Business tips that work (Part I)

By Engr. Carlos V. Cornejo

Another set of nuggets of wisdom from self-development and entrepreneurship guru Brian Tracy on how to set-up your business that is fail-safe and successful.  This is from his lengthy talk at genuisnetwork.com conference and this would need two articles to cover it.

FOCUS

When Bill Gates, his father and Warren Buffet had a get-together and was asked point-blank what is the most important skill for success (in business and career)?  The three easily agreed on having focus.  It’s almost a black and white formula.  If you can’t focus on your business it will fail, and if you can, it will have a great chance to succeed.  An attendee of Brian Tracy seminar on “Focal Point” many years ago who was broke and had no job, came out of the seminar very much inspired and thought of putting up a coffee shop in New Zealand.   He started with zero knowledge about coffee shops but rolled his sleeves and went on to research and put to reality his coffee shop business idea.  After a few years, he had 80 coffee shops all over New Zealand and Australia.  When he was asked what advice can he give to aspiring entrepreneurs who want to be successful, he replied, “Two things:  focus and fail-fast.”  Fail-fast means move on right away after every failure after learning from it.

THINKING

In any field of work, what is the most valuable and highest paid skill that any worker does?  Answer: Thinking.  Thinking is akin to planning.  Before you act you need to think.  If you act without thinking or planning, you are bound to fail.  The quality of your thinking dictates the quality of your life.  Something is important if it has big consequences in your business or life.  And a thing is not important if it has minimal consequences.  The mistake most entrepreneurs do is to make quick decisions on important things and slow decisions on unimportant things.  Things like hiring people are important.  Peter Drucker says any fast hiring almost always ends up in disaster.  So, the more important the issue the more time it needs to be thought out because it could make or break your business.

ZERO-BASED THINKING

The idea of Zero-Based Thinking comes from Zero-Based Accounting.  In Zero-Based Accounting, instead of increasing the budget of an item, you rather asked “Is this item really necessary?”  You then could achieve an effective cost-cutting system by removing any unnecessary items.  In Zero-Based Thinking, you follow the “KWINK” acronym which means Knowing What I Now Know.  It applies to a worker, investment, partnership, etc. that knowing what you now know of the things mentioned would you still keep them.  If the answer is no, then replace the worker, get rid of that investment, or cut-off that partnership.  The idea is to minimize your losses by getting rid of things that drag your business as quickly as possible which is aligned to the concept of failing fast.

UPDATING YOUR BUSINESS MODEL

The term “business model” is a common jargon in business schools.  It simply means how you achieve profitability in your business.  It’s all about how you make sales, producing and delivering your product or service, advertising your product, etc.  Your current business model might not be a total failure but might need fixing or even a complete overhaul because if you don’t, your competitor might come up with a better one.  Half of the many products you offer might not be profitable and it’s time to get rid of them.  You might need to sub-contract some of your operations to save on operational expenses.   Or it might be time to move on to a related business from your current one such as moving from a hotel business to a condominium.  More on this in the next article.