May 22, 2007
Be the Elephant: Build a Bigger, Better Business
This excerpt is taken from the Preface of Be the Elephant: Build a Bigger, Better Business by Steve Kaplan.
Kalplan combines dynamic advice, real-life experience, and a friendly, no-nonsense writing style to take the mystery and fear out of achieving significant business growth. He gets readers to understand the exact nature of their business by showing how to define objectives, identify risks, and get the operation on solid footing.
Preface
It's Great to Be Gray
Who Are You?
- You're the owner of an e-commerce business. You've made it over the second-year hump and are poised to break out, but you're unsure about which strategy is best to grow your business. You don't have a ton of money, so you need to make the right growth decision the first time. One misstep will kill your momentum.
- You run a three-person gourmet cookie company with a few corporate customers that take up most of your time. With such a small customer and employee base, you're understandably nervous. You know that you need to grow, but how to start the process without upending your existing business? Implementing a growth strategy might upset your large customers, prompting them to move along to that next cookie. And you do not want to be left with crumbs.
- You're a sales professional, selling mortgages. You're doing pretty well and have great relationships with many of your clients. You know that if you had more things to sell them, it would be a cakewalk, but you're not sure how to develop new offerings, especially ones they will prepay for.
- You're the senior partner in a CPA firm. You've always been motivated by a desire to become the best CPA you can be. You want your work to matter, to be recognized for its quality and superiority. You're great at your job, but you've neglected the business end of your business, and your client base is shrinking. Now you see the need to grow, but the resources available to you don't offer an obvious path to growth.
- You own a $50 million consulting business. You've been cruising along, selling the same service for years. A few years back, you tried expanding your services into new markets, but the extra duties and responsibilities took your employees' attention away from your core clientele and the effort failed, almost costing you your business. You're doing okay now, but you don't want to work like a dog forever.
- You're a partner in a marketing firm that's been doing steady business for a few years. You're not growing, but that's all right, because you don't want the worries of a larger business. Besides, you wouldn't know what to do to get bigger. You're okay with the status quo for now. Yet you can't help being a little worried, because you've seen many other businesses like yours cruise along at treetop level for years and then crash and burn. All it took was a brief financial stumble, and the owners were unable to adapt or compensate.
Not-Growing Pains
If you can identify with any of these people, this book's for you. You realize that your business is living pretty close to the edge. You don't have much flexibility or reserve. Yes, you may be spared the giant problems of giant companies, but the anxieties and stresses of eking out profits and growth in your business, at its current size, are hardly a blessing. You're worried about Incredible Shrinking Business Syndrome. You also fret that you'll never make the big bucks you've dreamed of. But just thinking about growing gives you the jitters. Rock and a hard place.
Somewhere in the back of your mind, you remember what older, wiser capitalists have told you: In business, there's no standing still. Avoiding growth goes against the laws of nature; you're either growing or dying, yet finding a niche and managing to operate there happily ever after is riddled with risk. A recession, a new technology, even a miscalculation or a sudden illness can lead to a quick demise.
Okay, so “slow and steady� isn't as good a long-term growth strategy as you thought. You can see that a larger, broader-based business would give you more security in the long run, and that's your ultimate goal. And, hey, when you think about it, you actually enjoy the challenge of expanding a business, upping the ante, looking for the next big thing, and making a pile of money along the way. For you, there's nothing like the sheer joy of stomping on the gas and feeling your business lay a little rubber.
And when you really think about it, when you're really honest with yourself, most of you (including me) have to admit that you want to be big. You'd like to be out in front of the pack, with all the money, power, and recognition that goes with the lead. You itch to be rich and have the freedom to do what you want--and this small business isn't doing it for you.
If you were content, you wouldn't be reading this book. Like most business owners, you want to grow. How fortunate--because you're the person I wrote this book for.
As Big as You Like
Almost every business I come across has the potential
for substantial growth; most of their operators just don't know how to get there. A few owners are most comfortable with an operation in which they know all their employees, the financial winds are light to moderate, and they can take the family on vacation for a few weeks and not worry about what Warren Buffett thinks. But the vast majority want to look in the mirror and see an Elephant.
Well, yes, you think, of course I want my business to grow, but, come on, will I ever be Wal-Mart or Microsoft? Probably not, so why should I try to become the Elephant? The odds of that are about the same as my chances of opening a scuba shop on the moon.
You're forgetting that Elephants come in different sizes, but all Elephants have a few things in common: They're all companies big enough to make a difference, healthy enough to withstand strong financial winds, and strong enough to influence their market, whatever that market might be.
When you're an Elephant, you have power, wisdom, and respect.
