Monday 25 February 2013
Tuesday 19 February 2013
Why Lies in the Office Aren't All Bad
ying is bad, right? Especially lying to the boss. But sometimes a little dishonesty can be more helpful than you think.
Maybe George Washington couldn't tell a lie, but that probably
doesn’t hold true for your employees. The average person tells
approximately four fibs a day, and not all of them along the order of “yes, those pants look quite flattering on you.”
When employees lie, it's a serious matter. But sometimes a little dishonesty can be helpful to your business.
Charalambos Vlachoutsicos, an adjunct professor at Athens University of Economics and Business in Greece and a former businessman, writes about his experience lying to a superior in a blog post for the Harvard Business Review.
“One company I worked in while studying for an MBA at Harvard was an electric appliance wholesaler managed by its founder autocratically and whimsically,” says Vlachoutsicos. The bottom-line driven business owner purportedly ruled with an iron fist, demanding “sales now, no matter how” from his employees, who worked on commission.
Vlachoutsicos admits the competitive--and frequently dishonest--atmosphere that this policy created did not sit well with him. “Fairness has always been the cornerstone of my value system. So although I was selling aggressively, I was always emphasizing ‘honest’ sales… sales not obtained under false pretenses.”
So after attempting to curtail dishonest practices like claiming the company’s vacuums were the fastest on the market (when they weren’t) to no avail, Vlachoutsicos decided to tell a lie.
He called a meeting with his boss, and explained that one of the company’s biggest customers had called to protest after being “lied to” about the features of one of their products. This wasn’t true. No one had complained. But Vlachoutsicos felt that the company’s false advertising policy would backfire--and that they would lose business because of it.
By framing the issue in this way, and by being genuinely invested in the company’s interests, Vlachoutsicos was able to reconcile his values with that of his employer. He learned a valuable lesson in the process: “The truth is that effective management invariably involves a certain amount of manipulation," he writes. "You do not always get your way by being direct. Instead, you have to find a way to bridge the gaps between your values and the culture you work in."
Whether his boss realized it or not, this sort of revelation was exactly what made Vlachoutsicos a good manager and team leader--and what makes good liars (let’s call them “negotiators”) the kind of people you want on your team. They are the people willing to make creative compromises in pursuit of mutual goals--something that both you and your customers can appreciate.
The less noble lies that your employees tell--like “Yes, I’m right on schedule with that end-of-the-year report” or “I’m late for this meeting because my dog got sick right as I was leaving the house”--can reveal valuable insight into your company’s culture, as well.
According to Shawn Achor, CEO of the positive psychology consulting firm Good Think Inc., lies may indicate that the problem is you, not your fibbing employees.
“If a manager is unable to hear about negative things, confusion, or setbacks, then that manager is going to get lied to often," Achor says in an interview with CareerBuilder. "Good managers want an accurate assessment of the present, even if it is not good. Bad bosses want the semblance of progress in the present, at the cost of future successes.”
The next time you're ready to throttle an excuse-giving employee, pause a moment to examine the bigger picture. Are unrealistic deadlines the reason that he is behind on a report? Are her assurances that she understands the task (followed by an inablity to complete it) rooted in a fear of admitting ignorance before her superior? If so, you may want to take some time to emphasize the importance of honesty and communication along the chain of command.
source.www.entrepreneur.com
When employees lie, it's a serious matter. But sometimes a little dishonesty can be helpful to your business.
Charalambos Vlachoutsicos, an adjunct professor at Athens University of Economics and Business in Greece and a former businessman, writes about his experience lying to a superior in a blog post for the Harvard Business Review.
“One company I worked in while studying for an MBA at Harvard was an electric appliance wholesaler managed by its founder autocratically and whimsically,” says Vlachoutsicos. The bottom-line driven business owner purportedly ruled with an iron fist, demanding “sales now, no matter how” from his employees, who worked on commission.
Vlachoutsicos admits the competitive--and frequently dishonest--atmosphere that this policy created did not sit well with him. “Fairness has always been the cornerstone of my value system. So although I was selling aggressively, I was always emphasizing ‘honest’ sales… sales not obtained under false pretenses.”
So after attempting to curtail dishonest practices like claiming the company’s vacuums were the fastest on the market (when they weren’t) to no avail, Vlachoutsicos decided to tell a lie.
He called a meeting with his boss, and explained that one of the company’s biggest customers had called to protest after being “lied to” about the features of one of their products. This wasn’t true. No one had complained. But Vlachoutsicos felt that the company’s false advertising policy would backfire--and that they would lose business because of it.
By framing the issue in this way, and by being genuinely invested in the company’s interests, Vlachoutsicos was able to reconcile his values with that of his employer. He learned a valuable lesson in the process: “The truth is that effective management invariably involves a certain amount of manipulation," he writes. "You do not always get your way by being direct. Instead, you have to find a way to bridge the gaps between your values and the culture you work in."
Whether his boss realized it or not, this sort of revelation was exactly what made Vlachoutsicos a good manager and team leader--and what makes good liars (let’s call them “negotiators”) the kind of people you want on your team. They are the people willing to make creative compromises in pursuit of mutual goals--something that both you and your customers can appreciate.
The less noble lies that your employees tell--like “Yes, I’m right on schedule with that end-of-the-year report” or “I’m late for this meeting because my dog got sick right as I was leaving the house”--can reveal valuable insight into your company’s culture, as well.
According to Shawn Achor, CEO of the positive psychology consulting firm Good Think Inc., lies may indicate that the problem is you, not your fibbing employees.
“If a manager is unable to hear about negative things, confusion, or setbacks, then that manager is going to get lied to often," Achor says in an interview with CareerBuilder. "Good managers want an accurate assessment of the present, even if it is not good. Bad bosses want the semblance of progress in the present, at the cost of future successes.”
The next time you're ready to throttle an excuse-giving employee, pause a moment to examine the bigger picture. Are unrealistic deadlines the reason that he is behind on a report? Are her assurances that she understands the task (followed by an inablity to complete it) rooted in a fear of admitting ignorance before her superior? If so, you may want to take some time to emphasize the importance of honesty and communication along the chain of command.
source.www.entrepreneur.com
Saturday 16 February 2013
12 Surprising Signs You Could Be an Entrepreneur
image credit: Shutterstock
Almost every article ever written about entrepreneurship
suggests that it's not for everyone. And yet the articles go on to list
attributes that many successful people possess as the traits commonly
associated with great entrepreneurs, such as a strong work ethic,
persistence, persuasiveness and discipline.
For 25 years, I have studied entrepreneurs and discovered that what
contributed to their incredible success was not what society typically
considers assets. People like John D. Rockefeller, Henry Ford and Oprah
Winfrey didn't achieve greatness by possessing the traits and following
the narrow path recommended by management gurus.
So, don't believe everything others say about you or how they
label you. Maybe your supposed liabilities are really your assets. Here
are 12 signs many people might consider a liability, but which can
actually be indications that you are meant to be an entrepreneur.
1. Hate the Status Quo – It doesn't make sense to
you that something has been done the time-honored way with no
explanation why. You are not someone who wants to just go through the
motions or sit by idly. Nor do you like following the pack.
