Dustin Wells

Wharton on Dynamic Competitive Strategy

2009-10-20T20:51:00.004-05:00

I just began reading a new book, “Wharton on Dynamic Competitive Strategy” by George S. Day and David J. Reibstein. I can appreciate different points of view and approaches because I use what I consider to be the best from each school of thought in order to form “right fit” approach for me. In this case, I have a strong opposition with strategic development methodologies presented in this book. While I am sure I will get value from these concepts, I have a strong bias against approaches that seem to be hyper-focused on competitors – what they are doing, anticipating their reactions, their next moves, etc. versus internal innovation and value innovation for clients.

This book outlines 7 core areas of developing a “dynamic competitive strategy.” Of the 7 core areas, 1 is focused on actual custom feedback and interaction – which could be considered one of the most important, 3 are focus on competitors and what they are doing or might do, 1 is focused on how public policy might impact your strategy, and 2 are focused on the actual company’s strategy and alternatives.

I am a firm believer in being proactive in an approach to find and keep ones competitive advantage. To me this means paying less attention to what a competitor is doing or might do and focusing more on a client’s needs or unmet desires along with ways to create more value – or “value innovation”.

While I will continue to explore this view point on creating a dynamic strategy because I believe there will be value that will help me shape my own approach, I am hesitant based on the initial experience with this book. It is possible that this approach to strategic planning does not apply to me, with a business in our current revenue range or vertical market. It seems like this might apply better to a commoditized industry.

I would like to believe that there is a common, core approach to strategic planning and value innovation that is agnostic to a company’s “age” in their lifecycle.

Question Everything...(within reason)

2008-10-30T23:19:00.001-05:00

One of my co-workers requested I write about lessons learned in starting a business and failing, and lessons learned from starting a business and succeeding - both of which I have done. As an aside, success is measured in many ways - in both experiences I mention above, I consider successes because of the lessons learned. These experiences were preparing me for future challenges, and I was more prepared when I met these challenges due to my past.

There are many, many lessons learned through experience, but I also did not have to learn everything the hard way. I was able to share experiences with those that had already been where I was heading, and I learned a great deal in these relationships - and continue to do so to date. I found that nothing can replace mentor relationships or what is learned through experience. I continue to get value from these relationships and continue to learn new things daily.

With all of that said, I decided I would pick out one very important lesson that I learned through my first business venture. This business started with a great plan...so great in fact that we beat out over 300 entrants and won a business plan competition sponsored by the Austin Business Journal, KLBJ 590, and the University of Texas Business School. The plan was flawless - well almost.

We had our formal business plan that addressed the product, the market, the management, sales plan, etc. We also had a financial projection workbook (in excel) that could do back flips. The entire financial model was driven from roughly 10 key assumptions. Some of these included the average price per month per subscriber, the percentage of subscribers we could capture per client, the length of time a subscription would last in months, and more. The values and basis for our assumptions we largely based on what the competition was doing at that time. There were only two major players in our space in the country at the time. They looked successful, so if it works for them it will work for us.

Off we went to sell our great new service. As things progressed, we realized the feedback we were getting from prospective clients went against everything we assumed in our financial model. In fact, we missed the entire boat on the correct pricing approach. When we went back to revise the plan with the new pricing model that the market would support, the business outlook changed drastically.

Ironically, as we were starting to figure this out and shift gears, we learned that the two major players in the market were bleeding cash - but at a much higher rate than we were. They too had to adjust because the approach that we all thought would work was not supported by the market.

The lesson learned - question everything.

Back up key assumptions with real data and the real market. I now think through new ideas, projections, assumptions fully and then flip ideas upside down and find a way where it will fail - and then adjust. I involve other trusted advisors and colleagues and share my ideas with them. I learned they will see things from a different perspective and find holes that I did not see. Nothing will be perfect, but I want to best chance at success. I recognize that a healthy dose or skepticism combined with the feedback of others has proven invaluable.

