Earlier this week I had dinner with Michael Davies, founder of Mercator Partners, and some colleagues from the Centre for Scientific Enterprise and London Business School. Davies, like me, is an alumnus of the school’s MBA degree. He is is advising on the plans to establish the first heavyweight Institute of Technology in a European business school.
Before the dinner, I’ve saw Michael lecture to the school’s course on New Technology Ventures. he explained ten rules which sum up much of his global experience. These are my rough notes, which cannot do justice to Michael’s insights.
- 1. What ever you, do it with feeling. You need to show that you and your people are passionable about what you do, because business success in technology is all about people.
- 2. It’s not about the technology. Businesses fail primarily because of the people and secondly because of the market.
- 3. Timing, timing, timing. You need to show that your product won’t fail in the market. So explain how buyer preferences, cost factors and the supply chain are making your idea better now than ever.
- 4. Focus intensely on the customer’s context. Solving the clients’ problems will show that you can unlock value, as well as give a good home to a young technology.
- 5. Think Niche. If you focus your business on the niches where the value to the client is greatest, then you’ll be able to get to break-even quicker – and without taking on external debt or equity. Expand your reach in stages, boot-strapping where ever you can.
- 6. Co-operate and co-ordinate with other market participants. It’s too easy to see other suppliers as competitors. Don’t focus on taking market share from other firms: that simply reduces profit in the market. Focus on working together to educate and grow the market opportunities for everyone.
- 7. You need to offer a distinctive value. If you’re not offering something distinct, you won’t be able to generate value for the customer and you won’t be able to capture value for yourself.
- 8. Develop robust causal models, more developed than simple linear models, that help you explain and anticipate market dynamics.
- 9. Emphasise slowly accumulating a diverse team with coherent views. Don’t hire people like yourself, but don’t hire people who don’t share your values: no wonder that needs to be done slowly!
- 10. Show candour: don’t kid yourself or your stakeholders about the pace and problems.
Taken together, these are great recommendations. Some of them are especially useful for small firms [including Lighthouse] but these tips also give a lot of insight for those wanting to understand what attributes are seen as being valuable in technology leaders.
Many of Michael’s points could sound obvious to North American readers, but some European executives will find these tips had to accept. European market success is more likely to be about the technical perfection than about emotional engagement. and that reflects a gulf of cultural differences that mean that success factors differ between the regions of the world.