I dedicate this article in memoriam of Daniel Kahneman, a champion of rationality, who recently passed away at the age of 92.
This piece reflects on his profound influence on our understanding of rationality. Kahneman’s work inspired a critical examination of the economic models that too often claim constancy, only to unravel under real-world conditions. He prompted us to reconsider our assumptions and the very notion of rationality.
Rationality and the Real World
Kahneman, his colleagues, and followers led the movement towards questioning rationality. Many of us have listened to economic arguments that start with “ceturus paribus “(all things being equal) and then proceed with all kinds of formulas that ignore that warning.
Kahneman stimulated us to challenge assumptions and what is perceived as rational thought. In particular, changing data, bias, wrong data, and wrong interpretations can greatly alter analysis. One of the best examples is the pandemic where we didn’t – and still don’t – fully understand or consider the disruptions and their impact. It’s been a stark reminder of how unpredictable variables can render our data and logic incomplete.
The Dynamics of Decision-Making
I argue considering issues like bias, probability, time, and value can greatly enhance the rationality of decisions. We often assume that the information behind probability is correct. Stock advisors’ have been wrong far too often particularly as it relates to stocks that continue to increase. Our sports teams’ probabilities are probably the most common example of overestimating the rationality of outcomes. Our perceptions can significantly affect the probabilities we use. We should consider how biases color our forecasts, often painting an unrealistically rosy picture. It’s a reminder that our self-perception can diverge significantly from how others, such as our supervisors, may assess us.
Time is also a crucial factor in our decisions. A small entrepreneur is frequently worried about short-term returns in order to make a living. Venture capitalists expect short-term losses in order to grow businesses and make huge long-term gains. Similarly, the actual value of a lottery jackpot can significantly diminish when the payout time arrives. Acknowledging the importance of timing can guide more rational decisions.
The Pursuit of Better Data
We need more focus on the nature, quantity, and quality of data. The more data, the more reliability – and the less data, the more variability. We need to assure that the variables we consider to predict success are, in fact, reliable. As we navigate through an ever-changing landscape of social, economic, and political shifts, the need for accurate and comprehensive data becomes increasingly apparent.
Confidence in the Face of Uncertainty
Confidence, too, plays a vital role in shaping our strategies. Risk is underestimated by worrying about losses more than gains, ignoring outliers, and not following intuition; the success that can follow initial setbacks.
Confidence is greatly affected by understanding the parameters of decisions. Playing cards with your friends is a zero-sum game because the total winnings equal the total losses except for expenses. Investing in the stock market is over the long-term a win-win because history shows it has increased 5-15% annually. Gambling in total is a lose-lose because the house wins a particular percentage on bets. Yet we continue to lose money on an enormous amount of gambling debts.
Failure is often a requirement for success. As Thomas Edison said, “I have not failed. I’ve just found 10,000 ways that won’t work.”
Yet we sometimes fail to recognize its value in the process of achieving success. For example, fear and uncertainty accelerate the concerns about failure. Many studies have shown that we are about twice as likely to avoid losses as pursue gains. For example, we will trade stocks with gains twice as fast as selling stocks with losses despite tax advantages for selling losses. Sports teams consistently take fewer three-point shots, steal fewer bases, and attempt fewer two-point conversions than the odds would dictate.
A key process to mitigate failure is to analyze, test, measure, evaluate and examine alternatives. Why are kids not afraid of failure yet we become more afraid as we age? Just watch kids try things after they fail. I am always impressed with kids who won’t stop riding after they learn to ride a bicycle. It’s this fearlessness in the face of failure provides a valuable lesson in resilience for all of us.
Rationality also includes compromises. We tend to prefer to avoid loses rather than pursue gains. For example, most people will choose to flip a coin to avoid losses rather than do nothing for an equal choice.
Bias and Decision-Making
Bias is a critical issue in disrupting decisions and rationality. In fact, bias is one of the greatest complications when it comes to accuracy in the scientific analysis of decisions. This includes statistical problems like sampling, measurement, and development of information. For example, demographic considerations like aging, ethnic background and geography are not fully considered.
