This Week on Survival Leadership

This Week on Survival Leadership
The Physics of Business Growth

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Thursday, April 2, 2015

Physics of Growth: FINAL Post--Portfolio Management

Managing the Growth Portfolio: As some learning launches show success, they will be entered into a portfolio of experiments—like a stock portfolio.  The manager might well balance these initially successful experiments in the portfolio as short- and long-term. Also, other criteria in balancing are: 1) Improvement initiatives (better, faster, cheaper); 2) New products or business models; 3) Acquisition (buying other companies or products).

Wednesday, April 1, 2015

Physics of Business Growth: Post #5--Learning Launches

Identifying New Idea and Learning Launches: “Creativity is a team sport.”  The two stages of creativity are discovery and development. Contact with customers is critical. To create ideas use: Challenging, connecting, visualizing, collaborating, improvising, reframing, and playing. Idea generation math: 1,000 ideas, to 100 experiments, to 10 initiatives that produce one or two successes! Experiment only on high potential ideas that create value, can be executed well by the company, are defendable from competitors and are scalable.  A learning launch is a low-cost, low-risk, small experiment to test a potential idea, collect data, and learn insights from the market. Analysis has dominated the process for change, and it’s caused as much paralysis as analysis and “the tyranny of ROI.” Large businesses stifle creativity by requiring too much analysis. Leaders need to allow, fund, and get out of the way of learning launches.

Tuesday, March 31, 2015

Physics of Business Growth: Post #4--Structure

Structure and Growth: Successful systems-aligned companies create innovative strategies, policies (especially HR), and cultures that are structured for change. Such companies celebrate success and “console” failure with lessons learned, ask questions, and are respectful, playful, open to new ideas, and curious. Best Buy serves as a good example with its innovative inverted pyramid—customers on top, employees next, finally servant leaders. Three approaches to innovative structure that promote growth: 1) Structure innovation initiative inside the company. Example: At Best Buy, the front of the house management is entrepreneurial and customer centric, but the back of the house is run by headquarters; 2) Segregate innovative initiative outside the company—like biotech where it may take years and cost a lot; 3. Build hybrids, like at IBM under Gerstner—Emerging Business Opportunities (EBO) to grow new opportunities that can become their own P&L organizations.  Engaged employees result from policies like promotion from within, good HR policies, perceived fairness in compensation and promotions, constructive feedback, equality, stock ownership and leader humility and stewardship.

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