“All in Startup: Launching a New Idea When Everything is on the Line” by Diana Kander (John Wiley & Sons, $24.95).
Kander, a self-described “entreprenerd,” knows that startups don’t fail because of the founder’s lack of passion or money. Then why do over 75 percent fail? They put the customer at the end of their creative process. They spend time, and burn cash, building their idea into a product and branding it before they deal with the real question: “Will the customer buy it?”
Kander states, “People don’t buy products or services, they buy solutions to their problems.” That said, customers are often irrational and put wants in front of needs. They’re unpredictable, too — they bought Pet Rocks by the quarry full. Entrepreneurs can’t assume that customers will identify with their assessment of a problem that needs solving. Nor can they assume that someone is willing to pay money for their solution.
She sees successful entrepreneurs as detectives, not fortune tellers. They do market and product research. They test their assumptions (customers, pricing, distribution channel, etc.) as best they can before deciding whether to invest more time and more money. Doing so allows them to tweak their ideas and reduces risk of failure.
Kander incorporates her experience into a fictional story laced with entrepreneurial facts and myths. Readers will follow Owen Chase, an entrepreneur in the financial crosshairs, and Samantha, who becomes a mentor with a non-traditional approach to entrepreneurship and business growth.
The chapter titles cue the lessons to be learned. Some of the more important chapters are: “You can’t sell anything by doing all of the talking”; “Only the customer can tell you if you’ve found a problem worth solving”; “Luck is not a good strategy for poker or business — it’s the outcome of a good strategy”; “Don’t go all-in without confirming your assumptions through smaller bets.”
Kander’s message: The strength of your idea depends on the customer. When you finish the tale of Owen Chase, you’ll know how to ferret out what the customer finds relevant.
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“XLR8” by John P. Kotter (Harvard Business Review Press, $25).
Traditionally, organizational processes have been built around running what’s directly in front of them. Kotter maintains that ingrained processes can’t quickly respond to change and competitive threats, nor seize opportunity. He advocates a networking (people, not IT) system that operates in concert with the processes and procedures system. Why the dual system? People accelerate progress; processes and procedures impede it.
“The network side mimics successful enterprises in their entrepreneurial phase.” Because it’s not hamstrung by the bureaucracy of organizational charts, titles and job descriptions, it “liberates information” by fostering communication and initiating individualism and creativity.
It doesn’t create organizational anarchy because the networkers work within both systems; they know how the firm does business. Rather, it brings together “volunteers” at all levels to provide top-to-bottom perspectives of issues, alternatives and opportunities. When employees become agents of change, they “desire to work with others for an important and exciting shared purpose.” Siloes crumble. Leaders emerge.
The coalition of networking volunteers has a sense of urgency about the need to think and act on continuous improvement and capitalize on opportunities. To sustain urgency, celebrate all wins. These make even the most command-and-control manager take notice of the contribution facilitated by collaboration.
The processes involved in achieving wins become part of the organization’s core system of processes and procedures. The dual system institutionalizes change through evolution.
Kotter cautions management about hand-picking volunteers (i.e. those “with the right skill sets”). Why? Instead of focusing on what they have the most energy and passion for, they focus on task-specifics as identified and dictated by the hierarchy — and the benefit of the initiative network wanes.
Before reading the book, check out Kotter’s six-minute, mindset-changing video at kotterinternational.com/accelerate.
Jim Pawlak is a nationally syndicated book reviewer.