So you want to launch a business...

Your baby is ugly!

"The great tragedy of Science - the slaying of a beautiful hypothesis by an ugly fact."

Thomas H. Huxley

"In reality, just about all start-ups are ugly in the early days."

Dharmesh Shah

Encouraging entrepreneurs is a tricky business. 

It's a lot like parenting, as condescending as that may seem.  I say this because parents are advised to maintain clarity regarding the difference between the child herself and certain annoying, embarrassing, non-productive, and even anti-social behaviors. The child is not "bad."  The child is "naughty." I love you, sweetie, but that behavior has got to go, period.

The challenge for any parent or adviser is to encourage course changes without damaging the student's Moxie... and also to preserve your relationship at all costs.

For things to change in any real sense, the difficult child must be presented with information that leads her to draw a fresh set of conclusions about the results of behaviors on her own.  

So much for my challenges as an adviser to entrepreneurs.  Here's one for you Mr. Entrepreneur. 

Please ask yourself, regularly and honestly, "Is my baby ugly?"  Have I dreamed myself a Market opportunity instead of actually finding one?  Does my response to the perceived Market need really constitute Magic?  Or is it just a me-too?  Which of my fundamental assumptions carries the lowest confidence factor?  What simple tweak in my plan would gain me the most leverage?

Every swan, said Hans Christian Andersen, begins as an ugly duckling.  And Dharmesh Shah counsels,

Accept That Your Baby Is Ugly:  Just like most parents think they have beautiful babies, most entrepreneurs think they have beautiful start-ups.  In reality, just about all start-ups are ugly in the early days.  Don’t spend time trying to explain to others why your start-up baby is beautiful.  It’s not.  Instead, spend energy explaining why your baby is going to grow up  into something that’s beautiful. 

So, if you're feeling adventuresome and self-confident, try something new today.  Re-visit every one of your key assumptions about market size, end-user needs, competitive behavior, advertising effectiveness, contracting systems, manufacturing quality control, raw material costs, and so on.  Assume that at least part of your baby could benefit from some plastic surgery.

Ask yourself: how much of my plan's beauty is in only the eye of this beholder - me?

Is it blood? Or just ink?

"Projections are bullshit."

Jason Fried

I've become a fan of Scott Ginsberg, otherwise known as "NameTagScott."  He blogs on a variety of topics, but one of his recurring themes is honesty.  In a recent post, Scott said this...

My definition of writing is as follows:

“Slice open a vein and bleed your truth all over the page.”

KEY WORDS: Vein, blood and truth.

As opposed to “brain, ink and bullshit.”

Suppose we apply that thinking to entrepreneurial elevator speeches, pitches, and business plans.  I preach about the Four Fundamental Factors test for the probable outcome of a start-up notion.  Market - great!  Magic - spell-binding!  Mentors - plenty!  MOXIE - hmmm.  

Thanks, Scott!  I will now be asking myself: Am I hearing or reading "vein, blood, and truth?"  Or is it "brain, ink, and bullshit?"

I'm pretty darned sure that with enough MOXIE a prospective entrepreneur can find a way to fix a modestly flawed start-up plan.  But a bullshit artist will never, never find the MOXIE to make even a well conceived, well written plan really work.  Too many things change along the way.  Too many obstacles arise in the real world of entrepreneurship.  It's just too hard.

Serious success demands some bleeding, I think.  Or is it blood, sweat, and tears?  (The quotation, by the way, is really "...blood, tears, toil, and sweat."  Thank you, Teddy Roosevelt.)

Brain, ink, and bullshit won't cut it.  Remember that - whether you are writing a business plan, or reading one.

Thank you, Scott.

The Century of the Entrepreneur

"You can carve this in stone: the 21st century is the Century of the Entrepreneur. And the world is a better place as a result!"

Jim Blasingame

A few years back Jim Blasingame declared that we were entering the "century of the entrepreneur."  He listed four principal factors contributing to his conclusion: rapid advances in technology; an expanding view of market risk as exciting; a cultural shift in the definition of an appropriate work venue, with home now included; and broader public understanding of the power of equity participation.

Now, only ten years into the new century, we find ourselves in the midst of global turmoil.  Equity markets are undergoing major re-structuring.  Traditional weather patterns are now unreliable, disrupted by climate shift; and famine lurks.  Political and religious unrest abounds,including organized terrorism.  Piracy is most definitely back.  Yikes!

Was Blasingame wrong?

No, he was absolutely correct; but I'd like to offer a handful of of amendments to his list of entrepreneurship accelerators to be considered.

Technology shifts clearly stay at the head of the class.  Some specifics, however, are worthy of note.  In the industrial 20th century the ability to communicate globally began at near zero, but ended at universally available at almost no cost.  A business necessity that once demanded large corporations with economies of scale is now available to you and me, from any location.  And, on top of that, modest quantities of just about any product can now be economically transported around the globe in hours or days.

