Roland Dürre
Wednesday February 13th, 2019

Meetings & Conferences!? (Entrepreneur’s diary #130)

I no longer attend as many meetings and conferences as I used to. Consequently, I also no longer suffer under pointless loss of time as I used to. The question is: What is worse? Conferences or meetings?

Innovate Session at the (Zurich?) PM-Camp

I do not know. Both are usually boring. But you absolutely have to be there.

At conferences, you meet speakers who are enthusiastic about something that is news to them, but it is often extremely old news to you.

Others demonstrate what great personalities they are and distribute their knowledge in huge quantities. Or else, they have boring stupid jokes and useless information.

The presentations are often stiff, the slides are just routinely read out. You can clearly see that the mostly male speaker did the same presentation often before. He just changed the place, date and event on the slides this morning.

In my opinion, traditional conferences are a leftover of feudalism. On a classical conference, two castes meet – the speakers and the listeners. The speakers are paid and enjoy other privileges, while the listeners must pay and shut up.

More often than not, you get a terrible noise background – always one-way. During the breaks, you actually interact, but then you will soon be sent back to the lecture halls by the “orderlies”.

I prefer anti-conferences, such as OpenSpace and Barcamp.

There are fewer conferences and workshops than meetings. You attend a workshop with something in mind, because you want an advantage or you want to meet someone. You can actually skip it. On the other hand, if there is one of the often terrible meetings, you have the obligation to attend. The only way to avoid them is if you are very high up in the hierarchy.

And whenever you are sitting in a meeting, the “important people“ will often be late or start the meeting by giving their attention to their smartphones. As soon as everybody has arrived, the meetings can start. They end because the scheduled time is over and one of the important people has his/her next meeting. You rarely get much more than poor compromises.

Here is what I recommend with respect to meetings.

Both big and small concerns have far too many meetings. A wise friend of mine is trying to do something about this. He gives his customers the following rule:


Whenever there is a meeting, all the attendees ask the question: Does this meeting really make sense? If more than one person says: no, then the meeting is immediately to be terminated and everybody goes back to work.


Even in big concerns, this concept is very successful. If we want this procedure to become a success, then we need a little civil courage. But in a halfway civilized world, it actually works.

If everybody thinks they should have a meeting, you need a format. Because without structure, you mostly only get small talk. And thus, you will only get a result with a lot of luck (and after a lot of time). The format depends on what the goal of the meeting is.

Is the meeting because you want to find solutions and reason (creative) or is it more for team-building (mental)? Do you want the meeting to give you courage? Or is there a hard decision that needs to be made and cannot be made merely rationally because of a multi-dimensional problem (please remember that, per definition, decisions will always be made under uncertainty)?

You might decide upon the ars construendi, a game, a debate, etc. You might want support through dialectic rules and suitable tools (visualisation, haspic experience, … ).

And if the meeting is important but nobody knows why, then you can ask the important question. What exactly is our problem? Incidentally, this question is not asked often enough.

And then you choose the simplest of all formats and make it a  lean coffee. I also recommend a common time-boxing for each topic and an accompanying review of all decisions. Time-boxing means that you want to decide in advance – before starting the debate about a topic – how many minutes (!) you are going to give the problem. And with “review of decisions”, I am referring to a constant evaluation whether or not the priority of topics you decided upon is still relevant or if there have been changes.

You should use the first three minutes of a meeting to come to a common decision about which of the established communication formats you want. And then you can start. And sixty minutes later, you are finished. If you need ninety minutes, it is high time to stop and answer the question: what went wrong?

I can guarantee that, if you apply these rules, your meetings will be shortened considerably and, in return, they will give you more results. And you will actually experience that they can be fun. And sooner or later, these meetings will actually give you the shared flow that you need so badly for a successful co-existence

So: have courage and just try it. And if you are a little helpless, then why don’t you take an easy, agile and unpretentious moderator. There are many of them around.

RMD

P.S.
For more articles in my entrepreneur’s diary, click here: Drehscheibe!

A short time ago, I found the following tweet:

Aebby (Dr. Eberhard Huber)

Zusammenfassung meiner Führungs- und Leitungs-Philosophie:

 

My leadership philosophy in a nutshell:

  • Have AND show empathy and respect!
  • Do not spread fear!

Both this statement and the tweet were from my friend Aebby (@Team_im_Projekt), also known as Dr. Eberhard Huber. I admire him very much.

? Consequently, I do not wish to weaken his message. And I would like to add three comments:

  • For me, appreciation is also part of respect. Consequently, it is all about empathy AND respect & appreciation.
  • It is difficult not to spread fear if you fear something yourself. And since I am often afraid, I often notice that I also spread fear. I find that a pity, but on the other hand, I forgive myself because it looks absolutely human to me.
  • My third comment is only that the described leadership philosophy should not be limited to leadership but also be a common life philosophy.

All this does not make it easier. Perhaps the only thing for us to do is become more mature and wiser. Which is also easier said than done.

RMD
(Translated by EG)

P.S.
For more articles in my entrepreneur’s diary, click here: Drehscheibe!

Roland Dürre
Wednesday January 9th, 2019

“Business Theatre“ (Entrepreneur’s Diary #128)

On this picture, the person in uniform does not look happy at all.

I spent 18 months serving the country (in the army) and in these 18 months, I learned to drink and chill. To be sure, I also learned how to survive in a sick system.

However, these 18 months also showed me how enterprises should not be yet how they mostly are (perhaps because enterprises often follow army patterns when it comes to their organisation).

They drafted me on April, 1st, 1970 and assigned me to the air force at Lagerlechfeld. After a stop at Landsberg, my army career as “Flyer Dürre” started in Ulm on April, 5th. I ended up in a battalion that had its small barracks area at the Lower Kuhberg not far from the Centre of Ulm. The barracks had been named after the war-hero Boelcke (see Militär in Ulm).  It was an old barracks venue, some people actually believed they could still see the (removed) swastika over the entrance.

The barracks I landed in after Landsberg belonged to the training regiment of the air force. The air force was one of the three weapons categories they had in the German Armed Forces: they also had the navy and the army.


 

The organization was quite simple:
The battalion (Bataillon) consisted of three companies and a few staff positions, for instance the medical group, the vehicle service group and the supply group. The battalion commander was only a major. That indicated that our battalion did not have much military significance.

Each company had three platoons. Each company had a company commander (usually a corporal) and the master sergeant, usually in the rank of sergeant major. He was the boss of the administration, including the typists’ office and he had the operative task of organizing order, which also consisted of drawing up the guard service list.

