Big Important Things – risk and opportunity identification

30 11 2007

“Big Important Things” (BITs),  are local, regional, national or international circumstances or events that cannot be controlled or prevented, that have a significant effect on current and future business practices.

One should always keep in mind the impact of the “Big Important Things” (BITs) on the supply chain, customers, the competition and your industry.

Those involved in strategy and planning must understand how BITs create enormous risks and opportunities.

One can only react to BITs, they cannot be created or eliminated by an organization.

BITs would include, but not be limited to:

  • Natural and man made disasters – hurricanes, fires, earthquakes, explosions, flooding.
  • Massive economic changes – depression, recession, inflation, currency devaluation, massive layoffs
  • War and Terrorism – security measures, logistics, international trade limitations
  • Government policies – trade barriers, laws and regulations, economic sanctions, embargoes
  • New technologies, – trends and tendencies inside and outside of the industry
  • Environmental or health issues – contamination, unsafe products, epidemics
  • Legal issues – pending or current lawsuits, documentation and reporting, legal precedents
  • Significant global changes in demand or supply – shortages, increased demand
  • Energy costs – trends and tendencies

Contingency plans should be created, worst-case and best-case scenarios developed, and efforts made to lower the risk profile or strategically position the company to take advantage of possible changes in the business environment.

How to use BITs to identify areas of risk and opportunity 

  1. Analyze each of the following elements independently;  strategic raw materials, suppliers, logistics, major customers, the competition, your company, and finally your industry (local, national and internationally).
  2. What is the probability that a BIT would affect each element (impossible, low, medium, high, inevitable) and when (short-medium-long term)?  “My supplier is the only manufacturer in North America of the widgets we need, they are located on the western Florida coast and annually are affected to some degree my hurricanes and flooding.  There is a high probability that a major hurricane will hit them in the short to medium term.”
  3. Use a “what if” line of questioning for those high risk or high impact areas.  “What if a major hurricane hit my supplier and disrupted their production?
  4. What are possible scenarios to reduce your risk, or take advantage of the opportunity.  “Do I have alternative suppliers in place, extra inventory, insurance, how can I protect my customers, who else will this affect and how?
  5. Review this process at least twice a year to take into account changes in the probability of the BITs and modify the contingency plans or strategies accordingly.

Related Links

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How to Systematically Analyze Any Situation for Better Decision Making

9 Steps to Better Decisions





Maximize the impact of business conferences, seminars, and special events in your organization

15 06 2007

Attending business conferences, special events, lectures, seminars, classes and courses are part of our professional lives.

Events provide great information, professional tips, up to date industry information, inspirational and motivational ideas, and fantastic opportunities to expand your business network.

Unfortunately not all the events are interesting, useful or entertaining.   At times it is a waste of time and money.

But the occasional great event is inspirational, we leave the room vibrating with ideas, enthusiasm, motivation and the desire to put the words and concepts to work in our own lives and business organization.

Two days later we forgot about what we were going to do, how we were going to do it, and why it was important.

Then we sign up for another event, and the cycle repeats itself.

How can we take full advantage of the ideas, knowledge and opportunities from business events?

To get the most out of these events a bit of planning and follow through will allow you to maximize this knowledge and it’s impact in your professional and personal life.

Before you go

  1. Main reason why are you going to attend?  Write down your reasons for attending; to gain specific business knowledge, exploration (don’t know what to expect, but it might be good), my boss thinks it might be important, seek inspiration or motivation, networking opportunities.
  2. Why do you expect to learn, or who do you expect to meet?
  3. Can you do anything to prepare before you go?  Contact people before you go, read works from the author or about the topic, prepare specific questions?

After the event

  1. Write a brief,  one page, executive summary.
  2. Include the name of the event, place, date.
  3. What was the conference/event about.
  4. Note any reference materials given at the event, where are you going to file or save them?
  5. What did you learn that is applicable to you or your business?  This might be a general concept, or specific information, it’s what you want to bring back and implement.
  6. Who else in the organization should know about the information or is affected by it?
  7. Who did you meet while there, full contact information, how can they be interesting to your business in the future.
  8. What follow-up required (thank you notes, contact specific people, more research, share it with others, file it, forget it).
  9. What should be investigated further, and who should do it.
  10. What does it take to implement or disseminate the idea or knowledge in your business (resources, people, attitude, commitment).
  11. Personal comments or observations, what did you feel.
  12. Retain all these executive summaries in a file titles “Events, Conferences, Seminars, Classes, Lectures” or something similar, organize events by date, subject or month.
  13. Review your summary in 30 days and note progress or lack of progress.   What happened or didn’t happen?

