Want to know how to come up with the really “big” ideas? Take a look around you.
Entrepreneurs think about strategy twice a year: in January and July. Don’t believe me? When I trawl through the stories that entrepreneurs read on SmartCompany I notice there is a real spike in those two months around a series of topics: innovation, assessing opportunities, building for growth and sustainable profits.
And it makes sense. That’s when a lot of entrepreneurs take holidays. I don’t know about you but after two days of total relaxation, I’m done. And visiting emerging countries is so stimulating that by day three, I’m up early and out on the balcony with the hotel paper and dodgy pen, drawing, thinking, strategising and reading for inspiration.
So there I was, sitting on the beach with my iPad.
I wondered how to think big. Really big. How do you come up with the really big future opportunities? Beyond day-to-day innovation? Bigger than just a new widget, a new way of working or using technology to deliver an existing product in a new way. Beyond all that.
What I wanted to know was how do we stretch our imagination and find the opportunities that Peter Drucker calls the”visible, but not seen”? How do we look into the future and peer beyond the risks and see the mega opportunities and trends?
The answer? By looking at the big problems changing society.
There is a good checklist in Harvard Business Review that acts as a great starter; a way to push my brain beyond the obvious.
1. Is the problem widely recognised? That’s a good one. There is no use coming up with a solution that can only benefit a handful of clients.
2. Does it affect other industries? Can you role the solution out using economies of scale and through your existing sales force?
3. Are radical innovations needed to tackle the problem? Well, if a Band-Aid will do, forget it. You need a solution that can build barriers to entry.
4. Can tackling it change the industry’s economics? Disruptive change is going to play into your hands by keeping your competitors busy.
5. Will addressing this issue give us a fresh source of competitive advantage?
6. Would tackling this problem create a big opportunity for us?
The author of the HBR piece, C.K. Prahalad, who was a professor of strategy at the University of Michigan, gives us some examples.
His first is “inclusive development” which he says are those mega opportunities that arise when one group wants to join another. How about this example? Four billion people on three continents are trying to join the organised economy. In response, smart companies are creating inexpensive products and services such as $2,000 cars, $100 laptops, $20 hotel rooms and mobile calls at $0.002 per minute. Now don’t just think of the obvious: that products and services are at risk in Australia from the relentless downward pressure on price. Think of the opportunities.
Prahalad’s second point to consider is the sheer size of any new market – think connectivity with the NBN and massive uptake of mobile phones. With five billion people using mobiles phones by 2015 and connectivity transforming industries, there is a spate of mobile applications in development. This will transform a wide range of industries, including media, medicine, retail, education and finance. Any opportunities here? How can we use connectivity as an enabler of new business models? How do we look beyond the threats to see how we could grow?
His third thing to consider are market movers. So let’s take “inclusive development” which is in effect our four billion people trying to better themselves. Add connectivity and I reckon that we are looking at a seismic shift. But wait. Add to that the third factor – Prahalad makes the point that the industrial system that has served 1.5 billion of us well for a century or two is adding on four billion new consumers and producers that will create unsustainable pressures. Those of us with less imagination keep treating sustainability as a problem, a tax, a cost and a burden. But again, try to turn your mind to the opportunities and start thinking.
So at the end of my holiday I had a tan, some new art and several ideas. I vowed to set up a connectivity work party. I decided we had been taking a very pedestrian approach to mobile and that I needed to get my people rethinking our opportunities. I also decided we needed to explore for our readers the mega changes and opportunities, so expect some great features coming your way. Thirdly, I began to think about new publications that the new world may need.
All in all, a successful holiday. Can’t wait until January.