Each platoon had a platoon commander and three units. Usually, the platoon commanders were non-commissioned officers, once in a while an ensign was among them. Each unit had its unit commander who led ten learners for three months of basic training. The unit commanders were generally rank and file.

In summary, you can say that about a hundred recruits (about 3 x 3 x 11) were facing a small group of thirteen (9 + 3 + 1) coaches. Since, basically, recruits are difficult soldiers, the group had to stick together and was often a tight-knit community.

The business model was part of the compulsory service model and also very simple:

Whenever a new quarter year began (on the first of January, April, July and October), the German conscripts had to go under weapons in hordes – they were drafted. They were put into barracks distributed all over the country. Whenever a unit had problems with one of the recruits they had been assigned (regardless of the reason), then said recruit was sent to us in Ulm. That is how I, too, ended up in Ulm.

One of the problems was that the people who came a few days later were totally different from me. In July, most of the new recruits were successful high-school graduates who had been taken out of their units because of insubordinate behaviour or because they had other problems (such as drugs). At all other times, we always had many people with social disadvantages, often they had not finished any school education. Every three months, the mixture was totally new.

Our task at Ulm was to make proper soldiers of these problem cases. They were to be turned into air-force soldiers with simple tasks such as object protection (sentry) or in typing offices (today, you would probably call it back office).

During my first home visit in my parents’ sitting room.

Three of the recruits always had to be upgraded to become future commanders of each teaching regiment. I was selected because I was the only one in my regiment who had successfully graduated from high school (most of the others had not finished school at all). They needed someone who could actually teach (civics, military ranks and structures, learning to use a weapon). This is how, after no more than three months of basic training, I became unit commander with special tasks such as teaching the regimental recruits.

Our staff unit:
The staff units were responsible for the entire battalion.

  • Medical unit
    The medical unit consisted of two doctors and a few paramedics. Besides the general health care, they were responsible for giving out sick passes and, especially problematic, for giving someone the status of “unfit for service“. Many wanted this certificate, but the ratio allowed for each battalion was rather low. Besides, everyone who had been declared unfit by our doctors had to get a second opinion. And if one of the recruits actually managed to get both documents, he was the happiest person on earth or at least on the barracks.
  • Vehicle service group
    This unit consisted of the mechanics and the drivers who serviced our vehicles (regardless of being part of the air force, we had no airplanes). They also moved the vehicles. 
The fleet had a few lorries with which the recruits were driven to the manoeuver or to shooting practice, a few accompanying vehicles, a kitchen truck and a few limousines that were used by the driving service to take the officers where they needed to go. I think we also had a bus, but it mostly sat around. As far as I know, the entire drivers’ service of the German Armed Forces (including tanks) is now outsourced.
  • Supplies
    The supply department was responsible for everything the company needed: clothes, weapons, office hardware, toilet paper. After all, a hundred new soldiers had to get their uniforms every three months. Food, however, was only organized by the supply unit (planning, procurement). The cooking was done by civil servants, of which the German Armed Forces had plenty on top of their 500,000 soldiers.

And it all worked quite well. The teachers (Ausbilder) in the three companies mostly managed to keep all the recruits alive (regardless of recurring suicide attempts). They even made tame soldiers out of them in three months. As a general rule, we delivered the soldiers to their new companies, where they then patently served their time (usually fifteen or twelve months) as sentries or office service persons for German barracks.

We always were within the limit when it came to the number of recruits who were declared unfit. Once in a while, we even discovered a talent who later went to serve at the musical unit of the air force, and the same is true for some top players that we found for the company and battalion sports teams.

We also never starved. To be sure, the quality of the food that was served to the recruits was abominable, but we of the staff were luckier than that. That was definitely something the procurement units managed very well.

So what exactly was the task of the top management?
The company commanders had a fine life and were able to focus on the important things. They often changed (as I said, the battalion had a very good reputation). The only one who stayed long was the commander, the major. He waited for his retirement money.

We occasionally saw the decorated officers when big events were scheduled (solemn oaths, final manoeuvres, celebrations). Other than that, they were not much of a hindrance to us.
But the officers were also quite industrious and diligent. The company bosses and the battalion commander often had long meetings in the battalion mess. They worked late into the night. Once in a while, higher officers from the regiment and from higher up were also among the participants. Occasionally, even a general came, which always caused a disruption in the normal barracks procedures.

And our highest bosses were often on business trips. That was when they had to leave the barracks and the officer’s mess and travel to important Armed Forces or NATO meetings. In military life, international contacts are extremely important. And since they were leaders, they had to attend numerous courses, because, as we all know, leading is not at all easy. And when they wanted to relax, they sometimes flew. After all, the airplanes of the air force had to be moved around.

There are many questions our officers had to answer:

  • How can we make sure the world remains at peace?
    Again and again, they tried to find a good reason for the existence of the German Armed Forces (and, basically, to this day, they never found one).
  • What can we do to promote the reputation of the German Armed Forces?
    That was particularly difficult in our case. Among the teaching persons – especially if they were non-commissioned – we had quite a few tough fellows. Again and again, some of them made the local news because of misconduct. But mostly, they were only mentioned anonymously. However, since we were so important when it came to taming the recruits, we had nothing to fear. 
When the German Armed Forces had huge events, the community of Ulm also was very interested.
  • How can we create a feeling of corporate identity with other units?
    I remember a visit of the Bavarian Mountain Soldiers (Gebirgsjäger) from Mittenwald. It ended quite badly. What I mean is: “some of the equipment was lost, but luckily, with the exception of a few injuries, none of the soldiers became casualties.“
  • How can we become friendly with the other NATO states?
    To me, this seemed to be a particularly important task.
  • Once in a while, they had to approve our decisions.
    Mostly, they did that without reservations. However, it always took time, which caused emotional disputes among the parties concerned.
  • Special attention was given to the athletic activities in and beyond the air force.
    For instance, every company had a soccer team and a handball team. We specifically chose and kept recruits that were a precious gain to the teams. And whenever you have one of these athletic competitions, you have reason to celebrate.

I remember a soccer match against the US Army. At the time, no American was able to play soccer, so we won by 21:1. It was the highest win I ever actively witnessed in field soccer. In fact, it turned out that the biggest challenge was how to get them to score their one counter goal. Imagine all the things you do in the name of peace among nations and brothers in arms.


 

Why do I tell you these things? Because, with the German Armed Forces, I experienced a huge stage where big military theatre was playing. However, it was no more than what I would have expected from the German Armed Forces.

After my service time, when I continued studying and working at Siemens, I also experienced business theatre. It increased all the time and that really did surprise me.

