In the previous topics we tackled some very important questions about how to grow a business sustainably: understanding your core purpose; understanding the landscape and understanding what influences your customers.
Going through the process of answering these questions will have identified some market opportunities: the question is how do you decide if these are opportunities you want to pursue?
The critical question is can you pursue these opportunities and, if so, should you. There are many tools to help with this, primarily around assessing where your business is currently, and therefore the gaps to fill if you are to pursue these opportunities. Here are few that might help:
- SWOT – something we came across in a previous blog, it’s a good idea to revisit this with a view to understanding what gaps exist in the business as it stands.
- Another useful tool is the Resource-Based View, which examines the strategic resources a business can exploit to explore new opportunities. VRIO is a way to remember the questions to ask here:
- Value: a valuable resource means a business can enhance its competitive advantage
- Rare: a rare resource is only controlled by a small number of businesses
- Imitation: a resource that’s costly to imitate means other businesses are at a disadvantage
- Organisation: an appropriately organised business can maximise the utility of a resource
Intellectual property (IP) is one example of this: unique IP is valuable, rare and costly to imitate but a business must be organised correctly to use it, e.g., with correct contracts and licenses in place.
- The Business Model Canvas is a popular framework to use when developing new business models, looking at value proposition, customers, partners, finances and infrastructure
- The last tool I’d suggest is Theory of Change: this is a useful check of thinking as it forces us to think about what we are trying to achieve, and the inputs necessary for that, a valuable logical process from input to activity to output to outcome to impact.
Final thought – do not get caught up in the paralysis of analysis. All these things are useful to do but essentially we just need yes/no answers to two questions:
- Can we pursue this opportunity? Do we have the resources, skills, etc.? If not, what would it take to put them in place, and can we do that cost effectively?
- Should we pursue this opportunity? Does it align with our purpose, can we do it profitably and sustainably?
The danger is with all these things is that someone else will move quicker than you!
If you need help with any of this and you are a sole trader or a business in the creative sector in the North of Tyne Combined Area, please get in touch Catherine.johns@wearecreative.uk
Webinar 4 – Know Your Journey – Download Slides