Business Strategy

Beer, Taxes and the Basics

A great blog entry this morning comes from John Locke “On Taxes and Barstool Economics.”  In the article, he reports a story that describes economics in terms of 10 men sitting at a bar drinking, and the breakdowns in the theory.

I find it interesting that when we think about taxes and responsibility, we think about it in different terms than when we think of individual people and responsibility. It is normally the case that those who have demonstrated the greatest ability have managed the greatest responsibility. Our entire system of government, business, and rearing our families is based on this concept. Why should taxes be any different?

I think that part of the problem is that we have become to individualistic and opportunistic. America was built on communities and a sense of togetherness. Now we live in an age of super-competitiveness, where people are out for themselves and what they can amass, completely unaware that the sun shines on all of us.clip_image002[4]

We, as a country, need to go back to basics…we need to look at things that we can do something about. We need to hold people accountable for their theft and indiscretions. We need to address issues of education and poverty, transportation, economics, businesses and work. We need to address the goals and purpose of our government. We have crossed so many lines between right and wrong that the legal system is beginning to look murky at best.

Consider, for a moment…what would happen if our taxes went up 1%-2%? What would happen if they went down 1% – 2%? What about 5%?

The question should be: what is going to happen with my tax dollars? If I am going to bail out a company or companies that made bad decisions and caused me and my country pain and suffering, I don’t want any part of it. I would rather keep my money and spend it where I choose.

If it is going to be invested in our infrastructure so that we are not so dependant on fossil fuels or going into our health system so hospitals don’t have to charge $3,300 for an emergency room visit

Consider this: By keeping the best schools exclusive to the highest-tax grossing neighborhoods, we perpetuate the problem of under education, poverty and at-risk communities.

By dumping all of our money and resources into the largest companies who have the greatest resources and responsibility, and treating small businesses as though they are to be tolerated, we cut the legs out from underneath our societies. While there are many small businesses that go out of business, there are many that do well, and get sold to larger businesses or become larger businesses.

It’s ironic how when someone speaks for truth and addressing the needs of the group, versus the needs of the individual or exclusive individuals, he is labeled. I think that sometimes, we ask that people address a scratch on the bumper when the whole car is wrecked.

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Small Business Futurama

There used to be a display at the New York City Worlds Fair called Futurama.  It was a very cool display of what the world would look like years and year down the road.  It presented details such as future homes, cars, cities, transportation systems, etc., and did a pretty good job.  The video, below, covers the 1939-1940 display of what 1960 would look like.

The folks at GM were thinking about what the future will look like.  Ever consider why?  Ever consider why Disney spent so much time and money creating “The World of Tomorrow” display?

One major reason was to create hope.  They were trying to give Americans and the rest of the world something exciting to look forward to.

Inspiration.  By creating this vision of the future, they helped to encourage inventors and engineers to create what might be.

Marketing.  They wanted people to know that they were thinking about the future, and their place in it.

Just like them, in your small business, you need to be thinking about the future, and how your business will fit into it.  Consider, for a moment, if you are a marketing firm that has been at the top of your market for years, doing what you do.  If you don’t adapt to new technologies, you won’t remain viable in the marketplace.  Your market share will dwindle.

On the other side of the coin, though, if you help to create the future – you impact future thinking, you will increase your market share.  Quick example.  Intel.  Nobody thought there would be any use for a Microprocessor.  Ever.  Enough said.

A company that didn’t predict the future – International Business Machines.  They never believed that the personal computer would be viable.

Where is your industry going?  How does the economy effect your business?  What opportunities will you be able to take advantage of once the recession is over?  What emerging technologies/fads/methods will impact your business?  Can you become a virtual company?  Could you/should you be competing on a global level?

Your business needs to invest in itself to answer those questions, for the very same reasons Disney and GM did.  Hope.  Inspiration and Marketing.  Own the future.

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Integrity and Sustainability

CNN – Powell Choice Of Obama A Slap To GOP, Analysts Say.  One of the reasons for Powell’s decision was based on the negative campaign being run by the GOP. clip_image002 While his decision and explanation carry much more weight, there are many people – inside and outside of America who may feel the same way. 

Does this mean Senator McCain is less capable then Senator Obama?  Not actually.  But what does this say about his character, and that of the Republican Party?  A “win at all costs” mentality could result in 305,461,482 losers (.t the time of publishing).

No one exists in a bubble.  As a business owner, you cannot expect to go around the community tearing down other business, customers and employees, and expect to achieve your full potential If you are a small business owner, and you act without character and integrity, your business will more-than-likely fail.  I have seen it over and over and over again.  I have seen the same business owner fail over and over and over again.

You’ve got to take care of the people, business and communities that take care of you.  That doesn’t mean that you wait for them to do something – it is not a self-serving activity.  You make the first steps without seeking your own objectives.  You compete, but you do so with honor, character and integrity.

As my friend Robert Rosner would say, be a “Friend for Life.”

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No Bailouts for Small Business…So What's Next?

Well, the reality is that you’ve got to evaluate where you are.  Your business might be at a critical precipice, and you need to be aware of it.  Many economists are clip_image002suggesting that this is the time where many poorly run or fly-by-night small businesses are going to be losing their shirts and going out of business.

