10 Keys for Preventing Startup Sabotage

August 31, 2011 by 1 Comment

Startup SabotageAs an entrepreneur, you’re bound to run into challenges and obstacles at every stage of your venture. It’s survival of the fittest, even in seasoned businesses, let alone a fledgling startup. You’ve seen the statistics that ominously warn of the failure rate within the first year of business, and while the stats don’t necessarily tell the whole story, there’s no doubt that making it through your first year is no cake walk. But there are some steps you can take to improve your odds. To prevent you from sabotaging your business, here are a few pointers to practice:

 

Ten Good Habits of Successful Business Owners

1. Provide a product or service that’s viable

When you come up with the initial idea for your business ask yourself, “Is there a need for this? Who is my target customer? Why will they want to buy or need this?” Many businesses sound like they could be wildly successful, but maybe only at first glance. Researching market need and product or service viability is an absolute must if you hope to succeed.

2. Seek advice

See your idea and business with a different set of eyes. Seek advice from successful people in diverse businesses – experts who can comprise your team and be your focus group. Do your homework, and take heed of their advice and startup stories. In Small Business, BIG Vision, we explain how and why to set up an Advisory Board. This is one of the best ways to ensure your business is being guided well from the start.

3. Find a balance for change

Sticking to your business plan is admirable, but when the world is changing around you at light speed, you better power-up for some changes. Seek a balance between making so many changes that you’re no longer stable and just keeping the status quo. We talk a lot about flexibility in the book, and this is the one quality that can serve your business well at any stage – and in any economic climate or market shift.

4. Use your budget wisely

This one is a balancing act too. You need to use your money to make your business grow. Have some money to market yourself, and make people aware of what you have to offer and where they can find you. But be sure you don’t just spend and run out of cash before you even get up and running. Lack of capital is the number one reason for early stage business failure. Don’t let your company become part of that statistical group.

5. Hire the best, and fire the rest

Finding the best people to staff your new business can take time. Responsible, intelligent, creative, and passionate people are out there and want to have meaningful work, especially in this job market. No business owner has to keep non-team players who ruin morale and don’t contribute on a daily basis. Of course also remember that employees aren’t always the answer. As we detail in Small Business, BIG Vision, outsourced workers can be a very valuable tool for early stage startups.

6. Use the right resources and tools

All the home remodelers on TV make it look so easy. That’s because they have the right tools. They’re not using a hand saw to do what a miter saw will do in seconds. The right tools can make any work easier, faster, and more accurate. They don’t have to cost a fortune and can even be second-hand. Subscribing to trade periodicals, newsletters, and buying guides can also make it easier for you and your staff to work smarter.

7. Price Properly

Ask for advice with actual customers or a focus group, to find out what your product or service is really worth to them. If your product is perceived to be priced too high, you have sabotaged your success. If priced too low, you’re loosing profit margin. Perceived value for the price paid is what sells – not necessarily a rock-bottom price. Don’t make the mistake of competing solely on price early on, or you could be stuck under-pricing your offerings forever.

8. Focus on customer experience

When the service you provide your customers fails to meet their expectations, you lose them. It doesn’t matter who was “right.” The old saying about an unhappy customer telling everyone about their experience is true – and very damaging to your reputation. The bottom line is that there’s plenty of competition in every sector, and there’s always a competitor willing to sell what you offer for less. Differentiating through outstanding service is the best way to build loyalty and secure your business for the long term.

9. Mind your own store

Some entrepreneurs seem to be obsessed with their competition, the market, or other factors outside their business. Knowing what your competitors are doing is important, especially to startups; however paranoia about them or other outside factors shouldn’t keep you from managing your own business. Focus on what you’re doing to make your business a success, and customers will gladly tell you about your competition. From there, it’s just a matter of managing your time in a way that prioritizes nurturing your own business over worrying about everything else.

10. Find “me time”

Non-entrepreneurs often think that because you have your own business you can take off whenever you want. NOT! Sometimes you eat, breathe, sleep (or not-sleep) every day at your work. It’s a commitment that can wreak havoc with life-work balance. Having a day off, or even a few hours, will not kill your business, especially if you have the right team of people working for you and you trust them. Working hard on a new business is a given, but burnout is your body saying “Out of Business.”

If you’re not doing all that’s listed above right now, remember – it’s never too late to put a good habit into practice. The most important thing in business is that you keep your focus on your BIG Vision and never give up!

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3 Big Rules of Effective Planning with Teams

August 16, 2011 by 2 Comments

Team PlanningWhether we’re talking about a comprehensive formal business plan, a one-page-business plan, or an on-the-fly plan for a particular project, one thing is for sure: some form of planning is absolutely necessary for reaching your BIG Vision. As we discuss in Small Business, BIG Vision, there is a danger of falling into “planning paralysis” if planning is taken to the extreme. But that doesn’t mean planning isn’t a good idea – just that you need to do it the right way.

This is especially true when members of a team get together to create a plan. Below are three important rules for effective planning with a team of employees or partners. Read through them, and share your thoughts in the comments section. What would you add to the list?

1. Choose the Right People to Assist in the Planning Process

When building a planning team, it’s important to choose committed people who can offer valuable insight and ideas regarding business growth. What’s not important is that the members of your planning team have roles of leadership within your company. To make someone a member of your planning team simply because of their position within the company is a mistake. An effective planning team can consist not only of supervisors, but also sales people and other staff members within your team. Including people from a variety of roles helps solidify your team, and it’s a great way to identify unrecognized talent.

