Your customer value proposition (CVP) is what makes customers choose you instead of the competition – CVP is the foundation of your competitive advantage. Your customers compare your CVP with that of your competitors before they decide either in your favour or against you. Writing your CVP requires you to understand operations, marketing, as also strategy. You can offer value to your customers in several ways – monetary savings through offers and discounts, prompt deliveries, quicker attention to their complaints and suggestions, superior after-sales services, and providing certain specific conveniences like free home deliveries and others. You can discover many creative and innovative ways to bring value to your customers. Keep your CVP short and uncluttered. Be precise. Your customers have specific needs; your value proposition should offer targeted solutions. And finally, it is about your customer, not you. Your value proposition should discuss only what matters to your customers and not you.
Here’s what Micheal LeBoeuf,an American business author and management professor, has to say:
WHAT DO YOU THINK?
Let me know in the comments section.
In this ongoing series #GreatMinds on my blog, I am shining a spotlight on the important ideas that some very successful people keep talking about in their public life.
By a start-up, we generally mean an enterprise or an entrepreneurial venture in the early stages of its development. Such ventures are promoted by a single or by two or more founders together who focus on exploiting a perceived market demand by developing a viable product, service, or platform.
Let me quote here a popular definition of a start-up from Eric Ries, an American author known for his book, “The Lean Startup”:
“A start-up is a human institution designed to create a new product or service under conditions of extreme uncertainty.”
Eric Ries
During the early stages, start-ups are usually self-funded by members of the founding team — though many entrepreneurs either resort to bootstrapping or secure funding through an investor or take out a loan from a bank or development financial institution (DFI) to help fund their venture.
A start-up is like prototyping a concept – it creates something new or novel.
The difference between a small business and a start-up!
Let us understand one important thing here, whereas small businesses may be happy staying small businesses forever – a start-up does not want to remain small all the time. Most start-up companies generally have a bubbling desire to scale up their businesses and grow – and more importantly, grow fast – deploying technology to do so.
A start-up means continuously identifying and solving problems – one after another.
A start-up journey is all about enthusiasm to push your limits and do a lot of experimentation. When you are managing your start-up – you have so many questions about your business model and its long-term sustainability. You want to know and understand about your customers, employees, suppliers, and others in your immediate and remote external environment.
As a start-up entrepreneur, you must always strive for that ideal or the best possible product/market fit. This will involve trying to identify your ideal customers, which products and services those ideal customers purchase, at what price points, and how frequently they make those purchases. Paying attention to the core metrics like average customer lifetime value (LTV), cost of customer acquisition (COCA), and average sales cycle length is also important to many start-up entrepreneurs.
A start-up company should also identify those unmet needs or gaps in the relevant market space that the entrepreneur can fill.
A start-up can also try to change the ways things are traditionally done. This will call for a resource-based approach on the part of the entrepreneur – where the entrepreneur develops a new product or service from the resources and competencies available to them within the enterprise and then educates the customers to try these new offerings. Customer education coupled with adequate promotion and advertising will form an integral part of this strategy.
Let us be very clear about one thing – a start-up refers to starting from scratch. If you have already nailed your product-market fit and started making some money (revenue) – then you are not a start-up. A start-up is any business venture that is starting from scratch (earning zero revenue) and trying to build something of value.
A start-up is a group of people who bring about disruptive changes in the world.
Businesses can be considered to be in the start-up phase, “from zero revenue until they have found the best product-market fit, a valid business model, and replicable revenue generation strategies. Once those criteria are met, the business is no longer a start-up and instead moves to the scaling phase.”
What are some traits associated with start-ups?
Start-up implies a phase of the company where success is not yet determined. A team defines what a start-up is. A start-up is the largest group of rebels, rule-breakers, and unconventional thinkers that you can find, convince and inspire to create breakthrough change in the world. They are crazy. They view the world from a different angle and are not afraid to fail.
The focus of any start-up is on continuously testing, iterating, and learning.
A start-up is also characterized as a mix of emotions – start-up embodies these intense emotions of fear, nervousness, anxiety, and uncertainty. It is that peculiar feeling in your stomach that aches before you ride a rollercoaster or the nerves that flood your body before meeting someone new on a date!
