The Game Changers

The worst of times are usually the best of times for real entrepreneurs. We are going through the worst recession since the 1930s. If ‘necessity is the mother of invention,’ there are unlimited opportunities for the entrepreneurs to invent new business models. This needs foresight. We cannot narrow our quest to a near-term profit or only focus on the next quarter’s numbers. While survival is important, we cannot just stick to our near-term obsessions and hope that things will be fine in the long run. Staying the course may make us survive a little bit longer, but we need to create a business model for the long term.

Entrepreneurs have invented business models in the past based on the demand of the time. The oldest and most basic business model is the shopkeeper model. This involves setting up a store in a location where potential customers are likely to be and displaying a product or service. Then came bait and hook business model in the early 20th century. Later in the decades new business models were invented by General Motors, Toys R Us, FedEx, and McDonald’s, Wal-Mart, Netflix, eBay, Starbucks and others to meet the need of the hour.

The present global economic crisis demands the need for innovating new business models. Chris Penttilla has suggested considering seven game changers by the entrepreneurs of today in the May 2009 issue of the Entrepreneur magazine. Those game changers are:

1. Chaos due to the globalization (IBM adopting the service sector globally)
2. Changing customer values (McDonald’s serving gourmet coffee cheaper than Starbucks)
3. Rush for money saving products (gas sipping automobiles)
4. Simplicity (one-stop clinic)
5. Realignment of the product lines (Kodak jumping into digital market)
6. Not defending the status quo (Microsoft losing ground to Google in search engines)
7. Serve the customers you hate (Netflix attracting delinquent customers)

I will leave you with thoughts from Kenny Rogers' song:

“You never count your money when you’re sittin at the table.
There’ll be time enough for countin when the dealins done.”