Successful business ventures continually introduce new product, service, process, and positioning innovations; they keep improving internal and external transformation methodologies; and they continually monitor goal and objective achievements. New venture development teams are wise to model their venture plan on these core concepts.
Following are some excerpts from a workshop I presented at the University of New Mexcio ...
The primary mission of a new business venture development team is to create an organization that will earn a profit solving customer problems with something new and better than the competition. While this recipe for success seems straightforward, it is not so easy to execute. Experienced mentors can help a venture development team effectively and efficiently move their venture concept through the research, ideation, test, and planning stages to resourcing, launch, stability, sustainability, and growth. There are a variety of proven business venture development tools that can be used to mitigate risks and optimize the probability of new venture success. Based on experience with some 200 internal corporate ventures, spin-off companies, independent start-ups, and over a thousand graduate and undergraduate entrepreneurship students, this paper outlines several of the more useful tools the author has developed and used for mentoring new business venture development teams.
Creating a viable business plan with the appropriate depth and detail is a fundamental undertaking of a venture development team. Successful business ventures continually introduce new product, service, process, and positioning innovations; they keep improving internal and external transformation methodologies; and they continually monitor goal and objective achievements. New venture development teams are wise to model their venture plan on these core concepts. The tools in this paper were designed to improve the outcomes of the business venture planning process.
The Role of a New Business Development Team Mentor
Experienced mentors can help innovators and entrepreneurs effectively and efficiently move their venture concept through the research, ideation, test, and planning stages to resourcing, launch, stability, sustainability, and growth. The role of a new business venture development team mentor is wide-ranging:
1] Mentor: experienced and trusted adviser (typically an unpaid, voluntary, part-time role)
2] Adviser: an expert willing to share their knowledge and opinions
3] Business Plan Editor: a mentor is best used in an editor role, rather than a writer
4] Voice of the Customer: keeps a light on the customer pain-pleasure spectrum
5] Voice of the Competition: ignoring the competition is never a good strategy, and there is always competition (alternatives, substitutes, replacements)
6] Voice of the Stakeholders: everyone involved with the venture must win
7] Voice of the Team Members: a balanced team is a productive team
8] Domain Expert: teaching from education and experience
9] Soothsayer: foresees the future based on experiences from the past
10] Angel Advocate: supports the team and venture, internally and externally
11] Consultant: professional expert advice (usually compensated to perform specific tasks)
12] Moderator: arbitrator, mediator
13] Coach: helps the team iterate and pivot as needed
14] Board Member, Director (not an ordinary role): helps govern the affairs of an organization
15] Teacher: instructor, guide
16] Innovation Stimulator: innovation is a continuing journey, not a destination
17] Collaborator: partner with the venture team
18] Friend: personal confidante and sounding board
19] Tool Technician: helping the team use the right tool at the right time for the right purpose
20] DXpedition Tour Guide: Discover, Define, Design, Develop, Deploy
The SLATE Mentoring Guideline
The US Small Business Administration SCORE program has a well-refined guideline for business mentoring, using the acronym SLATE:
S] Stop & Suspend Judgment
L] Listen & Learn
A] Assess & Analyze
T] Test Ideas & Teach with Tools
E] Expectations Setting & Encouraging the Dream
As important as what mentors do is what they do not do: they do not make decisions for the team.
Business Venture Development Tools
Focusing on the SLATE "Teach with Tools" element, there are a variety of business development tools that can be used to mitigate risks and optimize the probability of new venture success. (The author has a personal collection of over 400 such tools.) A good mentor can assist the venture development team with selecting and using the most effective tools for the business planning tasks at hand. For example, using proven checklists to assure the venture team addresses key factors in the planning process is a common and productive tool. Some checklists are very detailed and complex, others simple and direct.
The Innovation-Transformation-Achievement (ITA) Checklist Tool
Part of the theme of the Mentoring Institute at UNM 10th Annual Mentoring Conference (Innovation, Transformation, and Achievement) also provides an excellent startup checklist for business venture development:
Innovation] Do the product, service, process, and positioning innovations the venture is introducing to the marketplace match customer needs, wants, and desires?
Transformation] Are the transformation methods the venture will utilize to deliver value to customers effective and efficient?
Achievement] Are the key achievements of the venture (goals and objectives) being tracked such that critical operational methodologies can be continually improved?
