You have read about the tremendous potential when you divide your life’s resources into various departments – Sales & Marketing, Finance, HR and IT – as part of our Business Model of Life Framework. So if your life is your business, then you should develop the entrepreneur in you and enhance these four departments if you want to be successful. However, these four departments cannot operate successfully without an executive leader such a Chief Executive Officer who will provide the vision and the direction besides growing and managing the business. That responsibility again lies with you! It’s time that you get more business out of life.
The role of an entrepreneur or a CEO might be totally alien to you. You might never have thought of starting a business nor even have the capability of being a CEO. Relax, it’s only a one-person-company with five key roles – You, the CEO; You, the Head of Marketing; You, the Head of Finance; You, the Head of HR and You, the Head of IT. This company of yours is capable of generating at least a million dollars over your entire life span. The alternative is do nothing, and yet so many people complain that they are not doing well in life.
To begin, you need to restructure your life’s operations first and turn it into a proper business. Let’s start by getting you to think and behave like an entrepreneur.
Adopt an Entrepreneur Mindset
Consider the following questions which experts ask that you ponder before starting your own business:
• Are you independent and a self-starter?
• How well do you get along with different kinds of personalities?
• Do you have good problem solving and decision-making skills?
• How well do your organize and project manage?
• Do you have good leadership and motivational skills?
• Do you have perseverance? Is your drive strong enough? How about your health and mental stamina?
• What about your capabilities, expertise and qualifications?
• Any family issues that will affect you?
There are many reasons and rationales behind these questions. Your answers would suggest if you are ready to run your own business.
Pause for a moment and go through these questions. Were your answers favourable? If not, take note of the areas that you found yourself lacking in. These skills can be acquired, developed or trained. These same questions also apply when you are starting out the business of life whether you have started working or are mid-way through your career.
Remember, you have to develop leadership within you. If your life is boring, directionless, meaningless, uneventful, or without progress, you know there is a need to take control of your life.
If you start to think like a leader, then you would automatically feel that you have control over things and have the authority to start making changes instead of constantly blaming others for your failure and feeling helpless. In the Business of Life, thoughts become feelings which in turn can translate into action when you adopt the mentality of running your life as if it is a business! And action means better results. So you can change your life and make it better. Don't leave things to fate.
The Reluctant CEO in You
Now that you know what it takes to run a business of your own, you next need to know the job description of the Chief Executive Officer. This is the most important part of management within a company. The CEO’s main task is to implement the strategic goals and objectives of the organization. He or she is expected to give direction and leadership toward the achievement of the organization's philosophy, mission, strategy, and its annual goals and objectives. In addition to leadership, communication, project management, and decision-making skills, the CEO is expected to have the following:
• Knowledge of the daily operations
• Compliance to regulations
• Sales and marketing management experience
• Financial management and fund raising experience
So, are you up to the job? Is there a CEO in you or is the position still vacant? Are you clear on what your goals and objectives are in your life’s business? If you don’t have, starting creating them immediately. You were appointed CEO the moment you stepped into the working world.
Like it or not, you must know how to run your life’s operations effectively and play by the business rules. You will lead your life’s organizational structure supported by the four key departments - Sales and Marketing, Finance, HR and IT.
Yes, you might not be formally trained in sales and marketing. But you are going to be doing lots of selling and marketing in your life (and that’s why you have got to do a good job in managing your personal sales & marketing department). You have to decide whether you want to be a one-product company or develop multiple streams of income to grow your earnings and increase your value year on year.
While promoting what you have to offer might be something you can do easily, managing your finances could be a challenge, especially with the fact that we are not taught about personal financial management in school.
If you don't watch your bottom-line costs, your living expenses might exceed your income as you overspend or pay off your debts such as your student loans. Ironically, some of you even go further into debt by ruthlessly spending on luxuries when you get promoted or after receiving your first pay cheque. If you cannot control your spending, your operations and ultimately, your life’s business will suffer no matter how much you are making. That is the reason why you must manage your personal finance department well!
As the business head, you should also ensure that your HR department continues to grow your potential with life-long learning and that you also take care of your own welfare like your health as well as your family relationships.
In addition, have you thought of applying technology to help achieve your life's objectives? Is your IT department making you more effective and productive? Are you competent enough to use technology and innovation to promote yourself better or derive additional sources of income?
As CEO of your own life, the above considerations are important if you want to run your life’s business successfully. The future is in your hands. You make the executive decisions. And you alone are responsible for your one-man business. There is no one else to blame. The decisions you make today will affect tomorrow’s prospects. You will no doubt make many mistakes along the way. But what’s important is that you learn from them. Let 2011 be the year that you appointed a new CEO of your life’s business.
Saturday, January 8, 2011
Friday, January 7, 2011
Starting Your Working Life Can be Compared to a New Start-Up Venture
It's true. When you begin your career, you are like a new start-up with limited product offerings - or possibly even a one-product company. That's what you bring to your customer - who is in this case, your boss as well as the company you work for.
The irony is that many fresh graduates think they are in hot demand and expect high salaries. They go into the working world with this "it's all-about-me" attitude when they have little experience. Now, tell me, would a consumer pay a lot to buy an average product with no brand? Of course not. In the business of life, if we want to succeed, we must adopt a "customer-first" approach. It is not about what the company can do for you, but what you can do for the company.
Yet many corporate newbies deceive themselves into thinking that they have a fantastic career in front of them when they find a job with a reputable company and managed to get a high starting salary. But here's the bad news... not everyone gets to climb the corporate ladder. Only the best will progress to the higher echelons of the management hierarchy. It's like the world of business where statistics indicate that a large majority of new ventures are likely to fail in the first four to five years. However, for those who succeed, the possibilities are limitless.
So how do you defy the business law of gravity that drags new businesses down after a few years of operation? You need to know what pitfalls to avoid. You have got to run the business properly and focus on your customer needs! And when you fail, like most start-up ventures, learn from your mistakes but move on. Don't get disillusioned and give up. The worst thing you can do is to switch careers without giving yourself a chance for your "market" to accept you.
So new graduates out there or those who recently started working, wake up! If you want to beat the odds, you have to run your life like a business. The limited products and services you currently offer isn't going to satisfy your customer. You need to expand your offerings by continually improving what you bring to the corporate table. You'd better be really good at what you do. Or do much more and create more value. In the business world, this would mean continuously improving a product or offering a broad range of products. This is because there are tons of competition out there in the corporate jungle. You have to market and sell what you offer that differentiates from the competition!
The truth is that the better product doesn't necessarily win in the market place. There are other factors like brand loyalty, ease of use, perception of quality, etc. Similarly, in the business of life, is your boss loyal to you? Are you easy to deal with? Are you reliable and constantly deliver quality work?
And after you make the sale (when you do your job), you have got to service your customer (your boss and stakeholders) too, just the way a business does where CRM (Customer Relationship Management) is an important focus to enable up-sell and cross-sell efforts.
To grow your business venture in life, you have to constantly improve your products and services while you build a reliable brand. Otherwise, your customers will abandon you for other compelling alternatives. Following a customer-first and a customer-focused mentality will make you humble and responsive to the needs of your customers, allowing you to grow the business of being you.
Enough said - you get the message. For those of you with lots of working experience, why not share with our younger co-workers what is needed to transform their start-up venture into an established business.
The irony is that many fresh graduates think they are in hot demand and expect high salaries. They go into the working world with this "it's all-about-me" attitude when they have little experience. Now, tell me, would a consumer pay a lot to buy an average product with no brand? Of course not. In the business of life, if we want to succeed, we must adopt a "customer-first" approach. It is not about what the company can do for you, but what you can do for the company.
Yet many corporate newbies deceive themselves into thinking that they have a fantastic career in front of them when they find a job with a reputable company and managed to get a high starting salary. But here's the bad news... not everyone gets to climb the corporate ladder. Only the best will progress to the higher echelons of the management hierarchy. It's like the world of business where statistics indicate that a large majority of new ventures are likely to fail in the first four to five years. However, for those who succeed, the possibilities are limitless.
So how do you defy the business law of gravity that drags new businesses down after a few years of operation? You need to know what pitfalls to avoid. You have got to run the business properly and focus on your customer needs! And when you fail, like most start-up ventures, learn from your mistakes but move on. Don't get disillusioned and give up. The worst thing you can do is to switch careers without giving yourself a chance for your "market" to accept you.
