This week’s focus: A few years ago I learnt to sail dinghies. For the first few days I was focused on one thing: not to fall in the water! I saw capsizing as a sign of failure and I was determined not to fail. On the third day the wind blew stronger and we were learning more technical manoeuvres and, unsurprisingly, the boat tipped over and I ended up in the sea.

I quickly realized that falling in the sea was not the worst thing in the world, and that the best way to understand how to balance the boat and maximize its speed was to, sometimes, go beyond its natural limits.

It’s the same in business. Failure is the Siamese twin of innovation. The secret to success is not to avoid failure but to fail – and learn – as quickly and as cheaply as possible.

Off the record: Right Next Time by Gerry Rafferty

You’ve got to grow, you’ve got to learn by your mistakes

You’ve got to die a little every day just to try to stay awake

And when you believe there’s no mountain you can climb

Well if you get it wrong you’ll get it right next time

© Stuart Cross 2012. All rights reserved.

1. Ambitious goals. We set demanding future goals that are a constant focus for everyone in the business.
2. Broad scope. We want to create entire new businesses and product categories, attract new customers and enter new markets.
3. Experiment fearlessly. We know that failure is inevitable in any new venture and use trials and prototypes for rapid learning.
4. Real customer insight. We find new ways to discover customers unmet needs and ask ourselves how we can improve their lives.
5. Systematic approach. We have effective processes and systems for generating, evaluating and investing in new ideas.
6. Broad engagement. We involve the whole organisation in innovation and invest in skills and capabilities accordingly.
7. External relationships. We don’t try and do it all internally, and work with external partners to identify and drive new growth.
8. Performance management. Our people are rewarded on the basis of their ability to develop and deliver new business ideas.
9. Strategic Alignment. We have identified priorities for innovation that are clearly in line with our strategic objectives.
10. ‘Stealing’ Ideas. We actively seek new ideas from other industries and markets.
11. Exploiting the unexpected. We use unexpected successes and failures – our own and others’ – as a starting point for innovation.
12. Exploiting external changes. We actively track customer, social, economic and technology trends to identify new ideas.
13. Sales and profit impact. Over 40% of sales and 30% of profits come from products and services introduced in the last 3 years.
14. Brand enhancement. Customers and staff are loyal to us because of our innovation track record.
15. Innovation pipeline. Our current pipeline of new innovations is likely to grow the business by over 25%.
16. Company value. Our excellence is rewarded by an advantaged competitive position and a premium in our company’s value.

What your score means:

Your score is less than 40

Inside-Lane Incrementalist. Although you may believe that innovation is important for your business, you are simply not walking the talk. You continue to play it safe and focus on making minor improvements to existing products, services and processes. You need to find ways to increase your organisation’s appetite to experiment with new ideas, its willingness to accept and manage failure with new ideas and its commitment to build the processes and capabilities necessary to drive the profit growth that the leading innovators enjoy.

Your score is in the range, 40-65

Middle-Lane Follower. Your innovation processes may be reasonably strong, yet you may find that you are not making major advances. You are likely to be overly focused on copyting and responding to your competitors’ latest movers, and are reluctant to make the bigger steps that will drive your business forward. You should look at ways to increase your appetite and ability to take on and manage the risks of bolder innovation activity.

Your score is more than 65

Fast-Lane Innovator. Your company is set up to develop and deliver true innovation into your markets. You are likely to be seen as a leader in your market and achieve results that are superior to your competitors. The key watch-out going forward is to ensure that your innovation remains relevant in the context of fast-changing business environments. Remember, nothing fails like success, and you must ensure that you continue to be proactive in raising the bar and driving future growth.

Want to find out more? Download my free e-booklet Fast-Lane Innovation by clicking here, where you will find 15 powerful lessons in improving innovation for your business.

© Stuart Cross 2012. All rights reserved.

This week’s focus: Pace is far more important than accuracy in securing business success. Three months ago, for example, I ran a workshop for a client to help them develop a new strategy. I recently followed up with my buyer and found out that the team are still developing their plans and still haven’t got round to action. Yet many of the themes we developed could have been acted on almost instantly. The solutions may not have been perfect, but I’m sure they would have been good enough and would have allowed the business to learn faster and more cheaply than is likely to be the case now.

In Aesop’s fable the tortoise beat the hare, but 99 times out of 100 the hare is likely to cross the line first, and if I were a betting man my money would always be on the hare. Let’s face it, it’s a lot easier to teach a hare to be disciplined than it is to teach a tortoise to be fast.

Which kind of organisation do you lead – a tortoise or a hare?

Off the record: The Distance by Cake

As they speed through the finish, the flags go down

The fans get up and they get out of town

The arena is empty except for one man

Still driving and striving as fast as he can

One more thing: Thank you for all your replies so far, but I would like to repeat the offer I made last week. Do you have an insight that you’d like to share with others – or songs that you think carry an important or witty message for business leaders? If so, I’d like to hear from you as I’m aiming to introduce periodic ‘guest star’ Friday Focus editions. Just hit reply to this note and tell me your story, insight and song!

© Stuart Cross 2012. All rights reserved.

Many organisations use balanced scorecards. These scorecards are great for reviewing progress but I find them to be poor at developing strategy. Strategy development requires a single goal, a goal that rises above all the other objectives that you have.

In my book, The CEO’s Strategy Handbook, Ian Filby, the CEO of DFS said “One of the big strategy lessons I have learnt is that a strategy has to meet a clear goal. Without agreement about the goal you can’t settle on your strategy.”

