THE MONEY ACADEMY
The secret connection between
fears & business development
By Osnat Peled, General director - Mentor Finance (Private equity) & BWFR president.
„I know her for over 2 years, but this time she looked concerned. “What is bothering you? “
I asked, and she replied immediately -
“I was thinking lately to start a new service under my PR & media relation company. I believe it will bring me new clients and I can increase my profit immediately from the first client…. “
“So what is the problem, what are you waiting for?” I asked,
“the problem is that I have no idea if it’s going to work, I have no idea if I’m going to be good on that… I feel terrible"
(Adina, 32, owner of a PR agency for 8 years )
Me & my comfort zone
Being an entrepreneur is a task that does not fit everybody, it involves stress, self-management and requires endless optimism.
In the life cycle of every entrepreneur, once you passed the first 2 years, you are entering into a comfort zone, where you know already your cash flow, you have already several good clients, with a clear income, you know your competitors, you know why you are better than them and you feel secure in doing what you are doing. So far so good…no?! Well, NO!
One of the big mistakes entrepreneurs are doing is by getting used to their comfort zone, while the reality shows, there is no such zone actually.
How can you know you are stuck in a comfort zone? Try to answer yourself (sincerely) on the following questions:
Am I meeting any new potential clients on a weekly base?
Do I apply new strategies from time to time or use only the ones I know?
Are there any new workers in my company?
Have I applied any kind of financial investment in the last period within my company?
Am I updated with what my competitors are doing?
If you didn’t answer “YES” to the majority of the questions, that means you are indeed staying in your comfort zone, when the results can be devastating to your business both on the long and the short terms
While you were sleeping ….
In 2014, Nokia, one of the world-leading communications and information technology company, employed 61,656 people across 120 countries, did business in more than 150 countries and reported annual revenues of around €12.73 billion
in 2016, During the press conference to announce NOKIA being acquired by Microsoft, Nokia CEO ended his speech saying this “we didn’t do anything wrong, but somehow, we lost”. Upon saying that, all his management team, himself included, tore sadly.
What happened to Nokia? How come they fall from a market-leading worldwide company to this? And even more disturbing, is asking- how come their management didn’t notice they are on this negative path?
The answers are sourced from the same route- Nokia failed because they didn’t change.
While there were sleeping in their comfort zone, the competitors were investing full capacity, and once Nokia woke up it was already too late….
While you are sleeping, not sure, rethinking or hesitating, someone else is already on the same path moving ahead. This is a fact.
Staying in your comfort zone is actually one of the biggest risks for your business.
Think like Microsoft
We are all used to read about the mega-companies and their Research & Development departments (R&D)
Many of us probably think “I’m not Apple…I don’t even have an r&d budget…”
A closer look at one of the most interesting researches (done by Booz & Company), reveals a striking reality.
The chart shows how the top 10 most innovative companies, among them- –Apple, Google, 3M, GE, Toyota, Microsoft, P&G,
IBM, Samsung, and Intel –all are spending hundreds of millions $ on R&D.
Take a closer look to see their rank and their sales, to be shocked with this correlation - the top 10 innovators had better financial performances than the top 10 R&D spenders.
Even though numbers probably changed, the mechanism remains the same – the ones who invest more in R&D will generate more sales. You do not have to be Microsoft or Toyota in order to implement this mechanism, but you must be honest with yourself first – do you invest anything in R&D?
Fears from the unknown
Going back to our dear Adina, owner of a successful PR agency for the last 8 years.
She is obviously in her comfort zone, but wisely identified she needs a change. Yet she has a lot of fears.
Adina’s Fears are actually very normal.
We are usually afraid of whatever we DON’T KNOW. The unknown is frightening and brings scary thoughts (sometimes unrealistic ones) to our
mind – Will I lose money? What if I fail? What if I’ll be good and will be copied? What will my colleagues think about me? Etc…
We want to believe that only the one who dares will actually win, but I want to add to that – “only the one who wisely dares, will actually win”. Knowing to anticipate the risks, choosing the next step and building the right strategy, based on a wise development plan, is the key to save you from making most of the mistakes and step up your business.
In this context, knowhow is a very powerful tool and the way to achieve this knowhow goes first from your R&D, exactly the same one that any business, big or small, must do on a daily base (yes – daily, I’m not wrong!).
My Micro R&D guideline
Whether you are seeking to increase your innovation level or simply keep your market position, the required steps are essential to evaluate if you are on the right track:
1. Follow your competitors - the big ones and the small ones.
2. Keep on learning - news & trends related to your domain
3. Join networking groups, seminars and workshops to stimulate your creativity and increase your networking contact.
4. Meet with your suppliers and gather new information about market trends from their point of view
5. Consultation / Business Advisory - All the market-leading companies are working with specialists & advisors.
You can do it within your personal scale. Find a suitable working frame to support your business development.
6. Benchmark – once you saw a nice idea …do not copy – think how you can upgrade & make it better!
Innovation is a state of mind, you can achieve it once you dedicate at least the minimum resources requires, or else you will find yourself forever within the comfort zone or in an unwanted retreat….
Osnat Peled (Israel) serves as - General Director of Mentor Finance Private Equity Investments, an expert advisor in Mentor Capital & Business Advisory (www.mcba.ro) & the President of Business Women Forum Romania (www.bwfr.org)
Foto: Sebastian Moise Make-up: Monica Panait Şedinta foto a avut loc la Hotel Prince Park Residences Bucureşti *Articol apărut în Business Woman Magazine, ediţia 71
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