Doug Wagner @ Sunwapta

How Much Effort Does It Take To Move From Good to Great?

I was asked a question today. It was about our Manifast product which is aimed at allowing businesses to bring strategy, working on the business and developing your people to the same level of importance as working in the business; serving customers and fighting fires.

Roughly the question went like "How much effort is required to setup the tool and maintain the information in it? Is the benefit of doing all that stuff worth it?"

Aside from the context of the tool the question is really more fundamental:

"Is the effort of documenting, planning and executing your strategy, building your business and developing your people worth it? Would I not be better served just taking action and spending the time serving our customers and finding more customers and deal with issues as they come up?"

Is Business Planning and Improvement Worth It?

If you are a one person shop or very small organization you may be able to keep everything in your head. You may be doing some strategic planning and working on the business is really just changing the way YOU do things. Not hard to track.

My experience as well as learning from numerous sources is that the majority of businesses that don't consistently plan and execute on their plans under-perform their competitors significantly. If you are in an industry that is trending upwards you may still be profitable and even seem to be doing well.

However, you are likely leaving tens of thousands to millions of dollars on the table. You may be impeding your ability to grow and sustain that growth. Your business may not be heading in the direction you really want it to and it may not serve your needs as the owner.

Your fire fighting will likely consume more and more of your time as you grow. A great business will fix problems and become self-healing without everything being a force of will from the top. You just need to take the time to build that organization and train the people in it on building a business.

Do You Want to Have a Great Business?

Great businesses have great customers. They attract top talent and top customers much more easily than their competitors. This translates to larger profits and ultimately, a great value on the business itself.

Each company must choose its path. Choosing the path to being a great company (large or small) means doing those things most other businesses chose not to do.

• Consciously choosing your path and taking action to get there;
• Building a strong corporate culture and brand;
• Building the best possible business to reinforce and support the objectives;
• Working on the business and people so the fires don't come back;
• Hiring and developing your people to support your business;
• Building a truly learning, engaged and empowered organization that can move quickly in the market;
• An organization that plans and more importantly executes its plans through action.

Yes, this takes some work. Many people advise that organizations spend 10-20% of your budget on strategy, business and people development (more if you are growing quickly or spending on research and development for new products).

And Using a Tool?

And using a tool to manage all of this? Where were you going to document it all without the tool? How were you going to track everything that needs to get done? How much time would you be spending communicating and coordinating all of that information and keeping everyone on the same page? How much time tracking accountability? How much time conceiving and managing the process of managing all of this and ensuring it gets done?

And the real work is in the execution.

Yes, there is some learning time to master a new tool. Yes, there is some initial setup time and you need to invest in maintaining the tool. The underlying business skills take time to learn as well.

Any good tool pays for itself many times over.

How much effort does it take to go from good to great? Much less over time if you have the right tools and use them well.

Are you looking to build a great business? How are you doing it today?

The Paradox of Referral Fees

Offering referral fees to others to send business your way is a two edged sword at times:

• On one hand you can really increase your customers,
• On the other hand you might not get the customers you really want or need.

Therein lies the paradox.

On The Positive Side

On the positive side you are offering a financial incentive to others to refer business your way. Your customers and "agents" can earn some cold hard cash sending business your way.

You hope that the person doing the referring is looking out for both your and the potential client's best interest in making the connection.

But There Is Another Side

However, this is not always the case. Your "agents" may start sending business your way that is not good for you and even worse, not a good match for the customers.

And once they find out that the "agent" was benefiting financially from the referral they can become bitter to both the agent and your company by association. With the reach of Social Media, this may be a complication you don't need.

There is another issue on the psychology side: monetary incentives alone do not motivate well long-term. Some people are even arguing that pay for performance is causing people to blindly seek the money and game the system.

Giving Amazing Value Instead

For our Manifast product we are looking for business advisers (coaches, mentors, consultants, board of directors, etc.) who would see value in offering a tool to reinforce and add to the value to their consulting work. They get added revenue from helping their clients actually do the planning required and we get the software licensing fees.

The consulting work per client potentially far exceeds our piece. We would also expect to eventually refer work back to the advisers.

Already we are thinking of the tremendous value to both the advisers and the customers.

