Functioning as an Entrepreneur within an Organisation - Deji Fisho

The 'Intrapreneur'

FUNCTIONING AS AN ENTREPRENEUR WITHIN AN ORGANISATION

 

Intrapreneurship is the practice of adopting and using entrepreneurial skills and approaches within an organization. This means using new methods, learning from setbacks, doggedly seeing projects through, and eventually transforming them into profitable ventures. Although the concept has been in practice for several years, it has now become increasingly relevant, given the need for one to add value to one’s job, as well as change with the times.

Today, work is increasingly about innovation and doing things differently to satisfy the customer base. Dull repetitious jobs are being replaced by machines and computers, leaving only human aspect to dealing with the shifting desire and needs of people in a world of rapidly emerging technical possibilities. In present day Nigeria, the more forward thinking and innovative Banks, virtually have whole branches run by machines. A lot of good jobs available now, require imagination and getting things done differently. Traditional bureaucratic expertise is not enough to achieve the rate of innovation needed to compete. What is required

is the skill of the entrepreneur? Below are attributes to achieve this:

 

MANIFEST THE ‘CAN DO SPIRIT’

People will follow the guy who is sure, and looks like he will win. You must be passionate about your project and wear it on your sleeves. Also, gain a deep understanding of what you want to achieve, demonstrate confidence, then go on and make it happen.

Image: shesugar

Image: shesugar

 

GET YOUR BOSS ON YOUR SIDE

It makes your work easier if you can get your boss to support you. But before you ask your boss to spend precious political capital on your behalf, ask yourself if you have made the job as easy as possible.

When your boss requests project resources from someone in another area, it’s going to be easier if you have pre-sold the idea to people who will do the work. Have you converted those people to your cause - are they supportive?  Getting someone to lobby others on your behalf may be part of the solution, but it is not the place to begin.

Image: deltaquest

Image: deltaquest

 

PAINT A GOOD PICTURE; BUT ONLY SO FAR

It’s tempting, when visualizing the positive impact of your project, to tell the world about it, but the effect of your excitement may scare people. If, in its fully realized form, the implication of your project would change everything; the department, the job and the comfort of familiar ways of doing things, then you cannot blame people for being cautious.

If your project seems “too world-changing’, people tend to  respond with delay tactics and request for more information, rather than action or help.

 

ASK RESOURCE OWNERS FOR ADVICE

The danger of premature glorification is neatly matched by the danger of premature request for resources. Ask too soon and there is a good chance you would get some version of “No!” Once someone has denied you resources, rationalization sets in: if they refuse to provide resources, then your idea must be bad. If it was good,  they would have found a way to help.

 

This vicious circle of rejection can easily be turned around. Simply ask for some form of help that would not be refused. The request for help least likely to be refused is a request for advice. When someone gives you advice, they are contributing to your project. If they contribute to your project, one of two things must be true:

1. Your project is worthwhile, so their helping makes them good managers.

2. Your project is worthless and destructive, in which case helping is a poor use of time, and they are a poor manager.

 

SAY THANK YOU; EXPRESS GRATITUDE

Gratitude cements the value of what ever help you have been given, and can even erase hostility when assistance is sought again. When someone in a position of power criticizes the project of an intrapreneur, the intrapreneur takes good note; after some time and with a bit of dispassionate appraisal, the intrapreneur would find truth in some of the criticism. In some small way the plan is changed. The Intrapreneur now goes back to the critic and thanks him or her for identifying a problem that could have sunk the project. “Without your help, we might have…”

Your critic may have defined himself or herself as your enemy but you have reframed the criticism as a form of support. To balance things out they rationalize that there must be some good in your project. Few people can not resist the praise, if it is delivered with total sincerity. Thanking critics for their contribution sincerely requires the generosity of spirit to genuinely forgive and appreciate.

Image: bodyjournal

Image: bodyjournal

 

WORK IN CONCERT WITH OTHER PEOPLE; BUILD A NETWORK

Someone once said that man’s best possibility for self expression is with other men. Gone is the era of the lone ranger. The intrapreneur knows that when you are not in charge of what you need, your success depends on the quality of your relationship with other players. He is always alert to the feelings of others and distributes credit widely. “The more you give away, the more come back in the long run”

The Intrapreneurial warrior keeps members of  “the coalition” fully informed, takes time to check up on everyone, and keeps relationships alive even when there is no immediate need for help.

 

BROADCASTING YOUR IDEA

It seems smart to “run your idea up the flagpole and see who salutes.” It makes sense, but it doesn’t work. Every innovation involves a bit of creative destruction; the new way replacing the old. Those who will benefit from the new order don’t really anticipate the implications of the change; and those whose privileged position could be challenged by the new order recognize this immediately, and come forward with their spears sharpened in opposition.

The lesson is this: Premature promotion of your ideas triggers the immune system. The grander you make your idea sound and the more widely you distribute it, the more people it will frighten.

 

STICK WITH YOUR PROJECT THROUGH THICK…

 

Every innovation passes through dark and discouraging days.

 

Intrapreneurial challengers don’t give up easily. They find ways around obstacles and will not buckle under stress.

Image: assets.entrepreneur.com

Image: assets.entrepreneur.com

 

There are fake intrapreneurs who only want to head large projects with an impressive staff roaster. They jump from project to project depending on what is in favor. If the project hits a snag, they blame others and move on.

True intrapreneurs, like entrepreneurs, find the capacity and grace to stick with a project until it succeeds.

 

Deji Fisho

 

Reference:

•        Intrapreneurial Warriors Versus Traditional Managers: Giford Pinchot

•        Creating an Entreprenuerial Mindset: Rita Gunter Mcgrath & Ian C. Macmilan

 

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TSH ARCHIVE

The Secrets of a Successful Entrepreneur

The word entrepreneur is so regularly used to imply a business-person. Indeed it is simply a person who turns an idea into profitable income. Being an entrepreneur requires sound thought processing; positive thinking is critical because there are so many challenges ahead of him.

He must exercise many virtues, including self confidence, focus, fearlessness, and consistency. His plans must be accompanied by a reasonable level of ambition; this is the driver and motivator of his goals.

He must want to achieve something!

Let's see some secrets of a successful entrepreneur.

Attitude.  You cannot afford to engage your business with a bad attitude. You must be mannered and cultured to sustain your business, and indeed all relationships. Degrees, qualifications, or wealth cannot work for you in this instance.

Image: lionessgiveaway

Image: lionessgiveaway

Entrepreneurs must be Responsible. Learn to acknowledge when they are wrong, and make corrections without taking offense when mistakes are pointed out to them. They should be able to completely bear the consequences of their actions, without passing the buck. They should also be the first to identify and accept the company’s flaws or weaknesses, while enhancing the company’s strengths.

Take responsibility (on behalf of the actions taken by your staff or team, when necessary), and don't make excuses.

You should be Principled.  A good entrepreneur should be known to have integrity. Your word is your bond, and what you say is what you mean. Do not run around compromising your position and beliefs. When you believe in something, stand firmly by it. Loyalty is a true test of how principled a man is. It only takes a short while for people that are successful through bad means, to hit the rocks, and they surely do. What you sow is absolutely what you reap.

Be Open and available to counsel and advice. You must be receptive to new ideas and others ways of doing things. You must be approachable. Sycophancy from 'loyal' staff, relatives, and friends must not be encouraged in your business; they mostly cut you off from reality.

A good entrepreneur should be in touch with the immediate environment in which he operates. He needs to meet people, get feedback from his products, and listen for new ideas.

You can't be too busy to be in touch with your customers. Be on the frontline occasionally, answer telephone enquiries, and read the mails - you will be directly in touch with the truth, and the outcome of your labor, and of course, first hand feedback. This helps you to be prepared for increased demand and to spot problems early.

The good entrepreneur should talk less and listen more. His opinion must not always top the chart; this only leads to loneliness, because people stop trying to get messages across. ‘He is Mr. Too-know’ always on top of everything; he never needs advice.

He should form associations and attend events that enable him meet and interact with other entrepreneurs and professionals. The intention here is to network, brainstorm, share experiences, and ideas.

As much as entrepreneurs should be open and receptive, they should also give; share their knowledge, experience – tutor and mentor others, especially the youth.

Knowledge and information should not be hoarded. The more knowledgeable and successful people in a country, the better for the economy.

Good entrepreneurs are also truthful about the position of their businesses, especially with their staff members. They are open about the financial strength, weaknesses, challenges, and threats. They also express to each staff, their assessment of the staff’s work in a professional manner.

Image: penzcame

Image: penzcame

Passion is the strongest driver of an entrepreneur, because it is the only factor that sustains a person through thick and thin. Your entrepreneurial passion is often adapted by your team members, which in turn assists them take the company to your dream place. It does not allow you to give up either; it fuels you to keep moving, even in the face of diverse adversity.

“You can’t be passionate without loving” – Dayo Olutayo

You must love what you do to be passionate about it. It is the intense love that brings about passion, and passion is attractive, it attracts your customers too! Passion then seeks perfection and excellence. You strive to produce and present your product in compliance with global standards. You ‘inch’ your way forward always. When your team knows how passion and excellence driven you are, they will comply. Although, most may not be able to cope with working with you, you will find people of like minds. It is common that employees especially complain about their ‘perfect’ bosses, saying things like, “nothing I do satisfies him”, but this usually applies to lazy, un-trainable people. Let them go! Everyone is not called to serve, or work with you. Let them go when they have to!

