sift everything

Went for a run this morning and spent the entire time disgusted by all the garbage in the ditches.

Am sitting in my office now and just realized the leaves are out. Bright, shiny and green.

I chose the wrong thing to focus on. Perspective is everything.

David Weinberger posts his notes from presentations given by six teenagers from a sci/tech high school. They are talking about how they’re using their computers socially in the course of a day.

I’ve often thought of doing something similar to learn how kids sift info.

Below is a review of a new book by W. Chan Kim and Renée Mauborgne: Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant

I’ve got a question, when sharks come to your blue ocean, what then?

Do you find another ocean?

Or start building a Blue Ocean castle?

Just finished reading Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant by W. Chan Kim and Renée Mauborgne.

I enjoyed the book. One of the entrepreneurs I work with, the career coach, is already well ensconced in an largely uncontested blue ocean. And another, the graphic designer, is toe-to-toe with a million other designers in a highly contested red ocean. It’s fun to compare the strategies of each.

Overview

In one sentence: Get out of highly contested markets and unlock untapped potential.

By the author’s definition, Blue Oceans are uncontested markets. Red Oceans are the bloody waters on fully exploited, highly competitive markets.

The authors give a pretty good arguement for getting out of competition. Their process is simple and new insights come quick. The book is a great roadmap for finding alternative markets and building strategies to grab dreamy opportunities.

The good part of Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant by W. Chan Kim and Renée Mauborgne.

The best part of the book is their Strategy Canvas. That paradigm alone is worth the price (which is high and shows they haven’t even innovated on pricing). I’ll leave it to you to grab the book, I don’t want to steal their thunder, but it’s excellent.

Amongst the “metrics” there’s a great framework for identifying alternative markets. The authors provide choose-your-own-adventure quests:

- Look across alternative industries,
- Look across strategic groups within industries,
- Look across buyer groups,
- Look across complementary product and service offerings,
- Look across functional-emotional orientation, and
- Look across time.

They also stamp out a template for building a strategy once a chimeric opp has been spotted. Visual awakening, visual exploration, visual market fairs and visual communication are good methods for filling in the details of the plan (despite the bs names).

At a deeper level their six stages of buyer experiences and road blocks to purchase are super. And the grid they built to illustrate it is one of the few good tables they constructed.

Overall the book is great for spotting dream niches and finding ways to quickly take advantage of them. But a few questions were left unanswered.

Reviewing Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant by W. Chan Kim and Renée Mauborgne.

Here’s the bad:

The authors forget (or ignore) something fundamental to business — all great innovations are copied. A blue ocean today is quickly a red ocean tomorrow. And in thier blissful forgetfulness they feel justified and safe enough to toss off the precepts of hard-won, timeless principles of strategy.

Just because the book is about moving into uncontested space doesn’t mean that the principles of competition and contest don’t apply. In the Art of War, Sun Tzu lauded the good general who wins a battle before it is fought. But he puts on a pedestal the general who achieves military objectives without the enemy ever knowing a contest had begun. What Sun Tzu calls the “Sheathed Sword Strategy” is the old name for Blue Ocean Strategy.

Speaking of new names for old things — the authors do alot of renaming. Funky new words, tables and figures add little value when the principles aren’t clean. For some reason they think a few tables and innovative words are the same thing as adding metrics. They aren’t.

Finally, for a book about blue oceans and uncontested markets — is there another market more heavily contested than that of business books? What’s innovative about their strategy? A quick trip to their website shows there’s been very little innovation at all.

So much for the bad.

Great thought by Rob at Business Pundit.

Opportunity Science: in an age of increasing competitiveness, falling barriers to entry and ever increasing business opportunities, the advantage will lie with the companies that pick the best opportunities to pursue — and use science to do it.

“The advantage will lie with the companies that pick the best opportunities to pursue … and put more and more science behind this task … take the next step and [this could] become a discipline unto itself, complete with college majors and whole departments at major corporations.

“Think about how primitive our models for this kind of thing are today. We do a SWOT analysis and figure out ROI and then debate a little while. That’s it. Yet with increasing computer power, models borrowed from economics, biology, neuroscience, physics and sociology, opportunity scientists could potentially give structure, formalization, and predictive power to a field that now requires lots of “hunches.” Think about being able to estimate the “tipping point” of a new venture with a high degree of probability.”

