Monthly Archives: November 2009

Are You an Enemy?

Have you ever felt like you don’t belong in a group or in a team? Whether it’s with friends, work colleagues, or even with your family, I would assume this a feeling we’ve all had at least once in our lives. I believe “belonging” is a vital part of our social lives as it provides us with a sense of value and appreciation. Other members of the group will tend to respect you more and demonstrate trust in your character and abilities.

But what happens when you don’t belong? Will you be trusted, appreciated, and valued? One of the major problems I’ve seen with groups that promote a strong sense of belonging is that individuals with different opinions and that have a tendency to challenge the group, even in the best of intents, are prone to be pushed away from the group. If you don’t abide to the leader’s principles and if you constructively challenge the leader’s opinions, chances are you will no longer belong, and in the worst case scenario, you might even be portrayed as an enemy, in all its meaning. I’ve seen this behavior in the context of groups of friends, in the work place, and even in families. If you have strong beliefs and opinions and are not afraid of sharing it with your peers, you might just end up as the enemy. It’s possible to hear in the workplace so-called company leaders say they would like to knock a colleague’s teeth out for not being in agreement with their opinion and not inline with their way of operating. Someone might even be called a “spy” or a “traitor” for willingly changing division within the company – such a person is clearly seen as an enemy for not following the group. How bad can it get? This also even extends to families, where family members are pushed away, chastised, because they weren’t following the family “leader”.

This is at the core of groupthink. Groupthink is a thought process that individuals tend to adopt when they are deeply involved in cohesive groups where unanimity is the prime objective. The characteristics of groupthink include feelings of invulnerability, moral superiority, group pressure, and self-censorship. This type of behavior has even been shown to be partially responsible for corporate scandals and bankruptcies (WorldCom Scandal).

I see this as an extremely unhealthy cult-like attitude that has no place for independent thinkers. It’s the “tribe” mentality without restraint. By the way, I’ve heard of a book called “Tribes”, which apparently sells well and is quite good, but I haven’t read it. First, to me the word tribe has a negative connotation and is not well viewed from a cultural anthropology perspective. In addition, it portrays the concept of seclusion and lack of cooperation between different entities, outside of the so called tribe. But that’s my opinion.

In any case, whether its groupthink, closed tribe mentality, or any other form of association that restrains creativity and open thinking, I believe it will lead you to failure. It will drain your energy, kill your confidence, and you will lose your sense of unique value. It may be hard to actually see if you’re currently in such a situation, but if you are, I would say do all you can to get out of it. If you’re reprimanded for providing constructive feedback that is not inline with the group’s vision, or if you feel you’re being put on the side because of your independent thinking, than chances are you’re living it head on.

Blindly playing follow-the-leader doesn’t always end well.

Bookmark and Share

6 things NOT to do when starting a business – Part 2

In the previous article we talked about the importance of passion in starting a business, the need to be customer focused, as well as the need for “over delivering” – being exceptional. This was the conclusion of our discussion on what not to do: Starting a business for the sake of starting a business, under delivering, and being too product or technology centered. Today we look at three other mistakes that I strongly believe should be avoided when starting a business.

4. Being in Denial
Not knowing your market is definitely one of the best ways to drive your business to the ground. I also believe being obstinate and not willing to admit that you’ve made errors is as fatal. A company is a living and breathing entity that needs to evolve and adapt; so is your business plan. As such, if in the process of doing additional research you realize that your targeted market is not nearly as big as you had initially projected, or worse, there is barely a market for your product or service, don’t close your eyes to reality. Admit it. It may sound obvious, but when an entrepreneur has spent countless hours in building a business with a specific vision and direction in mind, it can be difficult to admit that you may have to throw your business plan in the trash and start over. I also believe many entrepreneurs are strongly opinionated and confident of their vision, which makes it even harder. When your initial plan is guaranteed to lead you to failure, be strong and admit you have to change your plan.

However, remember that change is part of starting a business. In fact, your initial plan is probably wrong and you will most likely end up doing something different. This leads us to Sidetracking.

5. Sidetracking
This refers to the concept of diverting from your main course. I believe there’s a fundamental but yet subtle difference between adapting your business plan and blindly changing entire course. Yes, there is probably countless times where you will doubt yourself or your business case, but it’s important not to go wild and turn your project inside out everyday. In my opinion, one of the joys of starting a business is having the opportunity to build your business from ground up. It’s the passion of being innovative, creative, and strategic. I call this the “white board” opportunity. With this opportunity comes the risk of being unfocused and putting your energy in different ideas that in the end will prevent you from breaking away from the start up phase to actually running a business. Avoid this. Think through it and make sure you understand the difference between adapting and sidetracking in your business project. Quite frankly, it might not always be obvious, but if you slow down and think about it, mistakes will be avoided.

6. Under or Over Networking
Talking about spending your energy wisely, one area we might not put enough attention in is networking. I have myself failed in this area in the past. I was strong on innovations and strategies but poor at networking. At the time of my first business it would take all of my strength and courage to go to a networking event, but once there, I would meet and greet with a fair amount of people. However, in the end these contacts would lead me nowhere. I would spend a lot of energy at networking without having a clear objective of what I wanted to achieve and because of that my networking efforts would not pay off. Remember, the objective of networking is to meet with people that have similar interests, objectives, and with who a win-win situation can be achieved. Everyone networks for the same reason – to grow their business. My advice is to make sure you spend your time wisely. Over networking, the act of trying to network with anyone and everyone, will take a lot of energy and may not be beneficial. Under networking on the other hand will deprive you of potential leads, sales, and business opportunities. Keep it balanced, inline with your objectives, and stay true to yourself.