Raving fans of your product who give referrals out of caring are potentially worth a lot more to your brand than paid agents. As well, many advisers need to remain unbiased in the eyes of their clients so will not want payment anyways.

(And in the future we have even more powerful value propositions in store for both groups.)

So first look for other ways you can give value back to your champions so that referral fees are not necessary. Amazing value.

Conclusion

Referrals fees can work well for certain types of business where an unbiased referral is not a concern and customer matching is easy or straight forward. Commodities like books are like that.

If you are going to use referral fees make sure you set them up to get the customers you really want and need. Also be prepared to deal with the administration of score keeping and refereeing those trying to game the system.

I like the idea of delivering amazing value and getting customers to become raving fans.

Are you using referral fees successfully? Leave a comment.

Are You Too Busy To Add Big Dollars To Your Bottom Line?

• Do you have a company culture of continuous improvement?
• Are you dedicating 10% or more of your time to working on your business?
• Do you delegate parts of your business and have a methodology for holding people accountable for performance?

If you are not, you are impacting your profitability in a big way.

As a business owner this is coming right off your bottom line. If you are losing $10,000 in costs (i.e. profit) and you have margins of 5%, you would have to earn another $200,000 in revenue to make that back.

Business advisors like Jeff Pallister can come into many businesses and easily find $50,000 in savings in a short period of time. He does this largely by tapping into the latent talent and creativity of your existing team.

Our Own Example

Recently I had to step into a business process and get some work done that was languishing. The people currently doing the work did it in short bursts and then did something else; the work was cyclical. Because I wanted to do a large batch all at once the flaws in the process became painfully obvious. Because I am very time constrained I elected to fix those processes. The result was that I was able to do the remaining work in 50% less time, saving 10-20 hours of effort.

The “E-Myth Revisted” by Michael Gerber promotes the idea of the entrepreneur(s) learning and doing each role until they understand it and make it repeatable and efficient. Only then should you hire someone to perform the role. This is part of the idea of running your business as a franchise, even if it won’t be.

Now this is not the only way to do it. But as an entrepreneur you must own the “creation of your business”. You can delegate pieces but you must train, coach, measure and hold accountable all of the people you have delegated the process to.

Over the period of a year we spent 500 hours supporting, upgrading and administering one application. A 10% improvement in overall efficiency could translate into 50 hours of savings a year.

As the president I am an expensive resource as are some others in the company. But once the process is more efficient and predictable you can delegate certain work to less expensive resource without the risk of having it all fall apart. Now you have a double savings; $5,000 becomes $10,000 or more.

This is only one process out of a lot even for our company.

It is likely you are sitting on a lot of lost opportunity as well. Maybe even your ability to grow or become great!

How It Works

There are several things you need to do to successfully work on the business. Other than customers and your product and services; building a great company involves three things that often get overlooked:

1. The strategic plan and execution;
2. Working on the business (processes, systems, tools and infrastructure); and
3. Developing your people.

Working on the business means:

• Defining the things you need to measure (KPIs);
• Defining your business components (processes, systems, tools and infrastructure);
• Aligning the business components with your strategy, values and people; and
• Making your business as efficient and predicable as it can be.

Using a proven methodology is a great first step. Using a tool like Manifast to reinforce the process and streamline the tracking is even better.

What is in it for employees?

Well you could use a percentage of the increase in profits to self-fund a profit sharing plan. Most people also want to be efficient and produce at the highest level possible. They just need to know how to keep score and have the time and tools to do it.

What about you?

How much time do you spend working on your business? How much money might you be leaving on the table?

What action are you going to take? Today?

Leave a comment.

Chain Reaction (to Sustainable Profits)

I read Chain Reaction - A Business Novel by Jeff Pallister a few months ago. I enjoyed the book and found that a lot of Jeff's thinking paralleled our thinking about how business could be.

Jeff Pallister is a speaker, author and management consultant who specializes in applying creativity and teamwork to generate increased profitability.

The book itself is about the company president Ryan Vale who was hired by the founders to get the company back on track. Most of the founders are reaching the end of their careers and want to cash out by selling the company and then enjoying retirement.

