Enterprising deductions

10 steps to create a SCALABLE business

10 steps to create a scalable business (Adapted from the principles presented in the book Nail it then Scale it by Nathan Furr)
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  1. Identify a monetizable problem.
  2. Addressing the core needs of the target market develop a specific/focused solution.
  3. Create a very rough prototype that addresses the specific needs of the intended customer.
  4. Continually adapt the prototype based on customer feedback. The prototype should constantly be evolving based on feedback from those who will be buying the product/service.
  5. Develop the “go-to-market” strategy with the prototype findings and with thorough industry analysis.
  6. Soft launch on a lean budget.
  7. Measure and validate intiial pricing and adjust if necessary. Tweak the financial model and get a firm grasp of the economics of the business.
  8. Document all data and procedures to make checklists and establish the system. (collect customer info, develop database, document all procedural efficiencies, establish marketing metrics, test ad campaigns and the most effective portals to deliver the marketing message through and have detailed daily, weekly and monthly Profit and Loss statements)
  9. Once the core systems model is developed constantly reevaluate the offering based on continual learning from the customer.
  10. Rinse and Repeat. (Either scale the business or use this process to pursue the next venture)

Notice the repeating theme?… KEEP THE CUSTOMER INVOLVED!

Business ventures go astray, some early-on some later, when they start creating offerings or adding features they “think” customers will want. Don’t fall prey to this common business mistake, solve the customer’s “job-to-be-done” not yours.

What do you spend more time thinking about..

What do you spend more time thinking about.. the clothes you put on in the morning or the action steps you need to take to maximize the profitability of your business?
If we are honest with ourselves we will admit that there are long periods of time that we get stuck on auto-pilot, (thinking only of the short-term tasks to be accomplished and ignoring the long-term goals and vision) and we probably do give more cognitive thought to what we are going to wear each morning.
Lets start focusing less on the image we want to convey and more on the results we need to produce. Aim to be competent and effective, always learning. Exude effort to action steps that produce results rather than worrying about the quantity of your effort. Doing two hours of work that actually generates revenue is far better than slaving away for countless hours all week putting out urgent yet unimportant fires. Stop doing for the sake of doing. Take time to put daily “tasks” into the context of profitability.
Ask yourself “What is the purpose of the task I am doing?”,  “Can I have someone else do this?”, “Will this effort directly result in a more lucrative future or am I simply appeasing my self-imposed “hard-working” image by being busy?
Wealth not only favors the bold but favors the effective as well. The road to wealth doesn’t necessarily require efficiency but rather effectiveness. Efficiency is important but if you are not doing the right things then you are simply a great time manager. Effectiveness is doing the right things despite how long it takes. In business, efficiency is like a turbo booster when paired with effectiveness because after you nail the right “what” and the right “how” you can then maximize your daily output.
If you can’t measure the results of your actions you will be forced to measure “how much” work you do and “how long” it takes to do it. Acquiring currency is not about how much you work or even how efficient/productive you are. Money is acquired by knowing where to find it and executing on a strategy to attain it, that’s it!
Business culture puts much more emphasis on the process than the results but in the grand scheme of things focusing on “what” you are doing before answering “why” will lead you down a life path of busyness for busyness sake.
Hard work and persistence are crucial elements in entrepreneurship that is an obvious fact. I am not saying you won’t need to put your nose to the grind stone and work your butt off for periods of time but just keep the purpose of your work in the forefront of your mind. Let’s stop wasting valuable brain matter on which watch to wear with which shirt and which color pants and concentrate our effort where it matters, accomplishing our goals.

Yep, I could do work here!

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Unrealized Potential Sucks!

Is there anything worse than unrealized potential?

It would almost be easier, mentally, to have no potential than a boat-load of potential and never see it realized. This goes for people with potential as well as business opportunities. Since business is my focus I will be referring to the latter.

Potential is what forms partnership, solicits investors, and triggers the release of dopamine in our brains which gives us that optimistic feeling that “we could be on to something huge”. Potential is what every entrepreneur seeks, they keep grinding with the hope that the future has something better in store for them than the present. Entrepreneurs pursue ventures that have a great potential return on investment and this “potential” (ROI) is what they seek to measure to determine if the payoff will be worth the effort.

Essentially all business deals come down to the assessment of their potential. Those that can spot potential where it is not evident and those that can spot it, before “the herd”, will be successful. That is why unfulfilled potential is the absolute worst! You think every scenario has been thought of yet, somehow, one negative option slips through the crack and kills a lucrative deal. It’s those deals that are a complete win-win for both sides that are the hardest to stomach when they don’t go through.

