It was a simple question. How did Rich Bravman, CEO of Intelleflex, help build his last company, Symbol Technologies, from a four person team to a 1.7 billion dollar firm? And what techniques from that ascent was he using in his new startup?
The answer rolled out in a high speed, no-breathing-allowed discussion that wrapped up in just 45 minutes. The trick: He works to build companies that innovate to create entirely new product categories in which they take commanding market share leadership. They repeat the performance over and over again, building revenues and shareholder value.
That gem came out in the first five minutes because that’s Rich's primary and public strategy. Everyone on his team knows it. It's what they do. So I dug in.
The commonality between Symbol’s products (bar code scanners, handheld computers, wireless LAN) and Intelleflex (extended RFID) is not accidental. Rich's deepest expertise lies in the world where atoms meet bits. That’s where the physical existence or physical state of things becomes a data stream, ready for interpretation or action by a computer. The industry calls it automatic identification and data capture. This is the space in which Rich and his team own an impressive core competency.
At Symbol, the team he was part of, and eventually led as CEO, brought the world the first hand-held laser scanner in 1980, the first scanner-integrated mobile computer eight years later, and to connect them all, the world’s first WLAN (based on spread spectrum technology). Within this layer that links computers to the physical world is where they look for opportunities that seem to have a big future, and where they can create and defend a category against competitors.
They key is finding a match between a differentiated technology that uniquely meets a high value need spanning multiple industries. For example, in the case of Intelleflex, they saw that bar code technology only went so far. The existing passive RFID products satisfied more needs, but left a gap in functionality that was un-filled. When Rich saw the Intelleflex technology developed by the founders, he knew that he could fill that gap.
Extended capability RFID, while more expensive than the simplest forms of the technology, offers a host of critical advantages: greater range, more memory, works in difficult environments and can be a platform for sensing and reporting much more than just identification information. Low cost RFID for high volume, ID-only applications were not new and not a category that Intelleflex could create, lead or defend. But extended capability RFID looked good.
So Rich's team fanned out and started looking into all the applications for this enhanced form of RFID. Would museums want extended RFID to report on the whereabouts and condition of the master’s paintings? Would construction companies want to use this for their big equipment? Would power generation plants want to use this to report conditions within an operating facility? The sales team met with top companies representing nearly 100 applications in about as many industries.
Just as consumers didn’t know they would want a Macintosh until they saw it, Rich seeks solutions that the customer hasn’t really thought of yet---that they don’t realize the benefits they could reap. He focuses on the mid-term future, because he needs that much time to develop a product and place it, before other competitors or other technologies threaten to dominate. Rich Bravman often creates presentations that paint a picture of the future of the technology in an application area. Whether his predictions are right or wrong, it stretches the mind of the market-savvy executives in the audience, and the open and candid feedback that follows yields gems that point the way.
All this field research and visioning generates a long list of applications that fit the technology. Chasing all of them is a trap. There is too much to be learned and too much work to tackle more than the one or two applications with the greatest promise for success. Creating a category is great and deserves a place on any resume. But leading that category is what generates shareholder revenue and the momentum for repeat performances in successive related categories. Intelleflex’s list was whittled down to a few “Horizon 1” applications, including reusable transport item (totes, bins, containers), equipment yard tracking and vehicle yard management. The rest would have to wait until later.
The process requires all-star teamwork and commitment to meld product and technology development with the search for the ideal category to create and lead. Rich drew on a tool he used at Symbol: interactive business planning. He built his own private web-based groupware that was visible by everyone at Intelleflex and where everyone’s participation is required. The process takes four months, but the level of involvement creates understanding, alignment, commitment and resolve throughout the organization. The end product has mission, vision, measurable objectives, strategies and actions plans clearly laid out, and Rich communicates about the plan over and over again, using multiple modalities. This level of planning is critical because they won’t be satisfied with selling only to early adopters; success will only be realized when they move the market “across the chasm” to more mainstream customers.
Early adopters help validate your product and strategy, but there aren’t enough of them to grow a large business. They are often as interested in technology as in business results. Rich instead focuses on finding and working with known companies that have compelling business problems that can be uniquely addressed by system solutions based on his products. Make enough of these customers successful (in business terms), and the market for his product takes off, with Intelleflex in the lead.
The momentum builds quickly using Bravman’s technique. Motorola announced on December 17th, 2007 that they were partnering with Intelleflex to develop a new platform for a set of extended RFID solutions for customers worldwide. Be assured that the list of applications targeted for Intelleflex leadership is growing, and Rich's team is looking to repeat Symbol’s success. Before you know it, Intelleflex will be the “gold standard” in the categories they created.
Thought leadership and focused innovation leads to market share leadership and profitable growth. Crafting and making work partnerships with companies the size of Motorola takes a lot more work, more investment, and more time than logging sales to some small early adopter, but that work is done while the category is still largely undiscovered. Bravman works under-cover until he lands a solid customer or partner that gives him a huge head start.
The simple question I asked yielded a fast and clear answer, in just 45 minutes. But there is nothing simple or easy about executing a plan to create and lead a category. Yet Rich Bravman has shown us it can be done. Now it’s your turn.
- Carefully listen to your customers to identify new categories just over the horizon. Then create new products and services that you can protect.
- Focus in on one or two applications for that product and get the leading companies in that application to use your product. This will guarantee you leadership in that application.
- Involve your whole team in the planning process, getting everyone on board and working hard.
- Once you have success and cash flow, begin tacking more applications for the same innovation.