My Thoughts by Rick Stephens

Is It Time to Lose Your Dream?

Posted in Customer Service,General Business by Rick on the November 10th, 2008

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We all have dreams. Dreams are the foundation to success. I tell people all the time that when they lose the vision of their dream, they have stepped onto the path of failure. I have a slogan that says,”Restore your vision and live your dream”. I would never tell someone to give up their dream, because dreams are what our future is made from.

Did I say “Never”? That’s something else I avoid saying, “Never.” So perhaps I should rephrase my comment to “I would rarely tell someone to give up their dream.” So now that we can accept that I might tell someone to give up their dream, what would be the “Rare” circumstance that would cause me to do that?

This is certainly not an easy concept to swallow, so let me clarify by saying, “There might be times when you should re-focus your vision so that you see your dream differently.” Let me explain. Suppose you have a dream to build your business into the next Microsoft. With a keyboard in front of you and a blank document open on your monitor, you begin to think about all the money you will have once this new piece of software hits the market. But what software? All you have is a blank document on your monitor. Without a vision of how you can offer your customers something significantly better than what is already available, your dream to become the next Microsoft is unachievable.

So perhaps for now, you should lose the dream of becoming the next Microsoft and re-focus your dream on developing something that will be a revolutionary benefit to the world. Do you think that when Bill Gates was talking about building an operating system for IBM, he was thinking “Wow, if I get this deal I will become the richest man in the world”? Probably not, but I suspect he thought this would be a significant opportunity to offer the world something they have never seen before, something that could revolutionize their lives for the good.

It’s impossible to cross an ocean without first thinking about how you will cross it. It is also impossible to build a Microsoft without first thinking of how you can benefit your customers. This brings me to my point. You won’t become the next Microsoft if you are not focused on your customer. So let me suggest that in some cases, maybe yours, you should lose the dream of becoming the next Microsoft and begin to dream about how you can bring value to your customers. When your customers receive value from your products or services, your company will grow. The more value you bring to your customers the bigger you will grow. Bring enough value to you customers and you could become the next Microsoft.

To Your Success,

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Do You Know the Rules?

Posted in General Business,Leadership by Rick on the May 2nd, 2007

I’ve been watching my local basketball team, the Dallas Mavericks, struggling in their first round of the playoffs, hoping this is the year they take it all. I still have confidence that they can win, but an interesting thing occurred to me during last night’s game. I was talking out loud to the TV as I often do during ball games (I think it’s a guy thing) and many times I would shout something like “That looked like goal tending to me!”, or “That wasn’t Charging!”.

My wife patiently read her book as all of this was going on but finally she looked up from her book and said “How do you know all these rules?” It made me take a moment and think as to why some people know the rules better than others, not only in basketball, but in all sports. I examined my own knowledge level of sporting rules and quickly determined that even though I may watch all kinds of sports, baseball, football, golf, Hockey, etc., there are some sports in which I understand the rules better than in others.

I tried to think about why that was so, and eventually I came to the conclusion that the sports that I actually participated in as a youngster were the ones in which I had the most knowledge of the rules. I believe this is probably true with most people. If you have ever played baseball you probably understand what an infield fly rule is all about and why it exists. If you have never played golf you probably don’t completely understand when and where you can take a non penalized drop or how it is done.

I believe this is true in the business world as well. Those of us who have gone through the trials and tribulations of running a business have made enough mistakes that we are quite familiar with what will work and what will not work, the rules so to speak. Just because we might have an advanced business degree doesn’t mean that we know all of the rules. A degree by itself is probably similar to watching the sport but never playing it.

This brings me to the point of this article; never underestimate the value an experienced advisor can bring to the table. Many business people will fail simply because they did not know the rules they were playing under. Keep your business advisor close and consult with him/her frequently. Their EXPERIENCE will make a significant and positive impact on your success. You’ll soon be playing the game of business with a high level of knowledge. It is a lot more fun when you understand the rules.

The last thing you want is to hear the referee blowing his whistle, pointing at you, and slapping a penalty on you because you did not understand the “3 seconds in the paint” rule!

To Your Success –
Rick's Signature

Do People Really Make the Difference?

Posted in Blogroll,Developing Processes,General Business by Rick on the April 15th, 2007

Help WantedI was having a discussion with a banker friend of mine who suggested that businesses that were successful were good at identifying and hiring high quality people. I disagreed. Ouch! That is totally against the grain of conventional wisdom, right? Not really.

