We all recognize the importance of change, but also need to consider volatility in affecting change.
Take the stock market, for example – it’s like a rollercoaster influenced by economic twists, social vibes, and market moods. Recently, in 2023, the S&P 500 went up 17% from January to July, then down 11% from July to October, only to bounce back up by 11% from October to November. Minimally, you should evaluate investing for short-term change or simply investing for the longer term.
Rapid Evolution in Our World
Our world is evolving fast. Technology, our tastes, and what’s considered normal are flipping markets on their heads. Leisure, travel, and entertainment are booming unexpectedly. Even the diet industry is getting a facelift thanks to new drugs helping people shed pounds. It’s a game-changer.
Social, political, and economic events are regularly disrupting our environment. From weather havoc to terrorism, it seems like endless crises.
Managing Unpredictability
How do we handle all this unpredictability? First, we’ve got to understand volatility and figure out how to manage it. When bridges suddenly collapsed in Philadelphia and Los Angeles, they were fixed in record time – thanks to clear goals, teamwork, and innovative solutions. We need the same approach for everything, from health issues as we age to dealing with climate events and political shake-ups.
Take our health, for instance. As the years pile on, it’s a good idea to play offense. Waiting for a health crisis to hit is like playing catch-up. Hitting the gym, eating a bit healthier, and throwing in regular checkups are like the MVPs in the game of avoiding health rollercoasters. Same goes for other bumpy rides, like dealing with the economy, wild weather, or political shake-ups.
Look at how we’ve been stepping up our game in handling weather drama like fires and hurricanes. It’s all about staying on top of things, being ready, and finding solutions. That’s the playbook we can follow for other curveballs that life throws our way.
Emphasizing Communication and Cooperation
Communication, coordination, and cooperation should be our priorities. Fire departments focus on safety and prevention rather than just enforcing laws. Why can’t we do the same for issues like crime, making things better between police and communities?
Rethinking Progress and Success While Being Aware of Bias and Risk
It’s time to rethink progress and success. We’ve made huge strides in areas like reducing smoking and drunk driving. Reviewing plans is important, but we need to do it together and be open to expert advice for better problem-solving.
Don’t forget about bias and risk: Bias is, perhaps, the biggest culprit in unreliable results. “It won’t happen to me” may be the greatest cause of unexpected volatility. Here’s the thing. We love to be right. We hate to be wrong. So, we will go to extraordinary lengths to make sure that we’re proven correct. And we won’t even know we’re doing it. Our brain, working surreptitiously in the background, doesn’t alert us too how biased we actually are.
Creating a Supportive Environment and Setting Specific Goals
Creating a supportive environment, both physically and socially, can help us deal with crises better. This includes a safe, productive and supportive physical space, along with social and businesses practices that are fair, consistent and understood can significantly add to the capability to deal with crises.
Getting specific with goals and solutions is key. We all get the importance of goals, but sometimes we spend too much time pointing fingers instead of finding solutions. Take a cue from success stories like fire safety and emergency highway repairs.
It’s all about staying open and analytical. Businesses need to understand their environment, learn from both wins and losses, and be open to new ideas. In other words, don’t be like Jack Nicholson saying, “You can’t handle the truth.”
Embracing Change for Better Solutions
In a nutshell, recognizing that change and ups and downs happen is the first step to tackling problems. We need tools to understand and predict change – just like we do with things like COVID and flu shots. Being prepared and understanding volatility will lead us to better solutions and alternatives.
Dr. Bert Shlensky, President of www.startupconnection.net, offers experience, skills, and a team devoted to developing and executing winning strategies. We guide your plans for business success and unlock your profits.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.
We welcome comments, suggestions, and questions. You can write us at: bshlensky@startupconnection.net or call at 914-632-6977.
Which line is longer? You may think it’s the middle line because the arrow points jut out. But the truth is, they are all the same size! You might not have figured it out if it was not pointed out to you. We tend to hang on to our initial perception of a situation or a problem, because we believe in deciding things as soon as we can. In some things, such as the belief that grandparents are allowed to spoil their grandkids, you will run into no arguments. But in other things, a little perspective can help immensely.
The economy has several measures of progress and each of us uses the one which support our perceptions of growth or decline A current trend since the pandemic illustrates how critical perceptions can affect our opinions and policies. For instance, income inequality is increasing as evidenced by the fact that 69 percent of the total wealth in the United States was owned by the top 10 percent of earners. In comparison, the lowest 50 percent of earners only owned 2.5 percent of the total wealth. and that many Americans don’t have $400 to pay for an emergency. On the other hand, the collective net worth of the bottom one-fifth went up from $3.3 trillion in 2019 to $4.2 trillion at the end of the second quarter of 2022, indicating they can finance a better lifestyle.
What is critical is that we understand our perceptions and their impact on our decisions, activities, and behavior.
