In the past 6 months have you led or corporate leadership conducted a discovering opportunity review? In the past 6 months have you, corporate leadership or operation’s management conducted a monthly operation’s review? Most likely, no to the first question and yes to the latter. For the existing business monthly reviews (weekly, daily for day-to-day personnel) are critical to evaluate performance to plan. To ignore discovering opportunities as a monthly requirement may limit the business for growth, increased profits and potential new markets.
The current conditions – economic, political, COVID scenarios, supply chain, office space, communication is it virtual or face-to-face, work remotely or at the office, education at all levels, labor force and others are certainly reasons to evaluate the external process within your industry. Since January 2020 businesses have seen changes to processes, some are upside down and there are most likely more opportunities. Some companies are innovating that will impact their revenue and profits positively. Does your company, your employer have the resources to discover opportunities and drive them to revenue and profits?
I suggest that you consider two aspects for discovering opportunities – process need. First, what to look for to identify the process need. Secondly, what the corporate business model is to advance ideas and achieve revenue and profits.
What is required for discovering opportunities – process need in industry or service? Peter Drucker in Innovation and Entrepreneurship presented some guidelines. The ultimate objective is to identify and lead to increase revenues and profits. You and all in the company are potential experts. Are you on the hunt?
In order to identify a process need, what should you focus on? According to Peter Drucker, it has these characteristics (p 69).
- “It exists within the process of a business, industry or service
- It begins with the job to be done
- Task focused
- Perfects a process that already exists
- Replace a link that is weak
- Redesigns an existing old process around new available knowledge.”
Let’s break this down into some specific requirements or details. The clearest opportunity in process is based on a need that Drucker said, “the need must be felt,” and the need must be understood (p 74). Drucker provided further guidelines in the identification of a need with the following (p 73).
- “A self-contained process
- One weak or missing link
- A clear definition of the objective
- That the specifications for the solution can be defined clearly
- Widespread realization that there ought to be a better way, that is highly receptivity.”
Because process need is within an industry or service, everyone that works in them (you for example) are a potential candidate to identify, present, communicate and advance the idea. Drucker noted, “everybody in the organization always knows that the need exists” (p 69). Unfortunately, no one does anything. Why? There were reasons then (1985) and now. One way to ensure for any idea’s success, there is a clear pathway to advance the idea. Without a clear pathway, the obvious could remain dormant only to be discovered by some other company or an employee who leaves and takes the idea out the door. William Connor was one example in the past. This is not to be another level of bureaucracy but an additional functioning segment. It is specifically for discovering opportunities.
Several key elements for a corporation to discover opportunities of any kind includes a process – with responsibilities, accountability and expectations clearly defined, built upon an organizational structure that supports it, focused, simple and nimble; assigned employees (volunteers) who are committed with the professional skills required; provided the needed resources of funding, executive insight, governance, guidance, sponsorship, and compensated accordingly. The purpose of the process model is to collect ideas, evaluate, document, recommend the idea to a review panel who are objective, unbiased and move forward to test, pilot, scale and commercialize. A discovery opportunity model will prove in the long-run to benefit the existing business.
The organization structure for the discovering opportunities model needs to be separate from the day-to-day operations. Direct reporting should be to the CEO or another C-level executive. Otherwise, it will become lost in the existing business challenges or crisis for meeting customer expectations. This is true for any innovation or new thing to the existing business as Drucker clearly explained based on his experience.
The right people in the right seats are imperative. This group will have passion for new, embrace change, comfortable in an unscripted environment, discerning, leverage information and research, seeks out of the box ideas, relies on creative thinking, collaborative, decisive, willing to trust their team members, demonstrated ability to communicate with all levels of the organization, committed to deliver results and be held accountable.
The need for executive resources – governance, guidance, sponsorship, coaching and mentoring requires clear explanation, timely reviews, updates and those who are invested completely in the program’s objectives and outcomes. The executives need to resist delegation for discovering opportunities or any innovation program because it generally leads to failure. The executives need to recognize the team for their success and take/share responsibility for failures. The funding and all resources need to begin small, budgeted, updated, monitored as any other investment or expenditure in the company. However, to measure the value of the program can’t be the traditional metrics applied to the existing business. The reason is because the dynamics of this specific program. A one size fits all model is difficult because how this program unfolds in each company most likely will have nuances. One thing for all companies that will promote the program and lead to success is an engaged, committed executive team who ensures needed resources, sets aside their own preferences, recognizes success and support for failure.
Drucker provided 3 specific guidelines to consider with discovering opportunities – process need
- The opportunity must be felt and understood. Understood so specifics for a solution can be defined, engineered, developed, presented and a clear response for the opportunity promoted to the market.
- Knowledge to meet the process need is required. If the knowledge is yet to be discovered then now is not the time to proceed. An example of this is in the light bulb opportunity.
- “The solution must fit the way people do the work and want to do it.” People in 1985 and now appreciate simplistic solutions which is now highlighted because of technology, mobile apps. A click away is a mainstay for advertising (pp 73 – 75).
With the rapid advance of knowledge, access through the internet, knowledge may not be the barrier it was in 1985. However, barriers within any company remains when it comes to change of any kind or something new that impacts status quo. Drucker clearly explained this in 1985 and it remains. His example, it only takes one executive to say NO to the entire process for discovering opportunities or innovation and it all stops immediately. I personally witnessed this and it unraveled long-term employees’ lives and destroyed momentum. What the long-term implications are unknown to me.
Companies are generally not organized for discovering opportunities or successful at innovation from idea to commercialization. Does your employer or the company that you lead include discovering opportunities regularly? Have you discovered any opportunities? Have you taken any action? Is there an internal process established? If not, should there be?
For the foreseeable future COVID scenarios and many other global economic conditions requires every company large or small to be on the hunt for discovering opportunities especially in the area of process need. During COVID missing links or weak links were clearly displayed.
One metric for you to examine if you need to discover opportunities or innovate, what is the company’s annual revenue and profits from new products or services for the past 1, 2, 3, 4 and 5 years as a percent to the total? Does the leadership identify a reasonable percentage target to achieve? Should there be?
All the best in your opportunity journey. Check out my website for more information on the existing business, discovering opportunities and innovation.
My next blog on Discovering Opportunities is on Industry and Market Structures.