One big problem. The business is not worth nearly as much as the owners thought it was because it has some issues:

• Not profitable enough,
• People are leaving the the work is falling to others; increasing stress and problems
• Dependencies on key people,
• No recent innovations and the great products of the past have been copied by competitors,
• No real strategic plan,
• No accountability,
• Not working on the business and fixing the real issues,
• Etc.

Ryan then hires a consultant who guides him through the "12 Best Practices" to turn the company around. I won't spoil the ending. I recommend you get a copy of the book if you are suffering from any of the issues mentioned above.

Chain Reaction and Manifast

Manifast is the software product we developed to help small and mid-sized businesses and organizations find the right balance between: "Strategic Planning, Working on the Business and Developing Your People" and "Working in the Business".

Using a integrated software tool to keep your team focused, accountable, communicating, etc. can add a lot of value and effectiveness to execution of your plans. Using a coach/consultant and software tool together can add tremendous value.

Here is a quick overview of how our tool can be used to support the implementation of the 12 Best Practices in Chain Reaction.

Chain Reaction Practices	Manifast Tools
Tap Into Creativity	Brainstorming Tools
Work Through Teams	Team Planning, Developing People
Lead	Entire Tool
Set a Clear Direction	Strategic Planning Module
Know the Score	KPI Tracking, Goal Setting
Create a Productive Work Environment	Working on the Business, Developing Your People
Apply Rigorous Methods	Brainstorming, Entire Tool
Redesign Processes	Working on the Business
Eliminate Hidden Costs	Working on the Business
Deliver Innovative Products	Strategic and Team Planning
Create Exceptional Customer Value	Entire Tool
Create the Chain Reaction	Entire Tool

Read the book for details on the best practices. Contact Jeff if you would like more information about his services or book.

We are honoured that Jeff chose to work with us and become an early adopter of Manifast for both himself and his clients.

What software tools do you use to implement your business planning and execution? Do you use a coach or business consultant to help your business? Leave a comment.

Are You On Auto-Pilot?

You know that feeling you get when you drive home along a familiar route and afterwards you don't remember any of the drive?

That is what running on auto-pilot is like.

Your brain is amazing. If you've done things repeatedly the same in the past before, you can do them again with little thought or effort required.

The same is true if you are doing something simple or low risk. You don't need to fully engage.

In both cases you can run on auto-pilot and safely get to your destination.

Until something changes suddenly. Or until a danger suddenly appears.

Then you will be present again.

But it just may be too late. The lack of attention may be fatal when the danger become obvious. The sudden whack in the side of the head that you are too late ducking.

You can't afford to live your life or run your business on auto-pilot. You and your customers deserve your best.

You need to have and follow a plan; even if it changes regularly.

You need to work on your business. As well, you need to work on yourself and your people to prepare for the future.

And most importantly you need to have a system that helps you stay focused, even when you could run on auto-pilot.

I'm Not In The Mood For...

The other night I was in a funk and this post almost ended up being titled "Real Men Don't Talk About Depression" but while there is still too much silence and taboo around the topic; I didn't want to take away from the plight of those who are clinically depressed and this post ended up on a different path anyways. I must also credit Carrie Wilkinson of The Barefoot Executive fame for showing me the value of being real (i.e. human) and thus not deleting this post entirely.

As we started the New Year I was both excited and overwhelmed by business and personal objectives. I won't call them resolutions because they are really just continuations of the paths I had set last year.

But there is something magical and crazy about 1 January 2012 as a date. It feels like a new cycle and a chance to instantaneously fix all of the problems you perceive you have about yourself.

So a week into 2012 I was still clearing stuff I was supposed have finished last year and this year's stuff was piling up. Lots of things that needed to get done, lots of people depending on me, and lots of decisions that needed to be made... fast.

Yup, I was pushing myself beyond my comfort zone. Way beyond. And not moving very quickly.

So then I got in a funk. And stayed there. My mood was in a down cycle.

That is not to say I could not function or appear fairly normal. But my spark was gone and I was a little quicker to react negatively to things.

And with it the spark for a thing I value immensely: creativity. For me my creativity is best when I am in the right frame of mind. I don't create on demand.

