The Termite Effect

December 7, 2010 by 1 Comment

“The Termite Effect” refers to the impact that many common business mistakes have on businesses, entrepreneurial ventures, management teams and on the careers of sales professionals.

As a business coach, I noticed that the damage done by many of my clients’ mistakes were going unseen for months or even years… just like the effects termites can have on your home. After all, termites never sleep, they just keep eating. Similarly, until corrective action is taken, the deleterious effects of the most common business mistakes on your business never stop. In both cases, at first the harm is not noticeable but over time as the damage grows more and more extensive, the foundation of your home or your business begins to collapse.

Termites live in subterranean environments because they do not like being exposed to light. Many of the most common business mistakes such as poor organization or resistance to change are often ignored or hidden, however, exposing them to the light (recognizing that they exist) is the first step toward avoiding them in the future or repairing those that you have already made.

Some of the other common business mistakes that I have noticed include:

  • Lack of understanding your company’s financial statements – Think of your financial statements as the blood work of your business. They can tell you a lot about what is going on below the surface.
  • Inability to identify what success looks like – In order to consider yourself a “success”, can you articulate where you want your business to be one, three or five years from now? Many business owners and entrepreneurs struggle with this question.
  • Living a reactive existence rather than a proactive one – How much time do you spend planning? Without it, you invariably will “just go with the flow”. You cannot survive long in a reactive environment.
  • Lack of measuring results – What do you measure in your business? If you cannot rattle off 3-5 key performance indicators off the top of your head, you are destined for failure. Remember: “what you measure will improve” and vice versa, “what you do NOT measure will….. “
  • Not generating enough leads – Marketing is to your business what petrol is to your car; neither can run without it. Do not neglect your marketing efforts.
  • Poor work/life balance – This mistake plagues most business owners regardless of how good their intentions are. They must make a concerted effort to work less and/or say “no” more to the multitude of responsibilities that their business thrusts at them, otherwise, they will risk burnout.
  • Not understanding your strengths or weaknesses – If you do not know yourself, you will struggle when it comes time to run your own business. You goal should be to spend the majority of your working hours performing those task and activities that you are uniquely gifted in and enjoy doing. Surround yourself with people whose unique gifts are performing those tasks in which you either hate doing or are terrible at.
  • Lack of delegation. This is a critical mistake for most entrepreneurs because they have a difficult time giving up control. After all, no one is going to perform the tasks as well as them. Delegation is a requirement of all successful entrepreneurs for sanity and efficiency purposes.
Filed Under: Small Business

9 Reasons Why You Should NOT Start a Business

December 4, 2010 by 1 Comment

A journey that begins with a wrong step seldom ends at the right destination.

1. Don’t Start a Business for the sake of MONEY
Top on the list of reasons why people go into business is the strong desire to amass wealth. I have never known of a more ineffective way to think about business than this. As unpopular as it might sound, most business failures stem from this singular fact alone. Why? Because the moment making money becomes your primary focus as an entrepreneur, delivering value which is the foundation of effective business practice becomes secondary. And when this happens, no matter how great your business is, it automatically goes on a downward spin. Nothing kills a business faster than putting money first before adding value to your customers. So when next you’re thinking about starting up a business, I suggest you lose every possible thought about making money and focus entirely on delivering consistently superior value. Trust me, I’m talking from experience (of other people), starting your own business for the purpose of making money is a sure fire way of failing.

2. Don’t Start a Business because you LOST your job
Closely related to the issue of money is going into business because you lost your job. As you’ve probably realized, this is how many people end up as entrepreneurs. At first glance, there might not be anything wrong with this approach of starting up a business, but taking a closer look will reveal a vital truth: people who lose their jobs are often driven by fear and to start a business because you are afraid is absolutely disastrous. The implication is often enormous: top on the list is that you will never exercise the due diligence starting a new business entails. Why? Because the fear of living without a regular income since you no longer have a job will keep haunting you and eventually start making you place unrealistic financial expectations on your new business venture. Second on the list is that you are emotionally unstable the first few months of losing a job, especially when you didn’t see it coming. The disappointment can be disheartening, the more reason why you shouldn’t go into business with such mind frame. Why? Because in the world of business, disappointments are a natural prerequisite for success. Meaning, the more disappointments you get, the closer you are to success.

