Work Matters

Last week I made mention of my three, main business gurus. To my way of thinking, an entrepreneur would be well advised to listen to all three of those gentlemen.

One person I did not mention, but whom I am quite fond of, is Tom Peters. Peters wrote one of the most seminal business books titled In Search of Excellence. As such, my fondness for Tom is not limited to the fact that we happen to share the same birthday.

Peters has been around for a long time and is known for many things. I once heard somebody say Tom is passionate about passion. A good example would be the comic strip Dilbert.

If you are not aware, Dilbert is a comic strip, created by Scott Adams, which pokes fun at work life. Dilbert is generally pretty innocent, but Peters feels the comic illustrates a cynicism towards work.

Let's face it, work makes up a major part of our life. Statistically, it bids for the top spot on any time-audit. To quote a famous Peters refrain, "Work matters."

I am onboard with Peters. Rather than mock our work, we should aspire towards optimism and engagement. But, I am probably preaching to the choir. A big part of the reason to become an entrepreneur is to avoid the cynicism of organizational life.

So, let me tell you something else Peters said. He said, "I have learned only three things in forty years. One, he or she who has the best relationships takes home the prize. Two, all effective leaders are full-time salespeople. And, three, he-she who tries the most stuff wins; action beats talk ten time out of ten."

This quote is probably more important than work matters. In accord with Peters's third point, entrepreneurship is about a life of action. As I have said before, experimentation is critically important.

Another important point is the centrality of selling. A business exists for one reason. And, there are two main functions: innovation and sales.

While you are taking action, experimenting, and iterating like crazy, do not forget to build and nurture relationships. Because we cannot do it alone.

My three main business gurus

A real challenge of modern life is the paradox of choice. With so many gurus out there, it is easy to get lost.

Unfortunately, I do not necessarily have any shortcuts for you. Perhaps you have been paying attention to me for a while. If you like the way I think, I recommend sticking with me.

The way I resolved the paradox of choice was by reading everything I could get my hands on. Over time, I have been able to identify who keeps it real, and who is full of hot air.

This leads me to my first guru: Peter Drucker

If you make any real effort to study business, you will discover that all roads eventually lead to Mr. Drucker. And, if you are familiar with my blog, you know I talk a ton about Drucker.

Let me give you a little example. James O'Toole is a professor at the University of Denver Daniel's College of Business. And he once said, "It is frustratingly difficult to cite a significant modern management concept that was not first articulated, if not invented, by Drucker."

Not that the order matters, but, my second guru is Warren Buffett

Last week I talked about the original definition of the word entrepreneur. And, according to that definition, Buffett is the greatest entrepreneur of all time.

Think about it. To remind you, JB Say originally said, "The entrepreneur shifts economic resources out of an area of lower and into an area of higher productivity and yield."

On May 1, 1956 Warren started Buffett Associates, a limited partnership of seven people, who collectively invested just over $100,000. Buffett himself only invested $100.

From that rather humble beginning, Buffett would become the richest person in the world. And, he did it all by shifting economic resources out of areas of lower and into areas of higher productivity and yield.

I listen to everything the man has to say.

Last and possibly least: Neil Rackham

As Drucker would say, a business exists for one reason: to create a customer. Thus, the two main functions of business are innovation and marketing.

Business can be boiled down to simple basics. Business is, very simply, an exchange of value. Innovation is the value part. And marketing creates the exchange. Without getting into too deep of a discussion, I am going to say sales instead of marketing.

Back in the 1980's, Rackham permanently changed the sales landscape. He did a ton of research with the intent of finding out what made the best salespeople so good.

Ultimately, what Rackham did was he took sales and turned the focus onto the buyer and the buyer's decision-making journey. This might seem obvious. But, trust me when I say it is not.

Most salespeople (and all entrepreneurs are salespeople) have no idea how to increase their effectiveness. Their actions prove that they really do not know how buyers make decisions.

Rackham is best known for his book SPIN Selling. If you have yet to read it, you really need to. And, if you want to truly understand the genius of Rackham, read his book Rethinking the Sales Force.

Entrepreneur

Last week I spoke about entrepreneurship being about education. And, it is a true statement. A large part of entrepreneurship is the education which facilitates an exchange of value. Aka selling stuff.

Admittedly, this is a newer conception of the word entrepreneur. The term "entrepreneur" was originally coined, around 1800, by French economist Jean-Bastiste Say.

JB Say originally gave the following definition, “The entrepreneur shifts economic resources out of an area of lower and into an area of higher productivity and greater yield.”

Nowadays the word entrepreneur has morphed into numerous meanings. Many of which I support. However, I feel it wise to always remember the original meaning of the word.

Entrepreneurship is the essence of economic activity. Indeed, it is the essence of life. Because life and business are critically dependent on the allocation of scarce resources.

I know that sounds pretty dry, but it is important. It is so common for people to keep adding servings to their plate. Meaning, we keep taking on more and more stuff, to do or to think about.

The trouble we run into is the fact that mental energy is a limited resource. And, if you understand the nature of humans, and resource allocation, you understand that deciding what to ignore, deciding what not to do, is usually the hard part.

Additionally, we need to know what our resources are. Meaning, we need to know our strengths. Click here to go to an old post which contains an excellent strengths test.

Back in the 19th Century, like most economists, JB Say was talking about resources. Today we live in the information age, where knowledge is one of the key resources. 

Today, our main resources reside between our two ears. These resources are: attention, knowledge, style, and strengths.

If we wish to allocate our resources, we had better know what they are!

Entrepreneurship is Education

Entrepreneurs innovate. It is one of the main things we do.

This truth has many implications.

One of implications is that we are breaking from the status quo.

This can be difficult, because people resist change.

Another implication is that your customers need to be educated.

Any true innovation is a break with the past. A break with the old way of doing things.

This requires that your customers be educated about the new possibilities.

The readers of this blog will have various and sundry products.

So, I cannot tailor everyone's education process.

Some innovations can make sense from the instructions on the product's packaging.

Other innovations might benefit from the educational platform known as an "infomercial."

While some innovations require a sales force to go out and educate the customer.  Eyeball to eyeball or ear bud to ear bud.

As an entrepreneur, it is your job to figure out the best way to educate your prospective customers.

This is one of the main hurdles to Commercializing Creativity.

Make it happen!

Artificial Intelligence

There is a lot of talk these days about artificial intelligence. It certainly is interesting.

A few weeks ago I predicted that China will not overtake America any time soon (click here) Allow me to make another predication. Artificial intelligence will not replace humans any time soon.

Sure, AI will replace some human activities. But, a big advantage of the human mind is its ability to perceive the world around it.

Computers are great at logic. Humans are great at perception.

And, when it comes to business, and entrepreneurship, perception is much more important than logic.

Sometimes it sure would be nice if a computer could do the hard thinking for us. It cannot. And, I am pretty comfortable saying computers will never be able to replace our job of perceiving the outside world. At least not in our lifetimes.

P.S. I am well aware of the commercials IBM is running about "Watson." I am also aware that Watson won at Jeopardy.

But, think about it. Jeopardy is about the past and business is about the future. And, when it comes to dealing with the future, humans are still way better than bots.

P.P.S. I know artificial intelligence has a lot of futuristic appeal. Sorry to rain to sexy parade...but, I roll with humans.