 

Versatility & Flexibility are important attributes of a good entrepreneur; he should be ahead of his ‘game’. There must be alternative plans all the time. There are several factors that affect the plans and programs we make, but the ability to react positively in the event of hiccups is want keeps your head above water. Believe in plan A, have confidence in it, but be prepared with a clever plan B, and C. When you practice this long enough, you will almost not panic about anything. You will so naturally carry your team to the next plan. A confident, brave, and composed leader would keep up the team spirit through challenges. Some of these challenges may be opportunities for change to a better, greater level. Embrace it!

Image: peopleculture

Image: peopleculture

Never give up. Resilience is important when you dwell in a region like ours; where de-motivators are a constant, and basic necessities of life are not in place. Many people give up just at the verge of breakthrough. Most businesses fail between three-four years from start date; however, businesses that have endured beyond then, usually succeed.

 

Ref: Entrepreneur – Steve Parks

Toyin W. Oke

Publisher, The Street Hawker

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‘No Credit Today, Come Tomorrow?...’

When done professionally, extending credit can be a boon to business. It is a disadvantage if a business does not offer some form of credit. Tough times are precisely when business owners begin extending credit to lure customers that are reluctant to part with cash. Some customers will owe and probably never pay. This can push businesses dangerously close to the edge, and business owners can find themselves so consumed with collections, they are left with little time for their business.

image: packman

image: packman

Establishing & Extending Credit Terms

Extending credit to customers is a fact of business life. It is necessary to figure out how much a business can afford to tie up in accounts receivable without losing sleep. It is a big mistake not to create and follow strict credit policies when extending credit. Thus, it becomes very important to decide who gets credit and who does not, as well as adopting a policy for evaluating credit risk and establishing credit criteria.

Unfortunately, not all customers pay on point of sale. The customer who makes a significant purchase may require extended purchasing terms. Even on those extended terms, customers may pay late because they know they can – this is because you are essentially lending money to your customer, and this increases the cost to your business. Not every purchase will require a credit application. The different types and levels of risk associated with customers include; Extended terms, late payment, non-payment, partial payment, and discount for early payment.

It is important therefore, to understand what type of customer you are dealing with, if they are cash customers or not. This means you will know the ‘full cost’ to your business when you decide to make the sale. A customer who requires extended terms and pays on time is predictable and reliable within the terms extended. The business' extra expense is the financing required to meet its own cash obligations or missed opportunities to use those unavailable funds during the longer collection period. The business knows, however, the cost of doing business with this customer.


A customer, who accepts terms, then pays late, burdens the business with the uncertainty of when the payment will be received. If the customer is consistently, ten days late, then the business may be able to change the timing of cash inflows; but if the customer is unpredictable in being late, then uncertainty increases, which is signaling a more dangerous risk – default. If your business has enough advantage to collect, financing charges may be an incentive to change customer behavior. If you cannot collect them, adding finance charges to the bill will demonstrate your awareness of the issue and that nonpayment is not acceptable. By doing so, you are signaling that the terms remain those agreed on. If you have to pursue legal action at some point, then you have documentation that you were enforcing your terms and conditions.

Partial payment is perhaps the most difficult to address because the customer is making limited payments of some amount, just not the full amount. This is not completely good, not completely bad - the type of prospect you hope to screen out or provide cash-only terms. Regardless of the terms, it is proper to ask for an advance payment; this insures that the buyer is serious and that the business actually has some revenue.

image: cmsmarketplace

image: cmsmarketplace


Discounts for early payment, especially for cash, are incentives to customers to pay earlier in exchange for paying less. You may offer 1 – 2.5 percent discount (depending on volume) for cash or for payment within 10 days of purchase. Incentives of this type recognizes the financing aspect of extending credit to customers. Customers will utilize most of the credit options available to them.

Circumstances change. The credit policies you have in place today and the terms you extend to each customer will undoubtedly change because circumstances change. Recognizing when customers’ purchasing patterns and payment habits change is part of managing credit terms, by extension - cash flow; then it becomes important to review credit policies and the activity of each customer periodically. It would also be wise to utilize account receivables, outstanding balances, and reports by customer to understand how accounts receivable - management practices are working. It is smart business to understand that you may have to offer certain terms to customers because of industry practice, or because your competition does. It is critical to your business to understand the full cost of those offers on your cash flow and profitability.

Progress payments are also a way to ensure that you are not open to financial risk. The key to successfully securing progress payments is to prearrange your payment terms. Agree on what percentage of the amount due at various stages. Alternatively, you may arrange for progress payments based on indicators that are relevant to the specific scope of work, the job, or the services provided. Regardless of the system, progress payments on larger jobs can dramatically lessen exposure to financial risk.

If, extending credit sounds iffy, consider offering credit through a third party, such as partner banks and other financial institutions; thereby transferring the risk, and allowing the real lenders do what they do best. Nevertheless, the onus for collecting is off you, its fewer headaches, little or no paperwork.

 

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Death of a Brand 1

A brand is simply a promise kept.

There are many ways to kill a brand, business or even relationships. Here are a few ways to put an end to a potential 'good thing':

Promise &  Fail

There is no need to promise what you can not deliver. It is always better to 'under-promise' and 'over-deliver'. That is to give more than is being expected, rather than give below your promise or pledge. Many companies fail to deliver on their promises; this is the major cause of the death of a brand. During marketing campaigns, promises are made, and soon after, they are gone with the wind. Some companies receive payments for goods and services without any after sales help or support. 

Image: kimberleeconwayireton

Image: kimberleeconwayireton

Non-Effective communication or No Communication is a Rapid Brand Killer.

You must acknowledge and reply your mails, messages, and telephone calls promptly and communicate clearly, stating your terms and intentions in simple terms, and facts that they must know in the course of the transaction.

Globally, it is expected that you reply mails within 24hrs, because technology has made it so easy to communicate, anything less gives an impression that your company does not deal with business promptly.

Image: Lifehack

Image: Lifehack

Bad Brand Managers/Representatives

People that make brand management decisions may cause the untimely death of a brand. Getting the right person to manage your brand is as important as the people who work for your company. Your staff and everyone associated with your brand must look like your brand; they must be able to represent your brand values.

Bad Quality

Your brand must represent good quality and positive attributes, i.e good products and services.

No Online Presence/Advertising

Do not fail to advertise. Advertising does a lot more than turn in revenue, it keeps your brand in constant touch with its consumers. Stengthen your online presence; social media is not avoidable. 

While there are times when a brand must be put to death, there may be no need to kill a potential or thriving brand.

Look out for other factors that may kill your brand in Death of a Brand 2...soon.  

Give Your Brand Life!

Toyin W. Oke

Publisher, The Street Hawker

 

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Respect Your Hustle - A Letter From Ebuka

‘No One Values What They Don’t Pay For’

A Letter from Ebuka

 

Dear Professionals,

 

Why do you find it difficult to put a value on services you render?

Many doctors and lawyers who are close friends of mine struggle with the reprehensible fear of charging family and friends for their services.  

These are young professionals just starting out in business; consultants, coaches in different fields. There should be a value placed on your time Sir!

People only value what they pay for! Call it a powerful placebo. 

Even a subtle lack of self-worth is enough to put you at a disadvantage in a sales-conversation or negotiation, thereby discounting the idea of payment for your services in the mind of your friend-turned-client.  

Yes, a discount is okay, but a generous discount will water-down the value of your service.

The value of your service charge is the accumulation of concerted efforts, years of experience, and knowledge acquired through hard-work, study and talents.

Image: mikkomi

Image: mikkomi

Come on, your friends pay their mechanic to take a look at their car engine, their barber for a hair-cut, the costermonger who sells fruits and vegetables, and so on.

Why should you not be paid? Though generally people are more reluctant to pay for intangible goods and services.  

Your expertise, skills, or talents are not free!

Show some respect for what you do. And others will respect your hustle. 

Speak about work with more confidence and pride. And those kind of emotions are infectious and cause even more sales, and referrals.

Respect your hustle.

Yours,  

Ebuka J. Anichebe

Business Strategist

www.askebuka.com

Make Your Life a Blockbuster!

 

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Blunders You Must Avoid in Your Enterprise

Certain blunders should be avoided by entrepreneurs in the quest to stay afloat, perform and grow in an environment so bumpy for businesses, a few are:

  • Poor management of credit especially those granted by banks
  • Diversion of funds generated by the company
  • Wrong perception of the human capital
  • Lack of focus
Image: wealthresult

Image: wealthresult

Poor Management of Credit - This concerns principally the short, medium and long term loans/credit extended by banks and related financial institutions.  In truth, almost all businesses require one form of credit support or another at different times in the pursuit of business goals. The critical issue is the attention paid to the obligations entered into by the company and her directors in relation to the credit (the repayment at due dates), and indeed other requirements agreed to; for instance not to over-commit the enterprise in one way or the other.  Consider the common behavior of many entrepreneurs after obtaining bank loans. Many go to sleep practically, after obtaining the credit while some apply the related fund in extraneous purpose(s) far from the primary intentions.

