on the im­por­tance of choos­ing the right op­por­tu­ni­ties for lead­ers. [ ]

In an ear­lier in­ter­view with The Smart Man­ager, Rita McGrath, au­thor of The End of Com­pet­i­tive Ad­van­tage, said, “In or­ga­ni­za­tions, we al­ways think the sins of com­mis­sion are the ones that might be pun­ished. In smart com­pa­nies in the fu­ture, we are also go­ing to think about sins of omis­sion—not tak­ing the ap­pro­pri­ate chances or pur­su­ing the ap­pro­pri­ate op­por­tu­ni­ties for the fu­ture.” Con­sciously look­ing for op­por­tu­ni­ties and lever­ag­ing the best among them de­fines the path to sur­vival in the long term.

Afew years ago, Pro­fes­sor J Bruce Har­reld of Har­vard Busi­ness School stud­ied busi­nesses around the world of all sizes, in all sec­tors. Re­mark­ably enough, he found that ‘only 1.7 per­cent’ of com­pa­nies last more than 40 years. That is only half the typ­i­cal hu­man lifes­pan. How long should com­pa­nies be able to live? The­o­ret­i­cally, for­ever. Why do they die so young?

all op­por­tu­ni­ties have a life­cy­cle

Just as prod­ucts have a life­cy­cle, so do op­por­tu­ni­ties. While some can re­main rel­e­vant for decades, oth­ers fiz­zle out in only months or years. Th­ese days, even iconic con­sumer prod­ucts such as Coca-Cola are grap­pling with ir­rel­e­vance.

All com­pa­nies con­stantly in­vest in new op­por­tu­ni­ties, both to re­place those fac­ing ir­rel­e­vance, as well as to cre­ate new growth. The Har­vard study found that while all

cor­po­rate lead­ers are con­stantly on the look­out for great new op­por­tu­ni­ties, most fail to cap­ture them.

Why? Be­cause they go about this task in­cor­rectly. The busi­ness grave­yard is lit­tered with the mem­o­ries of once great com­pa­nies that failed to over­come the forces of ir­rel­e­vance. Re­mem­ber Po­laroid, or Ko­dak? Re­mem­ber Nokia, or Black­berry? I could go on and on.

On the other hand, we con­stantly wit­ness vi­brant new com­pa­nies pop­ping up, seem­ingly out of nowhere, who make it big by tak­ing full ad­van­tage of mam­moth new op­por­tu­ni­ties.

op­por­tu­ni­ties are like pow­er­ful mag­nets

In my best­selling book Mas­ter Op­por­tu­nity and Make it Big, I pro­vide the lessons gar­nered by eigh­teen In­dian en­trepreneurs who started with noth­ing and lever­aged huge op­por­tu­ni­ties to cre­ate iconic busi­nesses. Peo­ple such as Sub­hash Chan­dra, Uday Ko­tak, Harsh Mari­wala, and Nir­mal Jain.

Why can peo­ple who start with noth­ing cap­ture great op­por­tu­ni­ties? Be­cause all op­por­tu­ni­ties are free. You never have to buy an op­por­tu­nity. Even bet­ter, the best op­por­tu­ni­ties are like pow­er­ful mag­nets that at­tract all the money and team re­quired to scale suc­cess­fully.

In the course of my con­sult­ing work, I have met sev­eral twenty some­thing In­dian en­trepreneurs who have been able to raise $20 mil­lion+ from US ven­ture cap­i­tal­ists such as Tiger Global. Have VCs in­vested in them be­cause of their track records? Ob­vi­ously not. They have in­vested be­cause of the po­ten­tial size of the op­por­tu­ni­ties they are pur­su­ing.

Smart cap­i­tal al­ways chases the best op­por­tu­ni­ties. As famed in­vestor Prem Watsa of Fair­fax Hold­ings said re­cently, “I have found in my life, if you have op­por­tu­nity, money comes.”

The best op­por­tu­ni­ties are like pow­er­ful mag­nets that at­tract all the money and team re­quired to scale suc­cess­fully.

why so many lead­ers miss op­por­tu­ni­ties

Most great new op­por­tu­ni­ties are not cap­tured by in­cum­bent play­ers. Rather they are taken by peo­ple like those in my book, who came out of nowhere, and started with noth­ing. Why do in­dus­try lead­ers so of­ten turn into fol­low­ers?

In 28 years of con­sult­ing, I have spo­ken to thou­sands of busi­ness lead­ers. Vir­tu­ally, all agree that the choice of op­por­tu­ni­ties is ab­so­lutely cru­cial to suc­cess. It is the re­spon­si­bil­ity of a com­pany’s lead­ers to choose th­ese op­por­tu­ni­ties. It should be their pri­mary area of fo­cus. Af­ter all, if they do not do it, who will?

Yet, iron­i­cally, I have found that most promoters and CEOs ac­tu­ally ‘ac­tively avoid’ fo­cus­ing on op­por­tu­ni­ties. In­stead, they de­vote vir­tu­ally all their time to ac­tiv­i­ties that are ‘not’ op­por­tu­ni­ties, such as fire­fight­ing a vast ar­ray of op­er­a­tional is­sues that they would be bet­ter off del­e­gat­ing to oth­ers. Most hu­man and fi­nan­cial re­sources are poured into fix­ing tired, old op­por­tu­ni­ties, in a never-end­ing bat­tle against the forces of ir­rel­e­vance.