The most important consideration is that your planning team consists of people who truly want what’s best for the company and are willing to work to achieve the overall goal of the planning process. Another important consideration when choosing members of your planning team is to choose people who, regardless of their role in your company, have the ability to keep information shared in planning sessions completely confidential and are eager to participate and contribute to the process.

2. Look at the Long Term Future of the Business

Start by looking at the big picture of success for the future of your company. Once you have a clear vision of the big picture, begin to narrow your focus a bit. Start with the present and first address problems that require immediate attention. Come up with an effective plan that will best solve any issues and allow you to implement the finished plan immediately. Once you’ve addressed any immediate issues, it’s time to develop a realistic vision of where you want the company to be in one year, five years, and ten years. By doing so, you’ll have created a goal that all of the members of your team can strive together to achieve.

Here are some questions that will help you to nail down the long term vision for your company:

  • If you could travel ten years into the future, what would the world look like?
  • Are there any trends that might affect the growth of your company – for better or worse?
  • What are some of the issues that businesses in your industry are likely to face?

Of course you can’t really see into the future, but it is possible to create a realistic vision of the future for your business. Once you do that, the members of your planning team will have a much better understanding of what their individual roles are in the long term vision of the company.

3. Face the Facts

Be 100% honest with yourself and your crew when you examine any issues that are in the way of your company achieving its goals. By denying or sugar-coating problems, you’re not only being dishonest with yourself, but dishonest with your entire team as well. Deal with these issues in a well thought-out and calm way.

Include your team of employees in the process of coming up with solutions to the challenges within the company. Doing so will not only help you find different ways of looking at the issues, but your staff will feel included and significant. Including your employees in these types of decisions helps to build morale and encourage cohesiveness within the team. When people feel as though their opinions are valued, they’re far more likely to strive to achieve common goals of the business.

Business planning can actually be a fun process – especially when you bring together a team of creative, committed professionals. So don’t dread creating plans. Know that the work you do to put the right plan in place now will pay off many fold in the end.

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Answers to 5 Common Entrepreneurial Questions

July 28, 2011 by Leave a Comment

Entrepreneurial QuestionsWhen trying to decide whether or not to take the plunge into entrepreneurship, you will have an endless number of questions. Whether it’s your first shot at being in business for yourself or you’ve done it before, some questions are sure to continue popping up. Below are some of the most common questions with some ideas about how to answer them. This article won’t answer all your questions, but it will get you off to a great start!

 

How will I know if my business idea is a good one?

Speaking with potential customers before you go forward with building on your start-up is important. By speaking with these people, you will either have your assumptions validated, or you’ll learn that they were all wrong. Either way, you’re gaining some valuable insight. Although it can be difficult to hear criticism at times, learning from criticism can save you a whole lot of time and heartache. Certainly don’t fool yourself by assuming that the source of the criticism is crazy and you’re doing everything correctly. Be realistic and face the truth gracefully.

 

How do I fund for my start-up?

As we outline in Small Business, BIG Vision, if at all possible, you don’t. Bootstrapping is always our preferred startup method. One good idea is to start out by doing some consulting services for customers, which tends to have almost no overhead. By doing this, you’re not only supporting yourself, but you’re also remaining in contact with the customers and are learning which problems they have. Then you can develop a product or service based on a clear understanding of what your customers’ wants and needs are, rather than on your assumptions.

 

In the next five years, which industries have the biggest growth potential?

Look around. What big problems do you see? By looking for problems, you’re also looking into the biggest opportunities. Poverty, homelessness, energy crisis, water crisis, etc. All of these are huge problems. You could address some of these problems with your new company. Another place to look for problems is within big companies. In every industry, there are giants, and it’s inevitable that within these giants of industry, there are places where they are weak. You can look for these holes and create an expertise related to them. For example, although Google is obviously the largest search provider, it’s not the only one, because others have seen where they are lacking and created companies around the needs that are not being met by Google.

 

How can I possibly overcome my fear of failure?

In the book, we focus on the importance of having a clear vision. Your vision helps overcome fear because it allows you to picture your business as successful and focus on that picture. You also need to find some sort of philosophy to draw inspiration from. Whether you get your inspiration from a book like Small Business, BIG Vision or Aristotle, the important point is that you’re gaining inspiration. It’s becoming increasingly popular for entrepreneurs to use other business leaders as their sources of inspiration. Look around – there’s something out there for you.

 

Where can I find mentors?

Take a close look at the people who you’re surrounded by every day. Who has your respect and truly believes in you? Do they respect your work? Someone like this has a terrific potential for becoming a good mentor for you. This type of relationship is a very personal one, so it’s important that you have good chemistry with one another, and not only common business interests and goals. You can expect to invest a lot of time and emotional energy with your mentor. If you can find someone who will allow you to do a little bit of work for them, it can provide a setting in which they can coach you. In a sense, you are working for each other in this way.

So, what about all the other questions you have? Take the time to seek out people who will not only answer your questions, but also provide you with examples of their own experiences. The more knowledge you can gain ahead of time, the more successful you will be. Some of our BIG Vision Offers include time with both of us, and we’d love to work with you to answer your questions and get you on the road to successful entrepreneurship!

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