Archives for the month of: June, 2012

When starting a business in the physical world, it is easy to grasp the criticality of “product first”. Wether someone is creating a new type of vacuum cleaner, garden hose or starting a restaurant with a specific cuisine in mind, people start of with a very specific product that meets some very specific unmet need in the market. However when the same logic is applied to products in the digital world, the response that you immediately get from a lot of people, particularly those inexperienced with launching a product in the digital world is: “hmmn, thats it? thats all the product will do? but you can do so much more, there are so many more bells and whistles that you can plug into the product”. The problem is compounded further when someone like myself, trained as a consultant that implements very large complex systems for very large companies, try’s to launch his or her first product. Invariably we always start with a grand world changing vision, and a complimentary product that does quite a lot from day one.

I remember when I first heard about a product that enabled people to easily unsubscribe from unwanted mailing lists that they may have signed up to consciously or unconsciously eons ago. My gut reaction to the product was that “its so basic, its not world changing, I can probably create a crude version of this product if I locked myself up in a room for a week”.

Product development in the digital space is so counter-intuitive that even an intelligent, experienced professional like myself was missing a key premise in my analysis. To create a great company, one has to start not with creating some average product with a million bells and whistles, but one product, perhaps even something that looks nothing more than a feature in the context of a larger more complex product, that does something better than anything else out there. This premise holds true wether it be Levi’s using copper rivets to to reinforces points of strain on a pant, or Google creating the page rank system. Great companies and great brands, generally start with one product that is exceptionally better than anything else in the marketplace, make themselves relevant, and then begin to expand their product suite. Hence, something that starts of as a very simple but exceptionally executed un-subscription product, and helps solves a major annoyance faced by consumers and business users alike, could be the first step towards a product that ultimately helps reduce all kinds of clutter, digital or physical, in peoples lives. So next time you see a product that looks like a feature, don’t assume that founder is not a visionary that can’t think big, but perhaps simply a more experienced entrepreneur than you.

(PS: A product in this context does not simply refer to a manufactured entity, it also equally well refers to a service being offered. Google search, Facebook social networking, consulting provided by McKinsey, or an exotic derivative created by Goldman Sachs are all services, but in each of these cases the service being offered is the companies product).

When I left consulting to focus on my venture full time, I figured that a lot of what I learnt as a consultant would be easily transferable to my life as an entrepreneur. While this is to some extent true, boy am I surprised by the amount of unlearning that I have had to do! Three things stand out when I look back at the key lessons learned:

1) Focus on getting the product out, vs. the perfect product out: In consulting, the focus is on getting as close to a perfect product out as you can the first time up. Running experiments, creating an MVP, and iterating (though it might actually make sense even in a consulting engagement, a separate post on this later!) is not done often enough. They are really not part of a consultant lexicon. The focus as a consultant is on producing the best possible client deliverable – which may be a powerpoint deck, a study, or a CRM system. While this pursuit of perfection is in itself a must have from the perspective of an entrepreneur, the focus in the early days needs to be on validating assumptions as fast as possible, and if that means putting together a quick and dirty prototype, or an A/B test that falls somewhat short of your perfect standards, then so be it.

2) Learning to embrace uncertainty, vs. attempting to eliminate uncertainty: By definition a venture involves a huge amount of uncertainty. Trying to mitigate every risk imaginable when working on a venture is akin to trying to mitigate every risk involved in making a movie. The best you can do is validate your biggest assumptions quickly, put together a great team, trust the team, and execute to the best of your abilities. Beyond that you simply have to acknowledge that starting a venture is risky business, and while you can get better as an entrepreneur with time, even the best entrepreneurs are not immune to failure. If this is not something that you can handle, then perhaps you should reconsider the entrepreneurial path.

3) Don’t be a consultant for too long: A lot of the most essential skills you need to be an entrepreneur you can learn very quickly – in the first 2-4 years of being a consultant. These skills include everything from effective time management, to presentation skills, to relationship development skills. In fact these are skills that you probably already have to have made into a top tier consulting firm, all you do as a consultant is put them to use consciously every day and make it second nature. However having done that you reach a point of diminishing returns, and every additional day you spend being a better consultant, is one less day you spend learning to be a better entrepreneur.

In summary, consulting can be a good training ground for someone with entreprenurial aspirations, just don’t remain a consultant for too long, and make sure you stop by you local B&N or place an order on Amazon for Eric Ries‘ “The Lean Startup” as part of your exit procedures!

This is in response to an article on Forbes by John Mancini. John’s basic premise is that Enterprise IT is too slow, too bloated and generally unable to keep pace with the changes brought about by Social, Mobile and the Cloud. While there is some truth to his argument, that large Enterprise IT departments are reluctant to cede control, the truth is a lot more complex than that.

Most IT organization today are focussed on keeping systems up and running, through various integration touch points, and a myriad of custom and packaged enterprise applications. Large organizations have upwards of a 1000 enterprise apps, integration touch points and their corresponding infrastructure to support. It’s easy to suggest that IT doesn’t get it, however remember that business professionals are not the only ones that use social media, mobile and cloud, in terms of personal use IT professionals are probably the earlier adopters of these technologies. However someone has to worry about keeping the monster running, and that thankless job falls on IT.

All this being said, the points being made in the article are still valid, i.e. IT needs to evolve from worrying about systems integration, to worrying about data (the “information” part of IT) and adding business value through the wealth of data and information processing capabilities being made available through social, mobile and the cloud. But the road to this, particularly for large organizations is littered with vested interests, legacy apps, band-aids put together to keep apps up and running, and over a decade spent by most companies chasing wage arbitrage opportunities in IT.