Small Business Innovation
December 30, 2005
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Small Business Innovation
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229 MB
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Music in this Podcast by Rob Costlow and Adrina Thorpe.
What Distinguishes a Business Owner from a CEO?
December 28, 2005
The Business Owner
The entrepreneur gives birth to his idea by starting the business and concentrates on sales, marketing, operations and customer service. Often he is happy to survive as he struggles to make payroll and pay the bills.
A business owner is often highly involved IN the daily operation of their business. In many cases the business could not survive without them because they are well versed in their trade or profession and posses strong technical skills. But they have not been able to successfully transfer those skills, recruit or retain the right people, and organize the business. His management model looks like a wheel with himself being the ‘hub’.
What Moen Can Teach Small Business Owners About Innovation
December 26, 2005
I was reading at Cleveland.com a story about innovation that described how 70 years ago Al Moen turned on an old-fashioned two-handle faucet and a sudden burst of hot water burned his hands. It convinced Moen he could come up with something better. Moen invented the one handle faucet.
The one-handle faucet is an excellent example of how an accident fueled the belief that there must a better way and in the process of looking for a solution - created an innovation, the one-handle faucet.
Today, Moen’s Chief Executive Richard Posey says innovation is how his company maintains its spot as market leader. The company’s culture stresses that sales growth comes from designing products consumers want to buy, not by shaving pennies in the production process.
Innovation is Not New
Humanity has been innovating since the beginning of time, back then, it was better known as ’survival’. So while innovation is not new, what has changed is the important role innovation plays in fueling business momentum.
I have been actively watching, researching and tracking business development trends since the early 1990’s and can tell you that there is a lot more attention and discussion around the process of innovation and how to make it a management discipline, than ever before.
I hear it from CEO’s, the media, and podcasts and now I am writing about it and plan to make it a regular part of what I read, track, and write about. It is time - innovate or evaporate.
Why am I paying so much to attention to ‘innovation’?
Like the Industrial age (1880-1930’s) fueled change in business, closely followed by the Information age (1940-2000) and the proliferation of information being distributed using digital networks (Internet), I predict that the next few decades of the 21st century will be remembered as the Innovation age.
Recognize the Opportunity
You might be asking yourself what in the world this has to do with you and your business, everything actually.
Just like the mechanization of farming practices increased the productivity of the family farm and the assembly line revolutionized the Industrial age, innovation will shape the way entrepreneurs approach starting a business and the way corporations are managed.
The Challenge
Since the 1920’s the industrial model approach to management (decentralized operating systems, centralized policy and financial controls) it is still the predominant strategy used to organize and manage many businesses. The problem with this approach is that the industrial model was designed to deal with the challenges of an industrial age ??? but now we operate our businesses within a different context, for example:
- global competition
- instant communication (Internet: email, IM)
- consumer generated media (blogs, podcasting etc.)
- on-demand anything (printing, publishing)
We Need a New Management Model
Unfortunately, the ‘industrial context’ and approach to managing a business does not suit the ‘context’ of our environment. Countries like India and China are experiencing their own ‘industrial revolutions’ in a connected world that did not exist for most of the North American industrial age.
- Be Open: business owners, be more open-minded. That employee who bugs you with ideas and changes might be on to something.
- Encourage Change, Reward Innovators: just like sales people are rewarded for results. Consider how you could reward employees for their innovations.
- Grow the In-House Entrepreneur: recruit, cultivate, and support entrepreneurs to operate within your business.
- Change how we Define Success: shift from measuring Efficiency of Outputs (industrial model) to gauge the ‘Effectiveness of Outcomes’ and ‘Magnitude of Innovation’.
Beefs and Bouquets
How are you coping with developing your business? How have you incorporated innovation into your business? What challenges do you see in shifting from a management culture to an open, innovative culture?
Leave a comment below or send me an email.
Passion and Curiosity Begets Innovation
December 24, 2005
The Apple does not Fall far from the tree… in this review of a video that Google Video has made available, I share my insights and observations of the free video of “An evening with Steve Wozniak” (Woz). Woz was the creator of the first Apple, Apple II and Apple III through to the creation of the MacIntosh. (courtesy the Computer History Museum) The video is a little more than 90 minutes.