New op­por­tu­ni­ties cer­tainly can seem risky. To mit­i­gate risk, lead­ers of­ten choose op­por­tu­ni­ties based on ‘so­cial proof ’, ie, ‘do what oth­ers are do­ing’. Yet the wis­dom of crowds does not of­ten ap­ply to op­por­tu­ni­ties, any more than it does to in­vest­ing. Buy­ing a stock af­ter ev­ery­one else rarely makes you money, and the same logic ap­plies to op­por­tu­ni­ties.

why you need an op­por­tu­nity process

The fact is, most lead­ers choose poor op­por­tu­ni­ties be­cause they choose op­por­tu­ni­ties poorly. If you do not know how to do some­thing, how could you pos­si­bly do it well? It is a ques­tion of process.

We all be­lieve that sys­tem­atic pro­cesses cre­ate bet­ter out­comes. They are the foun­da­tion of our mod­ern world. Would you choose a sur­geon who does not fol­low a proven process? Would you run your busi­nesses with­out

pro­cesses? Would you choose a wealth man­ager who uses a blind­folded mon­key to pick stocks? Of course not.

Yet 99.9 per­cent of com­pa­nies in In­dia find, eval­u­ate, and choose op­por­tu­ni­ties with­out us­ing a sys­tem­atic process. They largely leave op­por­tu­nity to chance. Ask your­self: is there any rea­son you do not need a sys­tem­atic process to find, eval­u­ate, and choose op­por­tu­ni­ties?

Op­por­tu­nity is sim­ply too im­por­tant to be left to chance. That is why I cre­ated the six-step ‘Open Mind Process’, the world’s first sys­tem­atic process to un­cover, re­cover, and dis­cover op­por­tu­ni­ties for sus­tained, prof­itable growth.

why you must au­dit your op­por­tu­nity en­vi­ron­ment

If you wait for op­por­tu­nity to knock, the chances are that a com­peti­tor will an­swer the door be­fore you. When it comes to op­por­tu­ni­ties, most lead­ers are fol­low­ers be­cause they do not use a con­scious process.

To be con­scious, you must be aware. But aware of what? We are all bom­barded by far too much in­for­ma­tion on a daily ba­sis to pos­si­bly make sense of it all.

When you use Google Maps to get some­where, what is the first thing you need to know? Your lo­ca­tion. It is the same thing with op­por­tu­nity. To find op­por­tu­ni­ties, you must first see them. To see op­por­tu­ni­ties, you must know where you are, and what is around you.

Op­por­tu­ni­ties are cre­ated by con­stantly chang­ing cir­cum­stances in our en­vi­ron­ment. Op­por­tu­ni­ties are adap­ta­tions you can make to your en­vi­ron­ment that greatly ben­e­fit both you and your cus­tomers.

There­fore, it is cru­cial for you to ex­am­ine and as­sess your own ‘op­por­tu­nity en­vi­ron­ment’ in the most re­al­is­tic and ob­jec­tive way pos­si­ble. That is why the step 1 of Open Mind Process pro­vides an ‘op­por­tu­nity au­dit’. An au­dit is a thor­ough pic­ture of re­al­ity, which is ex­actly what you re­quire to un­der­stand your en­vi­ron­ment and clearly see the op­por­tu­ni­ties that lie within it.

how to see, eval­u­ate, and choose op­por­tu­ni­ties Your op­por­tu­nity en­vi­ron­ment has four dis­tinct zones:

■ your mis­sion: where do you want to go? What do you be­lieve?

■ your model: what do you have now? What are your ca­pa­bil­i­ties and re­sources?

■ your mar­ket: what do your cus­tomers want? What are your com­peti­tors do­ing?

■ your do­main: what are the forces be­yond the mar­ket in­flu­enc­ing op­por­tu­ni­ties?

By care­fully au­dit­ing all four zones of your en­vi­ron­ment, you will be able to iden­tify an ex­haus­tive ‘in­ven­tory’ of your op­por­tu­ni­ties—past, present, and fu­ture. This in­ven­tory should in­clude op­por­tu­ni­ties you are cur­rently work­ing on, those you con­sid­ered but never de­vel­oped, oth­ers you missed but could re­cover, as well as new op­por­tu­ni­ties you never con­sid­ered be­fore.

To fo­cus fur­ther, you must then fil­ter the op­por­tu­ni­ties in your in­ven­tory through at least eight key eval­u­a­tors: scale, rel­e­vance, unique­ness, sus­tain­abil­ity, ac­ces­si­bil­ity, suit­abil­ity, ac­tion­abil­ity, and mea­sur­a­bil­ity.

As a fi­nal step, Open Mind Process fil­ters op­por­tu­ni­ties for ‘align­ment’. The best op­por­tu­ni­ties should not only rank high on the eight eval­u­a­tors, but also be highly com­pat­i­ble with all four zones of your op­por­tu­nity en­vi­ron­ment (mis­sion, model, mar­ket, and do­main). Com­pat­i­ble op­por­tu­ni­ties are eas­ier to im­ple­ment and are more likely to have a strong moat, al­low­ing them to with­stand com­pet­i­tive at­tack and pro­vide sus­tained, prof­itable growth well into the fu­ture. ■

To find op­por­tu­ni­ties, you must first see them. To see op­por­tu­ni­ties, you must know where you are, and what is around you.

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