More important than hiring high quality people is establishing solid and proven processes that make your business work. Take a look at McDonalds. This business is successful, not because of the quality of the people, but because of the quality of the processes that the people follow. This is why over 75% of franchise businesses succeed while 90% of start-ups fail.

So what is the lesson here? As a small business owner, you should focus your attention on defining what works and what doesn’t in your business. Measure your activities to a point, so when asked, you will know exactly how long it takes for the fries to cook, when to flip the burger and exactly how much secret sauce to put on the bun. If you have defined your business processes to this level, all you need are employees willing to follow your rules. The rest will be automatic.

That’s not to say that you should hire just anybody. On the contrary, as you grow you will want to hire people that are loyal, trustworthy, innovative, and talented. These people will become the backbone of your company. In the beginning, however, what you need are technicians, workers who can free up your time so you can work on growing the business.

In the early days, the secret is loyalty. Employees that are willing to follow your rules are more valuable than experts that think their experiences will contribute to your success. If you have done your homework, you already know what works and what doesn’t. Hire those who are willing to follow and your profits will be better than those who pay a premium for the experts.

To Your Success -

Rick's Signature

Where Has All My Money Gone?

Posted in Business Control,General Business by Rick on the April 3rd, 2007

 

Burining MoneyI had spent several weeks working with my client getting their books in order and we were now finally able to review a pretty decent Balance Sheet. By that I mean one that was accurate, not necessarily pleasant to look at with tons of money lounging around in the asset area.

I spent a few minutes reviewing with my client what each of the areas were representing, liabilities, assets, equity, etc., when I saw a confused look on the business owner’s face. “What’s the matter?” I asked. “Well”, he said, “I don’t understand why the Balance Sheet shows that I am making pretty good money, but I don’t seem to be taking any of it home.”

So we printed a copy of his Profit & Loss Statement for the year and began to review it as well. Again, this document was an eye opener for my client, a document that was not available prior to this time because of all of the inaccuracies in their book keeping system.

As we began to go over the details I commented to him that one of the biggest culprits causing money to disappear was not controlling expenses. “But we don’t spend money on things we don’t need.” he said. “As you can see, we buy equipment for resale, pay our employees, buy needed office supplies, pay our accountant, attorney, and of course you, but we don’t spend money on unnecessary things. So why don’t I have more in the bank?”

“Are you sure that you only spend money on necessary things?” I replied. “Have you filed your taxes for the year yet?” “Not yet.” he said, “We had to file an extension because we were not ready.” “Oh” I said, “An unnecessary expense because your books were shabby, and how about your payroll taxes? Looks like those were paid a little late last year as well.” “Yes” he said sheepishly, “Another unnecessary expense, I guess.”

I went on to explain to my client that controlling expense means more than just the obvious areas of the business, because it is the hidden, extra expenses, that erode your profits. Keeping your books in order is essential to controlling these types of costs.

Running a business is not easy, if it were, everyone would be doing it successfully.

When I was going through basic training in the military (A while back!) we were made to polish our soap after each shower. I thought it was pretty stupid at the time, but in retrospect, I understand the symbolism of that task. Don’t allow the things you use daily (financials, client records, invoices, etc.) to become unattractive and in disarray. Showering with a clean bar of soap will not only make you feel better but will demonstrate that you are a stickler for details, an essential ingredient for success.

To Your Success -

Rick's Signature

Loyal Customers Will Persevere

Posted in Customer Service,Developing Processes,General Business by Rick on the March 23rd, 2007

Being in business for yourself is tough. It gets really hard when you come to realize that you need to make a significant change to the way you do business and this change will impact the customer. Perhaps the change is an increase in price, or a change to the way you extend terms, or maybe your product line has to be updated.

When this happens, owners will formulate what I refer to as SID, Self Induced Doubt. They become afraid to make the needed decision to improve their business practice for fear of loosing their customers.

Loyal customers (and you do have loyal customers, right?) may show some resistance, but that is a natural response by everyone when it comes to change. Astute owners will recognize that loyal customers have chosen them as their company of choice, and hopefully you have nurtured that relationship and demonstrated that you truly care for them as customers. Loyal customers will understand that change is necessary to stay competitive, to continue providing top quality products or services, and to ultimately stay in business.