There are also some additional, less visible, but quite powerful, changes in the entrepreneurial landscape.  For example, computer-assisted design and manufacturing advances have radically reduced the time and cost of creating new products.   Once again, the scale factors required of 20th century industrial giants have been made available to individuals and small enterprises.  And the internet.  Ah, the internet.  Cheap marketing and advertising resources have never been so accessible.

BUT, the increasing cost of energy for transportation is driving many types of production, once centralized for economies of scale and moved around the world chasing cheap labor, to be re-de-centralized to be nearer to supplies of raw material and/or consumer markets.  (Sorry about the double hyphenation.  It just seems right, but only this once, of course.)  This is particularly evident in emerging trends in food production. Decentralization implies smaller units of production, which translates into the opportunity for entrepreneurial entries into markets formerly dominated by large organizations.  Global distribution of centrally, mass-produced goods (which was essentially a 20th century invention) is already falling out of favor, for straightforward energy cost reasons.

Risk is, of course, as Blasingame pointed out, exciting.  But it's still risk.  However, the recent economic shakeout definitely changed the relative attractiveness of entrepreneurship.  It suddenly became less risky.  What?  Yes.  Those stable, secure jobs in large industrial and financial institutions just aren't as secure as they once seemed.  The relative risk of personal entrepreneurship as compared to traditional employment options has been drastically reduced.  Which is better: being at risk and in the dark; or being at risk and calling the shots?

So, the 21st century entrepreneur can design and produce sophisticated products as quickly and cheaply as a large company, communicate with clients instantly, anywhere, and transport goods in small quantities on a global scale, all at a lower relative personal risk than ever before.

The Market is there.  The ability to perform Magic is more widely available than ever before.  If you have the Moxie, go find some solid Mentors, and give entrepreneurship a try.  Jim Flowers agrees with Jim Blasingame.  This is most definitely the century of the entrepreneur.  And making the world a better place should be a piece of cake.  There's unbelievable room for improvement.

Here's to the crazy ones...

Here's to the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes... the ones who see things differently -- they're not fond of rules... You can quote them, disagree with them, glorify or vilify them, but the only thing you can't do is ignore them because they change things... they push the human race forward, and while some may see them as the crazy ones, we see genius, because the ones who are crazy enough to think that they can change the world, are the ones who do.

    Steve Jobs

Some people never go crazy. What truly horrible lives they must lead.

    Charles Bukowski

Part of being sane, is being a little bit crazy.

    Janet Long

Do something. If it doesn't work, do something else. No idea is too crazy.

    Jim Hightower

You have to forget about what other people say; when you're supposed to die, when you're supposed to be lovin'. You have to forget about all these things. You have to go on and be crazy. Craziness is like heaven.

    Jimi Hendrix

Some (maybe most) people don't understand MOXIE.  They shake their heads in disbelief when apparently intelligent, clear-thinking people decide to chase entrepreneurial dreams instead of finding good jobs that promise stability and security. 

This presents a special problem for all you start-up founders.  Not only must you identify and overcome all the obvious business challenges, you must also deal with all the skeptics among your friends, family, and the investment community.  All too often they fail to understand that you only look crazy - from their perspective, certainly not from yours. 

Sometimes they're right, though.  So it's not crazy to do one more re-check of the data, one more test of your assumptions.  Make sure you're intelligently audacious, not actually crazy.

Are you attacking a real Market, not one you have imagined?  Do you have some powerful Magic that will attract spell-bound clients?  Have you surrounded yourself with seasoned Mentors who can provide the information and perspective that you lack?

If your business concept can pass the Four Fundamental Factors test, you might even be able to convince the skeptics.  And sometimes the Magic really works.

And that's when Jimi is absolutely right.  "Craziness is like heaven."

Experts Agree. Best MOXIE Posts of 2009.

The polls are closed.  The readers have spoken.

The most popular, and presumably most useful, MOXIE posts from the past year are presented below.

1. How to eat a five hundred pound marshmallow.

The vast gorge that lies between noble intent and significant achievement is, of course, quite real, and widely documented.  Lofty goals are commonplace.  Noteworthy achievement?  Not so much.  And this is particularly true for entrepreneurs and their ambitious startup plans.  (More...)

2. Four really useful habits.

I'm pretty darned sure that these four things will take most anybody a long way down the road to achievement and contentment: clarity of vision, commitment to relevant action, adherence to noble principles, and focus.  (More...)

3. Success - Ten Traits Supporting Four Fundamental Factors.

"Success or failure of a new venture is determined very early, on the strength or weakness of only a few fundamental factors, four to be exact.  Those four factors are Moxie, Market, Magic, and Mentors."  (More...)

4. I'm not losing.  I'm learning.

For a scientist, an experiment that does not confirm the hypothesis is not a failure.  It is a useful stepping stone to a fresh hypothesis.  For a musician, a bad review provides clarity on how the performance can be improved.  For an entrepreneur, a rejected product is a clear message about the true needs of the marketplace.  (More...)