A start-up is lean and adaptive. A start-up is a company that may not always have so many employees – it is an organization where individuals are working together towards a common goal, and that goal is usually highly innovative. They are heavily defined by their actions and execution, not just their ideas. It is mostly young, ambitious with a growing number of people with momentum around an idea or innovation.
In conclusion, I’d like to add that one should not mistake a start-up to be any company with a ping pong table, cool office decor, employee outings, loose regulations, and/or casual behaviour. A start-up is about actionable innovations around ideas!
In my upcoming post next week, I will be elaborating about the common problems that start-ups face like raising capital, failure of business model, poor human resource management and more… Obviously, I will also write about strategies an entrepreneur can deploy to mitigate such situations.
STAY TUNED FOR NEXT WEEK’S POST!
REFERENCES:
McGowan, Emma. “What Is a Startup Company, Anyway?” Startups.Com, 1 Mar. 2018, www.startups.com/library/expert-advice/what-is-a-startup-company.
Ries, Eric. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. Crown Business, 2011.
As an educator, I have been connecting to so many students and teaching them so many concepts. Then to check whether they have understood the concept well – I quiz them or ask for their feedback. Their answers help me gauge if my students have truly understood what I have just taught them. Whenever I spot a student who is unsure of a complicated concept, I urge the class to “explain it to me like I’m a five-year-old.”
I have always had this belief that if you can explain a concept to your grandparents or a young child in simple terms, it demonstrates your understanding. If you can break down a complicated idea with analogies relevant to your life, it shows that you have grasped it well. I have been using this technique for the last few years, imagining that it was my innovative teaching strategy; until I stumbled upon a quote from Einstein! (Haha!)
[There are various versions of this quote that are attributed to him.]
Here’s what Albert Einstein,the greatest physicists of all time, has to say:
WHAT DO YOU THINK?
Let me know in the comments section.
In this ongoing series #GreatMinds on my blog, I am shining a spotlight on the important ideas that some very successful people keep talking about in their public life.
It is the capability of collective thinking of the team that decides its performance and success in the long run. It is the job of the manager/leader to strive to achieve a positive atmosphere, free from rigidity and envy, personal aggrandizement, in which people compete with ideas — not egos. The manager needs to instil camaraderie in the team, where it is clear that the group and its goals take precedence over the prominence of any member.
Here’s what Henry Ford,an American industrialist and the founder of the Ford Motor Company, has to say:
WHAT DO YOU THINK?
Let me know in the comments section.
In this ongoing series #GreatMinds on my blog, I am shining a spotlight on the important ideas that some very successful people keep talking about in their public life.
As a professor of management, I have quite often been preaching my students on the importance of Emotional Intelligence (EI) in their communications and acts of behaviour with others in the family and at the workplace. To reiterate the importance of EI for the people in general walk of life as also for people working in commercial and other organizations, I have included an excerpt about the concept here. Read the importance of EI in the Exhibit-1 below:
EXHIBIT 1:
“Emotional Intelligence (EI) refers to the ability to identify and regulate our own emotions, to recognize the emotions of other people and feel empathy toward them, and to use these abilities to communicate effectively and build healthy, productive relationships with others. EI is most often understood as the ability to perceive, use, understand, manage, and handle emotions.
People with high emotional intelligence can identify their own emotions and those of others, use emotional information to guide thinking and behaviour, differentiate between different feelings and label them appropriately, and adjust emotions to adapt to situations. There are three components of emotional intelligence – first: perceiving emotions accurately; second: reasoning with emotions (means using emotions to promote thinking and cognitive activity), and the third: understanding emotions (the emotions that we perceive can carry a wide variety of meanings).
Although the term first appeared in 1964, it gained popularity in the 1995 best-selling book Emotional Intelligence, written by science journalist Daniel Goleman. Goleman defined EI as the array of skills and characteristics that drive leadership performance. In this book, Goleman posits that emotional intelligence is as important as IQ for success, including in academic, professional, social, and interpersonal aspects of one’s life. Goleman says that emotional intelligence is a skill that can be taught and cultivated.”
Regulating one’s emotions is a skill that can be learned.
The other day, I received a WhatsApp forward from a close friend, colleague and professor – Sudarshan Srinivasan. This forwarded message narrated an impactful story on the importance of EI in dealing with people in our day-to-day life. Please read the story in Exhibit-2 below, and then decide for yourself as to how can you improve upon your reactions, responses, and behaviour with others in your day-to-day life – be it your home, workplace, or somewhere else.
