GUEST POST from Matthew E May

…you’ve defined the problem with the old one, reframed it as a choice between at least two mutually exclusive options, and generated some initial possibilities through focused, facilitated brainstorming.

(Side rant to all the creativity “experts” out there poo-pooing brainstorming: Go pound sand. Brainstorming works very well with proper focus and facilitation. Creativity thrives under intelligent constraints.)

Let’s assume you’ve got clarity and consensus on your current strategy (If you’re not, check this post for a list of questions to help you achieve clarity), using Roger Martin’s Playing To Win framework. That is, you’re clear on:

1. Your current winning aspiration,
2. The spaces in which you’re currently competing,
3. The basis of your advantage in those spaces,
4. What specific activities and capabilities produce that advantage, and
5. The systems which support and sustain those capabilities.

Here are the three things you need to do before you dive into drafting a new 5-point strategic cascade.

1. STATE YOUR PROBLEM

The first thing you need to do is to agree on the most pressing and troublesome strategic problem you’re facing. Has your leadership position slipped? Is market share shrinking? Have competitors surpassed you with better products or services? Is growth not happening as fast as you’d like? Are your capabilities becoming irrelevant with end users?

As with any problem solving, you’ve got to grasp the current situation and identify the strategic issues that have you thinking you need a new strategy in the first place.

If you’re not sure where to start, walk through the areas that you’ll eventually reverse engineer with “strategy’s magic question” (i.e. what must be true?). Basically, you want to discuss current challenges in your chosen segments, your channel customers, your end users or consumers, and your capabilities and costs in comparison to your competitors.

If you’re like most of us, our current strategy is rather target-rich…meaning you have more than one pressing issue. Pick the one that’s keeping most everyone up at night. That’s your bogey.

2. REFRAME YOUR PROBLEM

Here’s where strategy differs from problem solving. You’ll be tempted to begin analyzing the problem. Don’t. Instead, reframe the problem as at least two mutually exclusive high-altitude approaches to the problem. For example, if your problem is inferior capabilities versus your competitors, the choices could be between building new capability and outsourcing. (At the most generic level, the choice is always going to be between more of something and less of something. The language may change, but the basic choice remains the same. e.g. “broaden vs. narrow,” “up market vs. down market,” “generalization vs. specialization,” etc.)

One of the key ideas in the Martin framework is that successful strategy combines logic and creativity. In other words, there’s an art to strategy, and as that clever guru of strategy Frank Zappa once said, “The most important thing in art is the frame. For paint, literally. For other arts, figuratively — because without this humble appliance, you can’t know where the art stops and the real world begins.”

3. BRAINSTORM POSSIBILITIES, CLUSTER & CULL

You’re still not ready to dive into the new strategy work just yet, basically because you have nothing to dive in to. What you want to dive into is possible where to play/how to win combinations that you riff off of each of the two choices that reframe your problem. In other words, you’re looking for a good double fistful of “how-to’s” for the two choices…possible ways to

This is where a solid 30 minutes or so of brainstorming will work wonders. When I work with groups, I like to split that 30 into 15 minutes of individual brainstorming and 15 minutes of group brainstorming. The first 15 makes the second 15 very productive.

Roger Martin likes to approach brainstorming possibilities as “a happy story about a potential future that lays out where your company plays and how it will win there.” Start by thinking up different ways to either broaden or narrow where you play. Think through the various spaces in the categories of customer segments, channels, product/service offerings, geography, stage of production, etc.

Then you can think about various ways of winning. One creative device might be to play the “what would X do?” with respect to what Michael Porter in his seminal Competitive Strategy identified as the only two broad categories of competitive advantage: low cost or differentiation. So, “what would Amazon do?” (low cost) or “What would Apple do?” (differentiation) in these spaces.

Note: you’re still not into drafting a strategic cascade yet! You’re just brainstorming. And as with any brainstorm, you’ve got to synthesize your ideas into something both meaningful and relevant to the problem. The best way to do that is to simply cluster the where to play/how to win possibilities by general theme. You might have three basic themes: broaden, maintain, narrow. (Remember, you haven’t scrapped your current strategy, and it remains a viable strategy at the moment.)

The last thing you want to do is to cull those thematic possibilities into the few that you will then draft a full strategic cascade for. Roger Martin recommends three to five possibilities, plus the current strategy.

HYPOTHETICAL EXAMPLE: STAR FITNESS TRAINING

Joe and Mary Buff, former Crossfit winners, offer in-home personal training services to an upscale clientele in the Hollywood area. Their clientele, which includes some celebrities, pay a premium over even the highest-priced health clubs for their personal attention. They are very successful with this strategy, but have reached the limits of scale in their business and cannot take on new clients. They view it as a good problem to have, but a problem nonetheless.

They define the problem in three words: “ceiling on growth.” They reframe their problem as two choices: 1. expand into new client segments, and 2. offer new products to existing clientele. These are two completely different choices, and each has a number of possibilities:

• expand to cover all of Southern California by franchising Star Fitness Training
• extend into high-end health clubs
• expand through boutique storefront studios
• expand to downscale clientele with trainer certification model
• offer exercise DVD products
• offer nutritional products
• offer exercise equipment

Clustering these possibilities might look something like: A/grow geo area, B/diversify clientele, and C/fitness products:

A. Grow geo area:

• expand to cover all of Southern California by franchising Star Fitness Training
• extend into high-end health clubs
• expand through boutique storefront studios

B. Diversify clientele:

• expand to downscale clientele with trainer certification model

C. Fitness products:

• offer exercise DVD products
• offer nutritional products
• offer exercise equipment

From these seven, they select three possibilities they believe are worth exploring, and scrap the rest: 1/expand to all of Southern California through franchising, 2/expand into less affluent client segment by hiring, training, and certifying new training associates, and 3/offering exercise DVD products.