The consequence? Inability to generate the needed cash flow to service the loan as agreed originally. Then the bank starts mounting pressure and things could many-a-time begin to fall apart. The best approach is to stick to the plan intended; apply the fund into the business, strategize and direct the enterprise aright. Diverting funds generated from the buoyancy created through the credit, due basically to indiscipline on the part of the business owners. Many entrepreneurs are so daring that they care less about the consequence(s) of not meeting the required obligations to the lender. Entrepreneurs should appreciate the position of lenders; they too are in business and would charge interest and compounded charges and at due dates. A loan not serviced is catastrophic.

Diversion of funds generated by the company - The reckless use of company funds for personal purposes. Consider the common use of the money generated from receipts (even when no one has yet computed the profitability status of the company or project). Many simply squander corporate funds on self aggrandizement programs - purchase of luxury items, travels, lavish parties, support for political agendas and so on. The enterprise thereby becomes de-capitalized. Capital indeed could be very difficult to build and even if you are lucky to hit ‘gold’ at sometime in the company’s life, such should be conserved since as is normal, the dry season would come sometime sooner or later.

Image: ndebted

Image: ndebted

How do you Perceive the Human Capital? How do you perceive your employees? Are they basically similar to other resources that you purchase in the market place?

Human capital should be appreciated as an extraordinary kind of resource. The difference from other production inputs stems from the special attribute possessed, since they certainly can individually and collectively change the status of other inputs within the enterprise.

Employers should appreciate the extraordinary capabilities of the employees, especially when they are very productive. In bizarre errors, some employers regard their employees as materials to be requisitioned for, paid the wages and be discarded when no longer required. You need to appreciate your employees, challenge them and extract the best of their contributions. This can be possible through paying attention to their individual circumstances, engaging them individually by discussing their situations informally. Sometimes you may invite them to lunch or dinner at which time official, unofficial, and personal matters are discussed. Such is closely related to the concept of 'Managing by Walking Around'. Take two or three of them out at a time and let them know that you care. The result could be amazing; for instance negative attitudes (where this exists) starts getting replaced with an amazing spirit of (unusual) commitment to corporate goals. For example, they begin to demand difficult terms, such as higher pay, loans/advances; You need to explain the company’s situation, so they appreciate that they would reap better conditions based on improved performance. However, they should indeed partake in the bounty of the enterprise brought about by their sweat, whenever the business performs well; as the adage goes, "shared pains should translate to shared gains". At the end, the philosophy should be, employer – employee partnership; the type that yields a strong and perpetual bond. 

Lack of Focus has led to low performance and business fall in many instances.

How many lines of business do you handle?

Do you regard virtually every business opportunity as desirable, and therefore, spread into multiple lines?

Of course any entrepreneur engaged in various businesses should be careful. Almost all successful entrepreneurs began with a single business line, and then become competitive, building strength at it before going into the next line of business.

Lashing in multiple directions certainly has its pitfalls. For instance, how far can you spread yourself into the various businesses? Yet your eye and personal involvement is very crucial for effectiveness to be achieved. You’ve hired the managers but managers do not often respond with the same alacrity as the entrepreneur. Moreover, spreading yourself thinly into many different (sometimes unrelated) lines can only reduce your effectiveness. Then consider the stress and the possible effect on your health.

Spreading the scarce capital thinly among many enterprises can also lead to poor performance. Why not deepen your activity in the business that you have chosen, excel in it, be competitive and become the very best in the industry. The above assertion does not however stop you from branching out into a closely related line where you indeed reap the benefits of synergy; you obtain 5 by adding 2+2 for instance through the sharing of overheads among two, three or more business activities. Entrepreneurs are therefore admonished to concentrate especially during the start-up, when your business is akin to a baby or toddler that requires intensive care. You need to be able to walk before being able to run otherwise you may fall.

Bioye Akinfolarin

Author – Comprehensive Enterprise Management

 

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The Innovation Process – How to Embrace the New, While Reforming The Old

The Fuel of the 21st Century Entrepreneur is innovation. An enterprise in slumber will eventually be among the back benchers, assuming it does not become extinct. Innovation is the key to sustaining and growing a business.-TSH

What are the imperatives for managing an enterprise particularly the SME in the light of multidimensional inadequacies and frequent difficulties (competition, economic, social, political etc) in our environment for instance?

When you consider the battle for survival that the SME is daily involved in, the issue will be appreciated. It has been stated by researchers that as many as 9 out of 10 new SMEs die at infancy (within the first three years). Indeed, SMEs operate under an extremely tight and competitive operational environment. The above scenario therefore lends credence to the idea that only the innovative enterprise will endure and grow.

The Concept of Innovation

As one of the most potent means for achieving stability, innovation when used as a way of positioning an enterprise would normally pay off. The business world, and indeed human kind, is dynamic. In the fast changing environment that we live, an enterprise must continue to reposition itself, not only to combat the environmental challenges, especially competition, but also to achieve a market niche and be hedged against business decline. An effective enterprise must essentially design the systematic abandonment of yesterday through effective innovation of new products, new processes and update means.

However, we need not be so optimistic; innovation as a means (though a science) is not always scientific; results on innovative moves are usually unpredictable. Thus, the needed concepts differ from one industry to another, and are sometimes peculiar to individual environments.

In truth, related ideas on what to introduce as innovative products/processes, when to so do and how to anticipate tomorrow’s markets and technology are not particularly theoretical, although one might learn from instances.  It basically remains a function of the leaders - the entrepreneur herself. To the SME, the entrepreneur must play the guide and in essence lead the way.  Innovation depends on the disposition of the entrepreneur and it’s the most powerful means for renewing a business.

In reality, the starting point for successful innovation in an SME is the related leader/entrepreneur – her philosophy and her ability to deliberately promote and accept the innovative attitude as a perpetual means in the business. This is particularly so considering the turbulent nature in our contemporary setting.

An effective entrepreneur must add value to existing products, find lower cost of supply and operations. 

Generally, explore more cost effective ways of doing business for the purpose of lowering unit cost of products or services. She should search and locate new leads for tomorrow’s opportunities or breakthroughs.

A new enterprise should simply turn its products from ordinary to spectacular, through innovation, thereby grabbing some market share from competitors. It may not be in your interest to compete head-on with the bigger and more established companies.

Consider the ingenuity in Cowbell’s break of bulk powdered milk into small sachets early in the 90s. They carved a new market by innovation.

Image: Tansel Ali

Image: Tansel Ali

The Innovation Process 

Let's start by understanding Innovation 

Key Points -

1. Innovation must be company-wide. It must be a norm in the enterprise. The spirit and habit of innovating should be all inclusive; management must encourage the liberty for team members to bring forward ideas. It is advised that from recruitment stage, job applicants with talent and creativity should be considered for key positions during screening. The company should then create a conducive environment for workers to foster. The company should develop its culture and ideology, which should be infused in every worker and every space, thus ensuring the right orientation. Benchmarking the large enterprises is allowed - Consider the pronouncement of Guinness Nigeria Plc:

"To continue to innovate and grow, the company needs to maintain a strong team of people performing at the top of their game. Through strategic recruitment of the best talents in Nigeria and the Diaspora, the introduction of innovative human resources tools and processes, and made-to-measure training programs, the company helps employees hone their skills and apply them on the job".

2. To be able to Innovate you must know - Why the present products? Why the current market? Who are the current customers and who will they be tomorrow?  What market segments are there? What opportunities are there in each? Are there any changing patterns in customers’ behavior? Where is the present market?  Where will the future market be? What does the customer want now?

What is value to him? What will he require tomorrow? How best can the product be made available to customers today? How should it be presented and distributed in future, perhaps in the light of changing technology?

How do we surmount the apparent environmental threats? How can the weaknesses of competitors be exploited? How can the strengths of competitors be adopted? How do we surmount the weaknesses in our operations?

3.Innovation is daring the unknown and never afraid of failure. Pepsi Academy of Football was established by the 7-UP Bottling Company in Nigeria basically as a futuristic move. Perhaps to create a rare kind of goodwill for the brand, especially among the youths.

4.Innovation is continuous anticipation of tomorrow. This Day Newspaper in Nigeria applied technology to beat competition using real-time on-line printing of her newspapers in Abuja despite the relatively low population when compared to Lagos for instance. The Company anticipated that there is a great tomorrow and a vast market in the new city of Abuja. Thus, leaving competitors lagging behind.

5.Innovation is seeking to differentiate between yesterday’s products and markets (obsolete); and tomorrow’s (promising) business direction in products, processes and markets. Discerning banks in Nigeria are directly promoting electronic banking using high tech ICT means in order to improve customer service, gain goodwill and be ahead of competition.

6. Innovation seeks to discover and take action in relation to: weaknesses in the current operation; untapped opportunities; new products for existing market; new market for existing products; new uses for present product; new users for present products; new markets for new products

7. Innovation accepts high rate of failure and encourages many trials.       

8. Innovation is a whole company affair and should not be related to some parts of it alone.

9. Innovation is open-ended since other market factors - the economy, Customers’ expectations and their behaviour, competition, government policy etc, are all dynamic.

10. Innovation is seeking means to overcome environmental threats, gross imperfections and   inadequacies around us.

11. Innovation is about gaining advantage in the market

Image: mumbrella

Image: mumbrella

How Many Innovative Ideas Should You Consider?

One basic issue in an innovative enterprise is the acceptance of the numerous (sometimes silly) ideas and the encouragement of many possibilities, some initially considered as wild. An  innovative management team would listen, consider and sometimes re-mould the relevant contributions to arrive at the final result. It is the one out of a hundred concepts put forward that eventually lead to the much needed breakthrough.