In life and business there will be ups and downs, peaks and valleys, ebbs and flows, that is a fact. The deepest valleys, which are the most difficult to get through, are the ones that started with the most potential but for one reason or another were never able to be realized. But bouncing back from unprofitable deals is a major key to success. The faster you can “get over” a perfect deal gone bad and correct course the closer you will be to your next breakthrough!

I know it hurts to have that perfect deal slip through your fingers, possibly by no fault of your own, but you must learn what you can from the situation, dust your feet off and move on to the next deal… Your future success depends on it!

Is your “comfort zone” helping or hurting you… or both?

Should you be operating within your comfort zone or strive to grow and act outside of it?
When is it better to operate strictly within your comfort zone and when is it better to push your self beyond what is comfortable? The argument for each side is compelling. On the one hand you can argue that staying within your comfort zone is optimal because your “comfort zone” is the epicenter of your strengths. On the other hand it can be said that these same strengths that form your comfort zone can actually act as barrier that will prevent you from branching out and growing your experience.
comfort zone
To suggest that you should seek to outgrow your comfort zone and strive for something bigger is very intriguing. So intriguing, in fact, that this question of “Should I seek to get out of my comfort zone?” nearly captivated my entire thought life for the last couple hours. The premise of getting out there and meeting new people and seeking new opportunities truly intrigues me and it very much appeals to my personality style. But as I started traveling down this rabbit trail of thought I started to wonder if the entire premise of comfort zones is framed wrong, because it assumes that everyone has a similar comfort zone and that expanding beyond your comfort zone, in any direction, is beneficial. Basically we are assuming that, first of all, everyone has a strong understanding of themselves (which obviously is not the case) and that everyone has the exact same goals and convictions (also clearly not true, because not everyones goal in life is to be successful in business and strive for achievement) and lastly that their is no “wrong” direction outside of our comfort zones.
The idea of expanding your comfort zone is almost always presented by extremely extroverted “sales professionals” on how to create an uber-successful career. This message is generally geared towards less extroverted or heaven forbid ‘introverted’ individuals whom these “super extroverts” wish to compel to step-up to a better life. In the context of simply becoming a better communicator and possibly a little less shy then YES, forcing yourself to grow beyond what is comfortable is very beneficial. But what about a very out-going and personable salesman that wants to “expand his comfort zone” to do something he feels might be borderline morally wrong?
That’s outside the comfort zone so lets expand it baby! Who cares if it feels a little unethical, after a while your comfort zone will be so expanded that you won’t even think twice about it! 
 
EX: It’s like working out, there is a good “pain” (burn) from exercising muscles properly and there is bad “pain” that comes from improper form (like jacking up a rotator cuff or tweaking your lower back). The bad pain is your body telling you to STOP because it is not beneficial.  
The key is to strip everything down to the core, the core of your motives, goals, ambitions, convictions and get to your purpose. Only after you have this core-level understanding will you be able to determine which direction and how far outside of your comfort zone you should try to pursue. Remember that your comfort zone can act as your “conviction” meter letting you know that what you are about to do may conflict with your core beliefs and values.
Focusing on and improving upon your natural strengths as apposed to striving to round off weaknesses is, in my opinion, a much more effective strategy in the pursuit of being the best you can be. There is a fine line though, between staying “in the zone” to focus on being effective and apathetically sitting back while opportunities are within your grasp and letting the fear of the unknown decide your future for you!
Ultimately it comes down to understanding your core. With this understanding you will be able to identify those situations where your comfort zone is providing you with a healthy “governor” and those times when you are just being a big passive baby!  Do not be pressured to go a direction that does not line up with what you believe. Know your values and be aware when others are pushing their values upon you, so you can differentiate between “healthy” uncomfortable and “un-healthy” uncomfortable.
Build upon your natural strengths but do not let your comfort zone hold you back from the future you want! 