These days, I am also perplexed when I see that many small enterprises are no longer there for the people (employees and customers). With all the business theatre, there is no time left for anything else.

RMD
(Translated by EG)

P.S.
Only two pictures of me were taken during the entire time I served (April, 1, 1970 until September, 30, 1971). Both of them were taken during my first visit home; the first in front of the parents’ house and the second at the dinner table.

P.S.1
For more articles in my entrepreneur’s diary, click here: Drehscheibe!

Joy and courage as a basis for business. It is important to enjoy life. Especially if you are a role model.

As far as I remember, the ancient Greeks had a very simple theory of virtues. Let me describe it as I remember it.

The social goals of the ancient Greeks were justice and equality. They differentiated between arithmetic and geometric justice. Arithmetic justice means totally linear justice. In a very stringent way, it means that everybody gets the same. As opposed to this, geometrical means that there is more justice if you use some criteria. Consequently, what you get is not “the same for everyone”, but instead “for everyone what is appropriate for him”. And this is true both for what you and what you have to

In the ancient Greek philosophy, geometrical justice was considered the better option.

For social systems, for example for the state, their philosophy was:

The powerful in the government will have to be characterized by the virtue of wisdom

The warriors are characterized by the virtue of courage.

The  middle classes are characterized by the virtues of sober-mindedness and frugality.

So only the slaves remain. They are characterized by the virtue of .


? This is how I remember it from my days at school.

If you transfer this simply model of virtues to enterprises, you will probably get:

In management and in the board of directors you have the “wise ones“.

The salespersons are the warriors who courageously fight on the market in order to make the products and services something everybody wants and who also see to it that money flows in.

What remains are theemployees – who are supposed to be 
and frugal. In this context, being frugal means you have to treat the resources with consideration and you want to be sustainable.

In modern enterprises, we do not want slaves (although some employees certainly feel enslaved and consequently consider their salaries as compensation for damage).

This is how I feel about it. Basically, it is a very simply concept.< Today, we have progressed. Many people, as well as most of the directors and “leaders“, believe entrepreneurial myths:

  • You have to act and make decisions!
  • You have to be agile!
  • You need to develop an actual strategy and then you must implement said strategy!
  • You cannot do without a hierarchy!
  • Rationality beats emotional concepts!
  • >You have to develop your business systematically!
  • Success is the result of hard work!
  • You need strategical departments!
  • You need people who have charisma in order to make the employees follow you!
  • If you have enough money and the right kinds of employees, you can successfully master all challenges!
  • You have to know EVEYTHING that happens in the enterprise and you need to be able to control everything!
  • In order to be fair and just, you need clear rules for drawing up collective contracts (employee agreements)!
  • The power can and must be guaranteed through a stringent organization (line, matrix)!
  • Improvement is possible with processes, methods and certificates!
  • Entrepreneurial culture and values can be changed and generated through “culture engineering’!
  • All problems can be solved with rationality!
  • Equality and justice are possible!

 

  • And many more.

 

  • Why don’t you try and apply these rules to the social system “family”? – You will immediately notice what is wrong with them.
  • As I see it, these are all just myths that can and need to be questioned. They might well sound nice, but they are wrong and counter-productive. One of the reasons is because they are based on the belief in a general determinedness of life. Consequently, I can counter every single one of the aforementioned arguments with a good reasoning – and thus state why all these myths are incorrect.
  • But let us remain positive: my concept of a good and multi-dimensional enterprise is totally different! For me, an enterprise, and in particular the leaders of an enterprise, are, above all, hosts. They invite people to promote something special together and create the necessary environment for starting an enterprise.
  • An entrepreneur does not really need special characteristics. As I see it, the only requirement is that he is good at communicating. To be sure, this is hard enough and not to be underestimated – many persons do not find it easy, especially when it comes to the listening part. If an entrepreneur can also inspire and give impulses, then this is really a great thing.   
    ? Perhaps a bit of the ancient Greek wisdom would also be helpful when it comes to leadership. That would be absolutely top!
  • And here is how leadership in “new enterprises“ can be practiced:
  • Values and culture beat framework agreements and rules.
  • The effect is more important than the plan and the goal.
  • Thinking and understanding will prepare the way towards doing.
  • Nobody has all the power (citation by: Dr. Andreas Zeuch).
  • Self-organization and responsibility are possible and, where necessary, promoted and supported.
  • Joy and enthusiasm are essentially important and will be encouraged.
  • Teams are supported in such a way that they can experience the “flow“.
  • There are people in the enterprise who can actually support or even coach a team when this is necessary.
  • Since I am not a dreamer, I know pretty well that this all sounds a little utopian. There actually is a restriction. Since we live in a capitalist world, it is absolutely necessary – in the interest of survival – that you have a clear mercantile and always current report system for all the individual teams and for the entire enterprise. After all, many people have to work in order to make sure they can live. Which means they – justly – want a good salary. And that is only possible if the enterprise where they work, too, earns good money and remains a healthy business.RMD(Translated by EG)

P.S.
For all the articles of my entrepreneurial diary, click here:  Drehscheibe!

Roland Dürre
Monday October 29th, 2018

Sugar Coating (Entrepreneur’s Diary #126)

Last week, I learned some new vocabulary – sugar coating.

Following the motto “having a soccer table in your office does not in itself constitute #newwork“.

For me, it is quite clear that, in our social life as well as in our work-life, transparency within the enterprise and the participation of the relevant stakeholders (employees) are very important.


”Sugar coating“ as part of ”culture engineering“?

In my book enterprises are social systems where people work together in different roles for an economic goal – i.e. the goal of offering products and services that they will benefit from to people. Just like the Bavarian Constitution says.

Basically, enterprises are not machines that can be mechanically controlled by “management” that tries to minimize the input and maximize the output. Instead, enterprises are composed of humans.

A Great Team – InterFace Connection GmbH 1986: Celebrating.

That is extremely important. Just like I also consider values such as appreciation, respect and general considerateness when dealing with each other absolutely relevant in an entrepreneurial culture.

#newwork needs just as much communication as it needs civil courage and constructive disobedience. The elite of an enterprise should not be system agents. Instead, they have to be coaches, inspire people and give impulses. And the vast majority of an enterprise also has to try (and be able) to live the values they formulated.

For me, these are the pre-requisites and the basis of #newwork.

