The landscape of business is ever changing. 2011 is halfway over and already so much has gone down. I imagine most management professionals out there would agree that the first two quarters have felt like a roller coaster.
It's been on my mind to revaluate my company's business plan amid all the changes as of late and create a new plan, budget, goals etc.
But then I got to thinking about the last plan I wrote...it was a great plan but in the middle of following it the economy drastically changed! Some competitors dropped off, many old customers disappeared, we gained new ones and had to learn how to serve their needs, our vendors tightened lines of credit, some of them disappeared too. It felt like we were running a totally different organization.
I've come to realize that business planning and forecasting (especially over the long-run) is really just guessing. There are way too many variables outside of what you can actually control, like: market conditions, your competition, your customers, the wonderful economy and so on. Throughout my years in business school and in almost all the classical publications I've read, managers are advised to write "business plans."
It sounds responsible, yes. But now I ask, "What’s the point?!"
Recently I read this article by Eric Markowitz, where he writes about Araceli Camargo's notion that planning is actually bad for business. Here's an excerpt:
Some research supports this claim. In 2007, The Wall Street Journal reported that “budding entrepreneurs can spend months, sometimes years, polishing elaborate 50- to 100-page business plans that include financial projections, market research, and intricate details on day-to-day planning and organization…But skeptics say there's little concrete evidence that extensive planning is highly correlated to success." Two years later, in 2009, The Journal clarified further, noting that "researchers found no evidence (emphasis added) that either the content or presentation of the plan influences venture capital-funding decisions."
Now I'm a HUGE planner. I'm constantly making plans in my life's personal pursuits - planning events, projects, and things you have control over is a great way to be a productive individual. But the problem I see with planning in the business world is this:
Writing a business plan makes you feel in control of things you really can’t control.
I've come to realize that business is all about improvising. You have to be able to take on an opportunity when it presents itself. I've also learned that you have the most information about a situation when you’re right in the thick of it. Planning before you’ve actually done it doesn’t make any sense; before is the worst time to make an important decision. This is often the reason why you feel incredibly overwhelmed after a long planning meeting.
I'm always thinking about the future and how I should solve problems that I see on the horizon. But I no longer feel like I need to write it down and obsess over it. I use to stress about keeping to business plans, financial projections, and stratagem…but it was a waste of energy because these are all just guesses! When you start to think about it like that, it's really not so serious.
I've decided I'm going to quit guessing. I'm just going to decide what I'll do this week and stop worrying about the rest of 2011. I'll start with the most important thing I can think of and move on from there. This sounds much better than following a plan blindly that has no correlation with reality.
"What you can do, or dream you can, begin it. Boldness has genius, power, and magic in it."
No matter how catastrophic the blunder, how you respond determines everything.
A negative and uncaring response (like BP’s reaction to its oil spill) can have a detrimental impact on corporate image, while a positive and caring response (like Apple’s free cases for the iPhone 4 antenna defect) can have long-term favorable effects that build brand loyalty.
Lesson: Screwing up presents an opportunity for you to show how much you really care.
Developing a culture of safety awareness that is focused on decreasing workplace injuries will reduce medical costs and worker compensation claims. Other side affects include: evading legal responsibility for negligence, increasing morale and productivity, as well as curtailing truancies. Sounds completely positive to me! Any HR professional would agree that a serious focus on safety is the right direction to head. So why aren’t most companies in a hurry to develop such a culture? Well, because it’s hard and you won’t see things change immediately.
Training employees to be safety conscious does not happen overnight, or even in a quarter. It’s a process that is built over the long term (start thinking in terms of ‘years’). It requires helping employees to keep safety on their minds at all times—which in turn requires continuous reinforcement and recognition of basic human psychology.
Safety has to be put into practice and not just talked about. The most effective way to communicate the significance of safety from management to employees is by swiftly responding once a safety issue arises. By doing nothing, or by being slow to respond, sends the message that “this whole safety initiative is not really as big of a deal as management says it is.”
Organizations learn very well from significant accidents. Of course when something significantly wrong happens, a task force is assigned and they get all over it. The mess gets cleaned up and everyone goes back to doing their normal jobs. But what about when the mishap is something small? Maybe something that could be swept under the rug and hidden? Well, organizations aren’t so good at learning from those mistakes, much less acknowledging them.
If the objective is to create a culture of safety awareness, then even the smallest accidents need to be addressed formally. Managers should be asking employees: How could this have been prevented? How should we handle this differently so it does not happen again?
A great way to increase safety and awareness of it is by collecting data (we’ve all seen the sign: “Insert number here” Days Without an Accident). In order to create a safe workplace there needs to be rewards for reporting. If there’s an incentive to report, you’re going to get a lot of input. This will make things seem like they’re getting worse, but they’re not…you’re just starting to learn about it. The positive side of providing rewards for reporting is that employees start to become engaged in the culture of safety awareness.
The essential idea in cultivating a culture of safety awareness in the workplace involves consistency and dedication to true change. If management really cares about safety, then when someone reports a problem, they pay attention, offer feedback and publicize it throughout the workplace.
We all struggle through learning curves because they’re really hard at first. In The Dip, Seth Godin will help you determine whether you should keep trudging through the difficult process or quit it altogether.
If you decide to stick with whatever you’re learning, whether it’s a musical instrument, calculus, programming, cooking, chemistry, or baseball, it’s important to understand that natural genius is a myth.
Recent scientific findings support the notion that success is the product of disciplined practice – not an uncontainable natural genius. I realized this simple principle after reading Talent is Overrated by Geoff Colvin. The examples of the work ethic in Mozart and Michael Jordan were very inspiring. They were not born with their amazing abilities; they were driven to the point where they wanted to practice music and basketball all day long, every single day. It was only after long periods of deliberate practice that they became incredibly skilled.
In his book, Outliers, Malcom Gladwell writes about the 10,000 Rule. He explains that it takes 10,000 hours to become an expert in a given field, to actually master the subject.
One of my favorite examples is that of legendary slugger Ted Williams. He is believed to be the most gifted hitter of his era (the last man to hit over .400). Hall of Famer Bobby Doerr said, ”Ted just had that natural ability." It was also said that Ted had laser-like eyesight, which allowed him to decipher the spin of a ball as it left the pitcher's fingers. Ty Cobb once said, "Ted Williams sees more of the ball than any man alive." I even heard Ted Williams could leap tall buildings in a single step! Sounds like some guys are just born with it, right?
Wrong, scientific tests showed Ted’s eyesight to be well within ordinary human range. The true story of Ted Williams’ talent was nothing more than a phantasmagorical work ethic that began when he was five years old and continued until he retired from the game. He grew up poor, yet paid his friends to shag balls. He denied entertainment, social activities, and other sports to focus on baseball. As a rookie, he practiced long after practice was over, he hit balls until they disintegrated, and swung bats until they splintered.
Drive is an acquired trait. Talent is a process, not a natural gift.
What are you passionate about?
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