How Accountability Helps You Succeed

Do you have an accountability partner?

Having a great strategy or business model is only part of the process of building a successful business. You need someone to help keep you accountable and push you on your journey. Your accountability partner is the person(s) that keeps you moving forward, tells you when you mess up, looks out for you when you are venturing into new territory, and offers a different (objective) perspective. That can be a single person, a group of people, or even an online community.

In this post you see the 5 most important things you need to look for in an accountability partner. 

One quick clarification - this is about finding an accountability partner for your business. There are lots of versions of "accountability partners" that run a spectrum of interpersonal needs and various configurations, I will be covering exactly none of those. 

1. Empathy + Commitment.

You need to find someone who understands your story. They might not have to agree with your values or your core “why” but they have to acknowledge that what your business is doing is important. The same goes for you strategy and why you are looking for someone to help you stay accountable. They have to be committed to helping you take the actions and make the choices you need to make to grow your business. It will definitely be less than helpful if your accountability partner isn’t reliable in providing you feedback and constructive advice. Kind of defeats the purpose. 

2. Challenging.

They need to be challenging. What I mean by challenging is that they will do their best to ask you the hard questions about how you are moving your business forward. That doesn’t mean they have to question each and every piece of your strategic framework but a good accountability partner will not let you slip on deadlines or deliverables without a fight. Remember you asked them to help keep you in check because you needed some help with your accountability - try not to lash out when they are holding you to it!

3. Open and earnest conversation.

Your accountability partner needs to get to know you a little bit. It’s important to have conversations around what motivates you, any weaknesses you have, and what your goals are for this relationship. Trust is a big part of this so make sure the person you choose is comfortable with having these conversations with you. You also need to set expectations early on for everyone involved because this about helping you take action in your business and you are leaning on someone that is potentially on the outside for help. 

4. Decide on metrics.

My all time favorite saying is - What gets measured, gets managed. This absolutely applies here too! You are getting someone to help keep you accountable, it’s important that you are tracking your successes and failures so that your accountability partner knows how to best motivate you. Deciding on metrics includes deciding on how frequently they will be checking in on you too. You should be setting times to meet or chat regularly with preset metrics you are working on so that you can report efficiently and work on the things you need the most help with. 

5. Take responsibility.

As a business owner it can be almost too easy to blame your business woes on any number of externalities. That has to stop. Unless there is an absolute market meltdown you have a lot of power in how your business is perceived and the responses you make to what’s going on in the economy around you. Successful strategy is about choices and allocating resources. It’s about taking action and measuring results. It’s about iteration. Those are all things you can take responsibility for and it’s how your accountability partner is going to push you to being a better business owner. 

Everything in this post can be applied to what you might be looking for in an accountability partner or even mentor. If you are a part of a larger organization and are working on your department's strategy look for some senior leadership or even a colleague to help you up your implementation game.  Accountability partners can be an amazing resource and you shouldn’t think that having one means you are showing weakness. If it says anything at all, having an someone to help make you better can only be seen as a strength. 

If you are struggling to find someone you can trust feel free to reach out to me! I am always willing to help entrepreneurs that want to get better. 

Here's What United Airlines Can Teach Us About Customer Service

United Airlines what are you doing?! 

First David Dao, then a scorpion and now an engaged couple are escorted off a plane by a marshall for not wanting to disturb a fellow economy riding sleeping passenger. 

I reiterate, what are you doing?! 

Unfortunately investors (and the market) shrug off bad press a lot faster than the consumers that are the subjects of the press but, the last few weeks have been a great example of exactly how NOT to deliver good customer service. To support that point I’ll defer to the UAL (United Continental Holdings) stock charts and direct your attention to the fact that amidst all the non-apologies, outraged passengers and those “re-accommodated” by Oscar Munoz the UAL stock is still hovering around rolling six month average prices. 

Without spinning off and trying to tackle the complexity of running a successful airline business in a highly price sensitive, highly regulated, low margin and monopolistically competitive market I want to focus on one thing - the customer. 

I want to use the poor behavior of United Airlines as an example of how companies should be treating their customers during less than ideal times. Great customer service will help you weather bad press and it will keep customers coming back. In an industry where the services are pretty much substitutable that extra edge can make a big difference. 

1. Your customers have to come first. 

Your customers are the lifeblood of your business. You’re job as a business owner is to make sure that your customers not only get the service or product you sold them but also an experience that warrants them coming back (and bringing friends). Sometimes though, there are hiccups. Sometimes you run out of products, sometimes you deliver late and sometimes you overbook a flight. That should never be the customer's problem. Remember, they chose to spend their hard earned dollars with you and if something happens that impacts how you deliver your value then it’s up to you to make it right. 

Now with United and David Dao that could’ve meant maybe offering the Department of Transportation’s $1350 maximum if the delay a passenger experiences is more than two hours before moving from voluntary to involuntary denied boarding procedures. If you run into a situation in your business that prevents you from delivering a less than awesome experience then I sincerely encourage you to eat cost of over-accommodating now to make it easier for your customer. It will prevent you from having to backpedal to your audience later hurting your credibility and forcing you to constantly “re-accommodate”. 

2. Consistency matters. 

Most people are willing to try a new product or service at least once. If they aren’t happy with it they explicitly let you know by not engaging with your company again. So, first impressions matter. After that first impression though, for the customers that do come back, they will be expecting some consistency in their experience. That means that as a business owner you have to spend time and energy on making sure that the experiences you’re providing always meet the high standards you have for your business. It’s why your customers keep coming back and why they will trust you when you try to sell them something new. 

If a figurative scorpion happens to drop out of a figurative overhead bin it may be the result of some slacking standards. Possibly. I’ve seen this a ton of times, when a business owner gets a little too busy it can be really tempting to cut, what you think are little, corners. I really insist that you don’t because your customers will notice, they always do! 

The four biggest reasons for consistency then are:

  • it will allow you to collect data that will help shape future decisions about your business,
  • it creates accountability for you and your customers,
  • it helps support your credibility and keeps you relevant,
  • and it supports your efforts in delivering on the mission of your business. 

3. Happy customers make for great brand building. 

Everyone loves a good love story. What everyone loves more than a good love story is when an airlines keeps an engaged couple from arriving at their destination wedding location due to some really bad customer service. Now this story might not drop the stock price but the constant sound bites playing on the radio, TV stations and YouTube channels will not make for a happy image. I’m not saying that when your customers break your policies or are challenging to deal with that you should just let them steamroll you but there’s got to be a better middle ground. I mean, going from zero to air marshal seems a little aggressive. 

If you’re looking to turn your customers into your advocates you have to listen to them empathetically, acknowledge their feedback and look for solutions that are mutually beneficial. When people see your business as one that not only provides a great product or service but one that really cares about the people it serves you get buy in. This is how you build community around your brand and where your ravings fans will come from. 

To build or grow a business that people will emphatically stand behind you have to care about your customers. You have to show them an experience that will make them want to come back. You have to be willing to listen to them when things don’t go quite right. And, you have to show up for them every day. You might not have the budget to outspend a competitor’s marketing or investment in infrastructure and that’s ok. Consumer’s will always do business with the people they know, like and trust before any shiny marketing campaign or new technology. 

10 Quick Actions To Grow Your Business

Grow Your Business.jpg

T-Minus eight days until the 2017 tax filing deadline. I’m hoping at this point you’re not one of the people that’s waiting until the last minute to file because we all know that’s when software stops working, Post Offices run out of stamps and servers are so overloaded that your returns never get transmitted. But that’s not you right?!

Right!

With all that extra time you can work on other parts of your business.

I’ve been running into businesses lately that are looking to get out of the flurry of their day to day to do’s and get into acquiring their next clients or customers ASAP. Which is what I'd like to help you spend that extra time that you have because you won't be scrambling to file your taxes.

Spring, in general, is an awesome time of year for businesses - the flowers start to bud and business owners start to pop their heads up from their desks and realize that maybe they weren’t as proactive as they thought they were going to be through the winter.

So, let’s get to working ON (not in) your business!

It’s my job to make access to better strategy easier and more actionable for you. In the spirit of that, and to kick off Spring 2017 right, I have put together a list of 10 quick actions you can take today to better shape your business’ strategy and to make your business more profitable.

Action 1: Decide who is going to get your focus right now.

You need to be able to articulate those who are the most important in your business right now. Is it a specific kind of customer, a new market segment, the people you’re interacting with online, the neighboring businesses in your community, your fans, etc. Getting clear on who you want to give dedicated focus to will help you better hone how you spend your energy and more articulately measure the return you’re getting on those efforts.  

Action 2: Look Around.

Determine who your most relevant competitors are and understand how they do business. This will help you dial in what makes you special and how you deliver the best value to your customers.

Action 3: Business Aspirations

Get clear on what success looks like for you. Is it a dollar amount, a specific profit margin per transaction or a certain number of customers served? Being clear and SPECIFIC about what success looks like will help you make more consistent decisions in your business.

Action 4: What Gets Measured, Gets Managed.

You won’t know if you are spending your time well if you aren’t keep track of it. The same goes will all your resources. Right now, pick a few things that you think are important and start tracking them. How can you know if your business is on the right track if you aren’t measuring what you are doing?

Action 5: Communicate Your Mission

For your strategy and your business to be successful, everyone involved needs to understand not just what you are doing but why you are doing it. Is your mission and vision written or presented in the easiest most earnest way possible? People won’t support you if they can’t understand why what you are doing is important.

Action 6: Stop Planning.

Strategy is not planning. Strategy is deciding what’s important, creating a way to make systematically better decisions and taking action. Do something right now that will push your business forward in way you can measure that aligns with your mission.

Action 7:  Competitive Advantage.

It’s really tough to be the lowest cost option and the highest quality {insert what your business does}. Don’t worry about chasing market share and start worrying about what you do better than everyone else around you. Make a conscious decision to focus on keeping what’s special about you and communicating that specialness with everyone.  

Action 8: Look For Trends.

Customer’s tastes and tastes are always changing. Look for trends in how people are spending to make sure that you are delivering what they want how they want it.

Action 9: Do All Of Your Branding Assets Align?

Perspective and perception are everything in business. Take stock of what your business culture looks like. Does how you run your business match how you interact with your customers? What about your social media and other web assets - are all of those personas aligned? People are a big part of your strategy and how you present yourself to people matters.

Action 10: Simplify Your Business Model.

Businesses are most profitable when they are easy and intuitive to deal with. Look at how your business functions from start of customer relationship to finish. Are there any steps you can remove, streamline or products/services you can repackage. Your business model is how you make money, it’s important that you make it as easy and as clear as possible for better engagement.

Strategy doesn’t get better of more effective unless you actively work on it. You shouldn’t just be winging it! You might not have time to do all of these right now but pick the ones you think could help you get motivated and taking actions first and knock them out.

Commit a little time to making your business more profitable this year, I mean it’s still only April!

Oh oh oh..before you go, I want to share something with you! If you were wondering if any of the stuff I write about is worth anything I want to share a testimonial with you. This is a business I’ve worked with that’s seen some great results because of the work we’ve done together. It’s super exciting because it means the stuff we talk about (and the stuff I write about) really works!

Last week Nunzio gave a very compelling feature presentation about how he helps businesses maximize their profit. This week I want to share how he has supported Serenity since we started working together four months ago.

The first thing we discussed was setting Serenity apart from all the other yoga studios in the valley. And there are a lot of them! He asked me specific questions to flush out my value proposition and to get me thinking about my mission and vision for the business. Where did I land? Real people, doing real yoga, with their real bodies. Catchy!

Nunzio helped me identify and describe my ideal client so we could brainstorm techniques to sell more services to both current and future customers. We talk regularly about building relationships with fellow community businesses to generate sales and using current satisfied customers to help spread the word. We’re now talking about bringing in new products that I can sell to current customers to increase revenue. Green tea or Luna bars, anyone? He held my hand while I raised prices, he played a large part in developing the script for my commercial and he remains extremely patient with me as I struggle with my technological issues. And, we support all our ideas and decisions with data. The numbers don’t lie.

Drum role please … thanks to Nunzio’s support, I have increased my revenue year over year by 80%! I think that’s pretty impressive!

