Three Indicators You Are Not Managing Your Enterprise For Success and Three Signs Your Enterprise Needs Financing
I am asked all the time…”How do you know when you are on the right path with your business?” The answer is simple I use my Three Plus Three Equals The Brass Ring Method or P+P+P+C+CR+CFO=TBR. “What is that?” you ask. Well is a formula that has not failed me in thirty five years of running and building many successful enterprises. This method is so critical in fact I have decided to put these simple lessons in a new teaching format and formal instructional guide called “The Next Step On The Obstacle Course… Managing For Success and Financing Your Enterprise For Profitability”. But more about that later. I want to share with you just the basics of my method. I think at least in the interim, until I send you the guide that it will help you immensely. Keep reading and you will see.
How To Finance a Business
In my corporate finance consulting practice, I teach. I teach the client about the hundreds of methods and tools to finance a business, when each is appropriate and how they work. I actually, in most cases, spend more time teaching than executing on the process of financing their business on their behalf. However I feel that when a client knows all he/she can know they are able to make informed and ultimately successful decisions. Read more to learn about the formula.
How to Manage a Business
On balance, I often find myself teaching basic management along the way. In the chaos of running your own business sometimes the basics get fused into the confusion or lost in the white noise of attempting to control what is most of the time out of control. So I find myself teaching techniques about a “Controlled Crash Landing” or how to select “The Right People, The Right Partners and The Right Professionals” . But it is all part of what I do in the end. So here are the basics of what I call my Method. I guarantee it works and it is so simple!
An enterprise that manages to achieve success, consistently evaluates the people inside the organization. People are the key both inside and outside the enterprise that perpetually influence a desired successful outcome. First you must have the right people assigned to do the right tasks inside the enterprise and you must be doing business with the right people outside the organization. Also you must have the right professionals around you involved in the enterprises daily activities. And if you have a partner then the partner must be the right choice. You cannot operate a business with a partner as a handicap. So choose the right People! Is the first step for managing your business in order to achieve success. But there is still more.
I often get a kick out of the number of lists my wife makes on a daily basis. But guess what? It is what keeps her on track to manage a multitude of tasks successfully. She plans and plans and plans yet even more. So in managing your enterprise you must plan. You also must understand that your environment is dynamic. Therefor plans change. You must therefore keep your plans up to date. The second most important element for managing your business to achieve success is to plan and plan often and adjust your planning as the environment demands. This does not mean you change your goals or priorities. This means you are just maintaining a dynamic posture at all times. This point is important but there is just a bit more to add.
I talked a lot about projection and visualization in my book. Projection is a valuable tool that should be used in the enterprise environment every day. You must visualize your plans and aspirations in your mind continually. It is a tool that allows you to keep your eye on grabbing the brass ring. (Here is a hint in the previous sentence…the brass ring is the TBR of the formula) Projection is a key tool to keep you focused. Use it. Keep going!
92% of American Enterprise Needs Financing
A recent study revealed that 92% of all American enterprises are in some need of financing. However of the 92%, 88% do not know how to acquire the financing or for that matter what is an appropriate financing mechanism for them. Wow! Here are the basics to manage your enterprise for profitability. You are now in the home stretch.
First if you are managing cash flow more than you are managing the business then you need a more appropriate financing tool. If cash flow is your constant focus then you need help. Cash flow should consume 5% of you time. Not 95%. More than 5% then you need to evaluate all the elements that are causing the conflict. Too much time focused on managing cash flow will distract you from recognizing opportunity and being able to exploit it. More about that in a minute. Are you starting to see the formula take shape?
Second if credit with your suppliers is problematic then you must again evaluate the situation. The credit terms with your suppliers should complement the credit with your customers. If there is a conflict then you need a financing solution. Leaving this condition unchecked will ultimately lead to disaster. Constantly evaluate the condition of your entire enterprise credit landscape.
Can’t Finance Opportunity?
Finally, if you cannot finance opportunity then “Houston we have a problem!” Exploiting opportunity is the key element to ultimately grabbing the brass ring. If this is a constant challenge then you must immediately seek a financing solution. The proper financing tool will allow you to do just that, exploit opportunity. Thus financing opportunity and exploiting opportunity are two sides of the very same coin. You should never discover that you can’t finance opportunity. If you do, then you need to adapt and fast! Never allow the answer to that question ever to be Yes!
Without using the aforementioned measurement tools related to financing you cannot achieve profitability. Without using the tools for management you cannot stay The Obstacle Course with having continual collisions with disaster. In conclusion here is my Method in a nutshell;
- People (P)
- Planning (P)
- Projection (P)
- Cash Flow (C)
- Credit (CR)
- Can’t Finance Opportunity?(CFO)
Now you see what or P+P+P+C+CR+CFO=TBR means. You have all the puzzle parts now. And it is simple If you follow my Method you will ultimately grab the brass ring or TBR. I want you to be successful. I am sure you will find these simple little rules easy to follow and very useful. They may seem too simple but sometimes simple is best. Getting back to basics can be the most refreshing thing you may do to stay The Obstacle Course. I’ve expanded on the Method in the video below. Good luck!
Stupid Without A License
I will be giving you more information in the form of a Free E-Book coming out very soon “Stupid Without a License”. These are stories about my clients that have not followed the Method or formula as I have laid it out in this blog. You may think it a bit negative to teach from a negative perspective. But we are all grownups and we have all been around. These stories will amaze you. They are all about more signs you need to look for in order to avoid disaster. Keep them in your mental hard drive and you will see they will become useful over time as points of reference.
Managing For Success and Financing Your Enterprise For Profitability
In just a few weeks you will be able to get a copy of “The Next Step On The Obstacle Course… Managing For Success and Financing Your Enterprise For Profitability” from The Obstacle Course website. After thirty five years I felt compelled to provide the basics to everyone of what has worked for me time and again… P+P+P+C+CR+CFO=TBR but in far more detail and in a simple teaching format along with an audio CD and DVD of all the best Just Ask George Radio shows that help to illustrate the teachings in the guide. More to come very soon. All The Best!