Execution is king: Project plans are great but you also need the right resources
On the road to get funding for your project, investors as well as public funding entities aim to ensure that the company will have the best resources to complete the project. No matter who is making the project/startup evaluation, whether a private investor, a VC or a grant evaluator, if they are experienced, they will pay special attention to evaluating the existing capabilities.
We have seen many failures just because the necessary capabilities are not there. Indeed, not having the right team and resources is usually rated as the third reason behind startup failure. The more effort you put into thinking through the types of resources you need and identifying them far enough in advance, the easier it will be for you to complete your project on time, on budget, and to the required specifications. Depending on the type of project and departments involved the resources will differ, but essentially, resources can be divided into two categories: internal and external.
Project resources are the people, capital, and/or material goods required for the successful execution and completion of a project.
It refers to the team, the equipment, the development methodologies, and the organizational structures. It is extremely important to build a strong team and create a good balance of technical and commercial profiles. This is tricky for science-based companies when all involved profiles are technical and there is a need for finding a new CEO or Commercial Manager. Because this is a difficult conversation, we have found that working with an external experienced consultant like us facilitates the internal debate. We can even help with the process of finding and evaluating candidates. Companies must also create an effective and efficient organizational structure. An horizontal structure in which everyone is “co-founder” might be good for a rapid start, but it will usually encounter important challenges later on.
The process of assessing the internal resources can also be seen as a matching mechanism that goes in both directions. Looking at the project needs, you must try to complement the project resources accordingly. But if you are not able to have a perfect match, you can also go back and revisit your strategy. We have seen several good examples of this second case when science-based companies try to set up a manufacturing business. In some cases, the difficulty in getting all the necessary resources to run such a different business model recommends to re-assess the project and it might lead to a different strategy in which the manufacturing process is left outside (outsourced) of the company.
A bi-directional matching mechanism shall be used: You must find the right resources for the project but also you must change the project strategy if resources are not there
In today’s organisations and especially in startups, the boundaries between internal and external are diffused. This is why it has become extremely important to be able to capitalize on external resources such as partners, collaborators, investors, coaches, etc. For small agile organisations, having the right outsourcing strategy is key, because the financial capabilities might be very limited and CAPEX must be kept to a minimum. In particular, science-based companies must carefully manage the relationship with Universities and R&D institutes to be able to exploit their resources (either soft (people, knowledge, services, network, etc.) or hard (offices, equipment, labs, etc.).
Other typical resources that are kept external for science-based companies are legal and in particular IP processes. Marketing capabilities can require an in-depth analysis since, although it is common sense to outsource marketing or website design, the core commercialization resources should be in-house.
In startups, the boundaries between internal and external have become blurred and capitalizing on external resources is one of the crucial arts of entrepreneurship
In our experience, companies and especially startups struggle in assessing objectively their resources and capabilities and identifying the gaps. Besides, it is not always easy to fill these missing traits. In some cases, the challenge to bring in-house the necessary resources may lead to externalising some of them. But on some occasions, the company can also be pushed to change its strategy. An external view from experienced business coaches and consultants may be extremely valuable in this process.