Blog Entry

Sep 12
2011 

How Wobbly is your Business?

Here is a term that has made it into our vocabulary a bit too much lately – “wobbly”. Suddenly everything is wobbly – our economy, stock market, jobs market.  The obvious connotation is “uncertainty” but wobbly has also become a cop-out term for not knowing where something is headed. It is a sign of times we are in – or so it feels. Uncertainty in economy leads to uncertainty everywhere else.

My advice – something I try to follow rigorously at work and and personally  – when you are surrounded by uncertainty, do the opposite – be decisive. This is especially true for high tech companies.


After a nice rebound in economy over the last few years, high tech companies find themselves generally running efficiently, with productivity at a new high. So, it is no longer about just cost cutting your way to better earnings. It is time to actually be decisive about your investments when chips are down. Why? Because history shows (Cisco, Microsoft in early nineties) that companies come out ahead when uncertainty clears and market opens up because those investments pay off.

One of the areas where companies rethink and reinvent themselves in such times is looking at how they go to market – and whether changes in that area can pay off with strong revenues and profits in the future.  Here are some examples of what they are doing:

  1. Looking for new ways to drive revenue from existing IP. Many companies who have traditionally relied on their hardware business to make money are looking at how they monetize their software intellectual property created over the years. Faced with pressures from depressed IT spending on hardware and virtualization, they are not trying to fight the trend; instead, they are highlighting areas of growth – software being one of them. This also means that they are open to new concepts when it comes to how they have worked with customers in the past.
  2. Focusing on customer experience. We live in the new Twitter world where people expect instantaneous results. customers of high tech companies are no different. They expect more automation across the board. If they are licensing your product, they expect to have precise data on how licensing is working, what they are entitled to at any given point, what their usage is,etc. And oh by the way, do not expect them to wait until 9 am on Monday morning to find this out. They want to log in to their portal right now and get all that information.
  3. Improving operational efficiencies. Okay, I did say that you simply can’t cost-cut your way through bad times anymore given productivity gains of last decade. But, I might have exaggerated a bit. There is always some opportunity internally to look at your processes – across the organization – how much time your product teams are spending on new business models and pricing ideas, how much time it takes them to implement those ideas in the product, how much time it takes your operations group to actually execute and deliver the product to your customer, etc. No doubt you will find that you can simplify and get more efficient by investing now and at the same time meeting objectives 1 and 2 above.

So, don’t just try to wait out these conditions – take control of your business, use the opportunity to evaluate your goals, and do something about it! Don’t get wobbled out.