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Knowing vs. Knowing

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They’re vastly different things.

The ancient Greeks had two distinctly different words for knowledge. One of them is good for business owners, the other one, not so much.

A Tale of Two Words
Gnosis is the ancient Greek word for “knowledge of the head” – 2+2=4. The sky is blue. Gravity sucks. Plants need water. All good stuff to know, but not nearly as powerful as the other kind of knowledge.

Epignosis is the ancient Greek word for “knowledge of the heart/life”. This is voodoo of a different kind and is much more valuable to the business owner. Epignosis is not something you know to be a fact, that can sit in your head unused for decades. Epignosis is applied knowledge. It’s knowledge that directly affects the way you live and act every day. You don’t know it, you do it.

As a business owner we know things with our head that are interesting, fascinating, boring, essential (profit is good, loss is bad), and some of it very complex. We love complex knowledge – understanding markets, watching trends, researching possible products and services – because it all takes a lot of time to learn and makes us feel smart. Even other people are impressed when we talk from our head knowledge about these things.

Get Real
But Epignosis, knowledge of the life, is a special thing and should be cherished by business owners. It is that knowledge on which we act and build a business. Things like calling people because we “know” if we do, some will buy. Or building connections with strategic alliance partners because we “know” they can rain on us for decades with clients. Or getting out of our office and serving our clients or other business owners because we “know” that helping others get to their goals ensures our own success.

We know that we have Epignosis about something because it affects the way we do things. Gnosis is only about what we know in our heads, but Epignosis goes to the very heart of what we BELIEVE (more on that next week), and it is our beliefs that determine our actions. If I believe bicycling will make me fit, I will do it regularly, not think about it. It’s true Epignosis.

I Say Tom-ay-to, You Say Tom-ah-to
The problem is that we get the two confused all the time. We think that knowing something with our heads (I will be successful if I make those phone calls) is somehow valuable. But knowledge of the head is only valuable when it comes out our hands as knowledge of the life.

Successful business owners have a special relationship with life-knowledge, Epignosis. They go looking for the kind of knowledge that can be immediately translated into action that builds their business. Those that struggle are much more inclined to research, think, strategize, analyze, postulate and theorize. That kind of Gnosis may be very satisfying and impressive, but it will leave you poor. When it comes to Gnosis, the old adage, “Knowledge is power”, is wrong. If knowledge (Gnosis) were power, librarians would rule the world.

In Your Head, Out Your Hands
Life-knowledge makes us do something, not think something. It is at the core of Conation – Committed Movement in a Purposeful Direction (CMPD). Conation is the most important business word you’ve never heard because we live in a world ruled by Cognitives, Thinkers – Gnostics who loving knowing but not doing.

Want to be successful? Fall in love with Epignosis. Every time something goes in your head, figure out how it can come out your hands to help you build a better business. Translate Gnosis into Epignosis – it’s a great way to build a business. Stop thinking. Get moving.

Two things a business owner should never do.

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The 2nd is worse than the 1st.

One of the worst things you can ever do is write a business plan. But easily the worst thing you could do is follow it. It’s a great way to go out of business. It’s the 97% rule.

97% of all businesses leave their prime objective in order to find the thing that eventually makes them money. Good businesses almost always start with a bad plan.

You just can’t make this stuff up.

Harmonica Tuners Gave us Silicon Valley
In the late 1930’s two guys started a company for $538 and were messing around in a garage. They made an automated bowling lane violator, a harmonica tuner, an automated toilet bowl flusher and a few other stupid products. Somebody came along with something called an oscillator and asked them to build it. They didn’t think it was a very good idea, but that bad idea became the first thing they made money at – HP was born and became the foundation of silicon valley.

Model Rockets Gave us the First Personal Computer
In the very early 70’s a couple guys were messing around with a simple automated launching system for model rockets. They put the kit in a magazine and thought they would sell a few dozen. They sold thousands. They used that experience to focus more on technology than on model rockets. In 1975 they put another kit in a magazine for something called the Altair 8800, and thought they would sell a few dozen. It was the first personal computer and it sold thousands. They ended up building the kits and selling them as finished computers. Five years later this stuff became the basis for Microsoft’s Altair BASIC language.

