Fran Biderman-Gross calls herself the “Strategista” of Advantages, a New York City-based company that helps companies to get noticed through branding, marketing, and print production management. Her professional background includes more than twenty years’ professional experience in the niche print industry, but when it comes to her Paper Napkin Wisdom, she's all about turning things upside down (or in this case, on their side).
If you envision the traditional sales funnel, you see a Y-shaped graphic with all the effort of your business focused on eventually converting hundreds (if not thousands) of leads from the top to one or a handful of customers at the bottom. Tradition says that this is a numbers game - increase the number of leads, you increase the number of prospects, and eventually, you increase your number of customers.
Fran's take: tip the funnel on its side (so it looks like a megaphone) and concentrate on what you're projecting out into the world. What you project should be singular and simple; focus on this “one thing” that you put into the megaphone because it has the ability to spread - and what you wait to hear is the echo. The echo means articulating the purpose of your company so well that only like-minded people respond.
There certainly may be difficulty in accepting the idea that you should stop selling to people (and accepting customers) who don’t echo your message. By focusing on those that echo your message, however, you create ambassadors of your brand. You create an indirect sales force that gives you the flexibility to abandon those middling clients that you accepted just to help keep the lights on.
Think about Apple. If Apple communicated in a "traditional" way, they would talk about what they do and why they’re different. “We make great computers. They’re beautifully designed and simple to use. Want to buy one?” Instead, they draw from the inside out - why they exist - through inspiration. “We challenge the status quo by thinking differently. We just happen to make computers.” Which one of those two messages resonates better with their customers?
As a result of this commitment to the projection of purpose, Fran’s business has grown in the neighborhood of 700% since she discovered this philosophy. In her experience, if you shrink what you do, you actually grow. Focusing on the “one thing” you’re really good at allows you to become the master of your field. The process to find the “one thing” was painful for Fran and her business - a trial by fire - until they started focusing on the client and service what they need (as opposed to trying to shoehorn their services in). Eventually, the trust that is developed creates a relationship where clients are describing a problem that requires a solution, rather than asking for a specific product or service.
Tip your own sales funnel on its side and project your true purpose to the world. Begin the journey by discovering what is important to you (and why). Then answer those questions for your business. The process is trial and error, but will eventually yield the ability to build the necessary trust with your customers.
Rich Mulholland has had one of the more an entrepreneurial careers of all the Paper Napkin Wisdom contributors. He started out as a roadie for bands like Iron Maiden, Def Leppard, and Bon Jovi and eventually realized that there was a lack of energy in the industry during the winter months in South Africa.
Driven by his entrepreneurial spirit, he took the initiative to adapt the “rock show” model to corporate clients. He started out by dressing up corporate speeches and presentations with pyrotechnics and grand theatrics, but quickly realized that he was solving the wrong problem: he needed to work on the presentations themselves, rather than the theatrics surrounding them. This was a result of the intense hatred that Rich (and really, all of us) had for boring presentations - it is also the motivation for his contribution to Paper Napkin Wisdom: "“We all need to fall in hate with something.”
An oft-cited quote from Ghandi says that if you do what you love, you'll never work a day in your life. According to Rich, however, this is antithetical to the entrepreneurial motivation: entrepreneurs tend to look at things we hate in the world and say “we can fix it." The entrepreneurial spirit, in Rich's mind, arises from a passion about something so frustrating that the desire to change it becomes overwhelming. This desire ultimately spawns two ways to approach a solution as an entrepreneur: fix a problem or fill a gap.
Contrary to Ghandi's perspective, if you end up doing what you love, your passion will become your job, and cease to be something you love. Rich's approach, on the other hand, has allowed him to separate life effectively - hobbies, loves, passions don’t get in the way of work and vice versa. He has become empowered to explore both avenues of himself - work and life - independently and learn dual channels of lessons. The resulting philosophy: “love how you do what you do." It is much easier to be passionate about something that frustrates you; call it an itch to be scratched.
Looking back to Rich's origins in the music industry, we see the true motivations for an entrepreneur: for any market that lacks an expert, whomever puts their hand up first and says “pick me” is the expert by default. Unfortunately, most entrepreneurs are so busy running their businesses that they aren't open to spotting a problem when it arises. "Being busy" has become a status symbol; a hallmark for success.
Having the capacity to solve the dilemmas of entrepreneurial businesses requires a freedom from "being busy"; a commitment to balance. If we think of our business as a support structure for our personal lives - having a better life means taking the time to do the things you enjoy and spend time with people you love. Once you reframe what success means, it is much easier - and you are more empowered - to prioritize.
Alan Miltz’s 20+ years of executive background ranges from founding director of Inmatrix Pty Ltd through to most recently, director of Pearl Finance Australia. Alan has extensive experience across all major finance fields, including financial analysis and debt finance boosting, and spends a large amount of time helping entrepreneurs handle their banking relationships, cash flow analysis, and other financial matters. His Paper Napkin Wisdom reflects this level of expertise: “Revenue is vanity. Profit is sanity. Cash is king.”