2. Easily Bored - You find yourself easily bored,
and others start viewing you as a problem. But nothing is wrong with you
except that you are bored with activities that aren't up to your
abilities and aren't challenging. That's why you hated most of the
classes you ever attended. Think Bill Gates who dropped out of college
to become one of the richest men in the world.
3. Fired from Jobs – You're too creative for your
own good when it comes to working for others, and you may have some
history, as I do, of losing jobs. Being just a cog in wheel is very
difficult for you because you want to create something others can be
inspired by and contribute to.
4. Labeled a Rebel - You know that greatness resides
outside the lines of conformity and don't think that policies, laws and
regulations apply to you. You have been described as a rebel and rule
breaker and would defy gravity if you could.
5. Resist Authority - You have a lifelong record of
resisting authority from your parents, teachers and bosses. You don't go
along with the agreed upon norms of the group or community you work and
live in.
6. Ready to Improve Everything - You always see how
you could do things better. In addition, you are opinionated and freely
give your two-cents about your better way of doing things--even when
you're not asked.
7. Bad at Making Small Talk - You have difficulty
making the kind of small talk that so many people get comfort from. This
social pattern of relationship and rapport building seems like a waste
of time to you and makes you uncomfortable.
8. Bullied in Your Youth - You may have been heavily
criticized, picked on and even bullied as a child or teenager. This has
caused you to be driven to excel and to prove to the world that you are
indeed a force to be reckoned with.
9. Obsessive - You may have been labeled
obsessive/compulsive because when you get started on something you have
difficulty letting go. Don't let anyone convince you that this is a
disease or deficiency. All of the great entrepreneurs become completely
immersed in their vision. Howard Schultz stuck with Starbucks even when
his family tried to persuade him not to.
10. Scared to Go Solo - The entrepreneur in you is
scared of going out on your own—and also terrified of not doing so. This
fear is so common in our society because we've been conditioned to
think that entrepreneurship is much riskier than getting a "good job."
The reality is there is instability in both.
11. Unable to Unwind - You can't go to sleep at
night because you can't turn your thoughts off. An idea may even
manifest itself in your dreams. The next morning you find yourself still
consumed with that idea, distracting you from the job you're supposed
to be doing.
12. Don't Fit the Norm - You have always been a bit
uncomfortable in your own skin. Until you get used to the idea that you
are in fact different from most people, it could prove to be a
problem--or exactly the motivation you need to acknowledge the
entrepreneur screaming to get out.
SOURCE: www.entrepreneur.com
Friday 15 February 2013
5 Ways to Stop Stress Before It Starts
BY Jane Porter
image credit: Gnomestew
In 2008, at the tail end of a business trip that took her
from Kenya to India to Romania, Ellen Barnard realized she needed to
make a change or stress would get the best of her. She'd been co-owner
and executive producer of the Atlanta-based production company, Tomorrow
Pictures, for 12 years and hadn't made much time for exercise or social
commitments.
"I wasn't just tired. I wasn't just experiencing malaise. I was
really stressed out," Barnard says. "I had an ah-ha moment where I
thought, 'If I can get rid of some of this stress, I can be more
productive." So, she signed up for a knitting class. To this day, she
meets with the group every Monday night. "It was sort of life changing
for me," she says.
Relax. We aren't telling you to take up knitting. Calming as
its proponents say it is, knitting itself isn't what made the difference
in Barnard's stress levels. It was the simple act of spending time with
people in a social setting. Now, Barnard also meets weekly with a group
of women entrepreneurs and walks with her neighbors three times a week.
Rather than wait until you feel overwhelmed by stress, try taking these steps to prevent it:
Make time for friends. Barnard's story clearly shows
that creating time for friends and family can make you feel less
stressed--and perhaps even live longer. A 2010 Brigham Young University
study found that a lack of social relationships is comparable to smoking
in its negative health effects. But in the presence of other people,
the brain produces oxytocin, a hormone that can help lower blood
pressure, says Kathleen Hall, founder and CEO of The Stress Institute,
an Atlanta-based organization that trains companies in stress
resilience.
Social relationships can even make the challenges you run up against seem more manageable. A 2012 study in the Journal of Experimental Social Psychology
found that people who were alone estimated the steepness of a hill as
sharper than people who were with friends. "Social connection will
actually change your perceptions of the world around you," says Heidi
Hanna, author of The Sharp Solution: A Brain-Based Approach for Optimal Performance
(Wiley, 2013) and a fellow at the American Institute of Stress, a Fort
Worth, Texas-based clearinghouse of stress-related information. "It's
such a core survival need to be part of a tribe or a core community."
Get your nature fix. Being in a natural setting also
may help prevent stress. That's why eco-therapy, based on the premise
that connecting with sounds and images in nature triggers a calming part
of the brain, has been gaining popularity, Hall says. A 2007 study at
the University of Essex in England found that people who walked outside
in a natural setting experienced more relaxing feelings than those who
walked indoors. But if you can't escape the office for a stroll in the
park, Hall recommends downloading a nature app to your mobile phone and
spending a minimum of two minutes each day listening to anything from
the sound of water to birds to rustling trees. If nature sounds aren't
your thing, consider listening to calming music, looking at images of
natural settings or lighting scented candles, Hanna says. "If you can't
get to nature, bring nature to you."
Feed your brain. Your mother was right when she told
you to eat your breakfast. "The first thing the brain needs in the
morning is amino acids," Hall says. Going too long without eating
triggers a stress response that involves foggy thinking, slower
digestion and other negative effects, Hanna says. What to eat to avoid
this? A good start would be foods loaded with vitamin B6, which helps
produce more of the calming hormone serotonin. These include tuna,
turkey and bananas. Hall also recommends blueberries, which contain
antioxidants and vitamin C. While coffee is fine in moderation, don't
overdo it and send your blood pressure rising.
Take a few minutes to reset. Preventing stress
doesn't have to mean reconfiguring your daily schedule. Hanna recommends
taking as little as three minutes between tasks to give your mind a
break. "Those short little breaks give the system a chance to reset and
decrease stress hormones in the brain," she says. When you're stressed,
your body produces too much cortisol, interfering with your mental focus
and productivity. It's also important to take a few minutes for a
mental break before eating, which helps decrease the stress hormones
that hinder digestion. This could be as simple as taking a few deep
breaths or visiting with a friend in the office.
Move more. Exercise is critical in preventing
stress. If you can't get to the gym for a full workout, take a break to
do two minutes of stretches or to walk a few laps around your office
building. This will produce endorphins, which help you manage stress,
Hall says. Taking that break before meals is important. It not only
helps your body process food, but it also can prevent you from gaining
stress-related weight around your belly.
SOURCE: www.entrepreneur.com
Thursday 14 February 2013
Glimpse the Future: Inspirational Inventors in the Spotlight
Robert Langer, a MIT biomedical engineer, is one of the inventors who will be honored at the White House today. image credit: Kannair
What are the top inventors in the U.S. up to?
President Obama
is recognizing the contributions of a handful of inventors at the White
House today. What follows is a list of a few of the standout
innovations and the inspiring people behind them.