HP Gave us Apple
Around the same time some 12 year old kid called HP and demanded to talk directly with Bill Hewlett because he wanted to buy parts (for his Altair?). Bill took the call, was really impressed and a few years later gave the kid an internship. Later in his life that kid, Steve Jobs, who also met Steve Wozniak at HP, said, “Without HP, there would be no Apple.”

Xerox’s Business Plan Gave Apple the GUI
In 1979 Jobs visited Xerox and saw something called a graphical user interface – GUI. Xerox invented it but couldn’t find it on their business plan, so they sold it to Jobs for $50,000. Bill Gates visited Apple later and poached the idea.

All of this, from the 1930s to the 1980s involving a few dozen people from all walks of life in many different places, came together to give us the personal computer. It wasn’t on a business plan, and the only guys with a business plan – Xerox – ignored it because it wasn’t on their business plan.

Bagels or Ice Cream?
Ben and Jerry make ice cream. What few people know is that the ONLY reason they make ice cream is that a bagel machine was too expensive. They were all set to go into the bagel business but hadn’t bothered to price out the machine. When they did, they found out an ice cream machine would be cheaper, so they did that instead. Wasn’t on the business plan.

Panty Lines or Millions of Dollars?
Sara Blakely looked in the mirror just a few years ago and saw panty lines under her slacks. She couldn’t find underwear that didn’t show, so she started Spanx, which is now a huge international clothing line success. Not a business plan – a mirror.

Webvan Followed Their Plan
In the late 1990’s Webvan decided people would buy groceries on the internet and have them delivered by van. They put together one of the most elaborate and detailed business plans ever concocted, raised $2billion, hired the best talent in the technology and distribution businesses, and followed their business plan right off the end of the earth. They took $2billion of investor money with them – a lot of people were really impressed with their business plan.

Let it Collect Dust!
97% of businesses leave their prime objective to become profitable. Webvan stuck to theirs, none of the others above had one, or if they did, they left it behind as the world interacted with their “plan”. If you can’t help yourself and just have to do a business plan, at least have the common sense to put it on the shelf and ignore it like most people.

You won’t find success in a business plan or in an MBA program. You’ll find it in the trenches by being willing to adapt and execute exceptionally on what may seem ordinary or throw-away ideas.

Do Something.
Ask the successful people. It’s never how good your plan is that matters. It’s how committed you are to the bad plan you’ve got.

Speed of execution. Stop planning. Get moving.

Lewis & Clark – Your Best Business Heros

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Maps are over rated.

Don’t look at IBM, Starbucks or Facebook to see how to start and grow a business successfully. The adventures of pioneers Lewis & Clark 208 years ago are the prototype for all of us. Things don’t often work out as we planned. Most often what happens instead is the good stuff.

In May of 1804, Lewis & Clark were given the mission by President Jefferson of finding a water passage from St. Louis to the Pacific ocean. How they approached fulfilling that mission is one of the best business start up examples in history.

Lewis and Clark were masters at planning as you go – what we call the 2.1 Planning Process. They only knew 2.1 things:
1) Where are we? – St. Charles (St. Louis)
2) Where do we want to end up? (the Pacific ocean)
2.1) What are the next few steps? (get a boat, hire a crew, leave)

Just the next few steps
You never get all of step “3)”, which is HOW to get all the way from step 1) to step 2). You only get “2.1)”. Traditional business planning teaches us that HOW you get all the way from 1) to 2) should be planned before you leave. But it’s voodoo, nonsense and fortune telling.

Just like Lewis & Clark, we never get all of step three, and you definitely don’t get it before you leave the dock. All we get is 2.1 – the next few steps.

On the third day of the trip, Lewis and Clark’s main vessel nearly capsized which would have ended the trip. Their experience even on waters others had traveled before was vastly different. Sound familiar? The other guy’s business experience won’t be yours – don’t let him tell you how it should go.

Lewis & Clark planned for the first few miles and could only guess at what they needed to take with them beyond that. All they could do is plan the next few steps and get moving.

