Just as a precursor, this is something that has been on my mind for quite some time. At almost every networking event I visit and every presentation I do, this topic is mentioned. Everyone understands the position the economy is in right now and things just aren't looking real good, right? Right. But does that mean we should be worried, blame it on the government, and/or continue to bitch? Nope. Quite frankly, I am tired of hearing people blame this situation on the government, banks, and failing iconic American companies (heck, I got my Pontiac G8 before production stopped so I'm happy).
One of my favorite and most reverberated quotes is from Mr. Einstein himself. "In the middle of every difficulty lies opportunity." I believe that we need to realize that the recession that we are currently in is nothing more then a necessary hiccup to get things back on track. Time to "re-invent" the things that WE messed up (good catch phrase GM). It is time for things to change (sorry if I sound like Obama). These transition areas are breeding grounds for opportunity, innovation, creativity, and success stories. Is it just me or does this sound like a modern definition of entrepreneurship? The podcast embedded below here is from Steve Ballmer (CEO of Microsoft) describes this in good detail. I also wanted to note that a webinar that I took part of today with Guy Kawasaki also had some very similar dialogue.
I feel that it is time to make a move, time to realize the 'pains' of the world and find ways to contribute to this re-invention. It is time to quit crying for lower taxes and instead include them as variables to overcome on your path to success. Let's stop complaining about the economy over a chilled beer on the weekends and start looking for ways to use the current situation to our advantage. The latter may require a bit more chilled beer. Take a step back, grab the post-it notepad on your desk, and write down the three things that YOU feel have contributed to our current economic situation. Go get a 6-pack of Landshark (great stuff) and discuss with a group on which of those three things you could provide a solution to. Consider yourself a world consultant.
Here are some quick examples of industries that have exploded because of the current economic situation (Source):
Internet Services and Retailing
From an entrepreneurs standpoint, here are six things that I feel need to change (don't take offense):
Think Outside the Box - Stir your mind with thoughts of innovation and creativity. Take an art class or try to learn to polka. Or, if you are like me, refer to my earlier statement on the acquisition of Landshark and a group of friends. Spark some creativity and imagination and start to think of ways to solve problems instead of complain about them.
Stop Comlpaining About Wal-Mart - I am truly exhausted with hearing the news media and friends complaining about how evil Wal-Mart is. The guys are doing some great things with the advancement of technology, education, and energy. They are taking some great social initiatives and have hopes to change the world. More importantly for this blog post it is important to look at Wal-Mart to see 'how' they did it. One answer. Damn smart business strategies. They have utilized modern technology, streamlined the supply-chain, and brought convenience to an entire new level. Take a look at some of the things they have done to increase efficiency. It is surprisingly inexpensive (explained below) to match their technology in a small-town clothing store or pharmacy. Also, dont forget to take a look at what they haven't done as this is what leaves opportunity for the small-town clothing store or pharmacy to differentiate. What havent they done? Customer service, knowledgable sales staff, deliveries, and provide quality products. Just to name a few.
Go Electronic - Yes, I am a technology consultant (and a computer engineer) so I have to put this in here. There are to many small-town business owners that are just to damn stubborn to change. "In the face of an obstacle which is impossible to overcome, stubbornness is stupid" -Simone de Beauvoir. It isn't 1982 anymore and if you don't want to take credit cards then it's time to retire. If you don't want to invest in a POS system and prefer penciling orders on yellow carbon paper from Wal-Mart (irony?) it is time to close shop. Finally, if you don't want to have a functional web presence it is time to do some market research on how many people still use phone books. Taking advantage of what technology has to offer can put you on even ground with Wal-Mart in that arena. Then, it makes it that much easier to establish your differntiation point and succeed.
Accept Globalization - The world is flat, Thomas Friedman hit it right on the money in 2005. It is time to stop with the naivety of complaining about outsourcing and start using it to your advantage. The term has been glued to a negative connotation for years (especially to the baby-boomer generation). What some don't understand is that outsourcing can be profitable for both the service provider, yourself, and value-added for your customers. So stop blaming the job loss on outsourcing because it is inevitably going to be a part of our future and it is not a bad thing! Outsourcing can also be of very high quality if you find the right firm. Bouncehost takes advantage of a design firm from India on some of its web projects, the company response time and quality is better than that of any US applicant we had and they are billing at less then $12/hr.
Don't Rely on Government - Don't RELY SOLELY on grant money or bailout funds to get your business started or moving in the next direction. If the idea isn't good enough to work without grant money then it probably will fail with the grant money. If you have a great idea and the money is there contact your local small business development center for assistance in finding the cash.
Cash Flow is King - Most of the businesses that are failing today are failing because of cash-flow issues. Everything from large banks and financial institutions to small-town software development companies. My advice, don't be a bank. Shorten payment terms and up penalties for late payments. Provide incentives and NET terms for customers that pay quick. Take advantage of longer payment cycles by using credit cards and try to extend payment terms with suppliers if necessary. Timothy Ferriss hits on the importance of cash flow in my favorite book "The Four Hour Work Week".
So go out and take these tips to make a difference! Expect some more elaboration on Wal-Mart and Globalization in the near future. Please feel free to comment on this blog post and I will do my best to respond quickly and fairly! Criticism is welcome.