Building an entrepreneurial culture

Last year this time I wrote that you should take an entrepreneurial view of your organisation and start experimenting and breaking stuff. Why? Because if you don’t foster a culture of entrepreneurship and innovation, you’re going to get left behind.

If you thought 2017 was fast-paced and disruptive, hold onto your seats as we enter 2018. Virtually every major industry is going to be shaken up by technology and what it enables. Not for its own sake, though, but because customers demand it.

Start-ups know this and are building their businesses from the ground up to harness things such as cloud computing, automation, artificial intelligence and mobility.

They’re also not asking their people to do stupid, mundane tasks, and are instead freeing them up to be more strategic, creative and customer-focused.

So how do you build a culture of entrepreneurship and innovation? Well, first, you don’t have to be an entrepreneur yourself. Nor does everyone in your business. But what you do need to do is enable a culture that is open to ideas. From anyone. Even ideas that, at first glance, seem to be wild, because you never know where they can lead you.

Take the invention of Post-it notes by 3M employees. In 1968 an employee invented the adhesive, but didn’t really have a use for glue that wasn’t very sticky. It was six years later, in 1974, that another employee made the connection and realised the glue could be used to create a reusable sticky note.

Compare this to Kodak, who sat on its employee’s invention of the digital camera and, according to some versions of the story, the foundation technology of the mobile phone, to avoid cannibalising its existing business. This squashing of ideas ended up in Chapter 11 bankruptcy protection by 2012.

I often write about compiling your budgets with input from the coalface. Getting the input from the people at the sharp end of the spending and making money builds transparency, buy-in and alignment. Of course it also allows you to tap into insights on the ground that you simply would not have access to from behind your desk.

Think of building your entrepreneurial culture in the same way. Ideas can come from anywhere: the new hire who brings a fresh pair of eyes, the junior who lives the same millennial culture your clients do, the receptionist who sees how irritated people get with paper-based processes, and the call centre agent who actually speaks to your customers every day.

TIPS

The only stupid questions or ideas are the ones that don’t get asked or shared.

It doesn’t have to be perfect at first. Ideas in progress are valuable too, especially if others can make them stronger.

Go wide, and get people talking to each other. You never know when and where the lightbulb insight that saves you money, makes you money, or helps you work better is going to come from.

As published in ASA Magazine February 2018 https://www.accountancysa.org.za/building-an-entrepreneurial-culture/ 

In 2018, consider the cost of doing nothing

Depending on your outlook, my column last month would either have exhilarated or terrified you. And whether you are champing at the bit, wanting to embrace the new, digital future of your business or terrified at the thought of robots taking all our jobs, you will need to start making some pretty significant decisions this year. These will need to move your organisation forward, but also give you space to be nimble in the face of future seismic shifts, and finally, should avoid painting you into a digital corner you can’t reverse out of. (Betamax video, anyone?)

It’s a decision minefield, and, my suggestion, which I hinted at previously, is don’t avoid the cost of doing nothing jobs. Those are the maintenance, upgrade and incremental innovation projects that don’t deliver an immediate ROI, but are essential for saving you money and ensuring your survival in the longer term. 

Counter-intuitively, cost of doing nothing jobs probably won’t deliver you an immediate return on investment. What they will do is maintain and optimise systems and processes, and also help you take the incremental steps that make up innovation to take your company into the future. Yes, they divert time and resources away from other activities today, but they avoid catastrophic failures, future-proof your business, and will save you money in the long-run. 

For instance, on a trip last year, soon after I landed in New Zealand, the Auckland Airport was shut down thanks to a fuel line being damaged. As a result, hundreds of planes were delayed at a critical regional hub, and time and money was spent trucking in fuel until the pipeline was repaired 10 days later. A spokesperson explained that the cost of an additional pipeline hadn’t been justified as it would seldom be used. Wait a minute, surely this exactly how you define a backup system?  

Unfortunately, it is hard to quantify the cost of not doing these jobs at the outset. You only know the real price tag if disaster strikes, as Auckland Airport found out. This means it is easy to let these jobs slide to the bottom of the priority list.  

Let’s look at things from another perspective though, and consider the future-proofing role of cost of doing nothing jobs. These projects that can shift the paradigm for your organisation for innovation, growth and success in the future. Hence the danger of not doing them today. For instance, if you are not thinking about or embarking on a project to move your operations into the cloud, you may find yourself left behind tomorrow when your competitors are offering cloud-enabled services and innovations, and you simply can’t. 

Apart from a fixation on short term ROI concerns, there are a number of reasons organisations neglect the cost of doing nothing jobs. In today’s fast-paced world, where we're all running to stand still, it might seem like there is no time to optimise or review your course. Keep your head down and roll with the digital punches. Unfortunately the pace is only going to speed up, so rather consider these projects now.  

Some companies are simply risk averse and would prefer to defer a decision and stick with what they know. Indeed, playing it safe is often rewarded in these organisations as short term improvement in the bottom line tends to focus the eye. Unfortunately, in the 1980s it might have been the case that “nobody ever gets fired for choosing IBM”, but today, this thinking could result in your company not being around tomorrow.  

Finally, many organisations lack the skills and experience to navigate this new, digital industrial era. Today, you need to hire people that have the skills to adapt, and thrive at doing things that automation can’t, and also have the ability to work with robots. An example is accountants being freed up from crunching data, and instead using their abilities to spot patterns, analyse the data and think strategically about how this informs business decisions and then providing strategic counsel for their clients.  

So now what? Firstly, start quantifying the high cost of maintaining the status quo by putting the cost of doing nothing on the agenda. Then, move away from waterfall thinking and learn from agile philosophies and their continuous iteration. This takes the pressure away from being sure you are making the right decision at the outset, to making the decision right for you, through constant improvements and vigilance. Finally, simply decide. Choose a lighthouse project, you may fail but then fail fast, learn and improve.

As published on Accountingweb - January 2018 

https://www.accountingweb.co.uk/community/blogs/kevin-philips/in-2018-consider-the-cost-of-doing-nothing