Written by Jay Turo on Monday, October 15, 2012
Probably the worst way for an entrepreneur to begin his or her day is to read the newspaper.
Or watch the news.
Or, for that matter, to surf the net or even check in on the latest and greatest on Facebook, LinkedIn, Twitter, et al.
It is not to say that keeping up with events is necessarily a bad thing, and of course for many types of businesses and professions, it is part of the job description to do so.
But for the busy and ambitious entrepreneur, doing so first thing in the morning at best is highly distracting, and at its worst misdirects one's mind and energy in the absolute wrong direction.
Well, unfortunately the overwhelming majority for what passes as “news” these days is a downbeat recital of the things that either have, are, or are about to go bad the world over.
War. Economic crisis. National disasters. Scandal.
All usually presented in that oh-so depressing of "yes this is bad, but just wait because it's only going to get worse" tone.
Not the best “stimulus” with which to start one’s day to get out and conquer the world, now is it?
Yes we should be informed.
But really, it is not the “informed” that change the world for the better.
Rather, it is the men and women of action, purpose, and zest that do.
And these energized and effective souls don’t start their day with the “news.”
Rather, they feed their spirit, minds, and bodies wholesome fare.
They meditate. They read inspirational literature. They exercise vigorously.
They set their day's goals and get right after the most important ones first thing.
They recognize that the first hour is the rudder of the day and so they tack their daily ship in the best direction right from the day’s get go.
And once they are good and going…
…well, then they take a peek at a few tweets, they accept a few friends requests, and they indulge themselves in a little of the “news.”
But not too much.
This blog post is a reprint of an article written by Jay Turo in this month’s Vistaprint Small Business Blog.
Written by Jay Turo on Monday, October 8, 2012
As any venture capitalist worth his salt will tell you, there is a chasm of difference between the mostly grounded-in-reality financial forecasts offered by public companies, and the almost never to come true "rosy scenario" projections offered as a matter of course by startups and small businesses.
And while large public company CEOs and CFOs are judged as a matter of the highest honor on their ability to deliver on projections, exceedingly rare is the entrepreneurial executive that comes anywhere close to meeting forecasted results.
For a sense of the extent of how bad this problem is, a partner I know at a prominent venture capital firm estimates that of the 30+ companies that his firm has invested in, only two have consistently met or exceeded their financial projections.
And let me add that it isn’t like the inmates are running the asylum at my friend’s fund - as a prerequisite of having them as an investor, each of their portfolio company CEOs are required to undertake and report on a vigorous, quarterly budgeting and forecasting cycle.
And also let’s not assume that my friend is just a lousy investor. Lack of consistent financial performance is pretty much par for the course for startups and small businesses.
So what is going on?
Are the entrepreneurs just not ready for prime time? Are their managerial skill levels that many levels below their big company brethren?
I’ll say this - it is certainly not for lack of trying.
Most small technology company executives work longer hours than businesspeople have at any time in history.
If you doubt this, pick up Ron Chernow’s masterful biography of John Rockefeller.
In it, we read enviously of Mr. Rockefeller's daily 9:15am visits to his barber, his afternoon naps, and his unwavering commitment to always leave the office each day, no matter the season, so he could be home before dark.
And it is not for a lack of know how.
Modern entrepreneurs - with their always-on, “click of a button” best practice knowledge and connections base - are a better informed and more globally networked lot than at any time in history.
So if they aren’t the problem, is it modern business itself?
Has it just become - with all of its technological bells and whistles, all its globalization and pricing pressures, all of its customer unpredictability and fickleness - just too unwieldy a beast for any small company to ever consistently ride?
And concurrently, has accurate financial forecasting become equivalent to throwing dice?
Or more disturbingly - is it not even worth doing as even when they do turn out to be accurate it just falls into the category of the blind mouse getting some cheese every now and then?
For better or for worse, modern business demands that we take a more “balanced scorecard” approach in judging managerial effectiveness and entrepreneurial progress.
Factors like intellectual property development speed, organizational design, and client satisfaction as measured by a companies’ net promoter score are proving to be just as important predictors of a business’ value creation as is its forecasted-to-plan accuracy.
Please let me be clear: on their own these factors do NOT make a business valuable.
Rather, the right matrix of them, properly prioritized, IS highly correlated with businesses that attain high profit exit and investment outcomes.