“Initially, opportunity scientists will have to fight the same battle that psychologists have fought, that their field isn’t grounded enough in hard data. But as we begin to better understand and model the human mind and the way we interact in groups, the day may come when our business strategy for attacking new markets is heavily determined by an opportunity science computer program.”

Ok, I’m back.

During the break — in between changing diapers, burping babies and battling a wicked cold, I’ve been thinking about this blog. What’s it for? Who cares? What now?

I asked a few months ago who was reading this and why. That post is actually my sixth most popular of all time but it generated minimal response. I hope this one gets a bit more action.

I’ve badgered the entrepreneurs I work with to seek the advice of their clients more explicitly. I’d like to follow my own advice and ask those that read this blog what they value most about what they read. I’ve been delivering a fairly broad smorgasbord of topics here and I wonder if some focus is needed.

I write regularly on:

- innovation,
- insight,
- education,
- business book tid-bits,
- synthesis across disciplines,
- strategy,
- science, and
- economics.

Is the mix good? Too wide? Any gaps? Does this fill a need or is it sufficiently covered by other writers?

Of course I’m going to consider this some more on my own, but I’d love the advice of anyone willing to toss in a comment.

Slowly getting through the mind-numbing, sleepless days with a new baby.

So I’m starting to sniff around the net again finally. Today I found a manifesto calling for a Masters in Business Imagination.

The rhetoric’s not too hot but it does shout out the core reasons why me pursuing a relationship with Heliotrope is a good idea.

I’ll get back to regular broadcasting in a few days. Promise.

I got to stay with my wife through the entire sweaty 24-hour delivery of our boy (still no name). One of my favourite parts was the rhythm of her labour.

Near the beginning of the marathon her contractions were shallow and irregular. But she quickly got used to the feel of things and was able to go to sleep for a few hours.

By noon her contractions were serious – giant waves of pressure and pain. They pounded in with barely a minute between the end of one and the start of another. But she was amazing and beautiful and strong. We even went for a walk to help distract her.

At 6:00 we ripped off to the hospital. Her contractions were at the same pace but strong and more painful. She was getting a bit panicked and wanted to know if she was progressing. Meanwhile I’m rubbing her back, fiddling in her hair, stumbling around — trying to figure out how to help her.

From six until the end her labour changed very little. Crazy strong, incessant and sometimes even doubling or tripling up before a break.

I loved the entire process. It was so … real. So whole. And I thought that the long, ever-changing journey to his birth was a brilliant metaphor for all new things in life.

Now this might sound cheesy, but this morning I thought of three things things entrepreneurs can learn from labour.

First, remember the end result and focus on the next contraction.

As in labour it’s easy to forget why you are doing what you do. It gets hard and painful and too fast. Distracted by the chaos of the moment you can panic. And the only way to live through the chaos is to remember this will end and stay focused on the next contraction. In the case of labour, living through three-minute increments makes it possible to win the psychological game of body raking contractions.

In the same way, as an entrepreneur, living through the chaotic days of a start-up, the next three weeks or three months need to be the breadth of your foresight. Otherwise the game is too big and overwhelms you.

Second, what worked one-hour ago doesn’t work now. And what works now, won’t in another three hours.

Even though the end result is unchanging, the process is dynamic. Dealing with the pain is almost a strategic game. Find something that works, use it until the marginal pain gets too high, wait for a lapse, flip to another position and immediately find a new groove. So too in the birthing of businesses.

Many entrepreneurs plough along using the strategy that worked when they got started. They forget that the game is dynamic. Be vigilant. Watch the pieces that work and beware of those that begin to fail. Quickly jump to change those areas that start to lag behind.

Finally, while you focus on the short game you need someone to see the bigger picture.

Labour is nearly inhumane. It’s overwhelming, mind numbing, and nearly endless. While awash in the monumental pain of the moment it’s devastating to look at the immensity of what lies ahead. And core to making it through is having someone that watches both the moment and the long-game: She has six more hours and needs to rest now. She hasn’t dilated; she can’t push yet. The baby’s heart rate has been falling for two hours – we need to move quickly.

As an entrepreneur you must live in the moment. But you’ll do best if you can play strategically based on the bigger picture. And because most entrepreneurs can’t play both short and long games – you gain from the perspective of someone outside the moment.

Besides my new son I also work closely with three young companies. And now that I’ve been through the delivery of my baby I can see that, for these entrepreneurs, I’m basically a labour coach. A doula for start-ups.

