In today’s ever-changing business landscape, it can be challenging to make the right decisions for your company. Market dynamics are non-stop, and what worked last year is unlikely to work this year. So, what should lead your business decision making? Your product, your market, or your ideas? Let’s explore this question further by looking at a real-life example.
An I.O.T – telematics company makes devices to communicate changes in state such as water level, temperature, gas concentration, and sound/volume shifts, which are used in pipelines, cabling, and air. The product is offered as a service, with I.O.T advice and software to read and evaluate what’s being measured. However, this company is facing threats from competitors as barriers to entry fall, and opportunities in the market as client demand increases.
Product or market?
The founders of the company had different opinions on how to get ahead and stay ahead. Founder A wanted to add more features and capabilities to the suite of devices and software, in other words – product-led innovation. Meanwhile, Founder B wanted to introduce new products for different markets or use-cases, increasing the suite of devices and software, ie – market-led innovation.
However, neither approach was successful, both led to a series of investments in both product and market innovation, which confused employees, and drove poor performance. The founders’ ideas were based on their experience in product development and market engagement, with Founder A obsessing over competitor products and Founder B obsessing over competitor marketing and sales activity.
So, what’s needed to get it right? It’s essential to understand what business you are in by defining it in terms of clear customer segments, the problems you solve for each of them, and finally, the experience your customers want from you. This is the truest definition of customer-centricity, which is different from product or market-centricity.
This approach puts you in the forefront of the earliest changes in the everyday status of your customer. It’s the source of changes to how you engage (market-led) and how to change the product (product-led) decisions to get ahead and stay ahead. By focusing on your customer’s needs and preferences, you can make informed decisions that will keep your business relevant and competitive.
Pavlo discussed this in a recent Money Show podcast.
When making business decisions, it’s essential to focus on your customer and their needs, rather than solely on your product or the market. By adopting a customer-centric approach, you can make informed decisions that will keep your business ahead of the curve and set you up for success in the long run.
Running a business based on project revenue models can be a roller coaster ride. Money comes in only when a project lands, and business owners are sucked into high-risk projects that make it difficult to budget, plan, hold onto skills, stabilize suppliers, and scale. Every project feels like a game of roulette due to factors beyond your control, such as weather and the availability of resources.
To build an Asset of Value™ and escape the tyranny of project revenue models, some businesses have changed their approach. Let’s take a look at a few examples:
Construction Firm: This 2nd generation family construction business was hit hard by COVID-19 as big developments stalled. They responded by creating a designer-shack that was quick to erect, multi-functional, and aesthetically pleasing. It could be used for versatile spaces including a home gym, an office, a bar, a DIY workroom, garden shed or a kids’ playroom.
They found opportunities in multiple channels to market, such as website sales, retailers in hardware and building supplies, gym equipment distributors, realtors and estate agents, office furniture stores, architects, furniture stores selling bar-related furniture, liquor stores, and overseas markets for flat-pack, easy-to-erect versions of the product.
Software Developers: Two partners in a software development firm solved problems for big-brand corporate clients that the big-brand tech companies could not. They analysed all of their past projects and identified localsation trends, orienting their business around software solutions to manage complex SME value chains. .
Advertising Agency: Two partners in an advertising agency prided themselves on bespoke, thinking-outside-of-the-box solutions, but they struggled with a project-driven business model.
After positioning their service to zone in and focus on developing and producing brochures for vehicle manufacturers, their understanding as to how the brochures were used to promote, educate buyers and support the sales and marketing efforts of dealers allowed them to secure a consistent and reliable stream of projects. This flattened out their event based revenues into a steady stream of revenue, allowing them to hold onto talent, increase their return on marketing spend, build distinction and competence, and secure a capital buyout.
To get it right when changing your approach to building an Asset of Value™, you need to understand your purpose and intent, make a commitment to achieve that, create a path to exit, focus on a single goal, dedicate the first 90 minutes of every day and the last two hours of every Sunday to this goal. you may need to split responsibilities and fund one from the other, set milestones that shift time, attention, and resources, hire with the end in mind, and chase the transaction in the old business while building relationships in the new one.