Especially in my sector, I discover more and more enterprises that “sugar-coat themselves”. Regardless, they still move at the edges of the German work legislation. And they form their processes and the entire system with an absolute priority on profit. For them, “entrepreneurial health management” is basically just an investment that is supposed to minimize the number of people who call in sick. For them, modern work environments are just a means to save on the rent for office space. And their decor is a sugar coat with great design and life style, both of which are supposed to impress the employees.

If you want #newwork to have any effect, then you cannot make it part of a strategically planned, human resource controlled ”enterprise culture engineering“. Instead, it must be lived by the employees –with intrinsic motivation.

This is what I have been preaching for decades, both because it is my personal experience and because of what I see in many enterprises.

RMD
(Translated by EG)

P.S.
For more articles of my entrepreneurial diary, see: Drehscheibe!

Roland Dürre
Thursday May 31st, 2018

Modern Enterprises (Entrepreneur’s Diary #125)

 

This is my attempt at outlining a “modern enterprise”.

 

If you visit Antarctica, you will see the condition of our planet. We badly need change.

Because: The country needs new enterprises.

If we wish to improve our lives, perhaps even if we just want to survive, we will have to drastically change our individual behaviour and the fringe conditions of our society in politics, business, social and cultural areas.

? In this article, I do not wish to write about social and cultural changes. In politics, I find the current tendencies towards demolition of the rule of law rather critical and dangerous. As far as business is concerned, I think we have now reached a perverse state of affairs that is really threatening. This is where we must start the process of change.

We managed to counter the destruction of our own bodies due to hard labour with the use of machines. Since the industrial revolution, we managed to drastically decrease the number of working hours per day.

Now the trend turns. Our growth ideology promotes an exploitation of both ourselves and others for stupid goals. The resulting burden is on our personal and social life (and on our families). By now, the process has reached a grotesque and fear-inspiring level (all-day care for small children, all-day schools for children and adolescents, several parallel jobs for grown-ups, full-time work for men and women, often in combination with hours of commuting that make the work day even longer, normal work on four or five days far away from home).

One would assume that it is the task of the state to change this situation. However, just like the unions, the state will not be able to do anything about it. Change is a task for all people who are concerned with the economy and who are responsible for enterprises – i.e. for many of us.

We must counterbalance the blind dogma of “productivity” with a new efficiency that promotes less waste (#nowaste) and more humanity. We must meet the wishes expressed by especially our young generation that say our work environments need some modification.

People are not here to serve the economy, but the economy is here to serve the people.

In this sense, our country needs new enterprises. There are quite a few communities and people who are concerned with the concept of #NewWork (#newwork) and who also try it out.

As early as in 1984, Wolf (Geldmacher) and yours truly, as the founders of InterFace Connection GmbH, aimed at establishing a really new and different enterprise. Unfortunately, we (and later I alone) only managed to do this during the first few years. Then the enterprise “grew up” and there were problems. Perhaps the time was not ripe, and/or I made too many mistakes.

Today, I at least feel competent to describe what such an enterprise would need to look like. I also know huge and small enterprises that show that modern enterprises, as described below, actually work quite well. This is true both for service providers (health, hotel, IT, mobility, care for the elderly and handicapped,… ) and the producing sector (bicycle technology, clothes, food, shoes, software, sports articles,…).

I would like to remind the reader that the following text describes many patterns that would be “ideal“ if realized. You will not find them too often in their purest form. It is already quite some progress if an enterprise leans towards the proposed direction.

I would also ask the kind reader to keep in mind that the following impulses are not supposed to be a textbook (which, with this topic, would have hundreds of pages). Instead, it is a lose document that wants to inspire a little bit and make you a little thoughtful!


 

Characteristics

Here are the outstanding characteristics of a modern enterprise

  • Common-good economy;
  • Networking idea;
  • Core competence and core business;
  • Customer and product centred;
  • Structure;
  • Processes;
  • Teams;
  • Infra-structure;
  • Requirements;
  • Culture and values;
  • Dynamics.

These are the important issues I would wish to discuss today!


 

Common-Good Economy

As demanded by the Bavarian Constitution, the priority of a modern enterprise must be to contribute towards the ” Gemeinwohl“. In other words, the products and services provided by an enterprise must, first and foremost, serve the people.

You will find something absolutely worth reading with Christian Felber, who is perhaps the most important protagonist of the common-good economy in the German-speaking world.


 

Common Good beats “Shareholder-Value“.

The common good principle limits entrepreneurial diversity and creativity.

Not everything that can be done is desired.

That is the price we have to pay for the common-good economy.

If you follow this principle, it is, for instance, hard to imagine how an enterprise that develops and produces weapons or mines can be common-good oriented. The service provided by private enterprises who “lease armies” or produce such things as “fighting robots“ – which is quite common today – cannot be in accordance with the common-good economy.

Less harmful examples for a clash between the common-good economy and products are the production of tobacco and e-cigarettes, or a farming concept that ruins the basis of its own existence (the soil and the country) in a predictable and sustainable way. I could make a long list of examples for existing misuse.

However, common-good economy not only takes the customers into consideration. It also considers other stakeholders, such as the employees and providers. The exploitation of employees violates the principle just as much as does the extortion of providers.

Also, in a common-good economy, the balance of “extremities” must be given. It contains and enumerates all the damage an enterprise does to its environment during the production process. The waste of water caused by a cheap production or the pollution of living space through wastewater are good examples.

However, damages caused by the products you make are also part of the extremity balance:
Example: If pre-defined threshold values for cars have been confirmed during examination but if they are then ignored and significantly higher when the cars are actually driving (exhaust scandal), then this is not simply fraud, but a huge damage in terms of the extremity balance by those enterprises that produce and are responsible for the cars.

Social damage caused by the enterprises (along with positive effects, if there are any) are also part of the extremity balance.

Examples: Damage done by enterprises if they grant credit to people although they know full well that those people cannot serve them. Manipulating people towards buying nonsense products (so-called marketing), making grown-ups addicts of gambling and children addicts of sweets, and much more of the same kind that happens every day.

Modern enterprises can follow the common-good principle!!!


 

The Idea of Networking

The networking idea means that an enterprise is willing and capable of promoting a special “added value“ to a number of cooperating enterprises, rather than wanting to develop highly complex system all by itself.

Partnership on the market beats dominating the market.

Example: The goal of a modern enterprise should not be to completely develop and produce an electronic car. Instead, it should provide an important part.

In general, you will want to say.
P (partnership) beats S (superiority)!

This is how, probably, dynamic alliances of small enterprises can make “better products“ that might well be complex and satisfy the basic needs of humans. Yet they can at the same time be sustainable and in harmony with the common good. In other words, they need not be detrimental to other people or, as is common today, to all of us.