Finally, Nunzio is the consummate professional. He pushes me outside my comfort zone while also maintaining guardrails to keep me focused. He learned all about the yoga industry in order to provide educated opinions and direction. I am extremely grateful for his support and his positive attitude. Being an entrepreneur can sometimes feel pretty lonely, but it’s nice to know I have someone in my corner who is always watching out for me!


Michele Lyman
Serenity Yoga
— http://www.serenityyogastudio.net/

How To Ruin Your Credibility

Building a business is hard. It’s hard to make your way through all the little decisions you need to make to pump out a minimum viable product, launch, and then grow. It can be hard to get and then keep people’s attention. It can even be tough to figure out what makes your ideal customers tick. 

Well, I should clarify just a little bit. It’s not inherently hard, it’s a ton of work and for the most part people just make it hard on themselves. I’m not saying that there isn’t  learning curve or an investment you have to make in yourself, what I am saying is that it takes dedicated attention. 

It takes focus and dedication to not only get a business up and running but to keep it running. As you grow your business you will be adding even more variables to the mix. All the while you have to maintain your position as a credible resource. More than providing value at each transaction (social or monetary) your customers and clients will keep using you because they like you and can trust you. 

One of the cores of building a successful business is establishing yourself as a credible resource. A person (or business) that people can trust to deliver on the promises you make. 

If finding success is NOT what you are looking for then I have 5 ways you can destroy your credibility. 

My honest and humble opinion is that you do the opposite of these. 

NOTE: There is going to be a lot of sarcasm going forward. I really hope you do the opposite of these 5 Tips :) 

1. Don’t follow up.

Following up is time consuming. It’s easier to just “yes” your way through conversations, networking events, and professional/social interactions. Eventually people will just stop putting any value on you and your ability to deliver if you don’t follow up. Developing relationships takes time and empathy and if you treat them like a commodity you can potentially free up your time for other things.  

2. Be inconsistent.

Customers, clients, family, and friends stress too much on reliability and consistency. If you are bringing a product or service to market it’s always easier to wing it. Being inconsistent will help lower your stress on the quality and value of your delivery and it will generally lower everyone’s expectations. You only really need that first sale from every customer right?! 

3. Always do everything yourself.

It’s challenging sometimes to try to trust people with the really important stuff. It’s easier to just leave everything up to you and try to cram as much of it into any one working period as possible. You already have all the resources you need. Plus getting others to help you in the decision making process only slows your business down. If you do it yourself you know it will be done right. The first time...probably the second...at the very least the third time. 

4. Lots of excuses and blame everything on externalities.

Everyone knows that building a business means you have to wear a lot of hats. Because of that there are going to be a lot of variables that you won’t have control over. Can you really be expected to predict what the entire economy is going to do? In dealing with problems and trying to get your business to grow be sure to make yourself look as positive and without responsibility as possible by framing that you are doing your very best and everything that goes wrong is out of your hands. 

5. Be unbending in your business's policies.

If you are a solopreneur that means sticking to the rules you created in dealing with all of the stakeholders you interact with. If you are a manager or a business owner with employees it means being unyielding in policy enforcement. The rules are there to keep order right?! If a business is to grow it has to be as strict as possible when dealing with customers, vendors, end users - they don’t know any better. Plus like I said already the economy is volatile and unpredictable so if you have an ironclad policy the business will always know the exact parameters of who it can interact with and how those interactions go down. Just because the culture of business is changing around us doesn’t mean you have to. If a party couldn’t abide by your policy then it probably wasn’t going to be a lucrative interaction. 

So there you have it! 

The 5 Ways To Ruin Your Credibility. If you are guilty of any of these I would encourage a hard look into what you are doing and how you are interacting with the communities around you. If you are indeed trying to ruin your business or reputation then I suggest you exercise these 5 tips every day. I hope you’re not though. It makes me sad to think that you might be. I’m even sad now even knowing that this is a bit of a parody, I'm sad thinking that out there right now are some businesses and people doing these things and thinking it's ok.

Are You Making Good Decisions In Your Business?

When you decided to give the whirlwind of entrepreneurship a try, you were probably making lots of hard and fast decisions in your business.

You had to right?!

In order to figure out if your business was worth pursuing you needed data and in the early stages making lots decisions and collecting any kind data about your audience or customers is critical.

The real question I want to get to the heart of today then is:

Are you now making good decisions in your business?

Or, have you found what feels like a rhythm but has revealed to be a rut? I bet I know why your business feels like it’s just spinning its wheels in place and before we dig in there is a quick disclaimer.

This is not an intellectual exercise in the different models of making decisions – it’s the real-time actionable decision making that I want to talk about.

Let’s really start by calling it like it is, you’re hoarding your freedom aren’t you?

Hoarding your freedom is when you value the ability to make choices so much that it actually prevents you from making any choices. It’s like the friend who never commits to anything because he or she is waiting to see if any better plans are happening. Hoarding the freedom to make choices is a terrible thing. You are constantly burying yourself in the extremes of opportunity costs and for good reason...so you think.

Resources are scarce even for businesses that seem to be thriving, that’s always a barrier you will bump up against. Making bad decisions and hoarding freedom of choice can actually do more damage to your business than making decently-informed-probably-not-perfect choices.

In as actionable and fluff free a way as possible let’s make you a more decisive and effective decision maker.

Before we get into the actionable bits let’s bust a few decision making fallacies. Fallacies are the things that will eat up lots of time, energy, and produce more stress than your body should probably be handling. I don’t have to tell you that making decisions isn’t always easy. Something I want you to keep in mind through all of this and to help get you out of the indecisive stupor is realistically thinking about the worst possible outcome. If you aren’t an evil scientist out of a comic book then accidentally blowing up the Earth is probably not an issue for you. So what’s the worst thing that can happen? Probably nothing you couldn’t bounce back from with a little extra work and maybe even a pivot in your business. What I’m getting at is that a bad choice is temporary – even when it feels like it’s not.

Fallacy Busting 101

First is the Information Mud Pit.

Feeling like you need as much information as possible from as many different experts, gurus and web-sites is like having your car stuck in the mud while you just hammer the accelerator. Sure it’s going to make lots of noise, throw lots of dirt around, and maybe even start to give you some forward motion but eventually you are just going to overheat your engine, breakdown and still be stuck. Don’t let your brain throttle about in the mud and then breakdown.  All those expert sources are just people and they may not be in exactly your situation.  Do those people have the same values, personal/professional experiences, or even biases that you do? Work on gathering enough information to cover any of the possible outcomes you can predict (there will be some you won’t be able to predict) and move from there. Just like getting out of the mud in your car it’s going to take a little patience, finesse, and the right tools. Not all the tools ever made – the same goes for research.

Next is being too busy.

Everyone is busy so that excuse can’t cut it anymore. What you are doing is finding new and different (read: easier) things to deal with that can give you some satisfaction from safe handling the things on your to-do list that can be completed with the least amount of energy and work. The other part of the being too busy is trying to multitask a little too much. When your attention is always diverted in lots of different directions the choices you make tend to be less informed, less qualified, less efficient, and just chock-full-of-mediocre. So no more excuses! They will just keep stressing you out as your list of decisions won’t be getting smaller.

The last fallacy I want to kick in the face is that you can’t get what you need done properly because there are always little fires that need your immediate attention.

The problem isn’t that you are constantly in a flurry of micro-emergencies it’s that you have failed to set your priorities. Decision making effectively takes a little work and a little prep time. It’s in the prep time that you should be stripping out your perceived opportunities for making decisions and reorganizing them in a way that reflects their relative importance. There is a lot of importance in building momentum in getting things done but you shouldn’t front load your decisions will all the easy stuff. You won’t be taking advantage of the momentum and flexing your decision making muscles the best way unless you prioritize.

Now that we busted a few fallacies let’s get to some action steps help make you a lean, mean decision making machine.

1. Are you actually making the decision? Sounds like a silly question to ask but it’s important to think about whom really has the final say. If you are a solopreneur it may very well be you. But are you part of a team or have a partner you have to run this by? Decide who is going to be making that decision and then move forward with purpose.

2. Set the stage. Very few decisions you make will only affect you. So it’s important to consider how your decision is going to affect the rest of your business and stakeholders. Make sure that everyone is comfortable with what’s going on and understands at least a few of the major consequences of those choices.

3. Make every decision (even the tiny ones) part of the big picture. Remember when you started your business you put a whole bunch of time and effort into your values and mission. Yeah, those still exist. So make sure that your decisions are in line with what you want your business to continue to be and to be perceived being. Everything from color pallets, paper supplies, and even how you package your product will all impact how your brand is perceived.

4. Do your research. At this point I would like to direct your attention up a few paragraphs to the part about hiding behind information.  You want to make sure that when you are making your considerations you are using good information. Good information in hopefully leads to good decisions out. Keep your information lean and relevant. What that means is that you do not necessarily need to be an expert on how paper products are manufactured and distributed to pick a new coffee cup vendor.

5. Consider solutions, side effects and possibilities. You want to make sure you try to anticipate as many probable outcomes as possible. It’s important to be aware of how your decisions will interact with the rest of your business environment. Your goal should be to get the most out of whatever your resources are all the time. That and making sure the different departments continue to play nice together to make your business perform as best it can.

Your business’ integrity is more than just making sure that all your decisions are in line with your business mission. It’s about allowing your customers and stakeholders to trust your business. It’s trust in you and your brand that will keep your customers coming back. You get to being a trusted resource by continuing to make decisions (for your offerings and how you manage your business) that continue to improve the experience for the customer and client. That includes how you manage your finances, how you handle bad customer experiences, and even how you choose to interact with your community.

Integrity Pro Tips:

1. Always do your best to meet your commitments – saying no is ok.

2. Treat everyone with respect that includes your competitors and even naysayers.

3. Always be honest. If a delivery is late, you’ve made an error, or shipped the wrong product out - your customers will always appreciate you being open and upfront. Their compassion and respect for you because of that honesty might actually surprise you.

How To Keep Track Of Money In Your Business

When was the last time you really looked at your finances? It’s tax season right now so I’m sure you’ve been a little extra sensitive about where your money is coming from and where it’s going but, checking your online statements from the bank or credit processing company does not count. 

Better question – are you still on pace to make/earn/generate whatever income you quoted for yourself in those initial projections in <insert time of start here>? 

Are you tracking everything or is it more of a check book balance ballet? The checkbook balance ballet is a display of grace, creativity and checkbook ninja’ing that makes you proud that you made it to the end of another month, quarter or even week.  

Last question I promise, do you actually understand how QuickBooks works or are you just winging it? I would rather hear that you are keeping track of expenses in a raw unedited list of an Excel file instead of winging it through QuickBooks. 

One of my favorite things to hear about a business’ finances is when I hear owners and entrepreneurs tell me they are too busy to worry about the minutiae details of the finances and that as long as there is cash in the register they are doing OK. 

Those individuals couldn’t be any more wrong. 

This post is aimed at being your businesses minimum viable finance fundamentals crash course and it is going to teach you how to organize and what to look for in your Income Statements (Profit/Loss) and your Statements of Cash Flows. These steps and tips will help you plan better so that you are spending better (read: more efficiently). It’s also a good idea to know when your endeavor is hemorrhaging resources so that you can do some entrepreneurial triage and get yourself back on track. 

Cash Flow Statement  

A Cash Flow Statement (CFS) measures the amount of cash and cash equivalents that are coming in and going out of your business. A CFS literally follows the money. No, your bank account statements, check register, or receipt tapes are not CFS’s. All the information that those sources and sources like that provide should be housed in one easy to find and easy to read place. Remember it’s all liquid resources, no Accounts Receivable or Accounts Payable here – just cold hard cash (flow). 

Here’s what cash flow will look like. First it starts with your cash on hand for the period you are measuring like days, weeks, months, quarters, etc. Then you should break it out into three big sections. Cash flows from operations, finance activity, and asset activities. Within each one of those sections you will be listing the cash-ins then cash-outs and a subtotal for each section. (Positive cash flow implies more cash in than cash out which is a good thing most of the time.)  Lastly you tally the three sections add in your beginning of period cash and what you are left with is your cash at the end of the period all nice and tidy right?! Not always. Now that you have an idea of what the statement will look like let’s break out those sections. 