Unfortunately, not every business gets it right. The construction firm sold two of their designer units and got sucked back into a new project, and nothing has changed. But for those who succeed, the rewards can be significant. The software firm has built a product that aligns with current trends and now generates approximately 85 million in annuity revenues across 350 clients. The advertising firm specialized in motor vehicle brochures and POS, created a repeatable, teachable process, built brand and reputation, and sold out in 2017 to a big agency for R23m.
In conclusion, by changing their approach and building an Asset of Value™, businesses can escape the tyranny of project revenue models.
However, it takes commitment, focus, and a willingness to take risks to make it happen.
In a recent discussion on the money show, Pavlo highlighted the importance of creating opportunities for oneself and taking responsibility for one’s own success. He discussed a remarkable success story of a couple who built a billion-dollar business out of a highly specialized product. However, he noted that having a great product or service is only half the battle – the other half is having a well-designed commercial system to market and sell that product.
According to Pavlo, a business can be split into two halves – the product or service and the commercial system. These two halves require different skills and leadership and management styles, but they must both be executed well to create a successful whole.
Pavlo gave an example of a Ph.D. holder who built a business that manufactures cages for lab rats to test the osmotic transfer of gases in and out of living organisms. The product is highly specialized and worth $1 billion annually, making it a global leader in its industry. However, the success of the product alone is not enough to build a successful business.
The second half of the business – the commercial system – is equally important. This involves marketing, sales, logistics, and other aspects of the business that ensure the product reaches the customer. Pavlo emphasized that a business should see the product and the commercial system as separate entities, each requiring different skills and designs.
To illustrate his point, Pavlo quoted Ralph Waldo Emerson, who said, “If you build a better mousetrap, the world will beat a path to your door.” However, Pavlo noted that having a great product alone is not enough to attract customers – the product must solve a problem for the customer, and the business must provide value for money. This requires a well-designed commercial system that can effectively market and sell the product.
A successful business requires both a great product or service and a well-designed commercial system. Entrepreneurs must focus on both halves and ensure they have the necessary skills and resources to execute each half effectively. By doing so, they can create a successful whole and dominate their industry for years to come.
“ChatGPT: The AI Language Model Taking the Business World by Storm”
Artificial Intelligence (AI) has been a topic of interest for decades, but with the advent of cutting-edge technology, AI is now more accessible and applicable to the business world than ever before. One such AI tool that has put the business world on red alert is ChatGPT, an AI language model developed by OpenAI, a private AI organization founded by Elon Musk, Sam Altman, Greg Brockman, Ilya Sutskever, and Wojciech Zaremba. With Microsoft among its investors and a $1bn investment, OpenAI is a driving force in the development of AI technology.
So, what is ChatGPT, and why is it so significant? Essentially, ChatGPT is a tool that helps businesses and individuals to communicate and engage with their customers and audiences in a more effective and efficient manner. However, it is important to note that ChatGPT is not a solution in itself but rather like an exoskeleton, providing support and enhancement to human capabilities.
The rise of ChatGPT has caused concern among some, who fear that its widespread use could lead to a homogenization of language and a loss of creativity. While there is some truth to these fears, ChatGPT has the potential to free up time and energy for individuals, allowing them to focus on more important and creative tasks. Moreover, the technology is still in its early stages and will likely continue to evolve and improve, offering even greater benefits in the future.
Pavlo expressed interest in his perspective on ChatGpt in a recent Money Show podcast.
So, why are we talking about ChatGPT now? As the first of many AI tools set to enter the public domain in a usable format, ChatGPT represents a huge opportunity for businesses to get ahead and use it to increase their performance.
Looking to the future, ChatGPT has the potential to create a range of new careers, including language model experts who will be responsible for fine-tuning, teaching, and optimizing the technology. Content creators who can step up and go beyond the vanilla will also have a key role to play, as will project managers, who will be required for all projects utilizing ChatGPT.