Next up: a tool to explore strategic possibilities.

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GUEST POST from Matthew E May

“If I had the key members of your executive suite all in the same room, would they all be able to articulate the essence of your business strategy clearly and consistently?” I asked the executive vice president of strategy.

“Probably not,” she replied. “But I do know we need a new one, because the current one isn’t working.”

I hear this quite a lot. It’s fine to want a new strategy, but it doesn’t make sense to move to a new strategy if you’re not completely clear on the current one, because formulating a new strategy starts with defining a strategic problem culled from the current strategy.

You know you’re clear on strategy when:

• you know what it means to win with customers.
• you know what it means to win against competitors.
• you understand the dimensions along which you’re able to win–with customers and against competitors.
• you know who your key customers are.
• you can describe your customers in a single sentence.
• you know the channels through which you serve your customers.
• you know your most winning product or service.
• you know all the regions in which you offer those products/services.
• you know the stages of production in which you compete.
• you know where along the value stream you participate, relative to competitors.
• you have consensus on whether you are basically broad or basically narrow in your approach.
• you understand your unique competitive advantage.
• you know exactly why customers choose you over the competition.
• you know whether your competitive advantage is either low cost or differentiation (not both).
• you understand how your competitive advantage is linked to where you play.
• you know your key strengths and activities that bring your strategy to life.
• you understand which of your strengths are superior to the competition’s.
• you know which of your strengths are most relevant to customers.
• you understand the systems that give rise to and support your capabilities.
• you have a method to clearly gauge the success of your strategy.

Now, allow me to add a bit of separation and categorization to these 20 questions, and you’ll see Roger Martin’s strategic cascade of five integrated questions appear. I’ve adopted the framework both personally and professionally, and use it in just about every activity for which I want to achieve success, from biking to business.

1. What is our winning aspiration?

• we know what it means to win with customers.
• we know what it means to win against competitors.
• we understand the dimensions along which we’re able to win–with customers and against competitors.

2. Where do we play?

• we know who our key customers are.
• we can describe our customers in a single sentence.
• we know the channels through which we serve our customers.
• we know our most winning product or service.
• we know all the regions in which we offer those products/services.
• we know the stages of production in which we compete.
• we know where along the value stream we participate, relative to competitors.
• we have consensus on whether we are basically broad or basically narrow in our approach.

3. How do we win?

• we understand our unique competitive advantage.
• we know exactly why customers choose us over the competition.
• we know whether our competitive advantage is either low cost or differentiation (not both).
• we understand how our competitive advantage is linked to where we play.

4. What capabilities do we need?

• we know the key strengths and activities that bring our strategy to life.
• we understand which of our strengths are superior to the competition’s.
• we know which of our strengths are most relevant to customers.

5. What management systems must we have?

• we understand the systems that give rise to and support our capabilities.
• we have a method to clearly gauge the success of our strategy.

Once you’re clear on your current strategy, then (and only then!) you can talk about the most troubling areas of that strategy, and begin to contemplate a new one. The test, and final question, is this:

If I had your executive team in a room together, would there be consensus on all these questions?

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GUEST POST from Matthew E May

On a recent visit to a former client’s workplace I noticed a poster entitled “I’m Not Changing!” I’d seen it elsewhere, and I’m sure you’ve seen it as well, or something like it. This time it gave me pause, perhaps because we’re now starting the second half of the year, and calendar milestones tend to trigger the “fresh start” effect. We stop, take a breath, reflect, and start anew.

So this time, I started thinking about change, and how change at any level, be it personal or professional, is always difficult. It’s the subject of countless books and articles, including my own, including this one.

I’ve been in the change business now for well over 25 years. Every year I seem to collect yet another reason, however nuanced, for why we, and our businesses, have such a tough time changing. Resistance and pushback come in many different flavors, but I have heard enough now to be able to catalogue them.

So…

Here are top twenty reasons you and/or your company won’t change.

1. Fear. We have an innate fear of the unknown. “I’m afraid of what will happen.”
2. Myopia. We can’t see that change is in our broader self-interest. “This won’t help us.”
3. Selfishness. Unless change immediately pays off for us, we’ll resist it. “What’s in it for me?”
4. Homeostasis. Equilibrium is more comfortable, change is uncomfortable. “I’ll feel better when things are normal.”
5. Ego. Those with power have to admit they’ve been wrong. “I feel I’ve positioned us well for the future.”
6. Sleepwalking. Too many people live unexamined lives. “I just don’t get it.”
7. Lack of confidence. Change threatens our self-worth. “This will reveal the true me.”
8. Timing. Certain preconditions have to be met for change to occur. “I’ll change when the time is right.”
9. Human nature. We are naturally self-centered, and change requires some selflessness. “Others will benefit more than me.”
10. Inertia. A body in motion takes considerable force to alter course. “We’re already down another path.”
11. Short-term thinking. People have difficulty seeing and supporting long term visions. “I can’t see that happening.”
12. Perversity. People perceive only the opposite or downside outcomes of the change goal. “That’ll make things worse.”
13. Complacency. We like the path of least resistance, we’re not natural maximizers or optimizers. “I’m satisfied with the ways things are.”
14. No constituency. The power base of the status quo is greater than that of those trying to bring about change. “There’s no critical mass behind us.”
15. Groupthink. Social conformity limits our thinking. “What does the group want to do?”
16. Short selling. Perceived lack of knowledge, skills, tools and experience. “We’ve never done this; we don’t know how to do this.”
17. Exceptionalism. People can’t see the situation objectively. “That may work elsewhere, but we’re different.”
18. Futility. Change is seen as superficial, not worth the effort. “Why go through so much pain for so little gain?”
19. Cynicism. People distrust the intentions, motivations, or track record of change. “Here we go again.”
20. Future shock. Grand scale change makes people hunker down, sensing they may not be able to adapt. “I smell disaster.”