Being an Introvert

Then last night I remembered reading "The Introvert's Guide to Success in Business and Leadership" by Lisa Petrilli. In her book she uses the most accurate description of an Introvert as someone who loses energy in public situations (crowds, networking, etc.) and needs alone time to regenerate. But that was not it as I was not actually doing a lot of public stuff.

Then I remembered the second part. Introverts often also need time to reflect to make decisions.

I was feeling overwhelmed because I was trying to hold in my head and make too many decisions at the same time without giving myself enough time to reflect. So they were all sticking around and coming back to occupy my attention any time I was not intently focused on something else.

This causes the feeling of being overwhelmed.

I suspect many other business owners, entrepreneurs and people feel this way at times.

The natural defence at this point is avoidance. I just won't do ANY of the things that make me uncomfortable.

Fortunately, There Is A Solution

Fortunately there is a solution and it does not involve quitting my role or hiring someone to deal with everything I don't want to.

It is using a system to get rid of the noise and focus on action.

There are two parts to this system:

1. Break big problems and solutions down into bite sized pieces.
2. Pick your most important item and take action, focus.

If you don't know what the most important thing is or how to break something down, pick something important and take action that you think will move you closer finding the root of the problem or implementing a solution. Build momentum that will boost your mood.

In our Manifast product we are calling this "My Most Important Work". Some people use a quadrant based prioritization system (based on important/urgent). Whatever works for you.

The system helps with analysis, reflection, (and most importantly for an Introvert) decision making and taking action.

Now that I've recognized one of my triggers for a funky down cycle I can use that knowledge and the system I've outlined to recover my momentum faster.

"I'm not in the mood for creativity" may just be a thing of the past, or at least more short-lived.

Resolutions for 2012 - Dream Big

Assuming I set New Year's resolutions I would have the following and more:

• Get more sleep on a regular basis,
• Exercise more,
• Eat better,
• Lose 10 pounds,
• Achieve more business and financial success,
• Balance my time over all areas of my life,
• Have a neater and more organized work space,
• Waste less time on distractions,
• Deal with stress better,
• Travel to Mars.

But if I haven't done those things consistently in the past, what makes me think I will do them in early 2012? Why am I making a big list of things I will likely fail at?

The problem with resolutions is that we tend to focus on the things we aren't happy with... our weaknesses. Oh we can couch them as goals with positive sounding outcomes. Let's face it though, we are forcing ourselves to accomplish them with a big stick approach.

So I propose you look at the things are are doing right and probably enjoy. I hope you have some.

Do more of that.

That is action.

Then make some small positive changes. Bundle the small improvements with the things you enjoy or do the things you enjoy as a reward for the improvements. Focus on a few things at a time. Build momentum.

Set goals, plan and take action regularly throughout the year. Start small and get bigger as the momentum builds. Make your ultimate goals so exciting to you that the work required to get there is worth it. As you get better at it you will be able to set bigger goals and actually achieve most of them.

Just don't save this for a once a year guilt trip. That is why I don't do New Year's resolutions. I believe in working on goals and reflecting all year, not just in December.

Dream big. Everyone should have a big hairy audacious goal (BHAG) they are working on.

Who is to say I can't actually visit Mars (or some other big goal). You might be wrong. And the BHAG gives me focus and reason to take care of the other important things.

Have a wonderful 2012. Dream big and achieve all year.

The Master Plan - How Money Works Part 4

In the previous post I talked about how to intercept the flow of money. This post addresses investing, borrowing, the master plan and concludes the series.

But What About Investing?

When you invest money you no longer have it in your possession. What you have is either a promise to give you your money plus interest back or you have ownership of shares in a company or other investment vehicles.

Cash investments are loaned to others so the money can be spent on something of value.

When you invest in a company you are either buying the shares (at their perceived value) from someone else or you are giving it to the company itself to invest, or spend to grow the business. Eventually you hope that the company will generate value for customers and thus your value. But they don’t hold onto it either, they invest (spend) on things for future growth or you are buying someone else’s shares.

So again, money is flowing.

You don’t actually have it in your pocket or under your bed. You have the promise of getting your money back or you have shares (or similar) you can sell later to get your money back plus some (if you invested wisely). Essentially you have the ability to tap into the future flow of money.