In terms of competition, it’s inevitable that it will come. However, the opportunity to use ChatGPT across all business functions is simply too good to ignore. From marketing research and communications to sales, operations, accounting, procurement, and recruitment, ChatGPT has the potential to revolutionize the way businesses operate.
Marketing departments, for example, can use ChatGPT for research, with the ability to ask and get an answer, without having to spend hours searching across websites looking to upsell. ChatGPT can also be used to improve the quality of communications and product descriptions, as well as translate website content into different languages.
In sales, ChatGPT can help to understand customers and markets, and improve engagement with relevant messaging, even in second languages.
In operations, ChatGPT can automate repetitive tasks and provide consistent product descriptions across all media. In accounting, ChatGPT can help with benchmarking and interpretation, while in procurement, it can aid in research and negotiation. And in recruitment, ChatGPT can be used to create job descriptions and KPIs.
ChatGPT is a game-changer for the business world and represents a huge opportunity for businesses to improve their performance and stay ahead of the competition. The future is here, and the time to act is now.
First, I’m assuming that you want to grow. If not, you will lose what you have. Look at it this way:
If you have a business with revenues of 20,000,000 and profits of 2,000,000, a starting valuation of your company would be around 10,000,000. Yes, a 5 multiple of EBITDA (and that’s generous in todays economy). With inflation running around 10%, not growing your company will see its value depreciate to 9,000,000.
To maintain its value, you need to grow it at inflation plus economic GDP growth plus industry growth rate plus currency depreciation. It rounds up to about 15%. To grow it, add a few percent (depending on your ambition) and you’d need to close out 2023 with revenues between 23m-25m if you maintained the same profit margin.
To set yourself up for this outcome, here are 5 questions you’d need to answer to set yourself up for growth in 2023.
1. What is your destination? – 2 years from now, what does your company look like? If you don’t have a destination, much like a ship at sea, you will run out of food, water and fuel. A destination is a measured, specific outcome. Last week we spoke about building a business backwards, starting at a destination 5-15 years from today and seeing what needs to be done tomorrow to get there.
2. What business are you in? – lead with the need. It changes every time there are changes, and both parts need to change, commodity and commerce. Customer behavior is changing rapidly as the business environment changes. The way consumers are behaving today is very different to the way they did 2,4,6 years ago. Between then and now, trade friction and political uncertainty arrived, covid smacked us all in the face, a war broke out causing energy to spike, inflation and interest rates have subdued everyone and on it goes. The ructions and shifts in our world are unlikely to stop and return to a predictable calm normality. Understand your business not in terms of products, but problems and experiences that are constantly changing with the changes in the environment. , You need to constantly be responding.
3. What can we stop doing? – Simplify. A piece of research was done, around 2007 on multitasking. It showed an intellectual attention drop of 38% when you multitasked. Sure, you can get a job done but the noise, diminished attention and incompleteness of it often requires rework or revision to optimise the outcome. Simplicity is essential to scale, concentrate attention, accelerate learning cycles (per the point above) and give you a return on time. Dabbling will compromise you every time.
4. How can we increase dependability? This means both reliability and consistency. Understanding what business you are in offers you the blueprint of how to engineer and design your business to deliver dependable outcomes in marketing, sales, fulfilment, and administration. Don’t be led by urgent matters, be driven by important ones.
5. What is the shared team vision? Go with your team, not alone, including them in the 10-year, 2-year, 6-month, and monthly goals. An engaged, motivated team that is accountable and self-led. This is especially important in a world where skills are in short supply.
Pavlo reflects on a business owner who had worked with Aurik and recently sold his company for 120 million. When Pavlo mentioned this purchase to another business owner, the response was: “He must be really lucky to land such a deal.”
Luck does count – where you are located matters, timing can matter but largely, it has very little to do with luck. For a business to have a high valuation in the sale, the business needs to be built backwards, starting with the end in mind and designing it towards the end goal.
This business was built eight years ago with the intention to sell it in the long run. When asked how much he would sell the business for, the owner said 100 million, and he was adamant on that number. To reward his years of investment, risk, and sacrifice, this was set as the target.