5. Secret Revealed!  How to Get What You Want...

One of the most common reasons given for pursuit of entrepreneurship is the need for autonomy, the need to be in charge.  Over and over again, unfortunately, I meet people who have become slaves to the businesses that were supposed to give them freedom.  That's just plain sad.  (More...)

6. The inconvenient truth about competitors.

A sadly pervasive startup mistake is the presumption that a market leader will not react forcefully or cleverly to the entry of a fresh competitor - or that there will not be yet another entrant, complicating the situation even further.  (More...)

Start-up Success - Four Fundamental Factors

I've been hanging around start-ups for a while - roughly forty years and counting.  Over that time the information I've collected has clustered together to convince me of three things. 

1. Success or failure of a new venture is largely determined very early on the strength or weakness of only a few fundamental factors, four, to be exact.
2. Those four factors are Market, Magic, Moxie, and Mentors.  If these are not "right", nothing else really matters.  It's not that a business with some weaknesses in these areas can't survive; but it's highly unlikely that it will flourish.
3. The most important of these factors is Moxie - the energy, conviction, and determination of the founder/entrepreneur, the leader.

There are always noteworthy exceptions to rules of thumb; but the fact that they are noteworthy means that the general rules are reasonably valid.

I test business concepts proposed to me on those Four Fundamental Factors; and I encourage potential entrepreneurs to test themselves in the same manner.  Similar encouragement applies to people considering association with early stage businesses - employees, investors, strategic allies, clients.

And I always, always look first to the fire behind the eyes of the leader.  I always START WITH MOXIE.

You can test your own entrepreneurial ideas against the Four Fundamental Factors by using my simple Four Factors Self-Check.

You can also watch and listen to me talk about all this on YouTube. 

I know who grows my arugula

"Each man takes care that his neighbor shall not cheat him. But a day comes when he begins to care that he does not cheat his neighbor. Then all goes well -- he has changed his market-cart into a chariot of the sun."  

    Ralph Waldo Emerson

Gwynn Hamilton and Robert Webster grow food for my family.  They garden at the Stonecrop Farm in Newport, Virginia, with the faithful assistance of their five-year-old daughter, Zoe. 

We always stop at their booth at the Blacksburg Farmers' Market.  They know our names, remember what we like, and apologize when we arrive late and they have sold out of our favorite, arugula.  But they definitely are not our private gardeners.  It's quite clear even to a casual observer that they genuinely care about all their customers, not just us.  And to reciprocate that caring, by being a friendly and faithful repeat buyer, just comes naturally.

What if each business relationship had that depth, that warmth?  World peace would be within our reach.  I'm sure of it.  Swords would become plowshares, no question.

Every entrepreneur makes a choice as to how to relate to clients.  The seller/buyer interaction is part of each business's Magic formula.  And I am convinced that people prefer to do business with other people, rather than with machines or systems.  There is intrinsic human value in community, even when the individual relationships are digitally enhanced.

It's not easy for a global company to create local relationships.  But it's not impossible.  Wal-Mart is not required to employ smiling greeters.  Rackspace is not required to provide "fanatical support" from pop-up, human "rackers."

So, I offer you this simple strategic consideration for 2010.

As the New Year emerges, fresh life rising from the composted past, I challenge myself, and you as well, to seize the opportunity to beat at least one sword into a plowshare, to change one humble market-cart into a warm and radiant chariot of the sun.

I'm not losing. I'm learning.

"Life is like playing a violin in public and learning the instrument as one goes on."

    Samuel Butler

Breaking news.  You heard it here first!  Unskilled violinists don't receive much applause.  And off-target products and services don't sell. 

So, what happens to the aspiring violinist who cannot move his audience?  What happens to the entrepreneur whose first product flops?

My son is a musician.  His career choice has exposed me to all sorts of people and situations that would have otherwise been forever hidden from me.  A few years ago, we were visiting a college as part of the audition tour required of every music major.  During such visits the aspiring performer is interviewed and then demonstrates his skill for the professors who will be charged with transforming him into a reliable applause generator.  The parents wait in the hall.

The halls of these music institutes are festooned with all sorts of flashy concert posters and album ads, of course.  But they are also home to a wealth of inspirational materials.  Here is a keeper.

"Amateurs practice until they get it right.  Professionals practice until they can't get it wrong."

Wannabee entrepreneurs (and musicians) try only until they hit the first serious obstacle.  Then they lose, precisely because they believe they are losing. 

Winners keep at it until they succeed.  They win because they understand that they are not losing, but that they are learning.

For a scientist, an experiment that does not confirm the hypothesis is not a failure.  It is a useful stepping stone to a fresh hypothesis.  For a musician, a bad review provides clarity on how the performance can be improved.  For an entrepreneur, a rejected product is a clear message about the true needs of the marketplace.