3. Don’t Start a Business because you HAVE money
I know you’re probably startled about this one. You certainly didn’t see it coming. Well, it’s as wrong as starting a business for the sake of making money. How? Here’s the thing most people with money don’t realize, it doesn’t take money alone to make a business work. Starting and running a business will cost you more than all the money you think you have. There are just too many things a business will demand from you that money can’t even buy, for example: how much does it cost to buy the passion needed to build a SIGNIFICANT (unique and useful) business? Have you ever seen passion being offered for sale? In fact, no university or institute of learning can even teach you passion. Here’s the truth, having money is good, but it’s not sufficient enough to make you want to start a business. Starting a business requires gut, passion, ingenuity, creativity, resilience and so many other personal character traits that all the money in the world can’t buy!

4. Don’t Start a Business because you want TIME Freedom
The thought of not having to wake up early and rush off to work can be very enticing to would be entrepreneurs. But take it from me, I’ve been in the game now for 8 years; the fact that you didn’t wake up early and rushed off to work doesn’t mean you are not at work. Being an entrepreneur means working all of the time even in your sleep. That your fantasy of time freedom will naturally go sore once you choose to become your own boss. How do I mean? You see, it’s not that you wouldn’t have more time to yourself when you’re an entrepreneur, certainly you would. But the irony of it all is this; that time freedom is for you to do some creative work and not for you to be idle and indulge yourself in some unproductive activity. You left your job to have enough time to do what you really care about in life, that’s all the definition of time freedom you’ll ever get – having enough time to make a SIGNIFICANT contribution with your life to the world. True entrepreneurs hardly stay idle indulging in pleasurable activities just because they have time freedom. They are always in the creative process, picking up clues here and there of how they can make the world a better place by utilizing their time, money and life for something worthwhile.

5. Don’t Start a Business because OTHERS are doing it
Anything that is popular has a way of being highly contagious. People just literally jump at it without any logical explanation. Believe it or not, this is how so many people ended up in the world of business. Since everyone they know is quitting their 8-to-5 jobs to go start their own thing, why shouldn’t they do the same? The down side of going with the bandwagon is this; you’ll lack the staying power critical to survival in the world of business. At first, the thought of being your own boss can be very enticing, but sooner or later you’ll realize it’s not a bed of roses. And when this reality sets in, you’re the only one who would be left alone to figure out a way of making it through the stormy days. So start a business because it’s what your soul desires and not what the society or your peers desires for you. Starting your own business is not about boosting your personal ego or winning a popularity contest, it’s a personal decision born out of an internal conviction!

6. Don’t Start a Business because you HATE working for others
Now here comes the tricky one; starting a business because you hate working for others. After wanting to make money, this is another popular reason people give for going into business. Listen, as popular as it may seem, here’s the truth; 99% of popular things are either totally wrong or mere misconceptions. That you hate working for others is no guarantee that you will succeed or enjoy working for yourself. In fact, there’s more work to do working for yourself than you ever thought you did working for others. So if you hate working for others, you might just as well hate working for yourself. What it turns out to be sincerely is this: you simply don’t like work in general and this is why starting your own business is the last thing you should ever think of doing. Why? Because business is the domain of unlimited work; there are no working hours like your regular 8-to-5 job. Welcome to the 24/7/365 days a year working schedule!

7. Don’t Start a Business just LIKE everybody else (Differentiate or Die)
In my field of business development, I have seen so many people go into business just because they saw somebody else succeeding in it. This is a higher form of going into business because others are doing (point #5 above). You observe a business and simply go make a clone of such business. So what do we get? The same kind of business but with different brand names. I don’t get it: “Why would any right thinking person choose to be a duplicate of another when it’s absolutely possible to excel being an original?” As a matter of fact, you have higher chances of succeeding going into business as an innovator than being a duplicator.