So new graduates out there or those who recently started working, wake up! If you want to beat the odds, you have to run your life like a business. The limited products and services you currently offer isn't going to satisfy your customer. You need to expand your offerings by continually improving what you bring to the corporate table. You'd better be really good at what you do. Or do much more and create more value. In the business world, this would mean continuously improving a product or offering a broad range of products. This is because there are tons of competition out there in the corporate jungle. You have to market and sell what you offer that differentiates from the competition!
The truth is that the better product doesn't necessarily win in the market place. There are other factors like brand loyalty, ease of use, perception of quality, etc. Similarly, in the business of life, is your boss loyal to you? Are you easy to deal with? Are you reliable and constantly deliver quality work?
And after you make the sale (when you do your job), you have got to service your customer (your boss and stakeholders) too, just the way a business does where CRM (Customer Relationship Management) is an important focus to enable up-sell and cross-sell efforts.
To grow your business venture in life, you have to constantly improve your products and services while you build a reliable brand. Otherwise, your customers will abandon you for other compelling alternatives. Following a customer-first and a customer-focused mentality will make you humble and responsive to the needs of your customers, allowing you to grow the business of being you.
Enough said - you get the message. For those of you with lots of working experience, why not share with our younger co-workers what is needed to transform their start-up venture into an established business.
Thursday, January 6, 2011
What's Your Personal Brand?
Do you have a personal brand?
If you are the business, and your skill-sets are the products and services you provide (to your employer), then your personal branding is of crucial success.
Quick – go get a piece of paper.
Now imagine if a friend, family or acquaintance were to gossip about you or your name gets mentioned in a casual conversation behind your back. What would they say about you? Write down the first answer that comes to your mind. You can write it in point form or in a sentence.
So what did you write? Was it positive or negative? Did you write something like: “I am trustworthy and talented”. Or was it something like: “People say I am indecisive”.
Good for you if it is positive. You have a problem if you wrote something negative. In the business of life, the impression others have of you is your brand. Your personal brand is one of the key success factors that you should be building equity on.
Picture two similar products on a retail shelf, one with a well-known brand and the other, a house brand. Which one would you choose? The one that has the well-known brand, of course! You would perceive this product to be of better quality than the other one although it may be more expensive. And so, this is true in any business as it is in the business of life, where your employer will hire the candidate with the better personal brand.
Do You Market or Sell Yourself Consciously?
A new venture that doesn’t market its products and services is doomed to fail. How many new entrepreneurs do you know who do not promote their businesses? Very few. On the contrary, you might know many who are obsessed in promoting their offerings with every slight opportunity they are given whether it is through networking, publicity or advertising.
Interestingly, in the business of life, there are many people who do not bother about marketing themselves despite heavy competition from others who can do the same job for a lower salary. The fact is many of us do not think it is necessary at all. There are those who will tell you that they hate selling or marketing. Here’s the cruel reality: whether you are a doctor, lawyer, accountant, sales manager or a teacher, you are a mere commodity – there will always be others who can do the job just as well. You will be destined to lead ordinary lives unless you recognize the importance of personal marketing to your employers, friends and clients.
Now let's go back to the question I asked at the beginning of this blog: Do you have a personal brand, a positive one? You'd better. If not, start creating one and market yourself if you want to make it big in the business of life!
If you are the business, and your skill-sets are the products and services you provide (to your employer), then your personal branding is of crucial success.
Quick – go get a piece of paper.
Now imagine if a friend, family or acquaintance were to gossip about you or your name gets mentioned in a casual conversation behind your back. What would they say about you? Write down the first answer that comes to your mind. You can write it in point form or in a sentence.
So what did you write? Was it positive or negative? Did you write something like: “I am trustworthy and talented”. Or was it something like: “People say I am indecisive”.
Good for you if it is positive. You have a problem if you wrote something negative. In the business of life, the impression others have of you is your brand. Your personal brand is one of the key success factors that you should be building equity on.
Picture two similar products on a retail shelf, one with a well-known brand and the other, a house brand. Which one would you choose? The one that has the well-known brand, of course! You would perceive this product to be of better quality than the other one although it may be more expensive. And so, this is true in any business as it is in the business of life, where your employer will hire the candidate with the better personal brand.
Do You Market or Sell Yourself Consciously?
A new venture that doesn’t market its products and services is doomed to fail. How many new entrepreneurs do you know who do not promote their businesses? Very few. On the contrary, you might know many who are obsessed in promoting their offerings with every slight opportunity they are given whether it is through networking, publicity or advertising.
Interestingly, in the business of life, there are many people who do not bother about marketing themselves despite heavy competition from others who can do the same job for a lower salary. The fact is many of us do not think it is necessary at all. There are those who will tell you that they hate selling or marketing. Here’s the cruel reality: whether you are a doctor, lawyer, accountant, sales manager or a teacher, you are a mere commodity – there will always be others who can do the job just as well. You will be destined to lead ordinary lives unless you recognize the importance of personal marketing to your employers, friends and clients.
Now let's go back to the question I asked at the beginning of this blog: Do you have a personal brand, a positive one? You'd better. If not, start creating one and market yourself if you want to make it big in the business of life!
Wednesday, January 5, 2011
What You Say Tells a Story About the Business of YOUR Life
Have you heard any of the following remarks at one time or other. Perhaps you yourself have made these remarks or something similar:
Let's look at these remarks in a little more detail...
“I am no good in selling or marketing.”
If you often make this remark, this is an indication that in the business of life, your Sales & Marketing department is not doing its job. If you are not selling your abilities, then you will not be noticed at all, no matter how good you are in your work. Realize that every day, you are selling something, whether it is convincing your project management team of the viability of your recommendation, selling to your clients and customers, or even doing a presentation. You need to have a sales target with goals that you can work towards. In addition, if you do not address the needs and objectives of your boss – which is what marketing is all about – you are unlikely to make an impact in your organization, depriving you of your long awaited promotion. You should be selling him ideas and showing your value instead of doing tasks that are unimportant and irrelevant.
“I am terrible at communications.”
Communication is important in business as it is in everyday life. Your inability to communicate hinders your ability to do your job effectively and might slow down your career progression. It can be as simple as being able to present to a group of people.
Public relations, a key function in every business, is about building a good relationship with the press so that what is written is positive and this creates a positive perception of the company. In the same way, if you ignore the PR for your own business of life and neglect this department in you, you cannot shape your boss’ or management’s opinion in your favour. And you will not be able to build goodwill for yourself. PR in the business of life could mean a simple gesture of paying a compliment to your boss or colleagues (when it is due), doing more than what your job requires you to do, or even being a trusted advisor in your area of expertise.
“I am in constant debt.”
There are two kinds of debt – good and bad debt. Good debt refers to loans borrowed against assets (which can grow) that you acquire while bad debt refers to credit card debts and money you have borrowed to buy things for leisure or pleasure. When you incur lots of bad debt, there’s cause to be concerned. You would have a serious financial problem and it indicates that this department is lacking in your life. Just as a business can go bankrupt if it runs out of money, so can you if you don’t have enough money to meet your expenses or don’t know how to control your spending.
You might be surprised that many businesses are usually in debt. However, this is good debt. They borrow money from the banks to finance their purchases with the intention of growing their sales and profits. However, they know how to control their cash flow (that is, money going in and out of the company). Borrowing money so that you can have your expensive toy is bad debt!
Like it or not, in the business of life, you need to take on the role as Chief Financial Officer or Finance Director too! Otherwise, you will squander all your money away and go into heavy debt.
“I have no luck in investing.”
If you feel investing has got to do with luck, it’s a danger sign that you need to beef up the financial department in life’s business. If you are financially savvy, you will have a proper plan and strategy in terms of how to grow your money. It has less to do with luck and more to do with the choice of investments and the financial decisions you make.
You will need to address this problem by either getting professional help or start working towards being financially literate.
Finance departments in most business area are very careful about how they manage the company’s financial resources and do not subject their funds to risky investments, let alone luck! You should do the same in your life too.
“I have no time to take a course or develop myself.”
You need to constantly develop yourself, yourself. What if human resource managers say to their employees that they are too busy to run training and skills development programmes for their staff? It is their job to get this done, no matter how busy they are handling personnel related matters.
