Premature Diversification

Wednesday 12 December 2012 @ 10:13 am

Rich Christiansen The past several weeks I’ve been preparing for a trip where we will represent several up-and-coming, exciting brands for one of my companies. Through the course of these activities I’ve been exposed to several very creative and very innovative ideas and concepts.

There’s one company in particular that has received an extreme amount of attention. They were featured on the television show Shark Tank and were indeed one of the winners. They won again at a statewide entrepreneurial conference and have received an excessive amount of media and exposure. As I met with these young entrepreneurs I was exhilarated but also dismayed in our very short meeting. Their high-energy level, exuberance of entrepreneurship, and the zeal for which they were attacking opportunity was exhilarating. However I was dismayed as I saw what they were doing. Indeed they had come up with a very novel creative market concept that had been broadly embraced and was getting them a lot of attention. What did they do with it? Rather than dig deeply, rather than fully explore all the channels, rather than totally take advantage and captivate this corner of the market they’ve instantly started to branch out and add all sorts of diverse products. For instance they were scheduled to fly down to meet with a celebrity’s daughter the following day to start a new line of handbags. They’re developing cell phone technologies, literally exploiting the small channel that they’d developed on ancillary things that haven’t yet proven success.

Indeed my one of the entrepreneurs that I really respect is David Norton who will often make the statement that the reason for failure in small businesses is premature diversification. I personally think that the number one reason is cash flow, but I agree with David that the second reason is premature diversification. If I were to wind the clock forward several years I would suspect that these young entrepreneurs would learn this lesson (hopefully not too much the hard way).

In the early stages of our business we need to find something that works and do more of it efficiently and effectively and fully develop the channels and make sure you have adequate conversion before you diversify. It’s not to say that diversification is not appropriate, it’s just doing it at the right time.

Go forward, prosper, and win in your business.

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Combo Meal Post

Tuesday 23 October 2012 @ 2:02 pm

Today’s post is a combo meal. You get two for the price of one largely because I couldn’t decide which one to blog on so here goes both.

My first concept is all about working hard and playing hard. I believe that working hard and then playing hard is far more efficient and productive than just working hard all the time. Each year I schedule a hard working day with my sons, particularly my younger sons. I do this to give them the experience of working on a hard project, jumping in, and just tackling something really difficult. I then make sure to always follow that up with a fun play experience.

The past several days I had my wife assemble a list of every nasty, disgusting, difficult assignment that she could come up that needed to be done for our rental properties. I took my two youngest sons, Timmy and Alex, which I affectionately refer to as my “Little Men” and we embarked on chasing down all these projects. Indeed we worked our guts out but actually had a really good time doing it. There’s a great personal reward in seeing a project through to completion.

After we finished our projects we went swimming in a natural spring pool, had a great dinner, and went crawdad catching. Now for those of you who have never tried catching these little critters there are a couple of things you need to know.

You can’t catch these things with your bare hands or even a net. You’ve got to toss a stinky, rotten piece of meat (I prefer bacon) on a string out in the warm water, count to ten, and then pull it in. This year was particularly good. Every pull we were catching anywhere from seven to fifteen of these little crayfish. My sons were absolutely delighted as they pulled in each catch with these little guys hanging on with one pincer and snapping with they other saying, “You give me back my bacon!”

This leads to my second concept: There are important things you have to let go of in your life in order to succeed.

There are a lot of life lessons associated with this. I’ve found myself acting like these little crayfish at times by hanging on too tightly to business ventures and projects. Things that would normally scare me and make me swim upstream to safety will actually grab my attention with a piece of stinky bacon. I hang onto that piece of meat, snapping away until something bigger squashes and kills me.

It is important that you give up bad personal and business habits and recognize when you’re hanging onto a piece of moldy bacon. We have a little business right now with one of my groups where we’ve been snapping away at it for nine months. We’re just not getting any traction. As a matter of fact we’re ignoring some other, more meaningful opportunities and I’m right on the verge of labeling it a bad piece of bacon and giving counsel to let it go. Now there’s a fine balance of being doggedly determined and then there’s pouring all your focus into a rotting piece of bacon. Do NOT be as those crawdads and hanging hang on until your very death when all you have to do is let go and live to swim another day. 

