Entrepreneurial Thinking: Achieve High Levels Of Financial Success
Be true to the best you know. This is your high ideal. If you do your best, you cannot do more. — H. W. DRESSER
All people want to achieve the highest possible level of financial success in the course of their careers. According to Thomas Stanley, author of The Millionaire Next Door, fully 80 percent of self-made millionaires are entrepreneurs. They earned their fortunes in one lifetime by starting and
building their own business, by producing and selling something to someone. They thought and acted like entrepreneurs most of the time.
According to the April 2024 Forbes magazine, there are 2,781 billionaires in the world today, 70 percent of whom are self-made. They started as entrepreneurs with nothing and built their fortunes from the ground up by creating and selling products and services that people wanted and were willing to buy and pay for.
Think About Customers
Entrepreneurial thinking means focusing on the customers at all times, thinking about the customers continually.
Tom Peters wrote in the book In Search of Excellence that the single most important quality of successful businesses was “an obsession with customer service.”
Corporate Thinking
Corporate thinking is different from entrepreneurial thinking. Company people, whether employees, managers, executives, or technicians, view customers either with disinterest or as problems who are always complaining or requesting something new or different. Customers are
often seen as flies that have to be swatted and brushed away.
Corporate thinkers are preoccupied with doing their jobs, pleasing their superiors, following the rules, and doing the minimum necessary to avoid being fired or laid off. Employees who are corporate types use the pronouns “them, they, and their” to describe the company and the people in charge.
They feel that whatever happens in the company has little to do with them personally. They say, “A job is a job.” As one corporate type told me some time ago, “When I go to work, I think about my job, but when I come home, I don’t think about my job or company at all.”
Lack of Engagement
Many researchers conclude that more than 60 percent of employees at large and small companies are “disengaged.” They feel no deep commitment or loyalty to the company. They are just going through the motions of work, thinking about doing something else. They check the jobs ads on a regular basis, post their résumés and qualifications on LinkedIn and other websites, and are continually looking for something else to do.
Corporate types come to work at the last minute, take every minute of tea breaks and lunches, and spend as much as 50 percent of their time chitchatting with co-workers, checking social media on their smart phones and doing things of no or low value to their company.
Commitment Is the Key
Entrepreneurial thinkers are different. They are committed to the success of the company. They see themselves as self-employed and act as if they owned their companies personally.
They use words like “we,” “mine,” and “our” when they refer to their company and to their products and services. Above all, they accept and take on high levels of responsibility for results.
Entrepreneurial thinkers are always volunteering for more responsibility. They continually think about making a greater contribution. They are continually upgrading their skills, learning new things, and seeking ways to become more valuable to their companies.
Above all, entrepreneurial thinkers search for ways to increase the sales and profitability of their companies.
Entrepreneurial thinking is customer-centric, customer-focused thinking. Entrepreneurial thinkers think about customers all the time.
Sales Are Central
The number one reason for business success is high sales. The number one reason for business failure is low sales. All else is commentary.
The key to business success is SMS, which stands for “Sell More Stuff.” This is what the entrepreneurial thinker focuses on most of the time. How can we sell more stuff?
Successful business people have certain qualities, characteristics, and disciplines that enable them to achieve far more than the average person.
There are several ways for you to develop the qualities of entrepreneurial thinking and to make a greater contribution to the sales and profitability of your organization. Remember the three keys: clarity, focus, and concentration.
Ask the Basic Questions
There are basic business questions that you need to ask and answer all the time, especially when you face rapid change in knowledge, technology, and competition.
First, what business are you really in? Define your business in terms of how you serve your customers, the improvements or transformations your products bring about in their lives and work.
Who is your ideal customer, the perfect person for what you sell? This is a description of the demographics and psychographics of the type of person who most appreciates and values the special features, benefits, and results of the product or service that you offer. What does your ideal customer consider valuable? What is so important to him or her that you can provide that makes your prices seem unimportant?
The main reason that businesses fail is that there is little or no demand for their product. People don’t value it or want it and have no interest in buying it.
Your Area of Excellence
What is it that you do especially well? What is your area of excellence or superiority in comparison to your competitors relative to what your ideal customer wants, needs, and is willing to pay for?