Product acceptance is disappointing?  You have two choices.  Declare defeat and go find a job.  Or address the current biggest complaint and try again.  Then repeat the cycle as long as your Moxie holds out.

Ultimately, you will learn so much about your Market that you can't get it wrong.  You will have mastered your Magic.

By the way, the musicians and the scientists all have Mentors.  They are built into the system.  I'm just saying...

How to eat a five hundred pound marshmallow

"Plans are only good intentions unless they immediately degenerate into hard work."

                                    Peter Drucker

The vast gorge that lies between noble intent and significant achievement is, of course, quite real, and widely documented.  Lofty goals are commonplace.  Noteworthy achievement?  Not so much.  And this is particularly true for entrepreneurs and their ambitious startup plans.

Many years ago one of my friends presented me with a clever metaphor that I have since used on a regular basis.  Speaking about one particular challenge, he said, "This is like a five hundred pound marshmallow.  I can't even get a firm grip on it, let alone eat it.  But if I chop it up into bite sized pieces, I can at least make some progress." 

It seems to me that the vast gorge between intent and achievement might be addressed in the same manner.  So - I hereby offer a simple experiment that you may perform in the comfort and security of your own office. 

How to eat a five hundred pound marshmallow...

Commit to specific, short-term, relevant actions that are obvious and powerful pre-requisites to lofty outcomes, rather than to the outcomes themselves.  Hold the outcomes in mind, of course.  But focus on the actions, one at a time.  Select one.  Complete it.  Review your situation.  Determine what the next most relevant action should be, and take it.  Repeat as needed.

Example.  Don't resolve to increase sales by $1,000,000. 

Instead, visualize your business as vibrant and prosperous, larger than it is today, with more clients, placing larger orders.  Then execute one specific, measurable, immediate, relevant action on the path to that prosperity.  Perhaps it might be to make five prospect calls today.  After those five calls are made, assess the fresh information.  The next most useful action might be to make five more calls; or it might be to compose a new introductory pitch; or it might be to lower prices by 10%.

Bonus: every time you actually complete one of those relevant actions, you get an accomplishment boost, a nice recharge for your Moxie.

So, remember the old English proverb, "If wishes were horses, beggars would ride."  Transform your vision into meaningful action.

P.S.  This system also works for New Year's Resolutions.

Startups for seniors

It's all about the Moxie!!

A recently released Kauffman Foundation study, "The Coming Entrepreneurship Boom,"  suggests that the United States might be on the cusp of a startup boom—not in spite of an aging population but because of it.  Entrepreneurship, it turns out, is not just for the young.  Colonel Sanders, after all, didn't really crank up his Kentucky Fried Chicken franchise operation until he was 65.

Drea Knufken, at Business Pundit, points out the advantages that accrue to late-life entrepreneurs; and they are significant.

Advantages of Age

    * Money – If you know you want to start a business some day, you can put away cash for ten years and fund your business yourself until you reach cash flow positive. It helps to have assets.
    * Connections – When you are 25, you don't know a lot of executives at other companies. By the time you are 40, your friends and co-workers will have switched companies, changed jobs, and moved up the corporate ladder. This gives you easier access to decision makers and the people you need to help you get your business off the ground. Many of your old friends and co-workers will be your first customers, and open doors for you in all kinds of places.
    * Wisdom – You have much more business experience to pull on. You don't have to learn or invent many of the standard processes that exist at most companies.
    * Patience – The longer you wait, the more pitches you will see. If you aren't compelled to swing at anything and everything just to try to get a hit, you can wait for that pitch that is in your sweet spot.

I often tell young people who visit me with startup ideas: I'm no smarter than I was at 20; but I have a lot more data.  And I know many, many more people.  Remember, who you know is what you know. 

So, baby boomers, if you were wondering whether your next career might be as an entrepreneur, consider the words of Alfred, Lord Tennyson, from his poem, Ulysses ...

        Come, my friends,

        'Tis not too late to seek a newer world.
        Push off, and sitting well in order smite
        The sounding furrows; for my purpose holds
        To sail beyond the sunset, and the baths
        Of all the western stars, until I die.

        Tho' much is taken, much abides; and though
        We are not now that strength which in old days
        Moved earth and heaven; that which we are, we are;
        One equal temper of heroic hearts,
        Made weak by time and fate, but strong in will
        To strive, to seek, to find, and not to yield.

It really is all about the Moxie.

Heisenberg Compensators - On Sale NOW!

"The future is uncertain... but this uncertainty is at the very heart of human creativity."

    Ilya Prigogine

Three common traits of successful entrepreneurs are: 1) the ability to accept uncertainty; 2) a voracious appetite for additional information; and 3) creativity.  Business winners are seldom rigid, except in their tight focus on their vision.  They are generally committed to action, but seldom to a particular action.  Instead, they devise and select actions that are appropriate to each new situation as the world evolves about them.  And they learn from their mistakes.