Have you or your company fallen prey to one or more of these in some respect? I know I have. And that’s good news, because simply recognizing self-censoring or self-defeating responses like those above is a great first step.

If like me you view July as a chance to re-evaluate, reboot and rethink goals and directions for yourself and your company, you might want to keep an eye out for when (because they will!) resistance and pushback disguised as one or more of these twenty reasons show themselves.

And when that happens, perish the thought.

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GUEST POST from Matthew E May

I started developing a visual tool for team facilitation of strategy development over two years ago, after I learned the Playing to Win framework from Roger Martin. I’ve always liked using good old paper and Post-Its, ever since I learned what was affectionately referred to as “the big paper process” when I was working with Toyota many years ago.

After dozens of iterations I’ve finally settled on a format that people find simple, fun, and effective. And for a limited time, I’m going to make it available free under a Creative Commons License, which essentially means you can use and tweak it providing you include attribution, and don’t try to monetize it in any way.

Here’s what it looks like. It captures the entire strategy formulation process, including the identification of the key strategic issue, reverse engineering, and initial test design, as detailed in Roger Martin and A.G. Lafley’s book, Playing to Win. (Disclosure: Roger Martin has seen the various iterations and advised me on changes.)

The previous version was not standalone. This one is. It is designed to be at once a visual tool, a creative device, a standard operating procedure, and an artifact of a team’s strategic thinking. There are guiding questions as well as tips to keep in mind for each key stage of strategy development.

The process for using it is straightforward: print the canvas, grab some Post-It notes (large and small, various colors), a sharpie, and start working. I will be providing a facilitation guide in the future. For now, know that the only rule is “don’t write on the canvas!” The exception being your/your team’s name. Everything else is meant to be movable and flexible, thus iterative and loopy.

My own personal strategy formulation process goes something like this:

1. Map the current strategy using yellow Post-It notes, boxes 1 through 5. If you’re using the wall size, use 3×3. For the A3 size, use 1.5 x 2.
2. Identify the key issue with the current strategy, write it on a Post-It and put it in its place.
3. Draft a new strategy. Use different colored Post-Its if you wish to use a single canvas. Otherwise, use a separate canvas for the new strategy.
4. Think through what must be true for your strategy to be valid (box 6). Identify your most worrisome assumption.
5. Craft a “lean” experiment focused on your most worrisome what-must-be-true.

I’ve produced the canvas in two sizes: a wall size poster (54 x 36 inches), and a placemat A3 size (11 x 17 inches). I’m contemplating an iPad app for it.

To download the wall poster, click HERE.

To download the A3 placemat, click HERE.

The Play-to-Win framework is one of the simplest but most powerful frameworks I’ve run across, and I use it both mentally and physically for all significant choicemaking. It’s made me a far more, er, choiceful individual.

I even used the A3 to map out the strategy for my latest book, Winning the Brain Game: Fixing the Seven Fatal Flaws of Thinking,which is available now.

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GUEST POST from Matthew E May

Guy Kawasaki needs no introduction. He’s the original Apple evangelist, turned ultimate evangelist. From the art of startup to artisanal self-publishing, Guy takes his current endeavor to a level of artistry.

Ten years ago, anything resembling what we now know as social media was a blip on the typical web surfer’s radar screen. Now everyone is a social media user. But not a “power user.”

And that’s where Guy comes in. He is. A power user, that is. I’ve watched his follower base grow 10X in the course of less than two years. He has millions of fans and followers across the full spectrum of social media.

So it should come as no surprise that he’s penned (yet another) bestseller on the topic, this time with coauthor Peg Fitzpatrick: The Art of Social Media: Power Tips for Power Users.

It’s the kind of book you want on your mobile device for handing reference at all times. It’s a fast read, chock full of practical, immediately useful techniques

I had the chance to throw a few fun questions Guy’s way. (Here’s a tip to all you authors and interviewees out there: pay attention to how Guy answers a question. Soundbites, people, not sermons! There’s no editing here!!)

You stunned me when a few pages in you openly admitted to not knowing how social media works.

If you tell people what you don’t know, they’ll believe you when you tell them what you do know. This isn’t a simple matter of ignorance. Social media changes so fast that depending on what side of the bed Mark Zuckerberg and Dick Costolo get up in the morning, you may have to change what you do.

Why does being a power user of social media matter?

Being a power user of social media doesn’t necessarily matter if all you want to do is keep in touch with friends and relatives to show them when you’re drunk, pregnant, or at the beach. But if you want to use social media as a marketing platform to achieve professional goals, then it’s essential. For this use case, social media is the best thing that ever happened because it’s fast, free, and ubiquitous.

