Escaping the “Self-Employment Trap”

Many entrepreneurs, write the authors of Scale: Seven Proven Principles to Grow Your Business and Get Your Life Back, don’t know the difference between growing a business and “growing a job.” A job is the responsibility of one person. In contrast, a business functions through a number of individuals in key roles, each with their own sets of responsibilities. In other words, authors Jeff Hoffman and David Finkel write, if as an entrepreneur you are working 70 hours a week because you alone are still responsible for the four core systems of your business finding prospects, closing sales, producing and delivering the product, and collecting on what you are owed you haven’t built a business, you’ve built a job. And sustaining such a job is not possible unless you sacrifice other aspects of your life.

The Self-Employment Trap

In Scale, Hoffman and Finkel lay out seven principles to help entrepreneurs escape the trap of every aspect of the business moving through them — what they call “the self-employment trap.” The first principle is understanding the concept of building a business, not a job. To clearly lay out the difference, they offer a business growth model based on three levels:

Level One is the preparation for launching the business and includes the business plan and making sure the business is viable.

Level Two Early Stage is getting the business off the ground. This is when you start to build a customer base and reach profitability.

Level Two Middle Stage is when you escape the self-employment trap by starting to build out the four core systems described above. Level Two Advanced Stage is when you’ve established a management team, and the systems keep the company running.

Level Three is the exit stage: As an owner-entrepreneur, you can sell the business or be a passive (and proud) owner of the business you launched from scratch.

Many entrepreneurs stay stuck in Level Two Middle Stage because they are focused on operating the business — selling to prospects and delivering the product — and are not taking the time to build a base that will allow others to take over “the job” they are now doing alone. The remaining principles in Scale are intended to help entrepreneurs break out of Level Two Middle Stage.

Through principles two and three, entrepreneurs learn to build a solid foundation for future growth. Principle two covers systems and controls for the business, while principle three offers tools to clarify the market and identify competitors.

Principle four, “Create the Right Strategic Plan,” helps entrepreneurs to do their homework so they can pick the best strategy for their company.  Principle five — “Learn to Read the World So You Build Tomorrow’s Marketplace,” is focused on keeping the company up to date.

In principle six, “Overcome the Predictable Obstacles to Scaling, Pillar by Pillar,” the authors show how to scale the sales and marketing, operations, finance, team and executive leadership pillars of the business.

The final principle is “You Do Have Time to Scale Your Company.” The authors offer a “time mastery system” that will refocus time and effort on tasks and responsibility of true value — and eliminate the work that you should not be doing in the first place.

Hoffman, a former CEO in the Priceline.com family of companies, and Finkel, a successful business coach, have written a practical guide filled with tools and methodologies — many available online — that will help many entrepreneurs finally break free of the exhausting and frustrating self-employment trap.

Book Review: Overfished Ocean Strategy

Overfished_Ocean_Strategy

by Nadya Zhexembayeva

When resources are depleting rapidly and the cost of raw materials is increasing dramatically, businesses need to make resource scarcity their top strategic consideration. In Overfished Ocean Strategy, Nadya Zhexembayeva shows how businesses can find new opportunities in what were once considered useless by-products and develop ways to rapidly refine these new business models. This book is now available as a Soundview Executive Book Summary.

“The transformation brings about a new economic reality, where we compete and win using a radically new set of rules. While the companies, people and projects pioneering these new rules are still rare, there are enough of them to suggest the first few essential principles that allow managers to innovate their way into a new world,” writes Zhexembayeva. She offers five essential principles that define the Overfished Ocean Strategy to power up a new and different strategic direction to increase sustainability within your organization. The first principle is “From Line to Circle,” explains to leaders the global value chain of goods and service can be transformed into a circle, where the waste of one process can fuel another. This principle along with the other four will shift your business from stale to fresh.

Additionally, Zhexembayeva presents several examples of how companies across the globe are implementing this strategy effectively, including Walmart and Shell. With Overfished Ocean Strategy, leaders and managers around the world will be able to inspire radical change and drive disruptive innovation within their organizations.

Thinking, Fast and Slow

A MIND-BENDING APPROACH TO THOUGHT

What is 2+2? The answer that comes immediately to mind is, of course, 4. What is 17 x 24? We can arrive at the answer, but only after a little work. In our minds, writes psychologist and former Princeton University professor Daniel Kahneman in Thinking, Fast and Slow, there are always two systems at work. System 1 is an intuitive-based “automatic” system that can be summarized as fast thinking. System 2 is an “effortful” system — a slow-thinking system that requires an effort (and some time) for us to arrive at the answer.