Copy on the Google page states “Woz serves up Apple Computer history in his own unique way. Steve will describe a sequence for providing a rational understanding of many of the innovations leading to early Apple designs. He’ll look at early company structure, the personalities that influenced him, and personalities within the company. In addition, he’ll discuss the reasons he wants to be an engineer for life but not a CEO.”
Listening to his story from an early age, being the Son of an engineer, and the story of how he created the first Apple computer. What strikes me most is his insatiable curiosity for anything electronic. In this interview Woz painted a picture of how an engineer, inventor, and electronics geek who loved to solve problems. His passion, excitement and curiosity are tangible as he describes the early days - the birth and creation of the world’s best selling computer (early 1980’s).
It is also quite apparent that Woz never really wanted to run a company, he was very shy and IMO that is why he and Steve Jobs got along. Steve looked after the business details while Woz was left to tinker and solve problems. From where I sit, without Steve Jobs Apple would not exist today and without Steve Wozniak being able to tinker, invent and create the history of computing would be very different than it actually is.
I see in Woz very similar attributes that have been well documented in people like Dr. Alexis Carrel, Harvey Firestone, Alexander Graham Bell, Henry Ford and Bill Gates - a spirit of adventure, a voracious curiosity, and the drive to solve problems.
Questions to ponder…
- In your business, how can you separate the inventor, creation, and research and development from the business end of the business?
- Who is your ‘Woz”?
- Who is your inventor ally, co-founder, or partner?
- What are you curious, passionate, and interested in?
- How can you incorporate and cultivate an innovative culture?
Goals, Plans, Actions
December 24, 2005
“Our goals can only be reached through a vehicle of a plan, in which we must fervently believe, and upon which we must vigorously act. There is no other route to success.” - Stephen A. Brennan, American basketball coach
Corporate Culture: Can Your Company Think Differently And Tolerate Diversity?
December 21, 2005
Most corporate culture is dictated by management and can become self-centered, self-serving and arrogant. Every company needs to think differently and tolerate diversity. Having a bunch of clones only doing ‘what they are told to do when they are told to do it’s a recipe for disaster.
The purpose of a business is not to make money but to serve customers and meet their needs. Use common sense. It’s usually somewhere in the middle of two extremes.
Four Deadly Corporate Culture Mistakes:
Three Tips For Managing Entrepreneurs Within Your Business
December 20, 2005
It can be a challenge to absorb, encourage, and retain individuals with an entrepreneurial drive within your company. With a little encouragement and support those employees with an entrepreneurial drive will improve your success and overall competitiveness.
1) Beware Your Bias And Judgment of Entrepreneurs
I started my business out of sheer frustration. I was just “full of it”! Many of the business owners I worked for were open and progressive but unable to see past the “perceived” risk or change to the status quo to see the value of my ideas.
Manager Heal Thyself
December 20, 2005
Are you hot or not? Think you are hot stuff? Feeling pretty good about yourself and your business? Believe it or not there actually was a website that asked this question and people were allowed to vote whether you were hot or not. I wonder what your customers would say about your business? Would you be hot, cold or lukewarm? When was the last time you really took a critical look at your operations? I present you with an opportunity to give yourself a good swift kick in the ass, read on.
Which statement most rings true for how you operate your business? Choose just one answer before you read on.
- I set boundaries for what I will tolerate and accept of my staff.
- I personally set an example in my personal leadership style.
- Everyone understands what I expect of them and perform to my expectations.
After you answer, click the show more link and go to the corresponding answer.
How to Innovate Your Business Like Google
December 19, 2005
It is becoming increasingly obvious why Google has grown and succeeded in the search space online because they are consummate innovators.
I would not consider myself a Google groupie. I have very real concerns about the pervasive, ubiquitous reach of Google if not today, certainly in the near future. They have a saying at Google, ‘do no evil’.
That is of little assurance because I am not sure how I feel about a bunch of brainiacs, nerds, and PHD’s making a decision about what is and what isn’t evil.
Google Gets One Thing Right
Genesis of Complacency Manifesto
December 18, 2005
Slowly, ever so softly something sinister was killing my drive, ambition and draining my passion for life. I was mostly unaware it was even happening…
Yet, I suddenly become aware that I had been infected - with a virus of the mind - I had stinkin’ thinkin’. I felt listless, flat and yet I was still getting my work done. But I felt somehow I was missing something.