The key to maximizing the impact of a special event in your organization is to take a few moments to reflect upon your objectives before attending and then summarizing your learning, next actions and follow through required after the event.

Simple, focused and effective.

Highly recommended that each attendee from your organization be required or encouraged to keep such a file, and share it with their co-workers or managers.

Related Links

Video: Mind Mapping by Stephen Pierce 

How to systematically analyze any decision for better decision making

9 steps to better decisions





The point of no return

18 01 2007

The hardest part of decision making is passing the “point of no return“.

While the situation is being analyzed we’re safe.

Wacky, imaginative and wild solutions can be discussed and their impact and effect weighed and discussed. But it’s theoretical, it’s safe.

The minute we have to make the decision, take responsibility for the action and outcome, then we enter into scary territory.

The key to decision making is to get the momentum, confidence, courage and motivation in order to pass the point of no return.

I’m not saying that your decision will always be correct. But what is important is to make a decision and not spend hours, days and weeks agonized and postponing the process and decision.

Picture yourself on a diving board. High above the water. It’s scary to think that you may not perform the dive perfectly. A belly flop would be embarrassing and painful.

There are three options available.

  1. Stay where you are, agonizing over the decision to jump.
  2. Go back down the ladder, let someone else jump.
  3. Jump.  Leave the diving board, cross the point of no return, make the dive.

When we are sure of our abilities and understanding due to good research and experience, we have confidence.

When we are not afraid of making a mistake, we have courage.

When we know the decision is important and necessary in order to keep things moving and get on with other activities, then we are motivated.

Focus on the task and problem, create the solutions and make the decisions on time.

Push yourself to pass the point of no return quickly and with confidence.

Jump.

Related Links

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Why do we fail

22 12 2006

No one likes to fail.

We can feel foolish, outmaneuvered, incompetent, insecure, unlucky, silly, angry, overwhelmed, frustrated and in some cases afraid to try again. after suffering a defeat.

Failure is an integral part of the learning process.

Failure is required in order to become successful.

Rare is the successful individual, product or organization that has not met adversity, failure, defeat and loss.

One of the keys to success is the ability to accept failure, learn from the experience and try again.

The fear of failure is so great in some organizations that it freezes innovation, thwarts change and stifles growth.

Organizations try to reduce or limit failure by passing on historically successful methods and accumulated knowledge to new members.

Many times this information is not useful and out of date because the elements, players and dynamics of today’s challenges are quite different from those of the past.

Use the following list to analyze your current projects (and possibly prevent or limit failure), or use the list after a setback or defeat to identify where you can improve.

Reasons for business failure can be broken into 4 main groups:

Planning

  • No plan
  • Incomplete plan
  • Wrong calculations
  • Poor or incomplete interpretation of data and research
  • Failure to take into account all factors
  • Lack of experience
  • Failure to evaluate competitor reactions correctly
  • Failure to anticipate consumer response
  • Significant difference between planned and actual costs
  • Poor cash flow calculations
  • Unrealistic goals and expected outcomes
  • Underestimate risks

Information

  • Didn’t collect all the pertinent information for planning
  • Product or service was not wanted or needed by customer
  • Lack of knowledge of market
  • Lack of knowledge of customers
  • Lack of experience in the industry
  • Lack of experience in manufacturing
  • Lack of experience in sales and marketing
  • Lack of experience in administration

Operations and Follow-through

  • Lazy, didn’t do the work required
  • Undisciplined
  • Unorganized
  • No control of suppliers
  • Did not stop in time and take corrective actions
  • Did not recognize warning signs
  • Ignored warning signs
  • Did not seek professional assistance
  • Lack of attention to logistics details
  • Failure to focus on customers needs, desires and wants
  • Poorly trained personnel
  • Lack of initial capital
  • Not enough capital to maintain operations for first years

Factors outside of our control

  • Important changes in technology
  • Environmental factors
  • International, Federal, State or local government laws, regulations and legislation
  • Aggressive competitor(s)
  • Act of God
  • Change in fashion and trends
  • Theft and fraud

Related Links

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The future of our entry level workforce – gloomy

19 10 2006

Will our future entry level workforce be competitive and competent?