I also believe that social bias can be more impactful than statistical bias. This includes our preconceived perceptions and assumptions. I’m always amazed that many programmed employee selection tools outperform interviews especially in jobs requiring specific skills. Such tests remove things like unconscious age, sex, and racial discrimination.
Cultural Influences on Rationality
Cultural and environmental influences on bias suggest that our backgrounds can both hinder and facilitate understanding. Shared origins can often lead to more harmonious interactions. For example, dress, demographics, weather, location, and culture all affect perceptions in the decision-making process. These can also be used to your advantage. For instance, whenever I meet someone who is also from the Southside of Chicago, agreement on differences becomes much easier.
Climate Change: A Rational Approach Needed
Climate change represents a glaring example of collective inaction in the face of overwhelming scientific consensus, emphasizing the urgent need to shift toward sustainable practices. For the 10th consecutive month, Earth in March set a new monthly record for global heat — with both air temperatures and the world’s oceans hitting an all-time high for the month, according to European Union climate agency.
Climate scientists attribute most of the record heat to human-caused climate change from carbon dioxide and methane emissions produced by gas. “The trajectory will not change until concentrations of greenhouse gases in the atmosphere stop rising, which means we must stop burning fossil fuels, stop deforestation, and grow our food more sustainably as quickly as possible. Until then, we expect to break more records.
In summary, the world is far from a place where all factors are equal or decisions purely rational. By deepening our understanding of biases, recognizing the significance of time, scrutinizing probabilities, and demanding better data, we can refine our decision-making process. There is a pressing need to embrace a more nuanced and informed approach to rationality.
Contact us for a FREE evaluation and get an alternative perspective on your business. We’d love to help you identify ways to adapt to current trends. No one has time for BS—so we’ll cut straight to the point and answer any questions you have. Reach us at:
Dr. Bert Shlensky, President of StartupConnection.net, has an MBA and PhD from the Sloan School of Management at M.I.T. He served as the President of WestPoint Pepperell’s apparel fabrics business & President and CEO of Sure Fit Products. More than 2,000 clients have benefitted from his business acumen over the course of his long career. He now focuses on working with select startups and small businesses. Please visit our website: https://www.startupconnection.net/ for more information.
When we discuss misinformation, lying is the most common focus. However, there are numerous other types of misinformation. In particular wrong information, missing information, and unavailable information are key challenges that need to be addressed and possible resolutions provided.
We underestimate the importance of simply wrong information in our decision-making. Sources can change, measurements can be incorrect, and suddenly we’re faced with a bunch of errors that inhibit making accurate conclusions and better decisions.
Economic Forecasting, COVID-19 Impact and Embracing Humility
Many economists and forecasters were mostly wrong in forecasting a recession in 2023. While they understood inflation, they ignored the growth in employment, the economy, and consumer spending. Similarly, we are still adapting to the impact of COVID-19 on current analysis. The shifts from 2020 in almost everything from vaccine practices and death rates to how we consume entertainment to remote work must be considered as we’re considering decisions.
Changes in retail, wars, labor battles, politics, etc. are all causing disruptions in our understanding. And because we lack information and experience on issues like electric cars, A.I. and immigration, we’re in the dark and that makes it far more difficult to be able to make the best decisions.
Critical thinking isn’t just about spotting logical fallacies or identifying bias. It’s about fostering an attitude of intellectual humility, a willingness to admit we don’t know everything and to change our minds when presented with new evidence. It’s about creating a habit of asking, “Is this true? What’s the source? Are there alternate viewpoints?”.
Psychological Constraints in Risk Assessment
Certainty and risk both play a big role in misinformation. We need to understand the probability and value of decisions. We need to understand all the information that is available to us – background, probabilities, and parameters – which can greatly impact outcomes.
Figuring out risks, however, can sometimes be tricky, due to several psychological constraints:
People tend to take more risks to win back losses and less risks to follow up on winnings.
Marketers love to push our pain points and focus on our fears.