Without – as is the practice of the huge concerns – manipulating the customers in advance and telling them what they have to need and then selling them those things.


 


Core competence and core business

There is a clear competence based on which a clearly defined service is offered or an actual product is developed or produced. In this business model, we need modern virtues such as self-restriction and the focus on your own strengths.

Example: An enterprise focuses on the development of electric motors (or perhaps even just an important sub-competence like the necessary software) or (rather than and) the efficient production of the entire motors.

Concentration and focussing beat “do-it-all-yourself“.


 

Customer centred and product centred

The customer and the product must be the centre of all entrepreneurial considerations. Consequently, all employees must work together towards one goal.

If you have a service enterprise, the person who receives the service must be the focal point of all creativity.

Examples: In an enterprise that offers home-care, the people you are assisting must get the optimal support and care. In a hospital or hotel, everything must be about the guests getting well soon or feeling absolutely comfortable. An enterprise that, for example, helps a medium-sized enterprise to cope with all the problems that can arise if you use IT, the service must give the customer time for his core business (the round-the-clock-worry-free solution).

Similarly, an enterprise that makes a product must make sure that all employees work towards making the product even more perfect on a permanent basis (functionality) and nicer (design) and easier on the eye (emotion), simpler, more efficient, less costly, etc.

Examples: You want to develop the electric motor for the low-volt sector, the best gear hub for the bicycle, the best e-velo for travelling, the best pair of shoes for making it easier to stand and walk in. Or to produce new e-cars by combining the simplest and best components available on the market.

If ALL employees in an enterprise are enthusiastic about a core competence and willing to work towards it – then true innovation will happen. The positive consequences are that the employees will identify with the enterprise in a healthy way and that being an active part of the enterprise (often simply called work) will give them courage and joy. That is what a modern enterprise needs in order to survive.

And this is how the customers can get so fascinated by a product that they recommend it in such a way that makes marketing (which basically should be banned) and sales promotion (the very word!) obsolete.

A shared enthusiasm for what you offer will move mountains.


 

Structure

I use the word “structure” as in “organizational structure”. I no longer use the word “organization“, because a modern enterprise organizes itself intuitively. They no longer need disciplinary bosses and an organigram that describes the organization.

A modern enterprise has no hierarchy. There are no panels such as directorate or work council. The legally binding positions of the enterprise (director or chairperson) are more representatives than decision makers.

All teams have a maximum size and are self-organized. They are well connected, interact directly and learn from each other. They are also responsible for their communication with stakeholders (customers, suppliers, …).

All decisions are team decisions. The teams are responsible for guaranteeing quality and time of delivery, as well as efficiency and further development.

Depending on the size of the enterprise, there might be a (small) back office. Possibly, some value adding teams are necessary in a direct or indirect way. Persons who mostly achieve the added value indirectly, however, will not give pre-defined requirements. Instead, they will give impulses and inspiration, or, in times of crises or problems, they help with actual moderation or support.

There are no main departments such as strategy, marketing, sales, human resources, product planning. The same is true for entrepreneurial processes and pre-defined methods. Neither are there any central services that get out of control and suddenly set their own standards. Simply because everyone uses their brains and actively participates. And because the services and products have a quality that sells by itself and because the promotion by those who bought it and tell the tale creates more demand than can be met.

Local & flexible beats central & inflexible, iteration beats planning!


 

Processes

I use the word “process” as in “process organization”. As before, I no longer use the term “organization“ because modern enterprises control themselves intuitively.

In a modern enterprise, you have no processes. Something that worked in practice and well-trained behaviour will always dynamically be adapted to change. Rules and regulations are not necessary, because the idea underlying every employee’s activities is their knowledge, their experience and their mental concepts. They all want to achieve the best goal – the best service for the customer or the best product. Social interaction is determined by values, rather than rules.

Common sense and intuition will beat processes and rules!


 

Teams

They realize the achievement of an enterprise, which means they render the service or make the products the enterprise thrives on. All employees in the teams must know and be competent in the core competences of the enterprise.

Example: There was a time when google only employed people who could actually program. That included administrative and managerial jobs.

Besides the explicit added value, all employees and team members also take responsibility for others

and for all the factors that make success possible.

Example: In a software team, everybody can program. Each team member takes responsibility for important fringe issues such as quality control, configuration, delivery on time, customer interaction,… on top of his original duties. This is how all competences and talents can be used for filling different roles that will contribute towards the success of the team either after mutual agreement or without even having had to talk about it.

Depending on the size of the enterprise and the challenges, it is possible that, apart from the teams that directly cause the added value, others will be necessary for the indirect achievement of added value.

Example: There might be service and moderation teams. The moderation teams are made up of particularly experienced employees with moderation competence. They can help if a team has problems or if a team becomes too big and cannot really cope with how to divide itself. However, their support should always be restricted to moderation and perhaps help towards finding solutions.

The teams are the central elements of the enterprise!


 

Infra structure

The entire enterprise is part of one intranet (software system). Said system provides a wiki or social media system. However, I would not call it “knowledge management“ (the term has been used up). Instead, I would call it a common basis of communication.

Example: A system such as Google+ is very mature and offers all you need. If you have a bigger enterprise, you might consider customizing or even develop your own system. If you have a small firm, I would recommend you take one of the many systems available.

All members and teams contribute towards the content.

Example: A team found potential for improvement at the tag and tells other teams about it.

Ideally, the system should be available to all stakeholders (customers, providers, sympathizers and the competition), usually with reading and comment enabled. Because transparent systems are an advantage for all parties concerned.

In addition to the system, you organize meetings (face2face) at regular intervals and with a reasonable format, for instance barcamps. Basically, the internet only makes sense if you also see each other once in a while.

For the infra structure, the following is true: It always has to be a means to an end, rather than its own end. It must be capable of adapting to changed needs quickly and be absolutely simple. So here is what we need:

No more than the amount we really need and as much as necessary!


 

Requirements

From the business point of view:
The only element we know from classic enterprises and that has to remain intact in a “modern enterprise“ is the strict adherence to business control principles. All teams must have positive balance sheets. If a team has problems, it has to either solve them or ask other teams for help. Budget deficits are only tolerated for short time intervals. If they do not disappear quickly, the team will be suspended.

Any surplus will be used for financing the (low) infra-structure costs. A considerable part of the profit

remains with the team, the team members decide the quota and extent to which profit is distributed among the team members. Dependent on the individual situation, a suitable part remains with the enterprise or/and with the shareholders.

