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40 Business Survival Imperatives

| On 01, Sep 2008

By Gennady Retseptor

How can a new business enterprise survive in a world of total globalization? What are the main principles it must follow? Which principles possess the highest priorities and can be defined as imperatives for business survival?

The 40 inventive principles of the Theory of Inventive Problem Solving (TRIZ) help answer these questions. There are numerous examples that demonstrate the successful application of these principles in non-technical fields, such as business management, social relations, quality management, marketing and others.

Based on his research anddevelopment, engineering and quality managementexperience, the author has attempted to formulate business survival imperatives using the 40 inventive principles of TRIZ. The imperatives are divided into several hierarchal categories:

  • Priorities
  • Research and development
  • Competitors
  • Customers
  • Suppliers

These business survival imperatives may be useful for managing new and growing companies.

Priorities

Principle 3. Local Quality (Non-uniformity)

A.Set the right priorities – the top priority should be research and development (R&D). Competitors, customers, suppliers, employees, shareholders and other interested parties are prioritized afterward.
B.Cura nihil aliud nisi ut valeas – “Take care of nothing except that you do well.” (Cicero)
C.The supreme goal of a business is to constantly develop and introduce new products, which possess unique features and provide significant advantage over the competitors. Avoid the “Seven deadly diseases that management must cure.” (W.E. Deming)

Principle 7. Nesting

Search niches for the creation of new products inside existing market segments.

Principle 11. Beforehand Cushioning

Establish appropriate back-ups for business interruption and contingency planning.

Principle 20. Continuity of Useful Action and Principle 36. Phase Transition

Be aware of the s-curve for marketing and sales evolution – different products or service life stages: “problematic child,” “star,” “milky cow,” “outsider.” A new “star” must be timely if replacing the current “milky cow.”

Research and Development

Principle 3. Local Quality (Non-uniformity)

Managers may replace, reposition or downsize manpower in marketing, finance, engineering, production, quality, maintenance, purchasing, safety, human resources and other departments without a significant negative impact. All of these employees are important, but not essential. Only outstanding scientists, designers, technologists – properly selected and nominated to the right positions in R&D, are vital. Without these individuals a business will not survive in the long-term. But short-term, without someone highly skilled and creative in financing, the business will not survive long enough to make R&D pay off. It is important that the chief executive officer and other senior managers have finance and relationship skills, not just R&D, to get and retain investors.

“Vital few and trivial many.” (J. M. Juran)

Principle 19. Periodical Action and Principle 18. Vibration

Periodically revise R&D activities to inject new enthusiasm into projects.

Principle 20. Continuity of Useful Action

A.Invest in continual education, knowledge and skills renewal of the R&D personnel.
B.Expose key designers to external events: conferences, exhibitions, lectures, seminars, etc. Let designers learn from customers, suppliers, business partners and organizations from the same or other fields.
C.Use all available resources.
D.Provide key R&D personnel with the best possible employment contract conditions: salary, insurance programs and other benefits.
Reddite ergo quae sunt Caesaris, Caesari – “Give Caesar what’s Caesar’s.”(Vulgate Bible)
E.Encourage breakthrough solutions, knowledge – patent grants for inventions by giving appropriate rewards: bonuses, promotions, status elevations, etc.
F.Foster the self-esteem of R&D employees.
G. Thoroughly protect the intellectual propriety rights of inventors, and share with inventors the profit received from their inventions. Suum cuique – “To each what he deserves.” (Cicero)

Principle 25. Self-Service

Institute self-benchmarking and internal competition in R&D.

Principle 34. Discarding and Recovering

Dismiss persons who are non-effective and replace them with better candidates. This will preserve R&D capabilities and lead to the creation of new products.

Principle 38. Boosting Interactions

Businesses need people who are not only idea generators by themselves, but can hijack on the ideas of each other, amplifying their creative powers and developing breakthrough know-hows and inventions.

Principle 40. Composite Structures

Choose for R&D the outstanding, highly creative, multi-skilled, “renaissance” people.2

Multi sunt vocati, pauci vero electi – “Many are called, but a few chosen.” (Vulgate Bible)

Competitors

Principle 9. Preliminary Anti-Action and Principle 11. Beforehand Cushioning

Appropriately protect R&D activities from the competitors’ intelligence, and use proprietary rights protection – patents, licenses, trademarks, copyrights, etc.

