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A (Business) Prayer for the New Year

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Recently Dr. Jeff Cornwall of Belmont University offered the invocation at his school's MBA graduation ceremony. He prayed some powerful words that are not just for those graduates, but for all business leaders and entrepreneurs to direct their focused attention and sincere efforts. Here's an excerpt:

"We pray that they understand that their work on earth should never be just a career, but a true vocation that connects their faith to all they do in the work. We pray that they remember that true integrity is to find God helping us to live as He intended us to live in all that we do: in our family, in our community, and in our work."

Follow this link (http://www.drjeffcornwall.com/2008/12/a-prayer-for-the-new-year.html) to read the rest of the prayer. Enjoy!

Empowering Champions,
Paul Wilson, Jr.

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Small Business Workshop Survey

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I would like to invite to participate in a survey that will help us to determine if our new supply chain workshops are something that would appeal to small business owners and employees.

Click on this link for the survey.


Background Info:
Based on the consulting work that I've done over the past few years with corporations and small businesses, I realize a major "understanding gap" exists between corporations' procurement needs and how small businesses position their products and services to supply them. This realization has led me to develop a series of workshops that give small businesses a "behind-the-scenes" peek at how corporations operate their purchasing departments, so they can be more successful in obtaining contracts.

These workshops will equip small businesses to more accurately identify a corporation's specific value drivers, purchasing needs, and performance requirements, so they can competitively position their products and services to provide the most value, i.e. get contracts. Topics that I intend to cover include:
  • Supply chain operations
  • RFP/Bid process
  • Sales strategies
  • Communication techniques
  • Diversity certifications
  • Tier 2
Thank you in advance for taking the time to participate in our short survey. We value your feedback. I look forward to engaging with you soon.

Empowering Champions,

Paul Wilson, Jr.

Click on this link for the survey.

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A Bridge to Entrepreneurship

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Intrapreneurship is a positive pathway to entrepreneurship

Many people aspire to be entrepreneurs, but are not sure they have what it takes to become successful. A great place to test and develop their skills is in their current jobs, using intrapreneurship as the pathway.

BNET has a great feature section on their web site called, "Unleashing Your Inner Intrapreneur." This section contains multiple articles with some key pointers on how you can become a successful intrapreneur.

One of their resources is this video that provides some effective tips on how you can begin to pursue your entrepreneurial dreams within your current job today:





If you are currently working for someone else's company, don't give up on your dream of full-time business ownership just yet. Instead, start acquiring your entrepreneurial experience right where you are. I look forward to seeing you on the other side.

Empowering Champions,
Paul Wilson, Jr.

Resources:



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Be Persistent Without Being a Pest - Part 2

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...continued from Part 1

It matters what you say AND how you say it

There is a fine line between being viewed by your customers as pest-like versus persistent. The key is effectively managing your customer interactions. In Part 1 I stressed the importance of the fact that the content of your customer communications must be focused on the tangible value that your products/services can deliver to your customers. Here in Part 2 I will focus on how to effectively communicate that value to customers.

Some statistics say that it takes a minimum of 8 interactions for a customer sale to be generated. So, one of the keys to effective customer communications is not trying to hit a homerun with every conversation or interaction. This can be hard for many entrepreneurs to buy into, because sometimes it seems like you staying in business is contingent upon that very next sale. I know how that feels, because I've been there. However, this is one of the most destructive mindsets that you can have as an entrepreneur (or employee), because it can drive short-term thinking, causing some to engage in unethical business practices just to get a sale.

Like with any relationship in life, it takes time, energy, and intentionality to build a healthy one. As it relates to effectively building long-term, mutually prosperous relationships with customers, your thought should be that every interaction that you have with customers is positioning you for the next interaction with them.
Tips for Interactions

Here's some ideas for how to engage in successful customer interactions in order to grow healthy, profitable relationships.
  1. Plan your contact intervals: Develop a 6 month schedule for when and how you will contact each key customer prospect. Strategically plan to have at least 6 to 8 interactions within this timeframe. Utilize various forms of communication including email, phone, in-person, and other tools listed below.

  2. Plan your interactions: Be very intentional about what you want to communicate with each type of interaction. Include the appropriate content with the right communication tools. Especially during the initial interactions, ask a lot of questions, so that you can spend more time listening than talking. This will help you mine key nuggets of information, such as problems, issues, or challenges they are experiencing that you can use for #3.

  3. Link previous contacts/interactions together: Remember, each contact should build for the next one. With each interaction, use creative ways to remind your customer the subject matter of your previous contact and how what you provide relates specifically to their needs or desires. You are basically authoring a story about your company they they are experiencing over a long period of time versus all at once. Make sure it's a good story!

