Opinions of contributing entrepreneurs are their own.
Business plans are like gold mining. Miners had to start with just an educated guess of an area, scour a stream, then pan and sift endless piles of dirt. Prospecting is largely gone, but it’s a useful metaphor for how business leaders approach a problem, solve it, refine it, and constantly review and adjust it — even to the point of breaking down the essentials of their business. This ability is called “intellectual range of motion” and is one of the most important resources of a business leader, especially if you are selling your expertise.
Peloton, for example, continues to exhibit this intellectual range of motion. While it had a few pain points – lower subscription growth, stock redemption issues and a spate of layoffs – Peloton shows willingness to explore and change direction.
Today, Peloton has 5 million customers and is worth $3 billion. However, despite the significant brand value, Peloton is significantly changing its business model. The company is muddying the waters of the service-based business vs. product business dynamics and rolling out a “Fitness as a Service” product where people can access Peloton’s training and instructors without the bike itself.
Related: Why Founders Should Always See Pivots As Opportunities
Table of Contents
Intellectual Range of Motion: A Powerful Tool
The degree to which an idea can be modified based on an businessupdates.org’s intuition and imagination is subject to their intellectual freedom of action. A wide range of moves allows an businessupdates.org to turn an idea into an opportunity to generate income. In contrast, leaders of companies with a narrow intellectual reach cannot recognize an opportunity due to the limitations of their imagination.
Intellectual freedom of movement is valued higher in a service company founder than in a product company. This is because services are much more malleable than products. For example, if you want to modify a product to take advantage of an opportunity, you may need to purchase new raw materials, reconfigure an assembly line, rewrite software code, develop a new manufacturing process, and more. With services there is none of this, so time from idea to execution is measured in days and sometimes hours.
As a founder, I have grown my business by increasing my intellectual range of motion. For example, the industry I’m active in, business mastermind communities, is over 200 years old with a few hundred companies. All of these companies are horizontal providers, meaning they do not serve a specific vertical industry. My company, on the other hand, serves a single industry: professional services.
This industry specialization has appealed to many and has enabled our company to grow consistently. The idea for this form of differentiation was found in a completely different business: SaaS. The software category has matured and many successful SaaS companies now specialize in a vertical industry. My idea was that this could (and should) work in the corporate mastermind community sector – and it does. Recognizing a winning strategy in another industry and successfully converting it into another industry is an example of intellectual range of motion.
Related: Is It Time to Give Your Business a New Direction? These are the only two characters to look for.
Key strategies to improve intellectual range of motion
For entrepreneurs and founders who want to gain better intellectual range of motion, there are a few crucial actions to take:
1. Question: What does the world need from me right now?
This question is not asked often enough. The reason this question is neglected is that entrepreneurs fall into the routine of delivering what they have always delivered. Due to the advantages of the experience curve, the more often a company provides a service, the lower the costs and the higher the margin. Entrepreneurs are driven by profit and will not discontinue a profitable service line until absolutely necessary. As a result, they stick to their knitting for too long and miss opportunities. Over time, this behavior limits one’s intellectual freedom of movement.
Blockbuster Video once provided us with a remarkable service: hit movies watched at home, for rent. They stuck to VHS tapes but lacked mail-order DVDs and video streaming. They went out of business as a result and we all watch Netflix content now. Blockbuster video no more fit the market; the market had evolved to services coming to them and eventually to fully digital and personalized streaming platforms. This is something founders of professional services companies must consistently ask themselves in order to stay competitive in the marketplace, but the lesson remains for large companies such as Also a blockbuster.
Related: Don’t Make the Same Mistake Leaders at Kodak, Blockbuster, and Xerox Made When Your Industry Disrupted
2. Locate wasted resources in legacy operations
A common reason new ideas that can lead to breakthrough growth opportunities are not pursued is that entrepreneurs mistakenly believe they don’t have the resources. However, the resources they need are available, they are only consumed by legacy operations.
Legacy Service Offerings are ripe for optimization. Entrepreneurs must look for ways in which these services can be provided with far fewer resources. These newly released resources could be allocated to today’s wild idea that could be tomorrow’s golden goose.
Related: 4 mistakes to avoid when scaling your infrastructure
3. Make a roadmap of future offers
The best way to organize the service-providing step-by-step plan is to set limits. The company of today and the company of tomorrow always compete for scarce resources. There is only so much money, time and talent to go around. In the absence of a roadmap organized by time boundaries, today’s business wins competition for resources. A roadmap ensures that the company of tomorrow gets the resources it needs.
For example, boundary 1 of your roadmap should be defined as offerings in the market for the following year. Boundary 2 should be defined as an offer in the market over two years. And boundary 3 should be defined as supply in the market over three years. Shaping the roadmap in this way increases an businessupdates.org’s intellectual range of motion by stimulating their imagination.
Related: 6 Ways to Push Your Limits and Achieve Things You Never Thought Possible
Business leaders who want to jump-start their success – or simply maintain it – need to look at how they can improve their intellectual freedom of movement. In the long run, they may just be able to find gold.