My friend Matt told me that we would save a lot of time and trouble if we simply told all fresh entrepreneurs just to go out and buy Heisenberg Compensators.  That would remove all the risk from their startup ventures, he said.  They would all get rich, and fast.

I agreed with Matt, then ran to my computer to find out what in the world he was talking about.

In case you are uninitiated, like me, it turns out that a Heisenberg Compensator is a critical component of the Star Trek transporter system.  It adjusts for the fact that we cannot know both the location and the momentum of a sub-atomic particle simultaneously (Heisenberg's Uncertainty Principle). Without the compensator, the objects or people being transported would arrive scrambled at best, and more likely not at all. 

From my point of view, a successful entrepreneur is, in fact, a walking, talking Heisenberg Compensator, constantly assessing the locations and directions of the various components of his business world and making tiny, but regular, adjustments to his action plans.  There's no need to buy one, after all, if you can be one.  Besides, late model compensators are definitely in short supply, which makes them absurdly expensive.  (I checked on Craig's List - couldn't find one anywhere.)

Learn to bend and you won't break.  Bend in just the right direction, and you'll be a huge success.

Besides, there is seldom a way simply to force a positive solution anyway.  Turning up the power on the transporter cannot remove the need for the compensator.

So, as my other friend, the Earl of Chesterfield, once said,

"Prepare yourself for the world, as the athletes used to do for their exercise; oil your mind and your manners, to give them the necessary suppleness and flexibility; strength alone will not do."
 

Success - Ten Traits Supporting Four Fundamental Factors

"Innovation is the specific instrument of entrepreneurship."

                                                                        - Peter Drucker

"I'm convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance."

                                                                        - Steve Jobs

"Success or failure of a new venture is determined very early, on the strength or weakness of only a few fundamental factors, four to be exact.  Those four factors are Moxie, Market, Magic, and Mentors."

                                                                        - Jim Flowers

Entrepreneurship definitely does not equal innovation, but they sure do complement each other in powerful ways.

Here are some behaviors/traits/skills that support innovation, according to Professors Jeff Dyer of Brigham Young University and Hal Gregersen of Insead...

• Associating - a cognitive skill that supports connections across seemingly unrelated questions, problems, or ideas.
• Questioning - an inclination to ask "what if", "why", and "why not" questions that challenge the status quo and open up the bigger picture.
• Observing - the propensity to closely observe details, particularly the details of people's behavior.
• Experimenting - regularly trying on new experiences and exploring new worlds.
• Networking - connecting with smart people who have little in common with them, but from whom they can learn.

These do not match up well with the various lists of entrepreneurial traits that pop up in online investigation of the topic.  Recurring themes in definitions of an entrepreneur include...

• Clarity - true entrepreneurs absolutely "know" where they are headed.
• Focus - successful entrepreneurs stay on task - period.
• Persistence - they refuse to give up. 
• Self-confidence - they never doubt their ability to succeed.
• Courage - they take risks that most others would not take.

These entrepreneurial traits may be applied to an innovative vision, to be sure.  Apple, for example, was both innovative and entrepreneurial.  They may also be applied, on the other hand, to a perfectly common vision, such as opening a snack bar or an auto repair shop.

My simple-minded shorthand for all the entrepreneurial traits is MOXIE.  And the innovative traits relate directly to the other three Fundamental Factors: Market, Magic, and Mentors.

Secret Revealed! How to Get What You Want...

It's really quite simple.  Not easy, not by a long stretch.  But simple, annoyingly simple.

It annoyed me anyway.  Somewhere, somehow, I came to the realization that I was faithfully following the American yuppie rule book.  I was nailing "the agenda."  Good job, nice house, two cars, wife, kids, church membership, everybody healthy.  The trouble was that I couldn't manage to feel fulfilled or contented.

So I set out to fix my life.  Getting off the agenda actually proved to be relatively easy.  It was expensive, and seriously painful; but it was easy.  Quit the job.  Get divorced.  Find some new friends.

Then reality set in.  I didn't have a fresh agenda to replace the one I had discarded.

Possibly the most challenging obstacle on the path to fulfillment and contentment is the requirement to figure out what the heck fulfillment and contentment look like.  Achievement is do-able, but the other two are elusive.  You can test my bold assertion quite easily.  Define those two terms for yourself.

If you can do it easily, I salute your unusual self-awareness.  Stop reading this post immediately.  You've already wasted some valuable time.

I see that you're still reading.  Ha!  I was right - for once anyway.

It appears to me that most people can easily name a particular near-term change that would improve their situation; but they struggle mightily with describing a situation that would qualify as ideal. 

The most common quick fix is money.  Duh.  Close, but probably second is love.  But what if you could live anywhere in the world?  Where would you choose to live?  How would you spend your days?  How would you value yourself?  What sorts of people would surround you?  What relationship would you have with each of them?  How would you dress?  What would you eat?

Too many choices!!  Too many options!!  My head hurts.  Barry Schwartz talks about this in The Paradox of Choice. Jonathan Mead offers help to the most adventurous in Reclaim Your Dreams.