  4. Focus on VALUE!: Don't waste your customer's time trying to impress them with your marketing materials (they can read your web site or brochure for that). Use creative ways to communicate the tangible benefits they will get from your product or service (remember Part 1?). Also, consider including the negative impact they might experience by not using your product or service.
Tools to Demonstrate Value

One key to effectively demonstrating your value to customers, is to position yourself as the expert in your area. You can do this by displaying your capabilities, experience, and expertise in ways that increase their knowledge and awareness. As part of your planned customer interactions, I suggest incorporating some of the following tools at various intervals:
  • Customer Satisfaction Surveys
  • Customer Testimonials
  • Newsletter
  • Blog
  • Case Studies
  • White Papers
  • Podcast
  • Book
  • Freelance writing for magazines and industry trade publications
  • Press releases
  • Awards
A lot of this stuff is Marketing 101, but many entrepreneurs either don't utilize these tools or they don't use them in the most effective ways. Just like in other areas of our lives, we often know what to do, but we still don't do it.

Acquiring new corporate customers requires having the right strategic approach that clearly and consistently demonstrates your value. Hope for quick customer decisions, but plan as if they will take a long time. Persist the right way so that you don't become a "sales-pest" that they want to exterminate.

Empowering Champions,
Paul Wilson, Jr.

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Be Persistent Without Being a Pest - Part 1

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Beware of pest-like behavior

Successful business owners understand that the DNA of their personality must contain the 3P's of Entrepreneurship: passion, perseverance, and persistence. Unfortunately, many entrepreneurs are unbalanced, with passion often overshadowing the other two. And when they are "overly passionate" about what they do, but without understanding how to effectively channel that passion or have underdeveloped interpersonal communication skills, they will come across as overbearing, tactless, and even desperate.


In essence they have created a combustible mix of annoyance that causes a customer's "sales-pest alert" to be activated. When this happens, customers become turned off and alienated very quickly. It can then become an extremely difficult challenge to reverse a customer's perception, partly because the experience has confirmed their negative preconceived notions of "typical" salespeople.

For small businesses who mainly target large corporations, there exists an art and a science to securing and growing healthy, prosperous customer relationships. Although, it often takes a long time to get through some of your prospects' doors of opportunity, you have to be able to knock on those doors with a velvet hammer.

I am going to break up this topic of persistent, "non-pest like" customer communications into 2 parts. Part 1 will cover what to communicate and Part 2 will cover how to communicate it. So, let's look at what the content of your interactions should be with prospective corporate customers.

Value Drivers for Corporations

As you target different customers, there is a common denominator that they are all looking
for... VALUE! Whether you sell widgets or windmills, if you expect to build a prosperous relationship, your product or service better do one of the following for your customer:
  1. Make money
  2. Save money
  3. Solve a problem that does 1 or 2
  4. Make job easier to do 1 or 2
  5. Provide new learning that help them do 1, 2, 3, or 4
If your product or service doesn't satisfy any of these five, then I would strongly argue that you are not providing value. And in the current economic environment, most corporations are not going to spend money on something that is not providing them some type of tangible value.

Measure your performance to prove your value

One of the keys to demonstrating value in one of these five areas is having performance metrics derived from data collected from your previous customer engagements. The critical importance of selecting the right performance metrics is that they must be: 1) important to your customers, 2) relevant to their goals and 3) demonstrate your past successful performance.

If your customers value cost savings, then having metrics that show how your product/service has saved money for previous customers is crucial. If your customers are focused on service levels, then you need to have metrics that demonstrate your ability to maintain high service levels. If your customer is focused on providing a high level of customer satisfaction, then having metrics that demonstrate how well you keep customers pleased is a non-negotiable.

Unfortunately, for many small businesses that I have dealt with, collecting data used to generate performance metrics is not a business practice that is utilized often enough. Without capturing data, it will be very difficult for you to effectively prove that you can deliver on one or more of these five value drivers.

Before engaging your next prospect, you need to collect and analyze relevant data in order to assess whether or not your product or service would really add tangible value to their operations. Doing your due diligence in this area prior to contacting them will help to ensure that your customer interactions will be time well spent - for you and them. They will definitely appreciate you for that (even if you don't get a sale right away).

Passion is a necessary element for any successful entrepreneur. However, you need to be able to demonstrate controlled passion not just about what you do, but how well you do it. When you are able to clearly prove your tangible value to customers and can effectively communicate that in a consistent, non-intrusive way (see Part 2), you run a much lower chance of being perceived as a pest.

Empowering Champions,
Paul Wilson, Jr.

Make sure to check back for Part 2.