What distinguishes a power user from a normal user?

5,000 followers.

What’s the number one thing people do wrong in social media?

It’s hard to isolate one thing. The most common mistakes are not adding a graphic or video to every post, not repeating posts, and not sharing content that is worth re-sharing.

Why is asymmetry important?

You mean visual asymmetry in avatars, right? It’s important because it makes an avatar more visually interesting. People make snap judgments based on avatars: worth paying attention to or not. Social media is like Tinder, not eHarmony.

Can I ignore all these tips and still be a heavyweight social media influencer?

Sure, if you’re POTUS, Kim Kardashian, Paris Hilton, or Michael Strahan. Also, if you or your agency buys likes, circlers, and fans, you can fake being a heavyweight. But for the rest of us, you have to earn your stripes, and this book shows you how to do that.

Let’s say I implement all of your power tips. Will it bring me a 10x increase in followers, friends, likes, etc?

This is hard to say. It would take six to twelve months, and you’d have to work one-two hours every day. You’d have to constantly find, optimize, and post valuable content. It can be done, but it takes a lot of work.

What’s in your book that I can’t discover for myself simply by using social media?

Nothing, but it would take you years and a very curious mind. You could say this about any book other than those by Stephen Hawking, maybe.

Agree or disagree (and why): Social media for most people is about being famous without being really good at anything.

Disagree. Social media for celebrities is about being famous for being famous. Social media for the rest of us is about providing value.

What’s one secret tip people can only get by reading your book?

If you add a big picture (say 1024 x 512) to every tweet, you’ll double engagement. If you repeat your tweets every eight hours for twenty four hours, you’ll triple your engagement. If you do both, you’ll increase engagement by six times.

Care to weigh in on LinkedIn’s move to become more of a publishing platform?

LinkedIn’s move is awesome because it’s the publishing platform that unless you’re a total idiot, you need to put your best foot forward because what you do affects your livelihood.

This book is focused on the individual. Is your advice essentially the same for the corporate user side of social media?

My advice is essentially the same for the corporate user except that the avatar should be your logo, not your face. Duh. That said, corporate users with digital agencies are the least likely to embrace the recommendations of the book. This is because agencies are incentivized to buy their way into social media.

Media of any kind is about communication. Communication of any kind is comprised of a sender, a receiver, and the message itself. Your entire book is about sending and messaging…nothing on receiving?

This isn’t completely true. One of the main topics is feeding the content monster, and one of the best ways to feed the content monster is to figure out who posts the best stuff that is relevant to your current and prospective followers.

What’s the future of social media look like five years from now?

This is one of the main things that I freely admit to not knowing. Five or so years ago, people thought that MySpace would be the operating system of the Internet and companies like Amazon would be renting space in MySpace’s world. I rest my case.

What’s the one thing you want readers to take away from The Art of Social Media?

This is a trick question. If there was only one thing, I would write a blog post to explain it—maybe even a tweet. The Art of Social Media is the best book ever written about social media. I want readers to take away dozens of things from reading it.

And that is how you answer interview questions in the age of social media.

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GUEST POST from Matthew E May

One of the most challenging sociodemographic dynamics facing business owners is literally one for the ages: how to deal with the “new generation” of customer, partners, investors, and employees.

Social values and norms are shifting so rapidly, and an accelerating rate, that a business culture may look and behave significantly different than it did six months ago, simply because a critical mass of younger associates have been onboarded. The customer segments you’ve targeted reliably for the past decade may next month disappear completely, simply because a new app has rendered your product or service obsolete.

What’s a small business owner to do? To help me sort out the answers, I turned to Dan Keldsen, co-author with Thomas Koulopoulos of a great new book, The Gen Z Effect: The Six Forces Shaping the Future of Business.

Why did we start naming generations at the end of the alphabet…X, Y, Z?

Generation X was actually coined back in the 1950s and popularized by Douglas Coupland in 1991 in his bookGeneration X.The naming convention that began with X ­– as the generation that supposedly lacked direction and definition – and then continued Y through Z was essentially an accident.

It’s time to rethink generational labels entirely. What traditionally defines generations is mostly a set of unexamined and lazy stereotypes of each “unique” generation. We’re living in a post-generational world that’s being held back by these stereotypes. That’s one of the cornerstones of The Gen Z Effect.

Every generation has its gap, its departure from the previous. What’s different about the Gen Z gap?

In our research we found that the gap between generations is being increasingly bridged by the use of common technologies across all ages. The hyperconnectivity of email, texting, mobile devices, and social media are making the notion of a gap less and less relevant to how we understand behaviors. What is important is individual behavior not generational behavior.

While we can all adopt the behaviors of Generation Z, those born into it (after 1995) are the first true “digital natives” to have internet access from birth, with “smart” devices as their first play things, and are truly born directly into being hyperconnected all the time.

That reality for Gen Z kids is also the reality for all of us now. Even people who were terrified of computers and had never owned one prior to their first smartphone, now can’t imagine life without one.

Ultimately the idea of a generational gap holds us back from connecting and collaborating across ages, personally, professionally, and as a society.

I’m a small business owner with eight employees. Why does Gen Z matter to me?

Gen Z are your customers right now, even if their parents are paying the bills. They are already two billion strong and wield enormous influence due to their ability to form communities and use social media as a personal megaphone. If you’re small company they have a lot to teach you about how to create an impression and have the impact of a much large company. Soon, they will be your employees, your competitors, they will become your trusted advisors, managers, partners and friends.