Well, guess what, my friendly entrepreneur.  If you can't figure out what you want, that is precisely what you will get.  If you let your startup business take you where it wants to go, you have a rather slim chance of arriving at the world headquarters of fulfillment and contentment.

One of the most common reasons given for pursuit of entrepreneurship is the need for autonomy, the need to be in charge.  Over and over again, unfortunately, I meet people who have become slaves to the businesses that were supposed to give them freedom.  That's just plain sad.

And I suspect it's because they hadn't figured out where they really intended to go.

Four really useful habits

I'm pretty darned sure that these four things will take most anybody a long way down the road to achievement and contentment: clarity of vision, commitment to relevant action, adherence to noble principles, and focus. 

1. I try to stay in touch with what really matters. 

What really matters to me is not what other people tell me should matter.  It's what my own deepest inner voice tells me.  It's what I think about when I find myself awake in the middle of the night.  It's what I want to share with the people I love.  It's my vision of an ideal world.  It's how I want my life to work out.

2. I commit to relevant actions, not outcomes. 

I can control the actions I take.  But, except in trivial cases, I can't control the outcomes they will produce.  Life is simply too complicated.  There are too many uncontrollable outside influences.  If I arbitrarily decide that I will sell 100 widgets, I may or may not succeed.  If, on the other hand, I commit to improving the specific skills, techniques, and work habits related to selling, my effectiveness will definitely increase.  If I can master the details, I will then sell as many widgets as the marketplace permits me to sell.

3. I constantly test my vision and my actions against my fundamental principles. 

I assume you have principles.  I do.  Most people appear to have at least a few.  Some wise person once told me this.  "If you can't talk about your vision with your grandmother, think it over just one more time.  If you wouldn't want your action to appear on national television, reconsider your commitment to that action."

4. I do my best to stay focused. 

Just say no to more good ideas!!  I like Jonathan Mead's take on this.  He says that people who can ignore their good ideas "don’t chase the stuff that seems to have potential, but doesn’t really matter. They only do the stuff they must do: what they’re insanely passionate about and what they were born to do."  Focus also preserves a person's precious supply of MOXIE.  That's a big, big deal for an entrepreneur trying to succeed in a risky startup situation.

Goal-setting - the ugly secret

Inherent in every goal is permission to stop trying.

This is particularly dangerous in competitive environments - business, for example.  When specific, static targets are used to define the meaning of the enterprise, outcomes tend to be less than optimal, particularly for start-ups. Why?  Because, according to Gene Bellinger, as we near our goals most of us simply do not try as hard.  Our motivation wanes.  He uses systems theory to explain the phenomenon.  I prefer simple metaphors.  I use sports.

In 2006, Phil Mickelson led the U.S. Open by a stroke as he stepped to the 18th tee.  A par would win.  A bogey would force a playoff.  He had been playing steadily, reliably.  He was nearing his goal.  And he lost his edge.

Once focus is lost, once tension is relaxed, the door is open to the adversary.  Phil made four poor shots in a row and squandered his chance for a historical run of three grand slam wins in succession. 

In the 2007 Fiesta Bowl, upstart Boise State led Oklahoma 28-10 after 3-1/2 quarters of play.  Oklahoma sucked it up and roared back with to take the lead.  With seven seconds left to play Boise State was 50 yards out.  Oklahoma had it won.  They only had to survive one more play.  Oops.  At least they managed the tie that Phil had blown.  They didn't lose until overtime.  Oklahoma, it might be argued, played the game from a survivor mentality.  Boise State, on the other hand, played the entire game, and also the overtime, from an underdog mentality.

Many commentators have suggested that Tiger Woods plays golf as if he were trying to destroy his opponents.  His record is not perfect, of course.  No one is perfect.  But he almost never surrenders a lead.  In fact, he typically attempts to build his lead, even when logic might suggest defensive play.

Some football coaches are criticized for continuing to score against a clearly defeated opponent. 

Neither Tiger nor the football coaches want to lose their edge.  Regaining it is too difficult.  They look beyond the current game.  Relaxing and permitting sloppy play amounts to practicing mistakes, obviously a sub-optimal application of time and energy.  That's why the coaches never tell their starters to let up.  But to show good sportsmanship, they do usually send in their less skilled players.

So - what is the substitute for traditional goals?

Bellinger argues for pursuit of continuous improvement as a better model.  In industry this is called the Deming Cycle.  Vince Lombardi demanded "relentless" pursuit of perfection. (The Super Bowl trophy is named after him, by the way.)  It's not just your blogging buddy Jim Flowers arguing that traditionally conceived goals contain the seeds of eventual defeat. 

For any entrepreneur, commitment to a powerful, continuous process in support of a grand vision is far more reliable as a motivator, and as a management model.

The power of principle

"A people that values its privileges above its principles soon loses both."