While these two systems would seem to be well-designed for dealing with the world, in truth, writes Kahneman, the systems create some problems. The reason is that system 1 kicks in when system 2 is more appropriate — or, to put it another way, our trusted intuition can lead us to the wrong answers and the wrong conclusions.

What’s So Bad About Our Minds?

Steve is mild-mannered and detail-oriented. Is Steve more likely a librarian or a farmer? Most people would answer librarian, and they would be wrong. The mistake, as Kahneman explains, comes from the caricature of a male librarian (mild and detail-oriented) that we carry in our minds. In truth, as there are a far greater number of men who are farmers, there are more mild-mannered Steves on tractors than behind circulation desks.

Our biases and “heuristics” — the technical term for “rules of thumb” — can cause us to jump to conclusions, right or wrong. “Librarians are mild-mannered” is a heuristic and leads us to the wrong answer. System 2 thinking will be more accurate in many situations, but as Kahneman notes, we think slowly when we are stumped and don’t have a fast answer to jump to — such as when faced with the problem 17 x 24. When an answer easily presents itself to us (“Steve is more likely a librarian”), we rarely take the time to second-guess our intuition. Thus, we make erroneous decisions and draw erroneous conclusions based on shortcuts we didn’t even realize existed.

For example, Kahneman writes, most people believe they have an informed, objective opinion about which are the most important issues facing their nation. In truth, research has shown that people decide which issues are most important based on media coverage. The reason is the “availability heuristic” — the rule of thumb that people attach importance to events that are easily retrieved from memory, in other words, readily available (rather than buried in distant memory). How do those events become available? The answer, of course, is media coverage.

Priming is another phenomenon that can affect our decisions without our knowledge. A person who’s recently heard the word “food,” for example, will be “primed” to complete the word SO_P as SOUP and not SOAP. Priming is the reason that ballot questions concerning funding for education get far more support from people who vote in polling stations located in schools.

The Marvels of the Mind

Of course, fast thinking is not always wrong — and in many cases it’s necessary. As Kahneman explains, recent developments in cognitive and social psychology have also revealed the marvels of intuitive thinking. Kahneman is not arguing that we are making wrong decisions consistently, only that we are far less rational than we believe ourselves to be.

Thinking, Fast and Slow will have readers looking at the world around them, and at their own decisions and opinions, much differently. This is not a fast book to read, however — nor should it be. There is too much to be savored.

Amp Up You Sales

In the current competitive and economic market, selling has become more challenging than ever. Customers are overloaded with information, overwhelmed by options, and short on time–so the salesperson who is always responsive and completely focused on value, is the one who will stand out from the crowd and get the sale.

Andy Paul, author of Amp Up Your Sales, shows anyone how to become the trusted sales professional who consistently wins new business. In our upcoming Soundview Live webinar Andy will help you:

• Move Customers to Make Fast& Favorable Decisions
• Deliver the Maximum Value on Each Sales Touch
• Rapidly Build Trust and Credibility
• Protect & Improve Your Profit Margins
• Provide Compelling Reasons to Buy From You
• Compress Buying Cycles with Responsiveness
• Be Clearly Differentiated From Competitors
• Earn More Selling Time With Your Customers

Join us on November 11th for our webinar of the same name, Amp Up Your Sales, and learn how to be the trusted sales professional for your customers.

Book Review: How the World Sees You

How_the_World_Sees_You

by Sally Hogshead

In the professional world, you need to set yourself apart from the crowd to make a great first impression. You already know how you see yourself. However, do you know how the world sees you? According to Sally Hogshead in How the World Sees You, once you know what makes you valuable to others, you are more able to make a positive impression. Hogshead presents a systematic method to describe yourself in just two or three words. Readers will gain why it is necessary to know their highest value and how to discover it. This book is now available as a Soundview Executive Book Summary.

“As conversations become more compressed and the marketplace more crowded, you need to know how others see you and respond to you. Rather than just knowing your strengths, you need to know your differences,” writes Hogshead. She explains there are seven Fascination Advantages to communicate successfully. Each Advantage has a different approach to fascinating others and building relationships. Knowing your primary Advantage will help you intentionally apply it to communicate more effectively. Once you can tap into your Advantage, you’ll become more valuable to colleagues and/or clients leading to more success.

Beyond finding out what your advantage is, you will also learn how to construct your Anthem. Your Anthem is the tagline for your personality to use as your mission statement or to captivate your audience. Much like a company’s tagline, your Anthem will tell others what makes you unique from others. With How the World Sees You, professionals at every level will increase their ability to communicate messages and develop relationships effectively and confidently.