Secrets of Successful Companies

Ever thought how such small business ideas make it to multi billion dollar companies? Look at Google, Apple, Microsoft ~ their journey is from Garage to Grandeur. I would like to talk about some simple, but compelling factors that have led to this phenomenal growth. These are even applicable to Small and Medium Businesses.

1. Cheerful Hands Make Thriving Business

Its all about your team!

How your people feel about working at your place is a significant driver of success. A great work place would have happy employees and building a great work place isn't the job of HR department anymore. After you examine carefully, you would realize that even Top management has a hand in building a great work place.

2. Money isn't everything

Business isn't always in need of Vitamin M

From my evaluation i have found that most successful companies have been self funded by the founders during the initial stages. I read somewhere that Scott Cook (founder of Intuit) was turned down by more than 20 Investors. So strong was his passion that he went ahead without any Venture Capital investment during the initial stages. All that is needed is the right vision, commitment to get things done and the right people for the right job. Even Larry Page and Sergei Brin had put in their own money to develop the prototype for Google Search Engine. Later they were funded a $100,000 by Andy Bechtolsheim.

3. Talent is Contagious

Ordinary People Can Do Extraordinary Things

Create systems and processes that would help people grow in what they are doing. Don't look for extra ordinary people to do extra ordinary work for you. Instead, i have seen that its all ordinary people who have achieved extra ordinary things in Successful Companies. As a business owner, all you need to do is create a right platform for your people to grow their talents. I have read somewhere that Google encourages its employees to dedicate 20% of their time on things that are not in their Job Description. Excellent products and ideas like Google Mail, Google Adsense have come out of this practise.

"We built this company hiring who we could afford to hire," said Lee Hein, a regional vice president at Fastenal. "What we found was that the average company today doesn't have a clue what people are capable of if you believe in them."

4. Change with Changing Situation and Circumstances

Its not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.

Successful Companies are always open to changes and they have done some critical changes in them (which has mostly received criticism) to be what they are today. They have done things no one could have imagined possible. Look at Microsoft, during the early 90's Bill Gates chose to go on separate ways after IBM decided to work on its own Operating System Strategy. This was a turning point for both IBM and Microsoft. But back then Microsoft was a much smaller company than IBM. But Bill stood by his idea and he had full faith in it. Finally things worked in his favor and IBM's Operating System was shunned away by consumers who instead chose to be with the new Microsoft Windows platform. Today, Microsoft is a much larger company that IBM in terms of Market Cap.

5. Many Roads Lead to Success

Successful companies have had multiple strategies to achieve their goals and they have aggressively pursued all of them with equal commitment and dedication.

Top Signs that indicate you are a BAD BOSS

1. Your Staff Escapes / Hide from you

You would never or very rarely see people walk by your cabin door, even if your door happens to be at a point where your employees have to pass to get to the pantry area or the coffee vending machine. Maybe they would rather prefer to circum navigate through the entire office or may be the building itself, instead being at a risk of being invited by you for something. So in short they are trying good to avoid any conversation or interaction with you. This isn’t a good sign and you would soon see your projects breaking apart.

2. People would have Apprehension to Join Your Team

People generally won’t volunteer to be part of your projects or initiatives. Either your project or idea just sucks and they are afraid to tell this fact to you on your face or your idea is simply brilliant, but in the event of failure the consequences they could face are terrible to imagine. So you might end up under staffing your project with quality people. Some smart fellow might even come up to you and tell you that he is just aren’t capable enough to handle the responsibilities of your project, whereas at the back of your mind you do feel otherwise.

3. Bogus Reviews during Appraisals

During your 360-degre evaluations you might receive generic positive comments with little or no criticism at all. You might get comments like, “He works hard at everything, but he just couldn’t match up his own expectations. Your own standard levels are too high.”

4. “How to handle your Boss” Rule Book

Your staff has developed a guideline or a rule book consisting of list of ideas for dealing with you and they are quietly passing them around to new employees or new team members. A typical list of DO’s and DON’Ts might contain –

Don’ts-
Never suggest new and smarter ways of doing something, he might say……
Never counter his point, remember, HE IS ALWAYS RIGHT.

Do’s-
Act self-deprecating so he doesn't feel threatened.
Give him credit for things he has never done.
Praise him for all silly ideas he comes up with.

5. Your Former Employees just disappear

You have a list of people who have left your company for better career opportunities, but they rarely give your name as reference at new jobs. Either they just don’t trust you or they just don’t want to be in touch with you in anyway and wouldn’t want any of your thoughts to disturb them on their new jobs. If you feel such a thing is happening with you, it indeed high time for you to change.

6. People just come and go

You have extremely high attrition rates. People come to work on your project and they just go away without completing anything. They are just don’t like your attitude or the way you do things.

