Where's the First Place to Look for New Growth Opportunities? Exploiting Hidden Successes-Part I
Peter F. Drucker provided us with an array of practical tactics for identifying new opportunities for growth. A list of his most significant includes:
- the unexpected success/failure
- industry and market structure changes
- creative imitation
- entrepreneurial judo and
- the ecological niche
These tactics share the common denominator of focusing on opportunities in meeting unmet customer needs, but they differ in the degree of risk involved and the time required before they produce results.
We will over the course of the next several months discuss each of these tactics…. and illustrate the use of these tactics with mini-case examples provided by professionals who have put these Drucker's insights into practice.
But for the moment, we will discuss just one of these tactics–namely, the unexpected success. It's usually the least costly but still highly effective way to discover new growth opportunities.
It's so obvious. Yet ignored in most organizations. It involves "seeing not just looking" coupled with a modicum of systematic analysis.
The unexpected success is usually treated as a nuisance. Nobody is looking for it; nobody wants to be bothered by it; nobody is assigned to seriously look at the possibilities of exploiting the unexpected success.
Management must look at every unexpected success (assuming they have the wherewithal to identify those successes) with the questions:
- What would it mean to us if we exploited it?
- What would we have to do to convert it into an opportunity?
- Where could it lead us?
- How do we go about doing it?
This means, first, management needs to set aside specific time in which to discuss unexpected successes; and second, that someone always be designated to analyze an unexpected success and to think through how it could be exploited.
Soup for Lunch: A Simple Example From a Colleague's Personal Experience
Our first example involves a colleague of ours. During the summer months, he purchases food at a seasonal market that specializes in a variety of pre-prepared meals. Their soups are truly unique and extremely nutritious.
For the past 15 years, he purchased about 75 soups at the season's end to last through the fall and winter months. He freezes the soups in his basement freezer.
The owners of the market were happy. They found the special soup order a little inconvenient but profitable. From their point of view, "they were just keeping a good customer happy and satisfied."
It was a standing joke—whenever he shopped at the market, he was identified as the fellow who purchased all those soups for the winter.
He was usually introduced to other customers and friends of the market owners as "the guy we were telling you about, the one who buys all those soups and freezes them."
People couldn’t help but roll their eyes when hearing the introduction—followed by a manufactured “haha.” It seemed insane.
Then, the son of the owner of the market graduated from a top business school and entered the family business. He was well-versed in the teachings of Peter F. Drucker.
It should be mentioned—indeed, emphasized—the owner’s son was knowledgeable about Drucker's principles and practices because our colleague gave him several Drucker books as a Christmas gift when he was 16 years old. This wasn’t something he learned in business school.
He remembered Drucker saying, "Look for opportunity in the unexpected success."
So, what did he do after his first year working at the market? He began promoting and labeling soups as freezable for the winter.
Now, the market does an impressive amount of business selling frozen soups and other food items. Sales are reported to have doubled—mostly to existing customers purchasing freezable items.
Simple? Yes! But not easy to do. Why? Because, typically, there isn’t a formal system for identifying the unexpected success or a mechanism to assign the required resources for capitalizing upon it.
Are you "sweeping your unexpected successes under the rug," or are you systematically attempting to identify unexpected successes and purposely exploiting them?
A Useful Digression: Opportunity Meetings to the Rescue
According to Drucker, the prototypical business meeting is concerned with the care and feeding of problems; successes are usually ignored. Simply put, the focus of most meetings are about problems. Little time is spent on discussing/thinking through what should be strengthened and built, that is, exploiting successes.
One of Drucker's major principles stresses the importance of OPPORTUNITY MAXIMIZATION as opposed to profit maximization.
Of course, problems have to be dealt with, but when crises receive all the attention, congratulations are usually reserved for those that prevented problem(s) from getting worse.
More important, struggling with problems the expense of opportunities quickly produces a famine in resources–especially, highly competent people assigned to problems rather than opportunities.
To repeat: Most opportunities are starved for lack of first-class people that should/could be assigned to making identified opportunities into operating reality. Instead (in many organizations) the best and the brightest are typically assigned to keeping yesterday alive a little bit longer.
Two Kinds of Meetings
Drucker suggested organizations have two kinds of meetings–namely, meetings to discuss problems and meetings to discuss opportunities with special emphasis on unexpected successes that have gone unnoticed.
In essence, Drucker's principle of opportunity maximization must be converted into a practice that can be practiced. Indeed, careful readings of Drucker reveal he discusses principles... and then practices for converting the principles into doing. The opportunity meeting is the practice.
Opportunity meetings are the ideal venue for discussing unexpected successes and what to do about them. Successful executives practice mindfulness. Mindfulness is focused attention. Mindfulness training can teach executives how to "switch tracks" from the rigid world of the fixed mindset to the open and receptive way of the growth mindset.
Stated differently, defenders of the steady state or status quo are plentiful. Resistance arguments are typically convenient rationalizations for postponing the inevitable or excuses for doing nothing. In many instances, management mindsets are fixated on preserving the status quo rather than capitalizing on growth opportunities.
The Role Of Mindfulness Training in Making Executives More Responsive to Exploiting Successes
The general practice of mindfulness is a step-by step process of self-awareness, self-regulation, and self-transformation.
At CLW 2020, Dr. Jeremy Hunter, unquestionably one of the most respected authorities in achieving quantum leaps in knowledge worker productivity through the practice of self-management will be keynoting our conference plus conducting a methodology-driven workshop guaranteed to help managers liberate themselves from self-imposed boundaries/limitations.
Without question, Dr. Hunter's workshop will amplify and extend many of the points discussed in this article related to making one more receptive to opportunity maximization.
To reiterate: Opportunity meetings provide an organized way to focus attention on opportunities. Further, preparing for an opportunity meeting, in many instances, requires executives to drill down on "aggregated sales data" in order to discover unexpected successes.
Take-home message: Resources, to produce results, must be allocated to opportunities, rather than to problems. By making opportunity meetings an established practice, organizations can go a long way in finding the right things to do, and concentrate resources on bringing these to fruition.
We will be publishing Part II of this article in the near future-stay tuned! It will detail the necessity of drilling down on the sales data to identify unseen opportunities.