They are also the leading indicators of the behaviors that we are ALL embracing, and they adopt new technology at a faster pace than ever. That means that they are bell weathers of what’s coming next and why it matters. Simply put, if you’re not paying attention to what they are unafraid to say they want, you are missing out on what older generations want, but haven’t yet voiced. They are the leaders of a post-generational revolution that is washing across ALL age groups, and they aren’t going to be satisfied with excuses.

How did you settle on the six forces driving the Gen Z effect?

I joked with my co-author and longtime friend, Thomas Koulopoulos, that we should make a video similar to the Moses scene from Mel Brooks’ “History of the World Part 1” – where Moses steps out with three tablets for a total of Fifteen Commandments. He’s about to unveil the commandments and suddenly trips, dropping and shattering one tablet to bring the masses the “Fifteen (crash), Ten Commandments.”

We had a similar experience in putting together our Six Forces. Based on our early research, and as we began to flesh out the book, we initially had twelve forces. As we began refining the outline and parsing our research, we condensed and prioritized the forces, eventually settling on five.

But something was bothering me. I realized that we had inadvertently skipped innovation as an explicit topic in the book. As a result I coined the term “Slingshotting” to describe one of the most dramatic of the Six Forces.

Slingshotting is the force that allows a significant portion of the population to move all at once, and apparently overnight, from the past into the future. We’ve been experiencing slingshotting in very large waves in the last ten years. It’s the force behind the fact that there are now an average 2.5 cellular-enabled devices per person, and that on Apple devices alone, over sixty-five billion apps have been downloaded since the first iPhone was released.

What is the most significant business implication of the “hyperconnecting” force?

Hyperconnecting is the foundation for essentially all businesses and people. Being “on the net” used to be a very rare, expensive, and slow experience, requiring far more patience and technical skill than an average person should have to deal with. Fast-forward to today, and within 10 minutes, and just about anyone can come up to speed with a smartphone that is faster, smarter and always connected—and it doesn’t need a user’s manual; that, quite literally, wasn’t possible or affordable. Period. And that shift has happened in just the last 7 years.

For small businesses, that means that they can suddenly take advantage of dramatically lower costs, and frankly, far better options than the traditional options for sales, customer service, and mobile payments.

Right now I’m in a small rural town in the Midwest, with a population of 13,000. at a very small, one-man shop paying by credit card. How did he take the credit card payment? A credit card reader attached to his smartphone, which instantly sent an email receipt at the end of the transaction. The cost for a similar solution just five years ago would’ve been tens of thousands of dollars. Today it’s essentially free, aside from the small cost per transaction.

How is the “slingshotting” force different than, say, the forces driving the internet bubble of the late 1990s (which we all know burst)?

The internet bubble of the 1990s was, as they say in Texas, “all hat and no cattle.” It was the beginning of a series of promises that have taken nearly 30 years to bring to the masses.

I’ve been on the internet since 1988, when the internet was a text interface full of secret commands, unbearably slow by today’s standards, and in retrospect, user hostile rather than user friendly. It was built by and for geeks, and now, finally, it is simple yet powerful, affordable, and far more shocking when you don’t have fingertip access to the internet than when you do.

What slingshotting does is to finally bring forth the level of simplicity and affordability that didn’t exist back in the 90s, when computing technology was still primarily for geeks; now it’s for the masses. Slingshotting has brought us the future we’d been promised 30 years ago; a future in which toddlers, grandparents, and everyone in between can be part of at any time they want it.

This is still only just the beginning of the online revolution, but it’s a great foundation to truly usable and useful technology for the masses, globally.

Which of the six forces should a small business owner be most vigilant about?

Lifehacking is the force to watch most carefully as a small business owner. Gen Z kids have less tolerance for rules that have stood unquestioned. They have no issue with working around or “hacking” the system. By hacking, we don’t mean attacking and destroying, but rather finding better, faster, and cheaper ways to solve problems. This “hacking” mindset and the three hacks that we believe will most shape the Gen Z landscape and the future are crowdfunding, 3D printing, and changing attitudes about intellectual property and patents.

These hacks are creating new opportunities for small businesses, including solopreneurs, who can create businesses at dramatically lower costs than traditional manufacturing techniques would require, to raise the funds to develop goods, services, and the business itself, and to leverage the work of others in their field, or to give back to the community.

What’s the one thing you want readers to take away from The Gen Z Effect?

That we are ALL Gen Z, and we are all reaping the benefits of its effect. It’s time to put those benefits, the six forces, to good use, and make the most of our work and lives.

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GUEST POST from Matthew E May

…you might want to talk to Ken Tencer.

A few years ago, I read and reviewed a book entitled The 90% Rule: What’s Your Next Big Opportunity? by co-authors and business partners Ken Tencer and John Paulo Cardoso of the branding and innovation firm Spyder Works.

I recently touched base with Ken to ask him about his latest book, Cause a Disturbance, a bestseller again co-written with Cardoso. Like their previous book, this one’s chock full of practical advice for entrepreneurs and small-business owners on innovation.

For people who may not have read your first book or who may have forgotten, refresh our collective memory: What is “the 90% rule,” and why does it matter?

The 90% rule is a philosophy, not a formula. It’s founded in my entrepreneurial experience, which has taught me to celebrate what I’m doing well in my business—the 90%—but to never let that success lead to complacency. There’s always something we can be doing better. We must continuously be searching and asking ourselves what the next 10% is: the new, improved and better products, services and processes to engage and delight our customers. Today, this is more important than ever. Consumers have shorter attention spans, and they expect more, more often. If you don’t continue to engage them, your competitors will quite happily do so for you.