7. Your party invites receive no response

You plan to host a party somewhere for some occasion and you have send out invites to your staff members. They aren’t just RSVP’d. So you should understand why that is the case. You are just not a people person.

8. Your Tasks list is never completed

You have assigned a bunch of tasks to your team members, but in spite of everything, you just don't see anything significant happening in your project. Your staff is not giving their best shot and they are killing time by doing silly mistakes.

11 Business Ideas that can be leveraged from home using your Computer, Telephone and Internet

Idea No 11

Be a Specialist (e)Retailer - Selling homemade organic beauty products or customized T-shirts bearing a badge or picture isn’t a weekend hobby business anymore. In the current age of e-commerce and easy Payment Integration on small websites through PayPal, its relatively easy for small retailers to capitalize on the power of the internet to sell and market their products and to add up to their current income flow. Moreover you end up addressing a global audience and not just your local market. To make things even better, you can always sign up with Google Adwords and serve ads to the target audience that you choose. For as little as $10 a day as your advertising budget, you can get started.

Idea No 10

Be an Inspiration Speaker – Private Businesses and even Government agencies are constantly looking for new sources of inspiration for their work force. As far as you are concerned, no special education required, all that you need to have is confidence, good speaking abilities and ability to put across your message clearly to your audience. Set up a little website for yourself, get hold of a camera and record some of your good talks and put them up on YouTube. Sign up with a web conferencing service provider like GoToMeeting and start having your sessions over the web. However that could pose a little challenge initially, but then you have to get started somewhere. Parallely also hit your local market and start up with some Free no –obligation sessions. If the crowd loves you, you will have a fan following.

Idea No 9

Be an HR Consultant – Sign up on all possible Social Networking, Job related and people related web sites. Build your friend / contact network and collect as many resumes possible. After this contact some local / international HR / Recruitment Companies (via phone or email) and let them know what you have. Out of 10 you contact, I am sure 2 would be keen to avail your services. You can also take a different route here. Contact your local consultants and propose to them that you can source valid profiles for their requirements using the sources that they use (mostly that would be a login id and password for a Job Portal). Search diligently for some time, call the prospects and manage logistics remotely for them. If you think you are more capable than just this, you can always start a blog on ideas and advise for companies on creative ways to retain their talented employees.

Idea No 8

Be a Solo Specialist Practitioner – If you have spent a considerable time on learning some special skill (like dealing with Visa Matters, Patent Filings, Company Incorporation Services, Accounting etc) you can always start offering this service again. While doing so try to be inexpensive and good at your services. Remember, that you don’t have the additional cost of maintaining an Office and paying salaries to your staff. So be sure to pass this same cost benefit to your customers as well. Let me give you an example. I know a friend here whose previous full time job at a company was all about doing Company Incorporation and related Services. He now successfully runs a similar service from his home at 1/10th the price of what his previous company whom he worked for use to charge. All he bills his new customer is the relevant legal cost involved plus some amount for his time spent. That’s all. He has now branched out further and is also doing accounting and book keeping services for a few of his clients.

Idea No 7

Be a Ghost Writer for someone – If you are good at writing, then penning lines for someone else is a good way to earn money and have a reliable steady cash flow for yourself. You can register at websites like Guru, Elance, GetaFreeLancer (do a Google search for freelance writers; you will find many places where you can advertise your services). You can work on multitude of things ranging all the way from writing articles for websites, creating newsletters, write news items to maintaining someone else’s blog. You can do anything and everything that involves writing. So this one would definitely have a lot of scope.

Idea No 6

Be a Call Center Representative – This kind of work is ideal for stay-at-home moms, retirees and even students on Vacation. As more and more people are now seeking home based work opportunities, firms, big and small who had been off shoring such jobs are now instead filling it up with inshore customer reps. Set time schedules are maintained and based on that, incoming support calls are diverted to your home number. All you have to do is be patient and attend to calls sincerely and help your customers peacefully deal with their problems. Google around for this, I am sure you would find something that suits your needs.

Idea No 5

Be a Hotel or Airline Reservation Specialist - With an additional phone line, a computer, and an Internet connection, you could be booking travel reservations from your home for airline companies and hotels. In case you are not aware, for several years now, JetBlue Airlines reservation agents have been home-based. If you think you are capable to take more risk, you can always start up a home based Travel Agency. All you would need per added person is a Computer and a Telephone connection. Actually even an telephone won’t be required, you can always buy phone numbers from Skype and also make inexpensive outgoing calls using SkypeOut.