Operations

This is the cash that comes in or goes out that is directly related to the core business operations. The biggest cash-in you will probably encounter is the income/revenue received from sales or services offered. After that common cash-outs will be stuff like: rent, utilities, payroll, and inventory. If the expenditure has anything to do with the core business operation and it was paid in cash it will be categorized under operations. 

Asset Activity (Economic Investment)

This is the cash flow activity surrounding bigger ticket items. These are things that would be categorized as plant, property or equipment. Let’s take a look at an example. Say you sold an old delivery van so that you could buy a new oven for your bakery. It would be a cash-in under Asset Activity for the sale of the delivery van and a cash-out for the purchase of the oven. If those were the only two transactions that period and you had cash left over you would have a positive cash balance in this section. 

Lastly is Finance Activity

This is the cash activity that relates to how you are using your money. If you took out a loan and have to make payments every month. That would be a cash-out. If you are an S-Corp or an LLC and you pay dividends or make disbursements to the shareholders that is a cash-out.  If you issued any stock or sold any bonds to raise money then those activities would be cash-ins. 

The goal for the CFS is to stack the information from period to period next to each other. You want to be able to look for trends, patterns, or things that are out of the ordinary. This will be able to help you find spots where you could potentially save money or give insight on where your money is going every month. One of the most popular things I hear from entrepreneurs is that they feel like they pour huge sums of money into their businesses and then look around and are unable to fathom where that money went. Your CFS will show you exactly where all that money went. 

Profit and Loss Statement/Income Statement  

An Income Statement or Profit and Loss Statement (P/L) is a financial statement that outlines your business’ revenue and measures it against your expenses. The goal is to find out how profitable your business is for that period and the periods to follow. It’s a crucial planning tool because it shows you exactly what your business is doing and whether or not you are sticking to the budgets you started your entrepreneurial adventure with. The P/L can also help you keep tabs on things like rates of product returns, and making sure that your costs to bring your product or service to market don’t get too out of control. This is different than the CFS because it takes your Accounts Receivables and Payables into consideration as well as a few other non-cash accounting measures like depreciation. 

There’s a little more involved with the P/L so let’s jump right into what goes into it. Then, we can talk a little more about how to use both of these statements to keep your business running like the well-oiled machine you thought it could be at the start. 

Net Sales

The net sales figure represents the amount of revenue or income generated by the business. The dollar figure recorded here is the total sales, less any product returns or sales discounts.  This is what you want to keep an eye on if you are starting to look at how fast your business is growing.

Cost of Goods Sold (COGS) 

This represents the costs directly associated with making or acquiring your products or services. Costs include materials purchased from suppliers used in the creation of your product, as well as any internal expenses directly expended. If you are a service based like a cleaning business costs might include the supplies used to get to the final deliverable. 

Gross profit

Gross profit comes from subtracting the cost of goods sold from net sales. It does not include any operating expenses or income taxes. Focusing on how much your Gross Profit is changing over time in its own amount as well as in relation to your Costs of Goods Sold can be important to follow. Financial goals can be to manage and maintain your gross profits as you scale your production up. 

Operating expenses

These are the everyday expenses incurred in the operation of your business. Some of these categories will even match some of the items in your CFS. In this sample, they are divided into two categories: fixed expenses and variable expenses. 

Payroll and Salary

These are the salaries, wages, and payroll plus bonuses and commissions paid to your staff. It’s for full time and part-time alike. 

General, Selling, and Administrative

This item is made up of all the direct and indirect selling expenses and the administrative expenses associated with being in business. These could be costs associated with advertising or marketing your products or services, travel, meals, equipment rental, and printing costs. It’s an umbrella for everything that’s not Operating, COGS, or Payroll.  
Rent: These are the fees incurred to rent or lease office or industrial space.
Utilities

These include costs for internet, cable, heating, air conditioning, electricity, phone equipment rental, and phone usage used in connection with your business. 
Depreciation

Depreciation is an annual expense that takes into account the loss in value of equipment used in your business. Examples of equipment that may be subject to depreciation include copiers, computers, printers, and fax machines.
Miscellaneous Expenses

Expense items that do not fall into other categories or cannot be clearly associated with a particular product or function are considered to be other overhead costs. These types of expenses may include insurance, office supplies, or cleaning services. It is crucial that you outline each of these costs as sub-items below this heading. 
Total expenses

This is the summation of all expenses incurred in running your business. It does not include any taxes or interest expense on interest income if there is any.

<Take a breath> A little recap. 

If you are following along, you have outlined the quantity of sales that have come in. Then you subtract away the cost of making the sales to get to Gross Profit. Then you subtract away all the rest of the expenses and costs of doing business in general and that leaves you with another magic number – Net Income Before Taxes. This, like Gross Profit, is another place you want to keep an eye one. An example of something that you may encounter is your Gross Profit is increasing but your Net Income Before Taxes is staying the same or getting worse. Big Red Flag! When you see that it’s time to get back into those expenses and CFS for the period and investigate where all your potential profit is going. Ok, on we go…

Net Income Before Taxes

This number represents the amount of income earned by a business prior to paying income taxes.  I had to state it like this just for the sake of good form. 

Taxes

This is the amount of income taxes you owe to the federal government and, if applicable, state and local government taxes. Pro Tip: Don’t sleep on your taxes. I’ve seen instances where the IRS can and will issue liens on bank accounts. That makes operating your business very tricky if you don’t have access to your accounts. It makes paying employees even trickier. Stay on top of your reporting or get some help with it. The IRS aren’t the bad guys (not all the time anyway) and they are willing to work with you but you have to have your act together. 

Net income

This is the amount of money the business has earned after all your expenses, interest payments and paying income taxes. This is wrongfully the first place a lot of businesses look to figure out the health of the business. Don’t let this be you. It’s also easy to see extra money and just put it in your pocket – also a bad idea. You have to evaluate the opportunity costs of using that Net Income in a variety of ways. Sure your pocket is one way but so is reinvestment, increasing the pay of your employees, paying down and debt more rapidly, or just saving it for a rainy day. 

Lastly if it’s negative then you definitely need to dig back into these financial statements and figure out where your resources are going as well as ways to increases those sales numbers at the top. I don’t want to spend too much more time in these statements though – think of this as a reawakening to your financial management responsibilities. Let’s get into some metrics you can use to gage the health of your business without worrying about flipping through each line item of each statement.

You may have noticed that there was no talk of the Balance Sheet. Not because you shouldn’t like or care for the balance sheet but because when you are in the trenches and trying to make changes on the fly you will need the most up to date information possible. You are going to want to keep an eye on the speed at which money is coming in and out of your situation. The Balance Sheet is more of a long term snapshot. Just like with the P/L and the CFS, there is a template for the Balance Sheet and some information on Balance Sheets in the Resource Section at the end of this book. 

On to the ratios. 

The two types of ratios that are really important for figuring where you stand and how to plan are efficiency ratios and liquidity ratios. How this is going to go is I will give you a brief description and then the ratio. The idea is that you start using these ratios to not only track your own progress but that of your industry. You can get some industry ratios from places like census.gov and others by doing simple searches in Google. 

Quick Ratio

Is a measure of a company’s ability to handle debt if it needed to, or its short term liquidity. The higher the ratio the more liquid the firm - which is a good thing. 
= Current Assets - Inventory/Current Liabilities
Debt to Equity Ratio 

This measures your leverage. It’s how much debt have you used to help your company grow. Having and managing debt can be a good or a bad thing depending on how you handle it. The important thing is keep track of what the ratio is doing over time as well how you servicing your debt. More debt might not always mean more growth. 
= Total Liabilities/Owners Equity 

Interest Coverage Ratio

This is an interesting one. In the planning process it’s easy to get caught up in showing that you can cover and debt that will be issued. It’s equally, if not more, important to make sure that you can cover the interest payments that go along with that debt. Here the rule is a ratio of 1 or more means you can service all your obligatory interest. 
= Operating Profit/Interest Payment

Collection Period

This ratio will help you keep track of how long it takes clients or customers to pay. The longer the period the more working capital you may need to support your business while waiting for payment. Remember efficient businesses don’t really use much extra cash. It can also help keep your payment policies tracked and enforced. 
= Ending Accounts Receivable/ Revenue per Day

Lastly ROA and ROE

Both of these ratios will help you get a sense of how much return you are getting out of your Assets (A) and your Owners Equity (E). As you keep track of this you will be able to see how capital expenditures are affecting your bottom line or if you are really using everything you have to it’s best potential. Having the money to buy stuff is great but buying stuff alone is not going to make you money. You need to manage the stuff and the people in charge of that stuff appropriately. 
= Net Profits/Assets and Net Profits or/Owner's Equity

Now this is not the conclusive list. These are a few key ratios you should start with when you are snapping out of the entrepreneurial honeymoon. From here it will help you to pick the spots in your financials that you want to focus on and work on to make stronger. These are some of the ratios that can help you see patterns for better or worse before the raw data might indicate. The statements these variables come from also vary in length and complexity. You need to keep on top of this so that you can confidently focus more time on doing the work that matters most to the people you serve. 

Otherwise, you might not be in business for as long as you planned. #moneymatters

How To Keep In Touch With Your Customers

In this post I want you to think about the people that buy from you.  If you're just starting out or are restarting don't fret, this post is also for you.  The questions I challenge you to think about are:

How are you keeping in touch with your customers?

Are you getting regular and timely information out to your customers that’s relevant to their experience – like impromptu closings?

Are you engaging in a way that is more than the traditional marketing touch points?

More than just flyers, coupons, surveys, and talking to the customer on the way out?

More than TV/Radio commercials, possible news interviews, and even the occasional hosted special event?  

You will move yourself to the back of the memory-and-relevance-bus because your customers, even your best customers, aren't connecting with your brand outside of the basic exchange of goods and services for money experience. If you settle for just a basic vendor experience you will only be relevant in your stakeholders mind when your offering satisfies their need – not bad but you should be striving for more.

The type of business you run doesn’t matter when it comes to staying in touch with the people that support you. You are just creating excuses if you can’t engage with your customers because you’re a small restaurant, café, bookstore, pet walker, or even an electrician. The idea is that you can always provide value for people and establish yourself as a resource wherever your customer is in the buying cycle.

“I am already getting the sale. Why do I need to engage them? Isn’t the fact that they bought from me and will possibly continue to buy from enough? “

Short answer is no. Longer answer is nooooooooooooo!

A report put out by Bain & Company in 2011 reported that customers that engage with brands regularly spend a lot more money in those businesses. That is to say that customers that have meaningful engagement, above and beyond your traditional marketing touch points, reported increases in revenue between 20%-40%. That’s huge if you want to keep your business growing. Not only that, the reach grows exponentially as more and more people see your customers engaging with you in a very public way.

I can already feel your eyes starting to waver because you know what’s coming next.

Social.

Social Media, every business guru’s favorite topic. Maybe you’ve found some success or maybe it’s been a huge waste of time. Either way you have set up your accounts and get to it when you have the time. Most likely, and sadly, only if you have something to announce to your followers. Stepping up on your social soapbox to only announce when things are happening for you is not a great use of resources. You won't be able to cut through the noise.

My personal favorite social media faux pas is logging into Facebook and by the time you walk away from it two hours have elapsed – I call this “social media time traveling”. This is not a full on tutorial about social media and you should use whatever platform works best for you to engage with your customers. This post is about getting to the heart of what you are going to do to create some benchmarks to measure yourself against and some concepts to put into practice.

Here’s the plan for kicking up your customer engagement and ultimately kick up those revenues.

1.    Decide what you are measuring when you start a campaign.

Are you trying to grow by acquiring email addresses to market to later? Is your goal just to spread awareness? To get people to talk to you? Then track those Facebook comments. (Be wary of “Likes”, more doesn’t mean that it is a reflection of authentic engagement)

2.    Come to terms that engaging with customers is going to come in a full range of experiences.

It’s going to take work and it should feel like you are having a conversation with your audience. Think about your favorite YouTube channels – odds are they make you feel like you are part of their community every time you watch their shows.  This also means you have to be an amazing listener. You need to be able to understand their needs and wants just as well as what gets them excited and is interesting to them.

3.    Mobile is only getting bigger.

You don’t have to go out and create a new app (unless you want to) but whatever medium you use should be mobile friendly. Facebook groups, Twitter, and even Instagram are checked every minute of every hour so make sure you are reaching out with value and not spam.