I always considered myself an active, self taught and life long learner. Yet on some level I knew I needed to seriously look into how complacency had penetrated my attitudes and beliefs.
What is a small business? What is an Entrepreneur? Why you should care.
December 17, 2005
Recently at The Entrepreneurial Mind, Mr. Cornwall puts up a long post attempting to define the word, entrepreneur. He says at the end of the post:
Maybe I have been in an academic setting for too many years now. When I was an entrepreneur, I know that I couldn’t have cared less about such issues. We were too busy trying to make payroll and get ahead in the market. But now that I am in my Ivory Tower, I find this kind of pondering rather interesting and even a little entertaining.
I have to admit that when I read the title, I thought “What the??” who cares? I am glad to hear that Mr. Cornwall has enough self-awareness to recognize how meaningless the definition of the word entrepreneur has to most entrepreneurs. Except for one important point.
If your small business will ever need to take advantage of SBA programs, it actually could make a difference in whether or not your business would qualify for government programs. On the SBA website they state:
“- a small business concern is “one that is independently owned and operated and which is not dominant in its field of operation.”
But that is where the simplicity ends. The SBA has an Office of Size Standards that “develops and recommends small business size standards to the Size Policy Board and to the Administrator of SBA.” I guarantee that no entrepreneur was a part of creating the SBA, cause no entrepreneur would ever set up an office of “Size Standards” - only government does that.
If you are planning to sell to the Fed’s knowing where you fit into the “Size Standards” will be important.
I feel your pain.
Breakthrough The Communication Barrier - Stop Talking! Start Listening!
December 16, 2005
A common myth is powerful speech and the ability to articulate are the skills which make someone able to influence another.
The power to influence comes from the ability to LISTEN, empathize and connect with someone. He that has the ability to LISTEN to and connect with the other person is the one who can influence them
Effective Communication Is A Two Way Street
The power to influence comes from the ability to LISTEN, empathize and connect with someone. Why? Because the one who is listening is the one in control of a conversation.
Stop Thinking About The Next Thing You Are Going To Say
Powerful LISTENING skills begin with learning how to remain EXTERNAL in a conversation. This means being able to shut off your self talk for the time you are with someone and just listen. When the person is finished, you can think and respond.
]In its most basic form being EXTERNAL means caring more about the other person’s feelings than your own. That means you have to LISTEN.
Beware Of Your Negative Self Talk
If you have a lot of negative self talk and are worried about what you are going to say next, you will not HEAR what the other person is saying to you.
Everyone has been in the presence of someone who really cared about and understood them. You really felt HEARD by this person and instinctively TRUST them.
Show Them You Care
A wise person once said, ‘People don’t care how much you know until THEY know how much you CARE.’
In a conversation the only way they will know if you care is if you LISTEN and then reflect back to them what they have said. I am not suggesting you immediately parrot back what they say — that would be annoying. Rather, paraphrase what they said and add your comments, observations and thoughts to the conversation.
Listening is the foundation of effective communication. Control the conversation by listening!
How Strong Are Your Communication Skills?
December 16, 2005
I have always been intrigued by the power and importance of communication. The tone of this article is purposefully strident. Now, more than ever, we need to hone our communication skills.
The Essential Exchange Of Ideas
The race is on — your customers are seeking leaders. People with the communication skills to help them. For example:
- customers: want to understand how your products or services can help them. If customers do not understand how your products or services will satisfy their needs, they will not buy!
- employees: need clear communication to accurately understand performance expectations, so they can do their jobs effectively.
- suppliers: need a business partner who can connect and communicate effectively with the marketplace.
There is no other business skill with as much potential to positively impact our success. Every day, I learn more and more that the quality of my communication directly improves the quality of my life, business and customer experience…
Clear Communication Creates Trust
It is during the process of communication where value, trust and rapport are created. Quality communication has the power to create trust, influence and powerfully motivate those receiving the message.
Communication forms the foundation of every business, social and personal relationship. We must not take it for granted — we say thousands of words each day. The real question is how many of our messages are effective and hit their intended target?