The plan to act for tomorrow had to work backwards from that future date. He and Pavlo ran a few numbers. What they calculated is that five years forward he would need to have a revenue of 85 million, profitability running at least 15% to be able to argue and justify a multiple of around eight. If you take the initial 85 million, multiply it by 15%, and multiply it by eight, you’ll get something like the 100 million target.
On average, most businesses are lucky to earn three or four multiples. But the reason for that is that when most people sell their businesses, they arrive at that point at the 11th hour after 10, 20 or even 30 years of successfully generating income. They learn that what they have built is a business that’s good at generating income but not a business that is transferable as an asset to the future buyer or acquirer. As a result, they are heavily penalised for the multiple.
The multiple is an indicator that effectively answers five questions.
In this podcast of The Money Show, Pavlo Phitidis breaks down the process of building a business backwards, and asks the 5 key questions:
To illustrate the point, let’s use an example of a furniture business:
If you address each of those five levers, you’re taking a three multiple to an eight multiple. You’re adding an additional point in each instance.
And that’s what we mean by an engineered approach, which requires you to start with the endgame, saying, “I want 100 million for my business.” and then design the business to deliver that eight multiple.
Why acquisitions fail to yield value:
A Harvard study from 2016 estimated that 82% of acquisitions made, failed to yield value for the buyer. Very often, these acquisitions are made by listed companies, where there’s quite a bit of pressure to demonstrate how your investments are yielding shareholder value. They identified all of the major reasons why these acquisitions fail.
Understand that when you are ready to leave a business, you need to serve and understand the needs of a new customer: The Buyer.
The problem is that most of us arrive at this point with three, four, five, or six months left because we want to get out at that point. We make the decision to get out, and yet we have never built the business in such a fashion that it fits neatly with what the buyer wants.
Start with the end in mind and build it backwards.
A commodity is something that is freely accessible, commonly available and wherever you look someone has something similar to it.
One example is auto insurance – there is basically no difference, because underwriters and actuaries all use more-or-less the same data to determine the price or value of the insurance policy.
Another is hot cross buns – the features and benefits are similar and available from 50 to 200 to 20 000 providers.
In the United Kingdom, where the stats are really good, there are 15,277 printers servicing this tiny island, and most of them are still in existence even though the market is flooded.
The question we should be asking is how do those companies survive, and what do they need to do to set themselves apart from each other? Because that’s where the art of selling and differentiating what you do in a commoditized world becomes the art of business growth.
In this podcast of the Money Show Pavlo Phitidis breaks down the commoditised environment.
Consider one of the most basic commodities available… a bar of soap. There are hundreds of thousands of variants.
Pavlo recollects on a business owner who started a soap manufacture business 15 years ago – much to Pavlo’s horror as soap is soap is soap!
This business owner entered the hotel amenity business, where a single major corporation dominated as most hotel chains wanted the cheapest of the cheapest while still maintaining quality. Amenities and soaps were things that nobody wanted to pay attention to. In a highly commoditized market such as this, he had no choice but to think outside the box, so to set himself apart, he set about understanding the brand of the hotel.
He did a deep analysis and discovered that there were approximately 3200 activities that contributed to the guest experience. It’s an incredibly complicated activity, and much of it is outside of that hotel’s control, from the arrival, travel to the hotel and activities as well as the departure.
He nailed the essence of what would appeal to tourists going through that hotel. And he began to craft a collection of amenities that were designed to specifically encourage guests to be taken home after their stay, through their packaging, their fragrances, and the feel of the amenities being used in the showers and bathrooms. The baobab scented shampoo that reminded them of their safari or the amarula bodywash to hint at sundowners in the bush.
He had conducted genuine and in-depth study to demonstrate how the senses reproduced experiences, which was what made what he did and was what made the selling propositions he had devised for the hotels so ingenious.
He created an experience to set his product apart, beyond the commoditised features and benefits.