The business terrain is already overcrowded with a countless number of companies doing almost the same thing you have in mind to do. Unlike in the past before the advent of the internet where you had only local or national competitors, now your competitors are all over the world and just one click away from your local or national target market. So why would you want to build a business just like your neighbour? Here’s the deal: if your business doesn’t stand for something SIGNIFICANT (unique and useful) there’s no need repeating what others have already done and giving it another name. Meaning, if there’s nothing positively unusual about your business, don’t bother going into business to offer the same old milk but now in a new brand skin or container. Doing this is the fastest route to extinction. In other words, differentiate or die!

8. Don’t Start a Business without SUFFICIENT planning
Business is a highly complex activity and therefore requires adequate planning. It’s been statistically proven that inadequate planning is top among the reasons why most businesses fail. I’m sure you already know that by now (that’s why it’s the second to the last point). Why then did I include it in the list? Because most times, the problem is not about what we don’t know but more of what we do know but never put to use or practice. There’s a phrase that best captures the essence of planning and it goes like this; “He who fails to plan, plans to fail“. And a key element of planning is having a long term perspective of things or as it is popularly called: seeing the big picture. Which intentionally, happens to be the subject matter of the next point to which we now turn.

9. Don’t Start a Business that cannot OUTLIVE you
One of the underlying principles of the Accounting profession is called: “going concern” which means that a business must be in perpetuity. That is, a business is meant to exist as far as there’s still a need to be met. It’s just basic human nature: I mean who wants to raise a child only to watch the child die before their eyes? In the same regard, you should never start a business that has a short lifespan. Starting a business from a short term or temporary viewpoint, as far as I’m concerned is the definition of selfishness. Why build something temporary when you have the potential to create something eternal? The joy of any creator is to see his/her creation rise above their widest dream and outlive the very existence of the creator. So here’s the ultimate question for you “does your business have the capacity to outlive you?” OR “Would your business still be in existence long after you’ve gone?” Never start or go into a new business without asking and answering these questions.

What then is the RIGHT way to start a business?

Start a business because you have something SIGNIFICANT (unique & useful) to contribute to the benefit of the human race!

Why?

Because a business is a tool that entrepreneurs create in order to make a SIGNIFICANT (unique & useful) contribution to the world by addressing a particular problem plaguing the human race.

Filed Under: Small Business

Print a Newspaper?

December 2, 2010 by Leave a Comment

We all know the story: newspapers are dieing everywhere, and most likely will start dieing in Kenya soon. So why should anyone print a newspaper anymore? And more importantly, where would you get one printed? Isn’t the newsprint becoming obsolete like the old cassette tapes did? In one respect that is true, but in another, more valuable aspect for businesses, newsprint is even more important today.

With the advent of the internet, most people are getting their news from websites accessed through a keyboard and a screen or on the mobile phone. Since, for the most part, it is free, who wants to pay for a newspaper anymore? Hardly anyone. The daily newspapers are going out of business, but the uses for a publication that people can hold in their hands has not really diminished that much. And if a business can take advantage of this, the rewards can be great indeed!

Let me explain. People still like to read. They still like to get information. And having something to read that is on paper instead of the computer screen has not lost its appeal. If you hand someone a free newspaper, he will probably read through it. He just may not want to pay for it.

Take a business that wants to disseminate information about itself to clients, customers, and employees. Spam is so prevalent that most information sent by email is often lost, ignored, or disregarded. But put a newspaper in a person’s hands with articles about the company, new products, new services, and current products and services and people are a lot more apt to read it.

It is the niche market that can now benefit from printing a newspaper. A church can deliver a message to the community through a newspaper, and a business can keep potential customers updated on exciting products and helpful information. Imagine having an 8 page newspaper filled with articles relating directly to your area of expertise. Imagine these newspapers sent to clients, customers, or even lying around in waiting rooms across your city. Imagine the name recognition. Imagine the marketing potential!

