Nothing Compares To You Sheet Music

[Lorna Schildt]

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The 2019 Executive Forums Silicon Valley Member Meeting demonstrated again that Business Owners, CEOs, Presidents and Executives learn best from and with each other. The forum group members and guests enjoyed a morning of education, leadership exercises, business planning and camaraderie at the Silicon Valley Capital Club.

The Blue Ocean Strategy session was led by Dr. Brian Gladden - founder of the Strategy and Innovation Institute and one of the countries foremost experts on the topic. Dr. Gladden has integrated other key tools such as the Design Thinking, Business Model Canvas, and the Balanced Scorecard to create an innovation framework to help firms grow by finding new, un-met demand.

Innovation Problem. Participants worked through an Innovation Readiness Assessment for their individual companies and discussed that contrary to popular belief, innovation is completely different from invention. Additionally, a company can develop a process for innovation just as they develop processes for other key company disciplines.

Strategy Canvas. Using the example of Top Golf, the use of the Blue Ocean Strategy Canvas was explored. As several of the participants had experienced Top Golf, the example resonated in demonstrating the concept of expanding the market as opposed to competing in a fixed market. I had recently visited a Top Golf facility in Reno and witnessed a further market expansion for customers who were able to participate in baseball game simulations, all while enjoying the music, beverage, food, and camaraderie in the Top Golf innovation.

Pioneer Migrator Map. Dr. Gladden led the members through an exercise to create a map of current product and service offering and how those would migrate over the upcoming years. Through the use of this Blue Ocean Strategy tool, members were able to envision how and when innovation is necessary to sustain and grow a business. Included with the discussion was how current Red Ocean products were the fuel that allowed investment in Blue Ocean innovation.

The session workshop was focused on preparing for the next recession so that business emerged on rocket fuel. As the economy is due for a correction, now is the time that the best leaders ensure they have taken appropriate steps to strengthen core business.

Remember and Reflect. A rich discussion was facilitated to get members to think about and recall experiences during the last recession. This "get real" discussion moved beyond the facts and figures from the last recession to reliving and remembering the emotions and personal business impacts the economic slowdown caused. During the reflection discussion, a "then and now" comparison was made of stock market levels (all-time highs), the geopolitical situation (middle east hot spots), and the world economic stability (housing versus tariffs).

Recession Facts. Many of the group were unaware of actual recession facts (length, depth). Although the impact can be severe, the average recession actually only lasts 11 months versus an average of 67 months for economic expansion. Other macroeconomic indicators were reviewed to show the link and offset between a recession and unemployment rates, corporate profitability, housing starts, and the leading economic indicator index.

Industry Triggers. The discussion went deeper to allow members to explore and discuss specific indicators within their industry. These industry indicators are much more impactful and relevant to what a business owner does going forward. Indicators such as building permits, number of RFQs, raw material lead times and price, wage rates and interest rates need to be monitored as they are much closer to ongoing business activity. Participants were encouraged to identify their specific industry trigger indicators and add to their weekly or monthly scorecards.

Preparing for a Recession. A review was made of companies that were well prepared going into the last recession and the positive impact ghat preparation had on their 10-year growth. As shown below, winners (those prepared) emerged with a 14% compounded annual growth rate as compared to the flat growth rate of others.

A four-part preparation framework was explored from the Bain study that indicated the best companies (1) restructured costs without cutting muscle, (2) put the financial house in order (balance sheet), (3) selectively invested in key future growth areas, and (4) were poised and ready for Merger and Acquisition activity.

Making It Real. A scenario planning methodology was presented that allows companies to map out in advance the strategies and actions that will be taken when a key industry indicator passes a trigger level. Through the establishment of an (a) impacted variable and timeframe, (b) a problem statement and scenario description, and (c) a trigger event and an action plan a company can preplan the response for these future events. Through this planning methodology, a one-pager is prepared to guide a leadership team allowing proactivity versus reactivity as shown in the example below.

This scenario planning methodology was reinforced through a case study where each table was responsible for analyzing the case business, reflecting on a particular impact, creating a plan to address and debriefing to the group.

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