There are certainly many more mistakes that should be avoided but from my own experience I felt the 6 mentioned in this article are overlooked but yet critical to the success of your business. I hope this article (part 1 and 2) will help fellow entrepreneurs avoid the mistakes I have made in the past, and in so doing support you in achieving your goals.

What other common mistakes do you believe should be avoided at all cost?


Bookmark and Share

6 things NOT to do when starting a business – Part 1

If you’ve ever read blogs or books on starting a business, you’ve probably read a million tips on how to succeed. But how many times have you seen relevant information on what not to do? The fact is, numerous startups “fail”, but much can be learned from that experience. Personally, I don’t like the term failure, because every startup experience is a success in itself. You gain quite a lot from it. Perhaps not financially in the short term, but it will pay off in many ways eventually.

According to Scott Shane’s Blog, the four year survival rate of new businesses in the IT sector is 38% (based on a 1998 startup date). So that means out of 10 new businesses that start at the same time as you, roughly only 4 will still be up and running after 4 years. I actually saw this first hand when I started my first 2 companies. After just 1 year, it surprised me to see that some fellow entrepreneurs, who started in the same year as me, had “closed shop”. As the years passed on, fewer and fewer remained.

But don’t get fooled by these statistics. It depends on the context, the location, the years, and many other factors. For instance, in my case we had started up just before the dot-com crash. That meant we were lucky enough to get our first round financing. But that also meant it became impossible for us to get our second round, especially since our primary investor entirely pulled out of tech investments (including us). Others followed, not because we had failed, but because of economic circumstances.

If context and location are critical factors in success, what are things that should be avoided? Here’s my position on this.

1.    Starting a business for starting a business
We’re entrepreneurs and we really want to run our own business. In fact, if you’re like me, starting a business just might be close to an obsession. But hear me out; take a step back and breathe. If you blindly follow your passion to start a business, you will probably end up spending a lot of energy on something that will not come to fruition. You’re likely to abandon the project.

In the last two years I researched about a dozen potential business projects. Researching and validating your idea is actually a great thing to do. But I’ve also gone all out and developed two full products, only to put them on the “shelf” when I was done.

The first one was a mobile application that integrated geo-positioning, social networking and event management for Android phones (when the phone wasn’t even on the market yet). When I look at it now, I’m wondering why the heck I abandoned this project. The answer is passion. The application just didn’t appeal to me that much in the end. The fun was in the challenge of doing it and in the motivation of starting a new project, but it wouldn’t be my business of choice and I actually didn’t see this as being the next big thing. So I stopped.

mevent-mashupsm

A few months later, my wife had a great idea about developing a multimedia mashup application a la scrapbooking. I spent a huge amount of hours to build a full prototype using Flex for the front end, PHP for the MW, and mySQL for the database. I did the whole application, my wife worked on vector graphics, and we managed to get some people to sign up. It’s actually not bad, but it’s not exceptional. Again, it was a challenge, and I proved myself I could develop this. But after letting pilot users play around with the website, most of them didn’t come back. Because of this, I got discouraged, and decided not to continue with the project. However, in reality I didn’t abandon this project because of this obstacle. I abandoned it because I wasn’t passionate enough to be fully committed and continue on regardless of obstacles. Remember, you will have many obstacles when starting a business, some quite difficult, so it’s critical that you have the strength and persistence, which can only be sustained with passion.

This leads us to the second “faux pas”.

2.     Under delivering
If you want to succeed in your business, you better be good at it. Whether you offer a product or a service, it’s critical to be outstanding at what you do, otherwise differentiating yourself and attracting customers will be difficult.

I’m not a software developer per say – sure I can develop lots of stuff, but I don’t consider myself to be an actual software developer and that’s not my real interest. We hear a lot about the importance of following our passion when starting a business these days. But the fact is that it’s true. If you start a business in something that isn’t 100% a passion for you, chances are you’ll abandon your project. In addition, your more likely to under deliver and be unable to clearly differentiate yourself from the mass. If starting businesses is your passion, pay close attention to what type of business you would like to run. Don’t get ahead of yourself and start any business idea that comes to mind. Think it through. Also, keep in mind that although you may be good at something, it doesn’t mean it’s your passion.

3.     Too Product Centered
Avoid being product and technology centered. Know who your market is and what their needs and interests are. If you don’t know, do your market research. A gut feeling is a good start, but it’s not sufficient. If you’re lucky enough, your gut feeling will realize itself, however chances are you will be wrong. As W. Edwards Deming once said:

“Do not rely on judgment as you will be wrong.”

This means you have to rely on data and facts. In my previous examples of the products I had developed, this is exactly the approach I had taken. I had an idea, and my feeling was that people would be interested. Although the idea might have appealed to a specific niche market, the form and realization of the product may not. Remember that a product or a service is multidimensional and you need to consider all of its dimensions: function, usability, quality, type, and importance, to name a few.

This concludes part 1. Stay tuned for part 2 of “6 things not to do when starting a business”, where I’ll cover the following items: Being in denial, Sidetracking, and Under or Over networking.

What do you believe should be avoided at all cost when starting a business? Have you ever experienced these mistakes?

Bookmark and Share