There are two primary ways to procure skills that don't exist in your organization. The first, building expertise, refers to training current employees in the new areas. The second, acquiring expertise, involves either hiring new employees or partners or merging with another organization so that the requisite skills are instantly available.
I talked to three business owners—Robby Berthume, CEO of advertising agency Bull and Beard in Winston-Salem, North Carolina; Kayla Wagner Faires, CEO of digital marketing firm Revel Interactive in Denver; and Rahul Varshneya, CEO of mobile application developer Arkenea in Carrollton, Texas—who made the decision to train existing staff, hire new people with certain expertise or acquire another company.
How did you decide you needed to expand your business?
Rahul Varshneya: A service business is a people business. People buy from other people based on trust. Once you have a set of people that trust you, it's easier to upsell and cross sell and [that] opens up other channels of monetization. Our passion to add more value for our customers now and for a lifetime leads us to expand what we have to offer.
Kayla Wagner Faires: We take cues from our clients regarding what is most valuable to them and expand accordingly.
Robby Berthume: First of all, we determine if the expansion is aligned with our brand, business model and growth strategy. If it meets that initial criteria, we validate [if] the market wants it, validate if the market is willing to pay for it and validate that it won't negatively impact other areas of our business or lead to opportunity cost.
Beyond this, we launch new products, services and competences using a Minimum Viable Product (MVP) style approach. Too many entrepreneurs and business owners lose their focus by going all-in too quickly. Tread carefully until you know you have a winning addition.
What has been your process so far for adding products, services or competencies to your existing offerings?
Berthume: I frankly don't pay much attention to competition, nor do I let my clients dictate whether or not I expand on my offerings. That client need could be an anomaly, and the competition generally follows a herd mentality.
I don't want to imitate, I want to innovate. I'm generally wary of spreading our brand and service offering too broadly and adding products or services too quickly.
Wagner Faires: We take a strategic approach with a few lenses as we consider adding services. Does it fit within our company's values? Can we provide the service at an exemplary level to our customers versus the competition? Is there a definite customer need for it? If we can say yes to all three, we consider bringing the service on, usually with a trial run first.
Varshneya: We continuously look to add products and services to our existing offering. The process is pretty simple and straightforward. We brainstorm internally and then survey our existing and potential clients on every product or service they have bought or intend to buy that complements our offering.
For the rest of the interview, head over to the AMEX Open Forum.