We overestimate our skills and luck, as shown in the betting industries, where huge profits are made based on countless people believing that they can beat the odds.
Navigating Bias from Statistical to Social Influences
Bias is one of the greatest complications when it comes to making accurate decisions. Professionals usually focus on statistical problems, but things like demographics, measurement, and timing matter as much, if not more. Remember, your data is only as good as your worst input.
But I think social bias – our preconceived ideas about things – is more misleading than statistical bias. Culture and the environment also factor into bias, affecting how we see things. For instance, in presentations, I’ve learned that having food available to the attendees is a hit. I’ve also learned to never be the last speaker. Past experiences and what we want to see can also cloud our judgment more than future expectations.
Misinformation in Setting Parameters, Taboo Topics and Cause-Effect Confusions
Misinformation also messes with understanding our decision parameters. We tend to see decisions as win-lose but flipping that to a “win-win” mindset can be a game-changer. We often miss out on opportunities because we underestimate the chances of everyone coming out on top.
Misinformation is prevalent in topics we tend to avoid discussing – things like religion, sex and I.Q. Santa Claus is one of the only exceptions where it seems proper to include misinformation.
Cause and effect are frequently misused in reaching decisions as well. Figuring out what really causes what, citing wrong connections, and mixing up relationships with causes – those are all common errors.
Trusting Intuition and Debunking “Bubbbe Meise”
Sometimes you must ignore some of the information and just listen to your gut. In Yiddish, there is the word “bubbbe meise” which basically translates to “old wise tales”. This would include things like chicken soup being a cold cure, or the 5 second rule where it’s safe to eat something that’s fallen on the ground if it hasn’t been there for more than 5 seconds, knocking on wood for luck, and numerous unproven folklore we follow.
My favorite is the 60-40 investment rule which has been wrong for over 10 years. We tend to overthink things or we let fear stop us from taking risks, but there is no gain without trying and no reward without risk. If your intuition is telling you something, it’s usually worth listening.
Measurement Challenges: From Gym Scales to Performance Metrics
Measurement is a clear issue in misinformation. For instance, my scale at the gym had me excited because it showed I’d lost 10 pounds over a few months. However, when I went to the doctor, that scale showed only 4 pounds lost.
So how do we improve goal setting and measurement? The first step is to think about it and consider more details and considerations. Long-term versus short-term, quantitative versus qualitative, risk and caution, objective versus subjective all need to be considered in setting goals. We also need to consider the process and complexity of measurement. For example, do you want specific, general or directional results?
Measurement has become similarly complex. How important are results, speed, motivation, innovation, and quality in measuring performance?
For example, I believe automation has improved the speed and efficiency of many customer service processes. However, customer service and satisfaction are frequently sacrificed for that automation. How many times have we been completely frustrated with ineffective electronic customer service efforts?
Promoting Social Responsibility in Fact-Checking
How do we nurture the social responsibility of fact-checking? First, let’s normalize it. Make fact-checking a routine part of how we interact with information. From the news articles we read to the social media posts we share; each piece of information should go through a fact-checking filter.
Similarly, the bandwagon effect can propel us to jump on board with popular yet baseless narratives. Understanding these psychological tendencies is key to unravelling why misinformation can sometimes be so tricky.
Let’s remember that misinformation isn’t just a problem of the information era; it’s a human problem, rooted in our cognition and emotions. By acknowledging this, we can begin to address misinformation in a more holistic way, weaving psychological insights into our strategies to counter false narratives.
Let’s strive to understand not just the ‘what’ of misinformation, but also the ‘why’. After all, knowing our adversary is half the battle won. And in this fight against misinformation, a solid understanding of the human psyche is a weapon we cannot afford to neglect.
Dr. Bert Shlensky earned a PhD from the Sloan School of Management at M.I.T., mentored a few thousand clients at Score and in his own practice, grew Sure Fit products from $50 million to $150 million in sales, including $60 million of direct internet sales, was President of WestPoint Pepperell’s Apparel Fabrics Business and headed the $400 million Culet Shirt Group. Dr. Bert knows what works and can help lead your company to greater profitability and success. For a free initial consult, reach out at bshlenksy@startupconnection.net or 914-632-6977.
