An Entrepreneur's Strategy for Thriving in the New Normal: From Opportunity to Advantage

An Entrepreneurs’ Strategy for Thriving in the New Normal:

From Opportunity to Advantage

Alan O’Connor

Copyright Alan O’Connor 2013

Smashwords Edition

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First Printing, 2013

ISBN: 978-0-9917810-0-3

A&K Publishing

sales@thrivinginthenewnormal.com

www.ThrivingintheNewNormal.com

The Strategic Entrepreneurship Model© graphic created by Rachel Jacobson

Dedication

This book is dedicated with love to my father Michael John Angus O’Connor, who provided the inspiration, and to my mother Catherine Mary Hilda O’Connor (nee McCrank) who bestowed upon me the motivation, and to my wife, Karen Ruth Nicholas who rendered the realization and the actualization possible. Thanks to these three amazing people in my life, all that was needed for me to do was contribute the perspiration.

Acknowledgements

Moving a book along a pathway from concept to publishing is not a sprint nor is it a marathon. It is a relay race where the baton is handed back and forth from the author to an incredibly large number of supportive friends, family, and even complete strangers. It is not possible to name everyone who helped me win this competition against myself but there a few very special people and some incredibly important organizations that must be recognized individually for their unique insight, impact, and involvement. A huge thank you to Cindy Pinkstaff-Miller, for all those times you talked me off the ledge and back to my desk to keep writing. A special thank you to Janet Hatanaka, as a published author, cousin, and friend; you were uniquely qualified to teach me the craft and the business of writing. A thank you to Jenel Bode for all those measured doses of ‘Jeneladrine’, that mixture of energy, enthusiasm, and encouragement you expertly administered when my vision of a finished book seemed like a bridge too far. And a humble thank you to all the businesses, associations, economic development groups, and business support groups of Asheville and Western North Carolina who appear in this book, for demonstrating to me in real time that those who say that it cannot be done need to get out of the way of those who are already doing it.

Introduction

Is it just me or have we all had enough talk about doom and gloom? As small business owners, entrepreneurial managers, and hard working employees, don’t you think that this sputtering, slow growth economy is just really getting old? After 4-6 years (depending on how you count) of low customer demand and increased competition and competitiveness, isn’t it really past the time for a change in our fortunes?

After all, we did choose to live our working lives in a small business for many reasons other than same old, same old. Among these reasons were a craving for action and an ability to do our own thing. We are independent people by profession and passion, and it’s only natural for us to not be enjoying this economic flat-lining very much.

Being action oriented and doing our own thing have at times been a blessing while at other times been our curse. However, with experience and lots of do-overs, we have learned to temper our entrepreneurial nature. Self-reliance, self-motivation, and self-determination are our values but we have had to learn to use them like golf clubs. Depending on where our ball lies and the new situation in which we find ourselves, we take pride in selecting the appropriate club and striking the next shot with confidence.

Lately, this golf game of business has shaken our normal confidence. We know that we are facing the recovery shot of a lifetime. We question is whether we have the right club in hand to engineer our return to the fairway, let alone to go for the green. The green, metaphorically speaking, is that green called money; you remember, that stuff we need to survive and maybe once again thrive in the marketplace.

A recovery shot in golf can be done in one graceful stroke. We all know that is not going to happen in this new economy. It may take us one, two, three, and maybe many more calculated recovery swings. The good news is that as small business owners we can do our own thing. Our club selection and the choices we make on the number of recovery swings and distance are within each of us.

The number of swings and the distance the ball travels with each swing will dictate whether we recover our life soon or spend the rest of our life in recovery.

In this book, we will not talk much more about the game of golf. We will however, spend a lot of time discussing business and the need to strategize and execute our sustained economic recovery. We will explore some of the small business pressures and the responses that some owners have initiated to cope with the increased competition and competitiveness in this new economy.

This new economy now has a name: the New Normal. For those waiting for things to just get back to normal as they so often did after the previous seven recessions (during my lifetime), this Great Recession 2008-2010 is a very different kind of recession. For one thing, this recession is forecasted to persist for another 5-8 years. Previous recessions came and left in 1-2 years and in many cases were not even noticed in some industries.

Some of the major characteristics of this New Normal are slow growth, low customer demand, and hyper-competition. They are being felt worldwide and by almost everyone in almost every marketplace. These effects present us with both an opportunity and a threat. That threat part is self-evident: if we do nothing but retreat, cut, and contract, we will eventually fail.

The opportunity part is less obvious but it is the subject of this book. The opportunity calls for a change in our base of thinking. By embracing the New Normal’s negative characteristics that are affecting your customers, suppliers, and competitors as a source of competitive advantage and leveraging some timely innovative strategies, we can gain and sustain an ongoing competitive advantage. In other words, we can leverage the disadvantages in the new economy for all into select competitive advantages for us.

By creating a continuous stream of temporary competitive advantage, we can then leapfrog the competition and emerge into the new economy in a repositioned way. Becoming a more nimble company accelerating out of the slow recovery process with more speed, agility, and reach we will not only survive, but steadily begin to thrive in the New Normal.

