Here are mine:

• Where we can have fun, 
• Where we work as a team, 
• Where hard work is rewarded, 
• Where we can make a difference, 
• Where we are challenged and can grow.

Go through the revenue being generated and find the opportunities to increase sales by just 1% – heck find more if you can but look for 1%.  Don’t do what the airlines did and impose a baggage fee or look for ways to gouge your clients for more.  No way!

Look for a way to sell 1% more or increase value for your client or find just one more client or increase traffic to your site by just 1% more.

Its challenging but I bet that if you turn the subject to finding 1% more in revenue to your leadership team the mentality will begin to shift from cost cutting to growth.  Growth is what we all need now.

Just so we are on the same page – Cannibalization in this case does not mean eating people it has to do with the introduction of a product or service that eats in to a company’s primary revenue stream. 

Many companies have faced this issue in the past – some famously have clung to their antiquated business model or product and rode it into the ground. A few examples: The Recording Industry for not embracing digital downloading; The Movie Industry in resisting but ultimately embracing the VCR; and even in my own career as EarthLink did not want to offer an Email only subscription for fear it would increase the cancellation of people paying $21.95 per month for dial up when they currently had high speed access and were keeping their dial up account only to maintain their email address.  Hey people figure this stuff out!

So what is the problem here?  Why should you embrace new products that could ultimately cost you sales in your primary business?  Single answer is that if a new product comes along or business model that greatly lowers the value proposition of your current product or if the new “thing” adds more value to a certain segment of your current customers, then someone will offer the service to your customer and your customer (at least a portion) will buy it from them and leave you.  Bottom line is that a portion of your clients are gone as soon as the new option becomes available.  The big questions are how many and how soon?

As a leader of a start-up you it is rare indeed that your new business will face the challenge of cannibalization – but if you are selling into a market where your product risks cannibalizing your potential client’s primary revenue stream you need to consider these issues and combat them.

Here are my three steps to confronting/battling those who bring up cannibalization as a reason NOT to adopt your new product, service, or business model:

1. Show that the change will happen and what effect it will ultimately have on the business if adopted by competitors (The Doom Case).  Make no mistake it is not a question of “if” but “when”.
2. Create the financial models to show the impact of new product adoption allowing for cannibalization to occur.
3. Demonstrate or provide a plan on how the business can be changed where by the new product if adopted could boost the business without destroying the entire revenue stream (This is the action plan behind the business case in step two).
4. Give anecdotal examples of how cannibalization issues have affected similar businesses.

A word of warning – this is BIG risk stuff – Do your homework!  In my experience the change usually does not happen as quickly as you think (so you have more time to milk the old model or products) and there is not perfect information (so your customers will not immediately change to the new model or product). 

Also, pray that you are not working for the Encyclopedia Britannica as Microsoft rolls out Encarta where a $1,300 set of books are replaced with a $50 and then free online version offering greater quality.  That spells GAME OVER!

1. Communicate the key driver and the goal to each and every person in your company.  Every person should know what the key metric is what your goal is and what you attained in the past.
2. Post the goal around your shop – write it out so each team member is constantly reminded of the goal.
3. Repeat the goal and the current status at every function, meeting, or gathering.
4. Ask for the teams help in reaching the goal – they have great ideas ask them to think.
5. Become the walking embodiment of the goal by discussing the goal each day with someone on your team.
6. Reflect on the goal and your plans to achieve it everyday (do this alone in a quiet place and do so by thinking about what you are doing and what could be done).  (Bonus method – 6 not 5 as previously indicated)

You will find that soon the goal will be achieved and you will be setting a new higher goal.  Look you have heard this before so why am I telling you this again?  You are busy – being pushed to your limit with the needs of your company.  You are being pulled in the direction others want to take you.  Stop!  Dig in your heals and pay attention to what drives your company.  Focus and you will reap the rewards of that focus.

Identify these key metrics and focus on them – set a goal for them make them come alive in the minds of your team.  Make sure that the key driver creates the value for your clients and your business.

One of my mentors tells me that his key metric is subscribers.  No care for revenue as he is building a “Tribe” (if you do not know what I am talking about run out and buy Seth Godin’s book Tribe).  You see he has identified what creates enterprise value for his shareholders (I think he is the only shareholder).

Once you have identified the key value driver focus on it relentlessly  no matter what it is.  Yes you have to watch your cash and your sales and etc etc.  Many people only watch those things and then end up focusing on the wrong value drivers or too many “Key Metrics” and end up creating nothing remarkable.  Google originally wanted to be the best search engine period.  Amazon in the begining wanted to focus on expanding the books it had the ability to sell you.  Jack Daniels focused on distilling whiskey.

Find your value driver and focus on it!

That is it – the secret to all living.  If you can create more value you will get more value.  Think about it – if you give more love you will be loved.  If you are friendly more often – more often people will be friendly to you.

In business you should seek to add value to your clients and partners – if you create a lot of value you can charge a lot of money (capture a lot of value) for your services.  If you run a business that has pricing pressure and you can barely pay your bills then you are not creating value.  EBay created value by creating the world’s largest garage sale.  Sears created value by bringing goods to the American farm families and captured much value fifty years ago only to be replaced by Wal-Mart who created economies of scale value.  Microsoft created value by placing software infrastructure in the hands of programmers and later by placing productivity software in the hands of “Office” workers.

Create more value than you consume and your life, and that of your business endeavor will be easy!

If you cannot establish TRUST then any business relationship is doomed.  If you lose trust you need to stop everything and repair the situation and once trust is fully lost then the chance of a go forward relationship is largely lost as well.

Work to build it – work to keep it – if you do you will be able to maintain the relationships necessary to be successful.

The entire Seventh Army is at a standstill due to this “mule headed” donkey.

Up pulls Patton, he jumps from his jeep and in one swift motion pulls his ivory handled revolver – shoots the donkey in the head and has it flung from the bridge thus removing the obstacle.

This is a great story that illustrates the point that swift decisive action is sometimes called for and that of a great success principle of personally taking decisive action to remove obstacles to fulfill one’s mission.  I ran into this very issue this week in my current business.  In two cases members of my team took on the role of the MP and not that of Patton.  Be the general take decisive action and “shoot the donkey”!

It is EASY, CLEAR priorities, QSC in Wendy’s case, that help you and your team deliver a consistent client experience and for your team to focus on doing the things that create the greatest value for the client.  So for our IT team QSC equals:

1. Keep the servers running.
2. Take care of Client technical issues.
3. Develop next version of web interface.

for Marketing QSC =

1. Promote the client’s programs
2. Promote the company

Simple priorities help everyone on the team to act in a coordinated way to deliver great results.