As an aside - I also learned producing big, elaborate business plans is not necessarily the best approach for me. Keep in mind I still believe it is important to think through all of the details and each area of the business as well as to build and communicate a long-term vision. However, memorializing this into a formal business plan has not provided value for me. I prefer to organize this data into working documents that grow with the company, rather than a formal plan that I dust off every quarter to see if we are on track for our goals.

A Tribute to a Mentor

2008-09-17T22:10:00.001-05:00

When I first walked into his office, I think he saw me as another "kid" that was trying to make it in a new business. I was actually just coming off of my first venture, that I did not find to be widely successful (in a commercial sense). My state of mind coming into his office was one of optimism sprinkled with a bit of desperation. I had spent a year and a half in my first business with no financial success to show for it. My goal with the new business - start small and make enough to pay the bills.

I do not recall the first meeting in great detail, but I do recall the primary goal from his side (or what I thought it was) was to offer some advice and try to scare me off into getting a "real" job. He seemed like a stern man and spoke slowly with great attention given to each word and syllable. He was not one to speak for the purpose of speaking - but rather make very directed and pointed comments with very specific goals in mind. I, on the other hand, was in the phase of life where I was uncomfortable with silence, and therefore felt the need to continue speaking just to fill the air. As I presented my business ideas, he took aim one point at a time and shot them down. It seemed like he was being very hard on me - but in a gentle coaching sort of way. By the end of the first meeting, I had been thoroughly scared.

You can imagine his surprise when I showed up again the following week for some additional scaring. This week seemed to be some of the same - not much in the way of jokes or smiles. Just an old guy giving me a hard time.

I came back the following week, and then the following week, and the following week, and continued to do so for roughly 2 years. We became good friends over that period and then continued to visit many more times over the next 5 years. I learned more from him than I ever could have learned in school or on my own. It was not just about business. He taught me life lessons that I still hold onto today and will continue to use forever.

He passed away in March, 2008.

It has taken me until now to begin realizing the value of lessons and principles we discussed. Like many great artists, their work and legacy live long beyond them. It is not until they are gone that we being to realize the real impact of their influence. The real impact of their work is only recognized when it is viewed under a new paradigm. When we are ready to fully accept it, we will reap and enjoy the full value intended by the creator (or mentor in my case).

I learned that while I did gain a great deal of value during our relationship together, I was only comprehending our discussions at an intellectual level. It is not until now that I am starting to uncover more meaning that was not apparent before. At the time these lessons and messages were received, I was unable to see what was in front of me. I would like to think this new awareness means I have reached a new plateau. I am eager and excited about what I stand to continue discovering into the future as I grow and change and reflect back on these same lessons and conversations. The most exciting and fulfilling idea is learning the lifetime value of important relationships. As I reach even higher plateaus of enlightenment and understanding, I will see even more of the true intentions of the creator.

Not a day goes by where I do not think about his words. I am grateful for all the wisdom, friendship, and guidance he gifted to me. I will surely continue discovering his true intent and new lessons into perpetuity.

Thank you Alvin Hurwitz for making a difference in one person's life and family.

Starting a blog...

2008-09-08T23:11:00.001-05:00

I am finally making the leap and commitment to starting and maintaining a blog. I have hesitated for a while because I felt like I have little to say or show others since I am still in a continuous state of learning and personal development. With that said, here is what you can expect...

The goal of this blog is to get ideas and experiences on "paper" so I may see where I have been in thoughts and exploration. In addition, I hope that by recording my thoughts, observations, and experiences, I may start to see patterns, trends, or other connections I might not have been able to see otherwise.

So why not do this in a private journal? While I do not expect to have many (or any) readers, in using a public format I hope to do the following:

Encourage challenges and healthy debates, that will make ideas and concepts presented here much stronger.
Share my experiences, ideas, and thoughts with a small hope that it may serve to be valuable to others, just as I have received similar value through peers, mentors, and colleagues.

On a final note, the content of postings will vary widely. I plan to explore business and theory, personal development, technology, human relations, personal relationships, and more. Anything is fair game for now.