The money is in motion, now and in the future.

Why Borrowing Is Bad

Borrowing money means that you are trading your future ability to create value for something today.

Not only are you trading the future for today, you are paying a price on top of that called interest.

This works ok for very short-term loans (i.e. paying down your credit card balance each month). It is a very bad approach to acquire long-term debt for today’s pleasures and material goods. Essentially you are trading your future potential to create value for something today.

Borrowing can make sense for two situations:

• The acquisition of a home where rent would be comparable to the cost of the mortgage and the real property is likely to go up or at least not go down in value over the long-term.
• Investments where the costs of borrowing are less than the expected return on the investment… you are creating more value than you are spending.

The problem is that to encourage the flow of money and thus the creation of income for people (interruption of flow) and companies, the government and financial institutions have been making consumer lending very easy to get. This encourages excessive personal spending today but at the price of putting a limit on the future flow of money since you are already pledging the future today; once you are maxed out, you can’t do it again until you pay it all back plus interest.

The problem is even worse in that governments at all levels are borrowing against the future tax base on your behalf. Since the future tax base is essentially your ability to produce value in the future, they are borrowing against the people.

You can only borrow so far into the future before it can all unravel.

 

What Happens in an Economic Slow Down

Some event triggers people and organizations to stop or slow down the flow of money. When this happens, people and companies are not able to interrupt the flow of money at the rates they could before the slowdown.

The flow of money slows down.

This is why the government’s reaction to this is to spend money and lower interest rates. They are trying to kick-start the flow of money which has a cascading effect. Consumer confidence is actually a measure of the stickiness of the flow of money.

However, the government needs to borrow money to do this. And they need to encourage you to borrow money so you will spend it.

It is an insidious cycle.

And it is all artificial.

Money was created by people. The flow is created by people. Borrowing from the future is created by people. People have figured out a way to consume value today and pay for it later; often much later and longer than expected.

The Master Plan for Debt

Don’t worry though. There is a master plan (insert evil laugh) for how it works. It is not pretty but it is the way it is.

Inflation and growth.

The value of money (specifically long-term debt) is devalued over time so it gets easier to pay back. As well, the ability to pay back the debt is mitigated by expectation of the constant growth of total value created (population growth and productivity) product and services.

Oh, and your children will pay for the excesses of today as well since people have been borrowing against the future excessively. Or maybe they won’t.

Sadly, we are already seeing how well this plays out in some of the European nations and even the US.

Conclusion for Smart Business (and People)

You can interrupt as much of the flow as you want without hurting anyone else’s ability to interrupt the flow. This is not dirty or shameful, it is the natural way things work in commerce since the beginning of civilization. Value traded for value. Money just makes the flow easier and faster.

You interrupt the flow by creating value and reaching (influencing) as many customers as you can.

The more value you generate compared to the money you bring in (interrupt) the more resilient you will be to a slowdown in the flow (poor economy) or threats from competition.

Focus on the future and long-term sustainability and growth. Don’t go for the short-term quick gains at the price of the future. Invest in the future. Live within your means today but realize that doing so means your future is wide open, unlike those who have borrowed heavily against it. You’ll sleep better too.

The amount of value that can be created is nearly unlimited. So is the potential for each person to create value. As wealth is created the flow increases and more wealth can be created (more interruptions are possible).

Slowdowns are created by the perception of shortage and excessive borrowing against the future.

So there is no shortage of money, only a shortage of understanding and people creating the value needed to intercept it.

Final Note: This is my take on what they all mean when they say there is no shortage of money. In reality "abundance" is a good way to look at things because it means we can work together and not entirely against each other. Of course the real world is more complex.

What is your take on money?

The Right Way to Prospect (Intercepting the Flow - Money Part 3)

I ended the previous post on how money really works with a quote. A very important quote to be sure. But it doesn't tell the full story. It doesn't say how to intercept the flow of money.

How money works was not in and of itself why I choose to discuss the topic at this time.

So what is the right way to prospect or sell to maximize your income? When should you give your killer elevator speech? How should you get the conversation focused on you?

Don't.

Stop doing it from a me perspective.

It is all about the person you are interacting with and not you.