As an added bonus, these non-financial key performance indicators (KPIs) can be designed to be far more consistently predictable than traditional projections.
As such, they are usually far better measures of executive effectiveness than budgeting and forecasting “gap analysis.”
You just have to have the guts to forget about the numbers for a quarter or two.
Or, if you are really get good at defining, tracking, and accomplishing the right non-financial KPIs, to forget about them permanently as they will just take care of themselves.
Now wouldn’t that be nice.
Written by Jay Turo on Monday, October 1, 2012
Holding constant for socioeconomic factors, the typical entrepreneur makes less money, work more hours and suffers more work-related stress than their employed counterparts.
And when we combine these statistics with those that show a very incredibly low percentage of startups and small businesses ever attaining meaningful profitability, it is remarkable that people ever even dream to be entrepreneurs and start businesses at all.
But start them they do!
Quite possibly the most amazing and inspiring number in all of American business is 550,000.
That is the approximate number of new businesses that are started in American each and every month, or more than 6 million per year.
Now these opposing statistics beg the question, “Why?”
Why would 550,000 people - who statistically are far better educated and wealthier than the population as a whole - engage in behavior that on the surface clearly seems contrary to their self-interest and dare I say, delusional?
Well, on the cynical side, many of these brave folks probably think the odds of economic success are greater than they really are.
And even if they know the odds, they think that they don’t apply to them.
On the slightly less cynical but still not totally inspiring side, one could argue that businesses are started out of boredom - out of the need for that “action rush” that in the realm of business often only an entrepreneurial endeavor can truly provide.
Inspirationally, many believe like I do that entrepreneurship is the greatest force for positive change in the world today, and they start and grow businesses to be positive change agents, on levels big and small.
They start restaurants to create and share beautiful food, service, and atmosphere.
They open day care facilities to provide quality, spirited child care for working families.
They start creative agencies - graphic design, public relation, web development firms, and the like to leverage their business and creative talent to its most effective end.
And they start drug development and medical device companies to help people live longer, healthier lives.
And thousands of types and forms and sizes of business in between, led by entrepreneurs with aspirations big and small, driven by motivations both pedestrian and soaring.
But at the heart of all of their reasons for starting businesses, at least of the ones that survive, is that often begrudged but really most inspiring motivation of them all.
They start businesses to make a lot of money.
Now the key word in that sentence is make - as in bringing into existence through creativity, effort, and as often as not more than a little serendipity and luck, something that did not exist beforehand.
Making money is the difference between Mo Ibrahim becoming a billionaire through bringing inexpensive mobile telecommunications to millions in Africa and Mo Gaddafi stealing billions of his people’s money at the point of a gun.
It is the difference between Steve Jobs and Apple creating $630 billion in market capitalization - and untold additional hundreds of billions in economic and multiplier effect.
Now often, for the entrepreneur and those that back them, the touching of this money often takes many years, even decades, of under-paid, hard, and often thankless work, before a cash windfall in the form of a business sale or a public offering.
But that is a story for another day.
For now, find those entrepreneurs that can truly make money, encourage and back them, and you and the world will get to a better place.
Written by Jay Turo on Monday, September 24, 2012
Modern businesses, massively reliant on information technology, are faced with a fundamental question - should they organize “traditionally” via single locations where salaried “W-2” employees work, or should they exist primarily in “the cloud” - with far flung networks of “1099” contractors, vendors, affiliates and the like?
Let’s label the two approaches “old school” and “new school” and explore their pros and cons:
W-2 Old School Positives. You can spin virtuality anyway you like, but human beings are fundamentally designed to work together in 3 dimensions, in-person.
Among many other, an incredibly KEY benefit of the old school way - training and professional development.
While e-learning holds great promise, almost all of us have had the vast majority of our educational, development and collaboration experiences in the “real world.”
And unless and until there is some radical re-ordering of parenting and elementary school norms, this will always remain so.
As for reaching “hearts and minds,” working out of one’s spare bedroom, or from the kitchen table is convenient and all, there are few experiences of “true aliveness” like working in-person with colleagues you respect, toward accomplishing missions and objectives of value and high ideals.
Old School Negatives. It is 2012, folks, and markets and competitive conditions in our brave new world move far faster than the traditional, “one roof”, employer - employee organization dynamic.