Example: If a team has a problem, for instance with coming up with a decision or with dividing itself into smaller parts, they will contact the moderator. That is also true if a team notices that it has technological problems or quality deficits. The team will choose its own moderator.


 

Structure:

The size of a team will be mutually agreed upon. Depending on the task or challenge, I would say a team should be between seven and fifteen employees.

As the situation requires, a moderator should be able to work for between ten and twelve teams. If you have a small enterprise, for instance only one team, then members of the teams will also play the moderator role.

Example: The enterprise Buurtzorg (The Netherlands, Home Care) has 1,000 teams with ten employees in each team (i.e. 10,000 employees), for which fifty moderators are totally adequate. They have many teams that never need a moderator and some teams that often need a moderator.

If you have founders (which, naturally, is only relevant for a young enterprise, since after a few decades the problem solves itself biologically), then they can, of course, be moderators, impulse givers and inspiratory, as well as achievers.

Example: At InterFace Connection GmbH (which was the predecessor of InterFace AG), I did consultant work for other companies and at the same time contributed towards building up CLOU/HIT (”product owner“).


 

Knowledge:

All experience is shared. This should at least happen online and, if we are talking important experience, also in person (peer2peer or in a barcamp).

Example: Best Practice concepts discovered by one team will be published for all teams on a shared website.

Merkantile clarity, the willingness to support each other and the absolute readiness to share all knowledge are indespensable requirements!


 

Values and Culture

Similar to the entrepreneurial culture, values are also best described by stories. It makes sense to remember the culture onion  (Kulturzwiebel).

Example: There are enterprises where the employees share the belief that all they do and all their decisions should be agile, slim, transparent, pragmatic, professional, uncomplicated and similar things. They also believe that listening is just as important as – or maybe even more important than – talking. The values they live are eye-level and respect. Self-organization, self-responsibility, participation and error tolerance are normal behaviour. They all share the basic assumption that all form of indoctrination can be avoided if you use your common sense and emotional intelligence. And, last not least, they all believe that the “heroes” that every social system will inevitably create will turn exceptional employees into models.

In summary, one could say that a modern enterprise is a social system with a respectable goal that masters the art of not producing system agents. Because diversity beats simple-mindedness. Together, the employees know and understand more than the “boss“ alone can ever know or understand.

Thus, “corporate identity” will not be decreed from above, but instead develops mutually, just like the future is also shaped by mutual agreement. This is possible in a modern enterprise. Bureaucratic detours like holacracy, („Holokratie“ – in my opinion, the concept is crazy) must be avoided. Because the cooperation in teams and in an enterprise must not be dominated by bureaucrazy.

In a modern enterprise, it must be clear that there is no control through set goals and that nobody tries to motivate anybody by explicitly holding out a prospect of rewards by granting material favours (extrinsic motivation). Both measures will not work and in the end they will be more detrimental than beneficial.

The employees are motivated because they experience an environment where they can work with courage, joy and confidence in a self-organized and self-responsible way. This is how an intrinsic motivation will grow. And because they know that they can and will be successful together and that, at the end of the day, the success will be shared fairly and in a self-organized way wherever possible.

In former times, I often invoked the term “fear-free zone” as something an enterprise must realize. Today, I have progressed and now I demand a “zone that leaves room for unfolding“.

If you want to have it, you will, first and foremost, need absolute mutual appreciation of everybody’s value. It must be lived and shown by the models. Most likely, something else must be added to this element, for instance maybe that the expectations are not ”too trivial“.

Culture and values are the “operating system” of a modern enterprise.


 

Dynamics

Since the world changes at an enormous pace and is also perceived as more complex than in former times, there must be a high willingness to change in a modern enterprise. The wisdom of an enterprise should ideally consist of the wisdom of the masses. The right questions are asked before you start working on the solutions.

Nothing is as constant as change!


 

Utopia?

Some readers will probably not understand this article and judge it as utopian. Freedom makes them insecure because they know another world and feel comfortable with this other world. They prefer clear statements by third parties, instead of accepting responsibility.

That has also been my experience with some of the people who started out with me. They considered my ideas utopian. Regardless, my experience with self-organisation and self-responsibility were always excellent.

There is another argument that, sadly, I have to accept:
Huge success, exceptional growth and the thus achieved enormous dimensions will corrupt an enterprise and its culture.
It is perhaps some kind of entrepreneurial natural law.

Well, all I can do is provide a nice counter-argument and a solution:

I notice all the time that huge enterprises that had medium-sized beginnings work better than the concerns I know.

And perhaps there is a counter-measure: You could decree that companies that grow too fast have to divide into smaller ones according to their core competences and determined by the teams that were built inside the company?

Today, I know a number of firms that show that it really works and that you can be very, if not fear-inspiringly, successful with utopian ideas. You can really earn a lot of money with this kind of company for your employees and for your enterprise.

Thank you very much for living and having discussions with me.

RMD

P.S.
I often and gladly give presentations on this topic. I always defend my theories. Strangely enough, though, I seldom have to do a lot of defence work to do. Instead, I usually get a lot of consent and support.
? To my surprise (or not), this support often comes from very conservative leadership personalities.

P.S.1
For more articles of my entrepreneurial diary, see: Drehscheibe!

RMD
(Translated by EG)

Today, you will read a wonderful metaphor for entrepreneurs on:

“How Creative Innovation Can Work“

I heard this story many years ago from Alain Neumann. I will retell it and modify it a little in the process.

You see a happy entrepreneur, because we did it.

Switzerland is famous for its chocolate. When I was a child, I was always craving very ordinary chocolate. My favourite was “full-milk”. But even when I was young, “just chocolate” was no longer a hit. Because the market of the economic miracle country wanted more.

In order to expand, the chocolate industry enterprises had to offer more. For instance chocolate with hazelnuts.

The story I am going to tell plays in Switzerland. A medium-sized enterprise produced chocolate with hazelnuts as their specialty. It was not easy, because the cracking of the nuts was sometimes a problem. More often than not, the nuts would break into many small pieces and, even worse, there would occasionally be splinters of nutshells in the bar of chocolate.

This was not only detrimental for the degree to which eaters enjoyed it, but also less than fortunate for the enterprise, because the nutshell can be rather hard and thus might well damage the occasional tooth when you bite into it. And selling the chocolate with whole hazelnuts was not at all an option, because when you cracked the nuts, they would regularly break into several parts, which made the pickings of whole nuts rather small.

Consequently, they gave a team of engineers the task of having to revolutionize the process of nut cracking. The nuts were to remain totally undamaged. Besides, it had to be avoided at all costs that nutshell splinters ever got into the chocolate. And, of course, the entire process had to be automated and done by unmanned machines.