One of the key responsibilities of an entrepreneur is the ability to make great decisions. If you choose the right approach, you’ll likely make faster and more effective decisions. But if you choose the wrong decision-making approaches, you could be courting disaster.
One of the most common decision-making approaches to making business decisions is by using data-driven analytics rather than intuition. However, I believe you’ll make better decisions by balancing these styles rather than by choosing one over the other. Take a look at the video Passion and Reality to get an idea of what I mean.
There are times when using analytics is the right call and times when it isn’t. Using data to make decisions is critically important because it reduces the tendency to make poor decisions; however, there are times when you need to trust your gut instincts.
So how exactly do you balance analytics and intuition? If you have the necessary data at your fingertips, then you should analyze that data to identify patterns, obtain actionable insights, and use those insights to make your business decisions. However, you shouldn’t avoid making decisions just because you don’t have all the pertinent data. Rather, this is when you also need to rely on your intuition to get the job done.
The fact is that many of our great innovators were highly intuitive people. In the words of Apple co-founder Steve Jobs, “The people who are crazy enough to think they can change the world are the ones who do.”
A Flexible Business Plan Is Key
It’s important to develop a business plan that specifies your goals and explains how you plan to achieve those goals. This plan should include sections on your products and/or services, marketing strategy and analysis, and budget.
The fact is that the business world is in a constant state of flux and if you can’t change with it, you’ll be left behind. That’s why it’s critical to ensure that you create a business plan that’s flexible—one that will adapt to market changes and advancements in technologies as this will give your organization a competitive edge.
A flexible business plan lets you keep track of your progress and adjust, when necessary, by showing you where you’re going and how you anticipate getting there. And it also helps you remain focused on what’s important, enabling you to achieve your long-term goals.
In addition, if you need to secure funds from lenders, investors, or other sources, a flexible business plan will help you get the capital you need because these sources want to see that you’re able to adapt and pivot as the market changes. If you have a flexible business plan, you can show them that you’re able to handle whatever the future holds.
The Importance of Understanding Risk
Your life as an entrepreneur involves taking risks that can impact you and your business. So, before you decide to launch a new venture, it’s important that you understand the risks as well as the rewards associated with owning a business.
Every business operates in extremely uncertain environments that can produce significant levels of risk but also generate substantial rewards. Taking risks means identifying, evaluating, mitigating, and experimenting with potential strategies and opportunities that could help you build your company.
It’s also important to understand that while you are focusing on profits and cash flow to ensure your company’s viability, venture capital firms, on the other hand, only expect a fraction of their investments to show good returns, and they frequently focus on growth rather than profits.
In general, entrepreneurs can afford more risk. Consequently, it’s important that you consider that the upsides of many risks are much greater than their limited downsides. Additionally, you need to understand the outcomes and accept failure as part of the process.
Overcoming Decision-Making Bias
For your startup business to succeed, you must make fair and accurate decisions in terms of how you treat your workers and how you serve your customers.
The best entrepreneurs are those who can absorb and analyze all the information available to them to make business decisions that are logical and objective. Of course, you’re going to make some mistakes. But most of the mistakes you’ll make stem from inherent biases that distract you and cause you to make poor decisions and exhibit bad judgment.
Not only that but letting personal preferences affect the objective decision-making process, even unconsciously, can severely undermine your authority and image in your own company.
While experience and expertise can improve results, one of the worst strategies in our changing environment is to stick fast to the “we have always done it this way” mindset.
This mindset simply ignores change, alternatives, and processes and is frequently fueled by those who fear those same things. Sexual harassment, equal wages, and COVID vaccines are some examples where progress has been exceptionally slow because people are not willing to recognize the need for change and accept and implement new ideas.
However, quantitative analysis does not automatically solve bias. On one hand, quantitative measures are objective, measurable, comparable, and easier to document. Still, we must ensure we are using the right measures as well as measure and analyze correctly.