Movement beats planning
They took off with 38 men and three boats but could have easily taken 1,000 men and 100 boats. Looking back from the future, we know this wouldn’t have helped them, and all that over-planning would have in fact made it even harder to move quickly, support such a large contingency and survive the winters.

This is where we miss it big time – over-planning before we even get moving. Lewis & Clark only figured out what they needed as each new obstacle presented itself. After planning as best they could for the first few steps, they simply had to be willing to make constant and quick adjustments or they would have perished. Every business has to have the same willingness to get moving and take soundings as you go.

Long-range planning doesn’t work
If you read the adventures of Lewis & Clark it reads like everything from a sappy novel to a National Lampoon comedy to an Indiana Jones movie. No business plan would have uncovered 1/100th of what actually happened.

They thought it would take 12 months, but 2 1/2 years later they stumbled back into St. Louis where people had long since written them off as dead. They thought they would float in big boats all the way to the Pacific but ended up in wagons, then canoes, on horses, walking, back in canoes, back on horses and wagons, all the while hoping they would find locals who they could trade with to get these things. They were making the whole thing up as they went along.

On they way back, only one month from the safety of St. Louis, Lewis was shot in the touche by the near-sighted, blind-in-one-eye Private Cruzatte who thought he was an elk. You just can’t make this stuff up. And you can’t plan for it either.

Pursue the first thing to find the real thing
Businesses almost always find what they will succeed at by failing at their first objective. Lewis & Clark had one main objective, find a navigable passage from the midwest to the Pacific Ocean, connecting the Mississippi to western oceanic trade. They utterly failed in their main objective. Yet pursuing that objective led them to multiple huge successes; mapping thousands of miles of land, treaties with Indians, identifying and naming hundreds of plant and animal species and opening up a whole new land for exploration. They gave courage to a whole generation who would follow in their steps, and rough maps to begin the journey.

And as with any business, those who followed the same route as Lewis & Clark had entirely different adventures. No two businesses can follow the same plan, even in the same industry.

Move the boat, then make the map
But the best correlation between Lewis & Clark’s adventure and your business is the answer to this question:

When did they get their maps?

The answer? When they got back.

Take the first step, then do it again and again
The best way for you to know how your business will unfold is to know exactly where you want to go, leave the dock and get moving, be flexible and adaptable, make it up as you go along, and grab the opportunities as they unfold. The thing you thought would be your main business will almost certainly grow into something you could have never seen from the dock.

Don’t know what to do to get all the way from here to there? Figure out what the next step is, even if it is a guess, and do it. Then do it again and again. Always know exactly where you want to end up, and take a thousand first steps to get there.

We usually find the good stuff by wading through the muck we thought was the good stuff. A map would take all the fun out of it. You’ll get your maps when you’re done.

Always release your product before it is ready.

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Movement, not Planning.

Want to be successful? Get your product or service out there now, not after you’ve refined it and made it good. The MBA programs are wrong. Get moving.

Facebook sucked when it first went live and changed almost daily.

Google was a bare bones search engine called BackRub in 1996 and was still simplistic when it became Google in September 1998.

The Denver “T-Rex” redo of the entire highway system was 25% completed and open for traffic before the design was even completed.

The only way to learn how to run a four-minute mile is to first run something much slower, in public.

To learn to ride a bike, first, fall off.

Committed Movement – It’s never how good your plan is that counts, but how committed you are to moving on the bad plan you’ve got.

Purposeful Direction – We don’t need to know HOW we’re getting to our objective, we just need to know what our objective is, and the next few steps in the right direction to get there. Purposeful Direction is not about having things figured out first, but simply knowing with utter clarity where you want to end up.

Committed Movement In a Purposeful Direction is more critical to success than anything else.

There is a fundamental lesson about life and business in the above statement, and how we take that lesson on board makes us either very successful, very average, or a real shipwreck.

Successful people understand that planning is like a rudder; it’s useless without movement. Highly successful people have a very clear, transformational understanding of the relationship between movement and the rudder.

If you get your relationship right between these two, it will transform your life and your business as well. If you don’t, you’ll stay grounded on your sandbar and wonder why your life never had the impact you’ve always known it can.