Similarly, the HR department in your life should also make time for self-improvement and developmental activities. You cannot afford to stagnate in your area of expertise as skills and expertise can also get obsolete through time. Your competitors are upgrading themselves and so you must keep up!
“I fail when it comes to relationships.”
If you are going to succeed in life, your personal life should also be in order. Your failure indicates a problem in your HR department. Problems with your personal relationships or worse, a divorce, can financially ruin you and distract you from your career goals.
Your personal welfare is important. A stable HR department in you means that you have close relationships with your friends and loved ones so that you have the necessary support and motivation to succeed. You can also count on their support to tackle the ups and downs in life as well as deal with the constant changes that will destabilize you.
“I am terrible at IT.”
If you are computer illiterate and do not browse the Internet, sad to say, you are one of the rare few in today’s connected world. Even retired people have become net-savvy.
The new generation of youths out there will not likely have this problem. However, if you think that knowing how to use key productivity applications such as Word, PowerPoint, and Excel are enough, you are mistaken. Many youths have gone beyond this and started leveraging applications such as FaceBook, MySpace, LinkedIn, Twitter, Wikipedia, etc. Your competitors are gaining an edge over you especially in the area of social networking, meeting new friends and potential business contacts.Gone are the days where the IT department is expected just to support users and basic applications. The same applies to the business of life.
“I don't do Internet Banking or Online Shopping, it's Unsafe.”
You are far behind if you don’t do Internet banking or online shopping. Saying it is unsafe is just another excuse. You are depriving yourself of increased productivity and convenience. It also suggests that you probably don’t know how to Google properly, have not bought a book from Amazon, or traded at eBay. Or how about Social Networking?
At a time where users are demanding more from their IT department, your life’s own IT department needs to step up or you will lose a competitive edge.
Get Your Life's Business Back on Track
In the business world, if one or more of the key departments of a company start to fail, it is an impending sign of trouble ahead. The same logic applies to you...in your business of life.
By recognising which business departments you are weak in and making positive changes in them, you are taking one big step in making your business of life successful!
- A. “I am not good at selling or marketing.”
- B. “I am terrible in communications.”
- C. “I am in constant debt.”
- D. “I have no luck in investing.”
- E. “I have no time to take a course or develop myself.”
- F. “I fail when it comes to personal relationships.”
- G. “I am terrible at IT.”
- H. “I don’t do Internet banking or online shopping, it’s unsafe.”
In the daily business of life, you probably often hear such remarks in your conversations. How many of these statements are applicable to you? Now look at points A to H above, tick the ones that you can identify with.
The truth is that these statements indicate which department in the business of life you are weak in. Your life can be analyzed using business metaphors and concepts.
Take a look at the table below:
(each remark corresponds to a business department)
• A-B: Sales & Marketing Department (How you sell and market yourself)
• C-D: Finance Department (How you manage your personal finances)
• E-F: Human Resource Department (How you manage your own growth, health, relationships and welfare)
• G-H: IT Department (How you use technology)
Let's look at these remarks in a little more detail...
“I am no good in selling or marketing.”
If you often make this remark, this is an indication that in the business of life, your Sales & Marketing department is not doing its job. If you are not selling your abilities, then you will not be noticed at all, no matter how good you are in your work. Realize that every day, you are selling something, whether it is convincing your project management team of the viability of your recommendation, selling to your clients and customers, or even doing a presentation. You need to have a sales target with goals that you can work towards. In addition, if you do not address the needs and objectives of your boss – which is what marketing is all about – you are unlikely to make an impact in your organization, depriving you of your long awaited promotion. You should be selling him ideas and showing your value instead of doing tasks that are unimportant and irrelevant.
“I am terrible at communications.”
Communication is important in business as it is in everyday life. Your inability to communicate hinders your ability to do your job effectively and might slow down your career progression. It can be as simple as being able to present to a group of people.
Public relations, a key function in every business, is about building a good relationship with the press so that what is written is positive and this creates a positive perception of the company. In the same way, if you ignore the PR for your own business of life and neglect this department in you, you cannot shape your boss’ or management’s opinion in your favour. And you will not be able to build goodwill for yourself. PR in the business of life could mean a simple gesture of paying a compliment to your boss or colleagues (when it is due), doing more than what your job requires you to do, or even being a trusted advisor in your area of expertise.
“I am in constant debt.”
There are two kinds of debt – good and bad debt. Good debt refers to loans borrowed against assets (which can grow) that you acquire while bad debt refers to credit card debts and money you have borrowed to buy things for leisure or pleasure. When you incur lots of bad debt, there’s cause to be concerned. You would have a serious financial problem and it indicates that this department is lacking in your life. Just as a business can go bankrupt if it runs out of money, so can you if you don’t have enough money to meet your expenses or don’t know how to control your spending.
You might be surprised that many businesses are usually in debt. However, this is good debt. They borrow money from the banks to finance their purchases with the intention of growing their sales and profits. However, they know how to control their cash flow (that is, money going in and out of the company). Borrowing money so that you can have your expensive toy is bad debt!
Like it or not, in the business of life, you need to take on the role as Chief Financial Officer or Finance Director too! Otherwise, you will squander all your money away and go into heavy debt.
“I have no luck in investing.”
If you feel investing has got to do with luck, it’s a danger sign that you need to beef up the financial department in life’s business. If you are financially savvy, you will have a proper plan and strategy in terms of how to grow your money. It has less to do with luck and more to do with the choice of investments and the financial decisions you make.
You will need to address this problem by either getting professional help or start working towards being financially literate.
Finance departments in most business area are very careful about how they manage the company’s financial resources and do not subject their funds to risky investments, let alone luck! You should do the same in your life too.
“I have no time to take a course or develop myself.”
You need to constantly develop yourself, yourself. What if human resource managers say to their employees that they are too busy to run training and skills development programmes for their staff? It is their job to get this done, no matter how busy they are handling personnel related matters.
Similarly, the HR department in your life should also make time for self-improvement and developmental activities. You cannot afford to stagnate in your area of expertise as skills and expertise can also get obsolete through time. Your competitors are upgrading themselves and so you must keep up!
“I fail when it comes to relationships.”
If you are going to succeed in life, your personal life should also be in order. Your failure indicates a problem in your HR department. Problems with your personal relationships or worse, a divorce, can financially ruin you and distract you from your career goals.
Your personal welfare is important. A stable HR department in you means that you have close relationships with your friends and loved ones so that you have the necessary support and motivation to succeed. You can also count on their support to tackle the ups and downs in life as well as deal with the constant changes that will destabilize you.
“I am terrible at IT.”
If you are computer illiterate and do not browse the Internet, sad to say, you are one of the rare few in today’s connected world. Even retired people have become net-savvy.
The new generation of youths out there will not likely have this problem. However, if you think that knowing how to use key productivity applications such as Word, PowerPoint, and Excel are enough, you are mistaken. Many youths have gone beyond this and started leveraging applications such as FaceBook, MySpace, LinkedIn, Twitter, Wikipedia, etc. Your competitors are gaining an edge over you especially in the area of social networking, meeting new friends and potential business contacts.Gone are the days where the IT department is expected just to support users and basic applications. The same applies to the business of life.
“I don't do Internet Banking or Online Shopping, it's Unsafe.”
You are far behind if you don’t do Internet banking or online shopping. Saying it is unsafe is just another excuse. You are depriving yourself of increased productivity and convenience. It also suggests that you probably don’t know how to Google properly, have not bought a book from Amazon, or traded at eBay. Or how about Social Networking?
At a time where users are demanding more from their IT department, your life’s own IT department needs to step up or you will lose a competitive edge.
Get Your Life's Business Back on Track
In the business world, if one or more of the key departments of a company start to fail, it is an impending sign of trouble ahead. The same logic applies to you...in your business of life.
By recognising which business departments you are weak in and making positive changes in them, you are taking one big step in making your business of life successful!
Tuesday, January 4, 2011
Why is the Business of Life Approach Important?
I have been reading self-improvement books since I started serving my national service in the Singapore army. My friends used to make fun of me saying I was insecure. They, of course, preferred to drink and party. The truth was that I was searching for a success formula in life. I also had many weaknesses that I wanted to address.
After reading more than a hundred self-improvement books, I have yet to find a holistic approach to achieving success in life. This is why I researched into creating the Business of Life model - where it is about you running your life like a business with profit motive in mind. You also operate your life like a business entity with its own key departments and business functions to ensure smooth operations and growth.