Becoming an Elephant means growing your company to a size that's as big as you want. For some--me, for example--the goal is to be huge. For others, medium size is more comfortable; for still others, being a small Elephant is just fine.
Even if you genuinely wish to stay small, you need to become the Elephant in your neighborhood. If you don't, the fickle marketplace may assign that title to one of your competitors--and no one likes living under the feet of an Elephant.
In short, you can be an Elephant--and reap Elephant benefits--without being in the Fortune 500.
Whatever size Elephant you are, you will have built-in cash reserves and access to resources that, as a smaller company, you cannot expect to enjoy. You will have more employees, but they will make your life easier by providing you (and themselves) greater job security. You might have more day-to-day problems, but you'll have more people to handle them for you, more revenue to pay for processes and assistance. And if you hire wisely and organize well, you will have more days to spend sailing. What sort of elephant are you?
Why Did I Write This Book?
When I set out to put these ideas on paper, I had one goal in mind: to create the playbook that I wish I had had when I was building my businesses, a voice of experience to tell me what works and what doesn't in a no-BS style. Since those early years, I've had the advantage of spending a lot of time with successful business owners and applying my ideas successfully to scores of businesses, and I've found that the strategies and principles I discuss here work, not only in
the United States, but everywhere.
Be the Elephant is the second book in a series aimed at helping solve the real issues faced by business owners, professionals, sales professionals, managers--anyone charged with growing any part of a business. The central idea of the first book, Bag the Elephant, was to provide a strategy for getting and keeping that huge customer. The book you're holding now focuses on a process and strategy you can implement to grow your business safely and efficiently--and become the Elephant yourself.
What Are You Worried About?
Growing a business is not easy. I should know--I've done it countless times. I've had some failures, but many successes to more than make up for them. Knowing when and how to grow effectively while keeping your eye on the current business is always a challenge.
You probably are asking yourself the same questions I've had to ask myself many, many times in the past:
- Should I be selling new things to the same customers? Or the same things to new customers?
- Should I be looking at a geographical expansion?
- When is the best time to expand?
- How can I make sure that my business is on solid footing and can handle the growth?
- How can I get a customer to fund my growth?
- How can I identify and mitigate the killer mistakes that can bury my company?
- What about risk?
- What about my employees? Will I alienate the others if I promote one or two to run the new venture?
- How will my current customers feel about my business expansion? Will they worry that I won't have time for them?
- What if it doesn't work? What then?
This book addresses all of these issues and more. I've spent the last five years designing and refining this strategy and have successfully applied it to the thirty-plus businesses I've owned or designed strategies for and the hundred-plus for which I've consulted in the United States, Europe, and Asia.
How to Use This Book
Read the whole thing. It's not that long. I've written it in clear, concise language. Don't just jump ahead to the growth strategy without reading and understanding the material on getting your business in shape; you need the whole package, starting with a solid foundation, in order to achieve lasting growth. If your business isn't on solid footing, then growth may simply bring about collapse.
Pass it on to everyone in your company charged with new-business development or growing even a piece of the business. Make sure all your salespeople read it so they can expand the business they do, and yours in the bargain. It's a great motivational tool, and it will help them reach their full potential.
Include your team. It's vital that your vision is shared with your whole team, whether you have one or one thousand employees. Nurturing the proper growth culture is paramount to success.
Be advised: I'm not promoting some get-rich-quick thing here. This is hard work. You'll have to buckle down and get ready to hear how it really is, in plain talk. Business clichés are a waste of time and I don't believe in varnishing the truth. I like to roll up my sleeves and dig in. If you're ready to do the same, then join me. If not, pass this book along to someone who can use it.
All My Children
The process of making a business successful has always fascinated me, and success, to me, means growth--big growth. I like to take small but promising businesses and turn them into big, healthy businesses. I like to create jobs, develop products, services, and people, and enhance commerce in its truest form. I marvel at how a capable businessperson can create solid value out of the thin air of ideas and ambitions. On the other hand, I'm also astounded at how seemingly smart people can work very hard on businesses that, because of a flawed business model, have no chance of success.
I've owned and run many businesses, and I've come to think of them as my children. Like an infant, a startup business is helpless, dependent entirely upon the parent. The child needs values, attention, love, and security. It needs someone to show it the way. Success means turning that infant into a healthy and productive adult that can stand on its own and command admiration and respect.
Between infancy and adulthood lies a vast field of challenges and options. As parents raising children and making crucial decisions, we often find our hearts leading one way and our minds another. Choose unwisely, and the process will fail, usually in a costly, painful way. Choose well, and you will be rewarded handsomely.
Wake up. Stand up. Look around you. See all the Elephants?
It's time to Be the Elephant.
Posted by Rebecca at May 22, 2007 9:40 AM | TrackBack