Combine this with the fact that it is getting increasingly difficult to attract and retain the best and most creative self-starters to traditional corporate environments, and it is easy for organizations to devolve to both personnel mediocrity and a mismatch between what the market dictates and what the employee rolls reflect.
New School Positives. Sites like LinkedIn, Rent-a-Coder, Craigslist, and dozens of other have made it cheap and easy to find and transact with talent with the skill sets an organization needs as it needs it.
And while cynical, it is also true that it is easier to downsize a virtual workforce than one where folks are eating, laughing, and co-habiting together daily.
New School Negatives. This new school advantage is of course also its biggest weakness – the detachment of virtual workers makes it almost impossible to create that inspired workplace which visionary leaders like Tony Hsieh, Richard Branson and Sam Walton hold as the ONLY sustainable competitive advantage in modern business.
So what to do? There are of course no hard and fast rules, but a good shortcut is to deeply ask – “What is absolutely critical, absolutely core to my business and what is merely tactical?
That which is core, go old school.
Everything else, go new school and outsource it to that always-on, increasingly omniscient big data cloud of global talent and run your business to modern daylight!
Written by Jay Turo on Monday, August 27, 2012
Debt crises in Europe.
Medicare, education, and deficit crises at home.
Middle East crises for as far as the eye can see...
Things seem pretty bleak out there, don’t they?
And isn’t the tone of our civil discourse so polarized that not only do we have tough problems, but doesn’t it feel as if our ability to proactively address them is less than it has ever been?
But maybe we have met the enemy and it really is us.
Maybe we have let our “it bleeds, it leads” media - the drumbeat of negativity that we are subjected to on a daily basis - play havoc with our psyches.
Maybe we are putting so much emotional weight and heft into the things that are bad, the things that can go wrong, that it is crowding out the things that are positive, the things that can and are going so very right.
Maybe the statistical odds are actually overwhelmingly in favor of everything just getting better.
For all of us, our children, our grandchildren.
As in more prosperity, better education, more safety from premature death and disease, and yes even more happiness.
Maybe when we pull our heads up and look around, what we will see is that what we are really living in is a golden age of technology, of prosperity.
And of possibility.
Maybe optimism - as author Matt Ridley describes it – is really the intelligent, intellectual choice.
Peter Diamandis in his outstanding book “Abundance” talks about the “rising 3 billion” - how between now and 2020 the number of people connected to the global Internet and productivity grid will rise from its current 2 billion to 5 billion.
And that as it does as opposed to this creating crisis, how it will lead to the greatest economic boom in the history of the world.
A boom driven by innovation, by technologies with us now in dynamic new fields like cloud computing, robotics, 3D printing, synthetic biology, digital medicine, nanomaterials, and artificial intelligence.
So now this is exciting stuff, and I feel personally blessed that my professional life revolves around a company like Growthink with its so inspirational mission of helping entrepreneurs succeed.
As, of course, it will be the entrepreneurs – working at companies large and small and ones yet to be even dreamed and conceived - that will drive and create this new boom and these new innovations.
But even more excitingly, is the age that we are moving into is one driven by a power greater than that of technology and entrepreneurship.
And that will be one driven by the power of comparison.
As has been happening for the past 30 years, those individuals and locales and states and countries that “get it” - and let technology in, let entrepreneurship in, let freedom in, well they will continue to be the ones that get ahead and get richer and richer and dare I say happier and happier.
And those that don’t get, well they will fall further behind.
And for the first time in human history, there are now billions of people the world around with this power of comparison - of trial and error, of split testing, of modeling and mimicking best practices.
The power of information and intelligence and an entrepreneurial spirit and an empowerment to do something about it.
And because of this power, yes the statistical odds are overwhelmingly in favor of things just getting far better than any of us even dare to dream.
Written by Jay Turo on Monday, August 6, 2012
The “Great Recession” has cost America over 8 million jobs.
The entire fabric of the our "way of life" - from tax receipts to pay for government social programs, schools, and national defense - to the sense that the lives of our children will be better than ours is dependent on a society that creates LOTS of good jobs for those that want to work and are willing to work hard.
Let’s be more stark and look at two places in the world that simply don’t create very many jobs of any type - sub-Saharan Africa and the Middle East.
Even a cursory look at the deep and tragic social problems of these regions lead to two conclusions - 1) the incredibly wasted potential of literally hundreds of millions of people because there is so little to do and 2) the source of the attractiveness of violent ideologies to young people when there is no hope for them to “earn their own bread.”