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Decision '08

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Although this is an election year, many people have some crucial personal and professional decisions to make that may have a far more profound direct impact on them than who the next president of the United States will be. Why is that? Because with the typical pace of the government decision making today, if often takes a long time for new policies and laws to directly impact your life. This definitely will be the case with a new administration no matter who wins. On the other hand, the career and business decisions that you make during this season of your life will have an impact much sooner.

Critical decisions that many people are currently wrestling with include: Should I stay in business and weather this economic storm, or should I search for something a little more stable (relatively speaking)? Is this the time to implement my exit strategy and start a new business? Should I change my job/career and do what's really in my heart to do?

Why are the answers to these questions so important now? Even though the country may be sinking into a recession, people and corporations are still going to buy competitively priced, high quality goods and services, and corporations will still need problem-solving, value-adding employees. The main difference in their decision making between now and few years ago is that they are going to be much more selective and value conscious with how they spend and invest their money.

An economic downturn presents a great opportunity to chart a new course, especially for entrepreneurs. One person's problem is another person's chance to provide a needed product or service. One company or industry's challenge could present the perfect opportunity for an entre/intrapreneur to demonstrate their expertise and experience through a new solution that delivers tangible value (see "Just Like Jazz").

Therefore, as you go through your decision making processin this tumultuous and uncertain economic environment, ask yourself: How will you differentiate yourself from your competitors or co-workers? How will you demonstrate value to your customers or employer? How are you going to win when it seems like everyone else is resigned to losing?

Yes, these are challenging times. But, as an ancient Hebrew proverb (hint: from the Bible) states, "If you wait for perfect conditions, you will never get anything done." If you are an entrepreneur or intrapreneur, this is not the time back down, but to branch out and go against the flow. After doing your due diligence, develop your plan, overcome any doubts or fears, step out in faith, and seize your moment to ignite your life. Let your personal "Decision 2008" be one that positions you for positive and prosperous future!

Empowering Champions,
Paul Wilson, Jr.


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Win Like Tiger

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Conquer the sport of business!

I'm a huge sports fan, so I spend a lot of time reading about about sports teams and athletes. I love to read articles and stories about championship teams and players and what helped them to become the best. Much can be gleaned from sports franchises and athletes that relates to winning in business.

Of all the sports that are played in the world, golf is probably the one that is most similar to entrepreneurship (especially businesses that only have a few employees). I say that because every weekend golfers have to compete against dozens of other golfers who are the best at what they do. And unlike sports such as football, basketball, and baseball, in golf there is not a team of people that you can rely on to win the game while you're playing. Even though golfers have coaches, advisors, and assistants, they can't come with them on the course.


When most people think of championship-caliber golfers, the person that usually comes to mind first is arguably the best golfer to ever play the game, Tiger Woods. As we have already seen this year with him winning his first four tournaments, he seems to be constantly getting better (if that's even possible for him). In a story about Tiger written last week, Steve DiMeglio of USAToday.com wrote:

"So how has Woods continued to elevate his game, even after reaching the No. 1 ranking? Fellow athletes, sports analysts, business leaders and others say he's done so by meshing his considerable physical talent with a combination of focus, commitment, strategy and nerve that is unlike anything they've ever seen."

In that same story, the author outlined five key factors that keeps Tiger at the top of his game and consistently in front of his competitors. There are some definite applications to you as an entrepreneur. Here's their list:

  1. The mind game: Never stop learning and don't let anyone out-think you.

  2. Finding motivation: Cultivate an internally-motivated, passionate, relentless, "refuse-to-lose" attitude.

  3. Fit and rested: Take care of your body, because your health is the most important thing that you have.

  4. Confidence to change: Don't be afraid to mess with success, especially when you know you can get better.

  5. A unique talent: Determine the special qualities that you have/need to be the best.
I believe that you if you diligently and consistently apply these principles, just like Tiger you can also get to the top of your profession or industry.

Empowering Champions,
Paul Wilson, Jr.

Resources:

"Five Keys to a Game that Remains on the Upswing" by Steve DiMeglio at USAToday.com
http://www.usatoday.com/sports/golf/pga/2008-03-20-Tiger_N.htm

"The Habit of Winning" by Me

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Online Small Business Summit

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For those of you who would love to go to a small business conference, but don't have the time or the money, here's the perfect solution for you. The Microsoft Small Business Summit is a FREE online conference that will provide powerful advice and valuable secrets to help you start or expand your business. The dates of the summit are March 24th - 27th, 2008. Visit www.sbsummit.com for more information and to register.