Venture Mapping Tool
Simple visual aids, diagrams, flowcharts, graphs, maps et al are also excellent communication tools that help with seeing the "big picture". The Venture Mapping Tool in Figure 1 identifies the key elements that must be addressed by every business venture. There are four categories:
1] The Environment, Markets, and Customers
2] The Transformation Processes including key venture processes (Management, Marketing, Innovation Engineering, Production Operations, Sales, Accounting, and Finance)
3] The Resources available within the venture to power the Transformation Processes (People, Places, Things, Time, and Money)
4] Innovation Activities (Exploration and Ideation, Vision and Mission, Goals and Objectives, Strategies and Tactics, Tasks and Assignments)
Figure 1: The Venture Mapping Tool
The Critical Success Factor (CSF) Venture Mission Tool
There is a common Critical Success Factor (CSF) for every business venture: earn a profit solving customer problems with something new and better than the competition. Business ventures that fail can be readily diagnosed as not adequately addressing one or more of these nine core elements. A common failure mode is the lack of continuous innovation, not creating "something new and better than the competition".
Adopting this CSF as a starter mission statement for a new venture is a very effective tool for focusing the development team on designing strategies and tactics that will be of the greatest value. Figure 2 provides added detail for each of the nine CSF elements.
Figure 2: The Critical Success Factor as a Venture Mission Statement Tool
The Three Musketeer Hats Tool
Many successful new startup venture teams consist of three key people (humorously called "The Three Musketeers") working in harmony: the innovator, the entrepreneur, and the manager. The roles may often overlap. Sometimes team members describe their individual roles in terms of the "hat they wear" on a particular day. It is not uncommon for team members to "rotate role hats" from day to day. Figure 3 shows the primary function of each role and their relationship to the mission of the venture.
Figure 3: The Three Musketeer Hats Tool
The Hierarchical Output-Transformation-Input (HOTI™) Chart
Perhaps one of the most useful tools for in-depth business venture planning and development is the Hierarchical Output-Transformation-Input (HOTI™) Chart. It is very helpful for product, service, and process design. It is also particularly good for focusing brainstorming sessions for the creation of most any transformational system, from smartphone apps to cloud-based data storage to logistical operations flow to customer relationship management systems. In summary, the HOTI Chart highlights six system-critical categories: the environment, inputs, process, resources, outputs, and waste.
Figure 4: The HOTI™ Chart
The Venture Communications Network Tool
An application of the HITO Graphic Tool is in the creation of an internal venture communication network, how the functional areas of a business organization interact and share critical information. Figure 5 outlines a somewhat standard every-business-looks-like-this flowchart. Internal communication channels are numbered 1 through 6, communication channels between the organization and its customers are lettered A through E. Each of these network elements can be further detailed in a hierarchical manner using the HITO Graphic Tool.
Figure 5: Business Venture Communications Network Tool
The "alpha" communication channels
5 are external, between business venture departments and customers:
A] The Innovation Department communicating with customers to determine what customer problems, needs, wants, and desire the venture should address
B] The Marketing Department communicating with customers to promote current venture solutions, product, services, and processes that solve current customer problems, and obtain feedback from customers relating to the performance of the venture in solving their problems
C] The Sales Department obtaining and processing orders from customers, and customer relationship management
D] The Operations Department building and delivering solutions, products, and services to fill customer orders
E] The Finance/Accounting Department collecting payment for the value delivered to customers by the products, services, and processes provided by the venture
The "numeric" communication channels
in Figure 5 are internal, the information being shared between departments in a business venture.
1] Marketing and Innovation Development Departments share information about customer problems, needs, wants, and desires, and the benefits, fit, form, function, and features of new products, services, and processes being created in the organization.
2] The Marketing and Sales Departments coordinate information about the benefits, fit, form, function, and features of currently available solutions, products, services, and process that match customer requirements, including the price of the offerings.
3] The Sales Department communicates information about customer orders to the Finance/Accounting Department such that the customer is properly billed when the solutions, products, and services are delivered.
4] The Sales Department communicates information about customer orders to the Operations Department such that the appropriate products and services are delivered to the customer.
5] The Operations Department communicates information about product and service delivery to the customer so the Finance/Accounting Department can accurately bill the customer.
6] The Innovation Department (often called the Engineering Department) provides the Operations Department with bills of material and assembly instructions for creating the solutions, products, and services being sold to customers.
While there are many other useful tools, those outlined in this paper have proven to provide excellent results for a mentoring a new business venture development team.
The primary mission of a new business venture development team is to create an organization that will earn a profit solving customer problems with something new and better than the competition. Experienced mentors can help innovators and entrepreneurs effectively and efficiently move their venture concept through the research, ideation, and planning stages to resourcing, launch, stability, sustainability, and growth. There are a variety of tools that can be used to mitigate risks and optimize the probability of success. A good business development mentor can assist the venture development team with selecting and using the most effective tools for the tasks at hand when creating and implementing a viable business venture plan.
United States Small Business Administration (US SBA), Senior Corps of Retired Executives (SCORE). SLATE mentoring process. Retrieved from www.score.org
HOTI Chart™ is a trademark of Wencil Research, LLC. Used with permission.
[Presented at the University of New Mexico 10th Annual Mentoring Conference]