4.    Everyone needs to benefit. Remember your customers or potential customers are always going to be looking for value.

So you need to do more than just spam your happenings. Find things that your customers can relate to outside of your product or service and spread the love.

5.    Listening is the opposite of just constantly shouting at your audience.

Listening is about trying to keep people talking to you after the sale. It’s about collecting information about your user’s experiences (great and not so great) and about showing them that you are making real efforts to take that information and improve the experience. 

Lastly, stand for something that’s more than your sales. Get involved in your community and get to know people in a way that has nothing to do with selling to them. Engaging your customer and being a resource for them outside of the sales cycle will keep you in their conversations beyond the immediate need you serve.

Remember: 

“Profit in business comes from repeat customers, customers that boast about your project or service, and that bring friends with them.”

-   W. Edwards Deming

How to Get More Done In Your Business

Don't get stuck staring at the loading screen in your business. 

Don't get stuck staring at the loading screen in your business. 

There are lots of ways you can organize, operate and deliver value as a business. You can be an independent online business, an Amazon seller, a cooperatively owned farm, a brick and mortar restaurant, or a residential cleaning company to name a few. If you can identify a problem and offer a solution that people are willing and able to pay for, you have yourself a business. Even though businesses come in all shapes and sizes, for all the different problem-seekers and solution-offerers that exist there is something that connects them all.

That common thread that ties all of these business together is the drive to produce the best quality product, service, or experience using as few resources for as much profit as possible.

That was a mouthful.

Yes sustainability, honoring mission, and providing value are also big drivers for business but to keep operating, on average, it takes bringing dollars in the door. Then using those dollars in the best way you possibly can to continue to bring the next dollars through the door.

This post is going to provide you with some tools to help make sure you are being as efficient as possible.

Start by segmenting each department or operational area of your business into projects. Boil everything down to the most basic functions in the business. Making something simple but not simpler should be reminiscent of methodically putting together your childhood science fair projects or at least putting together IKEA furniture (way more fun than the furniture though). The term we use to describe this process is Project Management. Project Management is all about planning, organizing, monitoring, and allocating resources to successfully complete a specific outcome.

Operationally, most businesses are made up of lots of projects – some short term and some long term.  Take this process and adjust it so that it best works for you – here is your crash course in project management.

1. Start with the cash flow. More specifically where cash is going and how it is being used in your business. Some easy ways to bring these costs down are to re-evaluate your shipping costs, credit card processing and insurance or liability needs.

2. Manage your businesses schedule. One of the biggest drains on resources and reason businesses hemorrhage money is over-staffing.  If you are a one person operation, audit your time hour by hour to see where you get the most return on your time. If you have employees it means possibly trimming those hours. Are you paying the right people to do the right job?

3. Plan how your product or service goes from client engagement to final delivery and map out all the costs and tasks along the way.

If this is feeling a little overwhelming try breaking down each department or group of related activities and treat them like individual projects. Then find the goal of each project by asking:

1. Does this department or group of activities have specific or measurable goals? What are they?

2. Does this department (now project) contain all the related tasks to reach those goals?

3. Is there a clear start and end point in the process?

4.Is this so important or different that it needs to remain a standalone project? If not where can I combine these activities to be more efficient?  

Now you have your project defined and it’s time to set it up.  Here is a format to help you define what you need within each component of your business. It’s called the Triple Constraint:

1. Time Constraint: When does the outcome need to occur or is required?

2. Budget Constraint: What funds or resources are available to get the desired outcome?

3. Performance Criteria: Are there any barriers or quality issues related to producing the outcome.

For each project set up charts to track progress and measure from week to week, month to month and quarter to quarter.

Here is a personal example –

Sometimes, I hate doing the administrative work associated with running my consulting business. I wish I could just spend my days talking to people and lecturing to my students. But, invoices need to be sent out. So I have set up some constraints for the A/R or Invoicing Project in my business. This will ensure that I utilize my resources as efficiently as possible. For my time constraint I block off a chunk of time on Monday’s biweekly to go over and review invoices that need to be sent out. I physically and mentally limit myself to 1.5 hours maximum in dealing with this. If it needs to take longer I’ll pick another favorable time and do it then. My time, like yours, is important and after 1.5 hours I probably need to be somewhere else.

Budget Constraints are interesting for me. I tend to be a softy when it comes to invoicing and each week give myself an allowance for discounting. That’s part of the budget as well as the monthly fee I pay for Freshbooks, my invoicing and financial management service. Freshbooks is where I keep a good chunk of my client invoicing and billing information and is something I highly recommend to everyone.

That leaves me with quantifying and measuring performance. For my invoicing project this gives me the opportunity to see my billable hours or any other client services and measure them against the past. I can see how many invoice related communications are sent, follow up with old invoices as well as send out new ones. It also gives me the opportunity to review for errors or test new tactics to try to get my invoices paid faster and more accurately.

A real life fumble on my part was leaving the wrong mailing address on my invoice and losing out on a client’s payment for over a quarter – that’s how long it took for the Post Office to get the client's letter back to them. Quality of information and process is super important – otherwise you end up like I did and carry an opportunity cost on receiving that late payment.

Now it’s your turn. Start small and try to build momentum by breaking down one of the things you need to get done in your business into a single project. It’s not going to be perfect but taking the time to break down what really needs to get done, how to measure success and how to build systems around the stuff that you can. Taking the time to do this work will also help you get out of your own way so that you can do more of the work that matters to you and to your business.

Why Blue Oceans Matter In Your Business

Blue Ocean Strategy is one of the business buzzwordy concepts that’s actually worth knowing about if you’re trying to authentically bring your business into the world. Its a methodology and planning process that was penned and cultivated in a book, Blue Ocean Strategy, by a couple of strategists and professors from INSEAD (international business school) by the names of W.Chan Kim and Renee Mauborgne. They combed through mountains of strategic decisions made by firms over the last century and boiled them down into a strategic framework that you can use to help better position your business.

It’s an awesome idea and a great way to visualize how your business is making strategic decisions.

At the heart of it, Blue Ocean Strategy is all about finding the open and untapped waters of your market. You are literally looking for either new markets or under-served markets that you can pivot your business into and hopefully capture.

To quote one of my favorite authors and TED Talk speakers Malcolm Gladwell - you are giving your market some “extra chunky” (Here’s the TED Talk if you’re curious but make sure you come back!)

What this blog post is going to do is break out the major concepts of the Blue Ocean Strategy framework. This is not so much a review of the book but it will hopefully help you getting into a mindset that helps you find ways that you can differentiate and find a competitive space. That new mindset will give you the opportunity to offer a very specific and niche value.

The first big concept in Blue Ocean Strategy is working on Value Innovation. Value Innovation is not an easy thing to pull off as it’s simultaneously finding ways to offer more value while lower costs. One tools that you can use to help find your Value Innovation is something Blue Ocean Strategy calls the Eliminating-Reducing-Raising-Creating Grid. This grid is a tool to help you organize your business so that you can flush out where you can differentiate against other businesses in your industry. You are listing the factors in your business that follow the prompts in the grid and taking a strategic look at what’s happening outside of your business.

After you work on ways that you might be able to find your Value Innovations there is a four principle framework that will help streamline your strategy process. These principles will help you focus the factors you flushed out and really hone in on how you can position your business so that you are serving your own blue ocean.

1. Rethink your market boundaries.

Where can you create an uncontested (low competition) market? It’s not always easy to move away from trying to make your slice of the pie bigger and work on baking an entirely bigger pie. There’s no reason you can’t go out and redefine who your market is.

2. Think of the big picture.

Everything is variable in the long term so you need to think about what your business might look like a few years down the road. It will help in the planning process in the short term if you have an idea of the culture, processes, and value you want to offer in long term. Everyone wants profit so don’t just try to plan for that - this process will blow up in your face.

3. There’s always a little risk in this but you have to start thinking about offering value beyond what your customers think they need.

You are in business to provide a solution to a particular problem or set of problems. To find your blue ocean you have to try to get your finger on the pulse of the next set of needs your customers are going to have. How can you add value to what you are already doing so that your offerings are so full of value that you can’t possibly be substituted out.

4. Get your strategic sequence right.

This is not an overly complex sequence and it’s really powerful. It’s three big questions and if you are unsure or answer “no” to any of them you have to go back and rethink it through. The first is, are you offering the most value as possible, economists would call this utility? After that is the price you are asking aligned with your product or service for your market? Lastly, can you produce it at low enough costs to get to the profit goals you have set up for yourself and the business?

The last part of the Blue Ocean Strategy has to do with how you execute and implement. It relies on and utilizes tipping point point leadership and the development of fair processes. To boil those into the most actionable and digestible nuggets possible you should be thinking about how you can ignite the values and beliefs of your stakeholders and use passion to ultimately spread strategy. You get to leading with passion and conviction through trust. That’s where fair processes come in.

Fair processes happen when your stakeholders, employees, or partners trust that you will make the right decisions in terms of moving the business forward. What are the things that you can do to show the people that rely on you that you deserve their trust and have the compassion and drive to move your strategy forward.

Blue Ocean Strategy is a really robust framework and it would definitely take more than just one blog post to really do it justice. My hopes here were to present you with a different way to think about how you are bringing your strategy to life. How can you infuse a little Value Innovation, tipping point leadership, fair practice, and the four principles above into what you are doing everyday to push your business forward.

4 Strategy Mistakes To Avoid

We all make mistakes in our businesses - no surprise revelation bomb there.

Part of growing a business is constantly learning from past decisions. It’s about getting savvier about the information you collect so you can continue to serve your market well. Making mistakes in your business isn’t inherently bad though. It provides an opportunity to collect feedback, to adjust a product or service, or to get your business back in line with its values and mission.

Making mistakes gets to be bad for your business when they are constantly costing you dollars, goodwill and market share. Making lots of mistakes makes it harder for your customers to know, like, and trust the experience you are offering.

I can’t stop you from making mistakes in the future (I wish I could do that for me!) but, I can give you a little insight around the most common mistakes businesses make in terms of strategy. This post is going to walk you through some of the most common strategy mistakes and how to avoid them. My goal is to have you evaluate your entrepreneurial efforts and be able to actively recognize falling into any of these strategy blunders.

When you can see a strategy mistake coming you can work smarter to correct it and continue to move your business in the direction you want.

Common Strategy Mistakes

1. No strategy at all.

This is number 1 on the list for a reason. Having no strategy is the worst mistake you can make in your business.

Why?

No strategy means you are just arbitrarily making decisions about how you are bringing value to your customers and how you are deciding how to spend your time, money, or effort. It also means that you are only measuring broad business performance indicators like “sales” or “revenue”. Using those measure isn’t bad but when you aren’t measuring them for any part This is the same thing as hearing someone say that their strategy is, “to be the best”. It sends shivers down my spine.

When you have no strategy you allow your business to be subject to the ebbs and flows of every single consumer and you run the risk of wasting resources. How can you be competitive if you aren’t working on getting the most value out of your own time, money, or effort?

2. Getting your business or industry wrong.

As an entrepreneur you are probably really close to the work that you do. That’s awesome because that means you are committed to deliver as much value as possible! That makes defining the market you actually serve hard to identify - especially when every resource you read talks about the importance of identifying your perfect niche.

It’s important to take a step back and look at the market you serve in terms of the alternative choices your consumers have to engaging with your business. Here’s an example: if you are in the “paint and sip” business you aren’t just competing against other “paint and sip” businesses you are competing for all entertainment dollars. Consumers that spend $25 - $45 per ticket per person could also spend that money on: dinner and drinks, taking in a live show, going to an IMAX 3D movie, etc.

Being able to communicate your value and create strategies that will help you capture those entertainment dollars is what you should be focusing on - not what you think you direct competitor is doing (at least not all the time).

3. Are your strengths really your strengths.

Generally businesses fall into one of two buckets. They are either awesome at delivering the best experience possible for their customer or they are really great at delivering value as efficiently as possible. All businesses have to do a little bit of both but there are only so many resources that get to be divided up during the day.

You can’t focus all your effort on your customers and all your effort on being as efficient and as effective as possible. You can’t be all things to all stakeholders so you have to objectively evaluate your business and pick out your strongest capabilities. You can’t have competitive advantage if you are trying to be the best at everything all the time. Also if you still think, “trying to be the best” is strategy please go back and read the first point.