Bioengineered renewable fuels. Frances
Arnold, a California Institute of Technology professor of chemical
engineering, bioengineering and biochemistry at California Institute of
Technology, conducts research on protein engineering and protein
recombination. Her chemical engineering research has implications for
environmentally friendly technology, allowing for the production of
fuels and chemicals from renewable resources with lower carbon-dioxide
emissions.
Moon-based observatory. George Carruthers of the
Naval Research Laboratory in Washington, D.C., is best known for
developing the first moon-based space observatory, an ultraviolet camera
sent to the moon with the Apollo 16 mission in 1972. He started
building telescopes and model rockets from an early age and has become
known for his community outreach to inspire African-American youth to be
excited about technology.
Artificial skin. Robert Langer, a Massachusetts
Institute of Technology biomedical engineer, is most famous for his work
on new and different ways to administer drugs to patients. He has 810
issued and pending patents worldwide for his work in pharmaceutical,
chemical, biotechnology and medical device technology. Langer’s research
has led to the development of new tissues like artificial skin for
burn victims.
Portable oxygen. Norman McCombs is best known for
inventing the portable medical oxygen concentrator, an electrically
driven appliance that delivers oxygen on demand. He had been Senior Vice
President of AirSep Corp. in Buffalo, N.Y., which was acquired by Chart
Industries Inc. Patients with chronic lung diseases depend on portable
sources of oxygen and the 4.5 pound, battery-operated oxygen device has
been approved by the Federal Aviation Administration allowing those
dependent on oxygen to fly on planes where they once weren’t.
LASIK eye surgery. Gholam Peyman of Arizona Retinal
Specialists is the retinal surgeon who invented LASIK eye surgery, which
corrects the vision of nearsighted patients. Peyman holds more than
100 patents for a variety of medical devices and surgical techniques.
Energy efficiency. Art Rosenfeld, is a guest senior
scientist at the Lawrence Berkeley National Laboratory, and a renowned
energy scientist known as an ambassador for promoting energy efficiency
innovation. He had been part of the research group that won a Nobel
Prize in the 1960s for discovering subatomic particles. In the wake of
the 1974 OPEC oil embargo, Rosenfeld switched his focus to energy
conservation. He has served as a senior advisor to the Department of
Energy’s Assistant Secretary for Energy Efficiency and Renewable Energy,
on President Clinton’s National Science and Technology Council and
twice on the California Energy Commission.
Rheumatoid arthritis treatment: Jan Vilcek is a
professor of microbiology at New York University’s Langone Medical
Center and one of the inventors of the rheumatoid arthritis drug
Remicade. More than 2 million patients have been treated with Remicade.
What is the most inspiring invention you have heard about lately? Leave a comment below and let us know.
SOURCE: www.entrepreneur.com
Wednesday 13 February 2013
5 Tips for Training New Salespeople
If you want a strong sales team, you need to give your new hires some TLC
Getty
When you hire a new sales rep, the last thing you want is to end up
having to fire the person after a few weeks or months. That hurts the
whole company. Not only have you invested time and money in this person,
but customers and other employees tend to get nervous when they see a
new hire walking out the door. Yet many companies throw salespeople into
a new job without enough training or encouragement.
Here are a few tips that will give your newly hired sales reps a better shot at success:
1. Set up a peer-mentoring program.
The first 90 days of a sales rep’s tenure is the highest-risk period. In these first few months, new reps will struggle with many questions from customers. Some will become discouraged. One cost-free way to help them through this phase is to assign an experienced salesperson on your team to mentor one or more new hires. Ask the veteran rep to keep an open dialogue running each day, so that the new hires have someone to come to with questions or concerns.
The first 90 days of a sales rep’s tenure is the highest-risk period. In these first few months, new reps will struggle with many questions from customers. Some will become discouraged. One cost-free way to help them through this phase is to assign an experienced salesperson on your team to mentor one or more new hires. Ask the veteran rep to keep an open dialogue running each day, so that the new hires have someone to come to with questions or concerns.
2. Start with easy sells.
For the first few months, focus new hires on products that are quick and easy to sell, not on the more complicated ones. Nothing builds confidence more than making a sale, and these early, quick sales will help new reps establish relationships with customers. If you don’t have easy-sell products in your line, consider adding some, even if it's just for this purpose. You’ll find that it greatly benefits your business.
For the first few months, focus new hires on products that are quick and easy to sell, not on the more complicated ones. Nothing builds confidence more than making a sale, and these early, quick sales will help new reps establish relationships with customers. If you don’t have easy-sell products in your line, consider adding some, even if it's just for this purpose. You’ll find that it greatly benefits your business.
3. Don't forget the nitty gritty.
Learning the ropes of a company's often-complex structure can be tough for new sales hires. And when a rep is confused about how the organization works, it’s hard for him or her to efficiently solve customer problems. For instance, at one company I worked for, customer shipping information might come from one of three different departments depending on the type of product being ordered, and new reps had trouble figuring out which department to call when customers asked for delivery dates. To solve this problem, assign someone on your team to instruct all new reps on the company’s structure and procedures.
Learning the ropes of a company's often-complex structure can be tough for new sales hires. And when a rep is confused about how the organization works, it’s hard for him or her to efficiently solve customer problems. For instance, at one company I worked for, customer shipping information might come from one of three different departments depending on the type of product being ordered, and new reps had trouble figuring out which department to call when customers asked for delivery dates. To solve this problem, assign someone on your team to instruct all new reps on the company’s structure and procedures.
4. Publish success stories.
New salespeople are always looking for tips on improving their close rates. You can help by emailing everyone a few sales tips and success stories from seasoned reps each week. These mini-newsletters will not only show the inexperienced hires how to get better results, but the emails will also bolster their confidence. "If she can do it," they’ll say, "so can I!"
New salespeople are always looking for tips on improving their close rates. You can help by emailing everyone a few sales tips and success stories from seasoned reps each week. These mini-newsletters will not only show the inexperienced hires how to get better results, but the emails will also bolster their confidence. "If she can do it," they’ll say, "so can I!"
5. Do a weekly check-in.
There’s nothing more powerful for new reps than knowing that you—the leader—care about them and want to see them succeed. A weekly five-minute phone call from you can work wonders in terms of a new hire’s morale and effort. Simply touch base: Ask how he or she is doing or whether there’s anything you can do to help.
There’s nothing more powerful for new reps than knowing that you—the leader—care about them and want to see them succeed. A weekly five-minute phone call from you can work wonders in terms of a new hire’s morale and effort. Simply touch base: Ask how he or she is doing or whether there’s anything you can do to help.
Using these five tips will raise your sales reps’ chances of success,
boost your overall retention rate, and increase sales. When you show
that you care about each employee's success, you quickly outpace leaders
who simply make a hire and move on.
SOURCE: www.inc.com
Tuesday 12 February 2013
9 Ways to Forge Better Partnerships
BY: Geoffrey James
Business success depends on your ability to keep your partnerships healthy and happy.
Business success usually demands partnering with other people and
other firms to get big things done. Some partnerships are formal, like
outsourced supply chains, while others are less formal, as when
salespeople from different firms partner to win a complex opportunity.
