may not be possible to gain motivation in the field. For example, if the existing business has a flow-type business structure that mainly sells goods and provides services, the performance evaluation criteria should be sales and profits. However, aiming to shift to a stock-type business structure that provides continuous services will be accompanied by a temporary decrease in sales and profits. If we do not allow it and change the performance evaluation criteria accordingly, we will not be able to maintain motivation in the field.
No matter how good the new business is, if the performance evaluation criteria are not suitable for the new business, the site will not move and the purpose cannot be achieved.
At first, it may be possible to convince people with the theory and spiritual theory that they should be, but if you do your best but it does not lead to your own performance evaluation, the field will eventually run out of breath.
For a new business to succeed, it is necessary to create performance evaluation criteria suitable for that business. If it can be done, the site will move. As a result, the significance of the business will be understood and the morale of the field working on the business will be fostered.
Don’t set unfounded goals
“I want you to realize a business of 1 billion yen in 3 years.”
Given these unfounded goals, they can put pressure on people who work on new business development and demoralize them.
If you are filtered to “1 billion yen in 3 years”, even if you come up with a good idea, you will reject it yourself, saying “This cannot be achieved. It’s no good.”
Of course, business needs KPIs and backing. However, instead of “1 billion yen in 3 years” from the beginning, a feasible KPI such as “1 million yen in 6 months” would be fine. Or it may be a dream, “I want you to make it a pillar of the business that will support the company in the future.” That way, even if you make a mistake, something that leads to the next may remain.
In this way, you can repeat trial and error without picking the buds of ideas. Then, when you can see the cruising speed of the business, why not give a KPI such as “100 million yen next year, 500 million yen three years later”. By reflecting this method in the performance evaluation criteria introduced earlier, it is necessary to maintain the morale of the field.