‘Skunk works’ were originally brought to the attention of  the mainstream by Tom Peters and Bob Waterman some 30 years ago in their book ‘In Search of Excellence’ after they observed several American companies using them. The concept, a group within an organisation given a high degree of autonomy and unhampered by bureaucracy, tasked with working on advanced or secret projects, (Wikipedia.)

It’s design was based on providing a supportive culture for maverick thought, creativity and ridding the company of any fostering problems. Ensuring that any issues are dealt with at the root cause and helping people focus on positive activity rather than negative, protective thinking rampant in so much of business.

Later developments have seen them evolve into more sophisticated occasions. These very events were aimed at fostering trust as people could tell the truth with fear of reprisals. These were not your ordinary team meetings or the regular operational get together. These were different. Set aside, these very meetings encouraged the businesses capacity to change, innovate, solve problems, achieve goals and not to mention embed an active, honest and open culture.

The results can be staggering. They create a rapid, constant flow of information, broaden colleagues perspective, offer new ideas and embody a climate of little fear and no reprisals. It pushes companies to value input, transparency and promotes critical thinking. If you think your business could do with a dose of that, set up an event once every quarter and make sure they happen. 

We either love or hate it. Some of us can spend hours immersed in it, others, would rather swim through nuclear waste than even spend an hour trawling it. It’s a turn off, boring and for many, we try and avoid it at all cost.

But what about strategic detail? Strategic detail is not about crossing the ‘t’s’ or dotting the ‘i’s’ that’s proof reading. It’s not about cross checking things in minute detail, that’s auditing. Strategic detail is like looking at a valley of fields in June and seeing more than just the green. You see much more than that. The different variety of flowers, the lack of hedgerows, there are more rabbits than there were last year and how the wind changes the flow of the grasses.

Strategic detail is about looking at your business from a distance, identifying the detail and understanding it’s effects. It’s impact on various departments, customers, staff. It’s ability to either stifle or innovate. You may never touch it, but you need to feel it. You need to know where the detail is and its effect. Then you can decide what detail you get involved in and, of course, that depends on what you see.

As small business owners we have a tendency to get involved in everything or lots of things. We market as if we need to sell to all customers/consumers. We network at all the events that are going on in our area. We get involved in all the aspects of our business. That’s why we never have any time!

Time is limited so we have to be careful where we spend it. Better to focus on the three things your business must do right, no compromise, no cutting corners. In fact, what makes you potentially world class. It’s a case of what are the priorities and concentrating on those.

If you are a design agency, perhaps it’s about fabulous, cutting edge design, recruiting world-class people and marketing. If you design and manufacture innovative products its product development, production efficiency and marketing. If you are a creative it’s your reputation, credibility, bespoke products/solutions and marketing. A restaurant, possibly amazing food, world-class customer experience and marketing!

One observer of the Welsh Rugby team who won the six nations in 2008 said that the key to their achievement was that they identified what the critical success factors were in the game and went out and did those abundantly well. It’s the same for small business. Concentrate on 3 – 5 core things and stick to what you are good at, or, need to be brilliant in and stop worrying about the elements that are not mission critical.

A fabulous book and worth the £8.99 price tag. Charles Leadbeater offers an insight into how companies might operate in the future as a result of the switch to mass innovation from the mass production of the past. As he admits, some businesses won’t be affected as much as others, but some of the concepts are challenging, thought provoking and downright fascinating. 

It’s got me thinking particularly about seeing a small business as a community not a team of people. If he is right and a culture of sharing is just around the corner, thank goodness for that, its about bloody time!

Not taking advantage of technological changes – Its here and here to stay. Using technology effectively is a common sense approach to ensuring you stay one step ahead. Using technology is essential. A basic requirement; electronic database of your customers can lead to your ability to design individual customer experiences for your top 20% of customers.

Technology can help stabilise your marketing budget and even bring a better return on investment. Emailers instead of hard copy newsletters. Blogs that allows content to be updated on a regular basis instead of static websites, social network sites leading to collaborative working with like-minded people even competitors. It can even build your brand equity by allowing your customers insight into the company’s culture. Not only that, but instead of just communicating with your customers you can have open, honest conversations with them.

When growth slows, you can usually pin the cause to one of the series of five reasons provided. Its not easy sustaining that growth over a long period of time and you certainly can’t do it on your own. It requires the business owner to renew their commitment to the businesses long-term purpose and seek out new opportunities or ways of doing things that will lead to capturing a new zest for growth.

An immense dose of leadership is required. It takes small business owners with courage, motivation and conviction, able to withstand criticism, to face their fears head on. Essentially, inspiring their company to rejuvenate its commitment to growth, even with severe challenges ahead.