EXHIBIT 2:
“Do we need stickers on people to be kind to them?“
A car ahead was moving like a turtle and not giving me the way despite my continuous honking! I was on brink of losing my cool when I noticed the small sticker on the car’s rear!
“Physically challenged; Please be patient.”
Reading that label changed everything. I immediately went calm & slowed down! I even got a little protective of the car & the driver!
I reached home a few minutes late, but it was ok! And then it struck me.
Would I have been patient if there was no sticker? Why do we need stickers to be patient with people!? Will we be more patient & kind with others if people had labels pasted on their foreheads?
Labels like —
“Lost my job” ,
“Fighting cancer”,
“Going through a bad divorce”,
“Suffering Emotional abuse”,
“Lost a loved one”,
“Feeling worthless”,
“Financially broken”,
….and more like these!!
Everyone is fighting a battle we know nothing about. The least we can do is to be patient, kind & compassionate.
We know that every one of us is carrying multiple ones and powering through our day. So, let us respect these “Invisible Labels”!
After reading this, reflect on your actions and their impact on people around you. EI is not just important for your interactions in the workplace, but also your relationships in your personal life. I would go as far as to say that Emotional Intelligence and Empathy play a bigger factor in your success than IQ.
When we cannot attain or reach a desired outcome or situation – we are encountered with an emotion – called frustration. We get frustrated when we are blocked (or prevented) from reaching a desired goal or ambition. Whenever we accomplish a goal, we feel happy or enjoy that feeling of achieving something. On the contrary, when we miss a target or are prevented from reaching the desired end – we may surrender to frustration and thus, feel annoyed or depressed.
Frustrating situations, that cause resentment, or lead to a feeling of resignation, can have a destructive effect. However, frustration should not always be looked at as a negative emotion. Frustration often can be a motivator too! Since it can draw our attention to problems in our lives and compel us to look at strategies to bring about a change.
Here’s what T F Hodge,an American author, has to say:
WHAT DO YOU THINK?
Let me know in the comments section.
In this ongoing series #GreatMinds on my blog, I am shining a spotlight on the important ideas that some very successful people keep talking about in their public life.
What are the types of resources you need to round up for your venture?
You are an entrepreneur managing a start-up or an organisation to navigate it in the direction of sustained profitability and growth. To accomplish the mission of your organization – you will require various physical, financial, human, informational, and other types of resources. Resource Mobilization in a broader sense will mean garnering various types of supports from friends, family, stakeholders in business, your own employees, support infrastructure as also identifying, locating, and procuring certain scarce resources that are essential for your business. Resources can include many things including but not limited to money alone.
The Basic need: Physical Resources
Physical resources may include land, buildings, plant, machinery & equipments, your workspace, working telephone lines, information systems, furniture items, and other material inventories. Mobilizing physical resources may involve lot of funds and therefore you must exercise caution before committing funds for this section. Many new entrepreneurs are known to have initiated their business ventures from their home, a cart or a stall, garage or a very small place initially.
True Value Creators: Human Resources
Human resources are the most important category of resources because all other resources are managed by people alone! Recruiting, selecting, and appointing competent manpower for your organization is therefore an extremely important resource mobilization activity. As an entrepreneur, you have to meticulously work to create an effective organizational structure. You must create a top layer of strategic managers, a middle management layer of tactical managers, and finally a lower management layer of operational executives, supervisors, and frontline workers. Apart from this, you also must identify a suitable professionals who can work as advisors and experts (like chartered accountants, legal experts, and other functional consultants) for your business.
Staying Updated: Informational Resources
Mobilizing and managing necessary information is also very important for any modern business enterprise. It may include knowledge and information related to technical know-how, manufacturing processes, plant layouts, design inputs and details relating to technology transfer and absorption. Various Standard Operating Procedures (SOPs), Service Level Agreements (SLAs) and several standardized formats for a host of organizational functions may also fall in this category.
The Inescapable: Financial Resources
Funding is the most important aspect for any start-up or business. An entrepreneur can raise funds from his/her parents, spouse, other family members, relatives, friends, and associates including his/her major suppliers and other stakeholders in business. These are the persons who can directly contribute to the equity share capital of the firm/company and/or provide unsecured loans (quasi equity) to help the entrepreneur in his/her efforts to build the required level of equity.