In your latest book, you talk about the importance of staying innovative as a business owner. If I want my business to be more innovative than it is, what do I do, where do I start, and how long before I see a return on my efforts?

Start by turning your regular sales and marketing meeting into a business development meeting by including innovation on every agenda. Think big, think different, and think customer. Don’t limit yourself.

Ask all team members to bring in new ideas—exciting things they see happening both in your market space as well as in other industries. Encourage everyone to attend business conferences, seminars, workshops and peer groups, and to listen more closely—and more often—to customers in order to increase idea flow and generation. This will keep new ideas and opportunities on the front burner every week, rather than relegate them to the old once-a-year corporate retreat.

Then, identify the ideas that your team believes have merit and assign each project a leader or, as I prefer to call it, an opportunity champion. Have them approach the opportunity with the same rigor you would any traditional project: Present status reports, and solicit input from the group. This helps you keep track of ideas and live projects, and also builds a more engaged team. There’s nothing quite as motivating as involvement and feedback to let people know that their voices are being heard and their ideas implemented.

And don’t be afraid to bring in some of your customers for a show and tell. Make them a part of your team. Customers are the people who buy what you sell. Your success ultimately depends on solving their problems, challenges and needs.

Let’s talk about cash flow, because it’s a major concern for small-business owners. Why is process innovation better than the good old cost-cutting method of boosting cash flow?

When it comes to cash flow, particularly cost savings, it’s important to understand the difference between process innovation and the good old “slash and burn” method of boosting cash flow. In every organization, processes have a significant impact on costs: purchasing, inventories, reworking, downtime, lead-time, material travel time, delivery time, wasted time and so on. All these processes add costs, which means they provide a wealth of opportunities for hefty savings. When you come up with new ways of improving throughput or order processing, or reducing wait-times and delivery times, it’s found money.

Of course, costs must be cut, but the real goal should be to cut costs while driving growth. It can be done. For example, a hotel I studied had surveyed their business guests to find ways to better engage these lucrative, repeat travelers. They found that business travelers didn’t like decorative pillows and bedspreads … too much excess to peel away! The solution was to lose all the expensive excess decorative bedding and replace it with simple, clean white bedding and fewer pillows. The result? The lower bedding costs and quicker maid service led to greater guest satisfaction, along with increased repeat and referral business.

How do you respond to small-business owners who tell you, “I simply don’t have the time or money to innovate”?

The goal of innovation is to keep things fresh in your business, so your customers have reasons to keep coming back. How can you not have the time or money for that?

The importance of innovation is rooted in an ongoing debate between marketing and sales as to which one drives growth more. But I say, it’s no contest. It’s actually innovation—innovation drives what you bring to market, which, in turn, drives sales.

Think about it: Customers are central to every business and every business model. Keeping them engaged with “new, better and exciting” is paramount; therefore, bringing “new, better and exciting” to market is imperative. This is the essence of innovation. If you’re marketing and selling the “same old, same old,” you cannot sustain growth.

It’s like changing the oil in your car regularly. You wouldn’t change the oil in your car just once a year—the engine would sputter, seize up and die. So why leave innovation and improvements—however small they might be—to an annual schedule, planned retreats or sporadic brainstorming? Tune up your innovation engine regularly, and keep it running. Ignore it, and your business engine will begin to sputter.

Why do you think the entrepreneurial spirit, rooted in discovery and innovation, tends to dissipate as companies grow, and what can someone running a small but growing company do to maintain that founding spirit?

We simply cannot allow the front-burner issues that challenge every company to turn us into status quo thinkers. It’s a fight to stay fresh. But it can be easier than you think.

During a recent presentation in New York City, I was asked, “What tools do I need to be an innovator? To stay innovative?” My answer was simple and for many, surprising: “Your eyes and ears.” Opportunities are all around us. When we take the time to notice them, they can stimulate more creative thoughts within each of us.

I really should have added “feet,” because the day before, I had walked 40 Manhattan blocks looking for interesting and outrageous inputs to spur my own creative thinking. A billboard for the A&E TV show Storage Wars caught my eye. It’s a great example of how the simple matching of an idea that reflects people’s desires becomes a commercial innovation. The show is successful because it features modern-day treasure hunters competing to acquire abandoned storage lockers that might contain hidden bounty, at a time when millions find themselves in tough economic circumstances. The combination of hope, fun, triumph and even disappointment is downright intoxicating.

The point is this: Whether you’re a product developer, retailer, manufacturer or service provider, you, too, can uncover the little discoveries and everyday surprises that engage today’s consumers, who are always looking for something new, different, better and fun. All you have to do is get out more.

Lots of books have been written about innovation. What’s the one thing you want readers to take away from this book that they can’t find anywhere else?

This book is written from a pragmatic, entrepreneurial perspective. It demystifies innovation and demonstrates that it is powerful, achievable and critically important to the success of your business. Most important, it does so in a way that can be embraced by any company, even the solopreneur working from their kitchen table.

You can connect with Ken Tencer on LinkedIn and follow him on Twitter.

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GUEST POST from Matthew E May

Your grand strategy seems airtight on paper. You’ve arrived at a winning aspiration. You’ve honed in on an open and attractive segment in which to play. You’ve identified the competitive advantages that will enable you to win in your chosen spaces. You’ve got the capabilities and systems to support your choices.

