Dr Jeff Cornwall

This week’s question for Forbes magazine’s America’s Most Promising Companies initiative comes from Brett Nelson, Entrepreneurs Editor at Forbes:

Small companies must get creative to survive the recession—even going so far as to branch into new lines of business (assuming they have the cash to do it). But mission creep comes with serious risk. What are some tangible do’s and don’ts about expanding your product line?

Why should a small company change their product line?  For only one compelling reason — the market is taking them there. 

Entrepreneurs typically rely heavily on their
business plans when the time comes to launch their new venture. It is a
plan that they may have agonized over for weeks, months or years. They
have done their research, creating a carefully thought-out business
that justifies their financial forecasts. But then a funny thing
happens. They assumed in their business plan that the market wanted
“A.” But if they listen carefully to the customer, they often find out
that the customer really wants “B.”

I call this learning to “dance with the market.” And you should be ready to let your customers lead in this dance.

The need to listen to the market never really ends. Markets are dynamic, so you need to be ready to follow where they lead, particularly during times of rapid change and turmoil in the market as we are experiencing with the recession.

What should you be cautious about when it comes to adjusting your mission?

Don’t move so far off of what you are known for that you lose your customer base.  There may be opportunity beyond the boundaries defined by your mission, but these opportunities may end up redefining your business so much that you confuse the market.