The idea of massive pre-planning before you start seems to be a very sound practice, but only in concept and in business school. The problem is it just doesn’t match up with the reality of what actually makes for a successful business.

In the last three years I have watched four different companies go through the whole focus group/product development/perfect rollout process that most MBA programs and books about success would tout as the right way to do things. They all failed. I’ve seen others become successful by just getting moving in a small way like Facebook, Google, eBay, the sticky note, the television, the car, the internet, the steam engine, and all parents, all of which had a better chance of success by releasing the product before it was ready then by perfecting it first.

A controlled experiment in the real world
The key is to do it with very few customers who love you and want to work with you to make it what it will someday become. Reality is a much better laboratory for business than the laboratory. Customers are a much better focus group than a focus group. And a small rollout to the faithful is much less expensive and more informative then the balloons and parade approach.

We went through many iterations of paid workshops and mastermind concepts for three and half years before we arrived at 3to5 Clubs, which are now spreading on four continents. But we did it in small groups where perfection wasn’t necessary and everyone of the faithful were served with our existing but under-developed product.

Speed, not Planning
Success is much more closely related to Speed of Execution than to in-depth planning, because most planning is done in a vacuum prior to actually producing anything. Only after the plan hits the real world do we find out that it doesn’t work in that real world.

In the face of that reality and all the evidence we have that massive pre-planning is a waste of time, we keep trying. We can’t help ourselves. Hope springs eternal. In the meantime the Facbooks, Googles, and T-Rexs of the world are in their boats running flat out and heading for open water while we’re still trying to decide how to build the rudder.

Man has yet to devise a great way to plan in the absence of movement. The painstaking detailed analysis we are all taught to do before we move is almost always of little value because it never works out the way we had hoped. And as a result it never saves us the time and money it was supposed to. Instead it usually costs us precious time getting started, puts us behind someone else who has decided to get moving, and creates soaring costs down the road.

Practice, not Perfection
Always roll out your product or service long before it is ready, before your website is done (we only had a holding page for the first 18+ months). Just do it in a controlled but very real and “live” environment where the feedback you get is from real live bullets – people deciding to pay with real money and giving you feedback on how to get better.

Get out of the lab and into the real world. Tom Watson, founder of IBM said, “Test fast. Fail Fast. Adjust Fast.” I would say get out into the real world and just keep practicing to get better all the time.

Building a Business is Really Simple

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Get out of the garage.

My friend Alan Wyngarden has done some adventure travel and says: “The hardest thing about climbing a mountain is just getting out of the garage.” Huh? Actually, it’s pure genius.

A year ago I shared a business concept with Alan around building intimate assisted living homes that I had heard about.

I didn’t have the inclination to do anything with it but wanted to see if others I knew might benefit from running with it. I shared it with a number of people who loved the idea, but only Alan gave birth to it.

Yesterday I attended the open house for his first home. It is gorgeous and Alan has the best people in the industry working for him, creating a unique, honoring and beautiful environment for those who need a little assistance at an advanced age. It even has raiaed gardens for them to plant without bending over – great stuff.

I chatted with Alan about this last summer and within a week he was moving on the idea, with the full dream realized yesterday, only a few months later. The others who thought it was a great idea never moved on it. Alan is thinking he’ll have five of these homes up and serving the elderly in the next year or so.

Building a business is really very simple. You just need to get out of the garage. As with climbing a mountain, the training isn’t the problem. It’s leaving the garage to DO the training that hangs us up. GETTING STARTED stops us more than any other thing in business. If we would just get started the rest of it would fall together for us.

But we wait. We research, we talk, we think, we plan, we collect data. We believe we need to get it all figured out before we move. But neither life nor business works that way.

Planning never creates movement, but movement can create a great plan.

Alan had no experience in the industry when he started moving. He just got out of the garage and started looking for a property, then started sniffing around to find those who might be able to help him build an expert team.

By the accounts of others who have been in the industry for years and who own many of these types of homes, he’s hit a home run with both his facility and his team. He didn’t get there by reading. He got out of his garage. And that movement created a marvelous plan.

Building a business is really quite simple. We just need to get out of the garage.

Speed of Execution is so important to success. What great idea are you sitting on that you just need to get out of your garage and get started?