Decided life wasn’t full enough and tacked another start-up on the portfolio. A baby boy.

Huge initial investment but the pay-back is immediate. Fortunately it’s a growth industry with lots of potential. And it’s something my wife and I can do together.

We’re still struggling with the name. Gavin or Otto?

So, while I adjust to the newness, the blogs will thin out a bit and the response to email will trickle slower than ever. You know — priorities.

For the step-by-step guide to pitching, use these links:

1+7 Steps to pitching an idea

13+ questions for pitchers

Put the pitch together

60-second pitch: The 10 point outline

60-second pitch: The first 10 seconds

60-second pitch: The three biggest mistakes

Presenting the bigger small picture

The overview

… I just recently did a self-constructed readings course on design and creativity. For help on reading suggestions I talked to Galen Cranz at Berkley and Sara Beckman, same place.

If you’re interested I could send you the reading list and links. Once you’re set up we could discuss it as you chug along.

Send me an email or post a comment. If there’s enough interest, maybe I could throw up a wiki (need to learn how anyway).

I love design, even if my vanilla background and black text don’t prove it. In grade five I discovered that Ms. Faulkner gave A’s for illustrated stories and B’s for the plain text version. By 13 I knew that ladies preferred a poem to shouted declarations of undying ardour. My early conviction that design was distinctive kept me following design even when I wandered off into the “real” things of life (like regression equations, Brownian motion, and sodding elasticities of substitution).

This month’s issue of Fast Company does a bang-up job of laying out the intersection of design and business.

In the article they chat with Roger Martin, dean of the University of Toronto’s Rotman School of Business. Martin’s short on the future of commoditity goods and services. China and India are going to pound to dust any company that tries competing on price and cost. He asserts that future prosperity depends on the ability of entrepreneurs to create “elegant, refined products and services.” Martin says, bottom line: “Businesspeople don’t just need to understand designers better — they need to become designers.”

Presently the core differentiator between business person and designer is imagination. Imagination is a juggernaut meta-human skill. You can get a computer running business simulations, cross-referrencing case studies but there are two key areas that remain the sole domain of humanity: cognitive synthesis and imagination. Imagination lets designers see problems and opportunities in the abstract where commodity builders see things in the linear progression of basic mathematics.

I’ve written before about Robert McKee, a screenwriting lecturer, who distills stories to their essence. Every great story maintains a sense of mystery and an element of imminent loss – a challenge. Martin agrees and believes innovators need to take hold of the mystery — the abstract challenge — and create a solution.

The trick is breaking up the problem so your imagination can engage. When you see a challenge you’ve faced before you immediately defer to old tactics. To be innovative you need to break up the line of numbers and analysis and bring back the mystery.

Martin says the key is a combination of inductive and deductive reasoning — abductive thinking. Abductive thinking is “suggesting that something may be and reaching out to explore it.” It’s like the hypothesis of the scientist or the suspicion of the detective — instead of acting on what’s certain, bet on what’s probable.

In the article Martin charges business schools to take a position in the design-based economy. He criticizes MBA’s for only producing linear thinkers when “the real challenge lies in getting better and better at a different thing: devising clever solutions to wickedly difficult problems.”

Martin, the Rotman School, the the Ontario College of Art & Design, the Illinois Institute of Technology’s Institute of Design, and Stanford University are building programs to combine analytical thinking with horizontal thinking — thinking based on intuition, experimentation, and empathy.

This is a great move but maybe MBA’s are the last places to do it. I’ve raved before about A.H. Maslow’s view on education and the need for a new kind of human. This is a move in the right direction but why try to teach adults to be creative after we’ve pounded it out of them in high-school? If we’d affirm the natural desire to innovate and create early we wouldn’t need to build new business schools.

Well, I do see the point. Who’s going to lead us while we try to fix the elementary school system? So, I’ve started working with two entrepreneurs in this area. First is Heliotrope which is dedicated to magination’s tremendous importance in our lives. And then a design and communication strategy group here in Ottawa (note their newsletter “SIFT” is not me or mine … but you can’t blame them really — it’s plainly a terrific name).

Having caught their attention with the 60-second pitch, you immediately followed with the 5-minute version and now you’re invited to do a full-blast presentation. How to?

Again, Bill Joss and Fast Company nail down next steps.

Before you get to “yes,” you have to give the “overview presentation.” This little show gives enough information to help listeners make the enlightened decision to engage your company without overloading them. If they’re interested, they’ll ask for more.