Now, thank God America’s problems are nowhere even near the magnitude of those in these fortune-starved places, but the connection between how we live and our society’s ability to create jobs is such a fundamental and moral issue that it should never be made into any kind of political football.
And more to the point, as Americans we don't just want “a” job.
We want a GOOD job, or one that:
1. Allows for a reasonably “worry-free” meeting of the base, human needs - food, water, shelter, and clothing.
2. Provides security from threats to health and violence (i.e. making enough money to live in a safe neighborhood).
3. Is part and parcel of one’s overall life mission, whereby the successful performance of it is "self-actualizing," and generates self-respect, a sense of belonging and community, the inherent satisfaction of the work itself, and the satisfaction of contribution to a cause larger than ourselves.
So Where Do These Good Jobs Come From?
Well, they obviously don’t come from government.
Perhaps less obviously, they also don’t come from Fortune 500 America – as big companies on average shed more jobs than they create in time of both prosperity and recession.
No, according to multiple studies of U.S. Economic Census Data and from the Kauffman Foundation nearly all net new job creation in the U.S. economy comes from new (startups) and young (one to five years old) companies.
By way of perspective, in the last “good jobs year” of 2007, the U.S economy created 12 million new jobs.
Of these, startups and young companies created 8 million of them, or almost the exact number of jobs that have been lost in the current recession.
• Since 1977, without startup companies, net job creation for the American economy would be negative (i.e. more job would have been LOST than created) in all but a handful of years.
• Young firms - companies between 1 and 5 years old - over the past 30 years have accounted for the lion's share (more than 2/3) of all net job creation.
This is because while startups create a lot of jobs, the high failure rate of new businesses - less than 50% of them make it to age five - causes them to shed a lot of jobs too.
In fact, companies between one and five years old create on average 4 jobs per year each.
And it goes deeper than that.
My experience of over 20 years in business has taught me that there is far greater likelihood of a good job - as defined above - being at a startup or a dynamic young company versus being at a larger and normally more bureaucratic organization.
And it should be self-evident that companies that are creating jobs are one that are growing.
And yes folks, it is growth companies and growth companies alone that drive equity values and lift stock markets.
So, let's back them governmentally - not with handouts but how about for starters with just simple and predictable tax and regulatory policy.
And let's back them culturally - by holding up the entrepreneur and business owner for what he or she really is - a modern day, real-life action hero.
And from these bases of understanding and agreement, yes we can all build something great together.
Written by Jay Turo on Monday, July 30, 2012
What most frustrates angel investors is the “needle in the haystack” nature of picking winners.
The frustration is trebled because the “traditional” investing options these days are so profoundly unattractive.
The U.S. public stock market long-term woes would be comical if they weren’t so tragic.
We are now well-beyond 13 long years of ZERO public market returns, with major indices (Dow, S & P, and NASDAQ) trading, on an inflation adjusted basis, much lower than they were in July 1999.
As for that other traditional pillar for the individual investor – residential real estate – its woes are similarly deep.
While prices have seen a moderate recovery this year, since 2007 residential real estate investments have largely reverted back to being long-term depreciating - and not appreciating - assets.
Most Americans, in fact, have gotten so discouraged by both markets’ performances and the media’s incessant “end is near” blaring that they have simply taken the “un-approach” to investing.
They just leave their money in cash – mostly in zero or close to zero interest checking and savings accounts.
Now, what is most perplexing and intriguing about this investment depression it that it has coincided with what has unquestionably been the greatest period in history for technology innovation and human progress.
So how do we square these – a period of historically unprecedented innovation tied to one of historically abysmal investing return?
And more importantly for the pragmatists, how do we profit from it?
To the first question, I would point to three main factors – continued payback for the 80’s and 90’s, globalization, and governmental intervention.
For the U.S. public markets at least, the last 13 years have represented a “reset” of values that had gotten way ahead of themselves in the 80’s and 90’s.
Remember, from August 1982 to July 1999, the Dow Jones Industrial Average went from 777 to 11,031, and the NASDAQ from 159 to 2,685.
Just too much too fast, and after this 16-year great bull market we have now had a 13 year pause.
As for globalization, in this context it is the idea that wealth growth in this period has not so much been paused as it has simply moved from the U.S. and the “West” to the “BIC” – Brazil, India, and China and their brethren.
