13 TPE Part III - Chapter 6-converted

The main ideas from this information are: - There is a misconception that entrepreneurial drive is only present from birth, but it can be discovered later in life. - It is important to take action on entrepreneurial ideas when they arise. - Saying no to certain opportunities and clients is necessary for success. - Focusing on what is important and saying no to distractions is crucial. - Saying no can make people more interested and lead to better opportunities. - A company achieved significant growth by focusing on their top nine clients and saying no to others. - Experience can be valuable, but it can also limit creativity and hinder progress in business. Chapter 6, Are You Ready Now? Up sluggard and waste not life, in the grave we'll be sleeping enough. Benjamin Franklin First, let me dispel a great myth. There is a common misconception circulating around that says if you don't exit the womb with entrepreneurial drive, then you're done, or at least you'll never be able to achieve the levels of natural-born entrepreneurs. While I agree that your desire is part of you from birth, just because you haven't discovered it yet in yourself does not mean it's not there. Your entrepreneurial drive could be somewhere deep inside, dormant, waiting for you to find it. Most people get entrepreneurial inspiration in a flash, kind of a what-if moment, as it were. For example, mine came during a drunken stupor a few years after graduating college. The point is, it doesn't matter when it hits you, be it in college, soon thereafter, or when you're 90 years old. What does matter is that you take action. If you don't take action, your drive may wane for a while, but only to come back years later and bite you in the ass. The toilet paper entrepreneur knows that when the urge hits, it's go time. Know your way to success. Until you close some doors, it's impossible to open others. Great business growth requires saying no way more often than saying yes. Here's a question for the guys. I don't mean to offend anyone here too much, but who are the most desired girls? The ones you can't have, right? Not the girls who are hoeing around. You sure as heck don't want to be in a long-term relationship with one of those loose chicks. Who knows what, or whom, she's been doing behind your back. Plus, you can get some gross diseases that way anyway. It's probably the same for the girls, right? You want a great, non-creepy guy who's going to stick around and be committed, not the guy who's with every girl at the party. I know, I know, some people like the challenge of taming the bad boy or the bad girl, but how many of those relationships work long-term? Squat. That's how many. So, do you want to be known as the industry whore doing any project for anybody at any price just because you think you have to stay busy to grow? Be selective, otherwise you'll get a reputation and none of the decent businesses or partners will want to get in the bed with you. Turn away projects that are best suited for someone else and those that are not in line with the beliefs outlined in your prosperity plan. Start saying no to grow. If you've been short-changed, ripped off, taken advantage of, unfairly pressured, squeezed, or even under-appreciated by a client, the problem is yours to fix, not his. You must commit to saying no to all those crappy clients, bottom-feeding prospects, and unfit opportunities this year. Seriously, right now, get on your knees, look up to the sky, and swear you will start saying no. Don't worry, no one is looking. Did you do it? Did you get on your knees? No? Good. You're learning to say no. But if you did do that little exercise, start this section over. You clearly haven't learned the lesson. You. Yes, you. Saying no is all about sustaining your absolute focus. If you haven't grasped this yet, I'm going to continue ramming it down your throat. Your success is entirely contingent upon your foundation of enabling beliefs, your relentless focus, and your actions consistent with those beliefs and focus. When you are starting and growing a business, the unimportant stuff keeps creeping in. The distractions, from reading every email every second it comes in, and clicking the send and receive button a hundred times just to check, to constant instant messaging thefts, to working on opportunities that are not in your niche, to time-chewing meetings that don't help anyone. You need to say no to this stuff and focus on what's important. Another cool thing about saying no to certain people is that they become hungrier. They want what they can't have. A classic example is alcohol consumption among teenagers. It is chic to have what you're not allowed. Even though booze is illegal to anyone under 21 in the US, teenagers represent a huge consumer base for the alcohol industry. You will find in your own business that certain clients you tell no will come back with a better, more fitting proposition, and you may suddenly find yourself happily saying yes. Today's most successful companies have been influenced more from what they have said no to than what they have said yes to. Think about this for a moment. How to sink in. If you're nervous about this, I get it. When you're just starting out in business, it may seem crazy to say no to anyone. How are you supposed to grow your business if you turn people away? For two years, I served on the board of the Young Entrepreneurs Organization, now called simply EO, and was responsible for growing the membership of our local chapter. Both years, I won the award for facilitating one of the three fastest-growing chapters in the world out of over 100. For the ten years prior to that, the chapter had grown about 0.5% per year. I bumped that number up to 75% growth per year. You know what I did differently than the guy before me? I said no. I limited admission, telling prospective members they had to pass an approval process to qualify for membership. I rejected everyone the first