However, the generation of fresh ideas alone does not necessarily lead to successful innovation; other factors must also be present for success to be achieved. The following are recommended for innovative ideas to hit a breakthrough:

a. Idealists otherwise known as champions must be encouraged to voice out their initiatives

b. People’s ideas may fly in different (sometimes wild) directions, this must be tolerated; restrictions must be avoided.

c. You can encourage informal brainstorming sessions.

d. Lots of trials should be permitted; many of the ideas may not work initially, but could lead to other discoveries which will enhance the ultimate finding.

e. Ad hoc arrangements including various teams and task forces could be applied for the realization of the goal. Autonomy of experiments should be encouraged.

f. Rewards, especially in form of recognition should be in practice. This should be combined with cash awards

g. A group headed by the volunteer champion could be the means of working to realize the          idea.

h. The use of suggestion boxes could enhance the generation of ideas. Acknowledgment of every suggestion received through these Box would improve the number and quality of ideas

i. Informal and flexible lines of communication should be encouraged. This will promote the inclusive method where everyone has a voice

j. To be successful, leadership support to innovation is critical

Product and Marketing Success through Innovation: Innovation could be the basis of survival in a highly competitive industry; as an entrepreneur, you should apply it to every aspect of the business. But the areas where innovation must largely be applied are in the product and the marketing functions. This is due to the challenges of competition and the factor (relatively speaking) of short product life cycle. Moreover, a market, a product or even a whole industry if left static, could eventually decline as a result of sundry reasons - new technology, changing customer needs, changing tastes, fashion etc. Indeed, yesterday’s markets and the characteristics and features are totally different from today's, and will certainly not be the same tomorrow.

 

Mr. Bioye Akinfolarin is a Fellow, Member of the Institute of Chartered Accountants of Nigeria; an entrepreneur and a practicing management Consultant.  He is the author of the book, 'Comprehensive Enterprise Management

 

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The Value of Your Brand Asset

As global competition becomes tougher, the brand is one of the few assets that can provide long-term competitive advantage to corporations. Despite its commercial importance, its management still lags behind that of their tangible counterparts. When it comes to managing and measuring factory output the choice of measures is staggering, as are the investments in sophisticated computer systems that measure and analyze every detail of the manufacturing process, but very little is in place for the measurement of the brand asset. Although many brand measures are available, few can link the brand to long-term financial value creation.

Image: notey

Image: notey

As the importance of intangibles to companies increases, managers tend to install more value based brand management systems that can align the management of the brand asset with that of other corporate assets. While there is lack of detail about the contribution of brands and other intangible assets in the financial reporting of company results, investments in, and returns from tangible assets are reported at sophisticated and detailed levels.

For example, Coca-Cola’s balance sheet, income statement and cash flow calculations tell us about working capital, net fixed assets and financial investments, but little about the performance of the most important company asset, the Coca-Cola brand. The same is true for most other companies.

Current accounting regulations are deficient in their treatment of intangible assets. The increasing value placed on intangibles through mergers and acquisitions over many decades, has forced accounting standards to acknowledge and deal with intangible assets on the balance sheet. However, the standards deal only with the bare minimum, accounting for acquired intangibles, formerly known as goodwill. As a bizarre consequence, the value of acquired brands is included in companies’ balance sheets but the value of internally generated brands remains unaccounted for.

A closer look at some dimensions to brand evaluation:

Research-based approaches

There are numerous brand equity models that use consumer research to assess the relative performance of brands. These do not put a financial value on brands; instead, they measure consumer behaviour and attitudes that have an impact on the brand’s economic performance. Although the sophistication and complexity of such models vary, they all try to explain, interpret and measure consumers’ perceptions that influence purchase behaviour. They include a wide range of perceptive measures such as different levels of awareness (unaided, aided, and state of mind), knowledge, familiarity, relevance, specific image attributes, purchase consideration, preference, satisfaction and recommendation. Some models add behavioural measures such as market share and relative price.

Through different stages and depths of statistical modelling, these measures are arranged either in hierarchic order, to provide hurdles that lead from awareness to preference and purchase, or relative to their impact on overall consumer perception, for the purpose of providing an overall brand equity score or measure. A change in one or a combination of indicators is expected to influence consumers’ purchasing behaviour, which in turn will affect the financial value of the brand in question. However, these approaches do not differentiate between the effects of other influential factors such as R&D and design and the brand. They therefore, do not provide a clear link between the specific marketing indicators and the financial performance of the brand. A brand can perform strongly according to these indicators but still fail to create financial and shareholder value.

Financially driven approaches

Cost-based approaches define the value of a brand as the aggregation of all historic costs incurred, or replacement costs required in bringing the brand to its current state: that is, the sum of the development costs, marketing costs, advertising and other communication costs, and so on. These approaches fail because there is no direct correlation between the financial investment made and the value added by a brand. A Financial investment is an important component in building brand value, provided it is effectively targeted. If it isn’t, it may not make a difference. The investment needs to go beyond the obvious advertising and promotion and include R&D, employee training, packaging and product design, retail design etc.

Comparables: Another approach is to arrive at a value for a brand on the basis of something comparable, but comparability is difficult in the case of brands, as by definition, they should be differentiated, and thus not comparable. Furthermore, the value creation of brands in the same category can be very different, even if most other aspects of the underlying business, such as target groups, advertising spend, price promotions, and distribution channel are similar or identical. Comparables can provide an interesting cross-check, even though they should never be relied on solely for valuing brands.

Premium price: In the premium price method, the value is calculated as the net present value of future price premiums that a branded product would command over an unbranded or generic equivalent. However, the primary purpose of many brands is not necessarily to obtain a price premium, but rather to secure the highest level of future demand. The value generation of these brands lies in securing future volumes rather than securing a premium price. This is true for many durable and non-durable consumer goods categories. This method is flawed because there are rarely generic equivalents to which the premium price of a branded product can be compared. Today, almost everything is branded, and in some cases store brands can be as strong as producer brands charging the same or similar prices. The price difference between a brand and competing products can be an indicator of its strength, but it does not represent the only and most important value contribution a brand makes to the underlying business.

To capture the complex value creation of a brand, the following steps are recommended:

Market segmentation. Brands influence customer choice, but the influence varies, depending on the market in which the brand operates. Split the brand’s markets into non-overlapping and homogeneous groups of consumers according to applicable criteria, such as product or service, distribution channels, consumption patterns, purchase sophistication, geography, existing and new customers etc. The brand is valued in each segment and the sum of the segment valuations constitutes the total value of the brand.

Financial analysis: Identify and forecast revenues and earnings from intangibles generated by the brand for each of the distinct segments determined above. Intangible earnings are defined as brand revenue less operating costs, applicable taxes, and a charge for the capital employed. The concept is similar to the notion of economic profit.

Demand analysis: Assess the role that the brand plays in driving demand for products and services in the markets in which it operates, and determine what proportion of intangible earnings is attributable to the brand measured by an indicator referred to as the ‘role of branding index.’ This is done by first identifying the various drivers of demand for the branded business, then determining the degree to which each driver is directly influenced by the brand. The role of branding index represents the percentage of intangible earnings that are generated by the brand. Brand earnings are calculated by multiplying the role of branding index by intangible earnings.

Competitive benchmarking: Determine the competitive strengths and weaknesses of the brand to derive the specific brand discount rate that reflects the risk profile of its expected future earnings (this is measured by an indicator referred to as the “brand strength score”). This comprises extensive competitive benchmarking and a structured evaluation of the brand’s market, stability, leadership position, growth trend, support, geographic footprint, and legal protectability.

Brand value calculation: Brand value is the net present value (NPV) of the forecast brand earnings, discounted by the brand discount rate. The NPV calculation comprises both the forecast period and the period beyond, reflecting the ability of brands to continue generating future earnings.

 

Overall, there is an increasing need for brand valuation from both a management and transactional point of view.

 

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Communication Sense

A positive staff-customer relationship is critical to business success, so proper orientation and training are required by front-line employees, as a pre-requisite for achieving corporate objectives. 

Photo: metro

Photo: metro

Communication Techniques include:

1. The Question Technique: To understand customers’ complaints, you need to ask questions. Asking open ended questions is a very powerful technique in winning the trust of customers, because it helps in identifying their actual needs, which is indeed the main essence of communication.

Image: ponderweasel

Image: ponderweasel

2. Active Listening: Everyone loves to be heard, and relationships can be destroyed or built on this simple technique. Active listening is being aware of what the other person is saying, by silently giving supportive clues, like a nod of your head or expressive eyes, and then verbally restating their concerns. Active listening creates customer rapport and helps you to better tailor your sales message to the customer's requirements. 

3. Eye Contact: Good eye contact is an essential sales technique. It establishes credibility and good interpersonal communication between customers and the sales person.

4. Body Language: Great leaders are those who convey confidence and enthusiasm simply by their posture. This is why many companies employ the services of executive management consultants to conduct a variety of courses, including, important body language communication skills. For example, a welcoming stance is folding your hands loosely in front of you and giving your undivided attention. A relaxed, welcoming posture helps to form a trusting business relationship.

4. Voice Tone: Speak in a warm and enthusiastic tone, with a change in inflection to stress important points. A successful salesman should have the proper balance of emotion and energy.