Qualitative data, on the other hand, can measure issues we don’t always consider and allow for intuition. But these processes can be compromised easily or measure wrong factors. In particular, bias occurs much more frequently in qualitative analysis.
Qualitative data can measure issues we don’t always consider and allow for intuition. But they can be easily compromised and measure the wrong factors. In particular, bias occurs much more frequently in qualitative analysis.
Consider Changes in Parameters
You should also give more weight to external parameters than basic plans and strategies when you’re developing programs and making decisions. It’s important that you regularly review and consider changes in parameters, such as population, the economy, political environment, and social values, as many of these variables are changing faster and more often than ever before. So not only do you need to understand parameters, you definitely need to keep up with the latest ones.
You should also consider your target market. Many businesses think everyone needs their products when, in reality, most people don’t need any product. So, if you want to figure out who will buy you goods or services, make decisions based off supported data and hone in on your demographic.
Replace Hierarchy
Most organizations are based on hierarchy but flatter and more collaborative organizations are actually more effective as they encourage more diverse input by enabling employees at all levels to participate and contribute to the objectives of the business. A flatter organization prioritizes collaboration, clear communication, and the free exchange of ideas.
Through collaboration and analysis, businesses can develop more efficient structures that rely on expertise via a variety of resources. And adding new positions and creating functional groups (where individuals or departments are in charge of their own specialties) will encourage more educated decisions and reactive change.
The Bottom Line
Being an entrepreneur should be an exciting and potentially profitable effort. However, it takes time, analysis, capital, and commitment. As an entrepreneur, you need to understand and express your passion. And to succeed, you must use this passion to overcome any obstacles or challenges that might come your way.
However, that doesn’t mean you should ignore reality. Many entrepreneurs overlook key elements in running a successful business, often ignoring details and analysis. It’s no wonder so many startups fail.
If you want to be successful, you must allow your passion to drive you, while letting reality guide you to where you need to be. Using some basic tools, such as planning and operations, the process can become more predictable. And understanding such things as the environment, bias, structure, and demographics, can help you make the best possible decisions for your business.
Dr. Bert Shlensky, President of www.startupconnection.net, offers experience, skills, and a team devoted to developing and executing winning strategies. Our strategy includes clear steps, and over 150 free articles and templates to facilitate your efforts and guide your process. We’re here to help you get on track and stay there as you move forward. You might start with our quick video here.
We welcome comments, suggestions, and questions. You can write us at: bshlensky@startupconnection.net or call at 914-632-6977
In many discussions of decision-making for a business, multiple contradictory approaches are frequently presented. The most common approach to improve profits is using analytics versus intuition. We prefer the use of complimentary rather than contradictory approaches to improve profitability at an organization. Here are several examples of multiple approaches that also illustrate some key decision-making tools. The analytics versus intuition comparison is well shown in this video of ours on Passion and Reality.
As an entrepreneur, do you know how do you balance analytics and intuition? If facts and certainty are readily available at your fingertips, then using the theory of analysis is preferred. However, decisions should not be avoided because information at the time you need to make the decision is not certain. In these cases, using and relying on your intuition is essential and albeit fundamental. Steve Jobs says this is true, because the people who are crazy enough to think they can change the world, are often the ones who do make those changes and on a grand scale.
Plans and budgets that explain goals, programs, and components are essential but need to be flexible, client navigable and interactive, and part of a definite business process. Many traditional plans are beautiful, skilled and professional presentations that sit on shelves for years as soon as one key variable change in that plan. We offer that in contrast, you can develop flexible programs that are designed to include alternatives, interaction among factors, and discussions of parameters and assumptions. These are designed to be reviewed, compared and encouraged to be used for pivoting as the company, the parameters, the environment, challenges and any current opportunities for change. For example, the nature and impact of A.I. are uncertain for many businesses that do not use that technology yet today. However, as a business owner you can still plan for different benefits and the impacts of A.I for the future of your business as you expand.