In Alan's experience, most entrepreneurs and CEOs only want to talk about revenue, margins, profit, etc. Profit, as Alan puts it, is an opinion - you can manipulate it to any degree necessary to fit your message. Here's another way of thinking about the relationship between profitability and cash flow: businesses speak Spanish, but banks speak Portuguese. A competent business owner must be fluent in both because banks talk about cash flow as an ability to service your debt.
There are four facets or chapters of almost every business, especially those of an entrepreneurial nature. The first chapter is that which every entrepreneur is already well-versed: profitability. Business owners understand chapter one well because it is reflected in revenue growth, margins, EBIT, and other familiar metrics. Chapter two - your working capital cycle - is also reasonably well understood by most entrepreneurs. This includes receivables and debtors, collections, inventory management, speed of bill for services, supplier payment.
Chapter three is defined by what you do with your business after the considerations of chapters one and two: infrastructure or other capital investments. How are you handling your cash flow and what are you doing with it? This, in combination with the first two chapters, is also how chapter four is defined: your cash flow. In Alan's experience, about 60% of companies are profitable but have very tight cash flow - this ultimately harms growth. After considering these four facets or chapters of your business, you must ask yourself: "do I have enough cash flow to finance my growth?"
Regardless of the answer to that question, you can rest assured that your cash flow will be defined by what Alan calls "the power of one", or a 1% positive change in one of seven levers that any CEO can pull at any time. Price, volume, cost of goods, overhead, payables, receivables, and inventory are your seven levers; the most successful entrepreneurs understand these seven levers - and when to pull them - in order to drive growth.
Alan's background means that business owners come to him when they have trouble working with their bank(s). His expertise tells him that when a bank puts pressure on you, it doesn’t mean they don’t understand your business. It means you have a cash flow problem that must be fixed through the power of one. Put another way, the power of one is a summary of strategic plan - price/volume = marketing, cost of goods = operations, overhead = everyone, collections = finance/sales, inventory = operations. Everyone in your business must understand how they impact cash and ultimately, behavior will change in a positive way when company culture embraces this philosophy.
Dr. Heidi Hanna is CEO and founder of SYNERGY, an integrative neuroscience partnership that provides brain-based training for individuals and organizations. Heidi’s publications include the NY Times best seller The SHARP Solution: A Brain-Based Approach for Optimal Performance (Wiley, Feb 2013), and the follow-up release Stressaholic: 5 Steps to Transform Your Relationship With Stress (Wiley, Jan 2014).
In addition to those accomplishments, Heidi also attended college on a full scholarship to play softball. As a pitcher, she quickly realized that athletes share a common awareness of the window they possess to perform an optimal level. She also discovered that most high-performing athletics perfected ways to recharge their energy in order to continue performing that those levels. Finally, as with any pitcher, she become intimately familiar with the pitch counts imposed upon her.
Throughout these experiences, it became clear that energy is our most important resource. In softball (and baseball), a pitch count is a regimented tool design to allow pitchers to recharge their energy appropriately. Similarly, in tennis, players only spend an average of 35% actually playing the game; the remainder is spent restoring their energy levels. As you can imagine, this tactic translates seamlessly into the non-sports world and especially to entrepreneurs.
Stress can initially provide stimulation for achievement, but prolonged periods or intense levels of stress will ultimately diminish our ability to be resilient. For entrepreneurs, installing a schedule that allows for energy restoration can be difficult and feel uncomfortable.
Physiologically, however, we are designed for it. Before the technological advance of the previous century, most humans scheduled themselves around natural daylight. With the advent of artificial light, it became easier to work beyond the limitations of nature. The advances of the last decade have exacerbated those habits further, as it is now possible to be constantly connected and consistently running at full capacity.
This eventually leads to "tolerating" life, as opposed to finding a true rhythm. As such, we must determine our own pitch count in order to recognize when we need time to recharge. Think of the process as coupling periods of strategic engagement with periods of strategic disengagement. Down time doesn't mean surfing the web, watching TV, or checking email; rather, it means allowing your mind to fully recharge. A simple start is to schedule time blocks for 50 minutes instead of one hour to automatically build in a 10-minute window for energy restoration.
Make a proactive effort to be at your peak when it matters most, rather than trying to maintain that peak at all times. Identify what's most important in order to capitalize on those moments. This can be accomplished through an "energy audit". Monitor your sleep habits (amount of time, sleep preparation and technology cut-off, positive morning rituals). Embrace nutrition - your body's fuel. Maintain a balance of movement and rest to keep from overcommitting to one or the other.
Entrepreneurs can easily fall into the trap of thinking "it's all about how much I can get done, and how quickly". The more intense the situation you prepare for, however, the more recovery time that will be required. If you enter each day with intention and remind yourself that in order to speed up, you must slow down, you will avoid that dreaded entrepreneurial pitfall: burn out.
Long-term commitment to recharging energy creates the longevity necessary to leave a legacy. Perfecting this process will even allow you to then coach your team in managing their own pitch count. Health, happiness, relationships, business all will improve.
Create a recharge revolution!