5. Facial Expressions: Your feelings and thoughts show on your face, in particular your eyes and mouth. This technique according to communication professionals can help you with developing approachability through your smile and eyes.

6. Gesturing: It's good to use gestures to keep your sales message interesting, but do not overdo them. With proper orientation, you can apply the proper balance of gesturing with your hands, head, or eyes, so the listener will remain focused on what you're saying.

7. Avoid Negative perception: People have different backgrounds and experience, and often carry different perceptions. Therefore, in interpersonal communication, a sentence or a style of speech may be perceived in many different ways. A sales personnel cannot afford to have a negative preconceived idea about a customer, it may affect their business relationship, as they could be wrong in judging the customer, and would not be able to meet their needs. 

- TSH Team

 

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Ini Akpabio, The Hospitality Entrepreneur

Mr Ini-Obong Michael  Akpabio is a hospitality and tourism specialist from Akwa Ibom State. Ini attended the Federal Government College, Kaduna, University of Lagos (Bachelors of Science Degree in Business Administration), and University of Surrey (Master’s of Science Degree in International Hospitality and Tourism). He returned to Nigeria and proceeded to the Ahmadu Bello University, Zaria and got another Master’s in Business Administration in 1998.

Mr. Akpabio runs the Nanet Group, which specializes in Hotel Management, Catering Services, and Hospitality Consultancy Services.  A subsidiary of the Group, Nanet Hotels manages a number of hospitality firms across the nation.    

”NANET Hotel started in 1970, as the brainchild of my mother who was a full time house wife and needed something to do. On the advice of a staff at Barclays Bank then, she started a restaurant and later ventured into hotel management. Now, we are in full-fledged hospitality business. My parents represent the first generation of the company, while we are the second generation, and we already have a succession plan in place to ensure that the business is kept running. ”

IMG_0366.JPG

What is the Nanet Strategy?

One of the things we have been trying to do over the years is to ensure that every hotel under our management has an entertainment aspect.  We have successfully done this over the last ten years at the NAF club in Kaduna, where entertainment is a deliberate component of the hotel.  At the Nanet Hotel in Abuja, we have the Nollywood lounge which is a melting pot for the Nigeria movie industry. In there, is a history gallery of the movie industry - actors and those that distribute the movies and promote the industry.

What can you say about the hospitality and tourism business in Nigeria considering the fact that you’ve been in it for a while?

There are challenges, and one of them is manpower, and to solve that manpower problem we hope in the near future to start a Hospitality & Tourism Training Centre. Another challenge is lack of constant electricity supply. The situation affects us adversely, such that, most times, we rely mostly on generators to power our hotels; and even when we are not at full occupancy, we must provide power. This is one area we hope government is able to resolve.  

Sourcing finance is a problem as well.  Our loans are short term, with double digit interest rates; making it an almost impossible situation for lenders. For the hotel industry short term is five years, medium is ten years, and then long term about fifteen to twenty years, so why can’t I go to the bank and request for a loan that can be paid back over twenty years? Not in Nigeria!  Here we borrow money at very ridiculous rates and they want us to pay back in two years

Amidst these challenges were there times that you felt like backing out?

Yes, the times had to do with the critical issue of finance. You feel like you are in the wrong business.

What management policies have you put in place to ensure that Nanet is where it is today?

We have ensured a great deal of administrative efficiency. Building the organization devoid of tribalism, religious intolerance and all those other factors, we try to be as open as possible.  We have created a working environment that trains the staff, gives them some security, and instils passion for the growth of the organization.

As much as possible, most of the things that cripple small organisations have been taken care of; issues like victimization and sexual harassment, and we have committees in place to ensure that discipline is enforced.

Closing Remarks

Our economy just has to be suitable for investments. Attracting foreign investment is not just about just giving incentives; it is about creating an investment friendly environment, and only government can put this in motion. If they can give us the foundation, I am very certain that we have enough entrepreneurs who will take advantage of all the opportunities.

Ini is a philanthropist, he loves motor racing, motor biking and traveling. He is married with 3 children.

 

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The Necessary Shift to Commercial Talent by David Adeoye, CFA

Your Talent Should not be Dormant.

It is common knowledge that many world economies are currently facing challenges; it is expected that in the years ahead, the size and attractiveness of white-collar employment may diminish relative to the available supply of skilled labour.

At such times, two works of art come to mind. An old song and a piece of hilarious but instructive comedy. First the song by Juju maestro, Ebenezer Obey about four decades ago, based on the scripture parable of the talents. The song in Yoruba conveys a simple message, "Do not bury your talent my brother; for the Lord will ask you, what you did with it".

As natural abilities and talents carry both social and commercial value; they impose a measure of accountability for their use, non-use, or misuse. Even when a person has just one talent, his Master will expect a return on investment, according to the parable.

Now, to the comedy. 'Woli' Arole, a comedian, asked his audience  to pray -  “who is that fellow hawking my watermelons on a wheel barrow? May the heavens collect them, and display take at a grocery store!”  This comedy comes with some lessons. When you compare watermelons being hawked with a wheel barrow, and those displayed on the shelves of a grocery store; though same commodity, one commands a higher price than the other as a result of the location and method of sale.

Photo: cnn

Photo: cnn

In the same way, talents or skills expressed commonly, without good packaging or presentation, may pass as ordinary skills with no distinction or superior performance. It is not enough for the individual to find where his ability lies; it is important to find the right environment to nurture potential abilities to top quality, because talents require some level of organization and innovation to command its true market value.

Natural talents whether used or not, lasts a lifetime; mostly undiscovered, undeveloped and unused. Discovering talent or gift is the responsibility of every individual.

At critical economic times, people tend to revert to their natural abilities (beyond education and certifications) to create opportunities for themselves and others whom they will need to employ. Along with the emerging environment of opportunities, is keen competition in various fields of talent. Talent alone would not make much difference, it will need to transform from a mere gift or personal ability to a commercial enterprise that creates value, profitably and sustainably.

The ingredients and process through which raw talent is developed to commercial venture can be illustrated with two examples from the world of art: music and fiction-writing.

Photo: Cher Luxury Decor

Photo: Cher Luxury Decor

For example, in music, the singing talent is clearly manifest in the singer's voice and her ability to extend and control the output of that voice. Yet, a great voice, alone in itself, does not make a great musician. There is the process of voice training, which is only one aspect of a musician's development. As the individual works to progress from being a singer to becoming a musician, the skills, efforts, and contributions of others become increasingly important. At this point, the quality of human association, communication skills, ability to lead and work with others all become critical. The absence of these non-talent abilities can hold back or even unmake a potentially world-class music talent. The musician needs to work with voice trainers, songwriters, producers, musical instrument specialists, technical professionals (including studio managers), record label-owners and marketers, among others.

The writer of fiction faces a task that is simpler but is by no means easier. He needs to combine the discipline of concentration, imagination, good organization, willingness to learn with a natural flair for storytelling. The need to work with others is no less important. Like the musician, the writer must produce works that publishers consider to be potential winners among perhaps hundreds of competing manuscripts.

As various economies compel, amongst other factors, young men and women will choose their own paths based on their natural abilities, skills, and experience. Vocations in the world of entertainment, art, fashion, sports, food processing, culinary experts and so on, are springing up surprisingly in very creative and innovative ways.

There are makeup artists, head-gear stylists, culinary chefs, exotic bakers, event planners, caterers, party favor suppliers, comedians, mobile food stalls and supermarkets, courier/delivery services for all kinds of commodities; the list is endless.   

Beyond this trend however, the economic and demographic conditions would also impose keener competition within the talent arena. As this happens, the key differentiator in performance and value would not be the level or quantum of talent but the discipline, innovation, knowledge and organization, which the individual applies. He must be ready for the commercial demands in his chosen vocation by creating value from otherwise unused or previously underutilized talent.

 

David Adeoye, CFA, a deal adviser, corporate strategist, and business economist is a director at Fritova Economics.

 

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Tsh Tutorial Series - The Winning Business Plan - David Adeoye

Want to Win with a Business Plan?

 Address the Right Questions

At the start of most new businesses, a business plan is a standard requirement. The entrepreneur, financial investor, or strategic partner wants assurance that expected returns are realistic and sufficient, relative to the venture’s risks profile. Lenders seek the comfort that cash flows will be sufficient and can be realized in good time.

For large ventures, a business plan is required to attract top talent into key positions. In such regulated industries as airlines, pharmaceuticals, and financial services, regulators require a business plan as a pre-condition for a license. It serves as an evidence of the promoters' readiness to operate in line with industry standards.

The needs of each group can be addressed by a plan that addresses the important questions in five different aspects of a venture: market opportunity, offerings, organization, operating plan, and financial forecasts. A careful consideration of key issues in each of these domains will allow a meaningful discussion of the key risks that the new venture may encounter during the plan’s relevant time horizon.

No. 1: Product/Service Offering

Most businesses start with an idea of what product or service to offer. One approach is to find a product in a market that is both attractive and 'contestable'. Another approach is to seek out under-served markets or segments and plan to deliver a superior service, a higher quality product, or a superior distribution model. Most successful product-oriented new ventures target specific buyer-needs, and build an offering to meet that need at a profit. Important questions to address here include: what buyer-needs do you seek to satisfy? What products or service would you offer? How will your product(s) create value for each buyer? Are you going to make or buy the product or service?