This book wishes to appeal to the entrepreneurial spirit comprised of self-reliance, self-motivation, and self-determination. These are the core values of every small business owner. We then want to propose a new base of thinking; specifically, to slightly shift our mastery of traditional entrepreneurship to a more strategic approach.

Traditional entrepreneurship was developed over many years in a continuously growing economy and it is based on opportunity-driven behaviors. The New Normal, for all the reasons that we will examine in this book, requires a mastery of strategic entrepreneurship. Strategic entrepreneurship is based on advantage-driven behaviors where the mission in a slow growth, hyper-competitive marketplace demands the creation and execution of a continuous stream of temporary competitive advantage.

Among the many helpful tips, strategies, tools, and techniques that you will find in this book to support your transition to becoming a strategic entrepreneur, you will find a new management model: The Strategic Entrepreneurship Model©. This innovative management model will not only serve as a framework to guide your transition to strategic entrepreneurship, but also as an ongoing management tool.

There are approximately 30.1 million small businesses in North America and they employ about 132 million people. This means that we are certainly not alone in our challenge to confront and conquer this new slow growth economy. In support of these millions of entrepreneurs and the millions of hard working people in the small business communities across the continent, there are also millions of very talented and motivated professionals working in the economic development and business support services.

These small business support organizations, agencies, universities, and companies would welcome the opportunity to work with you to achieve the level of growth and prosperity that we all need to thrive in the New Normal. In other words, as small business owners facing the transition from traditional entrepreneurship to strategic entrepreneurship, we are not alone unless we chose to be.

Doing our own thing does not mean that we have to go it alone.

This book will point to those stakeholders in your business community who are standing by to hear from you.

In my six decades in the small business community, living and doing business in four different countries and in both global hemispheres, I have never met a small business owner whom I did not respect. Entrepreneurs are fascinating people because they are builders who have often made something out of nothing.

More importantly, every day they put their creations and hard work to the test of making a living. They must do this in a competitive environment. This means that by necessity, if not by nature, entrepreneurs are already strategic. What is left to be done, and the goal of this book, is to help small business owners grow their strategic talent. By being better at strategy, we increase our chances in surviving and ultimately thriving in the new economy.

In addition, once the small business owner has committed to the shift from traditional entrepreneur to strategic entrepreneur, this book will help guide the further shift of their small company from a traditional entrepreneurship to a strategic entrepreneurship. Creating and executing strategy is a team sport and requires your entire company to think, process, and eventually adopt a complete company culture of strategy.

During my years as an entrepreneur in the software industry, I belonged to an international association known as TEC, first as a member, later as a Chairperson and still later as a speaker. I am still informally connected to TEC Florida, now called Vistage, and lately to TEC Canada, and this allows me to remain current with the thinking and the business issues being confronted by the members of this 15,000 strong small business CEO organization. Many of these small businesses are of the 10-250 employee size with annual revenues anywhere from $5M to $100M annually.

There have been some business needs within these small businesses that have remained consistent over the years regardless of the economy. Two of these are the small business owner’s need to get more pro-active leadership from their employees, and to create more and better competitive strategies.

The only thing that has varied about these two needs from the old opportunity-driven economy into the new advantage-driven economy is that they have shifted from desirable to mandatory requirements. If you want to Thrive in the New Normal, these two needs shift to becoming critical success factors. This book has taken a strong focus on how to deliver on both these critical small business needs.

When my father died in the mid-1980s, a piece of me died with him. At the same time, a piece of me was born. The piece that died within me was my innocence. The piece that was born was my experience. Losing the one to gain the other was not fun but it was a necessary transformation in life that we all must face to reach the next level of maturity.

In a much less personal and difficult way, when the economy died during the Great Recession of 2008-2010, a part of all us died too. Our innocence in business was slain and if yours didn’t die then, euthanasia is recommended now. Our former business innocence was hatched and developed at a time when traditional entrepreneurs were nurtured by decades of continuous opportunity is a continually growing economy. Even a blind squirrel can find an acorn in a growing market.

The death of our business innocence gave birth to a new business maturity within all of us whether we wanted it to or not. This new heightened level of business awareness is growing and developing, now to be tested in what has become an age of temporary advantage.

Increased competition and competitiveness have wiped out our innocent notion that a competitive advantage can be sustained over the long term. Our new experience is identifying the need to create a steady stream of continuous temporary advantage in its place. The new reality is that any innovation or unique value differentiator in the marketplace will be disrupted in an accelerated, competitive way within months instead of years.

Our innocent opportunity-driven behaviors are now being replaced by advantage-driven behaviors based on need. If this is not the case in your business or your industry yet, it soon will be. This new level of advantage-driven behavior is creating a new breed of entrepreneur; the strategic entrepreneur. There is an epidemic of entrepreneurial transformation in progress that in some cases is conscious and in other cases subconscious. Make no mistake, this epidemic is underway and no one is immune.

My hope is that this book will represent an entrepreneurial transformation portal through which small business owners can safely and swiftly make their passage to strategic entrepreneurship. The journey can be made manageable and even fun at times if we interact with our peers and support our fellow employee travelers. My goal and the goal of this book is to help you accelerate the trip.