In closing here are the two key important business lessons of today:

Lesson #1: Work Hard. Play Hard. It’s far more productive than just working into oblivion.
Lesson #2: Let go of the caustic things in your life that are actually causing destruction, both in your business and personal life.

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Free Teleseminar: Rich Dialoging with Rick Sapio on Value Gatekeeping and Saying No.

Friday 12 October 2012 @ 2:49 pm

I’m really excited to announce that on Tuesday October 16 at noon (Mountain Standard Time) I will be interviewing and dialoging with Rick Sapio about Value Gatekeeping. In both books I’ve written I’ve discussed the importance of saying no. In Bootstrap Business I say that the number two reason for failure in small businesses is premature diversification. In other words: doing too many things and not being able to effectively say no to the things that are distractive. Rick Sapio is heavily quoted in my book The Zig Zag Principle and indeed a brilliant mind on this topic.

What a rare, unique opportunity for you to attend this free teleseminar and learn from Rick, the direct master of the concept of value gatekeeping. Learning the in’s and out’s of value gatekeeping allows you to set filters that keep the crap out of your life while allowing the important things to get through.

Again, this call will be on October the 16th and will start at noon Mountain Standard Time and will run from an hour to an hour and a half. To sign up for it simply click the link below and register for the free event. You’ll receive an email with the information and the option of attending the seminar via telephone or web.

https://bfs.infusionsoft.com/app/form/valueswebinar

I look forward to seeing you on the call and I’m also looking forward to learning more from Rick about Gatekeeping. See you Monday!

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The Pendulum Swings

Wednesday 3 October 2012 @ 2:12 pm

For the last five years I’ve watched with fascination at what is known as the Pendulum Principle. This concept was developed by Roy Williams, the Wizard of Ads, and widely propagated by Michael Drew, my book agent for Zig Zag.

The concept of Pendulum is that every forty years the pendulum swings from a civic society or a group collaboration of everyone working together to the other extreme of an individualistic society then swinging back forty years later. Each time a society reaches a pinnacle the youth rebel and they start bringing the pendulum back.

This book goes through statistically showing that this has happened over and over for hundreds and hundreds of years just exactly how we swing between a civic society and an individualistic society. Interestingly enough we just crossed over into a civic era again and I watch with great fascination in being able to predict and to see the trends that are occurring that wouldn’t have occurred ten years ago. It’s reflected in our media, it’s reflected in our music, and it’s reflected in our social behaviors.

Pendulum released this week and this is a book I can’t wait to get my hands on to re-read. I would suggest that this is also a book that you should be reading if you’re attempting to have a crystal ball that lets you see into the future to understand the behavior patterns that are occurring and trending in our society.

Understanding this helps you dramatically predict what to do in your business to have a higher probability of success. Again, the name of the book is Pendulum and you can click on the link below to get to this book.

Happy Reading.

Check out Pendulum here.

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Monday 1 October 2012 @ 10:57 am

Good morning, everyone! I’m coming to you live from my office today! It’s been a little while. Today’s topic was important enough that I wanted to go face to face with you. I’m so thrilled with the outcome of what we’ve seen from the Zig Zag Principle. Only one in ten small businesses were succeeding. The people that are using Zig Zag Principle and have read it we’re finding that one in six, and one in seven are finding success. Really a great increase in the odds, but something really troubles me. That’s still too low of odds. The reality is the individuals that I’ve mentored (or there’s been mentoring in some form), the odds for success are one in two to one in three. I like those odds a lot better. 

This has been a real quandary for me. There’s no way that I can individually mentor everyone. I have no training program. I have no big boot camps or anything like that to get one on one with individuals, but I know that the odds of success are so much higher if you actually engaged in the system and have some type of mentoring and interaction going on. To that end I’m doing something that I haven’t done before. I’m endorsing and I’m encouraging you small business owners who are struggling to go engage with Rick Sapio. He runs a website called “Business Finishing School”. It has high-definition, quality videos that go through many of the processes and discuss many of the topics in detail that I have covered and it also provides you a level of engagement and feedback that quite frankly we haven’t been able to provide you in Zig Zag Principle. 