Education Is Not Important For Success

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Learning is not education.

Sitting in a hotel lobby in Martinborough, New Zealand after a bike ride, two professors from Vancouver asked me if I thought education was important for success. They hit my hot button. If, like the old saying goes, knowledge is power, then librarians would rule the world. They don’t. Something else is more correlated to success than education.

Millions of higher degree recipients make less during their careers than people who dropped out of high school. And millions who never finished high school make huge impacts and a lot of money.

We miss cause and effect all the time. As an example, people love to say, “College graduates make a million dollars more in their lifetime than non-college graduates.” Is it because they went to school, or because they are motivated to do anything that will make them successful? I think it’s the latter.

If they were told they needed to apprentice with a businessperson they would do that instead of getting an MBA (that would be my advice). They are motivated and committed, and will do whatever they have to in order to be successful.

There is some clear correlation between education in the hard sciences (pharmaceuticals, engineering, plumbing, etc.) and success. If you violate hydrology ($%@* flows downhill), you’ll make a lousy plumber. But there is little correlation in the soft sciences. People build committed communities all the time without ever taking a sociology course. Others help people get past their bad habits without ever taking a psychology course.

Business is one of the soft sciences where education is least correlated with success. Dropouts from college (or people who never went) start hugely successful companies all the time. “Is college necessary?” is becoming a mainstream question.

What makes business owners successful? According to research, education doesn’t show up in the top five. (Entrepreneurial Intuition, an Empirical Approach, La Pira, April 2010), but these do:

  1. Seeing the big picture – being a visionary is most important. If you can’t see it, you won’t shoot for it.
  2. Speed of Execution – taking action while others are researching.
  3. Never giving up; being the bull dog; finding a way to make it work.
  4. Being a life-long learner.

Learning is massively different than being educated. Education fills our heads with information, while learning transforms our lives and the world around us with grounded and applied intelligence.

If you want to have your head filled with facts, get an education. It you want to learn, change lives and/or make money, you’re better off apprenticing with someone who’s done it. They won’t try to educate you, they’ll just make sure you are effective and becoming something you aren’t, yet.

The Greeks were wrong.

We don’t think our way to a new way of acting; we act our way to a new way of thinking.

Go do something with someone who’s already done it; and learn from their experience.

The Vancouver professor’s responses? “Check, please.”

The Holiday Advantage

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Getting Ahead When the Rest are Resting

Assumption – December is a black hole for growing our businesses. We might as well just relax & make peace with it. Not really.

Reality: People are busy at night and weekends but their workday has slowed way down. They are waiting for you to call! It is head trash and/or anecdotal business lore to think that we can’t get great results in December. Last year I had three appointments a day between Christmas and New Year’s (this year I’m taking it off!).

Speed of Execution is the #1 indicator of success in small business. While the other rabbits are taking a December snooze, keep the tortoise moving – make money in December and set up your January to revenue-generating, not planning.

Here’s ways to build your business in December:

  1. Do a seminar on managing credit – one of our clients did it last year on Dec. 22 in the afternoon and had 100 people come – three days before Christmas!
  2. The forgiveness factor – Holiday hellos to stale contacts – great excuse to reconnect.
  3. Forgiveness factor newsletter – Teach your power partners/gate openers to reconnect using Holiday Hellos. Box of chocolates with their Name/logo to give to someone they need to reconnect with. Over-sized chocolate bar; funky desk calendar; holiday wrapping paper. Opens the door for them to call me, get coffee, re-establish the business relationship.
  4. Client appreciation events DURING THE DAY – Holiday goodies, gift-wrapping – ongoing if you have a retail location. A little live music is always a great addition. You can send out an e-mail invitation with all the details.
  5. Host a planning event Host a planning seminar for next year (get a futurist, CPA, etc.)
  6. Take on a charity as a company and get everyone involved. Donate a day as a company. PR consultant-newspapers. Write article, frame it, hang it on your wall, email to your list.
  7. Press Release – Holidays offer a great excuse. Newsworthy idea – great PR exposure. Called piggybacking (on the holiday theme) Here’s some ways:
    1. Make donations in honor of your customers. 10% of profits for one week to the American Cancer Society. Or donate employee time.
    2. Give something back Offer an award (for someone you admire, courageous kids, notable givers, create a scholarship) – dinner and a ceremony.
    3. TurkeyPardon.com – Pardon a turkey, put a camera on it and YouTube, then give it to a petting zoo after the holidays. You can borrow TurkeyPardon.com from me at no charge (1st one to ask).
    4. Holiday poll – Poll/survey and announce results. What business owners really want for the holidays, biggest complaint about holiday shopping? Or something from perspective of your business – get a PR person to shop it to the right audience. Email/send results.
  8. Hand delivered gift cards from a local coffee shop or restaurant. Get an appointment to go with them!
  9. Send a watch – “Happy New Year! It’s about TIME we did some business together.”
  10. Send a New Year’s card – don’t get lost in the Christmas card shuffle – and everyone celebrates New Years.
  11. Crystal office candy bowl Send refresher candy 3-4 times a year at other holidays. Their name engraved.
  12. Offer gift certificates ($25 billion last year – 15% of Holiday revenue!) Carpet cleaning – a great gift certificate! Make the offer for your slow time of year.
  13. Tie your product/service to the holidays – What do people need from me during the holidays? Do they need more balance, a time to relax, a plan for how they’re going to do something better in the coming year? Insert yourself!
  14. Organize a shopping trip for elderly clients PLUS THEIR FRIEND (CPAs, Fin. Planners; anyone with elderly customers).
  15. Bonus ☺ – February 18 – Chinese New Year celebration event Cultural experience– a slower time for activities. How many people would go with to an event where a Chinese person could teach us those traditions?
  16. For Yourself – focus on your Loyal Customers and Raving Fans – do something for them. Do some simple strategic planning for next year. Find out what your Big Why is. Establish a Business Maturity Date. Develop a simple system to streamline your operations. SET APPOINTMENTS FOR JANUARY 3rd RIGHT NOW (don’t’ wait until January – hit the ground running!). Or just relax and enjoy family.

Happy Holidays!

The #1 Indicator of Success in Early Stage Businesses

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Move Quickly

Very few business owners expect their business to support them right out of the gate. More often than not, the expectation to receive income from outside the business gives the owner a false sense of security and a lack of real intentionality to build a business. We assume it’s supposed to be this way, and if we look around at other business startups and some of the really awful advice we get, we’re told it could be 18-24 months before the business even breaks even. So we take that 18-24 month window and use every bit of it, burning through outside money like there’s no tomorrow, and feeling just fine about it because it’s supposed to be this way.

A great friend of mine and fellow business advisor in Virginia, Eddie Drescher, told me about one of his clients who had one fitness franchise open and was about to open another. The national franchise had told him it would take 12 months or so to be profitable because that’s how long it took them.

As this client was about to open his second center, he told Eddie about this timeline. Eddie immediately challenged him, saying, “Who made that rule?” After talking through it at length, they decided to shoot for profitability in the first three months. Instead the location turned a profit in its first month, and stayed close to break even in the following few months. Rather than burning cash for 12-18 months because he was “supposed” to, he intended to do something much better much sooner, and did so.

Speed of Execution

I believe strongly that the number one indicator of success in an early stage business is not how good your product is, or how smart your marketing is, or your uniqueness, or your funding, or any of those traditional ideas of what makes for success. The number one indicator of success in early stage business is simply speed of execution.

Think of that successful six figure sales person you know, or that business owner who seems to turn everything they touch to gold. Almost certainly they are people who, when they get an idea, move on it immediately. Most of us spend way too much time thinking, researching, and planning. We would be better off getting a very basic plan in place and acting on it, and perfecting it as we go.

It’s the subject of my next book, but for now I can’t encourage you enough to just get moving! Stop thinking about starting up, and if you’ve started up, stop thinking that it’s supposed to last until the end of your cash, then magically switch over to funding itself.

Get intentional about getting your business through startup as quickly as you can. And whatever stage of business you’re in, keep Speed of Execution as one of your top business principles. You’ll make more money in less time.

Why Systems Focused Owners are better business builders than business starters.

