“These two questions are the fundamental questions in strategy. How can you understand your industry and your competitive environment, and how can you understand how to position your company within that environment?” Michael Porter
Being able to assess your own company as well as those of the competition correctly is a skill every entrepreneur must develop. This skill helps look at the state of a current business objectively and ensure it is in line with what it started out to do. If it has changed along the way, you need to be able to identify the reasons for the change correctly, and justifiably, for whether it has served the company well. Very often, well thought out organizations, have simple targeted reasons for existing and cater solely to those needs in an effective and efficient manner. When a company attempts to manage too many fronts without adequate resources, unnecessary complications arise in their business model.
Like any other skill this one will take time, commitment, and experience to master. I am involved in the assessment of some start-up ventures due to my linkage with several entrepreneurial clubs and societies. Over the years I have come to rely on a couple of basic and fundamental questions when assessing a business. These are simple questions which are aimed at the core of the business, where it wants to be, and how it plans on getting there. As a business owner myself, I continue to ask myself these same questions about the businesses I manage, to ensure that we are on track for where we want to be and have adjusted our strategy correctly, in light of any changes which may have occurred along the way.
Over the course of this week I will go through five basic questions which can be used to assess a company at a very basic level. I hope they will help those who use these questions and will enable them to channel their thought process in a more structured manner when assessing a business. In the near future, case studies will be added to this blog, these will be ideal to test one’s understanding of this week’s blog series. If anyone would like to have their company or business model assessed please send me an email at blog(at)usmansheikh(dot)(net). I will be more than happy to take a look at them and send you some feedback.