By starting now and using this book as a guide, we can spend less time in getting there and more time in being there.

Enjoy the ride!

Setting the Stage

Chapter 1 - The Sinking of the USS Good Times

The Beginnings

A very long time ago, I made a career choice to live my working life in and around small entrepreneurial businesses. I know now how risky my decision was then, but freedom is a strong motivator. At that time in my life freedom was ‘just another word for nothing left to lose’. Entrepreneurship is as close to freedom as you can get in business.

Being an entrepreneur is like being a commercial airplane pilot. The freedom to fly the airplane comes with the personal responsibility for the equipment and the safety of the passengers and the full awareness that you will be the first person at the accident. But then responsibility is the burden we shoulder in exchange for the freedom of flying our own plane.

Oh sure, way back when, I did try to live in a safer, more secure, and well insulated work environment like that found in larger corporations. In the good old days of the baby boom that was easily done. As a young man in my twenties, I wandered into the workplace innocent and enthusiastic. There were lots of jobs and careers from which to choose so finding a job was not a challenge. The biggest challenge in that time of plenty was selecting from the several opportunities available, the best one for a lifelong career. In those days, you were expected to stay with one employer forever. I did select what I deemed to be the best of the best in the bountiful job basket of 1972 and subsequently set out for a career in that industry forever more. Now how silly would it be for any young person to have a similar initial career mindset today?

Armed with my enormous ego and a painful lack of self-awareness that was partnered with a great sense of false security, I was full of myself but not full of the competencies that would be needed to succeed. But no worries, no hurries, and no drama as this large corporation would train me as expected and then my steady climb up the corporate ladder would be accelerated. I would become a master of the economic universe grasping that brass ring in record time. I was blissfully unaware of where the top was and woefully ignorant of what it meant to actually reach it. The human effort, the mastering of competitive internal company politics, the constant and shameless self-promotion, and the monthly achievement of ever increasing business targets all eventually reached my consciousness over time. In spite of all my expectations, I would not fail in my quest. I concluded that any fellow employee that I could not outwork, I could outlive.

Although it is fun for all of us to think about what may have resulted had any of our career choices been different, the reality is that we will never again be as carefree as in those early days in the 1970s and 1980s. We were sailing with the wind during the very best of corporate times. The strong winds were buffeted by prosperity and choice, and they propelled every career boat forward at speed. In those times of continuous economic growth, our career sails were filled with the power to go anywhere we wanted to go and do whatever we chose to do in our lives. At least that was how we felt and, as a product of the very best of times in the North American marketplace, I am very grateful to all who came before me for having provided them.

However, it wasn’t long into my travels in my new corporate career sailboat that a calm day of reality arrived. My career sails went still and the vessel stopped moving. There may have been milk and honey to be found at the end of the ride, but my map was beginning to show just how long this ride to the top was going to take. I had also figured out that I was not the only sailor nor were we on the only sailboat.

There was a growing perception that I and all the many employees around me in this very large company were but very small minions on a very large ship in the middle of a very large ocean. My feeling of self-importance was the first thing to sink under the waves of this perception morphing into reality. This initial view of my diminutive stature in being an employee second class grew into a sensation of complete disillusionment when I was informed by more senior peers that my fears of being insignificant inside this large corporation were very well justified.

They used a different metaphor, but the outcome of their imagery for me was the same. They explained that not only were we all little cogs in a very large wheel, but that very large wheel was also only a small cog among many other small cogs in even larger wheels so that in the grand scheme of things, in a global multi-national corporation we were insignificant. Arrrrrgghh! There could be only one response for me, and that was to figure out how to stop all these cogs and wheels so I could get myself off this bus to irrelevance.

As singer Bob Seeger laments in Against the Wind: I wish I didn’t know now what I didn’t know then. Innocence is bliss, and there was no young man as blissful as I. As it turned out, I didn’t know squat, and I never even came close to living the corporate life that I thought was my destiny. Over the wall I went to entrepreneurial redemption, and it was the best thing that ever could have happened to me and to Corporate America. We both went on our separate ways to success and glory.

The feeling of being infinitesimal inside the greater workings of Corporate America is a price that many employees still pay to be secure in their jobs. I understand that, and I respect it too. Not everyone has the luxury or the ability to take the risks a new entrepreneurial entrant into the marketplace can take. But for me, escape was the only solution and escape I did.

My escape in the beginning was from the frying pan to the line of fire. Joining small business then could be compared to leaving the sanctity of Chicago, St Louis or Toronto in the early 1800s to jump into a covered wagon and join in pioneering the North American West. The open range of entrepreneurship lay ahead and in the expanse small businesses were spreading out across the nation like wild flowers across the prairies. Big banks didn’t need us, and business development and support services were rare. Oh well, I would just have to make it on my own and find a way to succeed in spite of the obstacles.

I never looked back again with either regret or envy. Life in the small business sector has been the ride of my life that now extends into its fifth decade.

The Life of an