Friday, July 2, 2010

Management Technique

Every great business is born in somebody's mind. Before there's a business, there's an idea. How can you find a true winner, a better idea than anybody else's? Do any methods mine the mind more effectively?

Once a company is up and running, the need for ideas is just as pressing, and the payoff for effective thought just as high. The more and better the ideas, the bigger and better the business. That doesn't mean that all successful entrepreneurs are great thinkers - but they're often great thieves.

As I've written before, it saves much time and trouble to steal ideas from somebody or somewhere else. A sharp-eyed citizen of the Pacific Northwest thus spotted the little stand-up espresso bars that proliferate in Milan, adapted the idea to American tastes, and generated a $330 million business named Starbucks, with 514 outlets and a growth rate of 70% per year.

But that brainwave still had to be processed through the entrepreneurial brain. That process included the adaptation, the sites, the name, the offering, the design: all the elements needed to marry the Italian idea with a quite separate perception - that American coffee was awful and that Americans would pay for something better.

So even for idea thieves, the key is thinking - the ultimate management techique. Like any technique, it can be improved, which is why people attend meetings like the International Conference on Creative Thinking recently held in Malta. Meetings may seem a far-out way of spending time and money: but being far-out and far away holds one of the keys to bigger and better ideas.

Louis Farrugia, a Maltese businessman, cogently illustrates the point. He travelled all the way to Scotland for a management seminar, carrying with him a weighty problem, His brewery on the island wasn't responding to his efforts to achieve profitable change. His initiatives were getting through to some people, not to others.

The Scottish seminar gave him the idea that broke the logjam, though not directly. The visiting guru, Tom Peters, provided no specific answers to the brewery problem. But his far-out management thinking, deliberately provocative, provoked Farrugia into producing some brand-new ideas of his own.

He went 'outside the box', meaning that you no longer accept the situation as is. Some parts of the brewery, like distribution, were performing marvellously. But the parts weren't recognised or organised as distinct operations. Everything was piled together as an indivisible whole, a single company.

The answer was to divide - and conquer. The brewery was split into units, none larger than 100 people, each headed by a general manager. They were made responsible for meeting their financial targets and rewarded accordingly. And it worked like magic: sales and profits both shot up.

That particular approach to improving performance generally does work: another idea that may be well worth stealing. But the main point here is that thinking differently is encouraged by exposure to different thinking - and being different is often the golden key that literally makes all the difference between brilliant success and nothing at all.

You can, sometimes, succeed as a 'me-too', imitating exactly what somebody else does. But it's far more promising to do a Starbuck, providing a product or service (excellent coffee) that isn't available elsewhere, and doing so in a way that is also unique. The Aroma chain in Britain is following a quite similar strategy - again, adapted to different local circumstances.

That's where bigger businesses often go astray. Many chief executives, believe it or not, can't say what distinguishes their company from any other. It makes them vulnerable to attack from smaller firms which know exactly why they are special, and who are often specialists. The big boys simply haven't thought. The specialists have - and it pays.

So can you think better? Try 'visionising', as recommended at Malta by Professor Sidney Parnes. Envision your desire. Find all available facts. Identify problems, writing down many ideas for solutions. Examine and re-examine the ideas until you reach the 'more workable, acceptable, stronger, more effective' idea-solutions. Critically, though, take early action to turn wishes into deeds. As Parnes says, one constructive action is worth a hundred New Year resolutions - and, maybe, umpteen thousands of pounds.

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