This event is not about Microsoft (although I'm sure they will be hocking some of their wares). Over these four days, a diverse group of small business experts will be conducting workshops via the web, providing their expertise and insights in multiple areas including:
  • Sales
  • Marketing
  • Technology
  • Public relations
  • Web advertising
  • Work-life balance
  • Mobility solutions
  • Human resources
  • Financial management
  • Business planning
  • Online security
  • Blogging 
  • And more...

The best part about this whole event is that you can join in from the comfort of your home or office. And did I mention that it's FREE!

Don't miss out on this great opportunity to gain some new insights and perspectives to help you launch or grow your dream.

Empowering Champions,
Paul Wilson, Jr.


Register and view online at www.sbsummit.com.

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Passion for Improvement

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Excitement gets you started, but passion keeps you going.

Is your business as successful as it has the potential to be? Are you as good of a leader as you can be? Are you on track to accomplish all of your 2008 goals? If your answer is "no" to any of these questions, I would ask you the simple question, "why not?"

I know that there could be many reasons (or excuses) as to why you may have answered no. You may have challenges with time, money, focus, help, procrastination, or any of the other typical excuses that are used when it comes to talking about why we haven't done something. Taking into consideration those reasons that are legitimate and the ones that are not, I believe one of the key reasons that you have not yet accomplished some of your goals could be your lack of passion.

You might be reading this and think it foolish of me to write that an entrepreneur or businessperson could lack passion for what they do. I'm not raising the question about your passion for the object of your business affection. I'm raising the question about your passion for your commitment to doing what you do even better.

Reading and listening to the jargon of the business world, I see many words that are often overused and misused. One of the most frequently overused and misused words is passion. Many people think that passion is just having excitement or a strong emotional connection to something. However, having a true passion for something is much bigger than just those two things.

The passion I'm talking about is an intense commitment to see something all the way through to its completion or fulfillment. It is demonstrated through endurance and a willingness to fight for what you believe in. True passion won't let you stop fighting until you accomplish your goal, dream, or vision (read "Fighting for Your Dream").

Passion not only helps you to determine what ideas to say "yes" to, but it also helps you determine what ideas to say "no" to. In business it's easy to find many concepts and ideas about which to get excited. However, not all of those things would you - nor should you - be willing to invest the time, money, and energy to see them through to their completion or fulfillment. For the things that you would say yes to, real passion transfers excitement and emotion into action.

One of the things that passion should help you say yes to is continuous improvement of yourself and your business. Passion for continuous improvement means never being satisfied with what's already been accomplished. It means waking up every day asking yourself the question, "how can I be better today?" It means that "good" is not good enough. It means looking in every nook, corner, and crevice of your business for ideas, fixes or tweaks that will help you to lower your operating costs, upgrade your products, or enhance your services.

While most entrepreneurs probably would agree with me that continuous improvement is important, many haven't yet made the commitment to it (or maybe they think they have even though they haven't). One reason that I say this is because of the failure rate of small businesses. Based on my personal interactions with small businesses, this failure rate is somtimes driven by the owners' unwillingness or slowfulness to improve their products or services. Another factor is that they are too busy working "in" the business to work "on" the business, which would limit them from being able to see their operations from a broader, strategic perspective.

To have an effective continuous improvement effort, entrepreneurs must shift their focus to working on the business. Some key areas that you should focus on include:
  • Product/Service differentiation: Becoming better, faster, or cheaper than your competitors.

  • Customer service: Exceeding customer expectations cost effectively.

  • Marketing: Attracting, capturing, and retaining new customers.

  • Operations: Streamlining your processes and increasing your productivity, allowing you to handle more customers or orders with the same or fewer resources.

  • Decision making process: Data and fact-driven decision making versus subjective, opinionated or anecdotal decision making.

And here's two more areas that are often over looked when it comes to continuous improvement, but should be top priorities as it relates to their critical importance to a business:

  • Employees: Creating an attractive, engaging, fun, challenging, and safe-to-fail work environment.

  • Personal development: Utilizing structured and informal means to facilitate lifelong learning and skills development.

One of the key benefits of having a passion for improvement is that it can spark profitable innovations in your business. Innovation requires that you be dissatisfied with the status quo. So when you have an intense desire to always get better, your creative abilities can released and directed toward those areas in your business that need to be improved or enhanced, producing financially rewarding solutions for you and your customers.

Leaders are learners and there is always something new that you could learn to help you or your business do something better. No matter how successful you or your business becomes, you must always have a passion for continuous improvement.

Empowering Champions,

Paul Wilson, Jr.


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Where's Your Hedgehog?

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Grow or Die! - Part 2

Competing Successfully Requires Growing Effectively

In my previous post, I wrote about the need to grow or else your business could be left behind in this challenging, always changing marketplace. Some of you may have read that and said to yourself that your goal is not to get big. I understand that, because every small business owner doesn't necessarily have a goal or desire to become a "big" business owner. Regardless of whether or not you want to get bigger as a company, you still have to be able to outperform your competition if you plan on being in business for a long time.

