Schlagwort-Archive: Viability

The effect of single headedness

Companies that cross the Dunbar number of 150 employees should find ways to spread their leadership across several shoulders to escape single headedness. As long as you can are below this limit, those involved are at eye level – everybody knows everybody; member opinions and suggestions are considered; flat hierarchies and short paths enable agility. Multiple top decision-makers are more likely to create a confusing mess and a lack of settings rather than a clear direction. However, with thousands of employees, one-person leadership becomes a bottleneck. Corporate icons such as Steve Jobs, Bill Gates, Elon Musk, Larry Ellison, Jeff Bezos, have above all a marketing value. They cannot take care of everything, nor are they able to guarantee the coherence of their decisions. Besides, not only their workforces but also the network of affiliated partners depends on their mood. Not to forget the shareholder that buy and sell their shares depending on public statements. Jeff Bezos, for example, has pointed to the natural life span of a company of 30+ years, to derive from it the end of Amazon that is approaching that magic limit.

In doing so, Amazon is continuously opening up new business fields (e.g., any kind of media, platforms for third-party providers, Web Services), whose viability should be safe as long as we have the WWW. But even such big owners are not free of the faith in fate. A conscious look in the mirror could bring their weaknesses to light.

  • The missed transition from growth to viability
    Amazon has proven that growth pays off in the long run. In almost thirty years, the increased revenues have been used to expand the company. Since 2017 alone, sales have quadrupled to nearly US$12 billion. However, Jeff Bezos seems to have knowledge that shows him limitations; otherwise, he would not be singing the swan song. Although this is not so much about the end of Amazon, but the end of growth. As a single-minded decision-maker, he has the opportunity to lead his company into longevity by switching from growth to viability. Growth serves shareholders. Viability serves the customers, who, in return, provide the company with income. If the customers are not disappointed, they will stay loyal and hardly switch to a competitor. Disappointment occurs when the deliveries are faulty, or others provide better offers.
    Keywords of viability are a demand-oriented variety of action, pleasant customer experience, self-organized workforce, sustainable business models, Win-Win supplier relationships, and consistent value practice.
  • Inability to meet his social obligations
    Globalization has fueled the business models of the Internet. However, companies like Amazon are using the lack of a world order to evade social responsibility. For-profit interests, revenues are channeled in such a way that they avoid any taxes. National politicians bear a considerable share of the blame for this, as they fail to set short-term barriers to such attempts or even create actively tax havens to attract companies. Understandably, companies make use of these offers – it is only immoral and not illegal. However, in the long term, they do themselves harm, when people boycott this business practice, at the latest when other providers offer similar deliverables and behave more responsibly.
    Keywords of social responsibility are Corporate Social Responsibility (CSR), Psychological Safety, Psychosocial Safety Climate, Compliance.
  • Lack of imagination about the future
    The adherence to a particular way of running the business is due to the current workload and the usual routine, as well as often to the lack of imagination of the single-headed leader. Presage the end of a business is not a wise prospect but a sign of a lack of vision. Consumption via the Internet has virtualized the business world forever – at least as long as there is electricity and the Internet. Shops are now webshops. Marketplaces are now platforms. Technical discussions are now online forums. The reach of business spans the globe – even if some webshops continue to address a LOCAL, SINGLE LANGUAGE market (a clear sign of the beginning of the end). The question must be now: How will the virtual shopping street evolve? What can I do to stay ahead? What are the critical influences? These questions overwhelm a single-headed leader. It requires certain people (employees and managers), who are willing to experiment, to try out as many things as possible, and to bring viable ideas to market.
    Keywords of the imagination are Learning organization, Design thinking, Experimentation, Hackathon, FabLab, Business exercise, Lateral thinking.
  • Inner resignation of the driving force at the top
    The greatest threat comes from one-headedness is the dependence on the daily mood of the icon. In extreme cases, morale can slip away for a long time, which then leads to clumsy and defeatist utterances. As a result, the mood is intensified by a persistent vicious circle that leads to rampant instability. The ability to fulfill a timely leadership transfer that strengthens the company in the long term is the icon’s final primary task. At the same time, the handover offers the chance to overcome the one-headedness. Bill Gates has missed this opportunity, as he did not turn Microsoft into a common, but by passing on the baton, he has underlined the previous. Jeff Bezos has the chance to turn his global consumer network into a public marketplace that puts customers first, not shareholders. However, with his swan song on Amazon, he has instead shown that in his imagination, he has already reached the plateau, and that from now on, things will go downhill. This inner denunciation is fatal.
    Keywords of self-management are Self-image, Mindset, Self-understanding, Expectations, Strategy, Vision, Intention.

Bottom line: Everyone talks about agility, holacracy, and networks – however, the management levels exclude themselves from these discourses. Teamwork is crucial, especially at the level of the leaders. To hang by the silken thread of a “genius” is one of the most significant risks for all companies with more than 150 employees. Examples can be found in small and medium-sized companies as well as in the GAFAs (Google, Amazon, Facebook, Apple). Our example is Amazon, which fails to make the transition from growth to viability, which fails to meet its social obligations, offers no vision for the future, and is led by a mind with apparent self-doubt. The way out is a management team with equal partners who complement each other. This avoids the effects of one-headedness.