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Last week we tried to give perspective to the idea that being the classic Market Focused entrepreneur isn’t all it’s cracked up to be. This week we’re looking at why Systems Focused managers are great business builders but aren’t such great business starters.

There are three basic business owner profiles:

  1. The Market Focused owner
  2. The Systems Focused owner
  3. The Product Focused owner

Every owner is a mix of all three, but we all lean heavily on a primary profile for the way we manage and make decisions.

Systems Focused owners are just that – focused on systems, process, procedures, routine. They look at business from the inside out – from the point of view of operations and delivery, not from the point of view of the market or the customer. Make a consistent product at the right margins and you’ve got a good company, so the Systemizer thinks. They’re not always passionate about the particular product or service they’re selling, but they are very passionate about operations itself.

They’re big on research and planning, usually wanting to make sure they’ve thought of everything, and as a result, are usually very risk averse and slow to make decisions. Speed of Execution is not their forte’. They make great managers, administrators, academics, scientists, and engineers. They are absolutely vital to a business growing to maturity, but it’s rarely a good idea for a Systems Focused person to be strike out on their own to start a business.

The Systems Focused person is usually very good at understanding how a business should run, so they think that translates to being good at starting a business.

Rarely.

Because Systems Focused owners are such great planners, this ironically works against them in starting a business. That great research and planning instinct also contributes to their usual great aversion to risk. These two things usually combine to make Systems Focused people very bad at starting a business.

The #1 indicator of success in the early stages of a business is not how great the planning was, how perfect the product is out of the gate, how knowledgeable we are about our market, or how much money we’ve sunk into the project. The #1 indicator of success in the earliest stages of a business is Speed of Execution, which, along with risk aversion, is the biggest challenge for a Systems Focused owner.

Systems Focused owners will miss opportunity after opportunity making sure their operations are well oiled, their marketing is perfect, and their delivery mechanism is seamless. And until they get it right, they won’t pull the trigger. Their unwillingness to move until conditions are perfect (risk aversion) will drain their startup capital and leave them miles behind their competition at every step.

The Systemizer lacks vision for the future (too busy researching the past) and urgency for today’s production. If the Systemizer recognizes their strengths, they’ll get the influence of a Market Focused person to help them keep tomorrow in focus, and the influence of a Product Focused person to help them get a sense of urgency about today – Speed of Execution. If they can do this, their likelihood of starting and growing a mature business will go up exponentially. FYI – they do much better buying a franchise (with good systems in place) or existing business, than starting a business from scratch.

Next week, we’ll talk about the third profile, the Product Focused owner; the one who starts the overwhelming majority of businesses, and has a better track record doing so than the other two. But growing a business to maturity? That’s another story.

3to5 Club – Is there a Business Maturity clock ticking in your business?

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I know what my business looks like when it’s mature and I know to the day and hour when I plan to get there. And it won’t take as long as you think. What’s your Business Maturity Date?

What we talked about 2 weeks ago is too important to not repeat as a setup for this week’s conversation: We think our purpose in business is to make money when our purpose in business is to BUILD A BUSINESS that makes money when we’re not there. These two things are worlds apart, and almost every business owner I work with is absolutely buried in making money, which will keep them from ever making a lot of it.

Why? Because we can’t find the proper balance between the Tyranny of the Urgent – things we have to do to personally make money today; and the Priority of the Important – building a business that will make money for us w/out even being there.

We never have a problem with the Tyranny of the Urgent. Got to pay the bills – It comes rushing at us every morning like a locomotive with a stuck, screeching whistle, while the Priority of the Important (building a business that makes money when we’re not around) sits quietly in the corner of our minds, waiting to be picked up and dealt with, never screaming; just a subconscious whisper in our ears, “Deal with me now and you’ll have fewer Urgent things down the road.”

It’s immediately drowned out by the screeching whistle, so we get sucked on board and spend another day riding in circles with cranky passengers, smoke in our eyes, shoveling coal and sweating it out, and wondering how to get off this cursed treadmill-like train that just comes back to the same place every day.

Here’s how:

Pick a Business Maturity Date. It’s that simple. What? Yes. Just pick a maturity date. It will change you forever. From a hostage to someone heading straight for freedom.

