Whatever business you are in as entrepreneur, it’s vital to watch other industries to track and understand their successes as well as learn from their mistakes and failures.
Innovation, directly related to research & development decides the strategy and necessary adjustment of objectives. And by reading, watching and learning from others you can quickly adjust or even launch new services or products.
‘I will study and prepare, and someday my opportunity will come.’ Abraham Lincoln
Over the recent weeks I spoke to a number of people from a wide range of industries, no official interviews, as I feel often that results in subjective answers, when questions are directly related to job specific subjects. After having read about the innovative way way of integrating new business models into company operations, I wondered what really these models are and what is needed from my point of view to ensure that they are understood and implement correctly and finally deliver the result that is needed for a company to be successful.
In many industries, not the least mine, hospitality, the most traditional processes are still in place. With traditional processes I literally mean every department, the hierarchy, the communication channels, the innovation or lack thereof, the operations and so forth. I am one of those people who thinks constant change is not only fun but a need for an entrepreneur to be successful. With change I refer to internal change, like personnel or working process, as well as the actual product or service. In my book ‘A hotelier’s mind, setting strategy for the future’, I write about implementing change through innovation, and what aspects are needed to make that successful. In this article I would to give you some examples of some of the learnings over the last weeks, to inspire you to consider your current position or role and make sure you start thinking differently. These examples are both a negative as well as a positive experience leading a few very similar needs that will ensure success.
The first chat I had, was a few weeks ago with a man as young as myself, who has a key position in one of the largest and financially most successful banks in the Scandinavian countries. He gave me the main reasons of why he expects to be out of a job within the next 5 years.
- The banking industry has since the last financial crisis in 2008, been indoctrinated with rules & regulations, creating even lengthier approval process, reduced opportunity for implementation of new or existing actions and implementations.
- There is a lack of marketing in sense of attracting new markets
- There is no or lack of horizontal business expansion
- Innovation and research stays at the coffee machine
- Non value added steps have hardly or never been removed
- Staff are unwilling to change
- From the management there is mainly focus on costs and in particular staff costs
I will come back to the above 7 points, that probably are no surprise to you and that the banking industry is suffering you can see on all the banks that are disappearing from the high street, replaced by an app. Let me ask you something before I get to the next chat I had. Have you ever received a newsletter from your bank, which made you change a service? Have you ever been asked any questions by your bank, about your preferences? Do you feel you know your bank knows you? Have you ever felt a bank that is a cool institution. Have you ever felt any type of association with a brand in the banking industry? Do you feel the banks are controlling your money, yes your money? Do you think these questions should have been asked a long time before the bank crisis?
The entrepreneur I met was excited about attracting a second round of cash impulse into his application. I love the way he and his team had found a very complicated logistical challenge we all have to deal with, on a regular basis. I can’t tell you in detail about the app, as it is in development and pilot stage, however I can tell you about the opportunity they seized, and whether it will be successful or not I can’t tell you clearly. I believe in it however they need to give certain elements some thought.
- They found a gap in the market, and have put several element within a distribution process together through technology. This is great, but they have no idea about how to reach that exact market segment
- There is no differentiation between sales and marketing, leaving opportunity to contract to cover basic operational costs
- There is no expansion plan, other than starting in the Netherlands and bringing it out into other geographic areas.
- This will not be a sexy app, and there is no need for that, as this solves an existing issue for many, however there needs to be marketing strategy in place to ensure people will start referring and writing about this after launch.
- One of the largest opportunities I feel are to enter many affiliate opportunities.
In this case I spoke with a company that is a start up, developed by a number of entrepreneurs who have created a brilliant solution, but are lacking the marketing skill, one that an investor would be looking for and also an expansion plan to ensure long term marginal growth.
One last chat I had, was one that surprised and worried me most, and that was with a teacher at a business university. A university that has only at the beginning of of 2017, put a project team together that is looking at a different ‘unit’ type of education. One that I learned in 2001 with Six Sigma and one that my hotel consulting company Mocinno International applies already for over 10 years, namely making each department or unit for their own financial situation, with a marketing and development functionality as well as the operational roles. Some of the discussion points were as follows:
- Traditional education per subject does not invite to develop a skill of integrating or even understanding other business deliveries
- The education does not automatically include some form of communication skill
- At no point in the discussion the use of online came up as part of the ‘new’ education
- Up until now, May 2017 communication with students was mainly driven through class room education
- The university is neglecting the fact that a company like for example GE has already implemented unit management over twenty years ago.
Making the money, by continuing to asking 10 questions
So based on the above subjective answers can you find any opportunity for your business? To answer that, I am going to ask you questions, which you can and should review for your business to understand whether you have a healthy opportunity to expand and further develop your company or start up the right way.
- Do you have the right approval process for steps that need to be taken in every process? Are accountability and responsibility well defined to enable solid and rapid decision making in line with the company strategy?
- Is your target market well defined, and are you continuously looking to attract new target markets?
- Is your company ready to expand with new products or services at all times, to ensure existing products are not getting old and are you creating new market opportunity, and who is responsible?
- Are ideas collected a la Google style, in creative workshops, followed by an action and implementation plan?
- Do you continuously look at existing work process and remove non value added steps?
- Are you ensuring staff, partners and suppliers and of course customers are informed at all times and in the right order of a change to ensure excitement and buy in?
- Is your company focus balancing the focus on costs and revenues?
- Are you setting up or structuring your company the way it has always been done, and is there opportunity to change that, into for example unit management?
- Are you communicating change, new processes, expansion with use of the latest technology in time?
- Are you sure you have the right job descriptions and people in place, who buy into your company strategy, question process and are fully updated on communication and technological tools?
Naturally there are many more subjects, many more questions. But having an answer and strategy based on the above 10 questions, will set a clear path for increased revenues and marginal growth of profits.
There is no better time than to start before you start up, or when you are part of that banking team, or teaching students on how to create their future.
About the Author
Jeroen Gulickx is a well-traveled hospitality professional with two business degrees and a Black Belt in Six Sigma certification, and has extensive experience within the Hotel & Spa segment.
The main capabilities vary from streamlining cost and operational models, strategy yielding, business development, and marketing to digital marketing.
In 2006 he started Mocinno International, a hospitality consulting company that now has offices and representation in 7 countries in Europe, USA, Middle East, Asia and Russia.
The Mocinno International team is focused on delivering incremental revenues for Hotels, Spas and also develops and strategizes hotel suppliers, using mainly the Six Sigma methodology.
Mocinno International works with a network of highly experienced, energetic and innovative people, based in key locations. The team also leads Client or Mocinno originated projects or concepts.
In 2015 he founded Local Treasures Hotels & Resorts,which will launch 2017.
Jeroen shares his over 20 years of industry knowledge through this blog, or other social media, and speaks at travel, marketing, innovation or strategy related forums. He wrote ‘A Hotelier’s Mind, setting strategy for the future’ a book to inspire hoteliers!