So… in this harmony “thing”,
it applies to business and life…
it only happens in the moment…
And, it starts by embracing the “Absolute Truth”…
So… WHAT IS THE ABSOLUTE TRUTH about business?
I love business.
I think about it non-stop.
I read about it every chance I get.
And, so often what I see and what I read is so OFF the mark.
This is my 2 cents… This is what I believe is,
THE ABSOLUTE TRUTHS ABOUT BUSINESS.
1. Long Term Success is driven simply by a Differentiated, Relevant, and Available Service or Product.
Nothing else matters in the long term. Your level of profitability, which is your level of sustainability is driven by the level of your differentiation. Differentiation doesn’t have to mean creating the next iPOD. Differentiation is almost always subtle. It’s the gas station that is on the correct side of the road closest to the highway. It’s so often geography. It can be service. It can be that restaurant that has that amazing single dessert or dish that keeps you coming back.
I have seen GREAT differentiated products, NEVER sell or grow, because they couldn’t figure out how to make them AVAILABLE. Truth is we buy what we can access. The easier the access the more that sells. Access / Distribution can be a massive differentiator. So often distribution channels are not considered “differentiation” because they are not “sexy or innovative”.
Trust me. I want to create and innovate. But, realize that iteratively every step of differentiation and relevance gains you momentum. So many people are “waiting” to find the next massive innovation, that they never innovate iteratively, or they don’t give importance to it in their business… and they end up failing.
We talk about “strategy” all the time these days. The only strategic conversation that matters is HOW ARE YOU CREATING A RELEVANTLY DIFFERENTIATED VALUE? And, everything you do should be attempting to drive the answer.
2. Business Success is COMPLEX, its about the On-Going and OPTIMAL BALANCE between Product/Service, Employees, and Clients.
I have been a part, in one way or another, or have witnessed various business failures.
I have been a part of “client first” companies that didn’t understand how to make money and almost went bankrupt. “If you take care of your clients” or “if your clients are happy, then everything works” I’ve heard the saying go. Nope! Too many clients don’t care about you or your profitability.
I have seen the Japanese companies in the ‘90s bring 20 employees into every meeting, with the “employee first” mindset. “If you take care of your employees, then they will take care of the business, and the business will take care of itself” I’ve heard the saying go. Nope! Employees can’t control external forces and can’t necessarily control your clients’ behavior.
I have been part of a wonderful company where products where everything. Design a relevant differentiated product and it will sell. I have seen SO MANY business people and inventors in LOVE with their products. “How could anybody NOT buy this?” they think. “Build relevant and differentiated products and they will sell” I have heard the saying go. Nope! Great products that are not understood are not bought. Great products that cannot be accessed or are not priced right cannot be bought.
So many businesses want to carry a FLAG! We are a “Client First Company!” Woohoo! Or, a “Employee First”…
Business Management is about the OPTIMAL BALANCE at all times of these three components… BALANCED into a model that ENSURES PROFITABILITY!
How do you know if its balanced right? You should be making money! I know many of you are thinking, “its not just about money, what about purpose?”. TRUST ME – Sustainability of Business is about profitability. Yes, purpose is CRAZY important, but without profit, purpose is just the Poster that hangs on your wall.
There are times when you do need to make it all about employees. Stress is high. Organizational changes are rocky. Compensation is off. You MUST focus on employees… while considering the other two… and then you need to come back to the center.
There are times when your product is struggling – or new products are needed. If you don’t get the product right, relative to the competition, you lose. You MUST focus on product…. While keeping your eyes on the other two. And, then come back to the center.
There are times when your clients need attention. You MUST understand what they need in order to better serve them, or you MUST resolve some issue they are facing to keep their trust. So you do that, keeping in mind the other two and then return to center.
If you do not embrace that business MUST be about a love affair with all THREE of these at once. And, heck, LOVE HAS NOTHING TO DO WITH IT. IN fact, love can be blinding. It’s a perilous and often anxious balance between the three. It’s often a tug of war between the three. It often looks so clearly like you need to choose because it’s a zero sum game.
There is no single answer. Don’t buy a flag to hang on your office wall.
Business success is about the ON GOING OPTIMAL BALANCE between the three. Period. No way of getting around it. It’s COMPLEX. Try to make it too simple and watch it fail. (By the way – this is also what makes it so very exciting!)
3. Success in Business requires accepting / embracing that the business landscape is in a STATE OF CONSTANT MOTION. It is ALWAYS CHANGING.
So often I see people blaming business. Business has gotten harder. Business is more difficult these days. There is nothing wrong with my company, it’s the business that no longer makes sense… HUH?!$%&*!
So many people come up with a single formula for business and never change it… and eventually it stops working… and they keep pushing on the same formula… on the same buttons over and over again… and slowly watch it fail.
“All we need is more sales” these folks tend to say, with the best of intentions. We used to sell more, if we could just sell as much as we used to sell we’d be fine.
The pace of business, of information, of market shift, of innovation HAS NEVER BEEN FASTER.
Businesses are made up of people. People’s behaviors change, their needs change, their options change. Businesses are competitive by nature. Competition is always changing – and so often not your direct competition, but the competition you didn’t even realize you had!
You must be CONSTANTLY evaluating your balance and checking in confirming that it still makes sense. You need to constantly be attempting to reinvent yourself in a more relevant way. THERE IS ALWAYS A SOLUTION TO BUSINESS PROBLEMS… There really ARE! When we feel like there isn’t its because we have locked our brains out of possible solution sets. I see people so absolutely tell me, “This is the only way this can be done”… over and over again. And, if that is what you believe… A – you shouldn’t be leading the company and B – you wont find a different solution.
