Friday, September 28, 2012

Selling the Entrepreneurial Dream is not productive

There is a growing industry of consultants, incubators, accelerators, books and courses centered around the "dream" of being a successful entrepreneur. The reality is that most of the individuals or organizations making money in this space are useless. This is a sector of the economy that is unproductive and for the most part does not add economic value. 

The resources that any country has can be put to use in a number of ways. If these resources are applied in a productive manner, economic growth will ensue. However, misapplying these resources can generate no growth or contraction for the economy.

In a situation where young graduates are encouraged to innovate, to become entrepreneurs without the proper support, this is an un-productive use of resources.  These graduates might be better used in an existing organization (be it at a reduced rate of pay). Fueling this misappropriation of resources are a host of organizations, who make their livelihood by selling a dream, appealing to emotion rather than economic sense.  All too often I hear of events entitled "Master Class" or "Pitching superclass" etc. There is no quick fix to innovation or entrepreneurship and I shudder even at the names of these events. The participants in this industry are focused on "quick" courses, quick fixes with unrealistic claims. Education and support is not a quick fix and there are no quick solutions or methodologies that will make it work. If there were, we soon would reach a saturation point, where everyone would be successful and innovating quickly (unlikely to be sustainable). However, with proper and well considered education there would be some success and at least a number of well or more educated individuals and organizations.

Today, the focus is often on raising funds, pitching creating business plans. These things, however, are secondary to developing an idea into a business. Funding, pitching and planning comes after the development of the idea which is aided by some fundamental business and economic skills.  Resources would far better be utilized investigating market opportunities, teaching individuals how to validate a market and helping with process development (how to develop business, software and other processes).

Monday, September 10, 2012

The road not taken and the death of traditional retail

Fuel prices are increasing and they are unlikely to decrease in the near future. Time is valuable, in our fast paced lives it is a valuable commodity. Moreover, the amount of specialized products is also increasing and this trend is likely to continue.

The true experience below illustrates why traditional retail is dying and why data overload and inaccuracy is also going to become ever more costly. We will all need to use technology in more productive ways and once implemented to maintain the data which is an integral part of digital technology.

My grape vine arrived overnight in the post, ordered online and delivered by a courier company. The online instruction video insisted on planting quickly and using a "friendly" fungi applied to the roots, called "Mycorrhizal Fungi". I hopped into the car and headed down to the huge home superstore 7km from my house.

Once there I headed for the gardening section and scoured the huge isle for the Fungi. There are hundreds of fertilizer and other products in this section and despite taking my time, I was unable to locate the product. I was also unable to locate a staff member sufficiently experienced to know what this product was. The first few sent me on a wild goose chase around the building. Finally, I went to information and we were able to ascertain that the product does exist, but was out of stock.

I then did a search on Google for a nearby garden center and headed to the car. I followed directions, through heavy traffic, only to discover that the Garden center had become a garden training center and did not sell products to the general public. The data online was out-of-date and inaccurate. This episode took me 3-4 hours and I was unable to locate the product.

I arrived home, went online, found more than 5 suppliers of the product, purchased it and it arrived the next morning.

There is nothing very profound about this experience, however, it highlights the deficiencies of traditional retail. It also highlights the fact that generalist data sources will be hard to maintain and always develop inaccuracies. There will always be opportunity for niche databases that are limited in scope, but well maintained and accurate.

Traditional business will certainly continue to need to update their information infra-structure and online presence, meaning they will undoubtedly need to contract-in or develop competence in new technology areas. The ability to do effectively do so relies on human resources who are well versed in the application of this technology. This is an area which I feel has lagged behind the technology itself. There is little information, on how to evolve a business in this way and put more simply there are not very many good resources which deal with the process of software creation, whether it be a database, website or system of bespoke software ( this is the reason we created OpenCTO , in an attempt to improve the quality and dissemination of this information )

If, as trends suggest, we are heading to an ever more technology orientated economy, we should logically apply significant effort to ensure that this technology is produced and maintained efficiently and effectively. This would suggest that we invest significant effort in the processes needed to apply and later maintain this technology. Is this the case at present ?

I have spoken to hundreds of entrepreneurs who still struggle with relatively simple issues, getting online, developing websites and e-commerce solutions. Ensuring that what is purchased is delivered and correctly hosted. I have heard of numerous situation in large multi-nationals of the incorrect specification and application of technology, lack of redundancy, back-up, data integrity etc. The ability to deliver this aspect of business is only going to become more essential in the coming years.

PLEASE VISIT AND REGISTER AT OPENCTO - To create, focused on start-up ideas, a standardized lean methodology and process for the conception, design and development of Internet and mobile technologies.