Principle 10. Preliminary Action and Principle 9. Preliminary Anti-Action

Continue to measure employee morale to prevent R&D personnel from transferring to a competitor.

Principle 12. Inverted, Potential Energy Gap

Build entrance barriers for competitors by enhancing a product’s advantages.

Principle 13. Inversion

Inversely, strive to employ prominent specialists from competitors’ R&D.

Principle 19. Skipping and Principle 23. Feedback

Promptly learn lessons and derive conclusions from each defeat in competition.

Principle 22. Blessing in Disguise

Use the competitors’ success for benchmarking providing a stimulus for re-gaining the primary position in the market.

Principle 23. Inverted, Feed-forward

Get intelligence and inverse engineering on the competitors’ products in order to anticipate their future activities and develop counter-measures.

Principle 32. Color Change

Introduce smoke-screen misinformation to disguise confidential R&D activities.

Customers

Principle 4. Inverted, Symmetry

Never allow the customers to gain supremacy over the business. The customers depend on the business just as the business depends on them.

Principle 5. Merging

Cooperate with customers to create new products with unique features.

Principle 6. Universality

As customers’ expectations increase, businesses must diversify their products. Similarly to principle 3: local quality, products should specifically fit a local (customer) need.

Principle 7. Nesting

Provide a product that exceeds customer expectations because of unanticipated extra features that bring about an element of surprise – the “wow” factor.

Principle 8. Anti-Weight

Principles 8 and 3 focus on making each product specifically fit a local (customer) need. Strive to achieve design-wins at brand name customers. They can promote the product.

Principle 11. Beforehand Cushioning

Run b-site customer pilots to gather information on high-risk products prior to distributing them to the general market.

Principle 12. Equipotentiality and Principle 20. Continuity of Useful Action

By having a unique product, businesses acquire a strong market power and may dictate their terms to customers. Actually, the business becomes a monopoly producer. Nevertheless, it must preserve parity and partnership relations with its customers. The reward is great – their loyalty and retention.

Principle 13. Inversion

Make designers act like the customers.

Principle 5. Merging and Principle 20. Continuity of Useful Action

Establish long-term business alliances with key customers.

Principle 22. Blessing in Disguise

Use customer complaints and field failures as not only valuable feedback, but also opportunities for improvement.

Principle 22. Inverted, Cursing in Disguise

Be wary of rare customer complaints. This could indicate a lack of customer candor and an unwillingness to share information or employee screening of information.7

Principle 23. Feedback

Enlist customers into the R&D activity loop.

Principle 23. Inverted, Feed-forward

Anticipate and nurture future customer needs.

Principle 25. Self-Service

Have customers advertise the product.

Principle 38. Boosted Interactions

Excite customers about the product by providing them a sense of advantage to be gained over their competitors.

Suppliers

Principle 2. Taking Out

Transfer non-core activities to the best subcontractors.

Principle 4. Asymmetry and Principles 9, 10 and 11

Avoid suppliers that might become a monopoly and dictate their terms.

Principle 5. Merging

If a business fails to find a second source or an alternative design solution, it should merge with a single-source supplier.

Principle 11. Beforehand Cushioning

A unique product cannot survive in the market if a business relies on a single-source supplier for critical parts or materials.

Fortune

Audaces fortuna iuvat – “Fortune favors the brave.” (Virgil)

References

  1. Mann, D. and Domb, E., “40 Inventive (Business) Principles with Examples,” The TRIZ Journal, September 1999.
  2. Terninko, J., “40 Inventive Principles with Social Examples,” The TRIZ Journal, June 2001.
  3. Retseptor, G., “40 Inventive Principles in Quality Management,” The TRIZ Journal, March 2003.
  4. Retseptor, G., “40 Inventive Principles in Marketing, Sales and Advertising,” The TRIZ Journal, April 2005.
  5. Retseptor, G., “40 Inventive Principles in Customer Satisfaction Enhancement,” The TRIZ Journal, January 2007.
  6. Retseptor, G., “40 Inventive Principles in Latin Phrases,” The TRIZ Journal, January 2008.
  7. Deming, W. Edwards, The New Economics, Cambridge, Massachusetts Institute of Technology, 1994.