No. 2: Market Opportunity

With your initial product choices made, it is important to subject those choices to the market test. Given your intended product or service, what is the size and structure of market demand? What is the existing supply capacity? What are the deficiencies in the current value chain? Are buyers sufficiently dissatisfied? What are the pain points in existing business models? What is the minimum scale at which you can start? At what rate does your target market grow? Are there alternative, or new emerging needs you can serve? Each question requires answers that must be supported with facts. During the planning process, there is a continual interaction between product choices and market opportunity.

No. 3: Operating Plan

Armed with a clear view of the market opportunity and the offerings required to serve that opportunity, you need to demonstrate how ‘supply-side’ resources will be mobilized to deliver user benefits on the 'demand-side'. What primary and secondary inputs do you require? How will you source them? What will your typical delivery cycle (from raw materials to cash collection) look like? Will the business be short-cycle, high velocity (e.g. retail of groceries) or will it involve long-term contracting (e.g. power generation) or is it a one-off project (development of low-cost residential housing for sale)?

The operating plan should show how you will source, transform, and sell or deliver. Unit costs, quantities, and totals per period (monthly, quarterly, or annually) needs to be included in the operating plan as well. The required investment (what, when, and where) also need to be outlined.

No. 4: Business Organization

In all but the most rudimentary and low-scale businesses, it's usually necessary that a management team be put in place to translate the plans into reality. You need to be clear on the structure of the organization. What roles are required? Who will fill each of these roles. For large ventures, many financiers consider this section to be most important. Having experienced, credible people on your team is important for effective execution of any business plan.

No. 5: Financial Projections

If the product choices, market opportunity, operating plan and organization have been carefully considered, then your financial projections come down to translating your prior decisions and forward expectations into forecast financial statements. Key forecast items include revenues, operating expenses, non-operating expenses (including financing costs), and asset needs. Usually you will need a forecast of the following for five-year period: Income statement (or profit & loss account), balance sheet (showing the expected assets and liabilities of the business) and cash-flow statement which is of particular interest to bankers. From these, you can compute the relevant ratios, e.g. profit margins, return on assets, and sales velocity over relevant period.

No. 6: Risk Analysis

The most astute investors are conscious of the fact that reality hardly turns out in perfect harmony with laid-down plans. Hence it is important to itemize clearly what could go wrong in each of the primary areas and which may affect your financial forecasts. Key questions are: What can possibly go wrong? How could the business be affected? What do you have in place to prevent the risk or deal with its effect on your business? Closely related to risk analysis is an evaluation of key sensitivities. For example, if market growth rates drop by half, how will your own sales be affected? What if prices of inputs rise by a quarter, would you still realize decent margins?

Beyond writing a plan, it is important for an entrepreneur to go through a structured planning process to address key questions in each major domain discussed. These same questions will be of interest to your key stakeholders especially financiers, regulators, and business partners. In the words of former US President, Dwight D. Eisenhower, "plans are worthless but planning is everything". Your business plan is most valuable when it shows you have thought, and indeed worked, through the key aspects of the new venture that are truly important to its economic success.

Goodluck!

 

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Can Lost Opportunities be Regained? by T.W.Oke

‘Opportunity lost can never be regained’ is one of the most used quotes.  How true is this, and what really constitutes an opportunity?

In the business sense, opportunity is the nectar for entrepreneurial bees. It is a raw resource that doesn’t appear to be of much use to most people, but which entrepreneurial bees can identify, and turn into honey.

Opportunities may not only knock; they can be found or created

Photo: residentialmarketing

Photo: residentialmarketing

Finding opportunities may seem difficult, but they are all around us, although oftentimes, there’s so much going on that we don’t get to recognize these opportunities. However, the entrepreneur’s senses for perceiving opportunities should be apt. He should be fully aware of his environment and should know how to utilize information around him to create new business opportunities and turn them into profitable business ventures.

Nestle came up with Nespresso to fill the need for instant espresso coffee; they recognized that making it a luxury gourmet item would set the product apart.

It worked! They saw a gap of opportunity and filled it. Other companies have since followed their lead.

Opportunity may not be a new business idea; it could simply be filling a vacuum that in existing markets. For example, Sir Richard Branson seeks opportunities, enters the market with value innovation and product differentiation, which eventually leads to success.

How do we spot opportunities?

Opportunity from Passion

Most successful businesses are born out of passion, and when passion meets opportunity the business grows. When you are passionate about your business, everything about it gets your attention and you are more likely to openings to fill. So what are your passions? Identify them and discover opportunities there in.

Opportunity from Skill

If you are skilled at something, there is the possibility to turn it into a business opportunity. A good shoe repairer can begin a shoe restoration business. There are endless possibilities when people acquire skills of any kind, as turning skill into a business is an opportunity on its own.

Opportunity from Contacts

"The best entrepreneurs are people’s people" 

Successful entrepreneurs nurture and build relationships with a variety of people. They don’t only consider short term business relationships or the potential for a quick transaction, but value long term relationships and repeat business ventures.

A wise entrepreneur doesn’t just keep a list of contacts, but maintains the relationships, and keeps them active by keeping in touch and constantly checking-in during important dates and events.

 Opportunity from Trends

Finding out what’s new should be a pastime for people who love to find opportunities from emerging trends. Such people can anticipate the next trend, and can even spark up a new trend. They keep abreast with developments in their business world, and can ‘see clouds gather.’

Opportunity from Problems

The solution to a problem is a potential opportunity. While one person complains, another is thinking and proffering a solution for profit. Some people are experts at business and product development; theirs is to scrutinise the market and identify loop holes for developing a new business or product. Having special eyes and mind for critical thinking is required to fish out opportunities in problems.

Opportunity from the Unexpected

Great breakthroughs in science are not marked by a researcher shouting “Eureka!” but mumbling something like “hmm! that’s funny or that's interesting...” as they get an unexpected result from an experiment. This is also true in business. You need to watch out for the unexpected, something that breaks the acceptable pattern, a deviation from the norm. Sometimes a mistake may become your winning solution; embrace it, patent it, get rich with it!

 

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What do your Brand Colors Depict? by Toyin Oke

Before you begin to design your corporate logo, you should know the message you want to convey and the colors that will send the appropriate message. It is not just about the love for particular colors; you need to understand the psychology of colors and the relationship between your choice and the way people feel and react to your brand and message.

Color is actually known to be the most important component of creating brand identity, because most people have good visual memory to recall events. About 90% of shoppers accord great importance to visual factors, such as colors and shapes, when shopping, than to other factors like touch, or smell. So, colors must be distinctive.

The concept of branding is
tied to many aspects of life,
including colors! 

Colors are powerful, like most of nature's tools. The color you choose is the root of your subliminal message, and this should also be considered when painting your office or outlet.

Let’s see how colors affect your brand.

RED is striking; it has many meanings, and should be used with careful consideration. It is the color of fire and blood, it conveys power, energy, war, danger, strength, determination, passion, desire, love, urgency, and confidence. If dashes of red are used in an office, employees may be more physically active. 

Reds and oranges are not calming, hence used in fast food eateries. They make food more appealing; diners consume more, but quickly, and exit.
Burgundy and forest green are perceived to be upscale, and so used for luxury items, while an orange label signifies cheap and inexpensive. 

BLACK gives the feeling of perspective and depth, it is also associated with maturity, elegance, prestige, and sophistication.
In fashion, black clothing make people look leaner, and it is a color of grief and despair. It is usually used to symbolize death, fear, evil, and mystery.

WHITE is light, goodness, innocence, purity, faith, perfection, and safety. It connotes cool successful beginnings; it is clean, and fresh.

YELLOW: Houses painted yellow or with yellow trimmings are very attractive. Yellow is the color of sunshine; it evokes hope, cheerfulness, joy, happiness, intellect, caution, and energy. It is often associated with food retail outlets. Bright, pure yellow is an attention grabber, however, and if overused, it may have a disturbing effect of unease, urgency, agitation, restlessness; it is known that babies cry more in yellow rooms. 

Photo: design4inc

Photo: design4inc

BLUE is the color of the sea; it produces tranquility and calmness. It is observed that rooms painted blue often produce people with higher test scores, it also increases reading retention.
It connotes depth, strength and stability.  It also symbolizes trust, loyalty, wisdom, confidence, intelligence, faith, and truth. Blue is associated with piety and sincerity. Too much blue could also be counter productive, resulting in laziness, tiredness and lackadaisical behavior. 

GREEN represents nature, freshness, environmental friendliness, growth, and money. It is relaxing and promotes a soothing and healing environment.

Photo: brandwatch

Photo: brandwatch

PURPLE connotes nobility, luxury, royalty, and ambition; it symbolizes power, wealth,and extravagance. It represent wisdom, dignity, independence, creativity, and mystery.

Young children are excited and intrigued with primary colors, and respond positively to them. These colors are therefore used for children’s toys, books, movies and so on.

We should not take the strength of colors for granted. It is important to look closely at the vision of your company, and then determine what colors carry the appropriate message. 

Note: All colors have different connotations and may have symbolic meanings in different countries and cultures. It is therefore important to understand your environment and also test the choices before you color your brand.

 

Winning Strategy - Making the Best of 'Low Hanging Fruits' - Terence McArthur

Photo: coloradopeak

Photo: coloradopeak

The phrase ‘low hanging fruit’ has been used since ancient times. On print, it first appeared in 1968, and simply refers to something that is easily attainable; by the 90’s the phrase had become established as a sales strategy in the corporate world.