Create value for that person without the expectation of anything in return. "All things being equal, people buy from people they know and trust." (Bob Burg)

Call it Karma. But what goes around comes around. Give first. Be genuinely interested in the other person. Build relationships. Do something of value for that person without any expectations. Everyone is not a potential customer, but they are people and a potential friend.

The way to get noticed by the flow is to insert value into the world. The flow is really about value for people. Insert enough value and the money will eventually divert to you.

You don't really control who will be your customer. It is their choice not yours. And you never know who will know who and how the rewards will flow back to you.

This happened with our own business. Our biggest customer noticed us 11 years ago not because of our sales, but because one of our partners was active in giving back in the community.

It is real. It works. And it is the better way to do business and love your job and business.

How Money Really Works - Part 2 Business Income

In the first part of this larger topic, I talked about how some people think of money and how it works at a personal level.

In Part 2 I cover how it works at a business level and how you can get as much as you need and why there is no real shortage of money.

The Big Picture – The Big Flow

Picture the entire Gross Domestic Product (GDP) of a nation or the world. This is a measure of the flow of value that is changing hands. It the cumulative value created by everyone in the economy measured in money. Actually it is not the total value it is the compensated portion of the value.

No one actually has this money in their possession. In fact, there does not even need to be that much physical money in circulation because money is only needed for the exchange and then is in flow again. Most of the exchange occurs electronically these days.

The economy is a giant flow. The giant flow is made up of countless smaller and larger flows.

Every person and every organization intercepts a piece of that flow and returns it back into the flow one way or another.

How Do You Get More Money?

People create value by working. Companies create value through products and services. Some value is quasi-real (tied to the physical world) and some is perceived or soft value. For instance, real estate is tied to the physical world and some perceived value. Watching a movie has mostly perceived value and does not deplete the physical world significantly.

(We won’t consider the criminal activities of theft or fraud where the flow is interrupted for no exchange of value.)

So if you are running a business, you need to access the flow of money by intercepting it. There is no limit to the number of times the flow of money can intercepted as long as it stays in motion.

You do this by creating a product or service that has value. If what you do has value you can get paid for it. People will buy your value as long as the price is less than the cost. The more value you generate for that person, the more flow of money you can intercept.

So one customer, one transaction transfers value to your customer and in return you get money. If you have repeat business, the one customer will periodically get value and give you money.

To increase your share of the flow, you can either create more value for each customer or you can increase the number of customers you have (or both). The number of customers you have is your reach. The more people and customers you reach, the more value you are creating in the world and the more money you can intercept in the flow.

But you don’t keep that money. You have staff to pay. You have other expenses. You have pay taxes.

The money flows out to others who provide value and intercept the flow.

This happens over and over and is the basis of the giant flow.

Money is in motion.

Why There Is No Shortage

Some physical things in the world actually do have a physical shortage. For example, there is only so much real estate along the coast of California. If you want a private home on the beach you have to convince someone else to sell it to you. However, this is only valuable if people want it.

For much of the stuff we consume, there is no physical limit (at least that we have to worry about right now). There is no limit to how many people can watch a TV show. There is no limit to the amount of massages that can be given. The pace of the creation of these types of goods and services is increasing as is the perceived value.

In the case of money, there is no limit to the number of times it can be intercepted or the amount that can be intercepted. How many times has that twenty dollar bill in your pocket been exchanged? It is a simple formula: create value, get customers, and intercept the flow.

The rich don’t sit on hoards of money like some crazy scrooge. They spend it and invest it. The investing of money means more spending and the creation of more jobs and more flow. The rich have the added benefit of being able to tap into the flow in more ways, in greater quantities.

Both of these activities increase the flow of money and the number of opportunities to intercept it. Since money is an artificial creation and no longer tied to the real world, there is no limit to how it can flow.

There is no shortage of money, only a shortage of flow.

And most times, the shortage of flow is only an attitude.

As long as you can generate more value (real and perceived) for people than you take out in money, there is no real limit on how you can tap into. Similarly tapping into the flow does not really take away someone else’s ability to tap into the flow as long as they are generating more value than they are taking out.