But as the saying goes, no battle plan survives first contact with the enemy. Generally, that’s because multiple assumptions have been folded in to your strategy–unconscious leaps of faith you’ve made in your natural enthusiasm and optimistic outlook.

If not attended to–teased out, made transparent, and tested in the real world–these leaps may indeed become the very blind spots that will put to rest your best-laid plans.

That’s why we so often hear that making assumptions is a bad thing. (You know, the old quip: when you assume, you make an ass of u and me.) We don’t do a good job of assessing and addressing them.

But what we don’t know far outweighs what we do, so assumptions are unavoidable. It’s how you handle them and exploit them that makes for the true art of strategy in any realm: innovation, business models, etc.

Here’s the thing: your idea, solution, or strategy is just a collection of guesses until they’re tested. There is real power in making bold assumptions, because you can turn them into clear hypotheses, and then scientifically test them in a rapid, iterative way.

Done right, your eventual strategy will indeed survive first contact.

The key lies in your approach. In my experience, simply asking people to list their assumptions doesn’t work, for the simple reason that our assumptions are part of our mental models and biases–they’re so ingrained in our thinking and thus so hard to identify that it takes a tool to lend a bit of objectivity.

People tend to list “known” things for sake of ease and to avoid the risk of looking uncertain. But an assumption by definition is something unknown. And that’s scary…we fear the unknown, and we are reticent to bring it up and make it public.

The best technique I’ve found to alchemically turn assumptions into gold is one which I learned from master strategist Roger Martin a few years ago. It amounts to a single but powerful question: What must be true?

This, as Roger says, is “the most important question in strategy.” He’s been using it for twenty years, ever since a disappointing consulting engagement in which the client went against Roger’s advice, with disastrous results. It was enough to make Roger reflect on his consultative approach.

Then, during subsequent engagement in which he had a strong view of what the best strategic option was, he suddenly realized that it didn’t matter at all what he thought. He realized that what mattered was what his client thought, since they were the ones who were going to have to take action one way or the other, not Roger.

As Roger tells it: “At an impasse, an idea popped into my head. Rather than have them talk about what they thought was true about the various options, I would ask them to specify what would have to be true for the option on the table to be a fantastic choice. The result was magical. Clashing views turned into collaboration to really understand the logic of the options. Rather than having people attempt to convince others of the merits of options, the options themselves did the convincing (or failed to do so). In this moment, the best role of the consultant became clear to me: don’t attempt to convince clients which choice is best; run a process that enables them to convince themselves.”

“From there, I used the most important question in strategy— what would have to be true?—to build an entirely new methodology for thinking through choices. It became the heart of my consulting practice and is the only strategy process I use to this day.”

Here’s how it works…

For each of your strategic options, ask six key “What must be true” questions, in this order:

1. What must be true about the size and attractiveness of our target segments?

(Example: The emerging 27.5-inch mountain bike tire segment will be big and profitable enough to support abandoning our current 26-inch line)

2. What must be true about what our end users value?

(Example: A mountain bike performance and handling sweet spot exists for a 27.5-inch bike that will attract bikers away from both smaller 26-inch and bigger 29-inch sizes.)

3. What must be true about what our channels value?

(Example: Cycling retailers will be attracted to the concept of an all-new kind of mountain bike that would spur cyclists to shift from traditional frames and tires, thus committing floor space to drive sales growth and higher margins.)

4. What must be true about our capabilities vs. our competitors’?

(Example: We can produce a 27.5-inch mountain bike superior to both 26- and 29-inch bikes. We can leverage our partnerships with component manufacturers to convince them to produce 27.5-inch specific parts.)

5. What must be true about our costs vs. our competitors’?

(Example: We can product a 27.5-inch bike that will sell without a price premium to existing top-of-the-line players, including our own lines.)

6. What must be true about how our competitors will react to our strategy?

(Example: Competing bicycle frame makers will hesitate to abandon their 26-inch lines, not risk the investment in 27.5, and wait to see market reaction, giving us first mover advantage and an innovative edge for at least two years.)

You now have six “best guesses.” Each of those guesses are in reality hypotheses, which you can now test by getting out of the building, into the field, and into learning mode.

The next time you face a strategic choice, forego immediate action. Think through the “what must be true” questions. Test your assumptions. Understanding that you can’t know everything, don’t let the clear leaps of faith remain just that. Turn best guesses into educated guesses. THEN, rock your strategy.

My bet is you’ll win the game, if not change it completely. That’s the power and magic of an assumption. It sheds light on the unknown. It lets you learn.

Let the magic begin!

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GUEST POST from Matthew E May

Everyone, in any endeavor, gets stuck at some point. All of a sudden, or so it seems, things aren’t going right. Or even going anywhere. Writers get writer’s block. Athletes suffer from losing streaks.

Running a business is no different. What was working well yesterday isn’t working today. You try many things, but nothing works. You’re at a loss for how to get moving forward again.

The first thing you need to do (after admitting to yourself you’re stuck) is to pinpoint why. The reasons come in many different flavors. Scan the list below. Be honest, and check any that have you nodding your head “yes.”