             Dwight D. Eisenhower

"Back of every noble life there are principles that have fashioned it."

    George Lorimer

A few days ago I was reflecting on corporate vision statements.  At the close of that post was this sentence, "Of course, that brings me face-to-face with what-should-come-next.  But I'll tackle that one later." 

Later has arrived.

What-should-come-next simply has to be corporate principles.  At least I think so.  It turns out, however, that searching on "corporate principles" delivers only a hodge-podge of anecdotal references to specific statements by individual companies.  There is no clear evidence from the engine-of-all-knowledge that there exists a coherent sense that a business should be "principled."

"Well, well," he said sarcastically. "Isn't that a great big surprise?" 

Corporations are carefully designed to limit the personal liability of the people who own them.  The very same mechanisms that protect investors from undue business risk, also nicely protect them from inconvenient responsibilities.  When Union Carbide managed to kill thousands of people in Bhopal, India, none of its actual owners lost a single penny beyond their loss in the value of the Union Carbide shares they had purchased on the New York Stock Exchange.

Here are two examples of public statements of principle by corporations.

RTI International - Corporate Principles

As we pursue our mission of improving the human condition, we adhere to the values that have served as RTI's foundation throughout our history: integrity, excellence, innovation, respect for the individual, respect for RTI, fiscal responsibility, and objectivity.

Balfour Beatty - Guiding Principles

    * To fulfil our responsibilities to shareholders, customers, suppliers, employees and the wider community.
    * To treat all groups and individuals engaged in or affected by the business with the highest standards of integrity.
    * To conduct all aspects of our business at the highest level of excellence and professionalism and have regard to the traditions and practices of the markets in which we operate.
    * To pursue our financial performance goals without losing sight of longer term objectives or of the wider context in which our business operates.
    * To seek continuous improvement in all aspects of the way in which we operate and do business.
    * To ensure we conduct our business and make our decisions within a clear ethical framework.

Call me crazy, but I just don't believe that these go far enough.  Mentioning a clear ethical framework is good; but what, pray tell, are the specifics of that framework?

Tim Ferris, in his bestseller, The 4-Hour Work Week, speaks proudly of winning a kick-boxing championship by circumventing the spirit of the rules of the competition.  His triumph denied some other kickboxer a trophy.  Loosely-regulated financial institutions, in a frenzy born of unfettered greed, precipitated a global economic disaster.  Union Carbide killed people.  The only difference among these three events was the scale of the unfairness.

As an entrepreneur, you are preparing to launch your own company.  Perhaps you have already launched.  In either case, I encourage you to weigh in heavily on the side of broad responsibility for future corporate actions.  Here are some principles to consider, tweaked for appropriateness to the business context:

• The fundamental importance of honesty, integrity, and responsibility;
• The inherent worth and dignity of every single person;
• The importance of justice, equity, and compassion in all relationships;
• The enlightening power of a continuing, free, and responsible search for truth and meaning;
• The right and the responsibility of each individual to act in good conscience in moderating behaviors, both personal and corporate;
• Respect for the interdependent web of all existence upon which we all depend for survival.

By the way, upon reflection, I would have to say that a clear statement of principles should precede composition of a vision story.  I had the order wrong.  And this time I know what comes next - commitment.  More later.

The story of business

"Imagination is the beginning of creation. You imagine what you desire, you will what you imagine and at last you create what you will."

                                                    George Bernard Shaw

I've been trying to figure out the "corporate vision" thing. 

It's trendy.  And it certainly makes sense as a way to communicate the Motivation behind the Moxie.  But making it real, and useful, is no mean feat, I think.

Being a faithful member of the global internet community, I started my figure-it-out quest by invoking the world's favorite search engine.  That proved to be an interesting and time-consuming exercise, but not very helpful.  My wanderings turned up lots of "vision statement" references and a few "methods" for creating them - both corporate and personal.  But I did not locate a definitive path to a tight grip on the process or on the presumed outcome of the process.

Abandoning the search engine method of intellectual inquiry, I decided to test a pre-electronic alternative.  Reluctantly, I admit, I concluded that my only hope was to turn away from the screen and to think about it, alone.

Upon reflection, it now seems to me that a presumed requirement for a good vision statement is verbal conciseness.  It has to be tweetable. That obviously places arbitrary boundaries on the opportunity to deliver a rich description of a preferred future state. The greatest writers of all time have routinely agonized over the inadequacy of even the most well-crafted prose to capture the fullness of what can be observed, let alone what might be imagined. Where, therefore, could an entrepreneur possibly obtain such linguistic wizardry as might evoke corporate inspiration in only 140 characters? 

Where, indeed?

So - now I'm thinking with my keyboard.  Somebody once told me that extroverts often think with their mouths.  I guess a keyboard qualifies as a mouth, of sorts.  This is fun, actually.

