A Talentist: 28

July 06, 2007

28

Business does not exist in a vacuum. So while my purpose may be to build better businesses on a better business and economic model, there is no part of how businesses exist in a larger ecosystem that isn't worth examining. Take the education system for example. It's not just that the modern western education system is destroying something of incredible value to the businesses of the future (imginiation and curiosity), it is also that the system is creating massive structural inequalities that will eventually shrink potnetial markets for goods and services. Our education system is driving a massive wedge between the upper and lower classes in America, splitting the middle class between those willing to mortgage their futures to get into the right school district and those who either can’t afford, or think it is imprudent, to take that kind of risk. The fault line that is being created by a lack of corporate recruiting competence is leaving the poor completely behind. They can’t afford to move into the right school districts, to get access to an education and supportive peer group that will ensure that they will get into the right college so that they can get the right job. And since the poor are disproportionately people of color, the corporate system is blasting away at it’s foot in two ways: first, by ensuring that the possible pool of talent it can draw from is always scarce and reinforcing behaviors that are antithetical to sustaintable advantage in the creative age, and second, because diversity of background, opinion, perspective and thought are critical to the creative process. But since corporations are ensuring that every nervous parent in America is obsessed with homogenizing the unique perspectives, thoughts, opinions and backgrounds from their kids as they move in droves to exclusive gated communities, the talent pool needed to sustain competitive advantage is shrinking at a rate that is inversely proportional to the overall value of talent to the enterprise. That’s right: the corporate system of selection based on experience and education ensures that as the possible talent pool grows due to immigration and globalization, and as the potential value of that pool grows relative to the needs of the organization, that corporations will actually have an ever smaller pool from which to pick.

July 06, 2007 in Education, Numbers, Talent, Talentism Principle | Permalink

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Twenty years reaps many entrepreneurial lessons
When I decided to start my own business, my two closest neighbors — both of whom worked for a huge corporation — were worried about my future, concerned about my losing the security of a paycheck. That was in January 1986.
Twenty years later, I'm still in business. Within two years of my starting a business, both neighbors had lost their jobs.

How the economy has changed in those two decades. Then, the best and brightest business school students hoped to work for Fortune 500 companies or mega consulting firms. When someone said "small business," they usually meant a "mom-and-pop" store.

Now a small business is just as likely to be a fast-growing innovative company, and Mom and Pop work for their twentysomething kid.

Today, hundreds of universities and colleges offer degrees or certificates in entrepreneurship or small business management. More than a half million new businesses are started each month, according to the Kauffman Foundation. And in a 2005 poll conducted by Junior Achievement, 69% of teens said they wanted to start their own businesses.

Back in 1986, almost no one used the word "entrepreneur." Today, everyone wants to be one.

What are the most important lessons I've learned about running a business during the last 20 years? What did I wish I knew when I was starting out?

• Develop a business plan and update it annually. Without a doubt, the single greatest positive impact on my business has been our annual business planning process. It has directly increased both our sales and our focus.

• Get help. I waited too long before I hired an assistant. Hiring your first employee is a big hurdle, but if you're spending too much of your time dealing with administrative matters rather than income-producing activities, get help.

• Hire for attitude, train for skills. People can learn skills, but it's almost impossible to change someone's personality. If necessary, leave a position vacant until you find someone with a good attitude toward getting the job done.

• Use a consultant. Even though I was a management consultant myself, I've hired consultants throughout the life of my businesses. A good consultant brings fresh eyes and fresh ideas to help you grow your business or solve business issues.

• Embrace technology. I see many small businesses that waste precious time doing routine paperwork by hand or using a 10-year-old bookkeeping system, or who still don't have a website. Properly used, technology reduces costs, increases sales and gives you better information on which to make key business decisions.

• Join an industry association. You don't build a business in a vacuum; what's going on in your industry affects the health of your business. It's critical to stay on top of trends and issues in your field.

• Talk to your "competitors." My first years in business, I stayed away from other consultants, fearing them as competition. But over the years, many became sources of referrals and vital business-growing information. Not everyone is out to get you.

• If you must have a partner, get a written partnership agreement before you start your business. Spell out every aspect of your working relationship, including exactly what happens if one of you wants out or you disagree. The most difficult business issue I've faced was ending a partnership.

• Bring your dog to work. When my business grew too large for a home office, I made certain the office space we rented allowed us to bring dogs. We have three dogs in our office now, including my dog, Cosmo, and I love it.

• Expect to change. If you want your business to survive, you need to regularly assess and reinvent your business. Although I've done some of the same things for many years (for example, I've written this column for over 13 years), my business has significantly evolved. In fact, I've had four businesses, but all have been evolutions of my core competency of assisting small companies to plan and grow their businesses.

During these past two decades, I've had the opportunity to work with entrepreneurs from Sioux Falls to Sydney, Baltimore to Barcelona. And my respect has grown continually for those who build new companies, invent new products and services, and most importantly, create new jobs. They — you — are my heroes.

Rhonda Abrams is author of The Successful Business Plan: Secrets & Strategies and president of The Planning Shop, publishers of books and other tools for business plans. Register for Rhonda's free business planning newsletter at www.PlanningShop.com. For an index of her columns, click here. Copyright Rhonda Abrams 2006.

Posted by: Jeremy Langhans | July 23, 2007 at 07:32 PM

Our business will mark its 20th in 2008, and I could not agree more with Jeremy's comments. He is spot on. My only addition to his list is to borrow the following piece of neutron Jack's philosophy: "Don't be afraid to hire people who are smarter than you."

Posted by: Dave Opton | August 01, 2007 at 06:50 AM

Unfortunately, I put a lot of the blame on the recruiters. They are the mold makers for the cookie cutter they use to screen candidates. Candidates with no imagination - they love them. They have a steady job history, they never make waves, they never rebelled against anything and anybody. Newsflash: imagination and individualism always lead to rebellion in some form or another. That is going to leave a trace in a resume, a trace which recruiters don't like and are taught to specifically screen out for.

Posted by: Renata Dumitrascu | November 12, 2007 at 09:54 AM

With the growing number of the world's population, one would think that we a re a community thriving with lots and lots of variety. Unfortunately, as you say, what really happens is that there is much less to choose from. It makes me think of opportunities wasted on people with no imagination at all. It is in cases like this that risks become worth taking.

Posted by: jen_chan, writer MemberSpeed.com | November 14, 2007 at 05:31 AM