Having raised necessary equity, the entrepreneur can always approach a development financial institution (DFI) or some bank or term lending institution for raising necessary term loan for financing the fixed assets.
For supporting the normal day to day operations of business, the entrepreneur can always approach any commercial bank and negotiate a suitable cash credit limit (working capital) for financing of the current assets.
As an entrepreneur – you can also approach several other resources to meet your funding needs – such sources include private investors, private equity firms, venture capital funding, angel investors, and grants and subsidies from the Government. You can always get details about these sources of funding from the internet and other places. It is however important that you review your specific circumstances before you decide on any of these options.
There are differrent methods to acquire financial resources
Venture funding is not suitable for all entrepreneurs. Venture capitalists are looking for high technology proposals with high-growth potential in sectors like information technology, communications, and biotechnology. Venture capitalists take an equity position in the company to help it carry out a promising but higher risk project. This involves giving up some ownership or equity in your business to an external party.
Angels are high net worth individuals or senior executives who invest directly in small firms owned by others. They are often specialists in their own field who not only contribute their experience and network of contacts but also their technical and/or management knowledge. In turn for risking their money, they reserve the right to supervise the company’s management practices. In concrete terms, this often involves a seat on the board of directors and an assurance of transparency. Angels tend to keep a low profile.
You may also take benefit of various grants and subsidies provided to entrepreneurs by the Government. The Government announces such grants and subsidies to start-ups and businesses from time to time. The purpose of these grants and subsidies is to help you meet expenses towards research and development, marketing, salaries, equipment, and productivity improvement. A grant is a sum of money conditionally given to your business that you do not have to repay. However, you are bound legally to use it under the terms of the grant, or otherwise you may be asked to repay it.
The Replenishment: Educational Resources
The greatest thing that an entrepreneur can do when establishing a new business is to gain as much education as possible. By understanding his/her competition and gaining an in-depth knowledge of his/her industry, he/she will be better prepared to make smarter decisions regarding the direction of his/her firm. Educational resources can be found through professional trade associations, local chambers of commerce, and other professional forums.
Connecting with Stakeholders: Relational Resources
These consist of aspects like customer relationships, supplier relationships, trademarks and trade names, which have value only by virtue of customer relationships, licenses, and franchises. The value of the relationships a business maintains with its customers and suppliers is also referred as goodwill, but often poorly booked in corporate accounts, because of accounting rules. HIPOs, as they are called, high potential employees are the ones who have exceptional potential, ability, and aspiration for successive leadership positions.
Not only customers, but supplier relations are also important.
How does one begin to accomplish this?
As a smart entrepreneur – you must work out a comprehensive plan/strategy for resources mobilization. You must ensure that all necessary inputs for operations are available at the workplace as and when you require these.
Apart from the major plant, machinery and equipment items, other inputs like raw materials, packaging materials, maintenance materials, various tools and measuring instruments and a host of informational inputs like drawings, blueprints, standard operating procedures, and others will be necessary.
All such inputs must be procured in right quantity, right quality, at the right place, and at right time. It is also necessary that we make right use of acquired resources thus ensuring optimum utilization of the same.
Proper supplier data base should be created, and suppliers should be evaluated based on pre-determined criteria (decided based on the consensus reached in a multi-disciplinary meeting of executives). This will ensure that we procure our production inputs from reputed, resourceful, and tested suppliers with whom we have established relationships.
Notwithstanding the fact that we are dealing with known suppliers, we must obtain competitive bids from interested suppliers and base our purchase decision on a pre-determined decision matrix. This will make sure that we are not paying unreasonable prices to the selected suppliers.
We should also do hard negotiation with suppliers to get reasonable (and at times favourable) terms on obtaining suitable warrantees, guarantees, free spares, after sales service, and/or several other facilities which may be specific to our case.
Before I sign off — things you must remember!
Resource mobilization efforts should align with your organizational mission, objectives, and strategic plan.
Resource mobilization is also about the needs of your (prospective) funder, and your clients.
Resource mobilization is often wrongly considered as fundraising. In fact, fundraising is a component of the resource mobilization.
Your strategic plan is the anchor of your resource mobilization strategy – in which your organization’s programs, structure and systems, as well as financials are reviewed, and new business opportunities are identified.
