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10 Ways to Build a Successful Business

10 Ways to Build a Successful Business

Ever wonder what it takes to build a successful business? Many people have the talent, but not the right motivation and application. Very smart people with ambition often limit their success through simple mistakes. Follow these 10 steps and you’ll be well on your way to creating a successful enterprise!

1. It’s About People

The path to business success is built on personal relationships. If you think the most valuable aspect of school is the information or training, you may have missed many opportunities already. Look around when you’re around colleagues and form meaningful relationships. Take your colleagues out to lunch and dinner. The sooner you form these relationships, the more they can grow. Professional relationships will support you in down times and create opportunities that can make the difference between average and great success. Don’t think of relationships with colleagues as just professional either. Form personal bonds. Invite new colleagues over to your house, get your kids together. Personal relationships are the most meaningful to people, and you may make some great new friends in the process. I can’t tell you how many folks I met in graduate school that said they wanted a future successful business but turned down most opportunities to form relationships with their peers. Don’t confuse ‘professional’ with ‘impersonal’. Personal is professional. The world runs on emotional and personal connections. Much great professional success can come from the bonds you form with others!

2. Don’t Skimp on Marketing

Many new organizations use core staff to market the business even though those individuals don’t specialize in marketing. Many small business owners and entrepreneurs market themselves and do not consider outsourcing the job. Assuming you’re operating along principle 3 (below), bring in pros as soon as you can. Dedicate a percentage of all proceeds to professional marketing. Growth is an engine you need to sustain your business. A few things to keep in mind, however. Much of what is offered in the way of marketing services is overpriced and overrated. Sort through the run of the mill outfits and find someone with above-average talent. Verify best practices by interviewing more than one marketing outfit every year. Effective strategies can change quickly due to evolving technology and social practices. Don’t get caught thinking that your core staff, who may not have specialized training, don’t attend leading marketing conferences, and probably wear too many hats already, are up to the task. You’re probably limiting your success by having non-specialists handle one of the most important aspects of building your business!

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3. Hit the Pavement

In addition to hiring marketing pros (see above), you need to engage in your own marketing. As the principal figure in your business, marketing yourself will help you to properly evaluate the folks you hire to market on your behalf. And as the core from which your message to the world emanates, engaging in your own marketing will help you refine what you stand for and the value of what you’re offering.

Make brochures and go from business to business talking about what you do. Give free talks at the local library. Design your own business card as an exercise. If you don’t know how to sell yourself, your team will be much less effective. Anytime business gets slow, go back to the pavement and engage in some down-home, grassroots marketing yourself. Put up flyers in coffee shops and bookstores advertising your services. Create a free study group on an area of expertise. Write articles. Do some social media messaging. You should understand the value of your business so well that you can convince anyone in less than a minute that they need what you offer. Rinse and repeat until business picks up.

4. Increase Your Knowledge

Professionals can set themselves apart from the competition by increasing their knowledge in key areas of their field. Knowledge is power, and currency. You can use it to market your advantage over competitors, and to sell clients on the value of your product or services. The most advantageous knowledge is the type few others have. You may need to go outside your local area to find sources of knowledge that is uncommon in your community. Knowledge gets exponentially refined as expertise increases. Top experts will have a quantum grade over others. Knowledge also buys you credibility and access to others with similar knowledge, powering up the size and influence of your network.

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5. Be Tenacious

Building a successful business often takes sustained effort over time, a tireless belief in the value of what you’re offering, and a refusal to take ‘no’ for an answer. Entrepreneurs find ways through and around any obstacles in their path. They are not deterred. They turn failures into opportunities, and successes into greater successes. You’ll have down days and up days. Treat them like a roller coaster and keep on going. Remember, the weak give up. Don’t be in that group.

6. Seek Advice

You don’t know most of what you don’t know. Then there are the things you know you don’t know, and then the few things you know. Pollinate your mind constantly by seeking sources of inspiration and wisdom. Seasoned elders in your trade are often honored and willing to help if you ask for guidance. Many folks in senior positions want the world to be a better place and a chance to pass down lessons they have learned along the way to eager listeners.

If you meet business people who guard all their secrets, look elsewhere for mentors. Church can be a good place to find a professional mentor, or ask your friend group or family members. Identify the top ten people in your field locally and nationally, and see how many you can meet with to express a desire to learn from them. You should have one or two mentors you meet with regularly. A bonus: If they take a liking to you and if you impress them, they may also open doors for you or send you clients.

