In a recent survey reported by the Financial Post, one in three Canadians said they were interested in starting their own business in the next two years. Of those, 35 per cent said they're going to follow through.
If even half of those do follow up on their dreams, that will be quite astonishing.
What will also be astonishing, however, is if those thousands of would-be Canadian entrepreneurs proceed as 21st-century entrepreneurs instead of blindly imitating the entrepreneurship methodology of 30 years ago. Anyone who takes up the challenge of business start-up today would do well to examine how entrepreneurship has changed in this century.
The biggest change is that today, less is best. Starting a business now is all about less -as in less elaborate business planning; less imitation and more innovation; less step-by-step execution and more going with the flow; less one-way delivery and marketing and more conversation with customers.
This less-is-best concept generally goes against traditional business training. Business plans, for example, are about execution of known factors, so if you're building a factory that is going to be around for 10 or 20 years, you'll need a business plan. But in today's world of continuing change, any plan that details steps further out than quarterly or semi-annually is unsuited for anyone starting a small business.
The top entrepreneurship method now is the lean startup, an application of Lean thinking, an organizational method of operation derived from the Toyota production system. In Lean thinking, an organization attempts to eliminate wasteful effort and cost.
Lean thinking means new start-ups rarely use formal business plans because in a rapidly changing world they cannot obtain the information they need to plan several years in the future.
The lean start-up applies the Lean thinking approach at the crucial period when new companies often have a concept but really don't know how their businesses are going -evolve. Since most new businesses -even those in traditional areas such as retail or services -now primarily operate online, this learning process is much easier.
Generally, a Lean start-up features three characteristics:
- It keeps costs low by using open source and free software. -those aren't available, it uses low-cost cloud computing (renting software and other services online) instead of initially buying expensive systems and so ftware. They also try to "rent" as many business needs, such as personnel, as possible;
- It applies agile development when creating products or services. -this methodology, product development borrows from new software-creation models. Agile development is perfect for startups in which the problem (the genesis for all business concepts) and the solution (the business's answer to the problem) are still fuzzy;
- It constantly talks with customers, existing or potential, to see how they can improve. It usually begins with a simple product or service and then changes or expands it to answer customer concerns. Its main business process is continual customer research and development.
A good example of this form of small business development is Stewart Butterfield of Vancouver, who cofounded with his then-wife Caterina Fake a company that had developed a multi-player online game. The game went nowhere, so they dumped it and began working on an instant messaging application that had features such as game-like experience and the ability to handle photos. That soon evolved into a photosharing application that, in 2004, became Flickr, now the most dominant photosharing site on the Internet.
Fake said the pair couldn't write a business plan because they couldn't do any research on where the company might go. "We weren't planning on building a photosharing site," she said. "If we had done our research, we would have said we shouldn't bother because it's all been sewn up (by competitors)."
The biggest lesson is that in the early years businesses often change as they attempt to find a market niche in which their concept meshes with customer needs.
© Copyright (c) The Montreal Gazette
No comments:
Post a Comment