To the degree that this is true, my view is that it is a short-term “ripple” that is clouding the longer-term reality that all of this great, new global wealth will soon find its way back to the U.S. in the form of increasing exports of American goods and services (especially services).
Thirdly, and perhaps most distressingly, has been the “double whammy” of U.S. governmental intervention in the markets.
First, by “crowding out” private capital with massive, structural budget deficits.
And more subtly but far more insidiously, by “uncertainty signaling” regarding tax and regulatory policy which has slowed entrepreneurs from taking the kind of assertive, forward action and risks that they could and would if they felt more comfortable regarding the rules of the game.
So what to do?
Well, if history has taught us anything, it has taught us that in the long run innovation always wins.
And, in spite of its challenges, the U.S. economy and society still produce by far the most and the best innovators in the world.
Find and back these innovators and you will be just fine – BIC, government, and the ups and downs of the markets notwithstanding.
As for who these innovators are? Just keep it simple.
As opposed to thinking of them as technologists, just think of them as good business people.
Peter Drucker defined them best many years ago simply as “Effective Executives.”
They are those that:
1. Ask, “What needs to be done?”
2. Ask, “What is right for the enterprise?” (as opposed to an individual or a specific stakeholder)
3. That develop action plans.
4. That take responsibility for decisions.
5. That take responsibility for communication.
6. That focus on opportunities rather than problems.
7. That run productive meetings.
8. And that think and say “we” rather than “I”
Find these effective executives in whatever line of business they may be in and BACK THEM.
Everything else is just noise.
Written by Jay Turo on Monday, July 23, 2012
What do the most dynamic 21st Century entrepreneurial companies have in common? Well, for starters they a) pursue global Markets b) place company culture above all else and c) They embrace the Black Swan within and without.
They Pursue Global Markets. Peter Diamandis, in his great book “Abundance, The Future is Better than You Think” talks about the emerging world of “9 billion people with clean water, nutritious food, affordable housing, personalized housing, top-tier medical care, and nonpolluting, ubiquitous energy.”
Drowned out by the doom and gloom talk of Euro-crisis, LIBOR and Mitt Romney’s tax returns, it is THIS story that is and will be the dominant one of our 21st Centrury.
Try these statistics on for size, from 1999 to today Asia’s share of the world’s Initial Public Offerings grew from 12% to 66%. In that same time frame, United States IPO volume declined 75% in real terms and now accounts for less than 11% of the global total.
And with their capital and confidence, China and India are stretching their wings. Since 2005, they have been the two leading investors in Africa, investing $31 billion and $16 billion on the continent, respectively.
Why? Well, McKinsey estimates that consumer spending in Africa will double, to $1.8 trillion, by 2020, equivalent to bringing a whole new market the size of Brazil online.
China. India. Brazil. Africa. This is where the growth action is, and while the first reaction of Americans is to feel as if we’re being left out of the game, the RIGHT reaction should be WOW.
These are fantastic new markets for U.S. goods and services, especially services, and they are expanding in aggregate at a rate that even 10% U.S. domestic GNP growth couldn’t touch.
Action Point: Core to every strategic session for any company of ambition should include these simple questions:
• What is your China strategy? Your India strategy?
• How easy / possible is it for global customers to buy your product – to purchase your service?
• How can they find you? How do you market to them?
• How / must your business model evolve to leverage these new opportunities?
They Place Culture Above All Else. Modern business, shaped by technology, is increasingly diverging to two nodes – on the one hand to great size quickly (see Google, Facebook, eBay, Twitter, et al.) and on the other hand, to corporations of one, the so-called Free Agent Nation.
The tools of collaboration and connectivity - mobile always-on Internet, cloud productivity applications like Google Apps, Basecamp, Salesforce and Skype - are so good that the natural devolution is to a BREAKUP of the corporate form and to everyone working for themselves, by themselves.
Now except for the very fortunate few (see Google et al. above), almost everyone else is left with the challenge of how to get to scale and once there how to maintain it.
This is HARD. In a world where ideas and technologies and business models and even intellectual property (sad but true) can be copied and undercut worldwide at the speed of a mouse click, what can any company really hold onto?
The answer is company culture. There is no one size fits all answer as to what the “right” corporate culture is. Successful cultures are as disparate as General Electric’s famously formulaic one, to Zappos’, Virgin’s, and Mind Valley’s irreverent, almost carefree approaches.