Managing instead of leading – You have no choice anymore. If you run a business, you are pre dominantly a leader. Not a manager or technical expert but a leader. That’s your specialist subject. Hire the technical whizz kids, recruit the product developers, engage with expert marketers, outsource or get someone else to manage the finances. If your business is to grow, you have to take a step back from being involved.

You have to move to a facilitation role. Understand you’re not the most intelligent or competent person in the business, but that your expertise now is in driving people towards that common purpose. Its not about controlling but inspiring, its about doing the right thing not doing things right, its about seeking change not order, not about organising but about engaging with people and, above all else, trusting people to do the doing.

Failure to adapt to shifting customer trends – Customer expectations have changed, however, most businesses are failing to respond to this. The traditional differentiators have almost disappeared; product, price, place etc. Social media is heavily influencing the agenda. We are a lot less impressed with average stuff and customers can find you easier than you can find them! When all things are equal what is it that people buy?

Mass marketing and weak universal appeal are dead, yet we still need to create and develop a loyal customer base. That means developing a new relationship with existing customers and those prospects that are showing signs of being great future ones.

Not all customers are equal. Businesses that succeed recognise that and organise their business accordingly. It requires two simple strategies. Customer acquisition where you are trying to change the prospects mind and customer retention where you are trying to maintain the mindset. The two need a slightly different approach. Any proactive marketing and customer loyalty programs need to focus on the great customers not attracting the poor ones.

It’s a case of not fearing customer rejection but customer indifference.

Failure to adapt to new marketing approaches – The old ones are the best. Not any more. The world is littered with both small and corporate businesses that failed to manage this one. The development of new technologies and the internet has suddenly restored a lot more ability to the small business in terms of marketing.

Many small businesses have become wedded to a marketing strategy they created when they first set up and continue to use the same tactics even though the world has moved significantly on. Small businesses are not conglomerates and must face up to the fact that they shouldn’t be attempting to market like that.

Word of mouth is having a resurgence, social media is allowing us to build our credibility and reputation like never before and to a worldwide audience if we desire. No longer do we have to spend large amounts of money on newspaper adverts, radio advertising, brochures that are immediately out of date, exhibitions that cost thousands and rely on a declining footfall. Why? Because they simply don’t work. 

Marketing for the small business has suddenly got a lot more cost effective and easier to do. Yes you need huge amounts of imagination and creativity to implement it, but if done properly, will bring a better return on investment and a better customer.

Loosing ones nerve – In the initial stages the start up business owner takes a risky path. Whether it’s a huge investment of money, re-mortgaging, giving up a great job or spending time away from family and friends. He/she is not afraid of digging deep into their pocket, nor their soul, to make things work, deliver a great product, find fantastic customers and grow their business.

Then it reaches a critical point. A place where everything that stimulated the company’s rise starts to slowly diminish. The owner suddenly acquires deep pockets and short arms. Risk becomes too risky and the business starts to lose touch. Touch with its customers, touch with its people, touch with new products/services and touch with new trends and thereby starts the path towards decline.

It can happen for a number of reasons. The owner is financially comfortable and won’t risk that being compromised. The owner is tired. Lets face it, it takes an enormous, unwavering amount of energy to grow a small business and sometimes, we just run out of steam. Or, in many cases, that’s as far as the expertise, knowledge and skills run and its time for someone else to take over, either through acquisition or through a new management team. Recognising this five years ahead of it happening is critical so succession planning can take place.

Planning that far ahead can mean the difference between your company being worth a good sum or absolutely nothing.

Many small businesses have a natural life cycle. They grow steadily over several years, flatten out and then either decline over a period of time or remain in a state of survival until the owner retires or dies. This pattern of ultimate survival will, in the future, no longer be possible. Too much competition, too many inspired people and too many great products will not just nudge a lot of small businesses into oblivion, they will give it a good old, hard boot!

However, there is nothing natural about this life cycle. Far from it! The problems that lead to ‘flattening out’ and demise are failures in leadership and a focus on short terms gains for the owners of the business, rather than following a path of sustained business growth.

The causes can be traced clearly to a number of pitfalls that business owners succumb to over time. Over the next few days I’ll be posting a series of causes. The first one I’ve written about before:

No clear purpose – With no clear purpose it’s damn difficult to drive your business towards its destiny never mind being able to rally the troops and clearly state what your business stands for. With no purpose and no common route map for that purpose, any business will struggle. Purpose gives meaning to what the company is, why people work there, why people buy its products or services and why it actually exists.

Imagine getting in a car with a group of friends and driving off into the sunset without little idea of where you’re heading. Makes a great road trip but its too risky in business, if a little stupid. If it doesn’t get you in trouble immediately, it will in the long run as your company grows and the people working with you demand it. Anyway, how the hell can you create a great team loyal and committed to you without a common purpose?