Many books define success as getting rich. But keeping it is another issue which is often not discussed as part of the success equation. To achieve massive wealth, best-selling authors recommend that you start your own company, invest in real estate or in the stock market. Let's take a look at each of these ideas from the Business of Life perspective.
To Be Rich, You Need to Start Your Own Business
While I agree that running your own business is definitely one path to becoming a millionaire, the reality is that many of us are employees and will not dare to start a company. Even if we do consider venturing into a new business, we are often discouraged by dismal statistics of the high rate of businesses which fail within the first three years.
The Business of Life Approach
You must first run your life like a business before you are ready to run a real business. The Business of Life approach I am advocating teaches you how to do this where you need to ensure that the key departments in our life - Leadership, Sales/Marketing, Finance, HR, IT have to be in order. The lack of strong organisational hierachy and business foundation are the reasons why many ventures fail.
Property Investment Makes You Rich
How about investing in real estate? We often hear or read about many cases of people who struck gold buying property. With capital appreciation, it is definitely a viable option to wealth creation as buying a property means getting into good debt - the ultimate form of leverage, but it's a long-term commitment and your money gets tied up. Yet we also hear of people who over-commited and find themselves in financial ruin when the market collapses.
The Business of Life Approach
People who get burned when the economy goes into tail-spin are likely those who are not financially saavy or who lack good understanding of personal finance. The Business Life approach is about running your life like a business and ensuring that your finance department does its job. It will not necessarily guarantee the prevention of financial disasters but it can mitigate the negative effects of any economic turmoil. There are no shortcuts, you need to think like a financial manager or at least have basic financial skills whether you like it or not!
You can Makes Lots of Money Investing in the Stock Market
Agreed. In good times, many people can make a pile of money, so much so that some of them become complacent, over-confident and greedy. When the market unexpectedly turns on them, they get caught with their pants down and panic by selling their stocks or making hasty decisions, resulting in huge losses in their investment portfolio.
The Business of Life Approach
To have a better chance of success here in the business of your life, the CEO within you must be a strong leader with clear goals and realistics targets. Business leaders do not make subjective or emotional decisions. In addition, the finance department within you should do its job and ensure that you invest in equities that have strong fundamental with realistic returns versus chasing stocks based on tips or market rumours.
Now let's assume we get rich through one or all of the above methods...
What happens if your health fails or if you cheat on your wife. Perhaps, you do something silly or unethical, then what?
Right, your success falls apart no matter how rich or successful you might be.
Why the Business of Life Approach is so Powerful
By borrowing business concepts and metaphors, and them applying them to our daily lives (down to even modelling how a successful business is run), it provides all of us with a simple business model which most of us will already have been exposed to in our working life.
5 Key Areas
With the above areas as examples, the Business of Life approach can be used:
After reading more than a hundred self-improvement books, I have yet to find a holistic approach to achieving success in life. This is why I researched into creating the Business of Life model - where it is about you running your life like a business with profit motive in mind. You also operate your life like a business entity with its own key departments and business functions to ensure smooth operations and growth.
Many books define success as getting rich. But keeping it is another issue which is often not discussed as part of the success equation. To achieve massive wealth, best-selling authors recommend that you start your own company, invest in real estate or in the stock market. Let's take a look at each of these ideas from the Business of Life perspective.
To Be Rich, You Need to Start Your Own Business
While I agree that running your own business is definitely one path to becoming a millionaire, the reality is that many of us are employees and will not dare to start a company. Even if we do consider venturing into a new business, we are often discouraged by dismal statistics of the high rate of businesses which fail within the first three years.
The Business of Life Approach
You must first run your life like a business before you are ready to run a real business. The Business of Life approach I am advocating teaches you how to do this where you need to ensure that the key departments in our life - Leadership, Sales/Marketing, Finance, HR, IT have to be in order. The lack of strong organisational hierachy and business foundation are the reasons why many ventures fail.
Property Investment Makes You Rich
How about investing in real estate? We often hear or read about many cases of people who struck gold buying property. With capital appreciation, it is definitely a viable option to wealth creation as buying a property means getting into good debt - the ultimate form of leverage, but it's a long-term commitment and your money gets tied up. Yet we also hear of people who over-commited and find themselves in financial ruin when the market collapses.
The Business of Life Approach
People who get burned when the economy goes into tail-spin are likely those who are not financially saavy or who lack good understanding of personal finance. The Business Life approach is about running your life like a business and ensuring that your finance department does its job. It will not necessarily guarantee the prevention of financial disasters but it can mitigate the negative effects of any economic turmoil. There are no shortcuts, you need to think like a financial manager or at least have basic financial skills whether you like it or not!
You can Makes Lots of Money Investing in the Stock Market
Agreed. In good times, many people can make a pile of money, so much so that some of them become complacent, over-confident and greedy. When the market unexpectedly turns on them, they get caught with their pants down and panic by selling their stocks or making hasty decisions, resulting in huge losses in their investment portfolio.
The Business of Life Approach
To have a better chance of success here in the business of your life, the CEO within you must be a strong leader with clear goals and realistics targets. Business leaders do not make subjective or emotional decisions. In addition, the finance department within you should do its job and ensure that you invest in equities that have strong fundamental with realistic returns versus chasing stocks based on tips or market rumours.
Now let's assume we get rich through one or all of the above methods...
What happens if your health fails or if you cheat on your wife. Perhaps, you do something silly or unethical, then what?
Right, your success falls apart no matter how rich or successful you might be.
Why the Business of Life Approach is so Powerful
By borrowing business concepts and metaphors, and them applying them to our daily lives (down to even modelling how a successful business is run), it provides all of us with a simple business model which most of us will already have been exposed to in our working life.
5 Key Areas
- CEO - Self leadership
- Sales/Marketing Department- how you market and sell yourself
- Finance Department - how you manage your finances
- HR Department - how you manage your own welfare (including your health and family), personal growth and resources available to you
- IT Department - how you use innovation and technology
With the above areas as examples, the Business of Life approach can be used:
- To provide a clear roadmap to success
- As a model to explain why people succeed or fail in life
- To assess which areas (or departments) that one is weak in and therefore seek improvement
- To inspire us to learn from business lessons and resources to make as much money as we can
- To share business success secrets that you can apply to your own life
- To make the point that educational qualification and professional experience alone are not enough for you to achieve financial abundance or independence
Monday, January 3, 2011
The Reasons Why a Business Fails are Similar to Why We Fail in Life
Do you know that the reasons why a business fail are also applicable to why a person can fail in life? The answer lies in the Business of Life - how you can run your life like a business.
Why Businesses Fail
Here are four main reasons why businesses generally fail:
General Business Reasons
There are many reasons why companies fail. Among the top reasons is the lack of a well-developed business plan. This includes inadequate or insufficient planning even before starting it.
Failure also occurs when the entrepreneur is overly optimistic about achievable sales and underestimates what needs to be done to sustain the business or reach the desired goal. In fact, miscalculated growth strategies often account for such failures. Then there’s consistent poor service that turns customers off.
To aggravate matters, many small businesses do not recognize or even ignore their shortcomings. Because of their lack of relevant skill sets, they do not address these problems or seek help from others. They see consultants or professional help as a waste of money. To aggravate matters, management could be in a constant state of denial, which happens to be one of the top reasons why businesses fail.
Lessons to be Learnt
• Do you have a business plan (career plan) or do you leave it to fate?
• Are you too overconfident about your abilities and have unrealistic expectations?
• Do you over-promise and under-deliver?
• Do you provide poor service (poor quality, missed deadlines, broken promises, etc) to your stakeholders and have turned them off?
• Are you aware of your short-comings and weaknesses?
• Do you have the right skills and knowledge to do the job?
• Do you blame others for your failure and are reluctant to learn from more qualified or experienced people?
Financial Factors
Financial reasons are the next factor contributing to business failure. Poor cash flow management skills or poor understanding of cash flow can cause the company to fall apart. Cash flow is simply defined as a measure of a company’s financial health where it involves the movement of money into and out of the business.
Many small businesses make losses because their operating costs are too high, relative to their sales revenues. While it might take two or more years for the company to breakeven, many entrepreneurs are unable to sustain their operations.