But a few constants remain. A strong results and metrics-focused approach. A vigilant commitment to ethics and integrity. And an environment that encourages and demands learning and constant improvement of people and processes.
The great thing is that via the Internet we CAN copy the principles of the best of them - Zappos’ and Mind Valley’s and scores of others are online for all to see. While the principles of course are NOT the culture itself (wouldn’t it be nice if it was that easy?) they ARE signposts as to what is possible.
They Embrace the Black Swan Both Within and Without. At the core of modern entrepreneurship are the sometimes seemingly mystical precepts of The Black Swan.
The concept of The Black Swan was popularized by the great Lebanese thinker and writer Nicholas Taleb in his bestseller of the same name. He describes it best:
"What we call here a Black Swan is an event with the following three attributes. First, it is an outlier, as it lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility. Second, it carries an extreme impact. Third, in spite of its outlier status, human nature makes us concoct explanations for its occurrence after the fact, making it explainable and predictable."
Taleb continues, "I stop and summarize the triplet: rarity, extreme impact, and retrospective (though not prospective) predictability. A small number of Black Swans explain almost everything in our world, from the success of ideas and religions, to the dynamics of historical events, to elements of our own personal lives."
So from a business perspective, how can we make the Black Swan work for, and not against, us?
Well, two ideas:
1) Bet on the Unexpected. Check your ego firmly at the door when evaluating business models. Accept that you (and everyone) for that matter KNOWS NOTHING about what the future will hold other than the fact that we don't know what the future will hold.
That is philosophy - here is money-making: The Black Swan teaches us that the big outlier events - the 10 to 1 shots and beyond – will always be UNDER – priced in the marketplace. Bet on them.
2) Allow Serendipity To Do Its Work. Startups intuitively get the idea of creating new business models as part of their mission. But this lightness disappears quickly.
The Black Swan teaches us that what we have done to date, what has worked to date, is probably NOT what we will be doing, what will be working in the future.
And where does The Black Swan point us to find the wisdom as to what to do? Well, as much from outside the formal strategic planning process as from within.
As Taleb says - from conferences, from parties. From chance encounters. From being open to ideas, people and things outside of the normal box.
Incorporate these Black Swan elements into a dynamic corporate culture, cultivate and ACT upon the global view, and let the magic happen.
Written by Jay Turo on Monday, July 16, 2012
It is not hyperbole to define a successful organization as one that finds the balance between a) making the right changes at the right time and b) having the discipline to “keep on keeping on” and just doing more of what is working.
Note well that b) is particularly hard to maintain when the tasks and activities that ARE working become repetitive and lack in excitement and drama.
So how does an organization find this balance - between thinking laterally and creatively and just keeping their heads down and plowing forward?
Well, luckily in the past few years a large and impressive business literature has sprung up that codifies best practices of how to balance this need to incorporate change in an organization with that to maintain doing “more of the good same.”
This thinking can best be summarized by the phrase “immersion plus spaced repetition” and goes like this:
1. Everything, of course, begins with ideas, and the best, business ones normally arise from a series of individually and organizationally introspective strategic planning and goal-setting sessions that clarify objectives and the obstacles standing in the way of their accomplishment.
This immersive process - done at least annually but at organizations with ambition quarterly - both defines what needs to be done and inspires all of the participants to take on the hard and often painful work of getting it done.
The latter point here cannot be underestimated – Thomas Edison famously said that “genius was 99% perspiration and 1% inspiration” but that 1% “spark” is uber-critical in propelling an organization through the first threshold of change.
2. But, as anyone that attended an exciting or invigorating conference or strategic planning session can attest (and as I am sure Mr. Edison reflected on often during long nights at the lab), inspiration fades over time.
Even worse, when the inspiration is not followed through on, cynicism can set in and actually leave an organization worse off that if the planning sessions were never done in the first place!
So how to avoid this distressing fate?
3. Well, by keeping the ideas, goals, and objectives of the planning session alive through their regular review and adjustment.
Think of it this way - if a well-run strategic planning session is the essence of good leadership, then well-run, spaced and repetitive goals and objectives reviews are the essence of good management.
Great managers check in with their teams as often as daily – if only for 5 or 10 minutes – to review the day’s objectives and to keep the shorter term work flow aligned with the longer term planning and mission objectives.
