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  • Customer: Choosing a right customer when possible…

    If there is a first point in the journey of any startup which I believe is worth celebrating, it is – when a customer sale has happens.

    If one is to make an analogy of startups to plants and their growth – this is comparable to the appearance of the first roots from the seed and penetrating the soil – there by enabling the plant to potentially grow utilizing the nutrients from the environment. Everything else, like raising an investment or finding a supportive supplier etc only enhance the likelihood of the possibility of growth – akin to application of fertilizers or support fences etc. The first positive sign a start up venture surviving the harsh environment and growing into a viable initiative is when the first customer sale happens.
     
    The start-up environment is extremely dynamic, and with many different growth avenues available, it is possible that start-ups could easily be confused about the way ahead. The newness of the start-ups enable them be easily mold them for good into a position they might not like to be in. While one could rationalize these as being defined by the market, I also believe there is a sequence which the entrepreneur could try before accepting being molded by market consequences than by organizational choice. I would love to believe that start-ups though liable to these are not as helpless in this pursuit, and there could be a better logic that product start-ups could benefit from.
     
    [A word of caution before I move further: what I say here might be most relevant to the high – technology focused product start up than others. But, I am confident that, over period as startups mature, they would like to get in to a position of advantage, and these suggestions would still hold at that point.]

    Quick and relevant learning is what I would call the Swiss knife that entrepreneurs should possess when they intend to build their venture. The skillful application of the Swiss knife and its various knives plays an important role in the start up’s survival. Given the relevance of learning, it is most apt to focus the start up’s customer acquisition and growth plans with a very strong base of learning embedded in it. This is also the underlying theme that I suggest in this blog, and also forms the source of some of the suggestions I make here. I also assume that most of the companies here are relatively growth oriented and building global products.
     
    Suggestion 1: Customers from a Developed/Advanced Nations
    High-tech product companies from developing countries who are interested in creating global products are better off focusing their efforts on acquiring customers from developed nations like the United States or the European Countries. This approach gets multiple benefits; some of them are listed below:
     
    a. Most developing countries have an ecosystem that is not completely ready for the products that these high tech start ups are offering. In such scenario, the growth oriented entrepreneur who often attempts to create something innovative, could be satisfied by making a product that satisfies the local need. (It is almost like believing that local maxima could possibly be the global maxima!)
     
    Move beyond the boundaries of the developing market and focus on competing in an international market. (Yes! I hear many start ups cry that they are constrained by the funding issues. But that need not be a limitation – you got to take the risk if you intend to really stay ahead of what is going to come). This could mean finding partner for the company in these advanced nations who could potentially make the product that is user ready!
    b. You could lead the change in the local market once you have a good base established – thanks to the difference in the exchange rates between the developed and developing nations. This could give you a head start and resources that help obtain a leadership position in the local market.
     
    One could often be blinded that, what worked in the developed countries could be easily applicable for the home market of the entrepreneur in a developing nation. Often, this assumption is way off mark – and being open to customization for the local market at that stage would be essential.
    Suggestion 2: Customers as co-producers

    Product development in most startups follows the vision of the entrepreneur, and if this doesn’t get aligned with to the realities of the commercial world – the focus could easily shift from having a useful product to just developing a product none could use for years.

    Involving the customer early is definitely a key to being able to break this potential trap and anchor the product development with the active involvement by the customer – almost like a co-producer! (At least some end user inputs would be available and thus provide some of the feedback necessary to develop the product further).
     
    The caveat in here is to realize when you are being completely held hostage to a single client. The startup would do well to being engaging with more clients of similar appetite and need once the product has reached a presentable stage.
     
    Suggestion 3: Create a good lead pipeline
    Quantify your customer goals in numeric terms. Goal setting plays a major part in actively pushing the teams towards listening and inculcating the actionable feedback into the development of the enterprise. 

    Creating a good pipeline that helps you reach the target set for the firm is a crucial for the survival of the firm. The dispersion in the kind of customers too plays an important role – else the experimentation that forms and important role in the early stages to find the apt customer segment and the value offering to the segment could be way off target and potentially lead to the demise of the firm. 

    The mix of leads in the pipeline in some ways should also be reflective of the product – features that you intend to test and validate. Focusing on the most active customer segment, and building a predictable cycle for the segment with good processes and delivery timeliness is the second major milestone after the first mentioned earlier in the blog.
    Last but not the least – always be open to change. At the beginning of this blog, we began by saying entrepreneurs need not be reactive always, they could possibly seek a clear advantage if they are proactive in their pursuit of opportunities – It is always possible that in spite of the efforts one would need to change the plans and get back to what could help survive. 

    Remember: The warrior who survives the day’s war – lives to fight another day!

  • Political Behavior in Organizations 4

    In the last byte, we began looking at the various influence tactics used by people. We continue this discussion in today’s byte.

    The following table adopted from the reference book summarized the various influence tactics.

  • Political Behavior in Organizations 3

    In the last byte, we looked at the use of political behavior. In today’s byte, we list some of the influence tactics.

    Influence as mentioned earlier, is the process of affecting the thought, behavior, or feelings of another person. This person could be a Boss, a subordinate employee or a coworker. If it is the boss – the influence s called upward influence; if a subordinate employee then a downward influence and it is the coworker – it is lateral influence.
    The most frequently used tactics are:
    • Consultation
    • Rational Persuasion
    • Inspirational Appeals
    • Ingratiation
    • Upward Appeal
    • Coalition Tactics
    • Exchange Tactics
    We shall attempt understanding these in the next byte.