Are we ready to build a nation full of entrepreneurs and world class workers?

I highly recommend you read the study published by the The Conference Board, Corporate Voices for Working Families, the Partnership for 21st Century Skills, and the Society for Human Resource Management, entitled:

Are They Really Ready To Work? Employers’ Perspectives on the Basic Knowledge and Applied Skills of New Entrants to the 21st Century U.S. Workforce”

According to this study of 431 companies in the US, representing over 2 million employees in a variety of industries and geographic areas, the future is bleak.

“The future U.S. workforce is here—and it is woefully ill-prepared for the demands of today’s (and tomorrow’s) workplace.”

The basic skills and knowledge identified and considered to be very important elements for future employees include:

  • English Language (spoken)
  • Government/Economics
  • Reading Comprehension (in English)
  • Humanities/Arts
  • Writing in English (grammar, spelling, etc.)
  • Foreign Languages
  • Mathematics History/Geography
  • Science

The applied skills, which are increasing in importance as criteria for success in the future:

  • Critical Thinking/Problem Solving—Exercise sound reasoning and analytical thinking; use knowledge, facts, and data to solve workplace problems; apply math and science concepts to problem solving.
  • Oral Communications—Articulate thoughts, ideas clearly and effectively; have public speaking skills.
  • Written Communications—Write memos, letters and complex technical reports clearly and effectively.
  • Teamwork/Collaboration—Build collaborative relationships with colleagues and customers; be able to work with diverse teams, negotiate and manage conflicts.
  • Diversity—Learn from and work collaboratively with individuals representing diverse cultures, races, ages, gender, religions, lifestyles, and viewpoints.
  • Information Technology Application—Select and use appropriate technology to accomplish a given task, apply computing skills to problem-solving.
  • Leadership—Leverage the strengths of others to achieve common goals; use interpersonal skills to coach and develop others.
  • Creativity/Innovation—Demonstrate originality and inventiveness in work; communicate new ideas to others; integrate knowledge across different disciplines.
  • Lifelong Learning/Self Direction—Be able to continuously acquire new knowledge and skills; monitor one’s own learning needs; be able to learn from one’s mistakes.
  • Professionalism/Work Ethic—Demonstrate personal accountability, effective work habits, e.g., punctuality, working productively with others, and time and workload management.
  • Ethics/Social Responsibility—Demonstrate integrity and ethical behavior; act responsibly with the interests of the larger community in mind.

Excepts from the study:”Business leaders must take an active role in outlining the kinds of skills we need from our employees for our companies and economy to thrive.”

“As business leaders, we must also play a role in creating opportunities for young people to obtain the skills they need. Businesses can partner with schools and other organizations that work with young people to provide internships, job shadowing programs and summer jobs. Businesses can encourage their employees to serve as mentors and tutors. Businesses can invest in programs at the local and national level that have demonstrated their ability to improve outcomes for young people.
Finally, business leaders can use their expertise in innovation and management to help identify
new and creative solutions.”

We assume that our schools are producing graduates with fundamental business abilities, why isn’t it happening?

Are we going to accept that the training of the future workforce is in the hands of private business, and not the educational system?

What is the cost to business when new employees must be given remedial training, just to get them up to entry level?

What is your organization doing right now to ensure, or create talent for the future?

Read the study, pass it around the office and makes sure the boss and human resource people get copies.

This is no longer someone elses’s problem.

“ The numbers don’t bode well for the future—the future of our workforce. It is in our interest to help solve the problem. And business has the capacity to help solve the problem by partnering with education and community leaders to create opportunities for young people to practice the skills they need to be successful.” – Bill Shore, Director, U.S. Community Partners, GlaxoSmithKline

Related Links

The Conference Board: Are they really ready for work?

Are they really ready to work (PDF)

Most young people entering the US workforce lack critical skills essential for success

Young Workforce is “Ill-Prepared”





Great International Business Trip Results

16 10 2006

In any international relationship communication and understanding are critical for success.