Every business can benefit from publishing a newspaper. It can replace expensive newsletters. It can generate cash flow. It can cover its own costs by selling advertisements in it. It can disseminate much more pertinent information. It can capture potential customers attention in ways that a typical ad or short newsletter could never do! It is perfect!

Publish a newspaper and be one step ahead of the competition! Get your message out!

Filed Under: Lazyweb

5 Signs That Mean You Need a New Job

December 1, 2010 by 2 Comments

In any job, there are certain signs which predict future dissatisfaction with one’s career. Here are five of these good indicators that it could be time to move on to a new employment opportunity:

1. You do not earn what you deserve
If you are performing the work of multiple employees, across multiple skill sets, you may be better off being self-employed. The hours can be longer, yet the compensation can be significantly higher when you are the boss. If you are not earning what you deserve, then you may wish to consider a second job, or a different job entirely.

2. Your current job no longer challenges you
A dead-end job can be tiring, exhausting, and stressful once it does not demand your peak performance. This can spill over into other aspects of your life, affecting them to your detriment if you are not careful. If advancement, additional duties, or other changes to keep you fresh are not available, then other employment can be highly beneficial for multiple aspects of your life.

3. You no longer get meaning from the work you perform
When your work environment no longer satisfies the deepest parts of your personality, it could be an indicator that you need to be working elsewhere. People change and grow over time, and if you have outgrown your job, or need more satisfaction from the results you contribute, then a change could be just the thing to keep you stimulated, engaged, and ready to tackle new challenges. Work is a big part of one’s life, and without meaning, it can be a hollow victory, even if everything else goes well.

4. You do not get added career enhancements from working there
A great job should provide you with more than just a paycheck. Additional skills, new experiences, and even new contacts can all be valuable assets in your career progression. If your current job offers none of these, then it may be time to re-evaluate your current working situation.

5. You have problems with the people at work
People problems can range from challenges with customers, all the way to issues with coworkers, bosses, and others. Sometimes, a clash of incompatible cultures is no one’s fault. However, if you have tried your best to resolve the issues, and yet they seem to be getting worse instead of getting better, then a change may be in everyone’s best interests, before things really get out of hand.

Therefore, if your current job does not pay you what it should; if it no longer challenges you or provides meaning; if you get no career benefits from working there; or if the people you work with are no longer a good fit; then it could be worth examining the other opportunities available to you. Then, whether you decide to take on a second job, or switch to a different job completely, it is more likely that you will be happier in the future.

Why starting a business is better than getting a job
It’s much better in the long run to build your own business, build your own list of contacts, employ others to work for you, control the fruits of your labor, but this path doesn’t usually mean an instant paycheck. The revenue comes later.

So if it’s otherwise a clear choice to start one’s own business instead of working for someone else, why would someone choose the latter? The main reason is urgency. If you need an extra 10,000 per month right now, you’re going to go out to get a part-time job because once you’re hired, the paychecks usually come in. If you don’t need an extra 10,000 per month right this moment to cover your current expenses, but instead want to improve your income and diversify your revenue streams, then it will likely be more profitable to build a business yourself than to support and build someone else’s business. This is the track you can take if you don’t need the extra income urgently.

Filed Under: Make Money, Small Business

How to Increase Your Revenues By Reducing The Number of Customers

November 24, 2010 by Leave a Comment

“Would you Cut the Number of Customers you have in Half if You Could Increase Your Revenue?”

On the surface, it seems like a strange question. As a business, more clients is always better than less clients (or so you think). But you have to remember where this question is coming from. What if you could successfully create a business in which you make the most money possible with the least amount of effort (and the headaches that go with it)?

The High Maintenance Client
Don’t get me wrong – you always want a lot of clients and it’s a good problem to have. However, you ideally want the best type of client. The high maintenance client is the WORST type of client because they take up all your time with calls, e-mails, fighting over bills, etc. The time you spend working with the client costs you more money than you ever make from that client.