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7. Create Your Own Jet-Stream

Building off of tip #6, find a way to support the work of people you admire. It’s a way to learn from them by being around them and how they function. Talented individuals have a wake that follows their work because of the demand for their skill set. Be in their wake and model after them. You can learn an incredible amount from taking on the qualities of talented mentors, and you get a close-up view of how they operate by helping them in their work. The qualities of great people rub off on those around them. Make yourself useful and you’ll learn by doing. One day, if you become as successful as your role models, you’ll need those skills!

8. Tend to Every Aspect

Building a successful business requires tending to many disparate tasks and areas. This need to be good at different skill sets is one reason it is hard for many to succeed at their own ventures. Bring in consultants to support you in any areas that you don’t have expertise in. Consider this short list of key areas to tend to:

  1. Your content. What you sell, whether it be product or message. Make sure it is clear, relevant, useful and inspiring.
  2. Your self. You are the face of your business. Care for and tend to yourself. You are a walking billboard. Keep that in mind in terms of how you present yourself.
  3. Your audience. What good is a great message/product if no one knows you exist? Focus on building your fan base & database.
  4. Marketing. Includes online, print, PR, advertising, etc.
  5. Design. Makes a big difference, especially in this day of urban, aesthetic-savvy consumers. Get help.
  6. Branding. This matters a great deal. Your brand should be easy to understand and memorable, both linguistically and visually. Don’t muddy the waters with too many names for what you do, divisions, departments, groups, etc. Keep your name and mission focused and in front with everything you do, in-house and with the public.
  7. The technology side. You need to have an effective web presence and consider using technological tools to assist your business. This use of technology goes beyond the typical website. It includes software, analytics, algorithms, information capturing, automating processes, etc.
  8. The business side. We all need a good CEO. Someone with business expertise to consider how they would grow our company. Take a few seminars, consult with your local Chamber of Commerce, and consult experienced veterans. The business world has its own norms and language. You need someone who can speak that language, or teach you how, especially if you plan to partner or collaborate with other businesses.
  9. The legal side. Not be to be ignored. Keep things in order, and ask your attorney to help identify the areas that need attention first.
  10. Your team. As you start attracting quality professionals that can help you, identify a way to tend to them and keep the vision and mission coherent in their minds.

9. Leverage Opportunities

Sounds simple, but few people do it well. When an opportunity comes your way, you get a foot in the door, or a chance to speak to someone influential, it doesn’t just count as the one opportunity, you must think of how to leverage it to create other opportunities. The art of parlaying one success into another will definitely set you apart from folks who take the chances they get but don’t know how to make those part of a larger strategy.

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10. Make Use of Free Resources

There are many free resources that can help you become a success. Non-profits that support small business non-profits may offer free support. Your local Chamber of Commerce may offer free guidance and networking opportunities. Public universities often have department or office to support entrepreneurs. There are countless Meetups for like-minded business owners and to learn important skills. There are even private organizations that gather the collective wisdom of local executives who donate their time to support local businesses. Make use of the free support before you begin shopping for paid help and you’ll be more informed as to what you actually need.

These 10 tips will definitely put you on the right footing when it comes to launching a small business. Remember, put relationships with other professionals first (and make them personal). Prioritize effective marketing (decide on goals ahead of time, then run regular metrics to test what you’re doing). Seek out mentors and thought leaders, tend to every aspect of your business, leverage your opportunities and plug in to local resources. Now go get ’em!

Featured photo credit: 123RF via 123rf.com

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The Productivity Paradox: What Is It And How Can We Move Beyond It?

The Productivity Paradox: What Is It And How Can We Move Beyond It?

It’s a depressing adage we’ve all heard time and time again: An increase in technology does not necessarily translate to an increase in productivity.

Put another way by Robert Solow, a Nobel laureate in economics,

“You can see the computer age everywhere but in the productivity statistics.”

In other words, just because our computers are getting faster, that doesn’t mean that that we will have an equivalent leap in productivity. In fact, the opposite may be true!

New York Times writer Matt Richel wrote in an article for the paper back in 2008 that stated, “Statistical and anecdotal evidence mounts that the same technology tools that have led to improvements in productivity can be counterproductive if overused.”

There’s a strange paradox when it comes to productivity. Rather than an exponential curve, our productivity will eventually reach a plateau, even with advances in technology.