time around, and those who were eventually accepted couldn't wait to pay the membership fee. That's the power of saying no. The top nine list. Joe Spano, president of BuyRight, Inc., took his 25-year-old stagnant business and increased annual revenue by 60% in two years just by saying no. What he did wasn't complex. The whole plan fit on a single poster board. Joe's strategy didn't cost a dime. It simply required a new mindset. It all started when Joe recognized that his team was in a constant scramble to satisfy the needs of its 100 key clients and that the company's beliefs were compromised. They wanted to do more, faster, but with so many priority clients, it just wasn't working. Joe realized it was impossible to have 100 key clients. It's like saying you have 100 best friends. It's just not possible. Joe and his colleagues took action immediately, developing a customer ranking strategy founded on three simple questions. One, is the customer already a significant annual revenue producer, or if not, does the customer have a realistic potential to become one? Two, will the customer commit to a schedule and frequent communications with BuyRight to discuss its needs? Three, does the addition of this customer to the key list significantly improve the overall synergy of the entire group? With this list of three vital questions, Joe's team sorted and identified its list of 100 key clients and called it down to nine. The top nine was posted above every desk in every office from the receptionist to the CEOs. BuyRight then committed, with no exception, to do everything possible to say yes to all requests from the top nine. More importantly, it said no to every other customer every time that customer's needs were not 100% consistent with the needs of the top nine. In Joe's words, we essentially built our business around the needs of nine customers, not everyone's needs. We became truly specific customer driven. All other customers were simply extensions of these top nine. If they did not like that, they lost them and they were prepared to accept that. Within one month of implementing the new strategy, BuyRight replaced one of the top nine and it wasn't just any company. It was Wal-Mart. Yes, the biggest retailer in the world was removed from BuyRight's top nine client list because it did not pass requirement number two, communication. By saying no to the majority and yes to the minority, BuyRight experienced skyrocketing revenue. But that's not all. The benefits to the top nine were so effective, they trickled down to the other clients who also bought more, driving a 10% increase in revenue from the clients in that sector. By far, the most impressive benefit was the bottom line. This new mindset resulted in a profit increase of 250%. This is a lot of cold, hard cash. With a new mindset, business boomed. It really, really boomed. Joe's once sluggish company achieved sales of 19 million only two years after implementing the top nine strategy. He was on pace for 25 million in sales during the third year when BuyRight was snapped up by an investment group seeking fast growth companies. All that success from saying no. Joe Spano is a toilet paper entrepreneur. The dark side. Experience is nature's way of teaching us the results to expect when we behave in a certain way. When it comes to many of life's situations, experience is an invaluable asset. Think about grabbing a scolding hot iron. Do it once or observe someone else doing it and your experience will clearly remind you never to do it again. That's a good thing, but experience has a dark side too. We anticipate results based on our experience when, in fact, the same results may never happen again. While our experience indicates danger, there may be no danger at all. Experience stopped me from eating French toast for over a decade. Experience may stop you before you start. A danger of having prior business experience is that it may cloud your vision and cause you to use outdated strategies when what's really needed is a new approach. Like a lemming, you follow your experience and rigid business fundamentals right off the ledge to your death. Things are changing so quickly in business that if you're adhering to experience from a mere five years ago, the world has already passed you by and laughed you a few times. Entrepreneurs who master and adhere to core business life principles, such as treat others the way you'd like to be treated, succeed because they make decisions based on their value systems, not the almighty dollar or expert opinion. Those entrepreneurs who adhere to life principles and constantly adapt to elusive business dynamics experience enormous lasting success. Never started a company before, walking into it with no perceived notions, no baseline to judge your progress against, thank God you've got a chance of making this work. Haven't been there, haven't done that. If you actually knew everything that would be expected and required of you to start your own business, you might actually be smart enough not to do it. That would be a shame. Imagine if the founding fathers of the United States thought about every variable and planned out every detail of the American Revolution. If they had thought it through, they surely would have known it was a foolish thing to even try. Let's see here, the British have a far larger army, their forces are much better equipped, they have tons of money, they have tremendous amounts of war experience, and they are motivated to keep us in their kingdom. In comparison, we have no army at all, we will need to make one. We don't have uniforms or adequate equipment. Not many people really support the cause. We don't have our own currency, and this will be our first war. Now let's get into the details. We need to attack the British here, then run over there and attack them. We'll need to do crazy stuff like cross frozen rivers, attack the British on Christmas Day, and use a marginal general named George to lead a lot of the battles. As