As you know, Rick Sapio is probably quoted more in the book than any other individual. There are two specific things that I really drew on from him. First of all is the values as the basis and second of all the concept of dismissing inappropriate things from your life in the form of a gatekeeper. 
I encourage you to click on and go to Business Finishing School as part of this blog post. As I was discussing with Rick he’s going to give you a money-back guarantee here. He’s also going to give you a signed copy of Zig Zag Principle and invite you to the big event that’s coming up and I encourage you to investigate this, to look at this, and sign up for his program. It will definitely increase your probability of success. 
Good luck, go forward, Zig Zag, and find success.

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Engage With Us – 12 Books Group

Thursday 26 April 2012 @ 11:31 am

 

I am excited to be a part of the 12 Books Group this next month as their featured author during the month of May. Please come join us as we dig deeper into The Zigzag Principle. You won’t want to miss the exclusive giveaways, bonus materials, and excellent discussion with me and other readers.

This really is a unique opportunity because you are going to get a chance to glean knowledge from 8 different business authors from May through December. This will load you with great information to add to your zigzag strategy. 

Go to www.12booksgroup.com to sign up for a free account and keep checking in for reader discussion, video tips from me, and a live Q&A webinar at the end of the month. 

 

I hope you will come join us! 

 

 

 

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Zigzag to Success – Zig Zag Principle #71

Thursday 19 April 2012 @ 10:47 am

 

The Zig Zag Principle is a disciplined approach to business and life.  It is not an “easy” approach; in fact, it requires incredible effort to traverse the mountain before you as you make your way to your destination. But being willing to zigzag—and then doing it with control—will help you build a business and a life that will be stable and strong. As we wrap up this journey we’ve taken together, I want to reiterate the underpinnings of the Zigzag Principle:

You must begin by creating a foundation. 

First, you need to look deep into you pockets and see what resources you have right now.  Second, you must determine what your beacon in the fog is going to be.  Third, you must identify and hold to the values you are going to follow in pursuit that particular goal.  And, finally, you must fuel your efforts with passion and determination. 

Once your foundation is set, you can begin to zig and zag toward your goal.  

The first zig is always to get to profitability.  If you do not meet this goal, then you must try something different and keep trying until you get your business or your life profitable.  The second zag is to use the cash from the previous zig to add resources. This requires that you to let go just a little bit and teach other people how to pursue your dream.  The next zig is to scale your business.  This is the part when you are working on your business, not in your business. 

There will be more zigs and zags as you work toward your final beacon in the fog. 

Just look forward and plan three zigs ahead.  The third zig out can be adjusted and changed to match the terrain of the trail you are following.  All of the zigs and zags need to be bound by guardrails.  These guardrails are the things that will keep you away from the trees, the weeds, and the cliffs.  They are aligned closely with your values.   Each zig and zag is bound by how much money, time, and personal resources you have pre-determined to put toward your goal.  In each case, there is a financial target you need to achieve before you can turn toward the next zig, and this target is always bound by your knowing what you can and can’t afford to lose.

As you hit each zig there will be a planned reward.

The rewards are the motivation that will make you and those around you chose to make that turn toward your next zag.

I set some very ambitious goals for myself when I was a rather ordinary young man living in rural Utah. At the time, I was determined to achieve success in life, and I considered a straight line to be the path to follow in achieving those goals. When I mowed lawns to save for college, I loved to finish a job and look back at those straight lines I had created. If there was a door in my way, I didn’t see any need to open it to get to the other side. If there was a cinderblock wall between me and my goal, I was generally smart enough to recognize my need to go around it, but not without considerable resentment and a consideration of the odds of my crashing straight through. 

Given all of the skiing and mountain climbing I’ve done, coupled with my wife’s insistence that we not chart our course to Disneyland as the crow flies, it’s curious to me that it took me as long as it did to realize that zigzagging really is both a law of nature and (with few exceptions) the most effective way of getting to where we’re headed. But I finally did come to that realization, and by adopting a philosophy that was once antithetical to my very nature, I have achieved considerably more success, even as I have maintained my sanity and my sense of balance and control over those things in my life that matter most. 

While this book has, at times, focused on business settings and practices, the Zigzag Principle can be used in any part of your life. It changes the rules from “one strike and you’re out” or “it’s all or nothing” to principles that help you navigate toward your beacon in the fog. 