Ian’s absolutely right.  He and his team have settled on a profit goal for their business, but your goal doesn’t need to be financial. Stephen Ford, who runs Avon business, the cosmetics business in Australia and New Zealand, said this in the book: “I cannot let the strategy be seen as an abstract idea that has no relevance to everyone’s day-to-day activities, otherwise it will die.  Consequently my first strategic decision was to set a clear stretching performance goal for the business, having looked at various options with my executive team we settled on a goal of receiving 1 million customer orders.  We chose this goal because, all things being equal, growing orders will drive our profitability, but we also used this goal because it’s memorable – everyone can remember the 1 million order target.”

Ian and Stephen have clarity on their #1 goal – what’s yours?

© Stuart Cross 2012. All rights reserved.

This week’s focus: I have found one of the key secrets to success in business. In fact, I believe that if it were implemented properly most businesses could quickly grow revenues and profits by 10% or more. Here it is: know your medium-term objectives!

Yes, I agree that this not a spectacularly new or innovative insight, but over the past week or so I have come across three leadership teams that are suffering because they don’t have clarity on what’s expected of them beyond, at most, the next 12 months. This means that initiatives that don’t pay back immediately are not being pursued and that these executives are paying little attention to new, potentially exciting growth opportunities.

So, what are your medium-term goals – and those of your organisation – and if you asked your team about their 2-3 year objectives, what are the chances that they would give the same response as you?

Off the record: The Road To Nowhere by Talking Heads

Well we know where we’re going

But we don’t know where we’ve been

And we know what we’re knowing

But we can’t say what we’ve seen

One more thing: Do you have an insight that you’d like to share with others – or songs that you think carry an important or witty message for business leaders? If so, I’d like to hear from you as I’m aiming to introduce periodic ‘guest star’ Friday Focus editions. Just hit reply to this note and tell me your story, insight and song!

© Stuart Cross 2012. All rights reserved.

It’s only by trying something new, getting it wrong, identifying what’s worked and what hasn’t, and improving your solution until you create something that works. This is true in product development, operational improvements, leadership and strategy – and virtually every other walk of life.

The chart, above, is taken from my book, The CEO’s Strategy Handbook (you can find out more and download a free chapter by clicking here), and compares and contrasts ‘traditional’ ways of trialling new solutions (the top chart) – which commonly involve significant amounts of detailed planning and discussions before getting to action – with more interactive, action-based learning approaches (the lower chart).

How are you developing new solutions for your business? Are you spending your time, resources and effort generating and defending plans or are you focused on rapidly creating and testing your latest prototype?

© Stuart Cross 2012. All rights reserved.

I’ve just finished a short project with Spotless Punch, working with their UK leadership team to develop a growth strategy for the business. The company develops and manages a portfolio of innovative, market leading brands and proudcts in niche home care categories, and their brands include Colour Catcher, Vim, Oust and Punch shoe care.

Here’s what the UK Managing Director, Cliff Stubbs, had to say about the project:

At the end of any consulting assignment, you ask yourself if you’re satisfied with the return on your investment. With Stuart Cross I felt we got many times more value than we invested. Stuart was quickly able to help us set compelling goals, determine where and how we could be advantaged against our competitors, and identify and scope initial priorities for growth. Stuart brings real authority to his strategy work – he has both broad and deep experience, a real expertise in strategy, and an ability to engage and work with the most senior leadership teams. I would recommend any business leaders looking to find new and better ways to grow revenues and profits to speak to Stuart.

Are you looking to develop a new strategy for your business or work out how you can grow revenues and profits quickly and sustainably? Please call me on +44-(0)1636-526111. I look forward to hearing from you.

© Stuart Cross 2012. All rights reserved.

This week’s focus: Many business leaders talk about transforming their companies and making ‘game-changing’ moves in their market. The truth of such moves, however, is that they rarely succeed. Most major gains are, in fact, made through a series of smaller victories, not through a single, ‘silver bullet’ solution.

A ‘stepping-stone’ approach to growth builds capability, confidence and momentum without taking undue risks. Aim high, and raise the bar for your business or team, but avoid the temptation to get there in a single leap. Instead, break down the delivery of your goals into achievable, focused steps.

Off the record: Don’t Stop by Fleetwood Mac

Don’t stop, thinking about tomorrow

Don’t stop, it’ll soon be here

It’ll be, better than before

Yesterday’s gone, yesterday’s gone

© Stuart Cross 2012. All rights reserved.

Your strategic focus dictates the type and form of organisation required for success. As set out in the chart above – which is from my book, The CEO’s Strategy Handbook – a company that is following a product leadership strategy needs a very different organisation from one pursuing a price leadership strategy.

Many problems for businesses begin when they fail to align their organisation with their strategy. One client of mine, for example, was pursuing a service leadership strategy but had essentially structured its business as a convenience leader by limiting its range, centralising production and becoming increasingly inflexible to local customer demands.

Which type of competitive strategy is your business pursuing? Only by understanding the answer to that question can you build the necessary organisation that will deliver your success.

Want to find out more? Download a free chapter of my book by clicking here.

© Stuart Cross 2012. All rights reserved.

1. Strategic CEOs continuously raise the bar
2. Strategic CEOs share a bigger picture
3. Strategic CEOs create options
4. Strategic CEOs are willing to make clear choices and trade-offs
5. Strategic CEOs break through the silos
6. Strategic CEOs build a strong team around them

Have you got what it takes to be a strategic CEO?

© Stuart Cross 2012. All rights reserved.