And he was able to persuade one of the main worldwide companies that if the guest had a pleasant stay, he or she should be able to experience the physical sense and scent of the product that he supplied. When the tourist returns home, they will remember the experience, and they will remember the vacation they had at that particular hotel group and wish to remain with the same hotel group the next time they visit another destination.
” And that’s the art of differentiating in a commoditized world. You’ve got to go the extra mile to create an experience that sets you apart, as opposed to the features and criteria of your product”.
“Build a better mousetrap, and the world will beat a path to your door,” said Ralph Waldo Emerson.
It was true when quipped around 1770. There were few products, and if you made something reasonable, customers did exactly that!
Today, every product or service is a commodity. There are thousands of providers and hundreds of thousands globally.
Now, the adage should be: “If you have a mousetrap, you need to beat a path to your customer’s door.”
So, what are your options?
There are three strategies that you need to have in play: fishing, hunting, and farming. You need to do them all if you wish to maintain your market share and grow.
In this podcast of the Money Show Pavlo Phitidis unpacks, “FISHING, FARMING & HUNTING” in a business context.
There are two primary fishing strategies used in industry today.
In your business, you should use both strategies. Your content is oriented around your company’s successes, failures, thoughts, and views on the industry’s future.
Your net trawling would be your social media posts that talk about achievements, successes, and failures that you have gained. They are unpaid and might be seen by anyone and everyone, depending on the content and virality of the post. Their purpose should be to create awareness of your company and build brand and familiarity.
Your lure trolling is more targeted. For example, if you offer products aimed at solving problems in the restaurant industry, you could post your marketing content into a restaurant owners’ group on the social platform you can access. It is more targeted but still a hit-and-miss affair. The purpose is to create awareness and build familiarity.
Sticking to the fishing analogy, hunting is the equivalent of spearfishing. This is a very physical activity and requires you to dive under the water and actively seek out the fish you want to catch.
In your business, you actively go right to the source of your target, your customer. It means you need to know who buys your product, why they buy it, and where and when they buy it.
Again, using the fishing analogy, farming is where you identify a group of fish, hold them in a dam or lake, and feed them to fatten them up until they are ready.
In your business, this is the process of nurturing the customers you have engaged with, building relationships, creating familiarity, deepening education, and maturing them to the point where they are ready to transact and do a deal.
The three strategies work together to find, win, and hold customers—the essence of any business.
Turning this analogy into a system of marketing and sales is our job as business owners.
Led by your customer’s buying journey, which entails three broad stages: Awareness, Consideration, and Decision, you will use marketing (net fishing and farming), business development (lure fishing and farming), and sales (hunting).
The job of marketing is to:
The job of business development is to:
The job of sales is to:
All three play into and across each other as a system of finding, winning, and holding customers. It is what sets the winners apart.
Pavlo recently spoke with a well-established but frustrated business owner; this particular business owner is an engineer whose company is not growing as quickly as it could.
He has traction and a reputation after 28 years, but he can’t grow beyond an 11% growth rate. Every time he steps on the accelerator to expand, he takes one stride forward and two steps back.
Engineers are generally careful, as seen by the way their factories and manufacturing lines are constructed. For them, seeing what you’re doing makes it simpler to perceive progress, and when you can see something, you can delegate it much more easily because you can point to it.
Managing the commercial systems it is the tricky piece because how do you see marketing? How do you see sales? How do you see operations? How do you see administration? It’s there that everything was stumbling.
Think about what the commercial system is and consider the commercial elements of the business: Marketing and sales and operations and administration and managing people and managing money. All of them interplay with each other. They are all linked together no differently to the way your production process plays out.
As you run through the production process, the shape and value of the product you create, evolves. The same applies as you proceed from one business system to the next.
It operates in a methodical manner, with the first individual beginning with marketing and the second individual securing sales. The next step is operations, followed by administration, and we began mapping out this process since an engineer would enjoy it.
The business owner got this right and STILL was stuck at 11% growth – so what was the problem? People! He experienced that people disrupt the systems. Considering this, how do you get this issue of delegation right?
In this podcast of the Money Show Pavlo picks up on how to delegate right.