“Your income is determined by the value you create for each person and how many people you impact or touch with that value.” Bob Burg

(Continued in Part 3)

How Money Really Works - Part 1

Have you ever heard someone say that there is no shortage of money, in fact there is an abundance of it? This is what the rich understand and the poor do not.

I’ve heard it quite a few times, several times in the last week alone.

What does this really mean? I had to really think about it too.

The following is my take on what they mean about how money really works. Like most things, there is a reason it is important and some important lessons to be learned that go with it. So I encourage you to stick with all the parts.

How Many People Think Money Works

There is a giant pot of money which is divided between all of the people. Rich people get a lot. Poor people don’t get much.

The attitude that results from this is that money is greed. The thinking goes that if I have a lot of money someone else can’t have as much. There is a finite amount and it is divided between haves and have nots.

 
Exactly how many pots of money do YOU have tucked away under your bed?
If you are like most, not much. Some change in a jar. Some cash in your wallet. Maybe a little tucked away at home on your dresser. You certainly don’t keep your entire earnings or wealth at home.

Money is Really About Value and Flow

Money is an artificial man-made construct to aid the exchange of goods and services… or the exchange of value. It only has value because we as a society have set up rules and given it value. It is a means of exchanging value without having to resort to direct bartering (a visit to the dentist for a cow).

Money is in constant flow.

You work to create some value for your employer. In exchange for this value you get paid money. The value you create for your employer should be larger than you get paid otherwise it would not make sense to keep you around.

The government takes a percentage of this as taxes and uses it to purchase goods and services (things of value) effectively redistributing your money.

You then need to buy things (of value) to live and survive:

• Shelter (mortgage, rent, utilities, more taxes, etc.)
• Food
• Clothing
• Etc.

This is your non-discretionary income. What is left over is your discretionary income.

You have two choices for dealing with your discretionary income.

• Option 1: You can spend your money on things you perceive to have value to you (entertainment, physical goods, services, etc.).
• Option 2: You can save or invest your money.

So money comes in and money goes out. This is the flow of money.

In reality money also flows in bursts as you get paid and spend it. It also flows in cycles over the year.

You do something of value (unless you are a thief or fraudster), get paid a fair amount for that work, product or service and then you in turn purchase things of value.

 (Continued in Part 2)

New Fables in Biz - Tortoise and the Hare

The classic tale written as a business case study.

The tortoise and the hare were the two main direct competitors in their industry. They were focused intensely on one-upping each other and acting invincible to smaller players.

The tortoise was slow and steady. He was adverse to risk and sought to keep competitors away by putting a wall around his products and services. It was hard to move fast with all the baggage he was carrying with him. He was really good at copying the innovations of others.

The hare was fast and willing to take risks. Unfortunately, the hare was missing focus and got distracted by new things easily. She quickly built new products but would often lose interest in them if they didn't take off right away, allowing the tortoise to steal market share over time.

The tortoise and hare decided to have a race to decide who would be the winner once and for all. Just before the race started, a fox gave the hare and the tortoise each a cool new gadget. It was a cutting edge smart phone with a GPS, camera, and music player built-in.

The race started and the two were off and running. The hare of course burst way ahead of the tortoise and in 30 minutes was 2/3rds complete the race.

The hare thought she had lots of time since the tortoise was miles behind so she decided to stop and play with the new smart phone and finish the race later.

The tortoise was moving slow because he had to carry his shell with him so he started playing with the new smart phone as he plodded along. He saw the value of the new product and was wondering how his company could copy it and maybe something even better. He was so focussed on this task he accidentally missed the turn and ended up on the longer path. He was still plodding along with belief he had all the time in the world.

The fox was smart, fast and hungry. He used the built-in GPS tracking to find the hare where she was sitting and playing with her new toy. The hare had her earbuds in and didn't hear the fox until it was too late. All the speed in the world can't help if you don't see or hear the warnings.

The fox ate the hare for lunch.

The fox knew he couldn't take on the shell of the tortoise directly so he helped keep the tortoise distracted so he would think he had all the time in the world and could continue trying to win the old race.

The fox created a new market with new demand seemingly out of thin air. It was an entirely different race.

The hare was easily distracted and disappeared from the market entirely.

The tortoise is still there trying to win the old race, far too late to market and protecting his old world.