You may miss the mark sometimes. That’s fine, as long as you take a minute to get your head above the fog and pinpoint once again where you’re headed. And as long as your zigs and zags are guided by your catalyzing statments. There is nothing more satisfying to me than standing with a son at the bottom of a ski slope and examining the tracks we’ve made in getting down a seemingly impossible slope. Or standing on a jagged mountain summit with my wife and children and retracing our steps to the top. Both are remarkable views – ones that I hope you too will enjoy.  

 

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The Pattern of Success – Zig Zag Principle #70

Thursday 12 April 2012 @ 8:23 pm

In the end, we will avoid the “all or nothing trap” if we adhere to the principles we’ve established for ourselves as we zigzag toward our beacons in the fog.  I once listened to Jeff Sandefer, a university professor and Harvard MBA who BusinessWeek named as one of the top entrepreneurship professors in the United States.  Jeff spoke of a final exam he gave his MBA students, who were required to speak with ten seasoned and successful executives.  Jeff further specified that the first three executives they interviewed needed to be highly successful, but under the age of thirty-five.  The next three successful executives were to be in their mid-forties and fifties.  The final four interviews were to be with successful executives who were in the final stages of their careers.  In each of the interviews, Jeff’s students were to elicit information on how these executives pursued and viewed success.

Invariably, the young bucks were beating their chests and chasing after the brass ring, often in ways that put them at risk of losing their balance.  The middle-aged executives were beginning to figure life out.  Some of them had regrets and others had chosen to add some balance to their lives.

Of course, it was the older executives who gave the real insight.  It did not matter what type of business these men or women were involved with.  In each case, they described a pattern of pursuing success that was guided by these three questions:

1)    Was it honorable?

2)    Did it leave an impact?

3)    Who loves me and who do I love?

Many of these older executives were billionaires.  And yet they talked very little about money.  What mattered to them was how their business helped others and whether their business mattered.  They wanted to leave a legacy. And most importantly, they talked about the people who loved them and the people they loved.  Of course, there were those who did not have loved ones, and they talked about that absence with regret.  They were honest and open and direct about their successes and their mistakes. 

Whatever our goals are, whatever our beacon in the fog is, it is critical that we do what we do for the proper reasons and that we stay within the guardrails and values that we have set for ourselves.  If we do, we will get to the end of our lives—which will inevitably come—and have no regrets.

 

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Avoiding the All-Or-Nothing Trap – Zig Zag Principle #68

Thursday 29 March 2012 @ 12:15 pm

I grew up in a rural community.  My father was completely blind.  I am the oldest of four sons, and as long as I can remember I have had entrepreneurial desires.  Despite some lofty ambitions, I was never any kind of a standout kid.  I was one of those boys who was often overlooked, and I spent a lot of time hoping I wasn’t the last kid picked on the basketball team. Nonetheless, I had this incredible and deep desire to do something of significance with my life.

I remember when I was eighteen years old and just finishing up high school, I wrote down some personal goals. I had always been goal-oriented, and my mother encouraged me to write down my goals. One of those goals was to become the CEO of a major company. Even though I wrote it down, I knew that was as far off a goal as I could have set.  I didn’t think that there was any chance or any possibility in the world of actually ever reaching that goal at that time; in fact, I might as well have written that I was going to sprout wings and flap my way to the moon.  But that became a powerful goal. It was my beacon in the fog.

