The business lifecycle (explained by looking at political parties)
Everything created goes through a lifecycle. In business it is called the business development lifecycle and its full of traps and opportunities. Understanding this can offer some compelling ideas, actions and momentum to building your business to the next level. Pavlo looked at the three leading political parties in these elections to explain the structure of the business development lifecycle. EFF represents start-ups, DA is going through the growth phase and the ANC are mature. The way that you deal with particular elements of how you build that business over that lifecycle is going to be different, read more below and listen to the full show here.
Let's start with our Start Up, the EFF.
As far as leadership is concerned it's individual driven. The track record of the individual is crucial and built on personality. There needs to be big drive and high energy and hopefully that individual has had a few failures and learnt from their mistakes. Julius Malema is a perfect example of this. He has a long political history. He failed in the ANC twice and reinvented himself. It’s like working in a large corporate, seeing what they’re doing consistently wrong for a niche of customers then leaving to create your own start-up in that space to serve those customers . The vision is informed by what's wanted. Through the insight gained in previous experience, the focus is the customer and what they want.
The messaging of a start up is about the future - the promise of what the customer will receive if they work with you. And once a start up gets that customer they have to hold on to it. Word-of-mouth is the cheapest, most effective marketing strategy. The EFF have been very clever in this regard - they've used the imagery of the military and have recruited their ambassadors and disciples. Like a normal business start up the EFF have the opportunity to find niches that are not properly understood by the established incumbents and are not satisfied with their current service. The risk however is always the inability to sustain the business beyond 7 years.
The DA is going through the growth phase.
At this point, the leadership is team driven. An emerging team that holds diverse skills and develops a reputation for hard work. Their vision is informed by what's worked and working. The DA will look at its success in the Western Cape for example and focus on scale. Their messaging will be about their customers and what they have given them. The risk at this stage is that you get impatient and accelerate too hard before you are ready. Growth needs expansion and consolidation on an ongoing basis since you are lacking sufficient resources. At this stage you have the opportunity to build systems to support targeted growth.
The ANC has reached maturity, like an established corporate it is stable with good structures in place.
The leadership at this stage needs to be strong. The strong man figurehead holds the fleet together, but the advisors are more crucial. The vision at this stage is normally driven by the past and quite often big business, or the ANC in this case, starts believing their own PR. For mature businesses the messaging is about history and loyalty - tying in customers and creating high barriers to exit. Jacob Zuma told ANC members that they owed it to their history and ancestors to remain loyal. The risk at this stage is that trapped by the images of your past you are too comfortable and too slow to respond to changes. At this stage, it's important to cannibalise your own business. That means reinvention, either through creating specialist, focused task forces and allow them to work freely within your framework or through acquisitions.
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