Idea No 4

Be an Independent Financial Analyst - Many people who start home-based businesses usually continue doing what they had been doing in their corporate job, but on a consultant basis -- and Financial Analysts are no exceptions. If you have the skill set to crunch numbers and present it in a way that is accessible to the public, you may be just as happy doing that at home as you would be in the office. I know a friend who is a specialist in Stock Market Investments and is now running several individual investment funds from his home. All he does is convinces people from his friend network to invest in his funds. Of course there are risk factors involved.

Idea No 3

Be a Graphic Designer / Freelance Programmer – There are hundreds of websites added to the internet on a Daily basis. Small and Large businesses are using the internet heavily for their brand building activities. This said, there is always demand for compelling graphics on website and ads. Likewise the skills required to develop web applications are also in demand. Go to Guru, Elance and GetaFreelancer, you would get an idea as to what I am talking about.

Idea No 2

Be a Medical Transcription and Billing Specialist – If you have some know how about the US Healthcare Industry, then you have loads of opportunities to work from home as a home-based medical transcription and billing specialist. You have the option to do work for independent physicians, or for larger medical firms that provide you with the necessary electronic programs to complete the work. Often though, the job requires additional educational training because of legalities with medical insurance. I personally know at least half a dozen people who are doing this work from home. However this can be a little taxing initially, but once you get a hang of it, things would be a lot easier.

Idea No 1

Be an Internet Marketing Specialist – Internet as a network is growing day by day and so is the number of people actively using it for their needs. Internet Marketing is a growing field and it’s something that every online business would need in times to come. Gain some skills on Internet Marketing like using Google Adsense, Google Adwords, Google Webmaster Tools, Google Analytics initially. It would give you a fair idea of what Internet Marketing is all about. Learn about SEM, SEO, PPC and CTR’s. Then start this off as a business for yourself. As usual you might have some challenges initially, but if you are a quick and smart learner, it won’t be hard for you to master it. I personally know a few people who have mastered this as a skill and are doing this as their full time home based work.

Why 99% of the start-ups fail?

1. Poor Implementation Plan

When you are the boss, the only place you should point fingers is at yourself. After all you are on the driver's seat.

Having a poor execution plan is a downfall of most startups that go bust. There are several ways how this can be avoided. First make sure you have thoroughly evaluated your skills and you only pursue those opportunities that fit your strengths. Most entrepreneurs who get blinded by greed or arrogance are more prone to getting in over their heads. It’s also wise to surround yourself with really talented people and someone who are not afraid to challenge your thoughts and decisions. Also, understand that you are not good at everything. You need to get a little disciplined as your business grows and don’t hesitate to hand over the reigns to a professional manager who can take your business to the next level.

2. No Practical Market

What if you launched a business and nobody showed up?

Each day, many entrepreneurs invest their money or their investor's money in a cool idea with the hopes that customers will magically appear once they open their shop. Look back, i am sure you will find loads of examples where you would see founders spending all of their time and money in developing their killer product without bothering to know whether their prospective customers would like it or not, or even whether they would need such a thing or not.

So do your research properly. Don’t hesitate to spend a little extra dollar to engage a market research firm. Or to get to know things first hand, roll up your sleeves and jump into this yourself.

3. Stretching Too Much

Give me a lever long enough and I will bankrupt my company.

Established companies are able to predict their future revenues over a period of time with some degree of certainty. Such businesses can make prudent use of leverage, both financial (debt) and operating (fixed overhead costs) to improve short and long term returns. Whereas revenues projections for early-stage companies can be all over the air. In this environment, it is dangerous to take on more amounts of debt or other fixed obligations (like rent, salaries, loan installments etc.). With no margin for error, if revenues take longer to ramp up than expected—as they nearly always do—you may find yourself handing the keys of your business over to your creditors.

It's best to keep most costs variable at first and use equity to finance your startup until your business has been around a while and you develop some confidence in your ability to forecast sales. Delay making investments or taking on fixed obligations as long as you can.

4. Under financing the Business

Maybe you should've waited to order that red Ferrari...

It's all too common to grossly underestimate the amount of time and capital necessary to reach cash flow breakeven, causing many promising ventures to shut down prematurely. Be conservative with your financial projections and plan on having adequate funds until you become cash flow positive.

If you don't have enough savings to cover the required investment, it may be tempting to launch the business anyway under the assumption that you will be able to obtain funding at a later date. While staging investment has its advantages (preserving the option to abandon, higher valuation and—therefore—less dilution, etc.), this strategy can backfire and leave you unable to get the money when you need it most or force you to negotiate with banks and investors from a position of weakness. It's often better to change the business model to bring required investment in line with available resources.

5. No Tangible Competitive Advantages

Never bring a knife to a gunfight!