  • Political Behavior in Organizations 2

    In the last byte, we looked at the definition of organizational politics and political behavior. In today’s byte, we continue the discussion further.
    By its very nature, politics is a controversial topics; and more so for the managers. While some managers take a favorable view of it, others see it detrimental to the organization. Some workers perceive their workplace to be highly political and find using political behavior very satisfying when they engage into it! These people would then thrive in such an environment. The other section generally finds the office politics distasteful and stressful. It is common to find that most people detect political behavior at all levels of the firm.
    Organizational conditions could also encourage political activity – unclear goals, autocratic decision making, ambiguous lines of authority, scarce resources and uncertainty – all these favor political activity!
    Political behavior in organizations could affect the organization very negatively when it is strategically undertaken to maximize self-interest.  That is, if members of an organization quite competitively pursue selfish ends – it is unlikely that the concerns of others are paid attention to. The workplace thus would be seen as less helpful, more threatening, and more unpredictable.

  • Political Behavior in Organizations

    In the last byte, we looked at Korda’s symbols of power and attempted to understand what each symbol represents. In today’s byte, we begin our discussion on Political Behavior in Organizations.
     
    Organizational Politics refers to the use of power and influence in an organization. The term of politics could have a negative connotation, but this is not necessarily true.
     
    Organization is a setting where people have competing interest, an effective manager would need to reconcile these interests. Thus the art of managing necessitates organizational politics. There are various tactics and strategies that could be used to acquire and expand power base. While some of these are sanctioned (approved by) in an organizational setting, there are others which are done without a sanction.
     
    Political Behavior thus refers to actions not officially sanctioned by an organization but taken up to influence others and thereby meet one’s personal goals. While in some cases, the goals could be aligned to team or organizational goals; in other cases, the personal goals and interests of others collide with each other; individuals pursue politics at the expense of others’ interest.

  • Power 12

    In the last byte, we looked at Kanter’s symbols of power. In today’s byte, we look at Korda’s symbols of power and attempt to see how these two are different. 

    Michael Korda uses rather unusual symbols – office furniture, time power and standing by as symbols of Power.

    Furniture gives an interesting indication of the power one holds. Ex: The size of one’s desk may convey the amount of power or, a rectangular (rather than circular) conference table could enable the most important person to sit at the head of the table.
     
    Time power refers to the use of clocks and watches as power symbols. Often, we find personal planners left open on the desk to display a busy schedule!
     
    Standing by refers to the obligation on people to be available (connected through internet, cell phones, pagers etc at all times so executive could reach them.
     
    An interesting definition of power by Korda is that – there are more people who inconvenience themselves on your behalf than there are people on whose behalf you would inconvenience yourself.
     
    While Kanter’s symbols focus on the ability to help others, Korda’s symbols focus on the status.

  • Power 11

    In the last byte, we looked at which sort of power would suit which kind of membership. In today’s byte, we look at Kanter’s symbols of power.

    Organizational charts though depict authority, generally do not tell much about who has power. One of the attempts to understand this was by Kanter. Kanter provides the following characteristics of powerful people in organizations.
    1. Ability to intercede for someone in trouble
    2. Ability to get placements for favored employees
    3. Exceeding budget limitations
    4. Procuring above average raises for employees
    5. Getting items on the agenda at meetings
    6. Access to early information
    7. Having top managers seek out their opinions
    We can clearly identify an active, other directed element of power in all the above. One could use these symbols to identify powerful people in organizations.
    Aligned to this, Kanter also identifies some of the characteristics of powerless people. One way to overcome powerlessness is to share power and delegate decision making authority to employees.

  • Power 10

    In the last byte, we looked at the power analysis by Amitai Etzioni. In today’s byte, we look at how the type of organizational power should be matched by the membership in the organization in order to achieve congruence. 

    In an alienative membership, members have hostile feelings. In such scenarios, coercive power is the appropriate power type to use.
     
    In calculative membership, analysis of the good and bad aspects of being in the organization. In such a scenario, it would be good to use a utilitarian or reward based power would be appropriate.
     
    In a moral membership, people possess a strong positive feeling. In such a scenario, normative power is the most appropriate.
     
    The following table summarizes the choices.
    This analysis emphasizes that the characteristics of an organization play a role in determining the type of power appropriate for use in the organization.
     
    This theory is however also controversial as this suggests the use of a single type of power in any organization.

  • Power 9

    In the last byte, we looked at the intergroup sources of power. In today’s byte, we look at concept of Power in a slightly different context.

    Amitai Etzoni looked at power from a sociological orientation and developed a theory of power analysis – that identifies three types of organizational power and three types of organizational involvement; which lead to either congruent or incongruent power uses.
    The three types of organizational power are:
    • Coercive Power – influencing members by forcing them to do something under threat or punishment
    • Utilitarian Power – influencing members by providing them with rewards and benefits
    • Normative Power – influencing members by using the knowledge that they want to belong to the organization and by letting them know that they are expected to do the right thing.
    The three types of membership are:
    • Alienative Membership – the members posses hostile, negative feelings towards the organization. They do not want to be there. Ex: Prisons
    • Calculative Membership – the members weigh the benefits and limitations of belonging to the organization Ex: business
    • Moral Membership – the members have positive feeling about the organizational membership and could also deny their own needs. Ex: an NGO working for better health etc.

  • Power 8

    In the last byte, we looked at the positive and negative faces of power. In today’s byte, we look at intergroup sources of power.

    Teams in organizations derive their power from either of the 2 sources:
    • Control of Critical resources
    • Control of Strategic Contingencies.
    Strategic contingencies refers to the activities that other groups depend on in order to complete their tasks.
    Strategic contingencies could arise from any of the three factors:
    1. ability to cope with uncertainty – a group’s ability to help others deal with uncertainty
    2. high degree of centrality – the group’s functioning is important to the organization’s success
    3. non substitutability – the extent to which the groups function is indispensible to an organization example a very specialized experience.