Read an Excerpt
TurboStrategy
21 Powerful Ways to Transform Your Business and Boost Your Profits Quickly
By Brian Tracy
AMACOM
Copyright © 2003 Brian Tracy
All right reserved.
ISBN: 978-0-8144-2930-3
Chapter One
Start Where You Are Do what you can, with what you have, right where you are.
—THEODORE ROOSEVELT
The starting point of strategic planning is for you to develop absolute clarity about your current situation. Look at your overall business and ask, "What's working?" and "What's not working?" in every area.
What is your current level of sales? Break them down by product, product line, service, market, and distribution channel. What exactly are you selling, to which customers, at what prices, and with what level of profitability?
Compare your current sales with your assumptions, your expectations, and your projections. Are you on track? Compare your level of sales with last year. What are the trends? Are they up or down? Are they temporary or permanent? What do the trends suggest for the future of your business? What could you do to respond more effectively to them?
Cash Flow Is Everything
Look at your cash flow and levels of profitability for each product, service, and area of activity. Are your profits going up or down? Are they on budget or going sideways? Look at the percentages. Analyze your return-on-equity, return-on-investment, and return-on-sales. Are they increasing or decreasing?
Jim Collins says in Good to Great: Why Some Companies Make the Leap—And Others Don't that you must be willing to ask the "brutal questions" about your business if you are going to solve your problems and achieve your goals. If your goal is to build a great company, why isn't your company already great?
Which of your products or services is selling well today? Which of your products and services are the most profitable? Which ones are doing poorly? Which ones do you lose money on?
Is your current business situation, positive or negative, in any area, temporary, or is it part of a long-term trend? How can you know for sure? How can you find out? What should you do next?
Clarity Is the Key
Perhaps the most important word in strategic planning is "clarity." You must be absolutely clear about the answers to each of these questions. Vagueness or fuzziness in any area can lead to problems, difficulties, and even disasters.
Why has your business been successful in the past? What have you done well in the past that has been responsible for your success to date? What are the most important skills and competencies that your company possesses today? What are the very best products and services that you offer right now?
Look at the people around you. Who are your most valuable people? Who is no longer as valuable as before? Who even represents a net loss or detriment to your business? Be prepared to ask and answer the brutal questions.
The Customer Is the King
Who are your best customers today? What and where are your best markets? What do your customers like most about what you do for them? What do they compliment the most of what you offer or do for them? What is your number-one area of customer satisfaction?
What do your customers like least about what you do? What do they complain about most? What is it that you sell that your customers and potential customers prefer to buy somewhere else rather than from you?
Identify Your Personal Strengths
Look at yourself honestly. What are your own personal best skills, qualities, and abilities? What are the most important things you do at work and for your company? What are the most valuable contributions you make personally to your business?
Imagine yourself as a doctor conducting a complete medical examination on your own body. Treat your business as though it were a body as well. Get accurate information on every critical detail of your company, and use this as a baseline to determine your future actions. Be honest and objective at every step.
Harold Geneen, who built ITT into a major conglomerate, always said, "Get the facts. Get the real facts. Not the apparent facts, the hoped-for facts or the obvious facts. Get the real facts, based on analysis. Facts don't lie."
Question Your Assumptions
Time management expert Alex McKenzie once wrote, "Errant assumptions lie at the root of every failure." Everything you do in your business is based on certain assumptions. Some of those assumptions could be wrong. The answers may have changed, and what was correct in the past may not be correct today. Check every assumption and ask, "What if this assumption were not true?"
If you found that you were operating on the basis of a false assumption, what changes would you have to make, especially with regard to your key people, key customers, key products and services, and key projections?
Strategic planning requires that you begin with a realistic and honest assessment of exactly where you are and what you are today. This becomes your starting point for strategic planning and strategic thinking. It becomes the foundation upon which all future decisions are made.
Start Where You Are
1. What is working best in your business today? What parts of your business make you happiest?
2. What is not working in your business? What causes you the most aggravation and frustration?
3. What are your most important products and markets? What accounts for the largest portion of your revenues?
4. Who are your most important people? Who are the people who account for most of your results?
5. What are your special talents and skills? What is it you do that accounts for most of your success?
6. What are the major changes taking place in your market? What changes should you make to compensate for them?
7. What are your most treasured assumptions about your people, customers, markets, products, services, and yourself? What if one of them weren't true? What would you do then?
