4 Tips For The Successful Businessman

I have a passion for the bald eagle or Haliaeetus Leucocephalus
according to his scientific name. I have this passion as long as
I can remember. But it is not a logical passion. I am Dutch and
a passion for a bird of prey that is common in The Netherlands
would be more obvious. But life is full of inexplicable surprises
and left me with this passion for the bald eagle, the national
symbol of the United States of America. I have seen the
eagles only once in my life in their natural habitat and that
was during a holiday in British Columbia in Canada.

When I read about bald eagles and about the way they live, I
always start thinking about what a businessman can learn from
them in order to become successful and that is what this article
is about.

1. Vision

Bald eagles are birds that can often be found on very high
altitudes. There they soar and with their very sharp eyesight
they have a clear view on the world below them and especially
on the prey they want to catch; fish, that is what they like
most.They can see the milky white spot in the water from a
distance of many miles. In high places they build their nests.
On a rock, on the top of a tree but always on a spot where they
have a good view on the world that surrounds them. And from
their castle they see what is happening around them and that
gives security.

The businessman should also have a clear view on what is
happening in the market. From very far he should recognize his
potential customers and "attack" them at the right moment. At
the same time he should be aware of the dangers that surround
him, anticipate, absorb the environment and be prepared to act
immediately.

2. Knowledge

Bald eagles are confined to their territories. With the seasons
some migrate but you find bald eagles only in a specific habitat
namely forests, mountains and near sea and rivers. You won't
find them in the desert. In their habitat they know what to do,
where they can find prey and which dangers surround them. By
instinct and by learning they have knowledge about the way they
have to conduct their lives and about how they have to behave
in this habitat. They will never go beyond the limitations of this
frame work. If they do, they die.

This holds a lesson for the businessman. He should know
everything about his business and when I say everything, I mean
everything. He should know all about the products he sells from
beginning to end, every detail should be an open book to him.
He can never be surprised with questions on which he has no
answers. He should know about marketing techniques, the
position and plans of competitors etc., etc. And if he doesn't
possess this knowledge by nature, he has to learn it.

3. Enough is enough

When Bald Eagles catch prey, they will catch only one fish at a
time. It is not possible for them to catch more. But they know
precisely how to catch this one fish. Their flying skills, their
strong talons and their eyesight are extremely well developed
and fit for the job. Almost every attempt to catch a prey is
successful.

This phenomenom also holds a wise lesson for the businessman.
He has to restrict himself to a number of products he can handle
and products that matches his skills and abilities. To stay in
the animal world: if you are a cow don't try to jump fences like
a horse. People will only laugh at you. It is better to sell one
product very well than ten without a satisfying result.

4. Courage

Bald eagles mate for life and they are absolutely loyal to each
other. From high altitudes the two birds tumble down in a
dangerous free fall. Mocking the laws of gravity they unite.
Only just above the tree tops they separate and fly wing by wing
to the nest. This spectacular show requires great courage. A
businessman also needs courage to be successful. He has to make
decisions about difficult and uncertain subjects. And he also
needs to know when to stop his free fall. Having courage to make
difficult decisions is not synonymous for being reckless. A
decision that leads to disaster is not a decision, but a wild
guess.

You see....the businessman can learn a great deal from this
majestic bird that embodies not only beauty, strength and
freedom but that possesses also the essential conditions and
abilities to survive.

The beginning businessman as well, who is maybe starting his
business in great uncertainty about the future, can learn from
the bald eagle:

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How to become a successful businessman

So you want to engage in business, but aren't quite sure where to begin. Don't worry; here are some practical ways to begin your journey toward becoming a successful businessman:

Put your plan into writing. You may have so many different business ideas, but until you put them into writing and create a business plan of your chosen idea, chances are those ideas will simply remain theoretical. By creating a business plan you will see clearly for yourself such important details as:

• The Background.
  1. Your company's core mission - what your company will be all about
  2. A description of your products /services

• The Operations.
  1. Your proposed manner of implementation
  2. The systems you will need
  3. Your logistics

• The Financial Plans.
  1. Where the funding will be derived from
  2. Cost - benefit analysis
  3. The projected costs of putting up the business
  4. Your estimates at how much profit you will generate after about 5 months of operation

Remember, your business plan at this point does not have to follow a specific format. You just need to see for yourself what you need to prepare and plan for in order to bring your business to reality, and whether or not it is realistic and workable.