Perception Is In The Eye Or Mind Of The Beholder
If Communication was a dance, it would be a two step. It takes two to tango. One to deliver the message and the other to receive it. By making modest improvements to the quality of our communication we can greatly impact our business results.
Misunderstandings, miscues and problems occur as each message is being interpreted. In every communication there are two contributors:
- Deliverer: role of the deliverer is to convey the message as clear and concise as possible;
- Receiver: to carefully process and understand the message.
Delivering the message in a clear, easy to understand and attractive package will improve the quality of your communication and believability.
Beware The Communication Disconnect
Somewhere between delivery and reception a disconnect can occur. Both the sender and receiver filter these messages through their own life experience, personality and beliefs. There are a number of factors which can impair your message. For example, try adjusting the inflection of your voice on the words in bold:
- What are you doing here?
- What are you doing here?
- What are you doing here?
- What are you doing here?
- What are you doing here!
Either the receiver or the deliverer can cause the message to be misinterpreted. Changing the emphasis on each word in the phrase “”What are you doing here?”" changes the meaning and impact of a simple, innocent statement.
Also, if a person’s current circumstances are especially stressful, they could interpret the meaning of your message differently then what you had intended.
Changing the tone of your voice and body language can substantially change the meaning of your message. The example of a simple phrase “”What are you doing here?”" could be interpreted quite differently depending on how the message was delivered and received. This explains why two people hearing the same message interpret it differently.
Non Verbal Communication Is The Language Of Relationships
Everything related to marketing and sales always comes back to believability. The way your message is delivered and received impacts your credibility.
A study of non-verbal communication by Albert Mehrabian showed that face-to face interactions, which made up 55% of the emotional meaning of a message, is expressed with facial, postural, and gestural means. 38% of the emotional meaning is transmitted through tone of voice, but only 7% of the emotional meaning is made with the actual spoken words.
Depending on the frame of mind of the person you are communicating with on a particular day, they could attach a completely different meaning to what you say. Anything including their beliefs, attitude or stress could substantially alter the meaning they assign to your message.
Today, try to be a little more calculated in your communication. Observe the people you are trying to communicate with and adjust your message to make it clear and easy to understand. See what happens. A little extra effort on your part could make a substantial difference in the quality of your communication and relationships.
The Words We Say
December 15, 2005
Today I finished writing my second major length book for McGraw-Hill. The title of the book is ‘Tips and Traps for Writing an Effective Business Plan’.
As I sit here contemplating the accomplishment of writing, editing and proof reading almost 500,000 characters in about 100,000 words and more than 368 the enormity of the task being complete is kind of overwhelming. There were days I had serious doubts about my abilities and if I would ever finish writing the book.
I always regretted never going to university. What I find so ironic is that a high school graduate wrote a book on business planning that is competing with authors who are university, college professors and MBA’s. It gives me chuckle because I was labeled in grade school as having an ‘Inferiority Complex’. The reason that has been so significant for me is that as a young boy all I heard was the word ‘inferior’. I cannot believe that I carried that stinkin’ thinkin’ all these years?!
I have decided that I will no longer allow myself to be considered inferior.
So I am doing a little dance to my favorite tunes and celebrating my accomplishment! WoooHoo!!!!! 
Location, Location, Location and Business News
December 14, 2005
Finished writing my new book on business planning. Be in stores summer 2006. Wow, did I learn a lot about business writing that book. I am excited, because when I took on the project I wrote it with the idea to make it the best book on business planning out there. Stay tuned.
My Tips and Traps When Buying a Business Book available in Borders, Barnes and Noble in US and in Canada in Chapters, Indigo and Audreys Books in Edmonton. Also available at:
Download the Show
Locationlocation.mp3
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30.9 MB
You can also listen and subscribe on
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I also have my own ODEO channel, you can visit
My Odeo Channel (odeo/a9164f98a21aae28)
Other Business News
China overtook the United States in 2004 to become the world’s leading exporter of information and communications technology (ICT) goods such as mobile phones, laptop computers and digital cameras, according to OECD data.
I am reviewing a new product called brand it yourself, a brand strategy system, very cool, I like what I hear so far. Will keep you updated.