Pitching is an art but there is science to it too. And science tells us that one week after your pitch, your listener will remember only 10% of what you told them. This is pitch decay, and it’s a grim obstacle to any sale. You can highlight the 10% that matters most, or you can let them figure it out for themselves. You choose.

The reality of pitch decay underscores the need for brevity. So condense your message into a dozen slides — boil it down. Divide your presentation into chapters: summary, market, solution, team, and recap.

Summary

Start by saying, “If you only remember three things about our business, you should remember these …” Adapt your 60-second pitch, including your mission statement, business idea, and call to action. Don’t make it a secret. Tell them up front what you’re looking for.

Market

Lead with the problem and follow with the opportunity. Describe the need your business will meet. Back up your case with market research. The more granular and consumer-focused — the better it will be.

Business Plan

This is the solution part of the presentation.

- The Idea:

Sketch out your idea. Remember this is an overview. You may have to delve into details briefly, but don’t get caught up in them.

- The Technology:

Give a basic grasp of what you’re doing.

- The Competition:

Don’t dwell on the competition, but don’t leave out any major competitors out either.

- The Marketing Strategy:

Explain your leverage points. You can’t move the world alone. Where is the fulcrum?

- The Path to Profitability:

Explain how what you do helps those you serve make money. And know that everyone will care about your assumptions and your metrics, the pedals that make your business move faster. Tell them.

Your assumptions and your metrics help them gauge your logic. And your logic is more important at this stage than the results of your mathematical equations.

Team

Tell them about your team’s relevant experience. If you don’t have a complete team, say so.

Recap

Here’s where you tell them what you told them. Remember pitch decay: pull out the main points of your presentation, and restate them with a renewed call to action. You must cut it down to just a few key points — three is ideal.

Having slogged through the metaphysical and skidded through the practical we now need a middle-manager class pitch - the 5 minute version. Again, Bill Joss and an article in Fast Company provide the details.

The 5-minute pitch is all about laying out the nuances of your plan. Give the detail that is lacking in the 60-second version. Here Bill’s talking executive summary but it’s nearly the same thing as a 5-minute pitch.

Experienced horse-race bettors want to know three things about every race: the quality of the track, of the horse, and of the rider.

The Track

The marketplace is the racetrack. Bettors don’t want to view the racetrack from a blimp. They want to know whether the track is wet or dry, sandy or firm, slick or sticky. The same goes for investors interested in your marketplace. Don’t show them the view from Jupiter. The more grassroots market knowledge you can demonstrate, the better.

The Horse

A new business idea must act like a racehorse. It must be fast, fluid, and flexible enough to lead the field even in times of change. Investors want to see the reasoning behind your assumptions. The thinking that goes into a business plan is extremely valuable. Get the plan on paper — 60 pages, 80 pages, whatever it takes — then boil it down to 2.

The Jockey

The jockey is the team that steers a business idea to market. Smart bettors bet on jockeys. Human capital is simply harder to acquire than financial capital. The team is the most important part of you pitch — devote a significant amount of space to your jockey.

This is the last of three street-level bits of advice on pitch giving. Previously covered are 10 points for outlining your pitch and the first 10 seconds of the 60 second pitch. The three mistakes discussed today are just a part of a broader discussion in Entrepreneur.

In 60 seconds time, you must:

- say who you are;
- describe the salient features of your business plan;
- and get your listener excited about what you do, so that they want to hear more details.

“The three biggest mistakes people make in their pitches are: 1) describing skills rather than purpose; (2) failing to tell an interesting story; and (3) forgetting to rehearse and prepare.”

Instead of focusing on your skills, focus on why your pitch matters to the person listening. This is where the homework on the 13+ questions is handy. Describe your favorite client and how you’ve changed their life. Describe what you have done and will do instead of the skills that help you do it. What is your specialty — the stuff you do best?

Tell your story, we’re wired to hear them. Robert McKee, a screenwriting lecturer, says all great stories show a protagonist wrestling with antagonizing forces, maintain a sense of mystery and even an element of loss — so share the challenge you face, the amazing solution you’ve discovered and the uncaptured promise that lies in front of you. Hook your listener — get them interested in who you are.

Finally, practice. Practice for two reasons. First, you’ll be surprised how often you get to use your pitch and most often it’s in unexpected places. Second, you don’t want to stumble when you get the chance.