Ordinarily, fruits are borne on branches of trees. Harvesting fruits can be easy or tedious, depending on the size of the tree, and the location of the branch bearing the fruit on the tree.

In this regard, the farmer harvesting can either stretch out an arm and access the fruit, for the ‘low hanging fruits’, or deploy help or assistance with tools and machinery to harvest the not so low hanging fruits.

This same analogy can be deployed in everyday life and business endeavors.  Here, ‘low hanging fruits’ can be described as targets that are easier to reach, deals that are easier to close, sales easier to make, problems that are easier to solve and so on.

Usually there are transactions, experiences and actions we undertake with minimal fuss, and gain maximum yield, these are ‘low hanging fruits.’

In all spheres of life, It is important that we identify the fruits that are hanging low around us, and effectively pluck them. Leveraging on this strategy can boost rapid sales or increase while still working on the more arduous targets that takes longer time. This strategy can be used to provide the necessary steady source of income or resources to address the everyday operating expenses of a company or individual, while pursuing other long term businesses that may involve deploying considerable time and resources to actualize.

The ‘Low hanging fruits’ Strategy can be achieved by leveraging on relationships and associations with key decision makers and sometimes family members.  However, these people must have the requisite confidence and trust in our ability and integrity to come good on delivery.

 

Risks, an Entrepreneur’s Best Friend.

photo: wikimedia

photo: wikimedia

It is on record that Orville Wright (1871-1948) and Wilbur Wright (1867-1912) invented the airplane. The first engine-powered airplane to fly was the Kitty Hawk on December 17, 1903. On this maiden flight, the craft soared to an altitude of 10 feet, travelled 120 feet, and landed 12 seconds after takeoff. This was the first successful, powered, piloted flight in history. Prior to the breakthrough, the Wrights had spent a great deal of time observing birds in flight. They observed that birds soared into the wind and that the air flowing over the curved surface of their wings created lift. Eventually their efforts yielded results after a series of tests and failures spanning over three years from 1899. In November 9, 1904, the first flight lasting more than five minutes took place. Further tests and improvements led to the US Government buying it’s first airplane, a Wright Brothers biplane (speed, 64 Km/Hr) on July 30, 1909 for $30,000. There are many lessons to learn for entrepreneurs from the Wright brothers and the airplane invention.

Beautiful Risk

There are risks to any venture in life, business or project. On that I’m sure almost everyone is in agreement. What’s not of widespread knowledge or acceptance is the beautiful value that risks bring to entrepreneurs. The simple truth is that without risks, there is no business. No enterprise! Anyone who wishes to eliminate risks or obstacles or uncertainty in business is inadvertently wishing death for the business field. It is thus ironic that the concept of risk creates fear in the minds of many, including entrepreneurs when the opposite should be the case. For an entrepreneur to be successful, he must be able to deliver quality products or services to customers at the right price on a consistent and reliable basis. Reliability and consistency are not chance events but are rather products of creative thinking, thoughtful planning and efficient utilization of resources. Effective and efficient implementation of any business objective principally requires a thorough understanding of the various risks that lurk on the path of deployment. This understanding allows the business or project owner to proactively design cost-effective ways of navigating through the risky paths and emerge successful. The understanding of business risks only comes through formal or informal risk assessments and evaluation. Because many entrepreneurs do not understand the process of risk assessment or are too timid to deploy risk assessment practices to their business or project plans, many businesses fail or continue to make losses. These are direct results from the impact of the risks which hit them unawares as they are poorly prepared. But the few entrepreneurs who are grounded in the principles of hazard identification and risk assessment successfully cross the bridge to profitability. The interesting thing about business risks is that they’re responsible for the failure of many entrepreneurs who fail to recognize them while simultaneously representing the same factors that create a relative monopoly for the few who proactively assess and provide mitigating or preventive measures for the risks.

If all aspiring entrepreneurs practiced sound risk management practices, they’ll each succeed in creating equally sound and priced goods and services. When this happens, the market will be flooded with excess of everything. Under such conditions, there’ll be no competitive advantage for any entrepreneur leading to poor sales, no profits. Motivation for entrepreneurship will disappear. Because enterprise is a natural and instinctive endeavour, risks become the barriers that stop your competitors from doing exactly what you do or doing it as efficiently as your company, thereby creating the competitive advantage for your efforts to result in profits. It is for this reason that for you to run a profitable business, you should consider risks as your best friends because they keep your competitors down. If you treat them as valuable companions, you’ll make deliberate efforts to uncover their identities and develop strategies around handling them without wishing or hoping they did not exist.

The Airplane Analogy

Before the Wright brothers succeeded in the building the first aircraft, the laws governing flight have been in operation. It is the same laws that the birds, without university degrees, have been applying in flight. The inventors studied bird flight patterns to understand how to design systems that will overcome friction and air drag to enable man fly. They discovered the balance of forward speed, aircraft shape, weight and control required to cause lift and flight. During take off, a plane builds up considerable speed at maximum wing spread. While it is desirable in design for the airplane to navigate the risks of friction, air drag etc for flight, it is the same risks, (friction and drag) that the plane uses when it desires to land. In preparation for landing, an aircraft usually reduces speed, pushes out some wing parts at a sharp angle to increase air drag. The wide tires are also released to make contact with the tarmac to make full use of the speed reducing effects of friction (risk) between tire and concrete/asphalt coating. Without the drag and friction, although a plane on take-off minimizes their impact, for landing to occur, they must maximize the effects of the same drag and friction. Otherwise, once a plane takes off, it will not be able to land. Risks play the same role for entrepreneurs. 

Another observation is that the first planes had one or two passenger capacity and were not in any way like the aircrafts of today. The early speeds were about 60KM/Hr with no enclosures for pilots and passengers. Today’s planes i.e. military fighter jets, have speeds beyond Mach 4 (4 times the speed of sound). The Boeing 747-400 Domestic aircraft can seat 568 passengers and fly at up to a speed of 947Km/hr. If the Wright brothers’ focus was in starting with a plane that can carry 500 passengers and fly at 900 km/hr, they will not have succeeded. At least not in pioneering air travel as the challenge would have been too daunting for their experience and knowledge level at the time. Many aspiring entrepreneurs want to start their businesses at the Boeing 747 Jet level, well beyond their knowledge, experience and resource base driven by the greed of hitting the big breakthrough at the fastest possible time. My advice is to start small at levels of risk that you can understand, manage and control. Failures at such levels will not break you but rather serve as valuable learning and appreciation of the risks involved to develop a risk management style. Thereafter, you can scale up to higher levels. Otherwise, you may not be spared the consequences of such folly.

Photo: 3.bp.blogspot

Photo: 3.bp.blogspot

Simple illustration. Let’s review a case where Mr. David, an entrepreneur who wishes to supply specialized pellets to a group of manufacturers who need these materials in large quantities. The end users of these pellets currently buy them at a unit cost of N20 each but the current suppliers in the market cannot meet the aggregate demand. Preliminary assessments reveal that the buyers consume these pellets in excess of N500m value annually and could use more if they can be guaranteed enough supply. David carries out preliminary investigations and finds out that using bulk purchasing methods, he can buy the raw materials for the pellets at N2 each (Equivalent) from Ghana. He was told that production costs for each pellet would not cost more than N5 each. He also has the option of importing the finished pellets from Europe at a unit cost of N9 excluding transportation, logistics, and other associated costs. David has no previous manufacturing or production experience but the production option appeals to him. For illustration purposes, we make a simple graphic to highlight the potential risks on the path of achieving his goal of profitably engaging in the supply of pellets to the manufacturers.

THREATS

Issues which if not protected against might lead to the Risk Event occurring

RISK EVENT

The risk event which the business owner must put adequate measures or barriers to prevent occurrence

CONSEQUENCES

The various consequences which might result from the risk event

Wrong information regarding cost of raw materials

Production Cost

Customers unwilling to buy at higher costs 

Raw material producers increase price based on surge in demand

Sell for less out of desperation to cut losses

Increase in transportation costs

Rising interest charges on borrowed funds

Stealing of raw materials in storage

Loss of highly priced assets through forced sale by lenders to recover loan

Poor estimate of implementing production factory project costs (Underestimation)

Adverse health effects (High blood pressure, heart-attack, stress, etc)

In-country inflation

Loss of reputation

Increase in alternative power supply costs (Diesel fuel + Maintenance costs)

Worker dissatisfaction leading to lowered productivity as a result of owed wages

Withdrawal of a major financier, forcing alternative sourcing of funds (higher cost of money)

Loss of credit facilities from suppliers

One way of minimizing the risk event from occurring is to do due diligence upfront. Careful market research, trending and data verification are some ways that will generate top quality information for decision making. People who disregard the all-important aspect of assessing and analyzing risks prior to committing significant funds into a project or enterprise end up paying a huge price for the mistake. Risks and uncertainties will always be there lurking round the corner. One should never allow the excitement inherent in a suspected opportunity to cover the fact that on the path of every opportunity lies a series of obstacles that ensures that only the best prepared makes it to the finishing line.  The fact that many people do not prepare well enough presents a wonderful opportunity to the very few who are ready to pay the price in preparation. Nobody likes to be taken for granted. Not even risks.