The old adage that the only way to eat an elephant is one bite at a time is never more true than when is comes to these spaced and repetitive management check-ins. When done right, they measure, acknowledge, and reward incremental progress and prevent the desire for the perfect from getting in the way of the doable and the done.
Now, at least annually and preferably quarterly, the entire organization needs to reconvene to review actual progress versus stated goals, to assess what worked and what got off track, and then to refine and define updated goals and objectives.
And after this next round of strategic planning sessions, what is to be done?
Well, the spaced and repetitive management check-ins begin anew. Wood is chopped, water is carried.
Following this simple but disciplined formula, over time great ideas become great realities, businesses are built, and legacies and fortunes are made.
And for investors, far more than technology these “above the line” leadership and management disciplines that separate the well-run companies to back from the haphazardly ones to avoid.
So what are you waiting for?
Written by Jay Turo on Monday, July 9, 2012
The founders of wildly successful companies - with their world-changing impacts and their awe inspiring wealth creation - receive much well earned praise and financial rewards for turning their great entrepreneurial visions into reality.
But what about those with 1-2 degrees of separation who also benefit immensely?
Folks like Andy Bechtolsheim - who invested $100,000 into Google in September 1998, a position now worth more than $1.7 billion.
Or a Mark Cuban, who rode the Internet wave perfectly, to the tune of selling Broadcast.com to Yahoo for $5.9 billion in Yahoo stock. Even better, he had the additional good luck to sell nearly all of that stock near the peak of the Internet bubble.
For that matter, how about Mikhail Prokhorov, now with a fortune estimated at over $18 billion, and other rags to riches stories like his driven by having the right friends at the right time?
Prokhorov as a young man had as his sponsor Deputy Prime Minister of Russia Vladimir Potanin - just as many of Russia’s largest state-owned enterprises were being privatized.
Prokhorov parlayed this relationship into a controlling interest in the huge Russian nickel business before it became a stand-alone publicly traded company.
And he - like Mark Cuban - had the additional boon of turning his equity stake into cash at the absolute right moment (and the circumstances of which are high comedy to say the least).
These stories of great luck and fortune are timelessly inspirational for entrepreneurs, investors, and dreamers everywhere.
At the same time, they are frustratingly vexing and opaque to turn from descriptive narrative into prescriptive guide.
I.E. – if it were only so simple doing “A,” and then having “B” magically appear.
But of course luck and good fortune - as a whole lot of business philosophers from Nassim Taleb to Malcolm Gladwell to Joshua Ramo have opined - just doesn’t work that way.
There is, however, a LOT that we all can and must do to “let luck in.” Author and speaker Stephen Shapiro offers three great ideas to do so:
1. Grasp the Critical Difference Between the Probability of ANY Good Thing, versus a SPECIFIC good thing, Happening. To illustrate, Shapiro puts a twist on the famous birthday example:
“…if you ask the question, “How many people do you need in a room to have a 50 percent chance that two people will have the same birthday?” Some people immediately assume it is half of 367, or roughly 184. While that is a logical guess, it is actually incorrect. In fact, you would only need 23 people. Shocking? Try it some time and see what happens. With just 40 people you will have a nearly 90 percent chance that two individuals will have the same birthday.
Now I’d like you to consider how many people you would need in a room to have a 50 percent chance that two people share a particular birthday? For example, I was born on April 25. How many people would I need to have in a room to have a 50 percent chance that there is another person with my exact birthday? Surprisingly, the number now increases to over 600.”
The business point?
While specific goals and objectives are great, be careful to not limit the various permutations that a business journey might take to arrive at a desirous destination.
2. Understand the Difference between The Value of Planning, and being Wed to “A Plan.” Shapiro quotes General and Future President Dwight Eisenhower’s poignant quote that "In preparing for battle I have always found that plans are useless, but planning is indispensable."
3. The Great Ones Above All Else, Act. All of the stories of business success are many things, but above all else they are tales of ACTION.
Of writing the code. Of making the investment. Of going to the conference. Of talking to that beautiful stranger.
Now thinking and being like this does not guarantee that you will become a famous General, or a wildly successful entrepreneur or investor.
But the opposite is assured - that without cultivating the mindsets of boldness, of action, of positive expectation, one runs the serious risk of living - as a man of famous great action once so famously said - “with those cold and timid souls who know neither victory nor defeat.”
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