While investing in office premises, machinery, and other business related items are necessary during the initial start-up period, a number of businesses underestimate the cost of doing business. They make the mistake of making extravagant investments or purchases without adequately considering the return on their investment. They might overlook other business expenses and hidden costs and fail to budget for them.
Their failure to manage their cash flow and high business costs, combined with lower sales than expected amplifies their financial woes and before long, they run out of money.
Financial matters also haunt start-ups that experience early success. They too can fall victim to over-expansion. Yes, growing too fast can also lead to undesired outcomes as the company over-commits resources it cannot afford to. In anticipation that sales can be sustained or even grow, the company takes on further debt by borrowing from banks to finance their expansion, such as setting up more retails stores, stocking up inventories, aggressive advertising, etc.
Finally, businesses encounter bad times when they make the mistake of not pricing their products properly. This happens when they fail to include all necessary items when setting prices, or that they underestimate the impact of competitive pricing. Thus, the wrong pricing strategy takes its toll on the company’s bottom-line, in spite of the fact that the product might be of superior quality.
Lessons to be Learnt
• Do you know how to manage money and your own cash flow?
• Is your operating cost too high (your personal expenditure) relative to your revenue (your income)?
• Are you expanding your business too quickly by over-committing your financial resources (i.e a new car or house when you are doing well in your career) and have taken on too much debt?
• Have your priced your products and services correctly (meaning that you are not under-paid based on your qualifications and skills)?
Human Resource Related
Besides general and financial related factors that contribute to a business downfall, human-resource related reasons can also be one of the causes for failure.
Studies indicate that businesses could fail because of management’s inability to delegate properly. They choose to micro-manage work given to others or over delegating but abdicate important management responsibilities. As a result, employees’ morale is affected while the company loses its sense of direction, focus and mission.
Besides failure on the part of the management, hiring the wrong employees is also one reason why businesses stumble. Often, bosses will hire mere clones of themselves and not people with complementary skills. Or they could hire friends and relatives, prompting favouritism and discrimination in the office place.
Lessons to be Learnt
• Do you “micromanage” by wasting a lot of time on unproductive matters or minute details?
• Are you afraid to make decisions and prefer to let others make decisions on your behalf?
• Do you mix around with the wrong kinds of people which limits your growth (e.g people who criticize, discourage you or give you flawed advice)?
Marketing Factors
The final factor causing businesses to close is related to marketing. Businesses often minimize the importance of promoting the business properly. In fact, many of them don’t even focus on promoting their products and services at all. Then there are businesses that do not make use of the full-spectrum of marketing activities. For example, they choose only to advertise but ignore publicity-related activities such as product launches or issuing press releases.
For those who do embark on marketing initiatives, they promote their products and services too aggressively that they end up generating ill-will among their prospective customers. The same negative image is generated towards businesses which make false promises or claims to their prospective buyers in order to make a sale.
Besides promotional activities, competition is another area which businesses overlook in terms of impact and which have severe consequences on the mid to long-term future prospects. Entrepreneurs often do not understand who their competition is or, in many cases, ignore competitive movements or initiatives. For example, when asked how their offerings are different from their competition, they are unable to articulate a competitive advantage. Then there are those who are slow to react to pricing pressures or to new competing products with superior price-performance benefits. Sometimes, a business could be doing so well that over-confidence sets in with the management. They pooh-pooh any major competitive products or services but only to find later, that their own business is affected as sales take a nosedive.
Businesses also fail because of too much focus and reliance on a single product, a fixed set of customers or clients. This scenario happens when a business closes deals with a few major customers and becomes complacent. Relationships with these customers start to deteriorate as the business either does not maintain its service quality or fails to offer preferential treatment. The problem here is that companies forget about the importance of customer-relationship management in ensuring long-term sustainable sales. They hence find themselves stranded with a huge revenue hole when key customers abandon them.
Lessons to be Learnt
• Do you promote yourself and your capabilities in your resume or in your current job (or do you keep a low profile)?
• Do you have good branding where your reputation precedes you (i.e you are known to be good in something)? Or do you have a bad reputation instead?
• Do you over-promote yourself by taking credit for what you didn’t do in the work place? Or do you over-estimate what you are capable of delivering?
• Are you aware of who is the competition (those competing for management attention and recognition or those who enjoy a closer relationship to your bosses) in your work place? What do you do better than the competition?
• Are you over-reliant on just one customer (i.e your boss)? Do you also cultivate good relationships with your peers, managers and stakeholders from other departments just in case your boss moves on?
The above are just some of the reasons why business fail - and applying them to your own life can help you to avoid failure. Actually, failure can stem from one or more of the key departments within your life's business.
Now that you have seen the same factors that contribute to business failure can be applicable to our own lives, can you think of other reasons why businesses fail - and how we can learn from these mistake in our own life's business? Please contribute.
Why Businesses Fail
Here are four main reasons why businesses generally fail:
- General Business Reasons
- Financial Factors
- Human Resource-related
- Marketing Factors
General Business Reasons
There are many reasons why companies fail. Among the top reasons is the lack of a well-developed business plan. This includes inadequate or insufficient planning even before starting it.
Failure also occurs when the entrepreneur is overly optimistic about achievable sales and underestimates what needs to be done to sustain the business or reach the desired goal. In fact, miscalculated growth strategies often account for such failures. Then there’s consistent poor service that turns customers off.
To aggravate matters, many small businesses do not recognize or even ignore their shortcomings. Because of their lack of relevant skill sets, they do not address these problems or seek help from others. They see consultants or professional help as a waste of money. To aggravate matters, management could be in a constant state of denial, which happens to be one of the top reasons why businesses fail.
Lessons to be Learnt
• Do you have a business plan (career plan) or do you leave it to fate?
• Are you too overconfident about your abilities and have unrealistic expectations?
• Do you over-promise and under-deliver?
• Do you provide poor service (poor quality, missed deadlines, broken promises, etc) to your stakeholders and have turned them off?
• Are you aware of your short-comings and weaknesses?
• Do you have the right skills and knowledge to do the job?
• Do you blame others for your failure and are reluctant to learn from more qualified or experienced people?
Financial Factors
Financial reasons are the next factor contributing to business failure. Poor cash flow management skills or poor understanding of cash flow can cause the company to fall apart. Cash flow is simply defined as a measure of a company’s financial health where it involves the movement of money into and out of the business.
Many small businesses make losses because their operating costs are too high, relative to their sales revenues. While it might take two or more years for the company to breakeven, many entrepreneurs are unable to sustain their operations.
While investing in office premises, machinery, and other business related items are necessary during the initial start-up period, a number of businesses underestimate the cost of doing business. They make the mistake of making extravagant investments or purchases without adequately considering the return on their investment. They might overlook other business expenses and hidden costs and fail to budget for them.
Their failure to manage their cash flow and high business costs, combined with lower sales than expected amplifies their financial woes and before long, they run out of money.
Financial matters also haunt start-ups that experience early success. They too can fall victim to over-expansion. Yes, growing too fast can also lead to undesired outcomes as the company over-commits resources it cannot afford to. In anticipation that sales can be sustained or even grow, the company takes on further debt by borrowing from banks to finance their expansion, such as setting up more retails stores, stocking up inventories, aggressive advertising, etc.
Finally, businesses encounter bad times when they make the mistake of not pricing their products properly. This happens when they fail to include all necessary items when setting prices, or that they underestimate the impact of competitive pricing. Thus, the wrong pricing strategy takes its toll on the company’s bottom-line, in spite of the fact that the product might be of superior quality.
Lessons to be Learnt
• Do you know how to manage money and your own cash flow?
• Is your operating cost too high (your personal expenditure) relative to your revenue (your income)?
• Are you expanding your business too quickly by over-committing your financial resources (i.e a new car or house when you are doing well in your career) and have taken on too much debt?
• Have your priced your products and services correctly (meaning that you are not under-paid based on your qualifications and skills)?
Human Resource Related
Besides general and financial related factors that contribute to a business downfall, human-resource related reasons can also be one of the causes for failure.
Studies indicate that businesses could fail because of management’s inability to delegate properly. They choose to micro-manage work given to others or over delegating but abdicate important management responsibilities. As a result, employees’ morale is affected while the company loses its sense of direction, focus and mission.
Besides failure on the part of the management, hiring the wrong employees is also one reason why businesses stumble. Often, bosses will hire mere clones of themselves and not people with complementary skills. Or they could hire friends and relatives, prompting favouritism and discrimination in the office place.
