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Entries in Business Reinvention (7)

Monday
May242010

Why Businesses Fail

You’ve already heard it: 90% of business startups end up in failures. Of those who do stay in business, a very small percentage do well – perhaps about 2% - the rest just get by, barely survive, or stay mediocre.

Why such a high rate of failure? I believe it’s because we have not identified and developed the right business habits that produce the results we want. This is why reading books does not make us successful, healthy, fit, wealthy or even happy. Neither do writing a thesis or graduating with Honors from an Ivy League University.

Business Building is a sport. You can’t learn how to play tennis or golf by reading a book, writing a thesis or graduating with Honors after two years of intense studies. The theoretical knowledge is a good start, but to truly master the sport, we need to engage with it emotionally, enjoy it, practice it often, and master it in small incremental steps.

What we habitually, consistently do, perhaps even without thinking, like driving a car, defines us to a great extent. Our habits drive our successes and our failures. Our habits make us efficient or inefficient. Our habits make us healthy or unhealthy, sharp or dull, wealthy or poor.

Because a business is made of people, the same holds true for businesses. The habits of a business defines its character. Habits drive its successes and failures. Habits make it thrive or wither away and die. Habits make it a market leader or a mediocre survivor. Habits bring out great lines of successful products or failures after failures.

Good business habits bring us good results. Bad business habits bring us bad results. Great business habits bring great results and terrific business habits bring us terrific business results.

Needless to say, breaking old habits is difficult. So is building new ones. What makes this process - of breaking old habits and building new ones - especially difficult is the fact that we often really don’t know what habit we should be adopting. We really don’t know what the best practices are for our business’ success.

I have been researching this subject - the best business practices and habits for a successful business - for over 12 years. Some of what I have found is simple common sense. Some of it is truly ground-breaking. And much of it seems like ground-breaking stuff but it really is common sense. It only seems like it’s ground-breaking because the commonly acceptable behavior is so non-common-sensical. Crazy, I know. But there it is.

If we are to succeed as a business, we must committ to reinventing ourselves as the world around us changes. Obviously, continuous reinvention, in small, incremental steps, is far easier than abrupt reinvention.

There is no better way to reinvent our business than to examine, and then change, its business habits, slowly, deliberately, incrementally and constantly. When was the last time you took a long and hard look at your business habits? Are you reinventing your business or are you stuck in the same old habits? Are you driving the change or are you being driven by change?

Want to experience business habits in action? Join us at our next 360 Business Club “business workout session” where you get to practice business-building with like-minded business leaders. 

Monday
Apr262010

A Story of Your Business

A Story of Your Business
By Bhavesh Naik

You set out to build a business,
You had dreamt it in your dreams;
So much of it came true,
But so much didn’t, it seems.

You wanted to be your own boss,
A thought you thought was noble;
But your clients are now your new boss,
See what you got for your troubles.

Money, you thought, would be your friend,
And that your net income would double;
But all you got was worry and worry,
About sales, cash-flow and receivables.

You wanted to change the world, you said,
Like a loud clap of thunder;
All you got was a gig instead,
That you hoped wouldn’t go under.

Nothing is lost, my friend, I say,
As long as you’ve learned your lessons;
You can still build the business you dreamt in your dreams,
But this time, do it without the hassles.

Business-building is a sport, I say,
Don’t think it’s something intellectual;
What you need is a place to practice,
So you can master it for real.

A coach, some friends, a kick in the pants,
If that’s what you think is needed;
Best practices and principles
With which others have succeeded.

That’s all you need, and you have it now
In 360 Business Club;
A Business Building and Support System
To make your business go rub-a-dub-dub.

Give us your heart, your mind and your soul,
And you will discover now;
That business-building is a simple game
That could be mastered; you just need to know how.

—-

Is your business All You Thought It Would Be? Join us as a guest at our next “business workout session” of 360 Business Club. Click here for more information. Click here to register.

Tuesday
Apr202010

Innovate, Reinvent or Do Nothing?

Here are five businesses that are about to fail (Blockbuster, Rite Aid, Border Group, Palm and YRC Worldwide). I think there is a common theme among these five businesses. In fact there are two things, related to each other, but quite different.

First, these companies did not innovate very well, although they did some. Second, they forgot to reinvent their business model when their industry took a sharp turn.

Perhaps the best example of this is Blockbuster versus Netflix. Blockbuster did innvovate their service offerings but not until NetFlix became a threat, allowing no late-fee option for late returns, for example.

But more importantly, they completely missed the shifting fundamentals of the entire movie rental industry. Their competition was offering huge selection not available at Blockbuster; their customer had become Internet literate and preferred to shop from home, and their movie selection process was much more efficient online than walking through the aisles at Blockbuster.

On the other hand, here are two businesses that did very well in 2009 despite their industry (publishing) going through fundamental changes. One is Martha Stewart Omnimedia and the other is Axel Springer, a German publishing company. Both are also poised to do well in the future.

Watch either of these interviews by Charlie Rose (Click for video here: Martha Stewart, Axel Springer) for only 10 or 15 minutes. You will realize that these two businesses did what the failing businesses did not do, which is to innovate and reinvent their products, their services and their business models.

One way to reinvent your business is by changing its business habits, the systems and processes that the people in the business carry out on “autopilot” or subconsciously. When you reinvent your Business Habits, you reinvent your business. (Click here for more on Business Habits.)

What are you doing to innovate and reinvent your businesses, your products and your services? Or do you think that a small business does not need to worry about “such things” as innovation and reinvention?