1. You Treat Your Business like It’s a Job
2. You Think Your Latest Successful Windfall Will Last Forever
3. You Think Someone Is Coming to Save You
4. You Let Today’s Emergencies Dictate Your Plan
5. You Never Take a Break or a Vacation from Work
6. You Take Dangerous Risks Instead of Calculated Actions
7. You Think the Only Alternative to Success Is Failure
8. Your Customers Can’t Find You
9. Your Fear of Rejection Stops You from Selling
10. You Keep Calling People Who Don’t Respond
11. You Stop Marketing as Soon as Your Revenue Increases
12. You Are Always Selling Product Features
13. You Are Selling a Product that can be Purchased Cheaper Elsewhere
14. You Go On Social Media Sites without a Strategy
15. You Hate Your Customers (and Maybe Even Your Employees or Vendors)
16. You Only Hire Employees Who Are Weaker Than You
17. You Allow Lousy Employees (and Customers) to Overstay Their Welcome
18. You Hire for Skills, not Attitude
19. You Are Always Telling Employees What to Do Because You’re the Boss
20. You Think Customer Service Is a Cost Center
21. You Never Ask for Help
22. You Allow Personal Use of Smartphones on the Job
23. You Don’t Know How to Read Your Financial Statements
24. You Think Business Is About Growing Sales
25. Your Fixed Overhead Costs Are Too High

These are the 25 most common reasons we get stuck when it comes to operating our business, according to small business consultant Barry Moltz, and they are capitalized for a reason: they make up the 25 chapters in his new book, How To Get Unstuck.

How to Get Unstuck is a practical reference guide in which Moltz unwraps each of these sticking points, and delivers a no-nonsense, real-world look into the underlying cause(s) of your stuckedness, and then offers several tried-and-true action items to get you going again.

You may not be stuck just yet, but picking up How to Get Unstuck will help you stay that way.

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GUEST POST from Matthew E May

Even if your “Where to Play” (see last post) is not particularly unique, there are always ways to win. Case in point: corner coffee shops, so common they’re found in just about every town and city on the planet. Nothing at all special or unusual about that space.

Who wins in that unremarkable market? Starbucks. Starbucks is the undisputed heavyweight champion of corner coffee shops.

The simple secret to winning in any given space is this: offer a better value equation than everyone else.

Now, there are many dimensions to value beyond quality, cost, and speed. In many of today’s market, those are simply ante to the game. But Starbucks plays a different game. Truth be told, they lose on quality, cost and speed. In fact, when I when to New Zealand, they asked me why I drank Starbucks coffee. To a native New Zealander, Starbucks burns their coffee, charges too much, and it takes too long. Who seeks out Starbucks in New Zealand? Tourists.

For Americans, and Americans abroad, Starbucks wins hands down. What Starbucks has done by understanding the psyche of the typical middle American (at nearly every age) is to create a value proposition that gets into the more emotional and thus transformational (read, winning) dimension of value: the intangibles.

Starbucks doesn’t sell coffee. They aren’t simply a convenient corner coffee shop. They are a “third place.” Something in between your home and office. A place that’s comfortable. A place with a unique experience that exhalts coffee to a far higher level than the typical corner coffee shop and in a far more novel way, a way that effectively produces a sort of daily ritual-forming caffeine cult.

You do not have to be a coffee drinker to appreciate the strategy. You’re not buying coffee at Starbucks. You couldn’t possibly be…no one in their right mind spends $4 on a cup of coffee. You’re buying a third place, a quick escape. You’re buying a personalized daily ritual. You’re buying a clique community. And you can buy it all over the world with consistency.

In fact, you have to speak an entirely different language in a Starbucks, one that they taught you. You’re paying for the Starbucks version of Rosetta Stone. It’s a point of pride with Starbucks clientele.

I remember when I was writing The Elegant Solution back in 2005 and studying Starbucks from the personal ingenuity angle, focusing on the “barrista.” I stood at the end of the line and wrote down a couple dozen drinks with complicated, coded, and nuanced names…and they were no where to be found on the menu board.

And while this treads on the third question in Roger Martin’s cascade (What capabilities do we need?) which I’ll cover in a future post, a Starbucks barrister does not view their job as making coffee. Here’s what one told me in an interview back in 2005:

“This is definitely coffee art. But if you think people are buying coffee, you’re wrong. There’s something going on here…the same people come in every day, even though they have plenty of options. After a while, you get to know people. You talk to them, you learn about them, maybe what they do, or what their kids’ names are. You want to know more. There’s a little bond built. You start to figure out that they look forward to coming here for reasons other than the buzz. They like the familiarity…they like knowing you know their name, that you remember their favorite drink. Our team is like a little family, and they like that. We have fun, and they like that. Energizes them, lifts them. You can see it. There’s a kind of funky trust thing going on. You know how you talk to the bartender or your hair stylist? That sort of thing. It’s funny, you get a certain sense of pride working here that you don’t get other places. I know, I’ve worked in them. And that makes you want to do your job the best you can. More so, even. Make it better if you can. I’m just part-time, I’m in school part-time, I want to be a journalist. But I’ve learned a lot about people being here. It’s going to make me a better writer, interviewer, I think. Not everyone feels this way, but I feel like I’m providing really busy people a nice start to a hectic day in a safe little getaway. We’re picking people up, or perking them up. [smiles] Pun intended. It’s not just a coffee shop, and it’s not about the coffee.”

Lesson: your where-to-play can be ordinary and even fixed, but a how-to-win that is extraordinary compared to your competitors will enable you to win.

Expecting to win by offering essentially what your competitors are offering in essentially the same way and in essentially the same space is the business version of the insanity definition.

It simply does not work. It never has and it never will.

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