When you’ve been working for yourself independently, it’s easy to keep track of things. You don’t have to have meetings, and you don’t have to worry about other people’s lives and issues. You do it all yourself, and you end up burning the midnight oil. You’re working 16 to 18-hour days, ensuring that you’re up to speed with everything, but eventually you can’t do that anymore. You need other people to come in.
Pavlo runs a small exercise with business owners who are struggling with this:
This exercise depicts the typical amount of time spent by a company owner thinking about his business.
He sleeps around 8 hours per night and he’s awake for 16 hours. Some calculations tally that he has spent around 160,000 hours thinking about his business over the last 28 years. With all that contemplation, he’s ultimately got into deep, deep realms of complexity, which finally lead to a point when things begin to become simple.
With that in mind, the business owner is going to try to assign certain work to a manager in his company.
This business owner has five managers who are all well-established. They’ve each been there for an average of 11 years. So, we carried out a comparable calculation. 11 years… 250 odd working days at 8 hours a day. They are managers, and when they go home for the weekend, they are not thinking about the business. They’ve been pondering for an average of 20,000 hours.
You have 160,000 hours in the business owner’s mind and a total of 20,000 hours in the managers minds. Delegation becomes a tremendous challenge right away because you’re truly thinking and seeing things so differently based on how your team perceives and thinks about things. It starts there and only becomes a problem if the context isn’t set correctly and there’s no alignment in understanding what and how is being delegated.
The most common error that founders, owners, and CEOs make is assuming that the individuals to whom they delegate know what they’re doing and care as much as they do.
To overcome this gap, you have to delegate a complete, holistic SYSTEM, not just an outcome, and you need to revisit the whole system from time to time to ensure it is intact and functioning slickly.
Delegation doesn’t begin or end with an instruction. It’s an ongoing relationship with your team.
In a recent conversation with a global business broker, we debated why 94.6% of companies started failing to sell. This is despite them having survived the early years, grown into sizable mid-market businesses and provided nicely for their founders.
He shared a dreadful reality with me that he referred to as the 6 D’s. Most of his clients looking to sell their companies come to him because of the 6D’s.
Death – the death of the owner or a significant partner in the business
Disease –contracting a disease that prevents the owner or business partner from being able to work
Divorce – a divorce that leads to the company having to be sold
Debt – debt that the sale of the company can only settle
Disenchantment – essentially, when every day becomes and feels like a slog and a grind in which you lose your passion.
Disability – a disability from an accident or some other event that prevents the owner from running the company
Pavlo Phitidis breaks down the 6 D’s for business owners in this Money Show podcast
The antidote to these unfortunate drivers of business sale is the 7th D – Design.
Designing your wealth creation path as a business owner is seldom done, and nobody wants to face their fate. There are four simple steps that a business owner must follow on this path to have success based on their end goal.
Time runs out for us all. Starting with the end in mind and building your business into an Asset of Value™ from the get-go is the best insurance plan you can hope to have as a business owner.
This week I met a business owner who arguably has one of the best food ordering, payment, and delivery platforms I’m yet to come across. It is a marvelous piece of engineering and centers its value on empowering the restauranter to interpret customer behavior into innovations on service, menus, value, and therefore business growth. Brilliant…. but nobody knows about it.
With a bunch of clients onboard, it makes good money for the founders. This compounds the problem.
If you have a product or service that is well-designed, reliable and offers great value to your customers, how much market share should you own 10 years, 20 years, or 30 years into the game?
Surely, if your offering is that good, you should be dominating segments in your industry. Industries are not small. There are macro-economic reports on the value of industries across all countries freely available on the internet. Find one relevant to you and calculate your market share. If, after 20 years in the game, you believe that you have the best product out there, surely you should have…10% or even 20% of the industry market value?
If you do, well done. If you don’t, what then is the missing ingredient?
Listen to this week’s podcast from The Money Show where Pavlo Phitidis compares a business to a winning F1 team to explain the missing link!
To win the F1 championship, you need three elements.
It’s a great analogy for high-performing businesses.