It's thus in your interest to know exactly how to ensure
that your partnerships, both formal and informal, remain healthy and
happy, as well as highly likely to result in mutual success.
Here's a nine step process to achieve this, adapted from a conversation with Ed Rigsbee, author of The Art of Partnering:
1. Prepare to Relinquish Some Control
It's a natural tendency for entrepreneurs to seek to control of their
destiny. However, partnering always involves leaving yourself
vulnerable to the failing and failures of your partner.
At the very least, a partnership requires that you share
knowledge--like your own limitation and the weaknesses of your
firm--that you might not feel comfortable revealing to another person or
another company.
2. Understand Your Strengths and Weaknesses
Before you can considering a partnership, you must first understand
what you and your firm bring to the table and, by extension, where you
might need some outside help from a partner.
The easiest way to do this is to create a SWOT (strengths,
weaknesses, opportunities and threats) diagram. If you're truly honest,
you'll be able to identify areas where you might be able to help a
partner as well as areas where you could use some help yourself.
3. Select the Right Partner
Seek out individuals or firms that have strengths where you have
weaknesses and vice versa. For example, if you have great products but
little sales experience, you might look for a firm that has mediocre
products but a history of sales success.
It's also important to assess the other party's willingness (and
psychological readiness) to partner. Just because another firm has a
capability you need, that's no guarantee that they're ready to share it.
4. Build a Partnership Consensus
Once you've broached the idea of a partnership with the other party,
hash out a working agreement of who is going to do what and when. Build a
plan of action to address whatever opportunity you're intending to
pursue together.
If it's a formal partnership, you'll need a contract, of course.
However, if the partnership is informal, you should still create a
written outline describing detailed explanations of activities,
expectations, and responsibilities of each partner.
5. Adopt a Strict Code of Ethics
Ethics between partners are what makes a partnership possible. The
"golden rule" here is to "be the kind of partner with whom you'd like to
partner." It's not enough to BE honest; you must also avoid the
appearance of dishonesty as well.
By the way, ethics are even more important if the business
you're conducting has a lot of risk involved. As Ben Franklin once said:
"We must all hang together or assuredly we shall all hang separately.
6. Go Beyond Your Commitments
Successful partnerships--especially those formalized by
contracts--require trust between the partners. The best way to increase
the level of trust in a partnership is to always deliver a bit more than you said you will deliver.
To use an analogy from outside of business, the best marriages are
characterized not just by both parties meeting their minimum commitments
(e.g. no adultery) but actively doing extra, on a daily basis, to try
to make the other person happier.
7. Be Patient With the Partnership
If the partnership develops problems, don't give in to anger or
frustration. Meet your partner more than halfway. If there's money on
the table, dispose of it fairly or offer to buy your partner out.
Above all, avoid taking any disagreement with your partner to court.
The end result of a court case will be pennies on the dollar for you,
and even that is only if you're lucky. Chance are the only "winners"
will be the lawyers.
8. Monitor and Measure
Ineffective communication is the primary reason that partnerships
fail. As with any other business situation, it is measurement that
provides the basis for meaningful and effective communication.
Strive to have enough ongoing communication so that both parties can
monitor the relationship both at the "macro" and "micro" level. Then
when challenges pop up, you can both work together to quickly address
them.
9. Celebrate Frequently
Getting a partnership from initial handshake to a long-term,
mutually-profitable relationship requires plenty of "emotional fuel." As
the partnership progresses, both parties will need to invest time and
energy to maintain and strengthen the relationship.
The best and easiest way to do this is to celebrate--really
celebrate--every time the partnership achieves something significant. If
you really want the partnership to thrive, make that the celebration
includes some extra compensation for everyone involved.
Like this post? If so, sign up for the free Sales Source newsletter.
SOURCE: www.inc.com
A Business Idea for the Big Game -- And Beyond
Eric Shapiro
What’s worse than missing the festivities of Super Bowl Sunday? Not missing the festivities of Super Bowl Sunday.
The day after -- Monday morning, in particular -- can often be the pits for football fans and revelers who perhaps had one too many during the big game.
Fortunately, for these hangover-plagued adults there’s a cure. Enter: Party Armor, a two-ounce shot aimed to replenish vitamins the body loses after a night of drinking. Like so many business ideas, the concept for Party Armor arose out of personal necessity.
As is true for many college students, Curtis Thorsby regularly woke up with hangovers. But rather than dwell on his self-inflicted pain, the 22-year-old sophomore at Central Michigan University decided to do something about it. He wanted to concoct the ultimate hangover cure.
“While enjoying the typical ‘social habits’ of most college
students, my brother and I would often drink half as much as our
friends, and wake up feeling twice as bad the next morning,” says
Curtis. “We felt that was unfair -- being punished for enjoying life --
and made it our goal to invent the worlds greatest hangover
preventative.”
Curtis tapped his older brother Cason -- a business school student, also at CMU -- and set out to formulate a recipe. Cason, now 26, had earned around $30,000 from the sale of one of his companies, Elite Tent Rental, a rental equipment company in 2009, which he put toward the new project.
Related: Extrabux: From Campus Startup to Social-Shopping Goldmine
Though the brothers started out with an assortment of pills and powders they eventually consulted with nutritionists and medical professionals and came up with a liquid formula. And then, by 2010, they were in business.
Of course coming up with an idea for a recovery drink is a lot easier than selling it.
Not only is the U.S. beverage market thick with competition, it’s also
hard to register on consumers’ busy minds when your marketing budget is
nil. Plus, since the downfall of Four Loco and other high-profile
investigations into energy drinks, consumers are newly leery about what
they take in.
“The consumer often assumes that our product is ‘too good to be true’ or it’s ‘snake oil,’” Cason says.
But that nut, once cracked, is huge. So-called hangover remedies like Party Armor fall under the umbrella of “functional beverages,” which according to research firm Datamonitor is a nearly $50 billion industry worldwide.
Related: Making Freedom Part of the Business Model: How a Young Trep Helped Fuel the Arab Spring
The global functional drinks market -- which includes energy and sports drinks, as well as functional beverages that use natural ingredients -- grew by 3 percent in 2010 to reach a value of $48.2 billion, according to Datamonitor’s “Functional Drinks: Global Industry Guide for 2011,” which is the most recent version of the report. In 2015, that market is expected to jolt another 29 percent from 2010 to more than $62.1 billion.
With wide eyes, the Thorsbys have persisted. “It’s all about educating our customers, letting them know how and why Party Armor is an effective way of treating hangovers.”
In explaining how Party Armor works, the young entrepreneurs focus on the elements that appeal to their target demographic of college students and young professionals. For instance, touting the fact that Party Armor is composed of all-natural ingredients has proven an effective way of assuaging health-conscious customers, understandably wary of putting chemicals into their body.
Yet they also know how to have fun -- another element that tends to appeal to their much coveted market. They’ll often promote their product on college campuses by way of their “Gnar-V,” an RV equipped with a killer sound system, partying paraphernalia and of course plenty of Party Armor. Upon arriving at a party or club, the Thorsby brothers invite attendees aboard to party and try out free samples of their product.
