I recently got sent a link to the report that Ernst & Young launched at Davos earlier this year and it has some important lessons and advice for successful entrepreneurs – you’ve got to become agile.
Davos, you may already know, is the economic summit attended by global CEOs and world economists to discuss the current major business and economic trends and therefore the issues facing their global businesses.
So, essentially, this is top quality stuff – but the question remains – what value or use is this for small and medium sized businesses (SMEs)?
The answer is that what affects our big brothers will impact on us, the successful entrepreneurs, too – only, traditionally, SMEs get to find out about it later. Often, a lot later….
So, interpreting the Ernst & Young report – what can we decipher? Quite simply – if you want to grow your successful business then you need to build agility into its DNA.
Steve Howe, Managing Partner, Americas — Ernst & Young said “leading organizations need to look at talent and the value of different perspectives in a new way to drive innovation, mitigate risk and support new ways to achieve success.”
Mr Howe is encouraging established western businesses to find new ways to drive innovation and mitigate risk. And, in his view, this requires a new way of looking at talent – or perhaps our staff and teams.
Okay, so, we are right back to the issue about people – it is what makes or breaks a successful business. And what the EY team are really saying is that we have to find new ways to engage that talent to bring new perspectives on our businesses and find ways to innovate with lower risk.
How do you do that then?
The most effective way to acheive this flexibility is to create and use flexible pools of local freelance talent.
Also in the report, Donald Sull, Professor of Management Practice at London Business School, expressess the idea that establshed/ western business have high absorbtion rates – that is they are able to weather shocks with a protected core market, diversified cash flow, a strong brand or long-term customer contracts.
However, the risk is that new companies growing up in the large emerging markets (India, China, Brazil for example) have a a much great agility which is what allows them to spot and exploit new opportunities.
He says “companies from developed countries, by and large, have the advantages of absorption — size, established brands, technology, diversification and so on,” however. “lacking these advantages, emerging-market firms typically rely on agility. To me the striking thing is how fast agility can trump absorption.”
So, what Professor Sull is saying is that the emerging market business will thrash the established market businesses – unless those businesses can become agile!
Let’s put it another way – your business will go bust if it doesn’t become agile.
Okay, so getting back to agility – how do you do it? Well, as we said in the beginning, draw in a different perspectives and innovate with lower risk. How do you to this? The only way to acheive this must be to open your business up to more people with a wider range of experiences, whilst reducing the risk.
The only way I can see to do this is to engage with an expanded pool of freelance or outsourced talent – who can get to know more about your business and who are given more opportunity to innovate for you.
I put this to Richard Burton, Brand Strategy and Development, Ernst & Young Global Marketing and he told me
“Finding a way to embrace and leverage flexible freelance talent seems like a very smart thing to do”
So, there you have it.
Looking for more tips on how successful entrepreneurs can grow their business? Check out our 7 Point Plan to Growing Your Business in 2010…