4. Listening to all your customers.

Feedback is an amazing tool for helping you and your business be as valuable as you possibly can. Making constant changes based on all the different feedback you are getting will wreak havoc on your business and on your strategy. Strategy, and your business, shouldn’t be about making everyone happy. Your business will find its best successes by choosing a very deliberate market to serve and then committing to serving that market well.

It’s really easy to get distracted when it comes to strategy because the allure of doing more to appeal to more with the hopes of earning more is a hard bias to shake. Lastly, if you are listening to every customer all the time how will you really be able to test anything in your business. It takes time to build interest and to get people to know, like and trust you.

Constantly changing parts of your business can send an inconsistent message to your customers - which does not bode well for building loyalty and advocacy.


Creating strategy and communicating it well throughout your business is hard enough already. Don’t make it harder by making these mistakes!

5 Tools I Use To Grow My Business

Welcome to 2017!

I know that today is the observed holiday but I couldn’t help myself, I had to get to my desk and get started. I had a little extra spring in my step as I made my way to the office this morning because I was excited to answer a question that I get all the time from entrepreneurs and business builders. That question:

How do you keep your business going and get everything you need to do done when you’re a small team or even just a team of one?

I know a lot of you out there have set goals, resolutions or even just intentions for your businesses this year and I want to continue to support you in reaching those goals in any way that I can. So, I’m going to peel the curtain back a bit on my business and talk about the five resources I use to keep me moving forward in my business that you can use too.

Again to be super clear, these are tools that I use everyday and that I tell people about when they ask. None of the links I’m sharing are affiliate or paid  for in any way, just pointing you to where you can learn more.

1. Evernote -  https://evernote.com/

There are a ton of posts and articles on the internet that talk about the greatness of Evernote. I don’t want to bore you with another review. What I want to do is talk about how practical and essential this app is for me, and could be for you, every week. One of the necessary evils of growing a business is that you’re going to take and host meetings. Some of them will be amazing like, meeting with clients if you are a coach or consultant and some of them will be less amazing like, meeting someone for a “networking” coffee only to have them try to pitch you the whole time on a service you don’t need. Recording your thoughts, conversations and follow up actions in a way that’s easily organizable, time stamped and searchable is huge. For me this app is more than just a place to write ideas to go back to at a later date they are repositories for business development information I use everyday. I track client conversations, write my blog posts and use them as a home base for the projects I need to keep track of in my business. Plus with the premium you can make documents, pictures you take, scans, etc searchable - how cool is that!

2. Hubspot Sales - https://www.hubspot.com/products/sales

Building a business probably means that you are sending a ton of emails out everyday. I know it can be really frustrating to send them out and then just wait. Not really sure if your emails landed where they were intended or if they were read at all. With Hubspot Sales you can send your emails out and actually see if/when they get opened and even track click throughs. It’s a little sneaky but I love it and I think you will too. Hubspot also has a decent CRM to help keep your prospects and sales pipeline organized. It’s also got a really neat Google Chrome and GMail extensions that will push you notifications so you don’t have to keep checking in on the app/site. The free version gets you up to 250 open notifications per month and then you can upgrade from there. If you rely on email for the bulk of your business development then something like this can be really helpful because you can better time and position your follow up emails or the other steps in your sales pipeline.

3. Buffer - https://buffer.com/

There are a lot of social media aggregators and planners out there today. Buffer is one that I started using when they were pretty young and have grown with them. Buffer is a huge resource for me because it helps me plan my social content for the day or week. You can set the share frequencies, choose how you want links to show up and it gives you decent analytics. If you are a small team or a team of one then you know how tough it can be to prioritize being active in social and balancing everything else you need to get done in a day. While there is NO SUBSTITUTE for real interactions you can plan the things you want to share and then carve out smaller chunks of time to go out into the web and be a real person. Social moves fast and is still a really relevant place to be. Buffer makes it easy to keep your face showing up in people’s feeds. The free version lets you plan 10 social posts I believe and then you pay up from there.

4. Any.do/Cal - http://www.any.do/

Any.do and Cal are sister apps that live on your phone and the web. It’s a to-do and calendar duo that helps extend the functionality of what a calendar app like Google Calendar can do when you’re trying to fit in all the little stuff that needs to get done in a day that doesn't really need a full on calendar entry. I love Any.do because you can create all kinds of categories and reminders that will integrate well with the calendar. You can save files, set location based  reminders and all kinds of other neat customizations. Cal also pulls the data from your Google Calendar in so you can keep everything really organized and in one place. It’s really intuitive which is important for me because it means it’s easy to edit, check off and adjust on the fly. There is a free version but for $26.99 for the year you get all kinds of goodies including one of my favorites is a prompt everyday to plan my day.

5. Trello - https://trello.com/

I love Trello because it can be whatever you need it to be. It can be a project manager, an extension of your to-do list or even a place to host processes that you create for your business. In Trello you create “boards” and within the board you can break them out into actions, sub-actions, leave notes, assign people and even store documents. Because I use Any.do for my main to-do list and planning I use Trello more for creating project management timelines and benchmarks. It’s great for taking big ideas and them breaking them down so that you can actually get work done. I use it as a place to keep my vanilla processes too. I can create step by step outlines for things like New Client On-boarding and even Blog Posts. Trello saves time and creates consistency for my workflow because all that information is in one place and contains processes that I use all the time. It’s also really good for small teams that need a place to collaborate and communicate through the work process. It also integrates with a TON of stuff like all-things-Google, Dropbox, Slack and all the Evernote. (I’m big on stuff that plays nicely together.)

That it!

Those are the five tools or resources that I use everyday in my business. They help me stay organized, keep track of what I have going on and keep me doing work that is pushing my business forward. I believe they can do the same thing for you. There’s a catch though, these resources are not silver bullets. They aren't going to do your work for you but they will help keep you organized and help you set finish lines up for yourself. That’s really important because in order to make progress in your business you have to be able to start something, finish it and move on to the next thing. So often I see people stuck in this quagmire of tasks they are always working on and never create the momentum they need to really grow because they are stuck always working in their business.

Take some time, set them up and then get to work trusting that your systems will support you along the way. Your business at the end of 2017 will thank you for it.

4 Ways To Start The New Year Off Right

For the last post of 2016 on the Disruptive Strategy Co. Blog I’m shooting for a callback to the blogs of yesteryear. (For those that don’t remember yesteryear, it was a Wednesday and I mean the cool thing blogs did from 2000’s to about 2013.) Today’s post is a round-up of posts/articles that I think are really useful in helping you kick 2017 off right. There’s a ton of great stuff out there about business development, goal setting and entrepreneurship so rather than adding more to the pile I thought I would help you spend less time searching for what to do next and more time taking action.

Plus, I mean, there are only so many articles you can read about planning before you are essentially numb to all things New Year Resolutions so hopefully this list mixes it up for you.

Below are four posts/articles from across the web that I believe are worth your time and that if executed on will help you get farther than anyone else inspired by the New Year. (The links to the articles are in the sub-headings.)

1. 7 Steps to Achieving Any Goal in Life - Entrepreneur

This is a great article because creating SMART goals get’s a lot of lip service but not in a really useful way. Let me explain. SMART goals: specific, measurable, achievable, relevant, and time-bound goals are easy enough to understand conceptually for people. That’s usually as far as most people get in trying to set goals. They understand that this is an important framework but often overestimate their own abilities and set expectations so high that the goals they set get abandoned. This article makes SMART goals SMARTER by adding a few extra letters to help keep you on track and actually achieving your goals. The E gives you the opportunity to evaluate your progress along the way, acknowledging that goal setting is more than just a two step process - set and achieve. The R gives you permission to re-adjust because life isn’t always as easy or predictable as you think it’s going to be. If you’re setting goals this week this post is a great way to help frame what you’re working towards.

2. 6 Ways Work Environment Shapes Your Productivity - Fizzle

In this podcast the folks at Fizzle talk about how where you work impacts the quality of that work. You might not think about it but, your environment plays a big part in the amount of stuff you get done in a day. If you’re looking to start the New Year off with a productivity sprint then you should definitely give this a listen. (I think they are the perfect blend of entertaining, engaging and instructive.) They talk about the importance of separation, making changes, organizing your browsers, ergonomics, clutter and lighting. Take control of your space to get better results with this podcast.

3. Forget the Resolutions - Write Your Personal Manifesto - Strategy + Business

This one is for those of you that have plans of continuing to take action long after the January New Year Resolution Honeymoon phase passes. It’s also not a “quick” exercise. Going through this process if going to take time but it’s going to help you find the warm squishy core of what’s important to you and bring it up to the surface so that you can keep it top of mind. This manifesto that you build for yourself is going to help you stay motivated and fuel you when it feels like the hits from 2016 are continuing to push their way into 2017. (RIP George Michael)

4. How to Create a Social Media Content Calendar for a Year - Social Media Examiner

Whether you’re a small business, a corporate ninja, a weekend warrior or a person with an internet connection you need a social media planning tool to help you avoid being “that” person that shares a little too much in their feeds. If building a brand is important for you in 2017 then you’ll want to make sure that you’re giving your audiences the quality and consistency that will keep them coming back every day/week/month. This post will walk you through creating an excel calendar that works in holidays and lets you see how your content maps out thematically throughout the year. If you’re serious about going pro in the New Year you have to stop winging it. Winging it takes time and attention that you need to be investing in the value you are delivering.

Bonus (Video) Post

5. Shia LaBeouf “Just Do It” - YouTube

“If you’re tired of starting over, stop giving up.” That is my favorite quote from this one minute video. I know that this was one of the biggest memes of 2016 but at it’s core he’s right about a few things when it comes to motivation and getting stuff done. Everyone needs a little jumpstart now and then and while there’s no direct takeaways from this maybe Shia’s message will give you the boost you need to take massive action.

I hope that you make the most out of this “dead week”. 2017 is essentially here and I hope that I’ve saved you some search time so that you can start to dig into the work that matters. See you in 2017!

Oh and...

JUST DO IT!

(Sorry couldn’t help myself.)

Your Strategy Is Not Your Mission Statement

Your strategy is not your business's mission and it’s not your values.

Those types of business development concepts help to shape business strategy but, they are not themselves your strategy. The choices you make around things like who your customers are and are not, that’s strategy. The markets you choose to participate in, that’s strategy. Lastly how you are going to provide so much value that you can’t be ignored, that’s strategy.

Strategy has to (at least in the beginning) be deliberate.

When there is a disconnect between your strategy and what’s going on in your market you end up with a growth problem. The growth problem is your inability to take the actions you need to take to go out and get the right kinds of customers for your business. You start chasing everyone in the hopes of improving top line revenue.

Yes, there is a wrong kind of customer.

As an entrepreneur you have to deliberately choose how you are going to try to get new customers, measure  your efforts as you attempt to land those customers and continue to develop how you communicate to your customers. If it feels like a lot it’s probably because your strategy and the behaviors/systems you have in place to grow your business are misaligned.

Let’s start aligning.

Growing your business in a way that supports your mission and vision is what, in my opinion, most independent businesses want. You want to feel good as you’re growing your business. You have to move beyond just looking for those good feelings and clearly identify:

1. The specific need you provide for.

2. The specific customer you provide for.

3. Communicated (sold) in a way that is most responsive to your specific customer.

4. Continue to learn and develop your skills as a business developer.

Notice that none of those points have anything to do with mission or vision. Your mission is why you are doing what you do as an entrepreneur. It’s your motivation. Your strategy and business development behaviors are your how. Both of those need to be on the same page to be most effective.

Think about any high end ultra-premium car. Do they try to sell to anyone who may be in the market for a car? No! They are trying to appeal to a very specific kind of buyer. Their strategy to do so is perfectly aligned with their sales behaviors. The result? A market that will healthily bear the sales of the Ferrari 488 GTB starting at $249,150.

Sounds simple when you read it, right?! At the core of aligning your strategy and your business growth is your behavior. Are the sales behaviors and sales tasks you create in your business reflective of your ideal customers and market? Or, are you just out there selling to anyone that is willing to listen or read?