Network and study the workings within the industry. It's a good move to get to know as many players within the same industry as you can. Why? This enables you to gain access on insider information that could make your quest into business smoother than if you had to learn all that information yourself. For example, you could ask fellow entrepreneurs about the hidden costs that starting up the business could entail; the peak months of operation where you could expect the most customers; the trade fairs that occur which you could participate in for advertising purposes. You may experience other benefits such as discounts from suppliers and advertisers, knowledge of better systems for implementing the business processes, and better knowledge of the client base. Remember, knowledge and information can come in abundance just by being in the loop.

Be resourceful. It's important to be resourceful so you could take advantage of available and cost-effective means to effectively boost your business. For example, instead of allotting a huge bulk of your budget to advertising, you could opt to promote your business using low-cost methods such as posting ads in the Internet. Remember, a good businessman is creative in finding better ways the business can operate.

Believe in your company. Start by being passionate about the product or service that your company is offering. For example, if you are very interested in teaching then perhaps you could put up a tutorial center. If you love to bake then consider putting up a bakeshop. The point is you should not put up a business whose products or services you know nothing about.

That being said, you have to sincerely believe that your clients would do good in patronizing your company. Make sure though that you do continuously develop your product, services and systems so it would cater to the needs of your target clients. If you genuinely believe in your company, you will be motivated to promote it, improve it and to let it live a long life.

Be realistic. It's very rare for a company to grow overnight. You can expect losses before enjoying profits. You can even do well to expect periods of loss after some stages of gain. As long as you set realistic expectations and you prepare your business as well as possible for the "worst case" scenario, then you may be one step further in ensuring your business' longevity.

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Business Performance Management Cycle within Manufacturing Model

Fortunately for the novice manager, there is a business performance cycle which can act as a framework. It is the blank canvass on which the manager can imprint the development of the business. It also provides parameters through which one examines the day to day activities of the company.

For the purposes of convenience we will describe the mode that essentially looks at the manufacturing model. This model will vary slightly with those within specific service industries but it gives a good example of the progression of the business performance management project.

It assumes that there are several major activities in the organization which include designing new products, creating models of the potential products, the actual manufacture of those products, and a review of the processes and finally optimizing the benefits of the product line.

At the design stage a concept will be created to resolve a problem. Performance management is there to ensure that that concept adequately meets the needs that have been expressed and is a viable proposition. This process will require quite extension consultation and managers should not be surprised if they have to go back to the drawing board over and over again. Logic suggests that it is better to take time planning than to have an inappropriate product.

The next stage is to translate that concept into a model. Performance management will have a role to play here in terms of ensuring that the prototypes accurately match the agreed conception so that any problems can be resolved at this stage. The model can then be tested against various stringent criteria to ascertain whether it can truly cope with any variables that are expected. Where the prototype is not accurate, the problems with the design will be lost in translation.

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Key Business Metrics-2-

Fred Wilson made a post at http://www.avc.com/a_vc/2010/04/key-business-metrics.html a few days ago about how companies should be tracking and publishing their key business metrics internally that got me thinking at both a conceptual and a "why Easy Insight matters for this" level about that topic. We have our functionality around KPIs (Key Performance Indicators) that enables users to create scorecards of key business metrics, with default sets of KPIs created for the connections you establish--Basecamp, Google Analytics, and so on.

What we haven't really delved into is that set of 4-6 "big metrics" that apply across the entire business...our typical scorecards to this point have been more along the lines of a Marketing scorecard, a Sales scorecard, and so on. Trying to boil things down into 4-6 metrics ended up as an interesting thought exercise for me--in the case of our internal metrics, I came up with this list:

1) # of Unique Visitors to the Application in Time Period
2) # of Distinct Users Active Within the System in Time Period
3) Expectation Adjusted Dollars in the Pipeline
4) Revenue Received in Time Period
5) Todo Items Completed in Time Period

The time period's a bit hazy for me at the moment, probably ranging from 7 days for #2 to 90 days for #4. From there, we can establish the connections to the underlying reports that will help analyze those metrics--identifying conversion rates on visitors from different sources, figuring out what may have helped produce an active user, and so on. I'll be exploring this concept a little more with future blog posts, but wanted to just get anyone else's thoughts at a higher level around those numbers. If you had to define 4-6 metrics for your business, what would they be?

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Business Management - Personnel Selection

If your business will be large enough to require outside help, an important responsibility will be the selection and training of one or more employees. You may start out with family members or business partners to help you. But if the business grows - as you hope it will - the time will come when you must select and train personnel.

Careful choice of personnel is essential. To select the right employees determine beforehand what you want each one to do.