We frequently view risk and probability without understanding the situation or environment. Venture capital firms only expect a fraction of their investments to show good returns. Despite this, they expect high returns as the end goal anyway, and frequently focus on growth rather than profits. Conversely, small business entrepreneurs frequently focus on profits and cash flow in order to ensure their viability.
As a new business owner or startup, you might be in a position to afford more risk, in order to get more profits now. Overall, it is human nature that people are more averse to risk than they are analytical. In that way, we always need to evaluate results and consider alternatives. We need to consider that the upside of many risks is much greater than limited downside. We need to understand outcomes and accept failure as part of the process. But there is a bit more than this going on, and you can sit back and let us help you do the heavy lifting on this one, once you contact us for your consultation.
Cultural and organizational bias is inevitable, but can be understood and worked on to take it out of the equation for good. Our enthusiasm, information, focus or mindset frequently cause us to overestimate markets, ignore competition and not consider the issues affecting decisions for the clients and customers. Here we can argue that one of the key causes of bias and inhibitors of success are naysayers and enablers at an organization. While experience and expertise can improve results, one of the worst limiting beliefs in our changing environment is when workers say, “We have always done it this way,” meaning that they do not embrace new and necessary changes at the organization. You cannot get to the top of Mount Everest with your hands in your pocket, and this type of small thinking simply ignores change, alternatives and better processes that exist to allow profits for your business. This type of thinking is also frequently fueled by proponents who fear change, alternatives on the job and who hate any level of discomfort, and we all know this is not going to work for long at your company.
Quantitative analysis does not automatically solve bias in or at a business operation. Quantitative measures are simpler to document, measure, make an objective analysis and determine how it is comparable to what you are already doing at your organization. However, we must ensure we here to help you navigate how to best use quantitative data, which can assist your business to measure issues we do not always consider, and allow you the opportunity to take your business to the next level by trusting your intuition. How can this be done? We are here to walk you through the steps to determining the reality of your business and find real-time solutions to the issues plaguing your business right now.
It is generally accepted that the 80-20 rule, which is based on a centuries old mathematical law, is one of the best guidelines for setting priorities and making solid business decisions. Specifically, this rule works because it argues that 80% of your sales and results, will come from 20% of your efforts. This is currently being confirmed in the stock market, where 7 popular stocks represent the majority of current gains as noted in 2023. While the rule should probably be followed more than it is, and we’d like to point out that there are exceptions. We are here to help you find out how these tried and true rules can help you improve your bottom line, and we can answer any questions that you have on how to become more profitable right now.
Fine tuning parameters and the environment need more consideration than basic plans and strategies. This theory means that your identification of issues today will go a long way in developing programs and making decisions that will propel your business forward tomorrow. The most obvious example, is that it is easier to compete in large, growing profitable markets, than to work exclusively in small marginal contracting markets. Office real estate investment venues right now, are currently far less attractive than vacation rentals. Why this is so, is because the realities and changes in parameters for real estate, like populations, the economy, political environment, and social values, should all be reviewed and considered regularly to understand critical changes. The most important idea to keep in mind is that many variables are changing faster and more often than ever before. For this reason, not only do you need to understand parameters, you need to keep up with the latest ones, and know when to take a hard right turn on a new trend that you’ve seen already working for other companies in your business industry.
Replace your current hierarchy. Most organizations are based on a power or management hierarchy, but we know now that a flatter and more collaborative organizational culture have proven to be more effective in getting buy-in from the staff and workers. A more open management style can encourage more diverse worker input, reward competence among peers, encourage innovations in technology, and are generally found to be more flexible to react to change when needed [hint: it is nearly always needed].
Through collaboration and analysis, businesses can develop more efficient structures that rely on expertise via the use of a variety of resources. Even successful tragedy solutions all praise the importance of cooperative efforts among agencies. For this reason, adding new positions and creating functional groups (where individuals or departments are accountable for the results of customer success in their own specialty) will encourage more educated decisions and reactive change to keep you as an industry leader, when other competitors are stuck in first gear. Let us help you review new ideas on how to apply leadership and management at your organization. It will not hurt, we promise, but you will feel differently afterwards about the hierarchy that you currently have but have never updated until now.
