Entrepreneur’s Diary #99 – The Golden Rule for Entrepreneurs

Now that my own “live as an entrepreneur” is about to end, I probably found the ultimate success concept for entrepreneurs?
If there is indeed such a thing, then it can only be: you have to rigorously question all your relevant decisions measures, following the following concept:

1 What use is it for the business?

2 How will the employees benefit from it?
3 What good will it do your customers?
4 What damage will it do?

The constructive questions one through three are of central importance for all activities we enter into. Because entrepreneurs enter into something.

The fourth question is a “counter indicator” you should once again answer just to be on the safe side. In order to lay open the (potentially) destructive side of all measures, as well.

Question one will almost automatically answer positive if numbers two and three render constructive results. Regardless, it is very important, since it emphasizes the important requirement which alone makes a functioning enterprise possible.

If questions one to three give you a rich harvest and question four has been answered in the negative, then you usually fulfilled another requirement sufficient for the next step towards success.

Otherwise, you should quickly terminate your intended measure and analyse how you could ever have entered such a misleading path.
There are other criteria you should also distrust.

  • There is no alternative to the decision.
  • This is how it is always done!
  • The competition does exactly the same.
  • We have to do it in order to minimize the cost.


As soon as you hear this kind of sentences in an enterprise, you should immediately start being sceptical. They are a sure sign for helplessness and lack of creativity 



“There is no alternative to this decision.“

Stating that there is no alternative is the end of entrepreneurship. If you arrive at this point, you should resign.

”This is how it is always done!“

In other words: we have to do it in this way because everybody else does, too. A closer look, however, will reveal that actually not everybody does it in this way. There are quite a few exceptions where it is “not done exactly in this way” and where, surprisingly, as a general rule, you will find more successful business.
Let me give you one example: the tendency towards certifications. There is no law that says you have to get all business processes certified according to ISO. And there are many successful enterprises that never got themselves certified. Regardless, many follow the doctrine: “certify”. And as soon as they have managed ISO 9001 (mostly through corruption), they have to introduce the next level.

To me, such doctrines sound sadly like the general problem people have with morals. There is a “higher rule” which has to be adhered to. “Moral” arguments are a trap when it comes to decisions relevant for business. A trap you will easily get caught in. They have no right at all to be guiding your actions and are a special kind of threat for the enterprise.

”The competition does the same.“

The competition starts a useless advertising campaign, abuses its employees, introduces SAP, expands to Australia, suffers losses… 
Is there any reason for your enterprise to do the same? Of course, this is nonsense! After all, the word “competition” includes “differentiation”! Consequently, you have to say: “We are not like the others!“ And hopefully, we are better.

”We have to do this in order to minimize the cost.“

Elaborate initiatives that are supposed to minimize the cost are something you should always distrust. Especially if they are expensive and necessitate strong measures. More often than not, the cost of the entire affair is calculated lower than it will actually be. Big projects – also those that are supposed to reduce costs – are usually a lot more expensive than planned. As a general rule, the amortisation process will fail. Besides, the collateral damage caused by such measures can and will also always be approximated. Consequently, you mostly get follow-up projects for which the same is true. How easily will a devilish vicious circle begin…

Trick:
Here is a trick I would like to recommend in this context:


Dear entrepreneurs, why don’t you do a “negative concept experiment”? Take the perspective that you actively aim at destroying your enterprise! More often than not, you will discover very interesting ideas. For instance, a creative service provider will simply have to employ the wrong kinds of people. It is a guarantee that the enterprise will slowly but constantly “go down the drain”.

And then compare the result of your experiment with what you actually do!

RMD
(Translated by EG)

P.S.
For more articles on entrepreneurship, click here: Drehscheibe!

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