All companies, products, and services must have a competitive, comparative advantage over their competitors that makes them the best choice and ideally the “only” choice in their market. What is yours? What could it be?
Jack Welch said, “If you don’t have competitive advantage, don’t compete.” He is famous for his rule that General Electric would be number one or number two in every market it was in, or it would abandon that market and concentrate its efforts somewhere else.
For a company to be successful, it must dominate a market niche. In at least one area, it must be recognized by customers in the marketplace as being “the best” for that particular customer.
In what areas do you or could you dominate your market? What would you have to do more or less of? What would you have to start or stop doing altogether?
Peter Drucker, an adviser to Jack Welch, said, “If you don’t have a clear competitive advantage, develop one.”
Entrepreneurial thinking at its core is focused on developing and maintaining a meaningful competitive advantage in competitive markets.
Your Business Model
Today, the entrepreneurial focus is more and more on the business model, the complex strategy that your company uses to produce, sell, and deliver your product or service to more and more customers in a profitable and cost-effective way. What is yours?
According to Geoffrey Colvin of Fortune magazine, many if not most companies are operating on an old business model, one that is partially or totally obsolete.
How do you know if you have the correct business model for your business? The easiest measure is that your sales and profitability are increasing steadily and predictably.
If your sales are erratic or inconsistent, have levelled off, or, even worse, are declining, it could be that your business model no longer works. If this is the case, and you do not change your business model, the end is in sight.
Thinking About Your Business
Entrepreneurial thinking requires that you continually review and evaluate the essential elements of your business model.
1. What value does your product offer? What job does your product do for your customer? What problem does it solve? What benefits does it deliver? What pain does it take away? What goals does it enable your customers to achieve? And especially, how important are your key benefits to your customers? Your ability to ask and answer these questions accurately will largely determine the future of your business.
2. Who is your customer? Who are the customers who can most benefit from the products or services you offer? What are their demographics? What are their ages, incomes, education levels, genders, occupations, and type of family formation? What are their psychographics? What are their hopes, dreams, fears, ambitions, and aspirations relative to what you sell? Especially, what are their ethnographics? How do they use your product or service? What role does it play in their lives or work? How important is it to them in comparison with other things?
3. What are the most effective ways that you can market (attract new customers), sell (convert them into buyers), and distribute (get your product into the hands of your customers)? How could you attract more and better-paying customers? How could you sell faster and more effectively to the prospects you attract? How could you distribute your product faster and more efficiently? (Think Amazon.com!) The rule is that whatever you are doing today, you will have to be much, much better a year from now just to stay even in your current market.
4. How do you give such good customer service that your happy customers buy from you again and again and tell others to buy from you as well?
5. What is the cost structure of your business, and how could you change it to achieve greater profitability? How could you outsource, downsize, or eliminate certain activities so that you can offer the same high level of quality but at a lower cost of operations?
Continue to Question
Entrepreneurs in all types of businesses think about these critical factors all the time. They are always willing to consider the possibility that they could be wrong or that there are better ways to get results in one or more of these areas.
Entrepreneurs practice zero-based thinking continually in every area. They ask, “Is there anything that we are doing that, knowing what we now know, we wouldn’t get into or start up today?”
Entrepreneurs are more concerned with what’s right rather than with who’s right. They keep their egos out of the discussion.
Entrepreneurs are willing to admit, “I could be wrong.”
Entrepreneurs openly admit, “I made a mistake,” and then they get busy correcting the mistake as quickly as possible, rather than trying to bluff, bluster, stonewall, or hope that it will go away.
With new information, entrepreneurs readily say, “I’ve changed my mind.” They quickly embrace new ideas and methods to get better results, no matter the source.
Customer Focus
Entrepreneurial thinking requires that you think about the customer all the time. You continually seek new, different, better, faster, and cheaper ways to serve customers and give them more and more of what they really want and need.
Your ability to think like an entrepreneur rather than an employee will do more to liberate your full potential in your career than any other single factor. It might even make you rich.
Action Exercises
1. Define your perfect customer clearly. How could you serve him or her better than your competitors?
2. Determine your value offering, the one or two qualities of your products or services that make them superior to those of your competitors.
3. Examine your business model to be sure that the way you are generating sales and profitability today is the best and most efficient way to do it.