Developing a new enterprise can be really exciting and this can cause you to forget some of the important elements of developing your idea. The following step-by-step approach should help keep you and your team on track.
Even better, as you go through the stages you will be developing and producing information ready to go into a business plan. So let’s check out some basics. This step-by-step approach works well when you want:
- to develop a new product or?service.
- to develop an existing service or product to increase its potential as an income earner.
- to create a new, separate business to your existing core business – probably as a social enterprise.
Once you have your idea, going through the following eight steps will enable you to consider the reality of taking your idea forward. This activity is best done with your team to ensure you have input from various people with their own skills, knowledge and experience.
My really simple eight step approach to developing a new enterprise
Step One – Reasoning
Clarify your reasoning for embarking on your enterprise journey. This is your ‘Why’.? Why are you doing it? Why is this important?
I understand that you may be focused on providing a solution to a social need or providing an opportunity to a disadvantaged group. However, if you are not clear about the reason why you are doing this as an enterprise rather than as a grant funded or charitable activity then it is easy to become consumed by the activity and lose focus on the income generation.
Starting up a new enterprise will take time and energy and will require the team to drive it forward. The more everyone is sure of and signed up to the reasoning behind the new enterprise, the more likely they are to be willing?to put in the extra effort required.
Step Two – Idea
Do you have an idea? If so, what is it? If you don?t have an idea how do you develop an idea? How do you get your team to develop an idea or business proposal?
Often business owners come up with an idea first and then decide to start a business. When an already established organisation decides to develop an enterprising idea it can often be that the idea itself is not that strong or there is no clear idea, only a desire to start an enterprise. This can come about when an organisation such as a charity realise that they need to develop an enterprise in order to develop a new or additional income stream, possibly to substitute grants or donations which may be reducing or be unstable. Moving from grant funding to more commercial income can be both exciting and daunting and your idea needs to be considered carefully in order to enable a successful project.
To develop an idea work with your team to consider what skills / connections / needs you have and how these can be turned into an idea. For more about idea generation read my article on developing an enterprising idea.
Step Three -Resources and structure
What resources do you have (finance, time, staff etc.)? This is about identifying what you have and what you need. This will feed into your overall plan.
One of your biggest resources is likely to be your team, the staff and volunteers, and possibly service users who will enable this project to go ahead. However, you need to remember that for many the idea of developing an enterprise is a big change from their traditional way of delivering services via grants, donations or funding. For many organisations there will be a shift in the culture and this can be unsettling. Be cautious about making big staffing decisions too soon into the project or bringing in new people who do not connect or engage with the existing team. Try and work with your team to bring them along with you on the journey rather than forcing changes early on.
Be realistic about your resources and don’t overstretch them or you risk not being able to deliver your current core service whilst working on your new enterprise. Your strength will be in keeping your core business, as well as your new business, going so that they can feed into each other.
Step Four – Marketplace
What is your planned marketplace? Who will you sell to? What do you know of them and your competition?
Although your driver may be to meet a social need, support a disadvantaged group or provide employment opportunities for those finding it hard to gain employment, you must always keep an eye on the market place and how you will generate income from your enterprise.
Do you understand who sits in the marketplace currently, your competition, how you will set yourself apart from them and provide a different offering? Have you checked that there is a need for your idea: will people really buy this product or service, how will they react to your offering and buying from you? Be honest with yourselves about the reality of running this idea as a business so that you do not go into it with blinkers on.
Step Five – Trial run
Can you run a pilot – a small scale version of your idea – to try it out?
This can be extremely useful and often can be run in-house or under your existing structure in order to test the market and idea before committing resources to it. For many ideas it is possible to run them as a one-off, maybe a pop-up shop or a one-off event to see if the staff are ready and the idea developed enough before you grow the idea and build on it as a separate business.
It may be possible to access some support and/or funding to pilot your idea. This in turn will provide evidence to your funders, stakeholders and board members if you wish to develop the idea further.
Step Six – Strategy
Developing your plan of action. For some this is a blueprint which shows the ‘Why, What, How, When and Where’ elements of the business.
Often developed alongside a trial run ahead of launching the actual enterprise is your Business Plan and Action Plan for Launch and Development. It is often needed to secure funding, achieve buy-in from board members and stakeholders,?and generally to keep your ideas on track and structured. Developing your plan of action is likely to require not only your senior team on board but also your board of trustees or directors. Furthermore, your team need to feel included in the process and willing to support the implementation of a strategy.
You may need some help with this element if your team are not experienced to ensure it is well considered and realistic.
Step Seven – Activity
Actually starting the enterprise – what should you be considering and doing to make this happen?
This is the exciting element, the actually doing it: launching the products and services and starting to grow the business idea. But be careful you don’t get distracted from the overall plan and the reason(s) you became?involved in the enterprise to begin with.
Step Eight – Review and reflection
Having a plan of how and when you will review and reflect.
Having a plan of how and when you will review and reflect will enable you to demonstrate to funders, stakeholders and board members that you have been developing the idea and continuously improving it. This is especially important if you have received funding or will need to report back to the board in order to have their continued support.
Consider what you will be measuring: how will you know if this has been a success? For many enterprises with a social element they are keen to measure social impact as well as income generation. However and whatever you are planning to measure?consider early on how that will be carried out so suitable records can be kept.
Need help in developing your enterprise or encouraging your teams to be more?enterprising? Book Rebecca to speak at your event or run a training session for your?organisation.