One of the keys to outperforming your competition is differentiation. Another way to say differentiation is competitive advantage. Your competitive advantage can be demonstrated in various areas of your business, including product innovation, service quality, marketing, pricing, or operational efficiency. If you are able to effectively leverage the value of your differentiation or competitive advantage with your customers, you will be well on your way to growing a healthy company.

You may be asking how the title of this post relates to differentiation. I recently wrote a post entitled, "Turn a Great Idea into a Great Business", in which I explained how entrepreneurs could incorporate into their businesses best practice principles from the book Good to Great written by Jim Collins. The "Hedgehog Concept", one of the key principles that Collins details in the book, is a powerful model that a small business can use to develop a differentiation strategy. Let's take a closer look at this concept.

"Hedgehog Concept"

As Collins describes it, for a business leader the Hedgehog Concept represents three intersecting, critical decision-making criteria that all current and new strategies, plans, and ideas must satisfy before they are approved or implemented:
  1. What is our company deeply passionate about?
  2. What can our company be the best at doing?
  3. What are our economic drivers, i.e. products or services that will generate consistent cash flow and profits?
So, why is this concept called a "hedgehog?" On pages 90-91 in Good to Great, Collins describes the reasons why he chose this nondescript animal to represent this concept. A key characteristic about a hedgehog is that it only has one response to danger, which is to protect itself by rolling up into a ball with its spikes protruding. In describing how this relates to leaders of "great" companies, he writes:
"[Hedgehogs] simplify a complex world into a single organizing idea, a basic principle or concept that unifies and guides everything. It doesn’t matter how complex the world, a hedgehog reduces all challenges and dilemmas to simple - indeed almost simplistic - hedgehog ideas. For a hedgehog, anything that does not somehow relate to the hedgehog idea holds no relevance... They understand that the essence of profound insight is simplicity... Hedgehogs see what is essential and ignore the rest."
(Collins identifies Albert Einstein and Adam Smith as two examples of hedgehogs, because of their ability to boil down complex concepts into simple yet powerful ideas.)

As it relates to growing your business, the issue is not about what you could do, but what you should do. If you have a current strategy or new idea that only satisfies one or two of these questions, your business model is not balanced. Companies that lack passion, skills, and/or profits might be able to operate like that in the short term, but eventually they will have major problems, because anything that's not balanced will fall over in time.

The criteria for any new strategy, idea or opportunity into which you would invest time, money, or people should be that you can answer all three questions confidently. So, as you think about how to grow your business, I encourage you to spend some quality time wrestling with these questions in order to find your business hedgehog. Then you'll really be ready to grow!

Empowering Champions,
Paul Wilson, Jr.


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Grow or Die!

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Healthy Companies Grow

It is a fact of nature that healthy things grow. As human beings we understand that infants grow into toddlers into children into teens into adults, and so on. We identify the transition from one stage to another as an indicator of growth. In fact, we expect these growth stages to happen. And when they don't happen or are delayed, we suspect something is wrong and we start investigating, whether through our own research or going to a doctor.

Of course for a human to grow, the individual systems that comprise our bodies, such as the skeletal, immune, digestive, and nervous systems, have to function properly. If any one of these systems is out of sync or degenerative, we will be unhealthy and our growth could be stunted or we could die.

Systems are also the foundation of every business, large or small. These systems, which could also be called operating processes and procedures (written or just understood), allow the business to function effectively (accomplish goals and make money) and efficiently (use as few resources as possible). When any of these systems are dysfunctional or non-existent, the business will be unhealthy and eventually could die (i.e. bankruptcy, liquidation, acquisition).

Good but not Growing

While it's great the number of minority owned firms has increased exponentially over the past 20 years, the focus now needs to shift to growing exponentially more healthy businesses. As I reviewed the recent small business growth statistics, I was astounded to see the high percentage of minority owned firms that earn less than $50,000 per year (see table below). Amazingly, 85.9% of black owned, 76.8% of Hispanic owned, 78.5% of Native American owned firms fall below the $50,000 revenue threshold.



Healthy Systems are Required for Healthy Growth

From my years of experience as a small business consultant, it is evident to me that a lot of businesses are running without properly functioning business systems. While many entrepreneurs excel in their craft or specialty, some of the essential systems that need to be in place to operate a healthy business are lacking. Many small business owners, whether by choice or ignorance, are not doing enough to position their business for long-term growth.