PACE is massively important these days. You must have PACE! You must be WILLING to consider changing at all times…
Keep asking the questions. Are we adding relevant value? Are we differentiated from the competition in a meaningful way? Do clients like our product? Are they buying more of it or less? Do people like working for us? Why or why not? How do we make it better?
The questions are often the same… but business is ever changing and the answers will be as well.
4. PROFITABILITY IS ULTIMATELY IMPORTANT
There is nothing more important. I know some of you out there are going to say, “what about start ups?”. OK. I will give you that one. There are times when you must use capital to “get the motor started”. But friends, let me stress to you – EVEN on start-ups, my two cents is GET TO PROFITABILITY (Break even) AS QUICKLY AS POSSIBLE!
The moment you understand and control your profitability – you have control over your destiny. PERIOD!
Start ups that don’t get to profitability and die out of start up funds – either A – DIE, or B – End up giving the vast majority of the company away to have the chance of surviving.
Companies that ALLOW themselves to EXIST without profit DIE or LIVE ON OTHER PEOPLE’S TERMS (i.e. the banks). I have been a part of various great examples.
On an existing business, saying that we will get to profitability within 2 years is NUTS. Ok – if you have significant cash in the bank, you might have a way to do that, but WHY???? Why wouldn’t you get yourself to break even faster and use your cash to improve upon your company?
TOO MANY BUSINESS MANAGERS accept that lack of profitability is an acceptable approach to business. While there are maybe a couple of times when that may be true, they are very rare exceptions.
GET YOUR BUSINESS PROFITABLE! FAST! NOW!
MAKE THE HARD DECISIONS! ACCEPT THE TRUTH!
Allowing a mindset that lack of profit is ok – means in the vast majority of cases NOT DEALING WITH THE TRUTH… not being willing to right size, not accepting your products obsolescence, not acknowledging the competitive landscape, not cutting back on necessary expenses.
Your PROFIT is your BUSINESSES OXYGEN… Would you try to run a race and say that your approach is to hold your breath for the first two miles?
MAKE MONEY… BREATHE DEEPLY!!! PROFIT MUST BE THE EXPECTATION. Leaders that propose or recommend plans that lose money for more than brief periods should be seriously questioned and in most cases relieved of their duties.
5. BUSINESS IS ABOUT PEOPLE… Everything is! PURPOSE MATTERS!
If I am going to buy a flag ;-) It’s the PEOPLE first flag. Employees are people. Clients are people. And, in one form or another, your product is made by people or your service is provided by people.
It matters what people are feeling.
It matters what people are thinking.
It matters what people are believing.
The level to which you are in touch with your PEOPLE – you are in touch with your business.
To care about people doesn’t mean you never fire anyone (client or employee or vendor). You need to do what is right to achieve the OPTIMAL BALANCE. But, to care about people means that you always do it with respect, with candor, with transparency, with concern.
SO many people say, “It’s not personal, it’s business”. Why do we think ORs are possible. Businesses are how we feed our families. How in many cases, we realize our dreams. How we exist. What happens in our businesses – happens in our lives!
This is why PURPOSE is so relevant. As people, we want purpose. We are motivated by purpose. We are driven by purpose. We are aligned by purpose.
At EMG our purpose has been to A – help our clients make great decisions by giving them accurate and timely intelligence so that they may be able to have long standing successful businesses, and B - help anyone who comes in contact with our company take some meaningful step toward their dreams.
We all need a reason to get out of bed every morning. Paying the bills is a reason, and an important one, but why not reach higher? The level to which your organization is driven by purpose often drives the level to which your employees are engaged and satisfied by the experience of working on your team.
This is why honesty and transparency and reasoning are so critical. We all want to every so often say, "Because I said so!"... But, as a person, how often have you heard that as a rationality and been motivated by it? How often have you heard that and wanted to deliver your very best?
PEOPLE matter… they need to be considered, energized and inspired.
Business leaders that fail to embrace this make their lives and their businesses so much more difficult… so much less rewarding.
If you don’t embrace people – you put your business at risk to one that does and you fail at what is one of the most amazing things about business… to create a living thing in your business… an organization, a group of people and clients that is ready and willing to fight and win together… Business can be and should be inspired… but so often we define that as “unnecessary” or “irrelevant”… “It’s about the nuts and bolts” I hear people say… NOPE! Trust me, it’s about people!
I could write for hours on this topic. I hate stopping at just 5 ;-) But those 5 have a ton of granularity within each one.
Embracing the absolute truth of business and then IN EACH MOMENT… moving it toward the reality we WANT to create… toward the success we dream about creating…
So of course the last important truth about business... is the same one about life... harmony APPLIES. It applies to strategy setting, to organizational leadership, to problem resolution, to all aspects of it... Nothing can be accomplished over the next quarter or the next year... You can't sell "Annual Revenues"... you need to sell EACH CLIENT on EACH SALE on EACH DAY...
Business, like life, ONLY happens in the moment. Once you embrace the truths - then its about how do you apply effectiveness into EVERY MOMENT...
What are you doing RIGHT NOW to set and drive strategy, to strike the optimum balance, to embrace people? In any given moment, you can't work on all things... but you must be working on SOME thing...
When you understand and lead with the moment in mind - you can achieve greatness. When you talk about purpose and direction and business plans out in time, people smile; some are excited, some are detached, and some just think "if only"...
Truth is... IT'S ALL POSSIBLE, IF ONLY we embrace harmony in the moment, and use EVERY OPPORTUNITY in EVERY DAY to make it all come slowly, deliberately and purposefully to LIFE!
That’s harmony…
IF you are in business… How deeply do you really embrace these truths? Which ones do you disagree with? Which would you add?
Yours in harmony,
Nestor