Operations and logistics are frequently viewed as secondary functions that can be handled by someone else, but that is not the best course of action for a small business. However in reality, your operations and logistics can present a huge opportunity for a business to become more efficient and to differentiate itself from the local competition. We can help you understand what you need to do to be better at the business process you have in place, to get out your product or services to the community. Don’t worry, we can make that review process as painless as possible, and all that you need to do to get this going is to contact us today.
Customer and Client Demographics all depend on a wide range of variables, which can affect how you engage these individuals: including age, location, income, etc. We know that it can be confusing and complicated to finding the right target audience for your brand or product. Marketing can be complicated, but we are here to help you sort it out ship shape and Bristol fashion! For example, the Hispanic market represents 16% of the population in 2022, as compared to 13% in 2010. However, the penetration that a business will find using these statistics is quite varied. The Hispanic demographic for instance represents over 59% of the under 18 population in Texas, and only 3% of the over 65 population in Maine. Why is this designation important? Because many businesses think everyone needs their product when, in reality, most people don’t need any product at all. You have to be able to resolve a need that a client has before you can offer that solution to them, it doesn’t work the other way around. Making the most of demographic information is what we do best, and we can help you to understand who you need to be marketing your products or services to best. All that it takes is making that first contact with us, this will help to start the ball rolling on getting more profits in hand for your business.
What you will get out of this blog is that if we spend more time reviewing the processes of change versus excellence, you will have a clearer guideline of what you can improve today. Clearly companies like Kodak and Blockbuster are examples of sticking with a formula too long, whereby they didn’t change their process of customer servicing in time to be pushed out of the market by a competitor who just did what they offered the customers better! In contrast, it can happen that companies frequently change executives, sell, and make investments with little or no outcome. The debate of pursuing improved excellence versus change is affected by a number of issues, and we are here to help you understand these theories. We can show you how to understand which problems that you have are affected by your bottom line or goals, versus reviewing the business tactics that you are currently using to help you to acquire different and more positive solutions. These priorities will include: reviewing business details, priorities, and communication both internal and external to your company.
We understand that being an entrepreneur and managing your own business is what juices you up right now, but after you get started on the basics, you need to keep several key factors in mind. As an entrepreneur, you need to allow your passion to drive you and at the same time understand the gaps in knowledge you need to fill in order to be successful at your current business. We can help you organize your business to optimize basic tools such as: planning and operations, the competitive environment, cultural biases, business structure and demographics and other key components of your business. This will keep you on track and allow you to better facilitate solutions and reduce challenges, to stay vigilant and in touch with reality for your business operations. Your business process may be basically on point, but we can help you to tune up the organizational protocols, in order to help you better manage and understand factors that can affect your bottom line, such as the current overall business environment, cultural biases, overall business competition, your business structures and the demographics of your client base. Contact us today, and we can work with you to jump start and facilitate better solutions for your business. This will leave you free to concentrate on your clients and customers, to resolve their issues showcasing all your business acumen and expertise.
Dr. Bert Shlensky, President of www.startupconnection.net, offers experience, skills, and a team devoted to developing and executing winning strategies for your new or established business. Our strategies help you increase your bottom line, and includes clear steps, with access to over 150 free articles and templates, to help facilitate your efforts and guide your process to profitability today. We are here to help you get on track and stay there as you move forward with your business. It’s easy to get started, email us below and also check out our quick video.
Email us today and tell us what you need to be more successful in your new or established business at: bshlensky@startupconnection.net or call at 914-632-6977 (land line no texts).
“Who’s in charge here?” A question frequently asked when things go wrong. We want answers when bad decisions lead us to less than ideal outcomes! We demand to know where blame should be placed for any negative situation we find ourselves in! And we tend to assume that all decisions are made at the top level—and, too often, they are. And that’s the problem. Because the best decisions usually include operational features. Learn to make better decisions.
