The Hindu Business Line : Even a puppy can cast an awesome shadow

YOU run a small business. Such as "a bike shop, an auction company, an ice cream parlour, a sock manufacturer." How to win in thoroughly mundane businesses like these? "An entrepreneur must outsmart the multitudes of competitors, leap to the head of the pack, and become a dominant Alpha Dog," urges Donna Fenn, and helps with `eight strategies' in Alpha Dogs, from Collins (www.harpercollins.com).

First, Fenn lists seven reasons why "there's never been a better or more exciting time to be a small business owner". These include: Goliath backlash with customers getting tired of `predictability and conformity'; growth in small business alliances `uniting to make themselves more powerful, visible, and attractive to consumers eager to support their local economies'; escalation of consumer rage as expectations for quality and service are high; and high-touch technology offering resources to get closer to customers.

`Use service to compete,' is what the author learns from Zane, a bicycle seller. "Your customers expect the moon; you need to give them the universe." Keep raising the bar, reads another tip. Hire salespeople who can relate to your customers, advises Fenn. "Calculate the real cost of service," because once you do that you'd find it is not as much as you think!

More tips in the chapter called `seduce your customers' are about pampering the 20 per cent of your customers who account for approximately 80 per cent of your profits; watching customers use your product; exceeding expectations; and treating B2B customers like partners.

Strategy #2 is to convert employees into `true believers'. Fenn cautions that a bad hire can cost you up to 200 per cent of employee compensation. "A bad hire isn't someone with lousy skills — it's someone who just doesn't fit into your organisation." Invest in your employees' professional development by cultivating an environment of continuous learning, counsels Fenn. Also, "Recruit creatively. Interview for behaviour, not just skills. Hire outside your industry. Tailor incentives to individuals. And take a contrarian approach to managing."

Technology appears as the next strategy. Be an early adopter, insists Fenn. And upgrade wisely, without being seduced by `bells and whistles'. Online community can help drive demand for the product, points out the author with examples.

The next strategy is to stake a hometown claim. "Choose a killer location," such as "neighbourhoods with local character and stability", not necessarily "the most heavily trafficked". Fenn explains that it is not just your product or service that attracts customers; "everything from your décor to the music you play to your employees' uniforms (or lack thereof) has the potential to draw people in or drive them away." Other tips are: "Grow it slowly. Be a good citizen. Tap local intelligence. Support your community's youth." And more.

The fifth strategy is about innovating `the mundane' by thinking like an outsider, getting out of the commodity game, tweaking innovations, and so forth. "Look for the trouble spots in your product or service — that's where the opportunity for innovation lies," instructs Fenn. Since anything can be commoditised in two years, you must stay ahead of copycats "by constantly improving and/or changing your product or service to adapt to evolving market needs."

Strategy #6, `market your brand, inside and out'. The essence of branding is the emotional connection you make with your customers, writes Fenn. Don't forget to brand your values, because "more and more customers care about good citizenship." Brand your culture, the way Southwest Airlines had done, because "customers love the cheap fares, but they also genuinely enjoy doing business with a company with such a distinctive culture."

Build a village, reads the next strategy, and it is about network. Key suggestions include having someone in charge, articulating the purpose of network, choosing members carefully, and demanding loyalty. And lastly, `embrace reinvention'. For, it is dangerous to be complacent, basking in past successes.

Scores of tales of successful entrepreneurs fill the pages of the book. "What really makes an Alpha Dog isn't just its stock in trade; it's the company itself," says Fenn, deconstructing the DNA. "Companies make the leap from ordinary to extraordinary when their leaders step back from what they do and focus on how they're doing it." They had "a way of expertly executing the task at hand and of taking pride in even the most humble kind of work," like the good outfits!

Alpha Dog doesn't take anything for granted; "it's responsive, dynamic, resilient and sustainable." Most important, "it refuses to accept the conventional wisdom that size is limiting." For, "Even a very small dog, when it stands in the proper light, can cast an awesome shadow."

A book that can get a good bark out of you!

ManageMentor@TheHindu.co.in

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