Problems created by; language, stereotypes, misinformation, lack of information, and cultural misunderstandings combine with normal business problems to create a complicated scenario for anyone involved in international relationships and global business.

Prepare your international meetings and business presentations using the following questions as a guide to organize your ideas and focus on actions that will produce positive results for everyone involved.

6 Questions – Create Great International Business Trip Results

  1. What does this organization know about me, my company and my country?
  2. What do they think they know about me?
  3. What can I tell them that they do not know?
  4. What do I know about my international partner, culture and country?
  5. What do I think I know about this business, culture and country?
  6. What can they tell me that I do not know?

1. What does this organization know about me and my company. When you walk in the room an opinion has already been formed about you, your organization, and your ability to perform in the future. These ideas are based upon facts, information and past experience.

  • What has been the history of our relationship in their country?
  • Who has been involved in our mutual business, and why?
  • What promises have been made and kept by both?
  • What promises have been made and not delivered upon?
  • What have the major problems and success been in the past?
  • Press and media, our organizations promotional material.

2. What do they think they know about me. Clarifying the unknowns or presumed realities in a relationship is crucial to success. These ideas may be very damaging and limit your ability to trust one another. What stereotypical behaviour can you avoid or prevent? What can you clarify or refute through information or actions?

  • Behaviour and reacts based upon past experience with your organization.
  • Rumour and innuendo, press and media reports.
  • Negotiation styles.
  • Business objectives.
  • Behaviour, goals and methods of doing business based upon country and cultural stereotypes.

3. What can I tell them that they do not know. Today’s business world requires trust, information and solutions. Reinforcing your need to work with your international partner, providing important information or solutions, and clarifying misunderstandings can only help the relationship.

  • Clarify or destroy cultural stereotypes.
  • Clarify business objectives and why they are important in order to reach these objectives.
  • Provide solutions and alternatives to existing situations and challenges.
  • Provide information of value for their business and strategy.
  • Clearly identify current or potential business problems.
  • Predict and have answers ready for their questions.

4. What do I know about my International partner, culture and country? What do I know is true and not innuendo or interpretation? The numbers, facts, information, agreements and past performance history of the business. Information about the country and the business culture.

5. What do I think I know about this business, culture and country? What preconceived ideas and stereotypes are you working with? What are you assuming and what has been proven?

6. What can they tell me that I do not know? What questions do you need to ask in order to verify information or create plans. What pieces of your information puzzle are missing? This is the time to get your questions answered, what are they?

Related Links

Cultural misunderstanding it can happen to you

Stereotypes and global business

Create great international business relationships

16 Essential questions – the international business traveller’s quiz

Lessons in international business





What can we learn from the piracy business model

10 10 2006

Here is a interesting way to view, prepare for and compete against businesses copying and pirating your content or products.

Piracy is a business model. Anne Sweeney, co-chair of Disney Media Networks and president of Disney-ABC Television Group, announced during a keynote address at MIPCOM. While her focus was on the pirating of media content, the same message applies for manufactured goods.

“It exists to serve a need in the market….. Pirates compete the same way we do – through quality, price and availability. We don’t like the model but we realize it’s competitive enough to make it a major competitor going forward.

What’s so amazing about this?

Taking the piracy is a business model approach allows us to analyze the business model and how it is acting or reacting to the economic fundamentals in the market.

Instead of locking up our company secrets and seeking punishments for the pirates, we can analyze why and where our “competition” is taking advantage of us in order to strengthen and modify our business model.

None of this changes the actual situation. But it might change business strategies and planning when you realize they are competitors and they are here to stay.

What are the advantages of being a pirate, and the disadvantages?

Why are there opportunities for them? What should I be doing that I’m not?

How can I change my organization to take back the market from the pirates?

Once weaknesses in the piracy business model are identified they can be exploited. When strengths are discovered, they can be integrated into our own business model.

The fight against piracy should begin with a focused analysis of the market environment, existing business models and new strategies on how to adapt to the changing market conditions and exploit them to your advantage.

We can stop focusing on the individual “pirates” and their control or capture, and move toward competing intelligently against them.

Related Links

The easy way

The power of something extra

Netribution – Disney Co-Chair recognizes ‘piracy is a business model’

Boing Boing – Disney exec: Piracy is just a business model

@MIPCOM Piracy is a business model