Building Your Company’s Next Great Business Line
by Mark Yacano
Over the course of my career, I have been asked to help build several new practices or service lines within an existing business. While there’s a lot of guidance for entrepreneurs bringing new services to the legal services industry, little guidance is offered for the intrapreneur. Taking on the challenge of building a new business for your existing employer is both exciting and intimidating. This post is the first in a series of articles designed to offer advice to those bold intrapreneurs who take the plunge.
Question First – Decide Later
It’s exciting to be asked to do something new and to develop something from the ground up. But you’ll need to embrace the fundamental truth that, between stimulus and response, there is space. Use that space to gather information, ask lots of questions, and make smart decisions. You’ll find that almost all of your questions will start with either “what” or “why.” The “What and Why” line of questioning will provide you with the framework necessary to make mindful decisions about your future. Many of them seem basic, yet time and time again, talented people don’t ask them. Consider these questions before taking on the challenge:
What is the objective? Evaluating the validity of an opportunity without a clear purpose is impossible. Understanding the service or business your employer wants you to build gives you the opportunity to do your diligence on the market. Adding new services or ancillary businesses should be driven by a set of facts that support the objective. Taking measures to capture a greater share of your customers’ spend is smart. So is building services that give your company the ability to work with new customers that respect your brand and reputation. Adapting your company’s core technology to meet emerging markets is not a bad reason, either. Facts are good things. The presence—or absence—of tangible objectives that drive growth often determines the success of new ventures.
Why now? One calculation to consider is whether you’re being asked to be a first mover or join a mature trend. Timing is everything, and being the first mover is not always the best place to start. You must decide if the market is ready for what you are being asked to build, or if your company is too late to the game. Understanding the company’s sense of timing provides good reference points for evaluating the opportunity.
What are the some of the key challenges? Being asked to build a business with no nexus to the company’s existing brand could be a disaster without some fact-based evidence to support the business plan. It’s always hard to offer new services in an area where your company has no brand identity. You’ll need to build your credibility to earn the chance to compete for business—and that requires a strategy. The converse is also true: entering a business that has few barriers of entry and is ripe for commoditization presents equally compelling challenges. You’ll need to scale the business quickly to generate profit in a low-margin environment.
Why me? It’s nice to be asked to take on a new challenge. However, it’s imperative for your employer to define why they selected you. It might be obvious if you’re a proven business builder who has helped your current or past employer add new products, offerings, and services lines. But what if you don’t have that experience? You need to understand what skills and attributes led management to choose you. An opportunity that aligns with your capabilities and fits with your career goals can be rewarding. It’s a sign that you have management’s full support. A lack of alignment is a recipe for failure.
What resources will I have? Knowing what you’ll have to work with is one of the most important questions to ask. Businesses grow at different rates depending on the resources the company is willing to commit. Resources mean a broad range of things: people, working capital, technology, marketing support, and training. You must make an informed judgment as to what you need to do what is asked of you. Running lean in the beginning is normal, but neither entrepreneurs nor intrapreneurs can build a sustainable business model if they don’t have the resources to scale the business when the time is right. The resource plan is a good indication of the company’s commitment to the undertaking.
What is your runway? Gathering facts and understanding timing, resources, and the company’s objectives factor into the time you need to build the business. Both internal and external startups take time to germinate. The evolution of a concept into a product or service that resonates in the market varies greatly. Having a reasonable gestation period should be a big factor in your decision of whether to accept the challenge. You need to understand what the potential startup time could look like and be realistic about the roadblocks along the way.
In our next installment, we’ll go through the process of building a business plan and building a community of stakeholders and sponsors that will support you on this journey. Stay tuned!