Let's take a quick look at some of the essential systems that need to be in place for a business to be healthy and positioned for growth:

  • Strategic Planning - The on-going, ever-evolving process of structuring the business internally and positioning the business externally to take advantage of current and future opportunities. This includes managing your business according to your long-term vision, mission and values.

  • People & Culture - People are the most important asset of any company. How are you creating a culture in your business that values, develops and celebrates people? Whether you have 1 employee or 100, your culture should be inviting and empowering. This also relates to how you engage suppliers, customers and business partners.

  • Products & Services - Utilitize creativity and innovation to keep your products aligned with your customers' desires and expectations. You must be able to offer attractive products/services that agree with what your target customers are willing to pay.

  • Customer Relations - Without customers you don't have a business. It is essential that you have a strategic and tactical approach outlined for acquiring, serving, satisfying, retaining and rewarding your customers.

  • Financial Management - For a small business "cash is king". Strategically manage your finances in order to maintain a strong financial position that meets currents needs and positions your business for future growth.

  • Marketing & Advertising - Your company's brand communicates your value to customers. It becomes the launching pad for growth opportunities. Building a strong brand within your target customer market is crucial to growing your company. If potential customers don't understand the value that you provide, then you won't be in business very long.

  • Technology - Don't use new (or old) technology just for technology's sake. Leverage technology to reduce costs, improve products/service, increase productivity, and enhance customer interactions.

Get a Check-up!

Many people refer to their business as their "baby" because they have grown it from it's infancy. As I mentioned earlier, when the human growth stages aren't happening in our children as expected, we take them to see a doctor. It's interesting that with our children, although we know them better than anyone else we still go to a baby specialist, i.e. doctor, when something is wrong.

It's unfortunate that many entrepreneurs don't do the same with their businesses. Whether out of pride, ignorance or unwillingness to spend the money (invest in their own well-being), they often avoid having a qualified specialist come in and assess their business condition/situation so they can get a prescription for healthy growth.

At some point, every business needs a check-up with a business doctor, because no business - large or small - can stay in a stagnant, unhealthy position for very long. Either you're advancing and growing or declining and dying. And with the way that business and the world operates today, you can't be satisfied with what you have accomplished up until today, because that may not be enough to survive for tomorrow. So, what are you doing to grow your business?

Empowering Champions,
Paul Wilson, Jr.

Resources:
1) Mirror Mirror
2) Suggestions for Small Biz
3) The 7 Irrefutable Rules of Small Business Growth by Steven S. Little


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Turn a Great Idea into a Great Business

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Good is the Enemy of Great


Recently I revisited an excellent book that I had read a few years ago, Good to Great by Jim Collins. When I initially read the book, I viewed it mainly from a corporation's perspective (of course I was working for a corporation at the time). However, now as an entrepreneur when I look at the key principles contained in this book, I realize that the model that Collins discovered of what makes a business great over the long-term applies to small businesses just as much as it does to large corporations.

Collins writes on the first page of the book, "Few people attain great lives, in large part because it is just so easy to settle for a good life." Not only does this truth apply to life, but it also applies to your business. As hard as it is to become a good company, it is that much harder to become a great company.

Greatness in business requires some essential components, including focused visionary leadership, commitment to continuous improvement, flexibility to respond to the changing marketplace, passionate perseverance and consistent execution of your strategy over time.

The statistics that detail the lack of success of small businesses are staggering. The numbers tell us that 95% of all small businesses fail within 5 years. Yet when I look at the marketplace, the reason that number is so high is not due to the lack of great ideas. There's actually an abundance of great ideas in the marketplace. Instead, the reason that most small businesses fail often comes down to the fact that many (some would say most) entrepreneurs lack the willingness or ability to execute essential business principles to turn great ideas into great businesses.

Don't Settle for Good When Your Business Can be Great!

Good to Great contains some incredible nuggets of wisdom that entrepreneurs can use to grow a great business. Let's look at a few of them and how they apply to small businesses...

  1. Level 5 Leadership: According to Jim Collins, this type of leadership, which by the way is not common, is defined by those who "build enduring greatness through a paradoxical blend of personal humility and professional will." This type of entrepreneur is more concerned with building a great business rather than just building a big bank account (read my post "Mission-Driven Entrepreneur"). Besides, one of the benefits of building a great business that gets sustained results over a long period of time is reaping the financial rewards that come along with it.

  2. The Hedgehog Concept: A common fallacy embraced by many aspiring (and some current) entrepreneurs is that you can grow a successful business based simply around your passion. Unfortunately, this idea is only partially true. The Hedgehog Concept says that for a business idea/model to be successful, it must be built around the intersection and close-knit integration of three critical components: 1) Something you are deeply passionate about, 2) Something you can be the best at, 3) and Something customers are willing to pay for. This is essentially your business "sweet spot". If you are missing one of more of these components, you will be hard pressed to build an enduring, successful business. Ask yourself, "Am I trying to develop a hobby, operate a charity, or build a business?"