On the other hand, there will be lots of businesses that are going to thrive.  They are finding new opportunities, partnering with other businesses and finding ways to move forward.

Where are you, and what will make the difference?  Is it time to sit down and review those processes and systems? If you need to cut costs, do you know where those costs are?

Think about how you might cut costs without compromising the integrity of your organization.  That means that you don’t cut marketing, training, insurance, etc.  You cut out the gourmet coffee service, the gourmet lunches and other luxuries.  Take a look at your organization’s want/need matrix.  If you don’t have one, do it now.

Lastly, evaluate your organization’s SWOT.  Identify some new opportunities.  Maybe, by taking your company virtual, you can increase some efficiencies and cut some costs.  If you switched from land line service to VOIP and mobile services, could you still offer the same great quality products and services your clients come to expect from you?  Maybe there is a struggling organization that would expand your organization’s capabilities or capacities at some great efficiencies.

Remember – this is business.  The immutable law of business is just when you think you understand the situation, the situation changes.

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…Why So Stupid? From Thinking Managers

A blog posting on Thinking Managers, “Management thinking: why so stupid?” ( centers around the idea that managers need to think differently.  By not thinking reactively but rather proactively, managers will be in a better position to make good decisions.

As a student of Strategic Foresight, I agree with this, and even expanded the idea in commentary, below:clip_image002

What a logical commentary!  I see and understand the limitations of our learning models.  It seems like you are suggesting that thinking become a more involved exercise then simply reiterating what we have seen or learned.  I understand you are saying that we should take and apply our knowledge and experiences, synergistically, and develop a more creative outcome.

It seems as though thinking creatively would lead one to needing to create several different scenarios, and look at possible outcomes of each scenario, as you’ve described when a doctor diagnosis.  I suspect that if we think about the immediate ramifications of a decision along with the long-term ramifications of a decision – some possible scenarios, we can have even greater influence when being proactive.

For example – my family has a history of of heart disease and diabetes.  Now, thinking reactively, I could wait and see if I get it, and respond by dying, being medicated or changing my diet, exercising and being medicated.  Thinking creatively, I might visit the doctor, yearly, to see how my body is progressing toward possible diseases, and be responsive as indicators are revealed.  Thinking futuristically (so to speak), I could have chosen to start exercising and watching my diet, years ago (which I did) in an effort to reduce the chances of contracting the diseases altogether, in addition to visiting the doctor, yearly for a checkup.

If we, as managers thought like that, we might end up being leaders instead of managers, and developing more productive, knowledgeable workers who were committed to a shared vision. 

Please leave comments, below.

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Kiss Office Rent Goodbye…or Maybe Not!!

I had a great conversation, yesterday, with Scott Sherman, the COO at KIS Business, about the realities of “Cloud Computing” as SAAS office products are  being called.  According to Moderro Technologies, applications included in your cloud will include services such as:

  • An Office Suite – email, calendar, “word processor”, clip_image002spreadsheets and presentation software
  • Business Applications – CRM (Customer Relationship Management), ERP (Enterprise Resource Planning), Accounting, Databases and HR Services (e.g. FlexHR’s Employee Universe)
  • Project Management and Collaboration software

According to Sherman, the problem with Cloud Computing has to do with security – keeping your company’s private information, private.  If you think about Governor’s Palin’s predicament with her email account, you have to take into consideration what could happen to your company’s information, in the hands of the wrong people.

Does this mean that you are stuck paying office rent for the next 20 years?  Definitely not.  Your ability to be mobile and to collaborate with workers anywhere in the world may be closer to your horizon than you realize.  Being able to pick up and work anywhere, anytime will help your productivity, substantially.

Does this mean that you have to purchase and maintain your own server – as if you have nothing better to do?  Not reasonable.

Does it mean that you have to take a risk with some of the free services?  Probably not the best option, either.

It means that you’ve got to find a solution that will work for your organization.  Consider the following as you plan for your integration.

  • Risk – there is a risk horizon you need to be aware of.  The more visible your organization and the more desirable (unique) your information is, the more at risk you are for a breech.
  • Planning – as your organization grows, you will want to move to tighter and tighter security models.  Some of the SAAS environments do offer 128 and 256 bit encryption service, often at a higher cost.
  • Productivity – While you may not wish to get all services from one organization, you’ll want to ensure that systems that need to work together can.
  • Support and Maintenance – Ensure these are available, around the clock.
  • Matching – Before reviewing the products, make yourself a weighted list of requirements, or a wish list for the ideal product.  Then see how each product stacks up.  Include cost, complexity, learning curve and scale ability and security.
  • Pricing – Ensure you do an apples to apples comparison.  A company that offers 1 G of storage for an unlimited number of users is not the same as 15G of storage for 5 users.  You’ll have to look at the software services in terms of which will give the greatest value proposition for your organization.

While you may not be ready today to invest in a mobile office, or you feel a product such as Windows Live Small Business, Google or ZOHO may be fine for you, do not rush into this at the last moment.  Like any business decision, be decisive and committed to doing it the right way, set a goal for getting it done, set up a list of criteria for quality and do your homework!

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