The trick to successfully transitioning in these instances is to position the change as a benefit to the customer. Give them notice of the change and offer assurance that the change is a good thing for them. Your loyal customers will stand by you, your satisfied customers will complain, but stay, and your unhappy customers may leave. So, am I saying that some customers will leave? Possibly, but those that do were probably problem customers anyway, late with payments, asking for unreasonable service, etc. If they leave, perhaps it will be a good thing. Your company will be stronger for it.

Don’t be afraid to change. Without change there is no improvement, there is no progression, there is no growth.

To Your Success –
Rick's Signature

Your Image Makes a Difference

Posted in Attitudes,General Business,Marketing Strategies by Rick on the February 14th, 2007

Raising the Flag on Iwo JimaThe other day I watched a very compelling movie produced and directed by Clint Eastwood called “Flags of Our Fathers.” It was the story of the WWII battle of Iwo Jima and the resulting media coverage in the US promoting the famous picture that resulted from that event. The message that came from that movie was interesting and one that we as business leaders should understand if we want to be successful.

The message was that image is more important than reality. According to the movie, the celebrated picture of the six Marines raising the flag atop the pinnacle of Iwo Jima was not taken when the flag was first raised, but in fact, at a later time after the battle, during a relatively calm moment. Although not staged, the raising of this flag did not occur during the heat of battle, as implied, and the men who raised it were not the same ones that planted the flag initially.

Our leaders at the time were quite aware that this photograph, and the men portrayed, was not as it seemed, but they seized the opportunity to create a gripping image of our brave Marines at a time when this country needed hope and the support of those at home. It worked.

As a business, it is vital that you maintain an image that reflects exactly what it is you want the public to see. If you own a restaurant, you don’t want patrons to walk in and see dirty tables, floors, or counters, the negative image will stay with them and your business will suffer. If you own an auto repair shop, you want your employees driving clean undamaged vehicles. If you own a florist, you want all of your flowers to be fresh and attractive. If you are a doctor or a lawyer, you want your clients to see you as being successful by creating images of professionalism in your office or waiting area.

Be very careful when making decisions about your image. What people see is what you will become. It only takes one moment for your prospects to decide if you are credible or not. The image they see will determine your success or failure.

Hanging in my office, is a picture of Pete Rose, the baseball player and manager, sliding into home plate in the style that made him famous, headfirst. He was once quoted as saying.” …And there is one more important reason that I slide headfirst. It gets my picture in the newspaper.” Be careful with your image, it is more important than reality, because it defines reality.

To Your Success,
Rick's Signature

Are You Choosing To Fail?

Posted in Attitudes,General Business,Leadership by Rick on the January 23rd, 2007

Fixing a CarIt is an interesting phenomenon with us humans… we migrate toward those things that are harmful to us as individuals, as a people, and also, as business owners. We go through life making choices on how we live our lives, the activities we participate in, the things we watch, and the things we eat, all of which become the essence of who we are. Left to themselves, things will deteriorate. It takes positive effort to cause improvement. Unfortunately, it seems that we have a propensity to take the easy road in life, the one that allows things to decline, instead of the hard road which yields positive improvement.

Take a car for example. If all we ever do is drive it around town, or worse yet, let it sit in our driveway, what happens? It begins to fall apart. To keep the car at its peak, we need to change the oil regularly, rotate the tires, check the belts, insure the proper fluid levels, and myriad other inconvenient maintenance chores. If the car just sits, it will begin to rust, tires will become flat, fluids become sludgy, etc. In other words, left to themselves things deteriorate. And so do we.

We choose those things in life that are harmful to us. We choose to sit on the couch and watch TV instead of going to the gym to work out. We choose to eat pizza and fast food on the run instead of taking the time to sit down to a quiet, healthy dinner. We choose to dream and never take action to see it fulfilled. We choose to let others decide our political leaders instead of voting ourselves. We choose to pollute our air instead of applying technology to keep it clean. We choose to build bombs instead of relationships. As business owners, we choose to let the status quo determine our fate instead of applying change proactively to improve our lot.

Kermit the frog once said, “It ain’t easy being green.” We are all green when it comes to life, and believe me it’s not easy. We must take an active approach to make a difference in our lives as individuals, as a people, and of course, as business leaders. We must force change. Left to themselves, all things will crumble. If a year from now you are doing the same things you are doing today, you will be worse off for wear and tear. Lack of change means failure. Are you choosing to fail?

