Think Agile

How Smart Entrepreneurs Adapt in Order to Succeed

Taffy Williams

• Publisher: AMACOM
• Year: 2014
• eBook ISBN: 9780814434314
• Topic: Business
• Subtopic: Business Strategy
• Index: Business

In today's constantly changing business environment, the question is not if any unexpected obstacles will try to derail your promising company, but when will they rear their ugly heads. Your biggest investor bails on you, having been lured away to the next new sure thing instead. A similar product is unveiled by a more established company. A key employee jumps ship to work for a competitor. When these obstacles--yes, plural!--arrive, will you be able to shift strategies, products, and services on a time, if necessary? Unfortunately, many entrepreneurs lock themselves into one strategy, one product, one distribution method, and one way of thinking about their business. In doing so, they limit their potential and lower their chances of capitalizing on economic, industry, or market changes. Think Agile wants to help the entrepreneur both assess their level of flexibility and learn to be open-minded and option-oriented in key areas such as:• Funding sources• Launch timetables• Planning• Repurposing everything from products to people to names• And much moreFeaturing real-life case studies and invaluable tools, Think Agile is the indispensable guide every entrepreneur must have in order to self-evaluate and develop the undeniably essential skill of agility--the secret to surviving whatever tomorrow brings!

PART I

Understanding What You Need to Know Before Adopting an Agile Workstyle

Why should you be more flexible in your attitude and actions?

What are the advantages of an agile mindset?

Where are you on the agility continuum?

The book’s first three chapters address each of these questions. I examine why current trends and events compel entrepreneurs to be more open-minded and option-oriented in their approach to their businesses; what benefits accrue to small business owners who make the effort to become more agile; and where you currently are in terms of your agility, based on assessment tools I’ve developed.

Once you’ve gained this knowledge, you’ll be motivated and prepared to incorporate the entrepreneurial agility tools in the book’s next section.

CHAPTER 1

Agility in Turbulent Times

In the past, most successful entrepreneurs possessed a single-minded focus that served them well. Sometimes obstinate and other times obsessive, they drove toward their goals with unwavering commitment. This approach to business—effective in a time of relatively slow change, moderate complexity, and more local than global competition—helped them overcome obstacles and seize opportunities.

While entrepreneurs still benefit from being driven and single-minded, such a mindset can also be a major handicap in our current environment of great volatility and unpredictability. Technological breakthroughs, economic shifts, and other changes occur seemingly every week. There’s the adage Man plans, God laughs. Substitute entrepreneur for man and you understand why it’s no longer possible for entrepreneurs to lock unwaveringly onto a product, a marketing approach, a business plan, a funding mindset.

Agility is essential for entrepreneurial success. I’ll share two stories that demonstrate why this is so.

Though Steven Jobs was an extraordinary and unique business pioneer, he was also a classic entrepreneur in many senses. Early on, he was obsessed with creating the best possible personal computer, and his drive resulted in some remarkable products. But when he returned to Apple after years of exile, he recognized that things had changed. Plenty of people were still buying personal computers, but the market had topped out. He noticed the emerging mobile computing consumer segment, though, and was able to shift his thinking—and the direction of the company—to serve this market (among others). Jobs’s flexibility enabled Apple to dominate the space for several years.

Arsen Avakian founded Argo Tea, a retail tea seller, in 2003 and now is the head of a 27-store chain with $20 million in revenue. Initially, Avakian’s vision was to make Argo stores the tea equivalent of Starbucks. This hugely ambitious vision, however, did not fit with changing market and economic realities. It also didn’t jibe with Starbuck’s acquisition of tea retailer Teavana and the coffee company’s plan to open tea bars. So instead of trying to become a giant in the industry or do battle with one, Avakian shifted gears. In a September 9, 2013, article in the Chicago Tribune, he was quoted as saying that Argo wanted to be the “Apple of tea … where you will fall in love with the brand.” To that end, Argo has started a bottled-tea business in addition to their retail establishments.

Making these shifts sounds easier on paper than it is in reality. Entrepreneurs often fall in love with their business ideas, their visions for a business, and their theory of how to make their companies successful. To let go of something they love and believe in is difficult; to change it in any way seems disloyal, fickle, and even weak.

Yet letting go requires strength; it’s an acknowledgment of a new reality for an entrepreneur. Agility facilitates movement from the tried-and-true past to the changing present.