It’s a common misconception that the smartest, most capable members of an organization are at the top, “running the show.” But, that’s naïve thinking because a majority of us have been that employee dealing with an incompetent boss, right? Successful businesses (and governments) have learned that infrastructure, support, and teamwork are integral to effective decision-making. This is why leaders have advisors and the reason many companies utilize think tanks to make better decisions. Sure, there’s often a need for a strong “all-star” to be the face of a business or team, but organizations are finally acknowledging that operations are the glue holding everything together and communication between all levels is imperative.
With that in mind, it’s easy to see why the current trend shows that operations
and analytics are critical components of marketing and planning. Additionally,
automation, technology, customer needs, and the sharing economy are becoming
vital components of the branding and marketing process. Some examples include:
Internet
sales. In the beginning, delivery and security were thought to be major obstacles.
Today, quality customer service, heightened cybersecurity, and speedy delivery have
become virtually standard. Additionally, the elimination of several processing stages
(like those used in brick and mortar stores) can dramatically reduce costs and
prices.
Innovative
marketing strategies. Creativity, differentiation, and advertising have always been the focus
of traditional marketing and branding approaches. However, factors like value,
service, quality, and culture are producing better results. The evidence is
clear if you compare how brands in department stores target their customers
versus the way Amazon and other leading online stores interact with users.
So how do you utilize operations to make better decisions?
“All-inclusive” business structures. Companies are learning to value expertise and experience over the obsolete hierarchy system. Phrases like, “We have always done it this way,” and, “Because I’m the boss,” simply need to be replaced with a commitment to searching alternative options to find the best solutions.
Integrate Functions. For example, an organization’s Customer Service department is frequently owned by the contact center (voice, chat, email), while a marketing team manages its social media. There’s a silo that needs to be broken down with this relationship in order to keep everyone on the same page and maintain communication between departments.
Critical Analysis. More attention needs to be placed on analytics,
review, and alternative approaches. In particular, risk, probability, and goals
need to be taken into consideration as a critical part of problem analysis and
decision-making. An easy and free analysis tool is the Internet. Simply search Amazon
or Google for a better understanding of your competition.
Welcome failure. We view it as a “bad word,” but it’s part of Success. And an important one. Vince Lombardi got it right when he said, “If you aren’t making mistakes you aren’t trying hard enough.” After all, how many times did Thomas Edison fail before he succeeded?
Curb exorbitance. We all know the expression, “If at first you don’t succeed, try, try again.” And as the previous bullet point states, failure helps us learn. BUT, I do like to make a note that there it is necessary to maintain a balance between the encouragement of innovation and the critical analysis of what is and is not working. Stupid questions may not exist, but bad ideas do. And you need to have the tools and judgment to recognize when you’ve spent too much time or effort on something that isn’t worthwhile. A good decision can be as simple as: stop making the same bad one.
While organizations and environments continue to become more complex and change at rapid speeds, it’s important to adjust your business plan to accommodate these transitions accordingly. Focusing more on Operations can improve the way your business functions, and allowing the decision making process to start at an operational level is an integral part of adapting a more efficient strategy. When decisions are inclusive, they’re more informed. And I think we can all agree that the more informed we are, the better equipped we are to make better decisions.
Dr. Bert Shlensky, president of Startup Connection (www.startupconection.net ) is a graduate of Sloan School of Management at M.I.T. He served as the president of WestPoint Pepperell’s apparel fabrics business as well as the President & CEO of Sure Fit Products. Having provided counseling to over 2,000 clients, his focus is on working with select startups and small businesses.
When you want to stand out, reach out to Bert for the tools that will build your “sticky” brand. My focus is on understanding and analyzing your dilemmas and challenges, so your company becomes profitable faster.
Call (914) 632-6977 or email me at bshlensky@startupconnection.net. Don’t leave without signing up for our useful free eBook!
Feeling stumped or overwhelmed? Contact Bert at (914) 632-6977 or Email to start the process. Thanks!