I was very fortunate to have been able to get a good education.  After graduating, I worked hard and had some incredible opportunities.  And I ended up having the opportunity to work as a CEO and a general manager at some large and well-known companies.  Midway through my career in corporate America, I was given a leadership role in a large, international organization.  I was eager and determined to earn my stripes, and I basically committed to do so at all costs. I was a very young general manager of the U.S. division, and I was determined to do anything that was necessary to succeed. My commitment bordered on insane. I had a young family, but I was traveling hundreds of thousands of miles every year.  There were nights I would stay at the office all night long to do what I felt needed to be done.  I was going to succeed, and I didn’t care about the costs.  Then I learned the lesson that it is not worth risking everything of importance in your life to achieve success. The division I was over became very successful.  In the middle of our run, my mentor and boss, Dr. Peter Horne, called my secretary and said, “I need to have a visit with Rich.”  That meant jumping on a plane, flying to Atlanta, then from Atlanta to Amsterdam, and from Amsterdam across the channel to Birmingham, England.  Door-to-door, this was a twenty-hour trip. When I arrived, Dr. Horne pulled me into his office and sat me down.   He then said, “Rich, we’re really delighted with the progress you’ve made in the business. Things are coming along rather nicely.” And then he made this comment, which has stuck with me: “I want you to remember one thing though, Rich. You can replace almost anything in this world. You can replace a car. You can replace a job. You can replace money. But you can’t replace your health, you can’t replace your trust relationships, and, most importantly, you can’t replace your family.” Then he shooed me out of his office, and I began the long journey home. 

Those twenty hours, which I spent alone on a very crowded airplane, gave me plenty of time to think about what Dr. Horne had just said.  Most of my thoughts centered on my wife and children.  For years I had been telling my wife, “This next project is a big one for me.  I am going to give it my all for six months, so don’t plan on seeing much of me.  But once I finish it, things will be different.”   The six months would pass.  I would complete the project, and then a new project would come along and I would start the cycle all over again.  Those six months had turned into years as I kept promising, “If I give my all to this for six months, then we will have it made.” As we crossed the Alantic, I reflected on a trip I had taken to India some months before.  When I got home, all of my sons and I came down with whooping cough, or pertussis.  We had all been immunized, but somehow we contracted this miserable illness.  It was terrible.  I remember coughing so hard one day that I literally vomited, but I lacked the discipline to take some time off from my work to get better and help my wife with our sons.  My youngest son at the time was Nathan.  He was less than a year old when we all got sick, and it was life-threatening for him.  In fact, he ended up in the hospital, where my wife took care of him because I was too busy.

Flying home, I realized I was falling into the “all or nothing trap,” and I resolved that I was going to do better as a father and husband, and when I got home I made it a point to gather my young sons together, give them each a hug, and tell them I love them.  But when I went to pick up Nathan, he hollered and screamed.  As he pushed me away, I realized he did not even know who I was.  At that moment, I realized that achieving my goal of being a CEO was not worth losing the love of my family.  And I began to change both my priorities and how I actually lived my life.

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Achieve Goals Through Rewards – Zig Zag Principle #67

Thursday 22 March 2012 @ 1:13 pm


When you are planning out rewards, you need to very specifically tie each reward to the zig or the zag you are heading toward.  I always establish timeframes, often in the form of quarterly goals.  When we make our quarterly goals, we sit down
as a team and decide what we want to accomplish.  Once we have established the go
al, we spend almost as much time discussing what reward we will get when we achieve the goal.  Then we make signs and post them all over the office, with the goal written out over a picture of the reward.  

One of the signs I used in our office had a picture of people snowmobiling.  We titled it, “Plowing our Way to Victory.”  Around the picture were listed the goals of getting three new clients and having a financial target of monthly recurring profit.  Another goal was to hire one more engineer and to retain another engineering client. 

For the business my son and his friends work on, they helped me develop a very specific goal if we hit certain targets. They then posted pictures of the cruise ship we would all board if they met their goals, and also the ports we would visit.  Sure enough, each of then achieved their goal, and we went for a one-week cruise. 

As you set long-term goals, don’t overlook the need to reward yourself and your team along the way.  These in-between rewards are ones I like to keep random.  Then, when I see a team member doing a particularly good job at something, I will hand them a pair of movie tickets or a gift card. The other day, we sent one of our contract employees a special “thank you” that he was not expecting.  Ever since then, he has gone over and above on the work that he does for us because that little reward meant so much to him.  Sometimes, random rewards will actually mean more than guaranteeing a treat when you push the same button over and over. 

The work you’re doing is challenging and difficult, and as you hit each zig you take a break from the intensity, celebrate, and enjoy the fruits of your labors.  Then you can do a little jump and turn your skis in the other direction toward the next goal.  We humans do have some things in common with my little salivating dog.  When we align our efforts with little treats along the way, our resulting behaviors will lead to the achieving of our goals.  The rewards make all of the effort worthwhile.

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Rich Christiansen