 

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Supply Chain Management - The Winning Edge

Supply chain management (SCM) is the process of planning, implementing, and controlling the operations of the supply chain with the purpose to satisfy customer requirements as efficiently as possible. It spans all the movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to point-of-consumption. It encompasses the planning and management of all activities involved in sourcing, procurement, conversion, and logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, Supply Chain Management integrates supply and demand management within and across companies. The term supply chain management was coined by consultant Keith Oliver, of strategy consulting firm Booz Allen Hamilton in 1982.

As companies search for ways to proactively stay ahead of competition, there is a continuous and intense pressure on the profit margin, customers’ are getting sophisticated in their demands and it is increasingly becoming difficult for organizations to exceed or meet their needs. Meeting or exceeding such expectations is a critical success factor that can be achieved through efficient and cost effective flow of materials and information from source through the entire organization and unto the end user. Efficiency in material and information management has become a challenging reality confronting many organizations.

Photo: glenwoods

Photo: glenwoods

The aim of this contribution is to help organizations understand how to develop, organize and execute proper supply chain management in their organizations; and free all bottle necks and identify hidden values in their operations by increasing profit, customer service, quality and reducing lead time.  

Supply Chain Activities/Functions:

Supply chain activities can be grouped into strategic, tactical, and operational levels of activities.

Strategic

  • Strategic network optimization, including the number, location, and size of warehouses, distribution centers and facilities.
  • Strategic partnership with suppliers, distributors, and customers, creating communication channels for critical information and operational improvements such as cross docking, direct shipping, and third-party logistics.
  • Product design coordination, so that new and existing products can be optimally integrated into the supply chain, load management
  • Information Technology infrastructure, to support supply chain operations.
  • Where to make and what to make or buy decisions
  • Align Overall Organizational Strategy with supply strategy

Tactical

  • Sourcing contracts and other purchasing decisions.
  • Production decisions, including contracting, locations, scheduling, and planning process definition.
  • Inventory decisions, including quantity, location, and quality of inventory.
  • Transportation strategy, including frequency, routes, and contracting.
  • Bench-marking of all operations against competitors and implementation of best practices throughout the enterprise.
  • Milestone Payments

Operational

  • Daily distribution planning, including all nodes in the supply chain.
  • Demand planning and forecasting, coordinating the demand forecast of all customers and sharing the forecast with all suppliers.
  • Sourcing planning, including current inventory and forecast demand, in collaboration with all suppliers.
  • Inbound operations, including transportation from suppliers and receiving inventory.
  • Outbound operations, including all fulfillment activities and transportation to customers.
  • Order promising, accounting for all constraints in the supply chain, including all suppliers, manufacturing facilities, distribution centers and other customers.
  • Performance tracking of all activities.
Photo: enterrasolutions

Photo: enterrasolutions

 Supply Chain Focus:

  • Customer service Management
  • Product development and Commercialization
  • Procurement
  • Logistics

 i.            Inspection

ii.            Packaging/shipping

iii.            Customs Clearing

iv.            Post Shipment Transportation

v.            In-country forward and reverse logistics

vi.            Asset Management

  • Packaging/Assembly Plant/Factory.
  • Reverse Logistics/Returns Management
  • Inventory Management and Distribution

i.            Warehouse

ii.            Physical Distribution

iii.            Outsourcing/ Partnerships

  •  Performance Measurement

i.            Cost

ii.            Quality

iii.            Speed of operations

The above mentioned indices are measured against customer perception, best practice bench-marking, industry standard and against promises to the customers both internal and externally. The focus is to consistently meet or exceed our customers’ expectations.

In the subsequent editions, I’ll begin to explain the different aspect of supply chain and how it can be used as a competitive edge of an organization.

Prolog Consulting Limited

 

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Our Start Up Story - House of Tara - Tara Durotoye

What is the story of House of Tara?

House of Tara started as a bridal make-up service. Then, I used to find out who was getting married and market myself to them hopefully to get the chance to do their make-up. This started in 1997, while I was still in the university. As time went on, it became a registered business name known as Tara Make-Overs, then a limited liability company, later House of Tara. Tara Make-Overs had to evolve into House of Tara because business itself was evolving and presenting opportunities in its wake; corporate jobs started coming, people wanted to learn the art of make-up, so we started a school.

 

Photo: bellanaija

Photo: bellanaija

Your entry into the industry brought a sort of revolution. How did you achieve that?

Well, it is the Grace God that has made me to be a trail blazer, and because of that Grace, I began to open different markets in the industry. I made it become prestigious, corporate and as well introduced the concept of branding into the industry. It is from this Grace that the ideas flow. The more the ideas came, the more I executed them, and they just kept coming.

 

Your Driving Force

My driving force is purpose. Living a purpose driven life is vital in my ability to wake up in the morning and do that which God has put before me. When I am able to achieve that, and the record is broken, then I have a desire to break another record, and another record. So, it is a desire to be purpose driven and to achieve what ever is before me.

 

Challenges…

Challenges have been numerous, but they make you strong. I have had challenges of having to make people believe in the service at the beginning, followed by the challenge of building a brand whether consciously or unconsciously. Equally, there is the need to stay ahead of competition, so we’ve had to come up with innovations like tying ‘Gele’ for brides because a lot of women can’t tie it. It is not just staying ahead of competition, but jumping far ahead of it and staying on top. When we came up with the make-up school, there was the challenge of building a curriculum and charting a course for the future. Then staff issues; how do you make them believe in the vision of the company so they can become vision bearers? How do you train and engage them in such a way that they are constantly thinking about the vision the way you are thinking? Time goes on, you have new business ventures. How do you raise capital? The challenges are actually numerous, but we are constantly evolving ways of remaining on top.

 

It began with Orekelewa…

Orekelewa means ‘beauty of a maiden’ in Yoruba. Like I said earlier, the product line is an empowerment platform to help young ladies to become financially independent. When you think about young ladies, you think about maidens – you think ‘Orekelewa’. I wanted a product that would promote our culture, ethnicity and values.  So that when you see it, you will know it is indeed Nigerian. If you buy our products, you will notice that the name of the shades is not what you find in Europe or America. The names of our shades are drawn from Nigerian languages, not only do you have the word; you also have a short note behind it talking about the origin of the word. What we are trying to do is promote and propagate our culture even beyond the shores of this country to as many locations as the product gets to.

This interview was culled out of the Tsh Archive; indeed one of our most inspiring...

Kudos, Tara

 

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Steps to Building a Brand II - Brand Currency - Toyin Oke

You must know what a brand is and what it is not. 

  • It is not a logo or product;
  • It is simply the perception of your business in the mind of the consumer.
  • It is a promise.
  • A promise of that is meaningful and valued by the customer. A promise, that sets you apart from your competitors.

You must assess and know what’s going on in your industry and its market place. To do this, you can create a department or a team that will note opportunities and threats that may be facing your company.

You must know your position in your industry using parameters like assessing the way you do business, handle your customers, your products & services and the messages that you want to – and are able to deliver consistently to your customers.

Compare them to that which exists with competition.

Develop a list of your strengths and weaknesses.

The steps above are basically developing a SWOT Analysis (strength, weaknesses, opportunities & threats).

To do this exercise effectively you need to involve a team of employees at your company or employ the services of a business consultant.

You then can discover your current brand. Based on results from step 2 and 3, you can determine where you are today. This is critical in developing your brand strategy. It is the time to pull up your vision & mission statements for review. Then, with a clean idea of your target audience evaluate the following points.                           

  •  What is your company’s specialty?
  • What are your products & services and define their qualities.
  • Find the core values of your products & services.       
  • What kind of people does your products & services attract?
  • What does your target think about your current brand? Conduct a                                             survey. Find out how your customers feel about your business.
  •  Define what you want your brand to be. Now you know where you are, find where you want to go. What vision of your company do you have? What do you want it to become?

Branding starts with goals. You must to have aspirations. Come up with clear objectives of what you want your company to be in the next 2, 5, & 10 years. Your brand has to be authentic and relevant. You must know what your customers want and how to offer it to them.

Create the new realm in which your company exists. This helps your customers navigate easily within your company and gives structure to your company and organizes the identity of different products, messages and other elements.

Communicating its department, division and units as well as products, services all with the objective of adding value to the brand.

Now, present your new brand. Present it consistently; instill it in all your products and services including packaging, logos, corporate culture, website, business premises, and adverts. (Redesign your logo if necessary). Build the message into everything your customer sees and hear before they have any direct contact with your company. Make sure your company literature reflects your brand values.

Make sure your staff understand these values and believe them. Their attitude/behavior will influence the success of your brand. The power of your brand comes from how known and exposed it is. Spend what is necessary to get your message to your target market. Manage your marketing so that it makes a consistent impression of your desired brand image into the mind of your target customer.

Photo: gophotolondon.com

Photo: gophotolondon.com

* Consistency builds brands

* Create a single impression for your business

* Project a consistent look

* Project a consistent tone in your communications.

* Project a consistent level of quality in product, services and everything that represents your company.

Every employee is a steward of the company brand, they should carry it well. 

“Your customers’ notion of your brand is formed from his or her first experience with your company, products or services. Every customer interaction is a chance to enrich the brand” – Michael Di Frisco.

You can now go ahead to integrate your new brand strategy into all your marketing and communications, and soon your marketing efforts will soar.

Note:

Be consistent: Don’t change your brand image unless you are sure that it no longer works for the market. (By then you might as well be changing your business).

 

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