Leverage

The essential "secret sauce" of a magical business.
See this TED Talk video of Charles Leadbeater
for some insight in this matter.

Fascinating!

We get mail: Questions and Answers

A friend in England has sent a few questions for her publication, reprinted here with permission...

What do you believe are the main or most common reasons for small business failures?

The typical answer is "lack of capital", but the real reason is because the business did not get the Sales it needed to offset expenditures. It's really that simple. The essence of success in business is success in Sales. Of course, there are many other reasons why a business might fail even if Sales are good (embezzlement, fraud, partner disputes, poor management, lack of financial controls, and more). Another major reason for failure is giving up too soon. Success requires perseverance. Another major reason for failure in business is lack of planning. (See Commandment #4)

Is the customer always right, or are there times he is plain wrong, and should you tell him?

Yes to all 3 questions. The customer is almost always right because what they are telling you is how they want to do business with you, and it's always a good idea to listen to customers with an open mind. However, on rare occasions a customer will be absolutely wrong, but if their attitude is good and the amount is (relatively) small, you write it off as goodwill. However, sometimes you get a customer who is so wrong (chronic complainer, rip-off artist, etc) that they should be terminated. Firing a bad customer is some of the most fun you can have in business. It's theraputic! (See Commandment #3)

What does the word 'change' mean to you?

It is eternal and omnipresent in all aspects of Life, and that includes Business. It is Newton's second law (Entropy). Basically, it means that everything is always falling apart. Ignore it at your peril, but more importantly, embrace it for the Opportunity it contains! (See Commanment #10)

What are the main traits that all successful businesses share?

Continuous sales increases. Motivated employees (See Commandment #6). Financial controls (See Commandment #8).

What are theearly warning signs that all is not well in your business, and what can you do to avoid the point of no return?

The really bad news is usually delivered in a phone call by the bank manager. That's when things start to get desperate. But before that happens, you should have seen it coming, in your monthly financial statements. However, if you focus on increasing Sales, and focus like a junk yard dog, the only call you will get from your bank manager will be to take you to lunch, his treat.

What is the most effective form of lead generation when a business has limited funds for marketing?

Use the internet for networking, search for customers and new markets, email broadcasting, newsletters via email, website content creation, free offers (white papers, e-books, etc).

Many business owners find it hard to measure success, what advice would you give?

The true purpose of the business is to support the owner's chosen lifestyle. Unfortunately, many owners find themselves slaves to their own business. You are not your business! It is a separate entity which you control from the top of the pyramid rather than buried under it. Delegation is essential for success in business.

For more on these topics, please refer to
The Ten Commandments of Managing a Young, Growing Business

Something wonderful is going to happen...

Those were some memorable words from the movie
"2001: A Space Odyssey"
and they describe some new adventures
which I'm working on.

Check out

ThinkPlanDoRepeat.com

and

2clicksAday.org

The 5 Essential Skills for Success

There are 5 essential entrepreneurial skills for success:

Concentration,
Discrimination,
Organization,
Innovation,
Communication.

Michael Gerber
author of "The E-Myth"
why most small businesses don't work,
and what to do about it.


I recommend this book to everyone in business.

Practice, Perseverance, Passion.

What does it take to be Great?
Is there such a thing as a "natural"?

The answers are here
in a recent story in Fortune Magazine.

The bottom line is that all exceptional results
require lots of Practice, about 10 years of it
according to the story.
And that's focused practice,
not just putting in time.

Here's their System for Practice:

1. Approach each critical task with an explicit goal of getting much better at it.

2. As you do the task, focus on what's happening and why you're doing it the way you are.

3. After the task, get feedback on your performance from multiple sources. Make changes in your behavior as necessary.

4. Continually build mental models of your situation - your industry, your company, your career. Enlarge the models to encompass more factors.

5. Do those steps regularly, not sporadically. Occasional practice does not work.

Notice the feedback loop,
which is an essential ingredient for any System
if it is to react to the constantly changing environment.

---

On this same topic,
Calvin Coolidge said it perfectly:

"Nothing in the world can take the place of persistence.

Talent will not;
nothing is more common than unsuccessful men with talent.

Genius will not;
unrewarded genius is almost a proverb.

Education will not;
the world is full of educated derelicts.

Persistence and determination alone are omnipotent."

---

Of course, if you have a Passion for what you do,
Practice and Perseverance come naturally.

Consider this well...

Post It Power

Here's a little something I've been wanting to do:
A customized Post-it note to deal with the stuff
that comes across my desk in a non-stop blizzard.

The trick is to handle each item only once,
and to move it out of the In pile to the Out pile
as quickly and efficiently as possible,
thereby leaving absolutely nothing hanging about
to make a complete mess of things.

This is a general purpose note to my assistant
that saves me countless writings of the words
thank you, file, donate, etc.
I especially like the yin-yang graphic,
which is a little Zen island of calm
in what can sometimes get to be a high-energy day.

I designed this little critter online at iPrint.com
I could get a low-volume at a low price for this prototype.
("Do Good Now, Make It Better Later")

The System for Revealing Secrets (NDA)

Everyone is concerned about revealing secrets.
Can you trust the person who needs to know more before they can help you?

This challenge has been solved long ago
with a document called a non-disclosure agreement (NDA).

Click on the link below, and modify it to suit your purposes.
Just remember to get your own legal representation.
I'm not a lawyer and I'm not giving legal advice.
That's the job of your lawyer.

Non-Disclosure Agreement (Bi-lateral) (MS Word .doc file)

This piece of paper will never
keep people from stealing your secrets, of course.
But it puts people on notice that you are serious
and will use the law to protect your interests.

My take on "ideas" is that they are really worthless.
It is only by the hard work of making them real
that they have any value at all.
Most people will never be interested in stealing your ideas.
They have plenty of their own to deal with.
Further, if someone was really so dim-witted that
they needed to steal someone else's ideas,
then you can probably rest assured that they
are dim-witted enough that you could easily win in the market.
And, could they ever match your passion for the idea?

For a system for protecting your inventions, see
Inventors' Assistance League, Inc.
Watch the video, then contact the top guy there.
His name is Rusty Ruscetta and he has been
a good friend more than 15 years.