Every successful business has three primary elements of excellence, interlinked and dependent on each other.
If you have the best product in the world, and if you aren’t dominating segments of the market in your industry, then it’s the commercial system set or gears that aren’t in play and optimized. If you have them in play and growth generates chaos, then they aren’t optimized and interlinked effectively. No tinkering with the features of your service or product design improvements will fix that and without it, your brilliant product will remain the world’s best-kept secret.
And then time runs out.
We recently surveyed a few hundred business owners, asking each what they saw as their biggest growth impediment.
The top 3 are
In this podcast of the Money Show, Pavlo unpacks an approach to deal with each of these big challenges to growth:
This is about business design. Like a ship, building, plane, or train, it is designed and built to serve a particular need. An office tower is designed differently from a shopping centre. They serve different audiences and fulfil different needs. They are designed to optimise their ability to meet these needs most efficiently.
The design of your business, too, must be thought through. What’s different in a business is that the design needs to shift and change as the business grows. Most companies I’ve seen operate with a business model suited to half or even a third of the current revenues of the company. It’s as if the businesses are stuck in a start-up or early stage of business design even though they are achieving revenues 2 to 3 times their maturity. It’s unsustainable and eventually kills you or the value you have created over years of effort.
Finding the right people to do the right thing all the time is a global challenge. Talented people are essential to growth. If talented people occupy a growth mindset and work on a business built for scale, you create a nucleus of growth in the industry.
Skilled people look to innovate. That means creating more value. If coupled with a scalable business, that innovation leads to growth. Competitors with talented people respond, and the competitive cycle kicks in, attracting funding, talent, and more innovation. It creates vibrancy and growth across and through the industry.
In an environment where talent is draining away or cannot be afforded because of its scarcity, the design of your business is key to getting your people element right. A simple business is scalable and needs a design that changes as the business grows.
The other impediment to getting the people piece right is delegation. Suppose you do not develop a delegation framework that lets you delegate effectively. In that case, you will always be pulled back into the engine room of the business. You eventually get worn to the bone, lose all inspiration and passion, and slowly erode the value you have created. Getting delegation right is about two things.
You and your attitude to delegation and what and how you delegate.
As a business owner, delegation should be your primary function. If you don’t believe in people, you don’t think anyone can do it as well as you or as fast as you. Suppose you harbour deep in your unconscious mind a fear of success that sees you erode the passion and inspiration of your team, amongst other things. In that case, you need to get some perspective. Fear of success is deeply unconscious, and it remains one of the greatest impediments to growth that I’ve come across.
How you delegate is equally essential. Most business owners delegate instructions, and this opens up misunderstandings that begin to break down trust and confidence. When someone doesn’t do what you told them to do, what attitude do you eventually hold toward them? The key to unlocking delegation is delegating a system of activities that can be measured and produce a definable outcome.
Many challenges are being faced across all economies globally. Inflation, cost of capital, access to capital, talent, supply lines, energy concerns, war, currency fluctuations, and political mismanagement are some of the many issues experienced everywhere. So, it’s not personal. And that’s the most important thing to consider. It becomes personal if you allow it to wear you down. You end up wearing lenses that highlight everything wrong and wear yourself down further. And with that, everything wrong begins to dominate your day, seeding depression and anxiety. You can get trapped in that space. Ask yourself then, what does that achieve? An alternative is to create a different reality and to do so by creating a morning mantra – I’ll only focus on what it can control.
When you disconnect from the internet, the anxiety and stress caused by various realities disappears. Next, recognize that what’s wrong in your industry is wrong for all. It’s not personal. Your competitors are suffering from the same challenges. It makes for an equal playing field.
To get ahead, adopt a growth mindset that says we will grow despite everything that is wrong. That pair of lenses lets you see the challenges as an opportunity to get ahead of your competitors, which means growth. As an outcome, it breeds positivity and feeds inspiration. You are in control of it all. If you struggle to get to the other side of a negative mindset, get some help. An outside perspective is valuable and can prevent you from wasting months or years of your precious, valuable time, which you can never get back.