To Your Success,

Ricks Signature

Taking it to the Bank

Posted in General Business by Rick on the October 31st, 2006

I was watching an episode of Grey’s Anatomy the other night and one of the characters had received a check from a patient that had died. The amount of the check was $8,700,000. Throughout the entire show her roommates kept encouraging her to deposit the check but she kept procrastinating taking it to the bank. Although she kept telling people she was now a millionaire, she was not. Being a millionaire was certainly within her reach, but she just never could take the final step necessary to make it real. When the show ended, she placed the check on a bulletin board and left it there. Her millions, though only a trip to the bank away, were nothing more than a piece of paper with a stick-pin in it.

It occurred to me that many business owners do the same thing everyday. Their dreams are right in front of them, simply a trip to the bank away, but for some reason they just don’t take the final step necessary to make it real. They would rather procrastinate than do what is necessary to reach their goal. Maybe it’s the fear of success that prevents them from taking the step. It could be that they don’t understand how close they are, or maybe they would rather imagine the dream than live it.

Here’s an example. I spoke to a business owner last week who was ready to retire and move out of the day to day operation of his business. We discussed how to do that. We could locate a talented manager to run the business, start examining the books to get a better handle on income and expenses, begin reducing unnecessary inventory, work on reducing long term liabilities, and properly valuate assets. Within a year or so, the business could be sold and a nice retirement for the owner would be realized. The owner leaned back in his chair with his hands behind his head, in that posture one takes when they daydream. In a minute or two he looked at me and said, “Well, perhaps I’ll take a look at doing that next year.” At that moment, though his retirement was only a drive to the bank away, he pinned the check to the bulletin board, and went on with his normal routine.

What about your dream? Are you taking it to the bank, or Is it pinned to the bulletin board?

To Your Success -

Rick's Signature

Good Goodwill

Posted in General Business,Selling Your Business by Rick on the October 24th, 2006

I have spoken to several business owners recently who have said to me that they would like to position the company for sale within the next 3 to 5 years. All of these businesses were financially strong with revenues in excess of $3 million a year.

After speaking with them for awhile, each of them made another interesting comment. They said that they were not interested in growing because they would then have to hire and manage supervisors and additional employees and that would be too much trouble. It would also cause them to lose touch with their customers, which gave them a competitive advantage in the area of Customer Service and Quality Control.

I asked each of them how much the company would be worth without them being there. They all agreed that it would be worth less than their financials indicated, because they were the company. My next question; “So if you go away for a long period of time, what would happen to the business?” Again the answer was basically the same, “It would begin to lose money.”

Can you see the problem here? How can these successful entrepreneurs position their business for sale if all of the Goodwill is positioned on their shoulders? It will be very difficult at best.

So, I respectfully suggested to each of them that they were not doing themselves a favor by staying so close to the business. It was imperative that they start today putting processes in place to allow others (Yes, they may need to hire supervisors and more employees) to run the business. This was not going to happen in just a few months. It could in fact take the entire 3 to 5 years to reach this objective.

If you intend to sell your business and make what it is worth, don’t get caught with the goodwill in your court. Give it to the business.

To Your Success -

Rick's Signature

Road Signs To Success

Posted in General Business by Rick on the October 18th, 2006

The other day I was driving my wife to the super Wal-Mart that she likes to visit. On the way I said, “Let me show you a short cut that will cut off about 2 miles and maybe 5 or 6 minutes of driving time each way.”

I then proceeded to turn down this obscure road and in just a few seconds we re-entered the main road. We had indeed cut off about 2 miles of driving. My wife said, “Do you just drive around looking for strange roads and follow them to see where they go.” “No”, I said, “But I do pay attention to road signs and when I see two that appear to be the same road, I will make an educated assumption that the road will lead to the same place where I saw the other sign.”

Business is much like this. We must keep our eyes open and look for the relationship between signs. When we see them we can feel reasonably sure that the two are connected. By looking for these short cuts in business we can leap ahead of our competition.

Here is an example of what I mean. Suppose you had an Automobile Window Tinting shop. You could spend thousands of dollars on various advertising to get a new customer to come through the door or you could look for the connecting signs. A Windshield Repair shop probably meets with the same types of customers that you meet with. If you could establish a relationship with the Windshield Repair business so that they would refer their customers who need window tinting to you, and you would in turn, refer those who need windshields repaired to them, do you think your walk in business would improve? Probably, and how much would it cost? Nothing more than a few business cards and a solid business relationship between the two companies.

That’s how you connect the signs in business.

To Your Success,

Rick's Signature