The Opportunity in Imperfection
All businesses have imperfections. Some are easy to fix, and some can be hard to overcome. It’s how we react to these imperfections that can make a big difference in the eventual growth and success of a company.
As an entrepreneur, it is easy to get discouraged when you find imperfections in your business. I have learnt to celebrate them. For example, if you have been under-billing your customers due to an error in your billing system, a simple software fix can quickly increase your top line. If you are overpaying for office supplies, you can simply change suppliers and reduce your cost basis. And as a software company, if your application is running too slowly, fixing the issue might be as simple as creating a new index on a table within a database.
These types of everyday imperfections are easy to fix. Often it’s the seemingly “perfect” businesses that are the most challenging of all. Improving such a business is far more difficult. That’s because there is not as much low-hanging fruit, and every improvement demands significant effort. It might mean building a new and innovative product, taking a big customer away from a competitor, or creating a new process to improve the delivery or support of your solutions. None of this is as easy as fixing a modest imperfection.
One of the areas where TEOCO leverages its strength in fixing imperfections is in the domain of mergers and acquisitions (M&A). Vibrant Solutions was our first. The company had talented people, strong domain expertise in telecom cost management, and a loyal client base, but it lacked working capital. By leveraging our financial strength, the combined business grew to become the dominant player in this niche market. Likewise, with our acquisition of Vero Systems, we introduced the concept of recurring revenues. When we combined that with adding a key customer, we were able to convert it from a business unit that was struggling to pay its bills into a reliably profitable least-cost-routing solution.
Our next opportunity took us to Israel, where we acquired TTI Telecom. TTI had an integrated network Fault and Performance Management Solution called Netrac that was competitive, but our inexperience in running a global sales team curbed our ability to fully leverage the company’s assets. Continued investment in evolving this solution has created an industry leading state-of-the-art platform, now rebranded as Helix, but we still suffer from a key imperfection: lack of committed channel partners that can give us a global market reach. When we fix this ‘imperfection’, I believe it will significantly accelerate our growth in this space.
In the end, it’s not the challenges we face that determine success or failure. It is how we decide to react to these challenges that matter!
With special thanks to Srinivas Bhogle for his support and contribution to this project.