  3. A Culture of Discipline: One of the reasons that many people, including myself, have spurned corporations for small businesses is the bureaucratic nature of many large companies. Nevertheless, entrepreneurs have to be very careful not to "throw the baby out with the bath water" as it relates to structure, systems and processes. Every business, large or small, needs these three essential elements to succeed. A sound organizational structure, efficient operating systems and consistent execution of core processes are crucial to your business's ability to grow from good to great. The key is how these elements are implemented, practiced and monitored. Collins writes, "The single most important form of discipline for sustained results is fanatical adherence to the Hedgehog Concept and the willingness to shun opportunities that fall outside [that model]." Basically, it takes discipline to know what to say "no" to.

  4. Flywheel and the Doom Loop: You are about to read something that is the complete antithesis of our microwave, instant gratification, get-rich-quick culture. Like a delicious home cooked meal, it takes a long time to grow a great company that gets consistent sustained results. Because of a flywheel's weight, it's hard to get it to start turning. However, after it starts turning, its weight causes momentum that actually keeps it going and even causes its speed to increase. Good-to-Great businesses build momentum with small successes that over time grow to become big successes. Attention to detail and perfecting what you do well now, especially the quality of your products/services and customer service, will create bigger growth opportunities for you in the future. On the flip side, short-term thinking/planning, chasing opportunities outside of your "sweet spot", and unethical behavior will lead to a downward spiral that is often irreversible.
There is much more to this book than I've highlighted here that you can use to transform your great idea into a great business. And no matter where you are on your business journey, start-up or 10-year veteran, there is always room for improvement. I believe that if you apply even a few of the Good to Great principles you will be well on your way to avoiding the 95% small business failure abyss. I look forward to your greatness!

Empowering Champions,
Paul Wilson, Jr.


Resources:

Good to Great by Jim Collins

The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It by Michael E. Gerber

Small Giants: Companies that Chose to be Great Instead of Big by Bo Burlingham

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Small Biz Overrated?

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Do small businesses really drive the U.S. economy?

Just as they say that there are two sides to every story, that can also be true with statistics. Sometimes multiple conclusions can be drawn from the same data, especially as it relates to small businesses.

A couple of years ago American Enterprise Institute (AEI) visiting scholar VĂ©ronique de Rugy made the controversial statement that small businesses didn't play as large of a role in driving the U.S. economy by creating jobs as the government and other organizations had claimed for many years. Based on her research, she believes that governmental policies predicated upon these deep-seated beliefs are not only wrong but actually damaging to small businesses and the economy at large. You can read the article, "A Talk with a Small-Biz Heretic", to get a better understanding of her perspective.

Earlier this month Brenda Porter, a journalist with Black Enterprise Magazine, wrote an interesting article about a recently released government report that stated small businesses indeed are an economic engine for the U.S. However, she notes that although the government is touting the growth of small businesses, some are taking exception to the findings. The article quotes Roderick Harrison, demographer at the Joint Center for Political and Economic Studies, as saying that on the surface, the report's conclusions can be somewhat deceiving. In the article he says:

"The report was issued by an office whose job it is to promote small businesses and create an environment that is more favorable. And they’re doing a good job presenting some of the ways small businesses have been successful. But I think the picture is a bit more complex."

In terms of how minority owned businesses are incorporated into this discussion, last summer I discoverd an interesting statistic in a report provided by the Minority Business Development Agency. In 2002, 4.1 million minority owned businesses had 4.7 million employees, which is an average of 1.1 employees per business. This means that a high percentage of those small businesses had only one employee (although I don't know how a business can have 0.1 employees... maybe it's those who are physically but not mentally present, but I digress).

That report also included an analysis that compared the number of minority owned businesses to the percentage of minorities in the population. The analysis revealed that if the number of minority owned businesses mirrored the minority population, i.e. "parity", there should have been 6.5 million small businesses that should have provided 16.1 million jobs. There's a big difference between 4.1 million and 16.1 million.

Another focus of their analysis was a parity study of minority business revenues. Actual revenues for all minority businesses in 2002 was $700 billion. According to their parity projections, actual revenues should have been $2.5 trillion. That's a difference of $1.8 trillion!

Now, there are plenty of reasons and factors why there are gaps between what these employment and revenue numbers are versus what they could/should be, which have been outlined in many studies, including the one here. And of course that was 2002. Still, how much has really changed since then? I wonder how those numbers would look for 2007-2008.