Related: The New Cool Kids: Teenage-App Developers
With that combination of grassroots marketing and social networking, the Thorsby brothers have already seen some significant success. Party Armor is currently offered at major retailers including Walgreens, Meijer, and 7/11 and closed out the 2012 with more than $150,000 in revenue. The company anticipates that a new joint venture deal in Europe, as well as recently landing distribution in Australia and New Zealand will help them surpass $500,000 in sales in 2013.
Still, the road ahead is long, Cason concedes. “We look at it like this: Deodorant first hit the market in the 1960s, and really never became popular until the 1970s. People didn’t think it really worked,” he says. “Now, they wouldn’t dare go out without deodorant, and we feel the same thing will be true for our product.”
Read more stories about: Business ideas, Finding customers, Marketing strategies, Starting a business
What’s worse than missing the festivities of Super Bowl Sunday? Not missing the festivities of Super Bowl Sunday.
The day after -- Monday morning, in particular -- can often be the pits for football fans and revelers who perhaps had one too many during the big game.
Fortunately, for these hangover-plagued adults there’s a cure. Enter: Party Armor, a two-ounce shot aimed to replenish vitamins the body loses after a night of drinking. Like so many business ideas, the concept for Party Armor arose out of personal necessity.
As is true for many college students, Curtis Thorsby regularly woke up with hangovers. But rather than dwell on his self-inflicted pain, the 22-year-old sophomore at Central Michigan University decided to do something about it. He wanted to concoct the ultimate hangover cure.
Curtis tapped his older brother Cason -- a business school student, also at CMU -- and set out to formulate a recipe. Cason, now 26, had earned around $30,000 from the sale of one of his companies, Elite Tent Rental, a rental equipment company in 2009, which he put toward the new project.
Related: Extrabux: From Campus Startup to Social-Shopping Goldmine
Though the brothers started out with an assortment of pills and powders they eventually consulted with nutritionists and medical professionals and came up with a liquid formula. And then, by 2010, they were in business.
Party
Armor founders often drive their “Gnar-V” around to drum up attention
for the hangover cure. Here, the van is parked outside of a stadium
where the Detroit Tigers played the 2012 World Series.
“The consumer often assumes that our product is ‘too good to be true’ or it’s ‘snake oil,’” Cason says.
But that nut, once cracked, is huge. So-called hangover remedies like Party Armor fall under the umbrella of “functional beverages,” which according to research firm Datamonitor is a nearly $50 billion industry worldwide.
Related: Making Freedom Part of the Business Model: How a Young Trep Helped Fuel the Arab Spring
The global functional drinks market -- which includes energy and sports drinks, as well as functional beverages that use natural ingredients -- grew by 3 percent in 2010 to reach a value of $48.2 billion, according to Datamonitor’s “Functional Drinks: Global Industry Guide for 2011,” which is the most recent version of the report. In 2015, that market is expected to jolt another 29 percent from 2010 to more than $62.1 billion.
With wide eyes, the Thorsbys have persisted. “It’s all about educating our customers, letting them know how and why Party Armor is an effective way of treating hangovers.”
In explaining how Party Armor works, the young entrepreneurs focus on the elements that appeal to their target demographic of college students and young professionals. For instance, touting the fact that Party Armor is composed of all-natural ingredients has proven an effective way of assuaging health-conscious customers, understandably wary of putting chemicals into their body.
Yet they also know how to have fun -- another element that tends to appeal to their much coveted market. They’ll often promote their product on college campuses by way of their “Gnar-V,” an RV equipped with a killer sound system, partying paraphernalia and of course plenty of Party Armor. Upon arriving at a party or club, the Thorsby brothers invite attendees aboard to party and try out free samples of their product.
Related: The New Cool Kids: Teenage-App Developers
With that combination of grassroots marketing and social networking, the Thorsby brothers have already seen some significant success. Party Armor is currently offered at major retailers including Walgreens, Meijer, and 7/11 and closed out the 2012 with more than $150,000 in revenue. The company anticipates that a new joint venture deal in Europe, as well as recently landing distribution in Australia and New Zealand will help them surpass $500,000 in sales in 2013.
Still, the road ahead is long, Cason concedes. “We look at it like this: Deodorant first hit the market in the 1960s, and really never became popular until the 1970s. People didn’t think it really worked,” he says. “Now, they wouldn’t dare go out without deodorant, and we feel the same thing will be true for our product.”
Read more stories about: Business ideas, Finding customers, Marketing strategies, Starting a business
Monday 11 February 2013
Michael Useem's Rule for Success: Let Others Lead
A Wharton professor discusses the key role of resilience in leadership.
Hulton Archive/Getty Images
A German officer explains details of a military map captured with him, to members of the Allied Expeditionary Force.
Michael Useem is a professor at the Wharton School and author, most recently, of The Leader's Checklist. He spoke with reporter Adam Bluestein.
What is the single most important quality a leader needs to possess?With
unpredictable markets, shorter time cycles, and an increasingly complex
business environment, I would say resilience, the ability to come back
from crisis.
How can leaders make their organizations more resilient?Leadership
is a team sport. You need to build leadership through the ranks, by
empowering people to independently make good decisions. You can't do
that if you don't make clear what your vision is.
Military history offers some good examples: During the Normandy
invasion, the German local commanding officers were given little
discretion by German central command. As a result, they responded
inflexibly to what the circumstance required, based on the false premise
that the Big General can make the big decisions for the frontline. In
business, you can look to the famous Tylenol recall by Johnson &
Johnson.
It wasn't just the CEO but people all up and down the ranks who
independently made good decisions that led the company to take
everything off the shelves nationally.
SOURCE: www.inc.com
Sunday 10 February 2013
12 Great Motivational Quotes for 2013
BY: Geoffrey James
This set of inspirational thoughts for the new year will galvanize you into action.
At the start of every year, I create a list of quotes to guide and
inspire me for the next 12 months. Here are the quotes I've selected for
2013:
- "Cherish your visions and your dreams as they are the children of your soul, the blueprints of your ultimate achievements."
Napoleon Hill - "The key to success is to focus our conscious mind on things we desire not things we fear."
Brian Tracy - "Success is getting what you want. Happiness is wanting what you get."
Dale Carnegie - "Obstacles are necessary for success because in selling, as in all
careers of importance, victory comes only after many struggles and
countless defeats."
Og Mandino - "A real decision is measured by the fact that you've taken a new action. If there's no action, you haven't truly decided."
Tony Robbins - "If you can't control your anger, you are as helpless as a city without walls waiting to be attacked."
The Book of Proverbs - A mediocre person tells. A good person explains. A superior person
demonstrates. A great person inspires others to see for themselves."
Harvey Mackay - "Freedom, privileges, options, must constantly be exercised, even at the risk of inconvenience."
Jack Vance - "Take care of your body. It's the only place you have to live."
Jim Rohn - "You can have everything in life you want, if you will just help other people get what they want."
Zig Ziglar - "The number of times I succeed is in direct proportion to the number of times I can fail and keep on trying."
Tom Hopkins - "You have everything you need to build something far bigger than yourself."
Seth Godin
Readers: I want to begin this year with a huge burst of
motivation. Can you help me out? What quotes or thoughts inspire YOU to
be the best that you can be? (Leave a comment!)