You DO NOT need Passion to succeed

I hear it all the time, “You gotta be passionate about what you are doing if you want to be successful.”… Do you? Is passion the magic formula for success?Untitled-1
I know plenty of people who are, and have been, very passionate about what they do and aren’t successful. I also know many individual who are not passionate, at all, about what they do and are extremely successful. Having passion for a business without a sustainable financial model doesn’t miraculously change the economics of it. If we are using business metrics to measure “success” it is pretty black and white (or should I say black and red). It comes down to one thing and that’s money, it either makes it or it doesn’t! And if a business is making money the next two measuring sticks are 1) profitability and 2) how much effort is required for that profitability? One could argue that passion has a very minimal correlation to success.
Our culture and society wants to have a tangible, preferably warm and fuzzy, thing to attribute to success. We want to identify one specific attribute that determines success or failure and we want it to be something anybody in the whole world can obtain so we feel like it’s possible for anyone to succeed. We hear all the time the same old recycled crap about the path to success; you need passion, persistence, to be a good communicator blah blah blah. While a large number of successful people claim to have these traits in common and attribute these to their success I would argue that it is purely in hindsight that they are trying give some concrete reason for their success. Passion, especially,  is the one trait that everyone loves to identify because it just feels good to say and it provides this accessible and relatable concept that all people feel they can grasp.
“I too can be successful if I just have passion! Woo Hoo Now I just gotta find what I’m passionate about!”
I’m not picking on passion, I think passion is good because it can amplify the significance of success when the two do happen to coincide. If you love scarves, (I mean really love everything about them like how they look and feel, what they do for people, how they are made etc) and you have a scarf business that takes off and becomes an astronomical success the passion you have for scarves will amplify the significance of the success. But lets say you just wanna make a buck and you see a niche in the scarf market and create a scarf business that hits it big. Just because you weren’t passionate about scarves does the somehow disqualify your success?
The passionate person says “heck yes, I freaking love scarves and now the whole world is getting to enjoy them as much as I do!” The un-passionate (opportunist) says “sweet, I didn’t know jack about scarves and I made a bunch of money selling them.”
There was no difference in the outcome of the passionate and non-passionate person the only difference was their perception of the “feeling” of success.
So what is the point of this rant on passion you ask? That “purpose” should be our pursuit because without purpose passion will fade. This beautiful revelation came courtesy of a pastor I recently heard speak named Paul Chase who is an american missionary living with his family in the Philippines for the last 20+ years. When I heard him say this I instantly put it in the context of business (which is just how my brain is wired). It hit me like a ton of bricks and made perfect sense. If you don’t have a firm grasp of your purpose you will just run from “passion” to “passion” seeking fulfillment from business ideas/ventures that can’t possibly satisfy you.
Success and passion are not interdependent of each other. Passion can act as a motivator or building block for purpose but independently will not sustain you and, in my opinion, it is not a predictor of success.
I liken passion to wind in regards to starting a fire.
Starting a fire doesn’t require wind it just takes a spark of fire, but wind fans the flame and strengthens the fire.
In other words:
Creating a successful business venture doesn’t require passion but passion can strengthen the purpose.

Strategy vs. Planning

14955696-magnified-illustration-with-the-word-business-strategy-on-white-background     Strategy is not “planning”. People often times lump strategy formulation and planing together. The process of strategy formulation begins first and foremost with thinking, more specifically the way in which you think. It is important when you begin to form the direction of your venture that you set aside specific time simply to think. Don’t fall into the “busyness trap” of doing things just for the sake of doing them.
     Great strategy comes from innovative thinkers who use their experiences and learn from the experiences of others to create unique insights on their situation. From these insights you can begin building the infrastructure of your business model, determining what resources to allocate and where and determining the trade-offs that will be necessary.
     Strategic thinking should also develop the mission, vision and values of the intended venture. The mental agility required to use key insights to form not only the purpose but also determine how this will be accomplished is no small feat. Disciplined thinking requires an adept level of understanding of the current situation which is why context is a very big part of the thinking process. It is imperative that you understand the context of your situation and how it fits into the perceived context of your target market. Context is how you put to good use all the ideas you have generated based on your knowledge and experience.
    Once you have established the “what” and how you will fulfill that “what” it is time to begin the actual planning stage. The planning stage is the natural progression that comes from strategic thinking. By using your key insights you begin to create your big-picture purpose as well as more specific items such as: how exactly you will create your competitive advantage, defining your resources and capabilities, knowing where to focus those resources and capabilities and determining the appropriate actionable next steps. You then simply channel this into a plan of action, defining goals and objectives.
    Planning is more tactical than strategic but a successful strategy must have a plan of exactly what steps need to be taken. The planning process is simply the act of putting on paper what has been established through thinking, therefore strategic thinking leads to strategic planning.
Takeaway: focus on improving the way in which you think to become more strategic.
 
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