Tasty bait for the fish

Most of the time we are all customers. Nevertheless, it seems to be hard in business to leave the own view, the provider view, and switch to the client standpoint. As a consequence, the offers are treated from one’s own angle. Unfortunately, customers are only secondarily interested in the suppliers and how they intend to make the customers happy or which customers they already have. First and foremost, the clients use their own vantage points to check the proposal. These glasses not only filter out certain aspects, but they also act like blinders that only allow seeing a limited section of the picture. Suppliers should always keep these views in mind, when preparing their quotation – in the end, the bait must taste to the fish, not the angler.

Let us look at the important customer glasses.

  • What it is all about
    If only the deliverables were offered that have always been available, only a little better, then marketing would still be promoting fist-wedges. The changes that brought Gutenberg, Benz, Jobs or Hopp et al. to the world were not directly understandable to the people. Printing, Automobile, PC and Standard software were disruptive paradigms, which only became visible over time. The customers are occupied since always in favor of their own core business and have little time to invent innovations from outside of their field. This is another reason, why they turn to external suppliers. However, customers need proper explanations of the topics, goals, functions, and the meaning of the solutions for their business to spark their interest. The argument “They know that” increases the probability that others will win the contract.
    Fundamental aspects should never be assumed but be explained in a way that suits the target group.
  • What makes it attractive today, and in the future
    It is possible that an bidding attracts the attention of the public especially through its mystical innovations. Just think of Andreas Pavel, with his patent for a “body bound small system for the high-quality reproduction of audio events”, which liberated the stationary music experience. Who would have asked for a Walkman in a hi-fi store? There are the factual and emotional reasons that irresistibly attract customers – i.e. the functionality offered, the ability to integrate into the existing landscape, the ease of use and support during application, as well as references from existing customers and, above all, the design of the quotation.
    Even if the factual arguments seem to be in the foreground, the gut feeling determines the outcome. The look through the customer’s glasses shows the components that make the customer curious and that should be particularly highlighted in the proposal.
  • Why it is viable or not in the long term
    The long-term viability of the offered deliverable plays a major role in the evaluation by the buyer. The reliable deliverable delivery is the focus, especially under the specific conditions of the customer. If limits to endurance arise, fitting expansions should ensure long-term use. Since most of the building blocks are not set up on a greenfield site, connectivity to the existing building blocks must be ensured. There is no point in advertising connections that are not required by the respective customer. These criteria apply not only for the moment of introduction, but also in the future for operation and final disposal.
    The bid should be tailored to the customer’s particular circumstances. It guarantees the completeness, increases customer confidence and thus long-term customer loyalty.
  • What has to happen to be feasible
    Since not all circumstances are known in advance, the requirements for use should be clearly described. 1) The employees should be able to master the new. Remember the introduction of PCs. At that time, the problems did not start with the business application, but already with the new input device, the X-Y position indicator for a screen system – later called mouse. 2) The infrastructure must be able to accommodate the product – it must be shippable and have sufficient space and connections. 3)Geographical and cultural specifics must be considered – e.g. different languages, and culturally determined controls.
    Customers honor it, when their general conditions are recognized and considered – or at least the premises are clearly described. For this reason, the known guard rails should be mentioned, and requirements should be clearly indicated. If the quote does not fit, sooner or later the missing feasibility will become visible anyway.
  • Which expenditure is necessary in total
    Once you know the proposition, it is worth to take a look at the required effort. What does it cost? What has to be spend for the introduction? How much does the operation cost? And what does the maintenance require? It is all about the necessary finances, the time required, which can lead to delays in daily business, and the necessary personnel (internal/external). The available resources should be determined where possible or at least accepted in order to prepare an adequate tender. A low price with a much lower performance is always worse than a high price with a much higher performance. If the planned effort of the customers is not known, at least the required outlay should be clearly shown. The customers can then decide for themselves. Suppliers, who do not disclose their cards, will lose out in the long run.
  • What speaks for or against it
    Helpful customer glasses convey the expected advantages and disadvantages. These can also be inquired or anticipated in order to adjust the proposal accordingly. The customer-related business case, where all components are listed and evaluated, provides the relevant aspects: e.g. cause of the enquiry/ reasons for the project; action alternatives; expectations concerning benefits, risks, costs, and time frame. Various scenarios ensure that other important solutions are not overseen and excluded from the outset.
    The customer should be enabled to evaluate the advantages and disadvantages not only on the basis of calculations but also from an emotional perspective. The determination of the expected pros and cons helps in understanding the customer.

Bottom line: The different types of customer glasses provide the supplier with the key points on which the proposition is based. The individual customer does not need all these views. If you know the needs, you can adjust to its own point of view. Which perspective is decisive for the customer’s purchase can only be seen afterwards. In summary, the customer should understand the purpose of the offering, it should be attractive, usable in the long term, feasible with the existing conditions and provide more advantages than disadvantages. You do not sell the deliverable that you prefer as a provider, but the one that the customer likes. The bait does not have to taste the angler, but to the fish.