Internet Strategies for the Small Business Investor: 7 New Rules of Play
- Internet Strategies for the Small Business Investor: 7 New Rules of Play
- Rule #2: Test the market, then capitalize on findings
- Rule #3: Develop just enough to achieve your goals
- Rule #4: Develop iteratively, testing and refining between iterations
- Rule #5: Use what's at hand, before investing in new tools
- Rule #6: Develop partners, allies, and networks
- Rule #7: Take advantage of the unique strengths of the medium
Integration specialist and Internet consultant Laura Brown defines seven new rules of play for the small investor seeking to enter the Internet arena.
By Laura Brown
Small business and individual investors must redefine the rules of play, if they hope to benefit from the many strengths of the Internet. Since many Internet strategists assume a starting price of $1-2 million per year to place a business on the web (see net.gain by John Hagel and Arthur G. Armstrong, or the Corporate Internet Planning Guide by Richard J. Gascoyne and Koray Ozcubukcu) and follow-on costs of up to $15 million are considered reasonable, small investors must find ways to turn their weaknesses into strengths.
As in the competitive approach that David B. Yoffie and Michael A. Cusumano called "judo strategy" in the January-February 1999 issue of Harvard Business Review, the small business or start-up can turn their opponents' resources, strengths, and size against them. Start-ups can be flexible, quick, and can use the Internet to level the playing field. They can use "just in time" and "just enough" strategies to prevent wasting limited resources on premature expenditures of time and money. And they can seek partners and allies for the strength of interdependency between equals. What emerges is a new set of rules for Internet start-ups:
Rule #1: Think big, but start small and build, learning as you go
Rule #2: Test the market, then capitalize on findings
Rule #3: Develop just enough to achieve your goals
Rule #4: Develop iteratively, testing and refining between iterations
Rule #5: Use what's at hand, before investing in new tools
Rule #6: Develop partners, allies, and networks
Rule #7: Take advantage of the unique strengths of the medium
What I've learned is that you need to shift your way of thinking back and forth from big-business "corporate-think" to small-business "net-think". Or, if you like, from big-business hierarchical to small-business relational. Shifting back and forth means staying in the middle, and it allows us to make a departure from the "all or nothing" way of planning.
We have to learn to take the next small step, without knowing what all the steps will be in advance. In project terms, this means planning for the next 30-90 days, and adjusting as you go. It means changing the way you think about commitment and investment. You make small investments, and see how they work, then you adjust, and make another small investment. The trick, I think, is holding your vision and the larger commitment to seeing it through, but letting the form of it shift and grow as you go. This is how iterative market research is done.