Lessons to be Learnt
• Do you “micromanage” by wasting a lot of time on unproductive matters or minute details?
• Are you afraid to make decisions and prefer to let others make decisions on your behalf?
• Do you mix around with the wrong kinds of people which limits your growth (e.g people who criticize, discourage you or give you flawed advice)?
Marketing Factors
The final factor causing businesses to close is related to marketing. Businesses often minimize the importance of promoting the business properly. In fact, many of them don’t even focus on promoting their products and services at all. Then there are businesses that do not make use of the full-spectrum of marketing activities. For example, they choose only to advertise but ignore publicity-related activities such as product launches or issuing press releases.
For those who do embark on marketing initiatives, they promote their products and services too aggressively that they end up generating ill-will among their prospective customers. The same negative image is generated towards businesses which make false promises or claims to their prospective buyers in order to make a sale.
Besides promotional activities, competition is another area which businesses overlook in terms of impact and which have severe consequences on the mid to long-term future prospects. Entrepreneurs often do not understand who their competition is or, in many cases, ignore competitive movements or initiatives. For example, when asked how their offerings are different from their competition, they are unable to articulate a competitive advantage. Then there are those who are slow to react to pricing pressures or to new competing products with superior price-performance benefits. Sometimes, a business could be doing so well that over-confidence sets in with the management. They pooh-pooh any major competitive products or services but only to find later, that their own business is affected as sales take a nosedive.
Businesses also fail because of too much focus and reliance on a single product, a fixed set of customers or clients. This scenario happens when a business closes deals with a few major customers and becomes complacent. Relationships with these customers start to deteriorate as the business either does not maintain its service quality or fails to offer preferential treatment. The problem here is that companies forget about the importance of customer-relationship management in ensuring long-term sustainable sales. They hence find themselves stranded with a huge revenue hole when key customers abandon them.
Lessons to be Learnt
• Do you promote yourself and your capabilities in your resume or in your current job (or do you keep a low profile)?
• Do you have good branding where your reputation precedes you (i.e you are known to be good in something)? Or do you have a bad reputation instead?
• Do you over-promote yourself by taking credit for what you didn’t do in the work place? Or do you over-estimate what you are capable of delivering?
• Are you aware of who is the competition (those competing for management attention and recognition or those who enjoy a closer relationship to your bosses) in your work place? What do you do better than the competition?
• Are you over-reliant on just one customer (i.e your boss)? Do you also cultivate good relationships with your peers, managers and stakeholders from other departments just in case your boss moves on?
The above are just some of the reasons why business fail - and applying them to your own life can help you to avoid failure. Actually, failure can stem from one or more of the key departments within your life's business.
Now that you have seen the same factors that contribute to business failure can be applicable to our own lives, can you think of other reasons why businesses fail - and how we can learn from these mistake in our own life's business? Please contribute.
Sunday, January 2, 2011
Business of Life & Your Life's Organisation Chart
Today, I want to show you specifically how you can run your life like a real business by organising your life into key business functions. After analyzing several organisation charts, I have identified 5 key roles and departments in order to grow and make any generic business successful. These can be applied into your own life where you can focus on them and create your very own life's organisation chart (I will explain more later).
In any company or business venture, the CEO or managing director provides the leadership and direction for the business. He or she plans, owns and executes the business plan.The Sales and Marketing Department focuses on marketing and selling the company's products and services. Another key department is the Finance Department which handles and manages all financial matters such as the company's financial resources to support the business objectives as well as the accounting functions. The other two departments - HR and IT also play very important supporting roles.
The human resource department controls all of the functions of the hiring, firing, benefits administration and welfare of the company. On the other hand, the role of the IT or MIS (Management Information Systems) department is to meet and support the information and technological needs of the business and its business goals.
If any of the above departments are deficient in any way, it would impact the company's operations and have huge negative implications on its future.
Creating your Life's Organisation Chart
How on earth do I apply the above to my own life, you might ask. Simple, we will borrow business metaphors and apply them to you.
Let’s get started… I want you to restructure your life’s operations into several parts and imagine that you are the business. There’s you, the CEO, who decides your life’s directions and makes all the final decisions. Then there’s you - the sales and marketing director who is responsible for generating income, you – the HR director, you – the Finance director and finally, you – the IT director.
In the business of life, you will need to put yourselves into the shoes of these personas and play out their roles to reach your full potential. All of these inner you's must work in harmony with each other towards a common purpose. And you will need two key plans – a Personal Business Plan (PBP) and a Personal Marketing Plan (PMP).
Let’s go back and review all the business roles we have discussed, this time from the perspective of your life.
First, the role of CEO in your life is rather straightforward. You run your life’s business the way a CEO would. The four key departments in a business organization relate to the four key skills that you must develop in the Business of Life. Let me first give you a very quick introduction.
Sales & Marketing
This department is key to your life. It generates your income and helps pay the bills. You need to market yourself, sell your talents and what you offer over other alternatives. It is about catering to the needs of your employer by delivering what they want, delivering lots of value and going the extra mile.
Many concepts in sales and marketing are applicable to your life. Your “PR” (public relations) with others – getting along well with others – is key. You also need to realize the importance of creating a positive personal brand that will differentiate you from the competition.
Many people say they can’t sell or they don’t care about marketing. This kind of mentality is a huge disadvantage. Here’s the cruel reality: No matter how good you are, if others don’t know about your abilities or achievements, you will be overlooked in a promotion. If you don’t know how to communicate effectively, build relationships with others and sell yourself, you are severely handicapped!
Finance
You probably have read about the importance of personal finance. It is not how much you earn that makes you rich, it’s how much you save. In this department of your life, the ability to manage your finances and cash flow are crucial to personal success.
Sadly, many promising high-flyers don’t know how to manage their money. As soon as they get a windfall, they spend it all. For those doing well, they show off their wealth by buying luxury goods like expensive cars and jewellery, all of which do not contribute to their growth but put them in further debt.
So it is about investing for future growth rather then celebrating your past success! In a real business, it is the finance department that pulls the brakes on over-spending and ensures productive use of its financial resources. You should do the same in the business of life!
Human Resource
You need to ensure the human resource department in your own life still functions well and supports your life’s goals. No matter how good you think you are, you need to develop your skills and undergo continuous learning. So few people think about constantly upgrading themselves. Nor do they proactively gear themselves up for change.
You also need to take good care of yourself when it comes to your family, health and relationships with your relatives and close friends. Any setback here can ruin you or cause huge distractions that will stunt your future growth potential.
How you tap on internal and external resources can only bring out the best of your abilities. You need to recognise your strengths and weaknesses. Not doing anything at all stagnates your growth especially when you are contented with doing the same things every day. Conversely, underestimating your abilities, not asking for help, or punishing yourself because of a setback will leave you disillusioned and erode your self-confidence.
Information Technology
If you are not Internet savvy or worse, you are computer illiterate, you have a major problem in the business of life, especially in today’s knowledge economy and connected world.
Imagine the impact to a business if it had no Internet access, doesn’t communicate via email or does not use IT at all in its business operations. Ignore this department in your life at your own peril. The fact is you need to use technology to increase productivity, achieve competency and ensure competitiveness.
To succeed in the business of life, you need to ensure that all the personal business functions are in place and working in harmony with each other - under the leadership of You, the CEO. Only you can manage the multiple roles and departments within your life. In many cases, these departments might be non-existent and you wonder why your life's business is not doing well. Remember, just relying on career competency which I define as your education qualifications, your technical or professional skills, your talents and work experience is not going to be enough to thrive in the Business of Life.
The five key roles and departments are :
- CEO / Managing Director
- Sales and Marketing
- Finance
- Human Resource
- Information Technology/MIS
In any company or business venture, the CEO or managing director provides the leadership and direction for the business. He or she plans, owns and executes the business plan.The Sales and Marketing Department focuses on marketing and selling the company's products and services. Another key department is the Finance Department which handles and manages all financial matters such as the company's financial resources to support the business objectives as well as the accounting functions. The other two departments - HR and IT also play very important supporting roles.
The human resource department controls all of the functions of the hiring, firing, benefits administration and welfare of the company. On the other hand, the role of the IT or MIS (Management Information Systems) department is to meet and support the information and technological needs of the business and its business goals.
If any of the above departments are deficient in any way, it would impact the company's operations and have huge negative implications on its future.