Two years ago this week, March 6, 2007, I started my business with a Business Leader’s Insight lunch workshop with 24 people in attendance, with the same fear and trepidation every one of you felt the day you opened your doors and for months afterwards – it’s not any different for anyone – don’tkid yourself.

But something is different. I have a Business Maturity Date that will take me past the startup fear and right through the “languishing” that most businesses resign themselves to.

In 3 years, 11 months, 2 weeks, and 22 ½ hrs. from when I started, I expect to be done building a business that makes money when I’m not around. I’ve got a lot of work to do and the clock is ticking relentlessly, the train is screeching, belching, and going in circles, and at the same time I’ve got little time left already to build this business to maturity.

My Business Maturity Date? Friday, February 18, 2011, at 10am – 1 year 11 months and two weeks from now.

On that day I will have a mixed Stage 6-7 business (more another time on the Seven Stages of a Business) with others running the day to day and me continuing on in content development and focused delivery. I know how much money it is making on that day and how much I will take home. It is very clear to me what Maturity means to my business on that day.

At 8:30am on that morning I will have a staff meeting and turn over the business to them to run, have an early glass of champagne with them, leaving the office in good hands, and be out of the office by 10am to pack my bags. At 6:10pm that evening my wife and I will be on a plane to Auckland, New Zealand, her dream vacation, for three weeks of celebration. We land in Auckland at 7:25am Sunday morning. The trip will cost $12,380.

Does it change you a little bit even reading this? Imagine what it’s done to me, and what it will do to you when you make the same commitment. It will change you forever.

There are three steps that, when we take them, we change:

  1. Decide something.
  2. Pick a date for when we will be done.
  3. Go public.

To help us all with this three-step process in building a Mature Business, I’m starting a new “club” that is a big idea and will need to be owned by everyone involved. It will certainly end up with committed, focused business owners in cities across the world. It’s called 3to5Club. The three requirements to become a member?

  1. Make a decision that a) you will stop trying to make money and will become committed to building a business that makes money, and b) you will define and describe for yourself what a mature business means to you (it has to make money when you’re not there as a starter.)
  2. Pick a date for when it will be mature (note: this doesn’t mean you sell it that day; you could sell it, keep it and start another one, use it to fund your lifetime goals, turn it over to your kids, or keep working in it doing just the very few things that make magic for you.) And pick a time of day, not just a day – it will make a Priority of the Important Clock start ticking in your head loudly to help counter the screeching whistle of the Tyranny of the Urgent.
  3. Go public. You won’t really change permanently until you take this step.

Why the name? I’ve come to the conviction that it is normal that any business could be grown from inception to maturity in 3to5 years (investors always want their money back in 3to5), 2 to 7 in the best and worst of circumstances. That doesn’t mean you have to pick something in that range. But if you go out 9, 12, 15 years, I believe the bar isn’t high enough to create the urgency you need to be intentional every day about growing your business. It will be too easy to lapse back into making money, a deadly trap. Be ambitiously lazy, get done quicker.

I believe by using the one motivator and two bosses we talked about last week, that it is quite possible my business will be at Maturity before Friday, February 18, 2011, 10am. But what if I miss that date? How do I deal with the fear I might fail? The head starts spinning. We’ll talk about this next week, and the week after we’ll deal with the hostage comment I made at the beginning of this blog.

Are you in? Will you join me in becoming charter members of the 3to5 Club? We’ll do a website and all that crap later. Let’s get started. I’ve set up a meetup.com group for Denver (http://www.meetup.com/3to5Club/), and we’re going to have a charter meeting on Thursday, March 27 at 11:30pm at PanAsia Bistro in Lone Tree, CO. I would be happy to help you set up 3to5Club in your city as well – just leave me a comment.

I’d love to be the first graduate of the 3to5Club in 1 year, 11 months and two weeks from now, but I’m sure there will be a lot of people who will beat me to it. I hope so.

What’s your Business Maturity Date? What does your business look like that day, at that hour? Go public right here in the comments section and let’s take it from there. Speed of execution. I’m looking forward to “executing” that locomotive as quickly as possible.