Have you ever wondered why technology start-ups aggregate in Silicon Valley like moths to a flame?
Office space is expensive. Hiring
employees in the valley is costly. Competition
for talent is fierce. Buying a home is
cost prohibitive and traffic is horrible.
Yet start-ups continue to locate here.
What are the attractants? Let's consider the following:
Traditional consulting practices promote the fact they
have decades worth of accumulated business processes, system designs, economic models,
methodologies and experiences from years of providing IT and business strategy consulting
to large multinational companies. The problem is the large legacy S&P 500 companies are not the models for agility and digital acumen today - think about the trouble GE is in. Today the average number of years a company can stay in the S&P 500 is predicted to be only 14 years. Today, agile Silicon Valley companies are the ones commanding the most attention.
Having Silicon Valley DNA today is more important than archives full of historic processes and decades of experience deploying legacy systems. Silicon Valley is the very epicenter of digital transformation and the companies here think and act differently. Silicon Valley DNA is a digital mindset, a paradigm, a culture, a perspective and an operational
strategy. It assumes there are
competitive advantages to be found in change and innovation - just waiting to be exploited. It
aggressively pursues new business models and innovations based on the belief
there is value in learning, whether the experiment is a success or a
failure. It seeks examples of successful
proof of concepts across all industries, and then seeks ways to apply those
findings to other business problems and situations.
Consulting companies with Silicon Valley DNA are not
attracted to projects involving the implementation or deployment of legacy
technologies and business models.
They
may do them, but only as a means to an end, which is to
get more challenging and transformative projects and business. They seek opportunities
to help companies advance, in leaps and bounds, rather than in small risk-free
iterations.
Businesses with real Silicon Valley DNA are located in the
Silicon Valley. It means they are
surrounded by innovative people both inside and outside the company that are
working with and learning about emerging technologies and business and economic
models every day. It means they are
collecting and working with new ideas every day - assembling and reassembling
them to form new products, services and businesses. It means they have unleashed their employees’
creativity to integrate and test unique combinations of technologies in search
of additional value.
Being located in the Silicon Valley and having Silicon
Valley relationships also benefits new start-ups seeking to fund interesting
ideas and new ventures. In addition, start-up
teams benefit from being in close proximity to experienced technology leaders,
investors and advisors.
Consulting companies with Silicon Valley DNA, are made up
with people that think differently. They
thrive in an environment and culture that attracts ambitious, competitive and
driven innovators and entrepreneurs.
They are not seeking status quo, but rather they are trying to make a
positive impact through change.
Where many traditional businesses struggle with change and
experience a deep-set institutional and leadership resistance to it, businesses with Silicon Valley DNA recognize change as an opportunity to capture additional
competitive advantages and deliver more value.
Businesses with Silicon Valley DNA also look at risk
differently. Where traditional businesses might fear risk and see it as something to avoid, Silicon Valley companies are willing to work with it. They see risk as a gateway
to potential opportunities and competitive advantages that are worth exploring.
Silicon Valley consulting companies often have an abundance
of knowledge and experience on how to take an idea from a concept to a new
business ventures. Often within
leadership teams they have the accumulated experience of having worked in
dozens of different start-ups. This
experience has shaped them into entrepreneurs.
Their natural approach to any project is from a business start-up perspective. This mindset is missing from many consulting
companies that focus primarily on staffing and long-term ERP implementations
and deployments.
Another Silicon Valley DNA character trait is a healthy
disrespect for how things have been done in the past. Traditional market rules and behaviors,
business model norms, institutional and industry practices are often not
respected. In fact, they are often
viewed as mere artificial limitations created by incumbents for the purpose of
protecting their own status quo and limiting customer choices and options. In the Silicon Valley rewards are given most
often to those that think out-of-the-box, not to those trying to fit in it.
Silicon Valley consulting companies and entrepreneurs often believe in fuzzy
math. They believe that 2 + 2 does equal
5. They have witnessed firsthand
entrepreneurs networking independent car drivers together with ubiquitous
wireless broadband, maps, mobile apps, mobile payments and a demand for
transportation into – Uber! They have
experienced the value of collecting concepts, ideas, technologies and best
practices from many different industries and combining them into new business
models that thrives and add exponential business value!
Businesses with Silicon Valley DNA by their very
nature also look beyond technologies.
With an entrepreneurial mind they consider competition, markets,
regulatory environments, industry trends and much more. This is a requirement for start-ups and these
considerations are embedded in their approach to consulting.
We have of course generalized in this article. Not every business with Silicon Valley DNA is geographically located in Silicon Valley, but having this DNA is a huge advantage.
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Kevin Benedict
Senior Vice President, Solutions Strategy, Regalix Inc.
***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I work with and have worked with many of the companies mentioned in my articles.