Interestingly, in the Black Enterprise article, Harrison actually points out that many of the small businesses in the government's report are really one-person operations, which he says might be one of the reasons that the unemployment rate is at the point that it is. So, instead of going to look for another job after getting laid off, many people may now go try to start their own business, which would impact employment statistics, especially if there are so many one-person firms.

The conclusion of all of this is that there seems to be a lot of differing perspectives and opinions by those who are looking at the same or similar information as it relates to small business's true impact on the U.S. economy.

What do you think? Does this argument challenge your perspective on entrepreneurship and its overall value to our economy? Do small businesses really drive the economy as much as is purported and promoted? Has the government done enough to create an environment for small and minority owned businesses to grow and create jobs? Should it do less or more? I look forward to hearing from you.

Empowering Champions,
Paul Wilson, Jr.


Resources:
"The Small Business Economy for Data Year 2006" by Small Business Adminstration
http://www.sba.gov/advo/research/sb_econ2007.pdf

"Is Small Business Driving the Economy" by Brenda Porter
http://www.blackenterprise.com/smallbiz/smallbizopen.asp?id=3982

"A Talk with a Small-Biz Heretic" by Stacy Perman
http://www.businessweek.com/smallbiz/content/dec2005/sb20051219_495192.htm

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Entrepreneurial Nation Building

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If you read my previous post, Pray for Africa, you will get an idea of the passion that I have for that great continent. Of course while prayer is essential, it is just the first step to creating change. The Bible says that prayer not accompanied by action is worthless (James 2:17). Therefore, in addition to praying, there is something else that I'm committed to doing. I have a vision for helping people in Africa build an entrepreneurial network that will result in exponential increases in economic empowerment, employment and education.

Poverty is such an oppressive institution that it often drives people who feel powerless to do desperate things, and in African countries and elsewhere that often involves violence. One of the keys to reducing this violence is to reduce peoples' feelings of powerlessness and purposelessness. That's why I believe equipping people with entrepreneurial skills and resources, coupled with creating governmental policies and business environments that support and encourage entrepreneurship, will help to empower people personally, economically and socially.

With this being the case, I was incredibly excited to find some enlightening and inspiring videos on YouTube of Paul Kagame, the president of Rwanda. He is talking about his belief that entrepreneurship can be a key component of strategically building a nation economically and socially. I agree with him wholeheartedly. Enjoy!


The Entrepreneur President, Paul Kagame of Rwanda - Part 1/2






The Entrepreneur President, Paul Kagame of Rwanda - Part 2/2





Empowering Champions,
Paul Wilson, Jr.

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Pray for Africa

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My heart is broken to see the violence that has swept the country of Kenya over the past couple of weeks. Until a few years ago, I probably would have not given much thought to the events beyond looking at the news or reading it on the Internet. I would have viewed the situation as "their" problem. I was sympathetic, but not empathetic as in I didn't share their pain.

In October 2006 I had a life changing, paradigm shifting experience. On my first trip across the ocean, I had the incredible opportunity to go on a missions trip to Rwanda. I came back from that trip with a whole new perspective on the world and an entirely new outlook on Africa. Before going, I thought I recognized them as human beings with hopes, dreams, feelings, issues, challenges, etc. Nevertheless, as crazy as this is going to sound, seeing them face to face and spending time with them gave me such a new and powerful appreciation for their humanity and dignity as human beings. For the first time, I saw Africans as my true brothers and sisters. But not just Africans. I began to see all people around the world as my brothers and sisters.

So, when I see the reports of Kenyans, Sudanese and many other Africans dying violently, especially children, I now feel a deep sense of sadness, knowing that my brothers and sisters are hurting. The images that I see on TV and the Internet now are not just of "those people", but they could be the family, friends or neighbors of the people with whom I shared stories, laughed, cried and built friendships. Furthermore, "those people" are future world leaders, business people, doctors, lawyers, Olympians, entrepreneurs, educators, scientists and more. If you want a real-time example, just look at what's happening in our own presidential election here in the United States.

I don't know how you feel, but I can't sit idly by and do nothing. The best thing that I can do right now is pray. Pray for the families. Pray for the children. Pray for the leaders. Pray for corruption to end and the violence to stop. Pray for poverty to decrease and education to increase. Pray for food to be plentiful. Pray for diseases to be cured and medicine to find those who need it. Pray for spiritual, emotional, and relational healing between the tribes. Pray a prosperous future, because whether or not you realize (or accept) it, our futures are tied together through the global economy.

Although, we as humans often can't understand why we do such horrible things to one another, God is able to handle it all. So, please remember to pray for Africa.

Empowering Champions,
Paul Wilson, Jr.

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