Yahoo buying del.icio.us is just another indication of their renewing the original direction in building a human powered search engine, except now we build it through taagging and social bookmarking
Marc Andreesen (creator of netscape) has a serect project, Ning.com a social widget that allows you to build you own tools for social bookmarks, photos, restaurants reviews with maps. You name it.
Finding a Location for a Retail Business
Brand Mantra: Positioning and customer insight
December 14, 2005
Back in November I asked Jennifer a question about branding and she has expanded on the topic with a blog post titled Positioning and customer insight.
In this post Jennifer presents using a qualitative approach of interviewing customers to uncover specific needs. She goes on to point out two potential problems with this approach:
- Blind spots.
- Bias and lack of complete information.
She then presents an important distinction, that to be certain that you are on the right track, that you would “…need an unbiased view from a representative sample of customers, prospects and trialers. This requires third-party involvement to coordinate ‘blind’ studies…”.
Jennifer then presents an interesting idea for modeling the feedback/results from the blind studies. “From this exercise, you should be able to draw 3 circles that (ideally) overlap in one spot; that one spot is your positioning”
My take away from her post is that positioning is the point where you first begin to ‘brand’ your company in the eyes of the customer/public.
Challenge with this Approach for Small Business
The challenge I see is that commissioning a study to ’sample’ a group by a third party is not cheap. It would run thousands of dollars. The question is what is a small business owner to do if they do not have the money?
Go Slow, Pay as You Go = Testing, Lots of Testing
In absence of a budget to retain a third party to do a blind test, you could over a period of time do your own study/survey. The trap is that it would not have the protection and safety of a blind test.
To be safe, you would do your study over a period of time, using different people to do the survey. Remember, our goal is to get a representative sampling from the ’survey’ using a wide variety of potential customers/prospects.
Do Not Jump the Gun
Be patient, the trap is once you start to get feedback and it conforms what you believe to be true - you start spending money to position your brand.
Wait.
Do more testing. This time do a limited, live marketing/advertising test to see how the customer responds. Then follow up with further live interviews to gauge the customers’ perceptions. Then use that data to compare to your positioning goals. The last checkpoint is, “Are there enough customers in that segment to make an investment in positioning profitable?”
Hopefully, Jennifer notices this post and comments on my ideas.
How Can I Convince A Bank Or VC To Invest In My Company?
December 13, 2005
Truth is you cannot convince any investor, bank or VC to provide financing for any business that is not viable or ill conceived.
Here is my own list of what to do to get the attention of a VC:
- Format: At the early stage some VC’s will prefer to see a PowerPoint presentation. Some are accepting proposals via a audio file and if interested they will get back to you.
- Connect the dots: Make sure you clearly state in the beginning WHO the customers are, WHAT problem is being solved, and HOW the company???s product/service accomplishes it.
- Meeting: If you are meeting with them face-to-face do not let empty air dominate the conversation. Make sure you control the timing and pace of the meeting.
- Research the VC: do some research in advance. Find out who you will be meeting with and make sure they invest in your type of companies
- Follow up: Do not be timid about following up with them.
- Push for a Decision: They will want some time to think about your proposal and you will not get an immediate decision.
- Be Real: Do not pretend to be something you aren???t. Be real, be you, be authentic.
Final Thoughts
You must have confidence in your business idea and have a well thought out business model and plan. If you focus on innovation and the viability of your business model, serious investors will want to take a good look at it.
Every major decision — to invest or buy involves getting the other party to buy into your idea. To get that strong emotional buy in - you must first get their attention. This involves spending a significant amount of time preparing and thinking through what makes your business idea special, unique and viable.
If you cannot explain it clearly — how in the world can you expect someone else to understand it?! How can you expect them to invest in your idea if they do not understand it?!
Spend your time working on your pitch to get their attention. NOTE: be careful not to over inflate your business concept and viability. You must also have a good business plan that supports the statements you made trying to get their attention. Remember: a presentation that cannot stand under scrutiny will fail to get investment dollars.
After you get their attention — you have to be able to get them to understand the business idea and prove its viability. This will require a well written business plan to close the deal.
Another thing — you will need a good list of potential Investors or Venture Capital companies to pitch your idea to. Make sure you have enough good prospects so that you do not run out of prospects before you refine your business plan and presentation.