Suppose I get crazy and switch from "statements" of vision to "stories" of vision.  If I were to wake up inside my company three years from now, what would I see?  A vision, after all, is what I see.  Is it OK to add what I would hear, what I would feel?  My sources say yes. To tell the story of my future I'll still have to write excellent prose, but at least I can break the single sentence barrier.

OK, I'll search again - this time on "corporate stories." 

Visualize me typing madly right now.  I think I may be on to something, and I really want to see the outcome of my search.

Bingo!!  Success on the first un-sponsored entry.  And I quote...

Help me hire a hit man...

Reads the sign of a panhandler outside a subway station in San Francisco. Apparently, she does quite well.

In Olympia, Washington, a guy gets similar results with motorists by holding up a placard that says: "Why lie? I need a beer."

A man in Times Square offers this only-in-New-York service: "Tell me off. One dollar."*

These three entrepreneurial panhandlers succeed (in their own way) because they know something many business people have yet to discover: Nothing's more powerful than a good story. 

Bingo #2!!  And I quote...

Reading Bruce Temkin's "Use Storytelling To Define Your Culture," I found this article useful because Bruce suggests telling stories about corporate achievements will have more success in cementing employee passion for customer service than management telling people not to do something. I believe stories are so important because when attempting to motivate people to follow an idea its less about pure facts, and more about how people relate to those facts.

I, Jim Flowers, am now a happy man.  I can post this little dissertation feeling comfortable that I have, at least for myself, moved past the "vision statement" roadblock.

Of course, that brings me face-to-face with what-should-come-next.  But I'll tackle that one later.

Four hour work week - NOT

"Opportunity is missed by most people because it is dressed in overalls and looks like work."                                                                            

                                                                             Thomas A. Edison

It's not that I don't believe in the possibility of a four hour work week.  It's that I wouldn't want one.

There is certainly pleasure to be found in self-indulgence, but very little contentment. Indulgence, as many wise people have noted, tends to breed dis-content.  Our human capacity for wanting more, if left unchecked by purposeful living, seems almost limitless.

But, as Maxwell Maltz pointed out, "We find no real satisfaction or happiness in life without obstacles to conquer and goals to achieve."  

The real opportunity, in my opinion, is the chance to do something that matters.  For the entrepreneur that means addressing a client's need, in a powerful, direct, and unique manner.  It is the privilege of making Magic in a meaningful Market.

The entrepreneurs I know seldom want to succeed in order to retire.  They want to succeed in order to play the game again. 

And, just to be really philosophical, I'll quote Jonathon Mead.

"Work is sacred" he says.  "Work is giving yourself. It’s creative self-expression. It’s opening your heart and providing value to others. It’s exchanging a part of yourself with someone else. It’s a possibility for you to make a difference in the world."

That difference, and its personal meaning for us, is where our Moxie comes from.

Intelligent audacity

"You sort of start thinking anything's possible if you've got enough nerve."   

J. K. Rowling, Harry Potter and the Order of the Phoenix

"Hearing voices no one else can hear isn't a good sign, even in the wizarding world."

J. K. Rowling, Harry Potter and The Chamber of Secrets

A few days ago, a good friend of mine shared his take on Moxie.  He agreed that energy, pep, determination, and perseverance were all part of the formula.  But to him, two more words belonged on the list.  Successful entrepreneurs, he said, demonstrate "intelligent audacity."

Intelligent audacity.

In Potter terms, a successful entrepreneur (often a wizard of a sort), having an abundance of nerve, will often believe that "anything's possible."  That's audacity.  But it is also vital for that entrepreneur to stay in touch with reality.  That's intelligent, obviously.  Because as Old Lodge Skins said in the movie Little Big Man, "Sometimes the Magic works.  Sometimes it doesn't."

So, as you prepare to startup your business, step back for a moment.  Is your plan audacious?  Probably, I would guess.  Is it also intelligent?  Or are you hearing voices no one else can hear?

Hmmmm.

Ignorance is risk

"Ignorance gives one a large range of probabilities."

                      George Eliot

"Nothing is worse than active ignorance."

                                             Johann Wolfgang von Goethe

"Never let your persistence and passion turn into stubbornness and ignorance."            

                                Anthony J. D'Angelo

To be an entrepreneur is, by definition, to risk.  Risk management is all about reducing uncertainty, somehow minimizing the number of possible outcomes.  There is no greater risk, therefore, than to take aggressive action in the face of serious uncertainty.

To translate that into the terms I commonly use in this blog - don't let your Moxie override your Mastery of Market and Magic.

Here's a simple test for the level of ignorance-risk inherent in your startup plan. 

• Are you entering a Market in which you have never done business?  Yes or No.

• Is your Magic (product or service) something truly new to the world?  Yes or No.

"Yes" answers suggest that your Mastery of the Market or the Magic are probably questionable.  Two "yes" answers suggests very high risk.  One "yes" suggests more moderate risk. 

Good news!  Ignorance can be corrected, starting with location and recruitment of Mentors who have deep personal knowledge of your Market and/or your Magic.