Read The Millionaire Fastlane Online
Authors: M.J. DeMarco
Tags: #Business & Economics, #Entrepreneurship, #Motivational, #New Business Enterprises, #Personal Finance, #General
CHAPTER 39: BURN THE BUSINESS PLAN, IGNITE EXECUTION
Having the world's best idea will do you no good unless you act on it. People who want milk shouldn't sit on a stool in the middle of the field in hopes that a cow will back up to them.
~ Curtis Grant
The World Reacts How It Reacts
The world reacts how it reacts. If you think 1 + 1 = 2 and the world tells you it's 3, you have to let it be, despite what your preconception tells you. When it comes to your ideas, your plans, and your business, you NEVER know what works until you put it out to the world. In business, I call this “putting it out into the box.”
Anytime I launched a new service or feature at my Web site, it was an experiment to see how the world reacted. And with each experiment, I'd be surprised. “This new site design is going to be a blockbuster!” And then, wham, hundreds of emails pour in from disgruntled visitors who want to string you up on an oak tree and castrate you.
The ultimate judge-and-jury of ideas is the world and the marketplaces that serve them. If the world likes your offer, they vote by giving you their time, their thoughts, or their money. If they don't like your offer, they withhold their money and look elsewhere. And the really pissed-off ones? They email you or write a blog post labeling you an idiot.
The Tribe Has Spoken
My Web site needed a redesign, and I spent six weeks creating a new look. I was excited, and the world was going to love this design-it was clean, user friendly, and showcased my design prowess. And then I launched it. And the world hated it. Complaints poured in. My site's bounce rate (people who visit one page and immediately leave) skyrocketed. My conversion rate plummeted to virtually nothing. I went from 1,200 leads per day to barely 500.
The tribe had spoken. Despite my investment in that redesign, I immediately reverted back to the old version and trashed six weeks of work. My golden child was a golden failure. The world heralded a sign, I read it, and then reacted. You see,
the world tells you which direction you should be going at all times
. Heed the signs. How do you get the world to tell you? Put your executed ideas and concepts out into the world and let it tell you. Paint the world with your brush of genius so they can tell you how right or wrong you are.
Put your executed ideas out into the box.
Dead College Professors Roll Over
The world doesn't care about ideas; it only reacts to them. This simple fact pokes a hole in one of the sturdiest institutions of business practice-business plans. Academia will be outraged at the atrocity. Be prepared for the ultimate business sacrilege:
Business plans are useless
. Yes, I said it. Business plans are useless because they're ideas jacked-up on steroids.
Unless you count a barbecue-stained Hooters napkin, I never had a business plan. In fact, the best business plans are ad-hoc scribbles on napkins, old Arby's bags, Baby Ruth wrappers, and voice memos on your iPhone. The problem with business plans is that they are another manifestation of potential speed. Like supercharged garage queens, they aren't any more powerful than the lawnmowers that sit next to them.
Business plans are useless until they are married to execution.
And guess what happens then?
The moment you execute, the world will tell you just what I told you: Your business plan is useless. The market (the world) will steer your business in unimaginable places that will violate everything about your business plan. If you interview any entrepreneur who has been in business longer than five years, they'll tell you that they started off with intention A and ended up at intention B. They sell product X and ultimately end up selling product Y. The world tells you where you should be going, and no, the world doesn't give two pence about your 150-page PowerPoint business plan.
Facebook started as a college-crowd social network. It morphed from a niche site into a mass-market social network that serves every generation. I started my Web site as a directory, and it transformed into a lead-generation portal. The world has the incorrigible power to corrupt business plans the moment the idea is transformed to reality.
However, this does not exempt financial analysis. A blind jump into a business without knowing the specific financial constraints that govern that business would be foolhardy. When I made the decision to create a limousine Web site over a limousine company, I did a financial analysis. However, I didn't get entangled in the intricacies and paralysis of planning, which is no substitute for execution. Figure out what needs figuring and just go do it. The world will do its job and tell you the directions to travel.
But I Want Venture Capital!
I know I know: I can hear the objections already. Without a business plan, how will you get venture capital? Or investors?
You can't.
Without a business plan, you won't get funding. But please, take heart, the issue isn't your business plan nor will it ever be your business plan.
The best business plan in the world will always be a track record of execution
. If you are a seasoned executor, suddenly people will want to see your business plan because they know you have the fortitude to execute. If I received a business plan from an entrepreneur who sold his company for $20 million just two years earlier, you can bet your sevens I'd read it.
The value is not the plan, but the person giving it and his track record of execution.
Today, I know a circle of people who would read my business plan if I gave them one. They know I have a track record of execution that validates the business plan. If you don't have a track record of execution, the business plan is a worthless piece of Kinkos-bound pulp.
Get Funded with Execution, not with Business Plans
I started my company on a shoestring and 900 bucks. No investors, no funding, and no help. The fact is, had I wasted 150 hours on a 95-page business plan, no one would have read it because I was unseasoned: I had no money, no track record, no races entered, no finishes, and no races won.
However, as I built and grew my business, something miraculous happened. As my ideas crystallized into tangible assets that could be consumed by the world, suddenly I became the approachable asset. Venture capitalists and angel investors
called me
-I didn't call them. Suddenly, people wanted to see my business plan. Why the sudden change of heart? Wasn't I the same guy just years earlier? Sure, but instead of an idea on paper,
I had a tangible concept that reflected execution.