Everyday you are going to run into changes in your customer’s tastes and expectations. Technology will change. Culture changes and markets evolve. Your sales and growth behaviors need to adapt with the changes that are happening around you. If you have a clear strategy that you revisit often it will be easier to keep the integrity of your mission or vision. You’ll be constantly working at it and responding to change almost as quickly as it happens.

This is my challenge to you as the year comes to an end.

Think about how you are currently trying to find growth for your business. Do your day to day sales activities align with your business’ strategy? If they don’t you should really spend some time to get clear on the value you offer and to whom you offer it. Then build your strategy and sales activities from there.

How To Get The Most Out Of Your Annual Review And Planning

A lot of people think that this is the time of the year when stuff starts to slow down in their businesses. I get it. Lot’s of decorating, holiday traffic messes and shopping to be experienced. I think the exact opposite though. Well, not about the fun holiday stuff but about what the end of the year means for your business. When it comes to what you’re doing in your business and planning for it’s definitely go-time.

Getting your team or even just your thoughts together for an annual planning process is an awesome thing to do this time of year. It helps flush out new ideas, figure out what works, and gets your business to the starting position for 2017. I know it might feel like extra work but you’re already tidying up your business for year end so, you might as well sneak in a post-mortem while the environment is right.

Speaking from personal experience, it’s not always sunshine and rainbows to go through a process like this but it is worth it. It’s an opportunity to shine a bright light on the things that worked (and maybe didn’t work) so you’re 2017 doesn’t look like this again: 

I hope I didn't lose you after that clip!

Below you will find a few pitfalls to avoid and some helpful tips on making your planning and review process as effective as possible.

1. Avoid only planning for big benchmarks and outcomes.

Planning for big moments to hit in your business is more bad than good. It’s great because it gives you something to aspire too. It’s awful because you will probably do nothing until a week before the deadline and then spend a crazy amount of time and energy in underachieving and successfully burning yourself out. Instead focus on behavior, actions, or even the development of systems that will continue to push your business forward. Outcomes are great to keep in mind or even to plan to get to - but the point is that you have small chunks of actions in almost 2 week increments to help guide you to get to your big outcomes. It’s OK if you don’t make it too - make this year the year of adaptation and the art of the pivot!

2. Not everything needs a revamp.

All too often I see businesses chalk up last year as a loss and to decide to take a fresh look on  EVERYTHING. Stop it! When evaluating the previous year make sure you try to find and focus on things that worked. Think about the time and energy it will take to change everything, not to mention that it will be a totally untested set of processes. It’s ok to want to do better and to try to adjust to make up for lost time, money or opportunity. Just make sure if you are revamping anything you are setting up some way to measure those changes. Another crazy idea, do more of the things that worked great! Make sure you are rewarding team members, customers, and even well-wishing-supporters along the way.

3. Don’t just ask people for their opinions.

If you are part of a team that’s bigger than you it’s important to get feedback. Critical and objective feedback. The kind of feedback that takes time to prepare in advance. Just shotgunning a meeting and asking people on the spot about their experiences creates awkward social interactions, non-honesty, and feedback that’s not filtered as clearly as it could be. Give your people a heads up and give them specific items to bring to the table - play to your team's strengths! Everyone that’s sitting at your meeting table is a rockstar and will add value to the coming year’s plan if you create an environment for them to be successful. If you are a solopreneur you should set separate chunks of time to tackle specific issues. Trying to do it all in one sitting is a recipe for missed opportunity and will leave you mired in “should haves” and “could haves.”

4. Your annual plan should have things that people not only can do but will continue to do in the following weeks.

Annual plans are like New Year’s Resolutions in that if you don’t make them well you won’t follow them after the 10th or so of January. Focus on changing behavior and worry about the attitude or mindset later. So piggybacking off of an earlier point create actions that your team or you can work into your schedule every day that is not just extra work! Extra work gets left behind for what people perceive is more important and no one wants to try to operate by a plan that they aren’t connected to on some level.

We are still in the pre-2017 window. If you’re still batting around the idea of an annual plan make your way through these steps and get all your stakeholders on board. It will make for a more meaningful plan and one that you get to review in its entirety come 2017.

Simplify Your Mission To Create More Value

It’s the end of 2016. Regardless of the type of year you’ve had up (maybe more downs than ups) to this point, this time of year is always a good time to reconnect with why you’re doing what you’re doing. It’s a great time of year to simplify, plan and connect. That means it’s also a great time to work on your business’s mission.

The process of working on your mission is a process I’ve developed and also use quite a bit. I wanted to make sure that I was taking my own advice and that it made sense before I just started dropping what could be conceived as just trite generic business guru nonsense. Not giving you nonsense is really important to me because mission is one of the strategy concepts that gets lost in buzzwords, jargon, and empty language.

Your mission, your why, is supposed to be the guiding beacon for your business. How then can you run a sustainable business if what you say you do is very different from what you actually do?

You can’t.

In terms of thinking about 2017, it’s still early. Very early. This provides you with an opportunity to dig in a bit through the month or in some quiet thought whenever you happen upon this post. What you’re digging for is clarity for two of the simplest and most difficult questions about your business:

1. Who are you serving?

2. How are you serving your customer in a way that matters?

Easy right?!

Now comes the part where I challenge you. You’re going to see some bullet points that I believe are the most critical things you should be considering when you are (re)sculpting your mission and setting up your business for 2017. Remember, it’s your mission that will weigh in on every decision you make, every resource you allocate and how you serve everyone of your customers.

1. Who are you serving?

Get as specific as you can and try to make it about one person.

  • What are their experiences?
  • Where are they emotionally?
  • What kind of values to they have?
  • What are their demographics: age, professional level, marital status, etc.
  • What kind of social or cultural environments do they exist in?
  • What is important to them?
  • What are they afraid of or what’s frustrating them?
  • AVOID AT ALL COST PHRASES LIKE: “small business owners”, “stay at home moms”, “entrepreneurs”, “people looking for a restaurant”, “students”...You get the picture, right?

2. How are you serving them in a way that matters?

You created your business because you identified a problem and figured out a way to offer a solution. It gets easy to get bogged down by all the day-to-day to-do’s to lose sight of why a customer would still choose you.

  • Why do your customers choose you? (Price is the worst thing to compete on by the way.)
  • Is your solution simple to understand and implement?
  • Is the problem you’ve identified changing with customer tastes, expectations or improvements in technology?
  • Is there something so special about what you do that it would be tough for competitors to imitate?
  • Are you serving customer needs or wants? (Your customers motivations will be different for each.)
  • Are you clear on how your customers measure success? Is it money saved, time saved, headaches avoided, education provided, etc.
  • Are you providing a solution that resonates or matches up with who you’ve identified your best customer to be?

I know making trade-offs and focused decisions are hard but when you are clear on who you serve and who you don’t serve your business has an exponentially greater chance at success.

After you think about those questions for a while and get your thoughts articulated your last task is to distill all that information into a sentence or two. Your mission should not be a paragraph or worse an entire page. It’s also not the how to manual on how your business does the business of its business. (Yes, I did that on purpose because a  good mission statement is serious business.)

If you’re looking for a little inspiration one of my favorite mission statements of all time comes from Starbucks. Pulled from their corporate website the Starbucks mission is:

To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.

That’s a mission statement. Yours might not be as eloquent as that one on your first go around and that’s OK. Working on crafting your mission so that it reflects you and your business might take time. What’s important is that your mission means resonates with you and stands for something in your business. Get there and you’ll be ahead of most entrepreneurs I know.

3 Tips For Better Year-End Strategic Planning

This is a fun time of year for me. This is the time of year when I get to read, talk about and experience the wonders of all kinds of year-end strategic planning (and review) processes. It’s a blast because, for the most part, most people get it terribly wrong. They get it wrong because they follow dated template frameworks that don’t apply to their businesses, seek answers to self-referential questions and spend hours doing something that feels like work but will probably never have any real impact on their business.

My goal in this post is to give you a few quick and dirty concepts you need to consider to get the most out of your strategic planning process this year - hopefully not just a template. So before you tape your over sized Post-It notes to the walls or crack that new box of dry erase markers let’s talk about a few things.

1. Your strategic plan is not your step-by-step how to run your business manual for the next year.

It’s also not a budget. You need to think about strategy more simply and in terms of the choices you need to make that will get your business in front of the people that matter most - your customers. While budgets, cascading goals, benchmarks and actions are important it should all stem from the choices you make about the specific customers you serve and how you will serve them better than anyone else next year.

Take Away: In the strategic planning process don’t let your thought process or conversations go down day-to-day operations rabbit holes. Save the breaking down of specific responsibilities, tasks, benchmarks for later. Use something like the Balanced Scorecard (link takes you to Balance Scorecard website) to help focus on the broader financial, operational, people and customer perspectives.

2. Your strategy (or strategic plan) is not going to be perfect and that’s OK.

You’re strategy can and probably will change over time and that’s a good thing. You’re eye on the prize needs to revolve around revenue (not just controlling costs) and your customers. You want your business to be able to adapt to the changing needs and expectations of your market while honoring your vision. That means there’s always going to be a little bit of uncertainty in your planning. Give yourself permission to be OK with uncertainty as long as you’re setting up benchmarks along the way to test your strategy assumptions about your customers and the market you’re serving. If you were as addicted to Gordon Ramsay’s “Kitchen Nightmares” as I was you’d know one of the things he commented on most was the inability of restaurateurs to update their menus. So, to quote Chef Ramsay, don’t be an “idiot sandwich” and shoot for less-than-perfect.

Take Away: Don’t fight over what you can’t predict. If you run into spots where assumptions feel murky because they are based on future outcomes then you should set up times to revisit in the follow up in the next weeks/months/quarters. Conversations about what you can’t control can be draining and detract from the process.

3. Start quantifying.

Getting to the heart of making good decisions means getting to the heart of the data in your business. I’m sure (hoping really) that you had goals set for yourself through this past year. List them out and how close you were/are to achieving them. What do your sales figures look like? How big is your market? What are your margins? Who are your best customers and how many of them did you serve? When going through the strategic planning process it’s easy to get distracted by the big broad brushstroke topics. It’s easy to set goals of just “doing more” of certain activities in the next year. What’s hard is getting to the nitty gritty of your business. It’s getting real about what worked and what didn’t in a quantitative way and being honest about how you spent your time/resources/money this year. No one likes to admit to making bad choices or mistakes but you need to get real about where you are now if you’re going to give yourself a fighting chance to get better. Remember, when it comes to data and planning - garbage in = garbage out.

Take Away: Have the data of your business ready before you go into the strategic planning process. Spend some time getting re-acquainted with what’s going on in your business. This is more than just running some blanket financial statements. Look back at what you decided were key performance indicators in the past and, as honestly as possible, figure out where you stand today.

Whatever your strategic planning process looks like it’s my hope that you think about the three concepts I’ve listed above. At the heart of this process you’re announcing what’s important to your business and customers, setting goals and priorities and trickling that information down into the eventual actions and benchmarks your business needs to take to be successful. Please don’t just use some generic out of the box framework because it feels easy. Make sure the frameworks and tools you choose are relevant and will authentically support your business.

Launch Your Minimum Viable Business

Have a business idea that’s been nagging at you for a while?

I mean really nagging.

I mean the kind of nagging that inspires you to go out and buy a domain name or two for your new idea. The kind of idea that has you tinkering with websites that teach you to master the arts of coding, designing and copy-writing for free. The kind of business idea that had you go out and lock down all the social media profile names and @-handles you could think to secure. The kind of idea that you’ve been talking about and “planning” to do for a few months (up to years) now.

It’s the kind of idea that energizes you and exhausts you all at the same time which means - you’ve done literally nothing or almost nothing to date. Unless, you count the friends and family that obligatorily “Liked” your Facebook Business Page because you sent them an invite that one time.

If this is you and you’re tired of being in this space then you are in the right place. In this post I’m going to help you find and launch your Minimum Viable Business.

First a definition.

I am defining a Minimum Viable Business as a business that provides just enough of a specific value so that you can identify who your customers are, sell to them, support them and learn from them to figure out if your business has legs to grow - with as few moving parts in the process as possible. It’s a process that will help you best communicate the specific and measurable value your business delivers.

For those of you that are already reading all things entrepreneur I can already hear your retorts.

