Entrepreneurs and corporate leaders have to identify the best strategies to drive success of their businesses. How does one think about startups or innovation strategies that might work? These strategic techniques are often different from what might be the topic of discussion in MBA classrooms - startups are often resource starved, do not have ample credibility in the marketplace yet, are often trying to push half-baked ('beta') products and services, and in many cases their markets are also not ready for the prime time yet. Yet, strategy plays a critical role in the success or failure of the startup experiment.
The author is the Chairman of SiliconIndia.com and MetricStream. An internet pioneer, he was the co-founder and President of WhoWhere? Inc., a Internet directory services company acquired by Lycos in 1998 as well as eGain, an online customer service company. Sinha can be reached at email@example.com
Strategy #1: How are You Different?
This is an important question for all entrepreneurs to answer for themselves. How are they going to be different from other players in the marketplace? For example, Apple focused on 'UI'as the big differentiator while it thought about its iPhone product line. Similarly, promising startups like Facebook saw an emerging need in social networking, which was not best served by established players like Google or Microsoft. Likewise, startups like salesforce.com recognized early on that salesforce software is best delivered through the Web as a service.
SiliconIndia.com community itself recognized the need for building a professional Indian community, when nothing like that existed. Existing players like the big media companies in India are focused on the wider consumer segments, while the global networking sites like facebook, myspace, and linkedin are serving everyone around the world, hence cannot dedicate 100 percent of their focus on India. The key question for the entrepreneur is to identify a niche or a market need where you can indeed be different from the established players.
Strategy #2: What Capabilities areYou Building to Enhance Your Differentiation?
Once you have found a niche or a market opportunity, where you can indeed be different, the next big challenge is to put some capability behind your differentiation. The big question is about what you do differently to stay differentiated, and what capabilities are you building within your firm or organization that others are not able to build as effectively? For example, in Apple's case, their experiences with 'Smart UI' with iPods, iMacs, and a brand image of building user-centric products, gave them a real advantage in building iPhones. They hired more UI experts, and out-innovated competition on the product UI axis. Similarly, Salesforce.com, early on focused on aspects like multi-tenancy, self-service, ease of signups, and a fast delivery mechanism of software as a service. They hired employees with Web background, and directed their product engineering in that direction. Established software companies like Oracle and SAP could not easily rival these capabilities, given their products had to be built for enterprise implementations and installations. Similarly, here at SiliconIndia, the focus has been to differentiate on building a team of news, blog, video, event management, and editorial experts who can truly catalog and produce differentiated content for the professional Indian community. The key is that not only is it important to have a unique focus from your competition, you also have to learn to do them differently.