A common question on the Fastlane Forum is “How can I find investors for my idea?” It doesn't matter if the idea is an invention or a great new Web site, my answer is never what these people want to hear. If you want investors, get out and execute! Create a prototype! Create a brand! Create a track record that others can see or touch! Dive into process. When you have a physical manifestation of an idea, investors will open their wallets. Heck, be good enough and they will be fighting to give you money.
You see, when you have nothing except 120 pages of text, charts, and graphs, that shows organizational skills, not execution. Angels to private equity never invest in business plans-
they invest in people with track records of execution
. That is your best business plan! So if you really want to get funding for your business, get out and make your idea tangible. Give investors something they can see, touch, and feel. Give investors a glimpse of your execution, because that is what creates speed on the Fastlane.
Chapter Summary: Fastlane Distinctions
CHAPTER 40: PEDESTRIANS WILL MAKE YOU RICH!
If you do build a great experience, customers tell each other about that. Word of mouth is very powerful.
~ Jeff Bezos
The Bishop in Your Chess Match
When life is tough, we seek the counsel of priests, rabbis, or pastors. They are the “go-to” guys of life's problems. Yet when it comes to your business, who is your go-to guy? Who is on the frontline with your customers? The bishop in business's chess match is your
customer service
, and how you treat the people who buy your product or service. The objective of customer service in any business should serve one function, similar to our men of the cloth, and that is to help, support, and resolve.
My Internal Roadmap: My Black Book
The Fastlane roadmap was my compass for wealth, but I also had an internal roadmap, and no, it wasn't my business plan. It was my little black book. Nope, my black book wasn't a treasure trove of telephone numbers from female hotties but a written record of all complaints, grievances, and issues my business experienced daily. This book has served as my guide for over a decade.
When business owners hear a complaint, most of them ignore it. Most of them pass the buck to an employee and pray the issue goes away. Not in the Fastlane. Complaints are a beautiful thing. They represent free feedback and expose unmet needs in your business. They represent the journey's road noise.
I logged my customers' complaints because they provided a kaleidoscope into the mind of my customers. One complaint meant there were 10 others who felt the same way. When my black book accumulated similar complaints weekly, I had to evaluate the issue and take corrective action. Complaints are the world's whispers hinting the direction you should be moving.
The Four Types of Road Noise (Complaints)
When the world unleashes its opinion on your new Web site, product, or concept, what should you expect? What should be addressed and what should be ignored? There are four types of complaints:
Complaints of Change
Take anything that people love, change it, and you'll have a riot at the steps of your business. Remember when Coke changed its formula? Oh heavens! How dare they! Remember when Fox canceled the feel-good family drama
Party of Five
? Dear God! The world hates change, and it's a natural human behavior to resist change. Change endangers comfort, expectancy, and security.
When I redesigned my Web site and hundreds of complaints poured in, I expected a certain degree of resistance. It's normal. In fact, every redesign I've ever done in 10-plus years was met with resistance. The question for critique was, how much was normal? And how much was legitimate?
Complaints of change are the least informative and therefore are the ones most difficult to decipher. For my redesign failure, data confirmed that the complaints were substantial. Bounce rates tripled and my conversion ratio suffered. I had to suck up the failure, revert back, and start over. When you change, there will be complaints. Guaranteed. And yes, not all of them are actionable simply because human psychology is in play, not the integrity of your work.
Complaints of Expectation
Complaints of expectation occur when you negatively violate the expectation of your customer. You convince them to do business with you, they expect something, and what you provide doesn't meet that expectation. This happens because either your service failed or their expectation was malformed by a deceptive marketing strategy. Regardless of which, both expose a problem. And it's your problem, not the customer's. You either need to do a better job in fulfillment or a better job in managing their expectations.
“Your service sucks.”
I heard that complaint hundreds of times and yet my company not only survived, it thrived. If my service sucked and I was being told it sucked, how did my business succeed? I dug into the claims.
Advertisers who complained, “Your service sucks,” didn't use my service as intended. Their expectations were malformed. I owned a lead generation service that sent email leads to clients. The thing about leads is they must be followed. You don't book leads after they sit in your email box for three weeks and then answer them like a first-grader. You don't book leads when you log in to your account once every millennium. Yes indeed, my service sucks when it isn't used properly.
Instead of targeting my customer, I sought to better manage expectations. I made it abundantly clear that leads are only as good as the person following them. Unfollowed leads go unbooked. Also, because most of my customers weren't communicatively savvy, I launched educational campaigns to ensure professional responses. If I couldn't manage the complaints, I could manage the expectations. I knew if my customers were making money, they'd keep paying me.
When you order sea bass at a restaurant and it's served raw, your expectation of a well-cooked meal is violated. You complain. Yet, for the owner there is a bigger problem: Why was it raw? Is the chef incompetent? Does the kitchen process need a retooling? Complaints of expectation expose operational issues, marketing misinformation, and/or product problems.
If you hire a home remodeler who advertises “guaranteed bathroom remodels in two weeks” and the job takes two months, your expectations are violated and either the marketing campaign needs to reflect that truth, or the operation needs to be retooled to fit the expectation. Either way, operations or marketing needs change. Complaints of expectation violate customer expectations negatively.