SOURCE: www.inc.com
How to Create a Positive Attitude
Geoffrey James
A positive attitude--optimism, expectancy, and enthusiasm--makes
everything in business easier. A positive attitude boosts you up when
you're down and supercharges you when you're already "on a roll."
Here's how to cultivate a positive attitude, regardless of what's happening at work, based upon a conversation with Jeff Keller, author of the bestseller Attitude Is Everything:
Take, for example, receiving the unexpected gift of an old automobile. One person might think: "It's a piece of junk!" a second might think: "It's cheap transportation," and a third might think: "It's a real classic!"
In each case, the person is deciding how to interpret the event and therefore controlling how he or she feels about it (i.e. attitude).
If you tell a complainer about a success that you've experienced, they'll congratulate them, but their words ring hollow. You can sense they'd just as soon you told them about what's making you miserable. What a drag (figuratively and literally)!
A positive attitude is never automatic. You have to work at it! Here's how to become a master of the mind.
Martin Barraud/Getty
Here's how to cultivate a positive attitude, regardless of what's happening at work, based upon a conversation with Jeff Keller, author of the bestseller Attitude Is Everything:
1. Remember that YOU control your attitude.
Attitude does not emerge from what happens to you, but instead from how you decide to interpret what happens to you.Take, for example, receiving the unexpected gift of an old automobile. One person might think: "It's a piece of junk!" a second might think: "It's cheap transportation," and a third might think: "It's a real classic!"
In each case, the person is deciding how to interpret the event and therefore controlling how he or she feels about it (i.e. attitude).
2. Adopt beliefs that frame events in a positive way.
Your beliefs and rules about life and work determine how you interpret events and therefore your attitude. Decide to adopt "strong" beliefs that create a good attitude rather than beliefs that create a bad attitude. To use sales as an example:- Situation: The first sales call of the day goes poorly.
- Weak: A lousy first call means that I'm off my game and today will suck.
- Strong: Every sales call is different, so the next will probably be better.
- Situation: A customer reduces the amount of an order at the last minute!
- Weak: Customers who change orders can't be trusted.
- Strong: Customers who change orders are more likely to be satisfied!
- Situation: A big sales win comes seemingly "out of nowhere."
- Weak: Even a blind pig finds an acorn once in a while.
- Strong: You never know when something wonderful will happen!
3. Create a "library" of positive thoughts.
Spend at least 15 minutes every morning to read, view, or listen to something inspirational or motivational. If you do this regularly, you'll have those thoughts and feelings ready at hand (or rather, ready to mind) when events don't go exactly the way you'd prefer.4. Avoid angry or negative media.
Unfortunately, the media is full of hateful people who make money by goading listeners to be paranoid, unhappy, and frightened. The resulting flood of negativity doesn't just destroy your ability to maintain a positive attitude; it actively inserts you into a state of misery, pique, and umbrage. Rather than suck up the spew, limit your "informational" media consumption to business and industry news.5. Ignore whiners and complainers.
Whiners and complainers see the world through crap-colored glasses. They'd rather talk about what's irreparably wrong, rather than make things better. More importantly, complainers can't bear to see somebody else happy and satisfied.If you tell a complainer about a success that you've experienced, they'll congratulate them, but their words ring hollow. You can sense they'd just as soon you told them about what's making you miserable. What a drag (figuratively and literally)!
6. Use a more positive vocabulary.
I've written about this before, but the point is worth making again. The words that come out of your mouth aren't just a reflection of what's in your brain--they're programming your brain how to think. Therefore, if you want to have a positive attitude, your vocabulary must be consistently positive. Therefore:- Stop using negative phrases such as "I can't," "It's impossible," or "This won't work." These statements program you for negative results.
- Whenever anyone asks "How are you?" rather than "Hangin' in there," or "Okay, I guess..." respond with "Terrific!" or "Never felt better!" And mean it.
- When you're feeling angry or upset, substitute neutral words for emotionally loaded ones. Rather than saying "I'm enraged!" say "I'm a bit annoyed..."
Saturday 9 February 2013
10 Ways to Step Up Your Leadership Today
BY: Dave Balter
No matter who you are, or the type of company you oversee, there are some universal ways you can be better at it.
Strong leadership is a lifelong pursuit that requires continuous
evaluation and improvement. Every leader has his own style, and every
company needs a personalized approach.
That said, there are 10 things any entrepreneur in any organization can do to deliver results:
1. Don't try to get stuff done.
That's not your job. As CEO, your job is to get others to execute
for you. A leader is the only one who can drive the big strategy, so
being caught in the weeds will only undermine the ability for everyone
else to win.
2. Forget about democracy.
You want to be a supportive, open-minded autocrat. If you make soft
suggestions and ask for input, you create a lack of confidence among
your subordinates. Be assertive; lead by unwavering decisiveness.
3. Never say 'start small.'
Seek out the big ideas and drive your team to achieve them. If you start small, you succeed small.
4. Make time your enemy.
The best CEOs move faster, get to scale sooner, and make things happen now. Impatience is a critical tool to motivate results.
5. Tell exciting stories.
Having a vision and strong direction is only as good as how well you
convince others to believe in what you're saying. Not much is as
important as being able to relay--in person, or on paper--through
stories that inspire others.
6. Deliver finished materials.
Any document that feels raw and rushed was not thought through
carefully, and won't be taken seriously. Pay close attention to typos,
punctuation, page breaks, headers, and footers. Perfect formatting and
proofreading are essential elements to sell your ideas.
7. Prepare extensively for every meeting.
The more structure you can create as CEO, the more your team will
know how to deliver results. You want to write crafted agendas, and
make employees accountable. Provide clear roles and clarify
expectations in advance, and oversee meetings by deliberately pacing
each section.
8. Remove staffers who don't crush it. Immediately.
The only route to success is getting great people to achieve
greatness. The clichés are true: few get better at hiring; many get
better at firing. Being one man down is better than having an
underperformer.
9. Don't turn "off"--ever.
If you're going to inspire a team, you must avoid blackout periods,
and communicate more often and more clearly than anyone else. Silence
results in complacency, so always respond. Weekends and nights are just
as important.
10. Behave like your company is publicly-traded.
What would you do if you knew that every decision you made would be
visible to shareholders, affect share price, and put your job on the
line? Operate from this perspective and your biggest ideas will rise to
the forefront.
SOURCE: www.inc.com
How to Really Praise Employees
Margaret Heffernan
All employees want feedback and good bosses know that giving it appropriately is one of the single most effective ways to improve performance.
But as I consult to different businesses, I'm often struck by how very bland and routine much of the feedback is. I'm talking about: "Good job!" "Nice work!" "You're the greatest!"
These comments are positive, but they aren't feedback. Why? Because they don't tell employees what they did right--only that they did do something that met with approval. It gives them no clue as to what particular talent or habit you're trying to reinforce.
The work of psychologist Carol Dweck is germane here. What she's found is that, when children are praised in abstract--"You're so smart" or "You're so creative"--rather than concretely about how they improved their performance--"You put in an enormous amount of work, and it paid off"--the feedback is diminished. How come? Because the child takes from the teacher or parent the idea that she is innately smart or creative, and that she doesn't need to work at it--so she doesn't.
