The ability to say ‘No’ is a superpower. It helps us focus. Self-improvement books repeatedly cite this principal for personal growth. This principal equally applies to businesses as well.
Every business prepares a strategy or view on which markets and products to work on. They accordingly allocate their budget, resources and bandwidth. However, our research shows that businesses find it hard to stick to their well thought of strategy and plans.
Why? Because they are tempted to take up any new opportunity or new business that knocks at their door. This takes away from the limited resources and bandwidth for other planned activities and digresses them from their strategy and plans. Result being that they are left at the mercy of the market and lose focus on planned growth.
I am no stranger to this issue. At Tofler, we spent our initial years trying to take up all kind of customers – Banks, NBFCs, Corporates, Consultants, etc. We tried to make the product to please all of them. Eventually, we were so divided between all the target markets that we got nothing much done. The clients were using Tofler’s product, but we had no growth plan because we could not focus in one direction. We learnt the hard way to say No to other projects and focus our energy on adding value to Indian corporates.
But that does not mean that you should not explore new opportunities and be rigid with your plans? You sure should explore new opportunities. But you should have a process to evaluate them and to note whether they achieved your purpose. If not, then do not repeat them.
How to evaluate new opportunities? There are objective ways to determine the IRR of new opportunities and projects. Since financial modelling is not always feasible, I suggest following a subjective approach:
- Write your thoughts when forming your strategy: Write your thoughts when you form a strategy. Strategy is a broad path you decide to follow for a period. Why you have chosen to follow a market, a process, or a product? Why you do not want to approach other markets, or manufacture other related products in a period? Pen your thoughts.
- Write your thoughts when taking up the new project: When a new opportunity comes and you want to take it up, read the above note. If you still want to take up the new project, then write your thoughts again. Why you want to take it up? How do you expect it to turnout? Why is it worth digressing from your strategy? Note down your thoughts and expectations in detail.
- Write your thoughts, when finishing the project: Once the project is over, write your thoughts again on how it turned out? Did it meet your expectations? If yes, then would you like to take such projects again and modify your strategy? If no, then why not? What problems you faced?
Writing your thoughts is important. It helps you form ideas. You think out loud when you write. It brings clarity.
This is one way in which you can focus on your startegy and meaningfully digress from it. Write your thoughts when you build your strategy. Write your thoughts when you digress from your strategy to take up the new project. Write your thoughts when you finish the new project. Accordingly modify or don’t modify your strategy.