Big Red Car here. What a day in the ATX. Bluebird, crisp. Great day.
The Boss was up before the sun and was all about getting stuff done today. Checklists flying.
For a seasoned businessman, he really gets a lot of work done. Lot before other folks have rolled out of the fart sack.
Got me thinking about how the nature of business has changed in the last 47 years. How the New Economy compares to the Old Economy.
Here are some thoughts.
Old Economy v New Economy
There was a day, grasshoppers, when businesses operated before the advent of the smartphone, computer, Internet. Hard to believe when you see how businesses operate today. Hard to believe if your work experience is limited to the startup eco-system.
As The Boss likes to say — your generation did not invent business or sex.
Even today there are a lot of private businesses — even entrepreneurial businesses — that have not fully embraced the realities of how one can operate a business using today’s New Economy capabilities.
Where are the differences to be found?
This shows up, in particular, in the following functional areas:
1. The amount of introspective thought invested in understanding and crafting the underlying business model including fundamental organizational documentation;
2. The documentation of Vision, Mission, Strategy, Values as a basic building block of management philosophy;
3. A written management philosophy;
4. The business planning — both strategic and tactical — for the enterprise. A huge number of otherwise very sound businesses have NO written business plans of any kind;
5. The creation of SMART objectives that tie the strategic and tactical business plans to the vision;
6. The financial modeling supporting the businesses plans, in particular, with alternative outcomes and scenarios including different views of the capitalization table and balance sheet;
7. The quality of the thought, written documentation and modernity going into the marketing of the business with particular interest in the 4 P’s, graphics, packaging, pricing, branding, messaging, communication and social media;
8. The nature of the engagement with customers including such basic things as building useful customer databases and channels of communication (advertising, snail mail, direct mail, email, text messaging, social media messaging);
9. The testing of the company’s effectiveness and customer satisfaction through real world feedback;
10. The nature of operational analytics and reporting and the development of KPIs and dashboards;
11. The nature of the company’s public presence including website and social media;
12. The branding — hate that word — and graphic standards of the company’s public presence;
13. Knowledge of the company’s competitive position in the marketplace and that of their competitors;
14. Documentation of the company’s basic processes through graphics and checklists;
15. Basic human relations planning including job descriptions, compensation, benefits, training, continuity, professional development and retention;
16. The use of technology as a driver of modernity, efficiency and certainty;
17. The use of finance as a driver of growth; and
18. The use of scale and growth dynamic as a means of increasing the bottom line.
This list could go for another 5-10 elements but you are getting the idea.
That great little Old Economy company which has been around forever — proof of concept be damned — might be a real power house if you could get your hands on it, slap it with a checkbook and transform it into a New Economy company.
In the next few months, we will take one or two topics a week focusing on the Old Economy to New Economy transformation and discuss them.