Successful resource mobilization requires a lot of work and takes a lot of time.
If your organization needs additional revenue one year from now, start today!
Your organizational performance today impacts your ability to generate resources tomorrow.
You must establish and maintain organizational credibility and reputation.
References:
H, Mayuri. “Mobilising Resources for Startups: Types, Problems and Solution | Entrepreneurship | Business.” Essays, Research Papers and Articles on Business Management, 4 Sept. 2018, www.businessmanagementideas.com/startups/mobilising-resources-for-startups-types-problems-and-solution-entrepreneurship-business/18188.
Seltzer, Judith B. “What Is Resource Mobilization and Why Is It so Important?” HC3, 20 Oct. 2014, www.healthcommcapacity.org/resource-mobilization-important.
The grapevine (or the corporate gossip) is the informal communications channel within an organization that is entirely different as also much faster than the firm’s or company’s formal communication channel. The formal communication channel within an organization generally flows in the same direction as the organization’s scaler chain. However, it is not so with the grapevine channel – which can flow in random order – in any direction – horizontally, vertically, diagonally, or in any other manner within and across the organizational structure.
Juniors may pass on information to their superiors, an executive may share a small piece of information to a worker in the packaging section, or employees in different sections and departments may relay or share snippets or titbits. Grapevine information may have a wider coverage with a range of subjects concerning and involving policies announced by the top management, workers compensation, trade union matters, CSR related decisions, and even matters related to a cricket match or a recent Bollywood blockbuster – virtually anything of interest to members of the organization. The information may be highly accurate or totally distorted – and/or it may or may not be of interest to all.
Here’s what Lawrence G Lovasik,an American author and missionary, has to say:
WHAT DO YOU THINK?
Let me know in the comments section.
In this ongoing series #GreatMinds on my blog, I am shining a spotlight on the important ideas that some very successful people keep talking about in their public life.
To be an intrapreneur means to work as an entrepreneur with someone else’s money! It means you do the work without taking any financial risk. For example, a middle-aged executive working in a large corporate can be assigned an independent project or an operational unit as its whole-time director or in-charge. The company will offer an attractive salary to him, or commission on sales. He may receive some fringe benefits or some share in the profits of the company. It is not uncommon to offer equity shares of the company to such intrapreneurs (either free or at a price lower than the face value of the share) to make them feel that they are the owners of a small part of the company.
Here’s what Oliver DeMille,an American educator, public speaker and the founder of an educational model known as TJEd, has to say:
WHAT DO YOU THINK?
Let me know in the comments section.
In this ongoing series #GreatMinds on my blog, I am shining a spotlight on the important ideas that some very successful people keep talking about in their public life.
This is a new segment on my blog called #StoryoftheMonth. The idea is to bring forward short stories, fables, and anecdotes, that have a moral or insight for the delight of my readers! So, make sure you look out for these stories once every month!
The following story was contributed by my colleague, friend, and a reader of the blog: Professor Sudarshan Srinivasan. It is a thought-provoking one on “Individual Growth”. This is his second contribution to the blog.
This is a widely-shared short story called “Law of Life”.
Once, a newspaper reporter had interviewed a farmer who produced a great yield year after year. He was known for his Award-Winning Maize by the Agriculture Show organized in his province. During the interview, the farmer revealed that he had been sharing his seed with his neighbours too.
Perplexed, the reporter asked, “How can you afford to share your best seed with your neighbours when they are entering their maize in competition with yours each year?”
The farmer smiled knowingly and explained, “The wind picks up pollen from the ripening maize and swirls it from field to field. If my neighbours grow inferior maize, Cross-Pollination will steadily degrade the quality of my maize.
If I am to grow good maize, I must help my neighbours grow a good crop.”
This is such a profound metaphor, isn’t it? This learning can be applied to our lives. Those who want to live meaningfully and well must help enrich the lives of others.
The value of life is measured by the lives it touches. And those who choose to be happy must help others find happiness.
For the welfare of each is bound up in the welfare of all. Call it the power of collectivity. Call it a principle of success. Call it a law of life.
The fact remains — “None of us truly wins until we all win.”
Know this secret as you grow older!
MORAL:
“In life, when you help the people around you to be better, it transforms you too to become the best.”
Did you like the story? Let me know in the comment section.
