Qi3 – Quality, Insight, Integrity & Innovation - UNITING TECHNOLOGY & MARKETING

Matchmaking in Market Diversification – Is this an Essential New Business Skill?

 

 

 

 

By Robin Higgons

Qi3 has undertaken three projects in less than two years helping defence companies find civil markets for rather clever technologies. In achieving this, it is interesting how important the skills deployed by the matchmaker have been to the success of the projects. Market diversification projects normally focus on the conventional business issues of technology / products, market size, growth rates, drivers for adoption, barriers to entry, competition, etc. While these are essential, key issues of culture and match of business processes can be either forgotten or not appreciated. This understanding and matching of the ‘business personality’ is where the skills of the matchmaker come in.

The defence sector is characterised by large, long-term projects for a small number of massive customers, i.e. the Armed Forces. Key skills for success are tight project management, risk reduction, and long-term product life cycles (20+ years). It has been easy to find a number of significant and growing civil markets for our clients, but some have had major ‘personality’ clashes. Those with short product lifecycles, multiple distribution channels, and diverse, relatively small customers do not match well with the way the defence sector does business.

It is also interesting how this issue has mirrored itself with companies looking to enter the space sector. Space is a massively exciting opportunity with the UK sector forecast to grow from £10bn to £30bn over the next 20 years. Lots of companies are interested in trying to get a slice of the action, but do they have the right ‘business personality’ to be successful. Long timescales of missions and the massive consequences of a failure (you can’t send an engineer out to fix it) make the sector very conservative with a strong emphasis on risk reduction and project management. If your business thrives on technically challenging projects and has the relevant business processes in place, then space is a great opportunity. Otherwise, you may be heading towards a painful divorce.

So, in these difficult economic times, generating growth through new markets is an essential element of business strategy. Do all the conventional research and due diligence, but also understand your business culture and processes and make sure that they match well with the needs of your target market. Otherwise the matchmakers may not have earned their keep.

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