Creating your Life's Organisation Chart
How on earth do I apply the above to my own life, you might ask. Simple, we will borrow business metaphors and apply them to you.
Let’s get started… I want you to restructure your life’s operations into several parts and imagine that you are the business. There’s you, the CEO, who decides your life’s directions and makes all the final decisions. Then there’s you - the sales and marketing director who is responsible for generating income, you – the HR director, you – the Finance director and finally, you – the IT director.
In the business of life, you will need to put yourselves into the shoes of these personas and play out their roles to reach your full potential. All of these inner you's must work in harmony with each other towards a common purpose. And you will need two key plans – a Personal Business Plan (PBP) and a Personal Marketing Plan (PMP).
Let’s go back and review all the business roles we have discussed, this time from the perspective of your life.
First, the role of CEO in your life is rather straightforward. You run your life’s business the way a CEO would. The four key departments in a business organization relate to the four key skills that you must develop in the Business of Life. Let me first give you a very quick introduction.
Sales & Marketing
This department is key to your life. It generates your income and helps pay the bills. You need to market yourself, sell your talents and what you offer over other alternatives. It is about catering to the needs of your employer by delivering what they want, delivering lots of value and going the extra mile.
Many concepts in sales and marketing are applicable to your life. Your “PR” (public relations) with others – getting along well with others – is key. You also need to realize the importance of creating a positive personal brand that will differentiate you from the competition.
Many people say they can’t sell or they don’t care about marketing. This kind of mentality is a huge disadvantage. Here’s the cruel reality: No matter how good you are, if others don’t know about your abilities or achievements, you will be overlooked in a promotion. If you don’t know how to communicate effectively, build relationships with others and sell yourself, you are severely handicapped!
Finance
You probably have read about the importance of personal finance. It is not how much you earn that makes you rich, it’s how much you save. In this department of your life, the ability to manage your finances and cash flow are crucial to personal success.
Sadly, many promising high-flyers don’t know how to manage their money. As soon as they get a windfall, they spend it all. For those doing well, they show off their wealth by buying luxury goods like expensive cars and jewellery, all of which do not contribute to their growth but put them in further debt.
So it is about investing for future growth rather then celebrating your past success! In a real business, it is the finance department that pulls the brakes on over-spending and ensures productive use of its financial resources. You should do the same in the business of life!
Human Resource
You need to ensure the human resource department in your own life still functions well and supports your life’s goals. No matter how good you think you are, you need to develop your skills and undergo continuous learning. So few people think about constantly upgrading themselves. Nor do they proactively gear themselves up for change.
You also need to take good care of yourself when it comes to your family, health and relationships with your relatives and close friends. Any setback here can ruin you or cause huge distractions that will stunt your future growth potential.
How you tap on internal and external resources can only bring out the best of your abilities. You need to recognise your strengths and weaknesses. Not doing anything at all stagnates your growth especially when you are contented with doing the same things every day. Conversely, underestimating your abilities, not asking for help, or punishing yourself because of a setback will leave you disillusioned and erode your self-confidence.
Information Technology
If you are not Internet savvy or worse, you are computer illiterate, you have a major problem in the business of life, especially in today’s knowledge economy and connected world.
Imagine the impact to a business if it had no Internet access, doesn’t communicate via email or does not use IT at all in its business operations. Ignore this department in your life at your own peril. The fact is you need to use technology to increase productivity, achieve competency and ensure competitiveness.
To succeed in the business of life, you need to ensure that all the personal business functions are in place and working in harmony with each other - under the leadership of You, the CEO. Only you can manage the multiple roles and departments within your life. In many cases, these departments might be non-existent and you wonder why your life's business is not doing well. Remember, just relying on career competency which I define as your education qualifications, your technical or professional skills, your talents and work experience is not going to be enough to thrive in the Business of Life.
Saturday, January 1, 2011
Setting Up Your Business of Life
What does it take to set up a business? You might know of someone who has set up his or her own business. Or you might even have set up your very own venture.
Let me blog about this and show you that by planning our careers from our school days, we are already unconsciously or sub-consciously setting up our very own business of life.
What Happens in a Typical Start-up?
I did a quick chart below to show a basic framework of setting up a business. In simple terms, the founder of the business goes into a venture with a business idea, bringing his expertise and experience. In putting together his business plan, he has to decide what products and services his business wants to offer and to which target market or industry. He also has to decide what his core competencies and strengths are, relative to his competitors and what benefits he brings to his prospective customers.
Besides the sales and marketing aspect, he has to decide how to fund his business - whether it is through getting investors or borrowing money. From a financial perspective, he has to decide what business assets to acquire in order to generate sales for his venture, how to price his product or service, and how much profit margin to make from his product or service.
Starting up Life's Business
Let's draw a parallel of the above against our own lives - looking at it from a "business" perspective. Now imagine stepping into the working world of business. Just as you have to decide what products and services you want to offer the market in a typical business venture, you too need to decide what you want to offer to your "customer" - in this case, it is your employer who is your customer.
Your business plan is actually your career plan (that is, if you do have one). Like a business, you will have to decide which target market you want to go after by choosing the industry that you want to work in that you can be successful. You being highly successful or rich is dependent on what "business" you want to get into. If you have ambitions on being a doctor or a private banker, that would have significant implications on your "business model". And don't forget that just like the real business world, there are going to be lots of competitors all offering similar products and services. So you need to be different. Here's where personal branding comes in!
Can you see how applying business metaphors to your life can be useful?
Now don't forget that just as investments are needed in any business, over the years you too have made an investment in yourself with the education and training courses you have attended in the business of life. The extent of how much you invest in yourself directly impacts your future success!
(or maybe you didn't bother to invest in yourself and flunked your examinations.)
That's the reason why a medical or law degree costs much more than a degree in teaching. The earning power of these occupations differ extensively. But take heart, as we have learnt in the business world, it is not just about how much money you make. It is about how much money you save. Or in business terms, it is about your profit margin (defined in accounting terms as the difference between the purchase price and the cost of bringing the product/service to market).
When I discovered how relevant business concepts are in setting up one's business of life and how we can effectively run it like a business, I was blown away. I decided to try it out - that was five years ago. Since then, I have increased my net worth by three-fold!
Let me blog about this and show you that by planning our careers from our school days, we are already unconsciously or sub-consciously setting up our very own business of life.
What Happens in a Typical Start-up?
I did a quick chart below to show a basic framework of setting up a business. In simple terms, the founder of the business goes into a venture with a business idea, bringing his expertise and experience. In putting together his business plan, he has to decide what products and services his business wants to offer and to which target market or industry. He also has to decide what his core competencies and strengths are, relative to his competitors and what benefits he brings to his prospective customers.
Besides the sales and marketing aspect, he has to decide how to fund his business - whether it is through getting investors or borrowing money. From a financial perspective, he has to decide what business assets to acquire in order to generate sales for his venture, how to price his product or service, and how much profit margin to make from his product or service.
Starting up Life's Business
Let's draw a parallel of the above against our own lives - looking at it from a "business" perspective. Now imagine stepping into the working world of business. Just as you have to decide what products and services you want to offer the market in a typical business venture, you too need to decide what you want to offer to your "customer" - in this case, it is your employer who is your customer.
Your business plan is actually your career plan (that is, if you do have one). Like a business, you will have to decide which target market you want to go after by choosing the industry that you want to work in that you can be successful. You being highly successful or rich is dependent on what "business" you want to get into. If you have ambitions on being a doctor or a private banker, that would have significant implications on your "business model". And don't forget that just like the real business world, there are going to be lots of competitors all offering similar products and services. So you need to be different. Here's where personal branding comes in!
Can you see how applying business metaphors to your life can be useful?
Now don't forget that just as investments are needed in any business, over the years you too have made an investment in yourself with the education and training courses you have attended in the business of life. The extent of how much you invest in yourself directly impacts your future success!
(or maybe you didn't bother to invest in yourself and flunked your examinations.)
That's the reason why a medical or law degree costs much more than a degree in teaching. The earning power of these occupations differ extensively. But take heart, as we have learnt in the business world, it is not just about how much money you make. It is about how much money you save. Or in business terms, it is about your profit margin (defined in accounting terms as the difference between the purchase price and the cost of bringing the product/service to market).