On the other hand, very specific feedback--especially about something an individual can control--can work wonders. "You are so reliable," "I love the fact that you are always on time," or "Your research is so meticulous" tells the recipient exactly what proved so valuable. And it inspires more of the same. Nobody praised for punctuality decides they don't need to be on time any more; if anything, it makes them more determined than ever not to let you down.
I can't help but be struck by the volumes of mindless praise I hear regularly in the workplace. I know it's well intended but it isn't effective.
Put a little extra throught in. Identify the action that delivered the result--and you make everyone better.
12 Great Motivational Quotes for 2013
6 Habits of Remarkably Likable People
5 Things That Really Smart People Do
9 Daily Habits That Will Make You Happier
8 Things Remarkably Successful People Do
Don't just say, 'Nice work!' Psychologist Carole Dweck emphasizes the need to compliment the specific effort employees put in.
Martin Barraud/Getty
But as I consult to different businesses, I'm often struck by how very bland and routine much of the feedback is. I'm talking about: "Good job!" "Nice work!" "You're the greatest!"
These comments are positive, but they aren't feedback. Why? Because they don't tell employees what they did right--only that they did do something that met with approval. It gives them no clue as to what particular talent or habit you're trying to reinforce.
The work of psychologist Carol Dweck is germane here. What she's found is that, when children are praised in abstract--"You're so smart" or "You're so creative"--rather than concretely about how they improved their performance--"You put in an enormous amount of work, and it paid off"--the feedback is diminished. How come? Because the child takes from the teacher or parent the idea that she is innately smart or creative, and that she doesn't need to work at it--so she doesn't.
On the other hand, very specific feedback--especially about something an individual can control--can work wonders. "You are so reliable," "I love the fact that you are always on time," or "Your research is so meticulous" tells the recipient exactly what proved so valuable. And it inspires more of the same. Nobody praised for punctuality decides they don't need to be on time any more; if anything, it makes them more determined than ever not to let you down.
I can't help but be struck by the volumes of mindless praise I hear regularly in the workplace. I know it's well intended but it isn't effective.
Put a little extra throught in. Identify the action that delivered the result--and you make everyone better.
Read more
-
15 Tips for Talking to Women And Attracting Them Like Crazy (LOL Fanatic!)
-
Can You Really Measure the Impact of Coaching? (Executive Coaching University)
-
Maybe Management Isn’t Your Style (The New York Times)
-
If You're Using Gmail, you Should try This! (Tanya Smith Online)source. www. inc.com
Friday 8 February 2013
Now That I'm the Boss, Do I Have To Turn Evil?
BY: Suzanne Lucas
5 tips from an HR expert on how to keep from turning into the boss you hated.
Getty
Dear Evil HR Lady,
As an employee, I noticed that bosses tend to be highly irritable, unforgiving, and quite volatile at times. I’ve had my fair share of being blown up at for missing a deadline by 5 minutes. But now that I'm running my own company and have my own employees, I understand how someone missing a deadline can start to affect the productivity, effectiveness, and even reputation of the entire company.
However, I have yet to berate someone in public or blast them in an email for making me look bad. Is that what I have to look forward to: turning into an evil, hate-mail sending grouch? How can I avoid this and still get the work done on time?
As an employee, I noticed that bosses tend to be highly irritable, unforgiving, and quite volatile at times. I’ve had my fair share of being blown up at for missing a deadline by 5 minutes. But now that I'm running my own company and have my own employees, I understand how someone missing a deadline can start to affect the productivity, effectiveness, and even reputation of the entire company.
However, I have yet to berate someone in public or blast them in an email for making me look bad. Is that what I have to look forward to: turning into an evil, hate-mail sending grouch? How can I avoid this and still get the work done on time?
--Not a Grouch
Dear Not--
I hope you don't turn into an evil, hate-mail sending grouch. That's
my job and, quite frankly, I don't cherish competition. There are
simple (note, I did not say easy) ways to avoid the urge to send these
types of emails. Here are 5 tips.
Help everyone see the big picture. Sometimes tasks may seem silly, or not worthwhile. Sometimes fascinating tasks are less urgent than boring tasks, and the boring gets shunted to the side, causing the boss to freak out. If your employees know what is going on and how things fit together, it's easier for them to see the reason to focus on the urgent first.
Remember, it doesn't have to be done the way you would do it. One of the totally awesome things about running your own company is that you can finally do it your way. And yes, you've earned that right and yes, you're the boss. But sometimes your way isn't the only way. If you feel tempted to scream because something wasn't done the “right” way, pause and ask yourself if it was done a “good” way. Sometimes, a different way turns out to be a great way. Remember, you hired people because you couldn't do it all yourself. So, let them use their skills.
Encourage open communication. If you get upset when someone tells you they are behind schedule and needs an extension, chances are they won't tell you next time. And not knowing in advance is far worse than knowing and being able to prepare. If you appear frustrated or angry anytime someone asks, “Why are we doing it this way?” they'll feel like their knowledge isn't valued. And people who aren't valued don't perform as well.
Hold regular one-on-one meetings with your direct reports. And by regular, I mean weekly, if at all possible. This is not doing work together (that will probably happen far more often). This is sitting down and saying, “How are your projects? What do you suggest we change? What challenges do you foresee?” This develops relationships of trust between you and your staff. If they trust you and like you, they are more likely to want to do what it takes to help your business succeed. These meetings do not have to be long, but they have to be frequent or they lose their effectiveness.
Remember, lives exist outside of the office. This company is your baby, and like all parents you're willing to stay up into the night, and suffer through the pain of potty training. Your employees see this as a job. And while they may be passionate about the work they are doing, they aren't devoted the way you are. If you expect the same level of love and devotion from them that you, yourself, have, you'll likely find yourself frustrated and angry when they have the audacity to have a life outside of work.
Congratulations on your new business and on recognizing that screaming fits and emails written in all caps tend to dishearten rather than encourage employees.
Help everyone see the big picture. Sometimes tasks may seem silly, or not worthwhile. Sometimes fascinating tasks are less urgent than boring tasks, and the boring gets shunted to the side, causing the boss to freak out. If your employees know what is going on and how things fit together, it's easier for them to see the reason to focus on the urgent first.
Remember, it doesn't have to be done the way you would do it. One of the totally awesome things about running your own company is that you can finally do it your way. And yes, you've earned that right and yes, you're the boss. But sometimes your way isn't the only way. If you feel tempted to scream because something wasn't done the “right” way, pause and ask yourself if it was done a “good” way. Sometimes, a different way turns out to be a great way. Remember, you hired people because you couldn't do it all yourself. So, let them use their skills.
Encourage open communication. If you get upset when someone tells you they are behind schedule and needs an extension, chances are they won't tell you next time. And not knowing in advance is far worse than knowing and being able to prepare. If you appear frustrated or angry anytime someone asks, “Why are we doing it this way?” they'll feel like their knowledge isn't valued. And people who aren't valued don't perform as well.
