Small Business Success Tips

May 30, 2012

As I’ve remarked in previous posts, an increasing number of my friends and colleagues are leaving their employment to start their own businesses and we have quite a few discussions on the trials and tribulations of doing this in the current climate.

Whilst there is obviously no set prescription, suggestions can sometimes prompt a rethink or re-evaluation which can be worth it’s weight in gold.

In this context, the small business themes recently highlighted by Fast Company are (more details in the original post – below I’ve added a few of my own comments and slightly reordered the list):

  • Take A Risk – but just assess the market first – I’m constantly surprised at the number of people who do no market research at all. I agree it’s rare that the info you need is quickly or easily available but making smart guesses can help overcome this as well as provide new and valuable viewpoints.
  • Is Your Idea Good Enough? – quite a few people forget that they are prototype users too. It’s usually very easy to see if an approach has a good ‘user experience’, just imagine yourself as a non-partisan customer for your planned service. Whilst it doesn’t need to be perfect right from the start, it’s helpful to do a sanity check to make sure  there are no obvious annoyances (or worse, howlers).
  • And If It Isn’t, Can You Pivot It – in a way this is a frame of mind. If things aren’t working, just accept this quickly and move on. This should be thought of as a great learning experience rather than a confirmation of failure and consequent dented self-belief.
  • Ditch The Strategic Plan – no need to plan too much – often this is only procrastination anyway – but keep the strategic thinking aspect always in mind. People often get bogged down in details and miss wider insights.
  • Focus On What Matters – of course, it’s not always totally clear what are the most important factors! Hindsight is a wonderful thing. However it’s better to make a decision, go with it and then learn rather than try and do everything at the same time.
  • Tap The Wisdom (and Funds) Of The Crowd – I’ve no real experience of this but it’s obviously handy to at least be aware of the emerging new approaches.
  • Good Things Come To Those That Waitdetermination and doggedness are often invaluable and anyway everything always take longer than you ever think!
  • Stick To Your Principles
  • Don’t Be Afraid To Fail
  • Think You Don’t Need A Website? Think Again
  • Keep On Truckin’

It’s not all pontification though – I’m in the early stages of a candidate new business, so all this applies to me too! The aspect that’s most helpful at the moment is strategic thinking and, with it, the determination to say ‘no’ to interesting business diversions.

I’ve written a few posts on this general topic before – here’s a couple that you might find interesting:


It’s World Towel Day!

May 25, 2012

Watching BBC Breakfast this morning, I was surprised to find out that it’s World Towel Day today – May 25th! It celebrates the life and work of the author Douglas Adams (best known as the creator of The Hitchhiker’s Guide to the Galaxy).

To give a flavour of the towel theme:

More importantly, a towel has immense psychological value. For some reason, if a strag (strag: non-hitch hiker) discovers that a hitch hiker has his towel with him, he will automatically assume that he is also in possession of a toothbrush, face flannel, soap, tin of biscuits, flask, compass, map, ball of string, gnat spray, wet weather gear, space suit etc., etc. Furthermore, the strag will then happily lend the hitch hiker any of these or a dozen other items that the hitch hiker might accidentally have “lost”. What the strag will think is that any man who can hitch the length and breadth of the galaxy, rough it, slum it, struggle against terrible odds, win through, and still knows where his towel is, is clearly a man to be reckoned with.

Here are some nice quotes of Douglas Adams including

Solutions nearly always come from the direction you least expect, which means there’s no point trying to look in that direction because it won’t be coming from there.

The impossible often has a kind of integrity to it which the merely improbable lacks.

The cast of the BBC radio show has reunited and will be touring the UK during June and July 2012 – I saw a excerpt, it looks really good, so catch it if you can!

Picture credit: here.

Is Good Advice Any Good?

May 24, 2012

‘Be warned against all “good” advice because “good” advice is necessarily “safe” advice, and though it will undoubtedly follow a sane pattern, it will very likely lead one into total sterility – one of the crushing problems of our time.’ – Jules Feiffer (cartoonist)

I’m often asked to give advice, and (like many people) I often do this even if I’m not asked. The above quote made me think about the inherent limitations of this!

Maybe it’s better to have two different viewpoints – “safe” and “novel” with commensurate risks and rewards, with both being on an equal footing?

Being Brave Enough To Make Smart Guesses

May 9, 2012

Enrico Fermi, Nobel Prize Winner, Physics (1938)

For the past few months I’ve been researching the music industry as a colleague and myself are toying with some ideas we have in that area. Neither of us have worked professionally in that industry although between us we have alot of experience as ‘users’.

It’s an interesting area as there’s alot of really good free stuff provided by volunteers that sits alongside that from the conventional commercial players.

One aspect of what we’re doing is coming up with a viable business model as well as (importantly) doing the research that supports it.

As with the hi-tech businesses I’m more used to, getting good research data is often quite hard and guesstimates are required. The problem is that quite often, in the absence of market data, random and highly ambitious guesses are made or, even worse, the whole area is dismissed as unimportant via ‘that’ll sort itself out’.

So when I read Seth Godin’s post today on ‘How to make money online‘ it rang quite a few bells as well as giving me a wake-up call! He also referred to his previous publication, The Bootstrapper’s Bible.

Reading this through, I came across these extracts that discuss ‘smart guesses’:

When I interview people for jobs, I always ask, “How many gas stations do you think there are in the United States?” Not because I care how many gas stations there are, but because it gives me an insight into how people solve problems.

The vast majority of people who answer this question (Iʼve asked it more than 1,000 times over the years) start their answer with, “Letʼs see…there are 50 states.” They then go on to analyze their town, figure out how many gas stations there are, and multiply from there.

While this is better than some approaches, it is a ridiculous way to answer the question or to plan a business. North Dakota is not like Michigan! And your life, your neighborhood, your friends, and your needs are not like everyone elseʼs. The best way to answer the question is to start with a scalable metric — either cars (how many cars lead to how many stations) or, surprisingly, how many big gas companies there are. Either one will get you to a quick and defensible analysis.

Remember when I said I like to ask people how many gas stations they think there are in the United States? Well, the worst answer (and the main reason I ask) is, “I donʼt know.”

My response is, “I know you donʼt know. I want you to make a smart guess.”

Nine times out of ten, people refuse, in one way or another, to guess. They donʼt want to be wrong.

Most people hate to be wrong. They hate to make a statement (or, even worse, to write something down) and then be proved wrong. They donʼt like to buy the wrong car, vote for the wrong candidate, wear the wrong shoes.

Instead of starting the business that makes stuff for people just like you, do some real re-search. Go to the library. Donʼt invent something that requires you to have a handle on the purchasing habits, the psychographics, and the changing demographics of the whole country. Instead, find a thriving industry and emulate and improve on the market leader. Sheʼs already done your homework for you.

If you’ve read this far, you might be wondering why there’s a photo of a physicist who won a prize in the 1930s at the top of the post. The reason is that Fermi had an exceptional ability to make (very) smart guesses and consequently this area has become known as asking Fermi Questions (or solving Fermi Problems). These are associated with the back-of-the-envelope calculations which are probably much better known. It’s a fascinating area and it’s surprising it’s not used more, especially in business. It’ll obviously be ‘sloppier’ but that’s not the point, as above.

In case you’re interested, there’s a fairly recent book on the subject – Guesstimation: Solving the World’s Problems on the Back of a Cocktail Napkin.

Picture credit: here.