The world is wide open to the hungry fox.

Lesson:

What brought you success in the past, is not guaranteed bring you success in the future. Innovation must be continous and timely.

Which character is your business?

Proof that Values, Purpose and Culture Are Important

Lisa Petrilli offers real proof that successful companies consider their values, purpose and culture to be extremely important. Not only that they live and breath it.

What CEOs Really Think About Values and Culture

This is something I have believed in strongly for quite a while and have even been building into our new product; because it is important.

What is your experience and thoughts on this?

Buying Attention In Social Media - Does It Work?

As soon as something becomes popular, someone tries to figure out how to make money on it. Nothing wrong with that... that is a free market in action.

Social media platforms like Facebook, Twitter, LinkedIn, etc. are essentially free for the end user. The companies building and running them can't afford to do so forever without a revenue stream. So free means harvesting the data and selling it in some way, shape or form; and some advertising.

Businesses in general are experimenting with how to interact with customers and potential customers via these platforms. Some have been remarkably successful which is causing other businesses to take note and try and mimic their success.

This is tricky in social media as people use it to interact and connect with other people. It mimics and enhances people desire to connect with others, positively or negatively. Too much of the wrong thing can backfire.

One mechanism companies are using is to essentially buy, at least temporarily, attention from people. Giveaways, contests and discounts if you like a page on Facebook, Tweet or Retweet on Twitter, blog etc. Let's face it, we love free stuff or a good chance to win free stuff, even if we would never buy it normally.

Jeff Nelson (a savvy SEO and social media guy) from Anduro Marketing is running a campaign for one of his clients to show them the power of social media. (He asked us to help him out so I am doing a little case study on it as part of my blog because there is something to learn for any business owner.) In my opinion, this client is an excellent example of a company that can be successful on social media because it meets three key criteria:

1. It is consumer focused,
2. It is a high touch, relationship based business,
3. It is the type of business that people come back to regularly.

The idea is to build and maintain the relationship on social media, not to ram advertising down your followers throats; or they will un "like" you faster than you can blink.

In case you are curious, the company being promoted is Oasis Spa and you can check out their Facebook page to understand their offer. I don't know the company myself and I am not a spa person. But if you or your business likes to give these things away, their promotion is for nice package "gift certificates" at three different levels. If nothing else you can see a campaign in the making and learn from it.

So does buying attention in social media work? It can if you structure it right and figure out how to connect longer term.

Does it work for you? Let me know in the comments.

Losing Focus On Your Goals - Those Pesky Little Distractions

The other night I woke up with a burning sensation in my left eye. It felt like something major was in there and my eye started watering like crazy. I spent 30 minutes flushing out my eye to no avail.

I was starting to think I would be heading off to emergency. My eyes seem to attract problems for some strange reason. I was also thinking there go my business plans for the next few days.

From past lessons I knew that rubbing is very bad. Scratched corneas take a while to heal and are quite painful.

I decided to have another go at finding what was in there. A small flashlight in one hand and trying to grab my eyelid (not trivial as you know) with the other I finally found the culprit... a tiny piece of dirt. The only problem was, I needed a third hand to remove it.

In the end I memorized the location of the particle and put the flashlight down. A small moist piece of kleenex and a few blind attempts and I immediately knew I had gotten it. Instant relief.

Losing Focus From Your Goals

This little incident reminded me that the smallest things can cause you to lose sight of your dream, vision and goals. A little irritant and we are off totally focused on solving that problem instead of doing the things necessary to move us forward on the big things.

This happens all the time in business.

Solving the little things is immediately satisfying. Instant relief from the irritation.

Working on your goals and vision is longer-term and the pay off is further out.

I am reading Grant Cardone's "The 10x Rule" right now. He recommends:

• Setting your goals 10x bigger than you think you need them. This keeps you motivated and even underachieving is satisfying.
• Massive effort (10x what is normal or what you think is reasonable). This will help blast you through the distractions and difficulties ahead.

It is also important to build fun and rewards into the entire process of achieving your goals and vision.

Doing these things will keep you motivated and focused along the way and help ensure the those goals are not just wishes.

What are some of the pesky little things holding you back and how are you staying focused?