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So what does that mean for our personal levels of productivity? And what does this mean for our economy as a whole? Here’s what you should know about the productivity paradox, its causes, and what possible solutions we may have to combat it.

What is the productivity paradox?

There is a discrepancy between the investment in IT growth and the national level of productivity and productive output. The term “productivity paradox” became popularized after being used in the title of a 1993 paper by MIT’s Erik Brynjolfsson, a Professor of Management at the MIT Sloan School of Management, and the Director of the MIT Center for Digital Business.

In his paper, Brynjolfsson argued that while there doesn’t seem to be a direct, measurable correlation between improvements in IT and improvements in output, this might be more of a reflection on how productive output is measured and tracked.[1]

He wrote in his conclusion:

“Intangibles such as better responsiveness to customers and increased coordination with suppliers do not always increase the amount or even intrinsic quality of output, but they do help make sure it arrives at the right time, at the right place, with the right attributes for each customer.

Just as managers look beyond “productivity” for some of the benefits of IT, so must researchers be prepared to look beyond conventional productivity measurement techniques.”

How do we measure productivity anyway?

And this brings up a good point. How exactly is productivity measured?

In the case of the US Bureau of Labor Statistics, productivity gain is measured as the percentage change in gross domestic product per hour of labor.

But other publications such as US Today, argue that this is not the best way to track productivity, and instead use something called Total Factor Productivity (TFP). According to US Today, TFP “examines revenue per employee after subtracting productivity improvements that result from increases in capital assets, under the assumption that an investment in modern plants, equipment and technology automatically improves productivity.”[2]

In other words, this method weighs productivity changes by how much improvement there is since the last time productivity stats were gathered.

But if we can’t even agree on the best way to track productivity, then how can we know for certain if we’ve entered the productivity paradox?

Possible causes of the productivity paradox

Brynjolfsson argued that there are four probable causes for the paradox:

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  • Mis-measurement – The gains are real but our current measures miss them.
  • Redistribution – There are private gains, but they come at the expense of other firms and individuals, leaving little net gain.
  • Time lags – The gains take a long time to show up.
  • Mismanagement – There are no gains because of the unusual difficulties in managing IT or information itself.

There seems to be some evidence to support the mis-measurement theory as shown above. Another promising candidate is the time lag, which is supported by the work of Paul David, an economist at Oxford University.

According to an article in The Economist, his research has shown that productivity growth did not accelerate until 40 years after the introduction of electric power in the early 1880s.[3] This was partly because it took until 1920 for at least half of American industrial machinery to be powered by electricity.”

Therefore, he argues, we won’t see major leaps in productivity until both the US and major global powers have all reached at least a 50% penetration rate for computer use. The US only hit that mark a decade ago, and many other countries are far behind that level of growth.

The paradox and the recession

The productivity paradox has another effect on the recession economy. According to Neil Irwin,[4]

“Sky-high productivity has meant that business output has barely declined, making it less necessary to hire back laid-off workers…businesses are producing only 3 percent fewer goods and services than they were at the end of 2007, yet Americans are working nearly 10 percent fewer hours because of a mix of layoffs and cutbacks in the workweek.”

This means that more and more companies are trying to do less with more, and that means squeezing two or three people’s worth of work from a single employee in some cases.

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According to Irwin, “workers, frightened for their job security, squeezed more productivity out of every hour [in 2010].”

Looking forward

A recent article on Slate puts it all into perspective with one succinct observation:

“Perhaps the Internet is just not as revolutionary as we think it is. Sure, people might derive endless pleasure from it—its tendency to improve people’s quality of life is undeniable. And sure, it might have revolutionized how we find, buy, and sell goods and services. But that still does not necessarily mean it is as transformative of an economy as, say, railroads were.”

Still, Brynjolfsson argues that mismeasurement of productivity can really skew the results of people studying the paradox, perhaps more than any other factor.

“Because you and I stopped buying CDs, the music industry has shrunk, according to revenues and GDP. But we’re not listening to less music. There’s more music consumed than before.

On paper, the way GDP is calculated, the music industry is disappearing, but in reality it’s not disappearing. It is disappearing in revenue. It is not disappearing in terms of what you should care about, which is music.”

Perhaps the paradox isn’t a death sentence for our productivity after all. Only time (and perhaps improved measuring techniques) will tell.

Featured photo credit: Pexels via pexels.com

Reference

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