You might be thinking that this sounds an awful lot like getting to some kind of minimum viable product. Well, if you’re thinking that, you’re partially correct. The minimum viable product life of sitting through Steve Blank like presentations, LEAN Launchpad Accelerators and the waves of endless build-learn-iterate spreadsheets is not something I’ll be subjecting you to. With the Minimum Viable Business process it’s not only about the gathering validated learning, it’s also about getting clear about why you’re building this business, identifying the real benefits your customers will receive and building the systems to keep doing it.

So, here is an easy to follow outline of the Minimum Viable Business process that you can start using today to help bring to life what’s been swimming in your brain for a while.

1. I hate to do this but I am going to start by referencing Simon Sinek’s work about getting to your why.

I know, every business blog does this but it’s because his work is so on the nose. Your core beliefs are going to guide and influence every decision you make. Your motivation for building this business is also going to seep through every conversation you have about your business. If you aren’t authentic about your purpose and what you believe in then it’ll be really hard to convince people to trust you enough to give you money to solve their problems. It sounds super cliche but people really don’t buy what you do, they buy why you do it. You need to as honestly as possible get to these why’s:

  • Why are you starting this business?

  • Why is this problem worth solving?

  • Why are you best suited to solve your customer’s problem?

  • Why should anyone care about what you’re doing?

  • Why is what you believe in important? (For you and your business.)

If you answer these honestly (I recommend going a few why’s deep on each answer) you can start to see that you have the beginnings of a pitch for your business. The kind of pitch that people would be willing to listen to because it’s compelling and honest - not just a list of features.

2. Getting really clear on your target market is next on the list.

What does the ideal customer look like for your Minimum Viable Business? The more specific the better. There are lots of resources that go to great lengths to help you identify your target market but to keep you from spinning off into days/weeks/months of more stuff to learn and keep you distracted I want you to just answer this one question:

What is the smallest and most narrow group of people that exist that would get the most amount of value out of you and your business?

Let’s say you’re thinking about being a real estate professional and have just passed your licensing exam. You’re thinking about targeting brand new parents. If your description of your ideal customer stops there then it’s time to roll up your sleeves.  I want you to go deep on “new parent” ideas. How new? Do they have any other kids? What kind of places are they coming from? Is this a first home purchase for them? Are they Millenials? If I were thinking about the market for new parents and real estate I would going until I have something like this:  

I specialize in helping Millennial first time parents get out of the rentals (or parent’s basements) their new families have out grown and into their perfect first homes, not necessarily their forever homes. These first time parents are 30-something professionals that care more about the school system than they do about their morning commute and are looking to move out of a city/metro neighborhood and into a suburb. As a 30-something professional they probably have student loans they’re dealing with and are earning somewhere between $60,000 - $85,000/yr with possibly less than stellar credit.

Of course you can keep going and I encourage you to. The more specific you can be about who you serve best the better you can fit your why to them. When you’re doing this you’re also not spending time “researching” all the ways you can reach the Millennial market. That means you can allocate that extra time to getting in front of the people you most want to serve and (because of your why) delivering more value than any other real estate professional can for them.

3. What is the real value you’re delivering?

For this step we are skipping clean over the part about the mechanism by which you deliver value and going straight into what life looks like for your customer after they buy your stuff. The reason for the skip is that everyone’s delivery is going to be a little different depending on the types of products and services you are selling. You should be able to not only imagine but describe the value your business brings to people. Are you saving them time? Helping them land their dream job? Allowing them to do their work faster? Giving them confidence in their style? Your Minimum Viable Business should be focusing in on one really specific problem that your business solves in a specific way. Think about any home DIY project that requires a hole in the wall. If I have to go to the hardware store to buy a drill, it’s not because I need a drill (want maybe) it’s because I need a hole in the wall. What’s the “hole in the wall” your business leaves people with after they buy from you? Do your best to quantify this value as well.

4. What’s your secret sauce?

Secret sauce is also known as competitive advantage. The heart of this questions lies in getting to what it is that you do that is better or that matters more than any of your potential competitors. No, having great customer service or “working harder than the competition” are NOT competitive advantages. We are looking for the specific stuff that makes you better.

Odds are that if you’ve been thinking about your business for a while then you’ll have thought of a few other businesses that might do what you do. Now that you’re so close to going out in the world and serving your market we need to work on what makes you, your business or your process unique.  What is special about how you deliver value? Is your secret sauce in your process? Is it the fact that you understand your market better than anyone in a specific way? Is it that you created a system that gets to some kind of result faster than your competition? Are you making life easier for your customers in a certain way by granting them access to a resource that you can get cheaper than anyone else? Thinking about these questions and questions like this will help you get to identifying and ultimately communicating your secret sauce.

5. Get selling!

This is where the rubber meets the road. Up to this point you’ve worked on getting clear about why the world needs your business, what you’re delivering and how to communicate why your customers need you. Now you need to start the sales process. Selling doesn’t have to be scary but it does have to be consistent. The best way to make it consistent is to follow some kind of process. If you’re struggling with where to start I have a simple sales process for you:

  • Prospect - You have your description of your ideal customer/target market. Now start putting together a list of people or businesses that can benefit from using what you have built.

  • Connect - This is the part where people get stuck the most. Working in your business is easy when all of your focus is on internal development, plans and processes. Connecting via email, social or even a call is one of the first times you are putting yourself out there and it can be intimidating. This is where the conversations start and value get’s exchanged.

  • Present - Presenting doesn’t have to mean that for every new client or customer you have a brand new slideshow to present. It can be the routine you use to describe how you bring value to your target market. It’s in the presentation that you’ll be able to better interact with your potential client or customer and address their specific concerns and needs.

  • Propose - Make sure that you clearly outline how what you do will specifically benefit your prospect. This can be a formal written proposal created for your prospect or even a verbal agreement that is then followed up with some kind of short form terms or receipt.

  • Close - Ask for the sale. The Minimum Viable Business model only works if you can take a prospect through your sales process so that you can get to an ask. Getting a “no” is not a bad thing, it’s a measurable outcome that you can use to help shape your business. Use the feedback you get from the ask to better inform how you are proposing to deliver value and to the types of prospects you’re asking.

  • Deliver and Support - Might seem a little obvious but at this point if you have successfully gone from prospect to client or customer you have to do your best to deliver what you promised. Your solution doesn’t have to be perfect and if you were honest with your prospects through this process they will know that but they will expect that you can deliver on what you said you can deliver. After that make sure that you check in with them to ask about their experiences, continued needs, areas from improvement, etc. The people that do business with you are going to be your best source of information as you grow out of your Minimum Viable Business and into a sustainable one.

6. Keep it simple and keep track!  

I have talked and worked with business owners who drag their feet when it comes to selling their stuff because they think their solution and brand isn’t perfect enough yet. In the Minimum Viable Business process you should worry less about your branding, your letterhead, the fonts you chose for your homepage and more on the actual work. Can you sell your idea and your solution with the current level of tools you have available.

At this point you’ve been introduced to all the concepts you need to take your idea, your passion really, off the back of the napkin and bring it to life. It’s not scary! You must be deliberate about the early choices you make though. There are lots of little cracks that can swallow your time, money and energy so you have to be careful. You can’t allow yourself to lose chunks of time to working in the business - just get it good enough so that you can communicate your why, your value and why your customer should care. Then ask!

The last little bit is to do your best to keep track of the work that you’re doing. Especially in the sales process. Your early “closing ratio” shouldn’t matter much, that’s not the point of keeping track. The point of keeping track is to help you better identify patterns. Patterns that you can use to better iterate on your product or service, patterns to help you better serve your ideal customers and patterns to help you better deliver on the heart of why you thought your business was a good idea in the first place.

My call to action for you, a challenge really, is to stop tinkering and waiting for the “right” time to start. You’ve got more going for you than you think when you frame your business as a Minimum Viable Business so just get going!

Keep it simple, keep it valuable and keep it moving!

Stop Hiding Behind Your Business

I have been having the same kinds of conversations lately with the businesses I’ve been helping. I believe it’s because the businesses I’m working with have seen some growth and are all doing the exact same thing right after their growth experience. They are retreating into their offices and hiding behind the glorious (positive) data they have collected. I absolutely respect the sanctity of the growth process but, getting out from behind your computer screen and continuing to be out in the world making things happen just can’t stop!

I love data.

I will be the first one to tell you that I get a little bit of a thrill working my data into a model and then working on either creating some kind of inference or using derivatives to look for points of maximum/optimal return. But there comes a time when even the best modeling can’t guarantee business success - especially if that model you just built is a permanently positive linear one.

For all my creative independent businesses out there - I promise, that’s the last of the math talk.

I also love people. I love mission. I love seeing customers and clients getting value out of something I put into the world.

In order to create positive momentum in your business you have to go out and do the things you say your business does. You can’t just tinker.

This post is a cry out to any entrepreneur who has seen a little growth or momentum recently. Any growth. It could be an increase in view, subscribers and of course sales. My plea to you is to avoid the temptation to tinker. Avoid diving into your spreadsheets and falling to the business romanticising trap - the Business Ghost of Christmas Future Fallacy is what I’m calling this.

Having a plan and checking the results your actions have yielded against benchmarks for success is important. But a check-in is really all it should be. Here are a two tips to keep your inner quant at bay while you are out there in the world hustling in your business to succeed.

1. Commit to only changing one thing in your business model/process at a time.

This is how testing works. You go out and try to do something awesome for people that need what you are offering. If you feel like something isn’t working or could be working you make a single change and then get back out there. As you collect more experience and take more actions you’ll start to get a feel for the impact that change had - eventually deciding if it was a winner or not. This works best when you give your ideas some time to grow and your business enough time to get a little traction. I can’t tell you the perfect amount of time because every business is different. I can tell you that a week is probably too short and a two year period is probably a little too long. Check in systematically in that window a few times.

2. Stop running your business in terms of one-offs and winging.

Tinkering thrives in environments that lack structure. I’m not saying that every component of your business’ processes have to be etched in stone. What I am saying is that you need a routine. Tinkering happens because it feels like work and you have the potential to discover something interesting that might push your business forward. It’s not work that is going to directly grow your business through (most of the time). You know what will push your business forward - having processes or systems that take the winging out of your business. To beat the hour-eating-tinker-monster first find out what the important parts of your business are that need to happen on a daily, weekly, and monthly basis. Build a process for as many of them as you can that includes putting time into your schedule to plan, execute and review. This will lead to less one-offs and more focus. You’ll also find that your productivity will start to get a little better because you are worrying less on what to do and more on going out and doing.

Like I said earlier, I love data. You can’t get stuck in the data though. You have to create a plan that means something to you and then trust yourself (and the plan) enough to go out and keep bringing something awesome into the world. Whether you feel it or not all businesses have a bit of inertia to them. Great strategy is about building on the positive inertia so that you never stop moving forward.

How Do I Price My Product?

Buckle up boys and girls. This is going to be an epic deep dive into the different ways you can price your products or services. Pricing is an interesting topic and there's a ton of advice out here on the internet. The funny thing is that "other advice" doesn't really do a good job of setting up the frameworks so that you can compare how different pricing strategies work or can even change over time given the conditions in your market.  

When it comes to driving your business’ success, how you price plays a major role. Your prices communicate your value, can illustrate your quality amongst your competitors, and even influence what the market is willing and able to pay for what you’re offering. The problem with finding what the “right” price is for your business is that there is no magic formula. That’s where this article comes in. This article is going to outline some of the bigger objectives of pricing right and then offer you pricing strategies you can implement today. Your job is to figure out where your business model falls within the objectives and then pick a pricing strategy to run with.

Let’s lay some foundation points first:

  • Buyers are intrinsically motivated to get the most value for their dollar based on cultural, social, personal, and psychological influence. Buyers need to know, like and trust you. So work on understanding your target audience to best communicate your value to them.

  • Most buyers will go through this process:

    • Identifying their problem.

    • Doing some kind of research (yes even simple chats with friends count).

    • Evaluate their solution choices.

    • Make a purchase decision.

    • Have a post purchase response (think in terms of buyers remorse vs raving advocate).

  • As a seller you need to have the mindset that you are trading some kind of value for dollars. You are motivating buyers by fulfilling some kind of specific need. Those needs can range from being the low cost provider to offering the highest quality product.

  • Guessing is the worst thing you can do in your business when it comes to pricing.