NOTHING STAYS THE SAME FOR LONG

It’s not just that the pace of change has been accelerating, but the types of changes are expanding as well. From the economy to technology to the global marketplace, everything is evolving at a fast clip. More than that, many of these changes aren’t predictable. Mobile technology, big data analytics, and social media may seem as if we should have seen them coming, but in fact only hindsight makes it appear that way. Ten years ago, when people used cell phones for traditional phone-to-phone communication, few would have predicted the widespread use of smart phones in ways that make phone conversations a secondary or tertiary function. And until the economic downturn of 2008, the majority of small businesses that required financing sought loans. Who could have predicted that these loans would become almost impossible for many startups to obtain?

In the face of these rapid and widespread changes, entrepreneurs have no choice but to be flexible. If entrepreneurs are unable to shift direction and find new sources of funding, or if they can’t reformulate their products when a Chinese company brings out a similar one at half the price, they’re out of luck. But before we look at what agility means and how it translates into specific business behaviors, let’s review some of the types of changes that make agility imperative:

Funding. It’s not just that banks have tightened their purse strings, but that venture capital firms have diminished in number; and those that remain are more selective about who they fund. We’ve seen the rise of angel investors—wealthy individuals or groups who fund ventures in exchange for a share of ownership. We’ve also witnessed the rise of what I refer to as “startups for sale”—cash-strapped entrepreneurs who launch companies on a shoestring with the hope of becoming acquired by a large company. In this way, they gain the finances and other resources necessary to grow their idea into a profitable enterprise; “startups for sale” has become the dream goal of many entrepreneurial Internet companies. And then there’s the crowdfunding movement—people who use the Internet to launch their ideas for new businesses and attract financial backing from individuals who see potential in that idea; Kickstarter is the most well-known example. We’ll focus on funding options that have arisen in recent years in Chapter 5, but as this brief description indicates, the environment is completely different from how it was as little as ten years ago.

Technological. New technologies impact entrepreneurs in every field in countless ways, and they require all types of adaptations. On the most basic level, technological innovations have caused entrepreneurs to change the way they conduct daily business. For instance, Texas Instruments introduced handheld calculators around 1967 and IBM introduced its first personal computer around 1981. In 1973, a scientist working for Motorola successfully made the first portable handset, and by 1987, over 1 million cell phones were in use in the United States. These devices are now part of our daily existence while the older technologies are phasing out. In the 1990s, the fax was the dominant mode of communication in business. Today, it is quickly going the way of the electric typewriter, as email and other Internet forms of communication have become dominant.

The social media demand that entrepreneurs rethink customer relationships; and information technology necessitates that competitors and potential competitors know about your product breakthrough almost immediately after you achieve it. Virtual meetings across continents routinely take place on Skype and other sites. New technologies are being introduced every day, and today’s smart phone will be tomorrow’s fax machine. Entrepreneurs who aren’t able to adjust their businesses to capitalize on these technological changes will be left behind.

Regulatory. The EPA, FDA, USDA, and SEC are just some U.S. agencies that have been active in altering their regulations in recent years—and aggressively pursuing those who fail to comply. Any small business that has grappled with the SEC regarding 2002’s Sarbanes-Oxley legislation is well aware of how regulatory changes require all sorts of new policies and procedures. Many times, agility is required just in terms of time and resources allocated to respond to those changes. In other instances, entrepreneurs may need to make major shifts in their business operations. New environmental regulations, especially, can create all sorts of issues for small companies: the material you’ve been planning to use to manufacture your product has just been ruled an environmental hazard, the FDA decides to create new nutrition regulations, or the Department of Energy places greater restrictions on nuclear energy creation and use.

Market-by-Market. Entire industries are being transformed through global, virtual, and other means. In the medical field, increased scrutiny by insurers is cutting into medical business revenues. The ability to reduce hospital re-admission rates and the shift toward personalized medicine are causing health-care professionals to alter the way they do business. Small medical practices have aligned with other groups to create larger medical practices in order to have greater clout with insurers. In other fields ranging from agribusiness to software to beverages to retailing, transformations are also taking place. While big corporations in these fields are affected, the entrepreneurs often are the ones who...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Contents
• Acknowledgments
• Introduction
• PART I: UNDERSTANDING WHAT YOU NEED TO KNOW BEFORE ADOPTING AN AGILE WORKSTYLE
• PART II: INCREASING YOUR AGILITY EXPONENTIALLY
• PART III: MONITORING AND TROUBLESHOOTING
• Index
• About the Author
• Free Sample Chapter from The Art of War for Small Business by Becky Sheetz-Runkle