Chapter Two
Draw a Line Under the Past Deep within man dwell those slumbering powers; powers that would astonish him, that he never dreamed of possessing; forces that would revolutionize his life if aroused and put into action.
—ORISON SWETT MARDEN
Often, when a company gets into trouble, the board or company owners bring in a turnaround specialist and put that person in charge. The reason they do this is because the turnaround specialist has no vested interest in anything that has happened up to that moment. The turnaround specialist simply draws a line under the past and focuses totally on the future and the survival of the business. You need to do the same. You need to be your own turnaround specialist.
To build a great tomorrow, you have to discontinue the things that aren't working. In order to do more things right, you have to stop doing things wrong.
Practice Zero-Based Thinking
For you to maintain maximum flexibility, there is a thinking tool you can use today and for the rest of your career. It is one of the best analytic tools I have ever discovered in a lifetime of reading, research, and practice. I call it "zero-based thinking."
Let me give you a quick illustration of zero-based thinking.
I live not far from a San Diego community called Rancho Santa Fe. This area has been written up in Forbes magazine as the most expensive neighborhood in the United States. The average home price in this area is more than a million dollars, and the prices rise quickly up to $25 and $30 million each. The neighborhood was originally established more than fifty years ago by the Santa Fe Railway Company and is considered to be the most deluxe and elite neighborhood in the greater San Diego area.
Within the covenant area of Rancho Santa Fe, there are very strict guidelines concerning lot size and architectural design. Each home must conform to specific rules of color and structure, and each home site must be a minimum of two acres. Since the area has been developed, and since homes have been built there for more than fifty years, there are a lot of old homes, which are often referred to by real estate agents as "scrapers."
A scraper is an older, smaller home on a lot in Rancho Santa Fe that is two acres or more in size. People who want the prestige of living in "The Ranch" have found that it is usually cheaper to simply bring in a bulldozer and scrape off the old house rather than attempting to fix it up or renovate it. It turns out to be cheaper to build a brand new house on the prime property than it is to try to make an old house livable.
Imagine Starting Over
Zero-based thinking requires that you apply this "scraper" mentality to every part of your business. You do this by asking this key question: Is there anything I am doing in my business that, knowing what I know now, I wouldn't start up again today if I had it to do over?
Instead of struggling to determine how you might modify, change, fix, revise, improve, or alter some business function, you instead ask, "If I were not doing this today, would I start it up again, knowing what I know now?"
To begin with, is there any product or service that you would not bring to the market, offer, or sell if you had it to do over again, starting today? Since 80 percent of your products and services are probably going to be obsolete within the next five years, there may be products and services you are offering today that, because of changed market conditions, you would not introduce if you had it to do over again, knowing what you know now. These products or services are prime candidates for discontinuation or divestiture.
Is there any person in your business that you would not hire, assign, appoint, go to work for, or become associated with if you had it to do over again? Most of your problems in business will come from attempting to work with or around a difficult person, who, knowing what you know now, you wouldn't get involved with again. Who does this bring to mind?
Is there any supplier, banker, or vendor you are dealing with today who, knowing what you know now, you wouldn't get involved with if you had it to do over? Since many of your business relationships will not work out over time, you must be prepared to reevaluate them constantly, especially if they are causing you any problems or frustrations.
Analyze Your Customers
Is there any customer you are selling to or servicing today who, knowing what you know now, you wouldn't take on again? Many companies are asking this question about their difficult customers and deciding to let them go. Sometimes one of the smartest things you can do is to "fire your customers." Encourage them to go and deal with someone else who would be more appropriate for them.
Assess Your Business Operations
Is there any expenditure in your business that you would not authorize again if you had it to do over? Is there any process, procedure, or activity that you wouldn't start up again, or get into, if you were making the decision today, knowing what you know now?
Is there any advertising, marketing or selling methodology, or expense that, knowing what you know now, you wouldn't start up again today? Keep asking, "What's working?" and "What's not working?"
