Archive for the ‘Business Plan Review’ Category

On Being an Entrepreneur

Sunday, June 13th, 2010

Over the years I’ve done several entrepreneurship programs for universities and colleges. I find it very interesting the academic perspective on entrepreneurship. Often they are missing key elements. It’s one thing to read case studies and talk about serial entrepreneurs, but it is quite another to actually go out and do it. Here are my top ten things I’ve noticed and experienced being a serial entrepreneur for almost 50 years (my first gig was selling donuts door-to-door in my neighborhood when I was 7.)

1) Entrepreneurs are more concerned with how the business works than working in the business. They understand the processes and find employees to carry them out.

2) There’s a big difference between being a business owner and being self empolyeed. Those who have worked for others and start a business based on what they love to do often get trapped in a well paying “job” they’ve created for themselves. Over the years I’ve even found myself trapped this way. The test of a business vs self employement is if you went away for a week or a month, would your business be bigger and still healthy when you came back. The second test is whether you have a driving need to get a paycheck every other week. The security of a paycheck isn’t what drives entrepreneurs.

3) Entrepreneurs aren’t concerned with what other people think about their plans. They may get 70% of the planning done according to textbook lessons, but the remaining 30% is sheer gut reaction that this is going to work.

4) They are ACTION oriented versus being overly concerned with defining every possible contingency. It’s very common for those with corporate, academic, or government experience to become trapped in paralysis by analysis. They lose the opportunity because they took too long to launch and someone else beat them to it.

5) Entrepeneurs aren’t afraid to fail. In fact, failing fast is one of the main objectives. They get most of it right and then fix what isn’t working as quickly as possible. They recognize that you can’t wait around to get everything right. Get it mostly right and pull the trigger. They know what the KPI (Key Performance Indicators) are for their business and what’s necessary for them to be successful. They have defined success in advance and what the indicators are for success.

6) They know that success isn’t an overnight, flash-in-the-pan. Sure it’s possible to hit one out of the park occasionally, but most businesses require steady improvement. They know what the milestones are and the time associated to get there is.

7) There are no 8-5 hours. Entrepreneurs are focused and all in. There is an adrenaline rush with working 16 - 18 hr days during start-up and growth. It becomes much more manageable when the initial rollout has taken place. This is alot like a Product Launch, but on a much grander scale. This is what drives the serial entrepreneur, the excitement and rush of the rollout. Hard work and long hours define the entrepreneur.

8) They recognize that the success of the venture depends on having people smarter than themselves running the key elements of the team. They concentrate on orchestration and coaching while they keep an eye on meeting the key objectives.

9) They recognize there are going to be set-backs and disappointments along the way, but it doesn’t matter. It’s part of the process. They also know what will be the deal killers and avoid those at all costs.

10) Most of all, they are persistent and tenacious. Perseverance and tenacity combined with gut instinct will win out almost every time. Even well funded, more experienced competitors will lose out when dealing with pit bull determination.

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Beginning the Planning Process - FOCUS

Wednesday, January 13th, 2010

Planning and goal setting begins with focus. Unless you have a laser guided vision of where you want to end up, you’ll never get there. It’s not all that important to know the details of how you’re going to get there. It is important to know where you’re going.

When I talk about focus, I’m concerned with the areas that are most important to us. This includes our customers, markets, distribution channels, technology, and people. If you try and plan without considering all these related areas, you’re bound to end up frustrated with a set of poor results. This leads me to one of the biggest goalsetting mistakes common to all most all of us.

It’s common to over estimate our goals. Be bold, but be realistic. You need some kind of reference point and a basis for making your assumptions. You can’t just say, “we’re gong to be a $20 million company by the end of 2010 when last year’s sales were only $500,000 and you have 2 employees. There are exceptions to this, but in general, being realistic is a big part.

Where I see the big focus challenge (myself included) is in being spread too thin over too many different areas. A good friend and mentor of mine recently told me, in his “down home” style, “Remember who brung ya to the dance.” By this he was telling me to focus on the customers, markets, etc that have made our success in the past possible. It’s far easier to expand business with someone you’re already doing business with than to abandon them and go running for the next biggest and greatest thing.

While we’re on the subject of focus, my wise friend also counseled me to stop “swinging for the fences all the time.” He was advising me to spend more of my time on work we would be certain of attaining and not spend too much time on speculative monster accounts. It’s ok to have some of that in your mix, but the stability of your company and your sales lies in diversification and with a customer base that appreciates what you do for them on a daily basis.

It’s much easier to please small to medium accounts than it is to cater to the whims of that big elephant. If you displease them or fail to deliver, you’re in big trouble when they leave. You aren’t nearly as exposed with more smaller accounts.

Look closely at all the key areas necessary to grow your business. Really drill down and look at how much capacity for growth you really have. This means knowing exactly who is going to be doing the work or how you’re going to pay for it. All of us are working thin after the last year. If you really want to grow, but can’t support that growth, there’s no point in driving forward.

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Planning for 2010 and Beyond

Saturday, January 2nd, 2010

The first week of the New Year is always a special time for me. it’s when I sit down and try to objectively look at what happened in the previous year and plan for the coming year. For almost everyone 2009 was a train wreck of a year. The wheels came off and most companies are lucky to still be around. So, looking back for me was mostly painful. The only thing we can do is suck it up and keep moving forward. There aren’t going to be any quick fixes and fast turnarounds.

Planning is going to be the theme for January. Over the next month I’ll be blogging about how to set the course for your 2010 Business Plan so you can be as profitable and productive as possible. Here are some beginning thoughts to help you get started with your planning.

1) Focus, focus, focus. When I look back on ‘09, the single biggest thing I see was the disorganized, random, chaos of reaction. When things don’t go as planned, we react. Too often that reaction is unfocused and relevant to the event at hand. Our actions don’t fit into a bigger plan, so we aren’t nearly as efficient as we’d like to be. It is more or less like sticking your finger in the dike to stop the leak. It may fix the immediate, but it does nothing to address the bigger problem of why the dam is leaking in the first place.

Focus means selecting a course of action and sticking with it. You don’t have to get it all right, but you do need to concentrate on the desired outcome and fix on that. We can make minor corrections along the way, but don’t be tempted to make radical changes in midcourse.

2) Know what the outcome of your efforts is supposed to look like. Are you trying to add new customers? Increase sales? Increase frequency of sales? All of the above? Clearly define what your expected outcome is so you’ll know if you are on track or off course. Have Plan B, C, and D in place if you’re ahead of schedule, behind schedule, or on schedule. With alternatives in place, and a clear idea of the result you’re looking for, it makes it much easier to stay on target for your goals. This will help you avoid wholesale course direction changes that can stall your momentum and dilute your efforts. And it can help you from wasting time on nonproductive diversions.

3) Understand the difference between planning and action. The plan is the framework to achieve your results. It is strategic and should result in increased stability and soundness. The tactics or actions are how you’re going to get there. We tend to focus on tactics at the expense of strategy.

4) From Steven Covey’s Seven Habits of Highly Effective Leaders, “Begin with the End in Mind.” Define your ending point or year end goal for 2010 and begin piecing the parts together.

Over the next month, I’ll be concentrating on the planning process so by Feburary 1st, you’ll have a workable plan in place for you.

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