Then look for applicants to fill these particular needs. In a small business you will need flexible employees who can shift from task to task as required. Include this in the description of the jobs you wish to fill. At the same time, look ahead and plan your hiring to assure an organization of individuals capable of performing every essential function. In a retail store, a salesperson may also do stockkeeping or bookkeeping at the outset, but as the business grows you will need sales people, stockkeepers and bookkeepers.

Once the job descriptions are written, line up applicants from whom to make a selection. Do not be swayed by customers who may suggest relatives. If the applicant does not succeed, you may lose a customer as well as an employee.

Some sources of possible new employees are:

• Recommendations by friends, business acquaintances.
• Employment agencies.
• Placement bureaus of high schools, business schools, and colleges.
• Trade and industrial associations.
• Help-wanted ads in local newspapers.

Your next task is to screen want ad responses and/or application forms sent by employment agencies. Some applicants will be eliminated sight unseen. For each of the others, the application form or letter will serve as a basis for the interview which should be conducted in private. Put the applicant at ease by describing your business in general and the job in particular. Once you have done this, encourage the applicant to talk. Selecting the right person is extremely important.

Ask your questions carefully to find out everything about the applicant that is pertinent to the job.
References are a must, and should be checked before making a final decision. Check through a personal visit or a phone call directly to the applicant's immediate former supervisor, if possible. Verify that the information given you is correct. Consider, with judgment, any negative comments you hear and what is not said.

Checking references can bring to light significant information which may save you money and future inconvenience.

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Business Management - Record Keeping

The keeping of adequate records cannot be stressed too much. Study after study shows that many failures can be attributed to inadequate records or the owner's failure to use what information was available to him. Without records, the businessperson cannot see in advance which way the business is going. Up-to-date records may forecast impending disaster, forewarning you to take steps to avoid it. While extra work is required to keep an adequate set of records, you will be more than repaid for the effort and expense.

If you are not prepared to keep adequate records - or have someone keep them for you - you should not try to operate a small business. At a minimum, records are needed to substantiate:

• Your returns under tax laws, including income tax and social security laws;
• Your request for credit from equipment manufacturers or a loan from a bank;
• Your claims about the business, should you wish to sell it.

But most important, you need them to run your business successfully and to increase your profits. With an adequate. yet simple, bookkeeping system you can answer such questions as:

• How much business am I doing?
• What are my expenses? Which appear to be too high? What is my gross profit margin? My net profit?
• How much am I collecting on my charge business?
• What is the condition of my working capital?
• How much cash do I have on hand? How much in the bank? How much do I owe my suppliers?
• What is my net worth? That is, what is the value of my ownership of the business?
• What are the trends in my receipts, expenses, profits, and net worth? Is my financial position improving or growing worse? How do my assets compare with what I owe?
• What is the percentage of return on my investment?
• How many cents out of each dollar of sales are net profit?

Answer these and other questions by preparing and studying balance sheets and profit-and-loss statements. To do this, it is important that you record information about transactions as they occur. Keep this data in a detailed and orderly fashion and you will be able to answer the above questions. You will also have the answers to such other vital questions about your business as: What products or services do my customers like best? Next best? Not at all? Do I carry the merchandise most often requested? Am I qualified to render the services they demand most? How many of my charge customers are slow payers? Shall I switch to cash only, or use a credit card charge plan?

The kind of records and how many you need depends on your particular operation. A boy selling newspapers part time each day does not need inventory records. He buys and sells his entire stock each day. But shoe store or dress shop operators will soon find they cannot keep necessary inventory information in their heads.

Below is a list of records, grouped according to their use. No business will need them all. You may need only a few. As a matter of fact, you should not maintain a record without answering these three questions: (1) How will this record be used? (2) How important is the information likely to be? (3) Is the information available elsewhere in an equally accessible form?

The following list may call your attention to records you can use to great advantage:

• Inventory and Purchasing Records provide facts to help with buying and selling
• Inventory Control Record
• Item Perpetual Inventory Record
• Model Stock Plan
• Out-of-Stock Sheet
• Open-To-Buy Record
• Purchase Order File
• Open To Purchase Order File
• Supplier File
• Returned Goods File
• Price Change Book
• Accounts Payable Ledger
• Sales Records to help determine sales trends
• Individual Sales Transactions
• Summary of Daily Sales
• Sales Plan
• Sales Promotion Plan
• Cash Records to show what is happening to cash.
• Daily Cash Reconciliation
• Cash Receipts Journal
• Cash Disbursements Journal
• Bank Reconciliation
• Credit Records show who owes you money and whether they are paying on time.
• Charge Account Application
• Accounts Receivable Ledger
• Accounts Receivable Aging List
• Employee Records show legally required information and information helpful in the efficient management of personnel.
• Employee Earnings and Amounts Withheld
• Employees' Expense Allowances
• Employment Applications
• Record of Changes in Rate of Pay
• Record of Reasons for Termination of Employment Employee Benefits Record
• Job Descriptions
• Crucial Incidents Record
• Fixtures and Property Records list facts needed for taking depreciation allowances and for insurance coverage and claims.
• Equipment Record
• Insurance Register
• Bookkeeping Records, in addition to some of the above, are needed if you use a double-entry bookkeeping system.
• General Journal
• General Ledger

For efficient business operation, use information from records to keep inventory stock in line with sales, to watch trends, and for tax purposes. Use records to plan. A well thought-out business plan as a guide will strengthen your chances for success.

A record showing the data for your business plan is the budget. Work up a budget to help you determine just how much increase in profit is reasonably within your reach. The budget will answer such questions as: What sales will be needed to achieve my desired profit? What fixed expenses will be necessary to support these sales? What variable expenses will be incurred? A budget enables you to set a goal and determine what to do in order to reach it.

Compare your budget periodically with actual operations figures. With effective records you can do this. Then, where discrepancies show up you can take corrective action before it is too late. The right decisions for the right corrective action will depend upon your knowledge of management techniques in buying, pricing, selling, selecting and training personnel, and handling other management problems.

You probably are thinking you can hire a bookkeeper or an accountant to handle the record keeping for you. Yes, you can.
But remember two very important facts:

• Provide the accountant with accurate input. If you buy something and don't record the amount in your business checkbook, the accountant can't enter it. If you sell something for cash and don't record it, the accountant won't know about it. The records the accountant prepares will be no better than the information you provide.
• Use the records to make decisions. If you went to a physician and he told you you were ill and needed certain medicine to get well, you would follow his advice. If you pay an accountant and he tells you your sales are down this year, don't hide your head in the sand and pretend the problem will go away. It won't.

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Business Management - Selling

Whether you operate a factory, wholesale outlet, retail store, service shop, or are a contractor, you will have to sell. No matter how good your product is, no matter what consumers think of it, you must sell to survive.

Direct selling methods are through personal sales efforts, advertising and, for many businesses, display - including the packaging and styling of the product itself - in windows, in the establishment, or both. Establishing a good reputation with the general public through courtesy and special services is an indirect method of selling. While the latter should never be neglected, this brief discussion will be confined to direct selling methods.

To establish your business on a firm footing requires a great deal of aggressive personal selling. You may have established competition to overcome. Or, if your idea is new with little or no competition, you have the extra problem of convincing people of the value of the new idea. Personal selling work is almost always necessary to accomplish this. If you are not a good salesperson, seek an employee or associate who is.

A second way to build sales is by advertising. This may be done through newspapers, shopping papers, the yellow pages section of the telephone directory, and other published periodicals; radio and television; handbills, and direct mail. The media you select, as well as the message and style of presentation, will depend upon the particular customers you wish to reach. Plan and prepare advertising carefully, or it will be ineffective. Most media will be able to describe the characteristics of their audience (readers, listeners, etc.). Since your initial planning described the characteristics of your potential customers, you want to match these characteristics with the media audience. If you are selling expensive jewelry, don't advertise in high school newspapers. If you repair bicycles, you probably should. Advertising can be very expensive. It is wise to place a limit upon an amount to spend, then stay within that limit. To help you in determining how much to spend, study the operating ratios of similar businesses. Media advertising salespeople will help you plan and even prepare advertisements for you. Be sure to tell them your budget limitations.

A third method of stimulating sales is effective displays both in your place of business and outside it. If you have had no previous experience in display work, you will want to study the subject or turn the task over to someone else. Observe displays of other businesses and read books, trade magazines, and the literature supplied by equipment manufacturers. It may be wise to hire a display expert for your opening display and special events, or you may obtain the services of one on a part-time basis. Much depends on your type of business and what it requires. The proper amount and types of selling effort to use vary from business to business and from owner to owner. Some businesses prosper with low-key sales efforts. Others, like the used-car lots, thrive on aggressive, hoop-la promotions. In any event, the importance of effective selling cannot be over-emphasized.

On the other hand, don't lose sight of your major objective - to make a profit. Anyone can produce a large sales volume selling dollar bills for ninety cents. But that won't last long. So keep control of your costs, and price your product carefully.

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