The engineers worked day and night, but found no solution. It seemed to be a hopeless assignment and the engineers became more and more frustrated with each passing day.

The enterprise also had a porter. He came from what we would today call the “uneducated”, but everybody rather liked him. He felt pity for the engineers who left the building late at night and became more and more frustrated every day.

The porter really felt bad for these engineers. Consequently, he promised to think about the problem and later offer a solution. Of course, the reaction of the engineers was a pitying smile, rather than hope.

One morning, after he had worked the night shift, the porter told the engineers that he had now found the solution. In best Swizz-German (which I cannot pronounce), he said:

“You want to find your way into the nut like a worm and then open it from the inside“.

Initially, when the engineers heard this, they just laughed. But then one of them had the right idea. And then the engineers drilled a small hole into the nut-shell in order to implode the nut from the inside with pressure.

That was the breakthrough!

From then on, the number of split nuts dwindled to practically zero. Since that day, you can buy nut chocolate with whole nuts and with a guarantee that it contains no splinters!

It is quite possible that hazelnuts are still cracked in exactly the same way today. At least, this is how Alain Neumann told it ten years ago. That was the time when Alain was allocated a place of honour in my private collection of people I know in the “Hall of Fame” for great orators. Decades ago, he already made people understand in his unique way what it means to found an enterprise and mange it well. By just giving them enthusiasm and then let them do the job.

Whenever I find creative innovations in my own environment, I add a new story. On the other hand, as of now, I have never found a successful innovation that was created in the laboratory.

RMD
(Translated by EG)

P.S.
For more articles in my entrepreneur’s diary, click here: Drehscheibe!

Roland Dürre
Wednesday September 13th, 2017

Entrepreneur’s Diary #123 – Appraisal Interviews

Evening Event BICCnight “it at media“ in the foyer of the Funkhaus Bayern. München, 22/07/2011 picture by Stephan Goerlich

For today’s entrepreneur’s diary, I chose a very banal topic: The Appraisal Interview.

Together with Wolf Geldmacher, I founded the InterFace Connection GmbH in 1984. Immediately, we had ten successful years as the producers of the software HIT-CLOU and quickly became the leaders on the market for text systems on UNIX in Europe. Because we were a great team. It was a true delight. In retrospective, those were the ten best years of my professional career.

Before we founded InterFace Connection, I had worked for Siemens and Softlab. I wanted to adopt all the things I found good in those enterprises in my own firm. It was quite a number of things. However, there were many more things that did not find my approval and I consequently wanted to handle them differently – those were the more important things.

Among other things, I am talking the chance to decide what tasks were delegated to whom and also of deciding what, when, how and where the work had to be done. At Siemens, the delegation of tasks was “from top to bottom”. That was not what I wanted. And during the first ten years, thanks to a high degree of self-organization and a huge amount of self-responsibility both of the team and the people at InterFace Connection, this worked (very) well.

Both Siemens and Softlab had things I liked. For instance the yearly appraisal interview. It gave you the chance to speak openly with the boss of a hierarchical system at least once every year. I found this a good idea and did the same at the Connection. Regardless of the fact that we always were an enterprise of “open doors” – which means that all employees could come and pour out their sorrows over me and Wolf at any time. Today, I still recommend the “open doors”. However, I no longer recommend the appraisal interviews. The reason is that you do not need them.

At InterFace Connection, this is what happened: after three months (shortly before your probation time ended), there was the first appraisal interview and then, always before a years was over, there was the next. Thus, depending on the time a new person was employed, the interviews took place all the year round. There was also a structure for the interviews. Looking back upon the last year was a considerable part of the interview, then came the exchange of feedback and eventually the negotiations of a new income. I always asked my employees to be well prepared and saw to it that I, too, was always well prepared.

Basically, it went quite well. Except that a few wise-cracks thought it was perhaps unfair. After all, the entrepreneurial context of one month might be totally different from another month. And this could mean that a rise in income based on the current situation might not be fair.

We reacted to this and re-scheduled all (!) the interviews to take place at the end of the year. This had considerable disadvantages and made the topic a sad one. The stress level in November and December climbed another notch. That caused lack of motivation and exhaustion. Nor did the direct comparison make things any easier. At the time, I did not yet understand that there is no such thing as justice (or: there are many definitions of justice).

Perhaps one could construct a “justice based on need”. But justice based on achievement is definitely nonsense.

Today, I believe you cannot set dates for interviews of any sort by following a rule. Let alone if the date is in the far-away future. No, you always have to have an interview close to the occasion, when you have a good reason or at least a current situation that allows or demands it.

Especially communication between humans always has to take place when the necessity arises. For instance, dissatisfaction must never be conserved until the yearly appointment in order to then open the frustration nozzle.

More money agreed upon in ritualized interviews is only the second-best thing. It is better to talk about distributing the success exactly at the time the success happened. And it would be best to let those decide who actually were the ones who made the success possible. At team level.

Wages are a difficult topic. I already wrote about it quite a few times and probably will soon again write about it. Because it is not really goal-oriented that, in Germany, you get more money every year until you are quite old – up to retirement – and, on the other hand, decreasing wages are not really possible during the active time of a work contract. Simply because the achievement curve, even of a programmer, cannot point upward all your life long. But I will write about this at another time.

RMD
(Translated by EG)

P.S.
For more articles of my entrepreneur’s diary, click here: Drehscheibe!


I learned much from Rupert – also how to build syllogisms and vexilla (I took the picture before 2010).

My first introduction to building vexilla was through my teacher and friend Rupert Lay. He closely accompanied my learning and my development for far more than ten years.

Through him, I made the acquaintance of quite a number of the important managers and entrepreneurs who were active in the German economy in the 1970s and 1980s. I also learned to appreciate them and they taught me a lot.

It was also where I learned how many fundamentally important things were achieved in his seminars. In these seminars, you practice the ancient Greek dialectics based on the construction and analysis of syllogisms (Syllogismen) and on the dialectic technology of building vexilla (Fahnenbildung).

In the Projektmagazin – which, incidentally, I find quite a stroke of genius – there is also an article (one of them by Elisabeth Wagner) that is very much worth reading. It describes how, through building vexilla, you can develop ideas and solve problems in a very baffling way and very efficiently.

Basically, building vexilla is just a dialectic philosophical method and has been used in this discipline for thousands of years. As we know, philosophy tries to analyse, understand and give meaning to the world  and the human existence . In a nutshell, I would say it tries to answer the questions: why, for what reason, to what end, how? And that will also help you when you are looking for new ideas and solutions.