  • Prices don’t have to be set in stone forever. They can change over time but remember your prices strongly communicate how your business is doing so change with purpose.

What Motivates a Seller

Below you will find some of the biggest motivations that drive seller behavior. The best advice I can give is to read each of these motivations with your business model in mind. Think about where in the market you want your business to compete and where you think you’ll have the biggest chance at finding success. Every seller will hit each of these points with varying levels of intensity. The important thing is to understand what should motivate you and to look at what you are doing in your business to bring those motivations to actions and outcomes.

  1. Maximizing profit. This can be a long or a short term goal and it has to do with how you have aligned your costs and production process. Every business should want to maximize profits. The special sauce here is understanding that high prices do not always translate to higher profit.

  2. Maximizing unit sales. This can be for both a maker and a do’er. As a seller you should always be striving to work at delivering the best work you can in the time you are allowing yourself to do it. Once you're comfortable a level of production work on continuing to build your capability and grow your capacity.

  3. Capture market share. More market share leads to more advocacy, more sales, more authority, and a growing community. You don’t have to be the biggest business on the block to be the most popular.

  4. Create barriers to entry. When you think of pricing and profits the more profitable your business the more incentives you will give businesses to try to jump in and steal your Kool-Aid. Finding your competitive advantage and holding on to it is going to make it hard for that to happen.

  5. Best quality or be exclusive. Creating a culture around your business and brand will help keep your customers or clients from making snap judgements based on price alone. You need to be aware of the low-price-low-quality stigma and if you are low price be prepared to combat it with a flurry of “innovation” based support.

  6. Using the loss leader strategy carefully. It can be tempting to start slashing prices to get traffic to your site or store front. Be careful about the message that sends and how often you use this tactic.

  7. Trial purchases. As a seller you might want to encourage your customers to give a trial a shot. The guys over at Fizzle did an awesome job of communicating and executing this concept. The best thing I can do is tell you to check out their splash page.

There are probably a few motivations that I missed but those are the biggest and most prevalent ones that sellers have to try to juggle when figuring out how to price their products/services and even running their business. You have to care about all of these things not just about what your profit or revenue looks like all the time. It’s ok if one or two resonate with you a little more than the others. Use what drives you most as you start to think about how you are going to price going forward.

Pricing Strategies

Now that you’ve reflected and mastered what motivates you as a seller it’s time to find the pricing strategy that fits best with what motivates you and your business model.

Cost-Plus Pricing - *Full Disclosure: Not my favorite because most people use this wrong* Cost-plus is a pretty straight forward approach in terms of pricing and it’s also one that lots of people default to. Just because it’s easy does not mean it’s right or right for you! All you do is figure out what the per unit cost of what your good is or of what your equivalent service is and add a fixed percentage to it as profit. So, if you are selling something that costs $100 to make and sell and you want to make 15% profit on each unit your selling price is now $115. This really only works in super niche, unique or noncompetitive markets. It’s not my favorite because as a seller you aren’t really doing any of the work you need to do to align your prices with the needs and wants of the buyer. It also doesn’t lend to the seller working to deliver more efficiency because the profit just gets tacked on to whatever the cost to market is.

Price Skimming - This is a fun problem to have. As you sell more and more of your stuff you’ll need more and more inventory or resources to deliver. As you continue to build capacity and your capabilities you are going to find efficiencies. As a seller you get to translate those efficiencies into lower prices for your consumers. This works really well with manufacturing and technology typically because you are playing with classic economies of scale. You are lowering your prices (lowering profit per unit) with the goal of moving more units than your competition. If you are a service provider or are selling an information based product this probably isn’t the strategy for you because continuing to skim prices over time might lead to unwanted perceptions of your brand and product. To make this work well you need to make sure that your quality is always staying the same or increasing (you might hear the buzzword: value innovation). When customers feel like they are getting cheaper prices and cheaper quality it doesn't go over so well.

Penetration Pricing - This is great for new businesses and it’s a pretty straight forward strategy. You enter the market at a lower price than your competitors and then increase prices over time. This is your typical trial offer. You entice buyers or users with a low cost of entry and then do your best to deliver as much value as possible with the hopes that those customers will stick around and continue to engage. Also works well when there are subsequent offers or upsells as part of your customer experience. The best success happens when your business is tied to a very specific experience or problem. I love this approach because you are communicating to your potential customers that you are so confident they will find success/be happy they will continue to come back and engage with you. Plus, if it was one of the few times that it’s not a good fit your customers only paid a discounted price so they are less inclined to be as upset (even less vocal) because the stakes were so low for them to try you out.

Prestige Pricing - Malcolm Gladwell does an amazing job explaining this concept in terms of Grey Poupon in one of his TED Talks that I linked here. With this strategy your goal is to create the perception of quality and exclusiveness. Higher prices here will imply higher value but there’s a catch. The price alone isn’t going to impress the average buyer. The packaging, copy, branding, and experience around the good/service needs to align with the higher price you are demanding. You have to create a prestigious experience for the buyer. This is a great strategy for service providers and information products because you are delivering a very specific solution or specific information that will solve your customer's pain points. The more specific your service the more expertise or experience is needed to deliver that information and in terms can command a higher price.

Bait and Hook. This sounds like what happens in the bar scene on the weekends but it really is a pricing strategy. With this strategy you are charging a low price for the initial purchase or interaction and then much higher prices for either replacement parts or supplemental services/products. The razor blade industry does amazing here. Think about the last time you bought a razor and what that price was. When you went back for more blades did you notice how much more expensive they were compared to the initial razor purchase. That is a classic bait and hook. The same goes for the average ink-jet printer. This works well if you can be fairly sure that your initial customers will continue to interact with you after the shock of learning about the higher prices the next time they engage with you. As a seller you need to be able to communicate the value of those subsequent purchases. If you fail to do that you’ll end up with customers like me that see the higher prices of the replacement razors, skip that purchase, and just buy another new razor start up kit.

Price Promotions. This is when you temporarily give out coupons or rebates to reduce your prices when you: introduce new offerings, are trying to attract buyers from other businesses, or you have extra inventory that you are trying to get rid of. These promotions work really well when you create mini campaigns around them for special occasions. This strategy is like a kinder gentler bait and hook. You have to be careful with price promotions - customers will only tolerate them for so long. If you coupon too often or too steeply your customers might think that your work doesn’t deliver the value your price says it should. Think of this as a strategic tool in your pricing tool kit.

Phew! I hope you are still with me :) So up until now you’ve been thinking about what motivates you as a seller and some different approaches to pricing. The last piece of the puzzle is talking about the customer’s perceived value.

Customer’s Perceived Value

This conversation wouldn’t be complete without touching on perceived value. As a seller, maker, do’er or marketer you need to understand a little more about what drives customers. There is a pretty easy measuring stick for this and it’s one that will also help you work on your copy when you are communicating your what makes you so awesome to your audience.

The metric is figuring out what the price or cost of the best alternative is and adding the difference in value that your work brings to the customer. If it sounds a little fuzzy it’s because it is. Unfortunately though, it’s one of the best ways you can work to differentiate yourself and figure out how your customers perceive the value that you offer. Another way to think about it is to think about what your customers are missing out on if they choose to go with your best competition...actually that’s an easier way to think about it. Use this metric as a way to take your markets temperature on what you are offering and comparing that perceived value to what’s out there.

It’s important to understand what you’re really good at (competitive advantage) and to be able to communicate that in a way that will best serve your target audience. Perceived Value is not just buzzword fluff and it’s not something that you should just skim over. When you are thinking about how your business stacks up against your competitors or how you are looking to be different start at your core. Your core capabilities are the things you have to do every day to get your work in the hands of the people that need it most. Think carefully about how where you are special or unique throughout that process and why that matters to your customers. Take me for example. There are lots of Professors, Small Agencies, Management Consultant Firms, and Freelancers out there that do what I do. We all have access to the same kind of information and tools (relatively). What sets me apart is my process and how I do my best to deconstruct concepts and problems so the business I work with can take action right away. That’s my competitive advantage - plus I hate when similar professionals hide behind academia or corporate boardrooms because they think they are the only ones that can decipher and implement strategy.

Phew (again)! If you are still with me then you have a solid set of tools to start really thinking about what sets you apart, what motivates you and how you can start to tinker with your pricing model. This stuff takes practice so just start! If you are looking for a little something extra to help you get started you can check out the free Disruptive Decision Framework down below.

Don’t forget to check back in with me too! I want to hear about your successes, struggles, and questions as you start to get objective and deliberate about your business. 

What Business Consultants Don't Want You To Know

Don't get distracted by the fluff! 

Don't get distracted by the fluff! 

Business strategy is great to talk about around the water cooler and looks good on paper better on paper. But, is that where it ends in your business? I sure hope not. There are already way too many wantrepreneurs in the world right now. If you’re talking about doing stuff and not actually doing stuff then you probably won’t be around for very long.

How then do you give your strategy and your business the best chance at success?

It’s in the execution.

I have a few strategy secrets that I want to share with you. They’re the kind of secrets that “consultants” don’t want to share because it’s what they use in their “coaching”. Yes, egregious use of “” but I’m not mad about it and it’s going to happen a lot in this post.

I’m putting all the untrained and inexperienced “business consultants” who charge for strategic planning on blast right now. I’m putting you on blast because strategy is not something that should be locked in the safe at the end of the day and it’s not information that should be kept behind long contract obligations and expensive retainers.

Before I get really salty on the hucksters out there I want to just take a moment to share the positives of working with quality professionals. Working with a strategy or business development professional is great because they can potentially bring in a new perspective, insight, and infrastructure when helping you build a strategic plan. They are the ones that help make complex concepts simple and actionable for you and wherever your business is at the time.

Let’s get to dishing on some of those insider secrets I mentioned earlier.

The first thing that you can do to give your strategy (and business) a fighting chance is be extremely clear on who gets to make decisions. Not only the who but, what kind of decisions they get to make and why their input is critical. You are literally describing and clarifying the rights that the decision maker has. You want to call them rights because it will help bring the expectations to a crystal clear level and you will avoid problems around who owns that decision.

Here’s why this is important:

1. Help people that you rely on understand how their day to day decisions affect your business's bottom line. Feel free to get brutally honest and transparent about the real costs.

2. Helps increase the way information moves through your business. This is super important even if you are a solopreneur.

3. Helps with delegation of tasks, resources, and responsibilities. Again even if you are a small business, (even a one person shop) deciding where to spend your time is critical. To decide well you have to clearly define what kind of decisions get made in the business, when they happen, and how you follow up on those decisions.

The next and final ingredient in the secret strategy sauce that “consultants” will charge you for is helping you understand how information flows through your business. You might not think that is important but in order to help push your business forward, having quality information that’s reliable is crucial - winging it doesn’t make businesses go.

Well go for very long any way.

You need to be collecting the right kind of data. Decide what matters most and track those things. You would not believe how many times I witnessed businesses just throwing away their end of day sales numbers. If you are a retailer or a service provider how can you make good decisions is you don’t have an accurate picture of one of the most important pieces of information your business collects - how much have you actually sold today!

Here’s what you need to think about in terms of information flow:

1. Look at your organizational structure. Is how you run your business day-to-day, week-to-week, and month-to-month providing you with good operational data when you make your decisions? If not time to reorganize.

2. Are your incentives aligned properly. Even when you are a business of one if your incentives don’t match your workflow or needs it’s easy to get lazy. Lazy leads to bad information and bad information leads to bad decisions.

3. Get cross-functional. Are you looking at your business from a holistic enough lens? That might sound “fluffy” but when you are trying to make decisions that will make your supply chain more efficient it’s important to measure that against the entirety of your business. Do you use all the information your business collects to make decisions?

4. It’s easy to just keep your head down and keep working. Are you picking your head up enough so that you can look around and make sure the information you are collecting and using is relevant?

Those are the biggest things to consider when you are trying to shepherd your strategy to  success. Consistency is important. All the other parts of the strategic planning process can be worked on over time. Keeping your competitive advantage, finding the cheapest suppliers, and making sure your margins are not pricing you out of the market can be tweaked in the very short-term. Setting the stage for good information flow and better decisions are changes in behavior take a little more time, effort, and follow through.

So go decide some stuff and make your business a strategy executing machine!