Keep smiling! If you have a viable idea, you will find money. It is just a matter of time and your ability to learn, shift and adjust.
Top Reasons to be CEO (it’s not what you think)
December 12, 2005
Via TimeThoughts I found this interesting report from Burson-Marsteller: “For those that do want the job, the top reasons for pursuing a CEO position were the opportunity for complex problem solving (56%), ability to have personal impact on the business (43%), the satisfaction of having their ideas implemented (36%), and the opportunity to help their company go from “good to great” (33%.)”
What is most interesting is that: “Generous compensation packages, perks, and prestige were some of the least compelling reasons cited.”
How Can a Business Owner or Entrepreneur Maintain Balance?
December 12, 2005
Anyone who has been in business for awhile knows that the line between passion and obsession is a fine line. For entrepreneurs balance equals managing obsessions and compulsions. Building a business can be intoxicating, compelling and consuming. Successful business owners are often consumed by a set of values that drive them — which become consuming compulsions and obsessive behavior.
Balance = managing your obsessions and compulsions.
To have any hope of a normal life requires managing your drive and being realistic in your expectations of yourself and others.
The dictionary says that the definition of manage is to control, conduct, handle and it direct a business.
Failure, Base Hits, Home Runs or Grand Slams?
December 10, 2005
I think business success is a lot like playing sports. Anyone who has been successful in sports or business has worked hard for it. They paid a price — time, energy and money. Oh, and failure.
Every business person dreams of winning big or cashing out someday! The path to business success is quite simple — it just takes a lot of hard work. Here are the ingredients I think make up business success:
1) Master The Fundamentals: every game has a set of rules. In business certain traits and characteristics are essential. Learn to play the game. In many ways your customers, suppliers and employees are playing a very different game. One thing does remain constant — they are more interested in themselves than they are interested in you.
Learn how they play the game. decide if the rules fit into your own value system. If so, learn the fundamentals — communication, selling yourself and how to create value for them.
2) Learn The Rules: every game or business has rules. Pay attention to the way business is done. Study, read and ask lots of questions. Everybody has rules. Maybe they call them something else — beliefs, policies and procedures.
Look for an opportunity within these rules where you can help them — an area where you shine. This is your strategic competitive advantage — for that specific person. Use it with integrity, passion and commitment. These are very powerful tools to influence and gain trust.
3) Practice: test, try and learn. Practice does not make perfect — it makes permanent. You have to put in the time — the more you do something the better you get at it.
I remember my two year old Son doing a button or zipper for the first time. It seemed to take ages! His concentration was so intense and seemed so difficult the first time. He finally got it figured out — after five minutes. Today he has those skills mastered. As children we had a strong hunger and huge capacity for growth. I still think that same drive is within us — it is just hidden amongst a lifetime of experience.
The ability to learn and know when I have to change my ways is one of the most important success indicators I have observed — both in my own life and that of my clients.
It is knowing when — I am ready to play the game — when I should get help or training — or when to call it quits.
4) Prepare: make sure that you have all your tools and game gear ready. When you go out to play baseball — remember your glove, ball and bat. It surprises me how often people go to a meeting, presentation or networking function un-prepared.
I suggest that you spend at least an equal amount of time preparing for a meeting or presentation as you do in the actual meeting itself. It cannot hurt — it only helps! For example, if you are making a sales presentation — take your contract ready for signature. You will be surprised how much that will improve your sales closing ratio.
5) Playing The Game: in order to get to the last inning, bases loaded in the world series takes a lot of base hits, home runs and a few out of the park grand slams.
Failure is Your Friend if You Learn From It
You may even loose a few games on the road to winning the pennant. I heard someone comment once that Babe Ruth held the records for the most home runs and strike outs.
Think about it. What is the difference between a batting average of .375 vs. .275 — only one extra hit out of ten! Such a small margin of error that makes such a huge difference in the pay day! Simply, it means the difference between making a million dollars a year to making several million!
Remember, trying to avoid making mistakes or failure is not the key to succeeding in business — rather make lots of mistakes — just make sure you are learning and growing as a result! Do this and you cannot help but improve and eventually you will succeed.
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Getting the Price Right
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