Does your city really need another car dealer, burger shop, or a hotel? Entrepreneurs frequently start these me-too businesses because of their simplicity, modest capital requirements and looking at others making profits. Since most me-too businesses lack competitive barriers, it makes entrepreneurs extremely vulnerable to new entrants. Your competition would gladly cut prices to the bone to steal customers from you.

If you want your business to thrive, you need something that insulates it from competition. It could be a great location, a cool brand, proprietary technology, or a cost structure that cannot be easily replicated. None of these advantages is likely to be permanent, but they only need to shield you long enough for your company to take root. This will give you time to make investments that create additional barriers.

6. Competing Head-to-Head with Industry Leaders

Better sharpen your swords...

A sure sign of impending failure is an entrepreneur who plans to bootstrap his new business while competing directly against well-established market leaders. Large businesses have enormous resources to deter competitors from entering their markets. Big companies can undercut your prices, outspend you on advertising, and choke off access to suppliers and distributors. I strongly advise against making a frontal assault unless you have a world-class team and very deep pockets. Even then, your chances of success are likely to be disappointing.

7. Picking a Niche that is too small

Don't be a market of one!

Most small businesses compete successfully against larger rivals by specializing in a niche market. However, you still need to do your homework to be sure that the niche is large enough to support your business and that customers are not too expensive to find and serve. You may discover that niche markets can be just as fiercely competitive as the mass market. You need to figure out how fast your niche is growing and how much market share you will need to capture.

If your financial projections require you to hold more than a few percent of market share to remain profitable, be careful. Don't press ahead unless you can convincingly demonstrate to yourself how your competitive advantages will enable you to become the market leader.

8. Breakup of the Founding Team

Breaking up is hard on you -- and your company.

A startup can be a high-stress environment, especially when you are struggling to turn the corner before the lights go out. At moments like this, disagreements about the direction of the company or the division of profits among the owners can lead to a rift within the founding team. Because people wear lots of hats in startups, the sudden departure of a key executive can doom a fledgling organization. This makes it imperative to structure agreements so that the founders and key hires are treated fairly and that everyone's interests are closely aligned with the success of the business.

9. Poor Pricing Strategy

The price is right?

The most common method for setting prices is to start at the unit cost and then mark up the price to achieve a profit, so-called "cost-plus" pricing. Unfortunately, cost has little to do with how a product or service is valued by customers, which can lead to systematic under pricing. For example, if a widget costs $20 to manufacture, and you sell it to a customer for $25 when that customer would gladly have paid $35, you have left $10 worth of value on the table.

You should anticipate prices, based on the product's perceived value to customers, determine the cost structure, not the other way around. Consequently, pricing strategy and customer value should be considered early in the planning of a new business, before investments have been made that will determine the cost of a new offering.

10. Growing too fast

What goes up...?

Growth is generally regarded as an indication of business success, but uncontrolled growth can—and does—kill entrepreneurial companies for two primary reasons. The first is that businesses need systems and infrastructure to scale properly, but few invest the time and effort to lay the foundations for growth in those first hectic years. That's too bad, because things tend to spin out of control when you put the pedal down. This can be especially problematic for companies that receive a large infusion of outside capital. It's the equivalent of trying to break the land speed record by strapping a jet engine onto a ski boat. Don't be surprised when the when you have a head fall.

The second reason is that top-line growth requires additional investments in fixed assets (warehouses, machinery, trucks, etc.) and working capital (inventory, accounts receivable, etc.). At controlled rates of growth, companies are able to finance incremental sales through internal cash flow. Hyper growth, on the other hand, can suck up large amounts of cash, forcing businesses deep into debt or bringing the whole enterprise to a screeching halt. Many times, business owners are not even aware of the impending collapse, because they focus on profitability (as depicted on the income statement) rather than cash flow. Never forget that cash is the lifeblood of your business!

11. Poor Hiring Strategy

You throw peanuts, you will get monkeys...

Since we talked about cash being the life blood of your business, having right people are hearts here pumping out this life blood. Don’t be cheap on your people. Work hard to make smart practices to motivate and retain your key people and business drivers. Be extremely careful while doing the same. Don’t over do anything and don’t under do as well. Reward your people whenever and wherever possible. Pay the right price for skills that your people bring on the table. If they sound too cheap to you, probably they could be monkeys, just trying to jump on you to grab your fruits. At the same time, don’t under pay your people.

12. Doing the right thing

You can fool only a few times, not always….

Whatever you do, make sure you do it right. Don’t cut corners to save cost and there by compromise on your product quality. Focus more on building a the customer base and try hard to keep all your customers happy. Invest in building good sales and post sales support team. One happy customer will bring in 10 more prospects for you. And those 10 happy customers can bring you many more prospects. Don’t think of making some quick bucks initially. Mentally be prepared to lose your money initially. No matter what, never ever compromise on your product quality.