First, don’t make your business about money. You and your team will not be inspired. Focus on a purpose and a mission. A lot of business owners and executives make the mistake of thinking that staff are motivated mainly by money. All the research proves otherwise. My approach is to pay staff what they are worth but don’t use sticks and carrots to motivate them. Since the GFC people want to be motivated by the mission more than anything. So put purpose before profit.
Wharton Business School published a book called “Firms of Endearment” which shows businesses that are focused on a purpose ironically made the most profit. They outperformed the S & P 500 by a ratio of 9 to 1 over a 10-year period.
Second, look after your staff BUT do not accept mediocrity. Expect and demand excellence.
Third, hire people that can work on parts of your business you’re not good at. Stick to what you’re good at.
Fourth, accept that you are not perfect. Keep learning to master your craft. Attend training seminars as much as you can. Get a business coach and mentor. Make sure it is someone with a little grey hair. In business, experience is everything.
Fifth, start a rainy day fund in case things go wrong. Economy, poor health or whatever. This takes the pressure off and you start working for love and not money. Work becomes a sport. You start to play with confidence and not fear.
Sixth, do NOT diversify into areas of no competence. I meet many people who make money and instead of re-investing it in their own business they go into other areas. I knew a guy who was a very successful mortgage broker. He made a lot of money but instead of investing it back into his own business, by say, hiring more staff or opening a shop front, he opened a café. He lost a lot of money and took his eyes of his own business. So, stick to what you know.
Seventh, work harder not just smarter. I do not believe in or adhere to the 4-hour workweek. I appreciate Tim Ferris and his adventurous spirit but the constant focus on making a quick dollar is what’s wrong with Western Economies. We do not lack intelligence. We lack a strong work ethic. We constantly focus on making money quickly instead of working hard daily. Building a business is brick-by-brick, day-by-day, there’s no easier way.
Eighth, stay focused on the micro. Ignore what is happening at the macro level. We cannot control that. So don’t be obsessed with the business news. It makes you fearful and you start to work defensively and out of fear. Business is like sport. If we start playing defensively we stop scoring and eventually we lose the game.
There are a lot of businesses that made it through the GFC stronger and bigger and more confident. It’s because they focused on what they could control. If you have a good brand and good product then all you have to do is to stay focused on delivering to your customers. Look at APPLE!
Next week I will share with you the secret 9th and most important reason why some businesses are outperforming their competitors.