things move along, we must convince other countries to come help us fight. If we win, George will become president, not king, and relinquish a lot of his power to others. And then, when this is done, we need to make England our key ally going forward. What's a knock down, drag out death match among friends? If they really started to dig into the details and figure out each step, they determined it was a hopeless fight and given up before it started. That would have been the smart thing to do. Instead of an elaborate plan, the Founding Fathers had a crystal clear vision and purpose in the Declaration of Independence, which they wrote early in the war and used to attract the support of people who shared the same values. This document, this final commitment, put America on the course to kick ass. The Americans took their cause step by grueling step through an ever-changing dynamic process. After each win and each loss, their short-term plan was adjusted to be in alignment with the envisioned future. Success was due to simple planning, unwavering focus, and letting the bullets fly right away. The impossible became very possible because the Founding Fathers weren't bogged down by what they didn't know. They hadn't been there and they hadn't done that. Thank God! The learning and the tweaks and the changes all happened as they moved along. The only constant was their vision. What you don't know can pervert you. This title is a bit of a stretch. I went for the play on words here. When I use the word pervert in this context, I mean to stray away from the proper course. Got it? Good. Now work with me, you pervert. Not too long ago, my father planned to tile his kitchen. Overall it was a relatively simple project, minus a couple corner turns. The planning stage went from a few hours to a few days. Then his engineer mind went into overdrive and the detailed investigation went on for weeks. He wanted to make sure that every element was addressed and even set up a mock layout using the actual tile in his dining room. Every day, the planning became more and more intricate. One small problem would be resolved, but it would cause two more micro-adjustments. Those adjustments would yield the need for more change. Finally, the day came to install the tile. So guess what happened? Right. The tile did not fit. The corners were not calculated correctly, and he had to pull up the tile and do it again. But this time, he executed a basic plan and the ultimate goal, not a detailed step-by-step action guide. When I asked him about the failed project, my father taught me a lesson I will never forget. I overthought it, he said. Then he called me a nosy bastard. He experienced the result of over-processing something, of thinking too much about it. It was this uber-plan that he discovered, umpteen paths that perverted him from achieving the original goal. Here is a little bit of a paradox. Properly executing a process is all about doing it first, then planning for it. The first time through is often best served with less planning and more doing. The first time through is about dynamic adjustment and improvement as you execute. Only after you have successfully completed the process is it time to go into the details. Why after? Because now you need to make it repeatable. You need to ensure that it can be done to the same standard, the same way, every time. It must become measurable. As the process is repeated over and over by something or someone other than you, your job becomes constant observation and improvement. Yes, the devil is in the details, but you will have a devil of a time getting anything done the first go-around if you are fixated on it. So when it comes to process, rough cut a plan for the first job, but don't try to anticipate the details of unfamiliar territory. Use the experience to learn and improve. Then get into the details for the next go-around and master a repeatable process. Anyone know a good tiling guy? Burn the boats. This is a story that has been floating around for centuries. True or not, it holds a powerful lesson. A young military leader faced a situation that required him to ensure the success of a critical battle. A loss would have resulted in the collapse of his military, a tragic ending to the war. The leader's situation was made worse by the fact that he was facing an opponent who had him greatly outnumbered, was positioned defensively, often the superior position in a fight, and had the advantage of better equipment. Unshaken, the leader loaded his soldiers into ships, sailed to the enemy shores, and unloaded his soldiers and equipment. He then gave the order to burn the boats that had just carried them. Addressing his men before they set out to battle, he said, you see the boats going up in flames? That means the only way we can leave this land alive is if we are victorious. We have no options. We win or we perish. They won. You must do the same in your entrepreneurial endeavor. You must cut off all the alternatives and put your entire being into the success of your new company. By burning away any and all methods of retreat, you will focus your mind and body on moving forward. This is essential to a successful launch. Go burn your boats. That is, unless your business is selling boats. Take action now. Compared to the last two sets of action steps, these three exercises will be a breeze. I'm going to say 20 minutes tops. One, think about times in your life when you said yes and really should have said no. How would your life be different today if you'd gone with your gut? Two, identify your key customers, the people and businesses that make up most of your revenue and also make you feel good about doing business with them. How could you structure your business in a way that would allow you to say no to those people and businesses who are not key customers or who do not fit with your prosperity plan? Three, how has inexperience been an asset in your life and in your business? How has it been a liability?