Introducing the Business of Life Concept for Success
Introducing the Business of Life
It's 1st Jan, 2011. I am writing this blog to share with everyone a concept that I have been researching for the last five years. It is called the Business Model of Life.
I firmly believe that if you want to be successful in life, you have to run your life like a business.
How often have you heard this statement: “It’s just business, nothing personal”. What if I told you that it IS personal as it concerns YOUR BUSINESS – because “Your life is your business”. Nobody else can run it except you!
Whether you are conscious of it or not, the life of each and every one of us revolves around some sort of business-related activity, and how you successfully conduct and handle these transactions will determine your own success. I call this the Business of Life.
The Cambridge dictionary defines a business as “the activity of buying and selling goods and services”. Even our everyday language is filled with business talk or metaphors. Examples are: “You should invest some time in …”, “What was your pitch to him?”, “Did he buy your reasoning?”, “try negotiating with him”, “Why didn’t you sell him your idea?”
The fact is that many tasks we perform in our lives are akin to business transactions - even outside our work place. We get paid in kind or cash in return for doing something or offering a service – whether we are at home or school.
At home, parents invest in the future of their children in the hope they can give them a better life. They hope to get rewarded with good returns when their children grow up and become successful, allowing them to retire comfortably.
At school, you earn good grades if you study hard. Getting poor results is the consequence of a poor performance in examinations - which simply means lack of preparation. You get what you deserve. The more time you invest in studying, the better the results.
Life Revolves Around Business Transactions
Yes, life revolves around business transactions such that to get something, we must give or offer something in the first place that is of value. Sometimes what we get does not meet our expectations and so, we get disgruntled or unhappy. Other times, we get more than what we bargained for.
This is even more evident in our working lives. At work, you get paid what you are worth. What you are worth is the result of your performance, academic and professional qualifications, experience and competency as well as your employer’s perception of your contribution and value.
In fact, you are getting paid for offering a service to your employer or customers whether you are a doctor, lawyer, engineer, businessman or teacher. That means that YOU are your own business. What you offer as a person and get paid for are the products and services that you own, and you alone will profit directly from it. You alone decide what this is and what value it can bring to your customers – in this case, it’s your employer.
There was even a newspaper report that suggests that one can put a business value on the household chores which housewives provide. According to a poll of 4,000 housewives, the average mum works for nearly nine hours a day every day. If she were to be employed doing these same household errands, the amount would be almost £30,000 a year when the average annual UK wage is £23,000.
The business of being you is not something people often think about. The conventional thinking is that a business refers to a formal business entity - sole proprietorship, private business or public-listed company.
YOU are the Business
But stop for a moment and reflect. You are currently an employee to the company you work for - big or small. Now what if tomorrow, you decide to start your own business and ask your same employer to hire your services, offering the same services you provided as an employee. This could happen if you are a consultant, an engineer, a lawyer, a PR specialist, or a teacher. It is still the same you, except you are not being paid as an employee any more. It is now your business entity that is transacting with the company you worked for. Nothing has changed except how the transaction is being recorded.
Get the idea? YOU are the business.
Throughout the year, I am going to share with you business and marketing concepts that can be applied to your own life - and that if you apply these concepts (as I have), you will have an edge over others.
Yes, quite a few writers have applied business metaphors in their concepts of wealth creation. Perhaps the most popular would be Robert Kiyosaki who teaches about the importance of understanding the business concept of cash-flow and knowing the difference between assets and liabilities, which are critical terms in finance. You may also have heard about the marketing concept of branding being applied to a person especially by HR experts or those coaching on personal development. Don't worry if you have not heard about these writers - I will explain more later.
What I am advocating is not reinventing the wheel but literally applying the world of business and demonstrating its relevance as a powerful way to being successful in life, while leveraging on concepts that are already there.The same factors that make a business successful or a failure are the same reasons that make a difference whether you make it or break it in life!
So start thinking about the business model you want to adopt in life. According to Wikipedia, a business model describes the rationale of how an organization creates, delivers, and captures value - economic, social, or other forms of value.
What's your business model in life?
It's 1st Jan, 2011. I am writing this blog to share with everyone a concept that I have been researching for the last five years. It is called the Business Model of Life.
I firmly believe that if you want to be successful in life, you have to run your life like a business.
How often have you heard this statement: “It’s just business, nothing personal”. What if I told you that it IS personal as it concerns YOUR BUSINESS – because “Your life is your business”. Nobody else can run it except you!
Whether you are conscious of it or not, the life of each and every one of us revolves around some sort of business-related activity, and how you successfully conduct and handle these transactions will determine your own success. I call this the Business of Life.
The Cambridge dictionary defines a business as “the activity of buying and selling goods and services”. Even our everyday language is filled with business talk or metaphors. Examples are: “You should invest some time in …”, “What was your pitch to him?”, “Did he buy your reasoning?”, “try negotiating with him”, “Why didn’t you sell him your idea?”
The fact is that many tasks we perform in our lives are akin to business transactions - even outside our work place. We get paid in kind or cash in return for doing something or offering a service – whether we are at home or school.
At home, parents invest in the future of their children in the hope they can give them a better life. They hope to get rewarded with good returns when their children grow up and become successful, allowing them to retire comfortably.
At school, you earn good grades if you study hard. Getting poor results is the consequence of a poor performance in examinations - which simply means lack of preparation. You get what you deserve. The more time you invest in studying, the better the results.
Life Revolves Around Business Transactions
Yes, life revolves around business transactions such that to get something, we must give or offer something in the first place that is of value. Sometimes what we get does not meet our expectations and so, we get disgruntled or unhappy. Other times, we get more than what we bargained for.
This is even more evident in our working lives. At work, you get paid what you are worth. What you are worth is the result of your performance, academic and professional qualifications, experience and competency as well as your employer’s perception of your contribution and value.
In fact, you are getting paid for offering a service to your employer or customers whether you are a doctor, lawyer, engineer, businessman or teacher. That means that YOU are your own business. What you offer as a person and get paid for are the products and services that you own, and you alone will profit directly from it. You alone decide what this is and what value it can bring to your customers – in this case, it’s your employer.
There was even a newspaper report that suggests that one can put a business value on the household chores which housewives provide. According to a poll of 4,000 housewives, the average mum works for nearly nine hours a day every day. If she were to be employed doing these same household errands, the amount would be almost £30,000 a year when the average annual UK wage is £23,000.
The business of being you is not something people often think about. The conventional thinking is that a business refers to a formal business entity - sole proprietorship, private business or public-listed company.
YOU are the Business
But stop for a moment and reflect. You are currently an employee to the company you work for - big or small. Now what if tomorrow, you decide to start your own business and ask your same employer to hire your services, offering the same services you provided as an employee. This could happen if you are a consultant, an engineer, a lawyer, a PR specialist, or a teacher. It is still the same you, except you are not being paid as an employee any more. It is now your business entity that is transacting with the company you worked for. Nothing has changed except how the transaction is being recorded.
Get the idea? YOU are the business.
Throughout the year, I am going to share with you business and marketing concepts that can be applied to your own life - and that if you apply these concepts (as I have), you will have an edge over others.
Yes, quite a few writers have applied business metaphors in their concepts of wealth creation. Perhaps the most popular would be Robert Kiyosaki who teaches about the importance of understanding the business concept of cash-flow and knowing the difference between assets and liabilities, which are critical terms in finance. You may also have heard about the marketing concept of branding being applied to a person especially by HR experts or those coaching on personal development. Don't worry if you have not heard about these writers - I will explain more later.
What I am advocating is not reinventing the wheel but literally applying the world of business and demonstrating its relevance as a powerful way to being successful in life, while leveraging on concepts that are already there.The same factors that make a business successful or a failure are the same reasons that make a difference whether you make it or break it in life!
So start thinking about the business model you want to adopt in life. According to Wikipedia, a business model describes the rationale of how an organization creates, delivers, and captures value - economic, social, or other forms of value.
What's your business model in life?
- Are you a one-product company or an all-in-one business?
- Is your life's business based on a low-cost model or do you deliver high-value professional services?
- Is your basic business model revolve around making yourself successful through a direct sales model where you sell direct to your customers (your boss or management), or do you rely on distributors (that is, others to do it for you)?
- Have you adopted a "bricks and clicks" model, where you make money not just through "bricks" (offline/traditional business) but also though "clicks" where you also earn supplementary income online?
Subscribe to:
Posts (Atom)