Pay Attention to the Indicators
You can always tell when you are in a zero-based thinking situation because it causes you continuous stress, aggravation, frustration, negativity, and unhappiness. You think about it continuously. Often you bring it home at night and discuss it at the family dinner table. Sometimes it will even keep you awake at night.
Whenever something is not working, or not working out the way you expected, or causing you stress, financial losses, aggravation, or irritation, ask, "Knowing what I know now, would I get into this again today if I had it to do over?"
If the answer is "No!" then your next question is "How do I get out and how fast?"
The Decision Is Inevitable
Here's an important point. If something is not working, eventually you will have to get out of it. You will have to let the person go, discontinue the product or service, eliminate the activity or expense, or change the method of operation. It is only a matter of time. It is not going to get better all by itself. And every single executive who finally decides to get out of an unhappy situation says afterwards, "I should have done this a long time ago!"
Apply This Approach Continuously
Practice zero-based thinking as a "go forward" method for the rest of your business career. Apply it to everything you do, to every part of your business, every single day. Apply it to every product, service, process, procedure, and person, and be sure that, knowing what you know now, you would get into it again today if you had it to do over. If not, get out as fast as you can.
Draw a Line Under the Past
1. Imagine starting over again in every part of your business. Is there anything you are doing that, knowing what you know now, you wouldn't start up again today?
2. Is there any person in your business life who, knowing what you know now, you wouldn't hire, assign, promote, or otherwise get involved with again today?
3. Is there any product or service that, knowing what you know now, you wouldn't bring to the market again today?
4. Is there any investment you have made that, knowing what you know now, you wouldn't make again today?
5. Is there any business activity or process you are using that, knowing what you know now, you wouldn't start up again today?
6. Is there any customer or market that, knowing what you know now, you wouldn't take on or get into again today, if you had it to do over?
7. Is there any career decision you have made that, knowing what you know now, you wouldn't make the same way if you had it to do over?
Chapter Three
Conduct a Basic Business Analysis Asking the right questions takes as much skill as giving the right answers.
—ROBERT HALF
Whenever you go in for a complete medical exam, the doctors and nurses follow a set procedure. They begin by checking your vital functions to determine your overall level of health. They check your pulse rate, your temperature, your blood pressure, and your respiratory rate. They then take samples and test your blood, urine, and feces. In a more extensive medical exam, they check your heart, your lungs, your colon, and a variety of other areas to get a clear picture of the health of your body. By the time they have completed their examination, they have an accurate picture of your overall health and physical well-being.
In the same way, there are basic business examination questions that you need to ask and answer continuously throughout the life of your organization. The greater the rate of turbulence in the world around you, the more important it is that you ask and answer these questions accurately.
Start with the Basics
The starting point of business analysis is for you to ask: "What business am I in?" What business am I really in? What business am I really, really in?"
Many companies become so caught up in their day-to-day operations that they lose sight of their real reasons for existence. They lose sight of the fact that they are in business to perform a particular service, or to achieve a particular goal, for a specific type of customer.
For example, many years ago the railroads concluded that they were in the railroad business. In reality, they were in the transportation business. By losing sight of the business they were really in, the railroads completely missed the shipping industry, the trucking industry, and the airline industry. It wasn't long before their markets were taken away from them by these industries, and many of them went bankrupt.
When I first began speaking, I defined myself as being in the "training" business. I soon realized I was in the "goal achievement business." My business was helping people to achieve their personal and business goals faster by providing them with practical ideas that they could use immediately to get better results.
This insight led me from talks and seminars into audio and video recording, books, training programs, and Internet-based e-learning on a variety of subjects, including the development and presentation of the Turbostrategy Process.
The Customer as Centerpiece
The next question you must ask and answer accurately is "Who is my customer?" Who is the person who buys from you today? Describe your customer in detail. What is the age, income, education, position, attitude, location, and interest of your ideal customer? Many companies are not exactly sure of the answer to this question. They have at best an unclear picture of the psychological and demographic characteristics of their customers.
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Excerpted from TurboStrategy by Brian Tracy Copyright © 2003 by Brian Tracy. Excerpted by permission of AMACOM. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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