The combination of “agile” and “classic dialectics” is a stroke of genius – in almost all cases, it will render excellent results. This is how you can actually achieve “empowering of the people“.

Again and again, that was my experience when moderating start-ups. Especially for an agile team where the individuals work at eye-level, building vexilla is a fantastic tool for gaining new insights in a creative way. Once on a while, you will even mange to get rid of wrong (and often deeply rooted) prejudices.

Here is how you want to proceed in eight steps if you build a vexillum. I like applying them.

  • Formulate the desired theory and define the central terms of the theory.
  • Collect requirements that need to be met at first sight if you want agreement with a certain and exactly defined event or project. You want a list that is as finite as possible.
  • Definition of the terms you used and common agreement.
  • Evaluation of the requirements following the criteria: useful, necessary, sufficient.
  • In case of different opinions with respect to the quality or applicability of requirements, you need to look for alternatives until all the requirements get a consensus. It is permitted to delete requirements that turn out to be unnecessary.
  • Test if all requirements belong to one language game and determine the end function. 
Example for an enterprise: 
regulative – keep the common good out of danger; 
ethically – realize biophily, 
economical – improve the results
  • Test if all the requirements are met or if they can be met with acceptable cost. 
You want to keep in mind that only the actual realization of a project will show if your assumptions have been correct. Consequently, the vexillum can also contain requirements that make a later correction or omission of an earlier decision necessary.
  • In the ideal case, you will find a sufficient requirement as the result of building a vexillum. You will not always manage that. But the sum of necessary requirements that, taken together, will qualify as “sufficient” is also a satisfactory result.

If you wish to try the technology of building vexilla and need assistance, I will gladly help you.

RMD
(Translated by EG)

P.S.
For more articles of my entrepreneur’s diary, click here: Drehscheibe!

AGILE and yet LEAN on the MS EUROPA – a while back.

It is not quite so easy, because there are no patent recipes for founding a company. But there are criteria that can provide orientation. Let me write a few of my ideas, especially on business plans as they are expected by banks and investors, as well as by the competition. Here is what you should keep in mind when writing one.

The text is based on my own experiences, but also on what I learned as a juror at business plan competitions and from the more or less intense dialogue with all kinds of start-ups.

I recommend you proceed in three steps. Many founders use the wrong sequence by, for instance, first wondering what the best legal status of an enterprise might be. However, this will initially play only a minor role. It is more important to get all the necessary invoices written in time.


Necessary requirements for establishing a company are:

  • The team – 
I believe you should be at least two persons and three is probably the best number.
  • The idea – 
well, if you do not have an idea (or even better: several ideas), you can forget about it 
and
  • A great story – 
that supports the entire concept and is allowed to live.
    Part of the story is a (working) title and an (initial) logo of the enterprise that is to be established or the project you want to start. The team and the idea are also parts of the story.

The description of your special expertise and the competence of the partners is also part of the story. The founders need to relate where they are really unbeatable and whom they know around their field of expertise. You definitely should be able to name a few good friends (or acquaintances) that you can name as customers, partners or supporters of some sort or other. If the founders already have a small network that helps them towards reaching their goals, then that is even better.

Thus, the story should shed light on the “yesterday, today, tomorrow” and on the “what, how, why, to what end” in a narrative form.

Basically, you have to use the story to make clear why the entire affair is going to be a success. Only after you can present a nice story does it make sense to start writing the Business Plan. In fact, the business plan will draw from the story. There is no other way to do it successfully.

Here is a list of the usual criteria for a good business plan., along with advice on when which steps should be taken. And why the sequence actually matters.

According to what I recommend, a business plan should be developed in (three) steps. The following points can help founders to better structure their activities. They also help the juror and/or the investor when it comes to understanding the content of the plan and its quality. Which means to better judge the chances of success.

However, these criteria will also help the founder to examine his idea and his plan, looking for weak points quasi as a “self-control mechanism”. It also helps him to realize what special strength his idea or his plan has. More often than not, the founder will only intuitively be aware of them. However, he will have to be able to formulate them!

The procedure I describe is rather advanced and will help you to gain clarity about the business model you describe – and thus to increase the probability that your project will be a success.

However, this does not give a founder free reign such that he can ignore the implementation of his business model in a very “agile”, “slim” and “pragmatic” way and to seek rapid success.

In other words:

Regardless of very intense thinking, the process must be lean for every founding project and trying things out must have a high priority.
So here comes the “business plan” with its three stages:

In its first step, the business plan should contain:

A precise conclusion that clearly states why the business idea is attractive and that outlines its relevant aspects.

A comprehensible description of the expected gain for the customer and how the product/service differs from what the competition offers.

The evaluation of the market and of the competition has to be absolutely consistent in the business plan.

The measures absolutely necessary for successful marketing and sales have to be described in detail. Principles such as

aida = attention, interest, desire, action (marketing) 
or
4 ps = product, price, place, promotion (product offer/service offer)
are helpful.

The expected business structure and the future organisation (structure and processes) must be described in fair detail and must be realistic.
There will always be chances and risks. There must be a thorough judgement and evaluation of both.

Even the first step of such a business plan should look presentable – but it should also transport the competence and enthusiasm of the founders. This document must not be a theoretical work – it should not talk about certainties and not use too many numbers. It should also create room for testing ideas.

If all this has been done successfully, a lot has been achieved.

No earlier than in the second step, you will need the following:

The economical planning and the description of the “operative agenda”. Both will not make sense before the first step has been successfully managed. The same is true for the actual organization, e.g. the structure of the planned enterprise and your idea about how processes in the enterprise should run.

No earlier than in the third step, the following things will be relevant:

After the results of stages one and two are clear, the founders should start thinking about the legal status and the statutes of the enterprise to be founded. Mostly, this is quite trivial and not really all that important from the perspective of a true entrepreneur. However, what becomes rather important now are the actual financial plans, both with respect the question of initial capital and for the actual financing. Basically, they are more like a simulation that answers the question under what conditions/assumptions a successful start will be possible, rather than a “business plan paper”.

Incidentally, the famous “pitch“ will then be nothing other than an extract of “story” and “business plan”. And it should be as short as possible.


I would advise all the founders who already wrote a business plan to look and see if it meets all the above criteria. As I see it, there are many cases where there is huge potential for improvement. And I would recommend that would-be founders either do without a business plan or else use their “common sense”. Or else, if circumstances make it necessary, they might wish to stick to my steps and criteria when writing their document.

RMD
(Translated by EG)