Hold regular one-on-one meetings with your direct reports. And by regular, I mean weekly, if at all possible. This is not doing work together (that will probably happen far more often). This is sitting down and saying, “How are your projects? What do you suggest we change? What challenges do you foresee?” This develops relationships of trust between you and your staff. If they trust you and like you, they are more likely to want to do what it takes to help your business succeed. These meetings do not have to be long, but they have to be frequent or they lose their effectiveness.
Remember, lives exist outside of the office. This company is your baby, and like all parents you're willing to stay up into the night, and suffer through the pain of potty training. Your employees see this as a job. And while they may be passionate about the work they are doing, they aren't devoted the way you are. If you expect the same level of love and devotion from them that you, yourself, have, you'll likely find yourself frustrated and angry when they have the audacity to have a life outside of work.
Congratulations on your new business and on recognizing that screaming fits and emails written in all caps tend to dishearten rather than encourage employees.
--Evil HR Lady
SOURCE: www.inc.om
Thursday 7 February 2013
Selling Your Business: Timing Is Everything
BY: Karl Stark and Bill Stewart
Shutterstoc
One of the most critical decisions an entrepreneur makes is determining the best time to bring in outside investors or sell the business entirely. Similar to investing in stocks or playing a game of poker, you need to have a strategy in place to know when to cash in your chips and maximize payout. Getting the timing right is key to getting the highest return for the business you've worked so hard to build.
Here are five points to keep in mind as you evaluate your options.
Selling a business is both an art and a science, and this is particularly true in terms of valuation. There are many reasons a founder may want to retain ownership, including the optimism that a better bidder could be around the corner. Given that business valuations may fluctuate, it's important to stay informed of current valuations to exit successfully. Sometimes the greatest risk of all is not letting go at the right time.
Please send us your thoughts at karlandbill@avondalestrategicpartners.com
Associate Alicia Raisinghani contributed to this article.
Knowing the right time to sell is key to getting the
best return for your business. Here are five things to consider about
your exit strategy.
ShutterstocOne of the most critical decisions an entrepreneur makes is determining the best time to bring in outside investors or sell the business entirely. Similar to investing in stocks or playing a game of poker, you need to have a strategy in place to know when to cash in your chips and maximize payout. Getting the timing right is key to getting the highest return for the business you've worked so hard to build.
Here are five points to keep in mind as you evaluate your options.
1. Know Which Factors Impact Valuation
A business is an attractive acquisition target when it is growing and has a track record of success. Regardless of what has been invested in the business, its valuation is always changing based on market conditions and its competitive positioning. Ultimately, a company's value is driven primarily by its relevance in the marketplace, operational strength, and ability to generate cash flow going forward. Specifically, factors that impact valuation include:- Profitability
- Cash flow
- Client / customer relationship quality
- Growth opportunities
- Potential synergies with strategic buyers
- Competitive market positioning / sustainable competitive advantages
- Balance of the management team and reliance on the owner
- Macroeconomic factors, including availability of affordable debt
2. Set Defined Goals
Experts view business growth as a stepwise function in which each incremental capital investment allows for growth potential with a maximum limit. Weigh whether you have optimized the business performance given the resources (time and people) in place. Set specific targets that you'd like to hit (revenue, financing, enterprise value, etc.) so that as the business grows, you have concrete objectives to serve as an indicator that it may be time for an exit or potential next round of investment.3. Know the Current Valuation
Communicate regularly with a trusted professional for perspective of the market transaction multiples, potential sale price, best practices for preparing financial statements for potential buyers, and the general market landscape of potential buyers. Advisers can connect you with their network of potential buyers and help you gauge the appetite of public markets for your business.4. Evaluate the Opportunity Cost
Many entrepreneurs feel inclined to retain their business given the potential for independently driving growth, the annual cash flow streams, and the sense of purpose from their greatest endeavor. However, if you're planning to sell at some point and current exit conditions are favorable, it may be wise to forego this perceived security. Connect with your wealth adviser to project the expected returns if proceeds from the sale were invested across different asset classes. Evaluate the opportunity cost of keeping your wealth tied into the business, as the returns can be greater--or the risk of holding your investments in a concentrated portfolio is diminished--if the capital is invested in alternative ways. Investments in fixed income and equity markets will likely free your time and enhance liquidity options in the face of market changes, mitigating idiosyncratic risk.5. Find Capable Buyers
Many buyers require that the seller stay vested in the business post-transaction in the form of minority stake, options, or some form of advisory service to ensure an effective transition. Accordingly, seek a buyer equipped with the skills and resources to execute on their business plan so the value of any remaining stake is preserved.Selling a business is both an art and a science, and this is particularly true in terms of valuation. There are many reasons a founder may want to retain ownership, including the optimism that a better bidder could be around the corner. Given that business valuations may fluctuate, it's important to stay informed of current valuations to exit successfully. Sometimes the greatest risk of all is not letting go at the right time.
Please send us your thoughts at karlandbill@avondalestrategicpartners.com
Associate Alicia Raisinghani contributed to this article.
Difference Between Brute Force & Strategic Growth
Karl Stark an
As your company grows it may be necessary to move away from your brute force approach to a more calculated plan.
Flickr photo courtesy of Hector Alejandro
In a recent column, we discussed how leadership styles must adapt to sustain growth as a company gets larger. The transition involves moving from brute-force leadership to visionary and operational leadership.
The Brute-Force Entrepreneur
Every small company needs a motivated and charismatic entrepreneur, or two, who can take personal responsibility for building the company. This individual grabs the organization by the neck and forces it to grow. They have a "win or die" mindset. They tend to bet the firm against the odds and push it as hard as they can to overcome those odds.Brute-force entrepreneurs are different than a typical small business owner, who wants to build a business to sustain a career or create financial stability for his or her family. Growth is necessary, but the small business owner would never bet the farm on a growth strategy. They may seek to build an organization that can grow enough for them to step away and sustain cash flow into retirement. They likely do not have the ambition or skills to create an ever-larger organization.
The Growth Company CEO
The leadership styles that are essential to both the brute-force entrepreneur and the small business owner are much different--and in some cases detrimental--to the skills needed to sustain growth in a larger organization. Big companies require a visionary who can get a trusted management team on the same page, working toward a common goal. They need a coach, rather than a star quarterback.The larger growing company also needs an operationally skilled CEO who takes the role we like to call The Integrator. Gino Wickman talked about the Integrator in his book, Traction. It's someone, either the CEO or COO, who integrates the various parts of the organization to ensure that the sum of the parts can deliver on the company's growth goals. In contrast to the brute-force entrepreneur, the operational CEO engineers an organization to create growth.
We asked Ross Shelleman, CEO of Target Data, about this concept. "I think people confuse the word entrepreneur with inventor," he said. "I don't fit in at an incubator like 1871 in Chicago. We run our company like a smaller version of a large company."
Our friend Jon Morris, CEO of Rise Interactive, put it this way, "I want to make sure everyone in my company is focused on a set of goals that ensure that they do their part to sustain the growth of the company."
Mindsets like these will lead to continued growth after the entrepreneurial stage and into the long term.
Share your thoughts on leadership roles for growing companies. We want to hear your questions and success stories. We can be reached at karlandbill@avondalestrategicpartners.com.
d Bill Stewart
SOURCE. www.inc.com
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