The problem with high-maintenance clients is that they are very hard to identify. But the fact is that the more clients you have, the more high-maintenance clients, and the more headaches you have to deal with.

Double Your Prices and Lose 40% of Your Clients – Awesome!
This is one of the keys to creating a business in which you make the most money possible with the least amount of effort. Maximize the revenues from each client and if that means losing a lot of clients, you are ahead. Take a closer look at that statement.

Let’s say that you were charging your 50 clients Kshs 1,000 per month, so you were making Kshs 50,000 per month.

Now, let’s say that you doubled your price to Kshs 2,000 per month and because of that you lost 40%, or 20, clients. You still have 30 clients, paying Kshs 2,000 per month or Kshs 60,000 per month.

You lost 20 clients, which means less operations, less support, and less administration, etc. but you gained Kshs 10,000 per month! And that’s not just Kshs 10,000 total. With the reduced overhead and operational expenses, you probably gained even more than that in profits.

Even if you lost 60% of your clients and now made just Kshs 40,000 per month, but you reduced expenses by Kshs 10,000, you’re still ahead. You have more time and resources to commit to those activities that will bring you more money.

But before you just send out a letter to all our clients saying that you are doubling their prices, there are some things you should be aware of.

How and When to Raise Prices

  • Don’t Raise Prices in a Commodity Business. This strategy does not work if you have a commodity type business. If someone can go to your neighbor and get the same product for half the price, you will lose most of your customers. This only works if you have a niche product or service that is differentiated from what other companies offer.
  • Don’t Raise Prices on Existing Clients. The way that you can implement this strategy is on new clients. You will piss off a lot of existing clients if you raise their prices all of a sudden and it’s not worth it. But when you start marketing and selling to new clients, raise the prices on them. They do not know the old price so they will not be pissed off and while your conversion rates will be lower, you will see more revenues and less headaches in the long run.
  • Get Clients First. One of the first mistakes that we ran into when we tried to implement this strategy is that we did it on a new product that we were offering. It was a type of marketing website and while it was a good niche product that wasn’t commodity based, we had no idea what the market would bear. Looking back, we should have just started selling it very cheaply and then once we got some momentum, we would have raised the price to what we think the market would bear.
Filed Under: Make Money, Small Business, Tips Hacking and Reviews Tagged With:

Stop Whining!

November 22, 2010 by 2 Comments

There are a lot of legitimate reasons for being unemployed right now. However, if you are a recent or soon-to-be graduate you should really stop whining. Just because you got a degree does not qualify you to be employed. Sorry that nobody told you, but it takes a lot of work outside the classroom to get a job.

Many industries are hiring. There are plenty of jobs out there. Do the work to find them. Figure out what it takes to stand out and seem more qualified. Sending your resume in doesn’t count for a damn thing. Complaining and whining endlessly counts for even less.

Filed Under: Miscellaneous

20 Things I Learned About Browsers and the Web

November 19, 2010 by Leave a Comment

What’s a cookie? How do I protect myself on the web? And most importantly: What happens if a truck runs over my laptop?

In an attempt to teach the average person about the fundamental of browsers and the web, Google has released an interactive online book that explains concepts like, TCP/IP, HTML, browser extensions and malware.

The short book, 20 Things I Learned About Browsers and the Web, is a step-by-step explanation of the web and how it works. It was created by the Google Chrome team using HTML5, but it also features a lot of clever illustrations by award-winning German illustrator and children’s author Christoph Niemann.

The focus of the book is on 19 different topics (plus a recap, making for 20 things). It starts with “What Is the Internet?” and then dives into cloud computing, web apps, web programming languages, browsers, privacy, security and open source.

Source: Mashable

In your quest to do business online, is there anything that you do not understand about the web? This is your chance to learn:

20 Things I Learned About Browsers and the Web.

Filed Under: Cool Sites, Internet Culture, Small Business Tagged With: