Four ways to lead the change
In a time of unprecedented market change, what does it take to stay ahead? Opening Macquarie’s Perspective event, Head of Business Banking Dean Firth told the audience of over 400 business leaders, “being ahead of the curve is what keeps you awake at night. But it’s also what gets you up in the morning.”
And that demands a focused culture of innovation.
“Innovation is not about doing something completely different with new technology. It’s the combination of existing technologies in new ways that is making a difference,” said former Countrywide UK CEO Grenville Turner.
Over the two-day event, an inspired line-up of speakers shared their own perspectives on what that takes.
Start by fixing customer problems – not business problems
When the internet took off in the late 90s, many media companies decided to sell their existing products and services online. However, this simply solved their own business problem: selling more CDs, books or travel guides. It failed to fix the customer problem: improved ways to listen to music, read or travel.
“Customers will always pick the path of least resistance: they don’t care about your business. If there’s a better solution, they’ll go,” former Lonely Planet CTO Gus Balbontin advised the audience.
Netflix co-founder Marc Randolph says ideas come when you “train yourself to look for pain…and solve the problems close to home that you see every day in your work and your customers’ lives.”
Countrywide UK looked through a customer lens to generate new revenue opportunities. It used its extensive estate agency network to create a ‘one stop shop’ for homebuyers, offering a range of services to make the process simpler. From conveyancing and surveying to mortgage broking, general insurance and life insurance, these diverse and recurring income streams underpinned its profitability.
You need a system and a culture to try lots of ideas quickly. That’s what start-ups are so good at. That’s why they can take down big companies.
“If we hadn’t been ahead of the curve in these initiatives, we wouldn’t have survived (the GFC),” noted Grenville. However, he also emphasised that sales remains the beating heart of the business. “It may have only been 20% of our profits, but we needed the branch presence and customer relationship to sell the other services.”
Our perspective: Look at the whole customer journey and their potential lifetime value to your business to provide for them in new ways.
Innovation is a volume game – so become an ideas machine
Gus suggests that innovation is the result of three qualities: curiosity, courage and resilience. "Your brain will reward you with lots of ideas if you become curious, but remember most of your ideas are rubbish... Innovation is a volume game... That's why you need courage to share bad ideas and the resilience to patch your ego and do it all over again."
Our perspective: Find a way to build ideas quickly and cheaply to test customer interest, so you can innovate without disrupting your main business.
Innovation takes curiosity, courage and confidence
Is your team suffering from change fatigue? The bad news is, innovation doesn’t suit everyone. “The people who are good at building processes are not the same people who respond to quick change,” said Marc. “You need to build a team of people who are ready for it.”
He says the most successful innovators he meets (and invests in) have three things in common: a tolerance for risk, an idea (or hundreds of ideas), and confidence.
“They are comfortable starting down a path without knowing where it will lead. And they believe that if this idea doesn’t work, they’ll get it the next time.”
Gus says businesses are the sum of its individuals. “Your business will behave as the average of your people. You need to be adaptable if your business is going to adapt. It starts with you.”
Our perspective: You need people who love the fact their job is different every day.
You’re not facing one big threat, but hundreds of small ones
Grenville likened the current competitive landscape to facing thousands of ants, rather than one big bear. “Estate agents used to think of competition as the best local on the high street. Now it’s online agencies, software companies, comparison sites… and each one might take a small per cent of market share but they’re all over you, clogging up your business.”
“You never know who your competition is going to be and how they’re going to come after you. Learn how to disrupt yourself to avoid being disrupted,” added Marc.
However, it was also clear from the event that many business leaders have already reframed their perspective on competition: from threat to opportunity.
During the panel discussion, proptech founder Mina Radhakrishnan revealed she uses fellow panellist Mike McCarthy’s YourPorter service for utility connections, while agent review platform Open Agent is now partnering with traditional agencies to manage their pre-sales lead generation.
Our perspective: Innovation does not need to be a solo pursuit. Re-think the nature of your business ecosystem by partnering with potential competitors.