A critical factor is our perceptions of the presenter, the environment and the communication. Licensing agreements, celebrity endorsements and great environments are all designed to make the audience comfortable with presentations, but we seldom acknowledge how they affect our individual behavior. It’s great to have a convention in Honolulu to present your ideas, but if everything about the presentation is solid, it should work just as well in Dubuque, IA or Nome, AK. Environment is important but it should supplement and enhance a convincing presentation, and not be used to make up for incomplete or inadequate data. For instance, a steakhouse can have the right look, but if the meat is not tender and does not deliver the expected flavor, no one is going to dine there after a while; they might find the local diner more appealing because you get what you are looking for in a meal.
Our perceptions frequently exclude key data or are based on highly uncertain information. While they are present in our environment and affect our decisions, we usually avoid consideration of issues like religion, intelligence, politics, wealth, sex, morality, and appearance in our discussions. Part of that is simply out of politeness, but it never hurts to take that into consideration when deciding on a course of action or a strategy to take. In contrast, we may express opinions about issues like climate change, politics, immigration, electric cars and artificial intelligence with insufficient knowledge or analysis. Again, we often let our initial perceptions do the analyzing for us. Patrick Mahomes and Travis Kelce are great football players, but do they really know so much about life insurance that you would automatically go with State Farm? One would hope you would do as much homework on which insurance company to go with as they did as to which insurance company to endorse! After all, they don’t want to waste their time and money either.
One of the most significant aspects of behavior is our perception of information. For example, I believe people don’t take enough risk. How much freedom do you allow innovative people to break rules? When do you provide support versus challenging subordinates and colleagues? While there may be analytical solutions to some of these, our predispositions are frequently more important in determining how we respond. But thinking outside the box, stepping away from perceptions, can lead to greater clarity. Risk does not always mean throwing a dart blindfolded; it simply means going against what you consider the norm, through research and analysis. Remember what Davy Crockett said:
Bias is critical issue in perceptions. 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, assessing Covid accurately is problematic due to varying demographics such as age, race, and other factors that convolute the analysis. In many cases, these can be understood, but are still challenging.
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. At the end of the day, you want the best person to handle the responsibilities you give them, and you want to remove anything that impedes that decision. Again, what seems like a risk has been whittled down to where the risk is minimal.
Cultural and environmental factors also affect bias. Dress, demographics, weather, location, and culture all affect perceptions in the decision-making process. These can also be used to your advantage in talking to colleagues by increasing bonding with similar people. Whenever I meet someone who is also from the Southside of Chicago, agreement on differences becomes much easier.
Style and personality greatly affect perceptions. Race, sex and age are the most common factors. Differentiating personality types like “right brain or left brain” or analytical versus creative greatly affects perceptions. For example, we greatly underestimate the positive or negative impact of using math in many arguments.
We also need to consider the timing of perceptions. In general, the audience, whether on the internet or in person, forms perceptions of a presentation in the first 90 seconds. That does not seem to be much time, but the right focus and the right keywords can get the train going and make for an exciting ride. Now, as an admitted nerd, my presentations can be a little boring. Thus, I try to improve their acceptance rate through tools like editors, comedy, stories, and pictures. I have learned the hard way that my poor spelling has sidetracked some of my best arguments. Thank goodness someone invented spellcheckers!
Let’s start a conversation – no matter what stage you are in with your business. As an exercise, tell us how you have better managed perceptions, or been victim to its bias. Then, tell us what areas you to need focus on in order to see improvement.
Dr. Bert Shlensky earned a PhD from the Sloan School of Management at M.I.T., mentored a few thousand clients at Score and his own practice, grew Sure Fit products from $ 50 million dollars 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.
In short, he knows what works and can help you lead your company to greater profitability and success. Find out more at StartupConnection.net, or email Bert at:
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
“If you aim for nothing, you’ll hit it every time.” These wise words from the famous author, salesman and motivational speaker, Zig Ziglar, are precisely why we must set clear, specific goals. Nearly every plan, budget, and proposal start with goal setting and establishing focus. In business, the next recommendation is to make a profit. The rest of the plan then details the programs to achieve that end.
It seems simple enough, right? However, the process of setting goals is far more complicated and can facilitate the remainder of a planning process.
A key issue in developing business and personal goals are the parameters. Even in sports, where the general goal is winning, there are complexities. For example, the goal of minor leagues is more about preparing players for the majors than winning every game. And in little league, things like development, training, participation, and teamwork can be as important as winning.
Goals also operate within the context of other needs. What are the opportunity costs of other activities? What are the costs, investment requirements, and rewards of an effort? What are the social, legal, and environmental considerations? How important are issues like innovation, time, safety, culture, and the whole group in an effort?
Here are some recommendations to consider in developing goals:
Exploring and understanding profit can add dimension to your goal setting. There is more than one description of profit. Some include: long-term profit, short-term profit, cash, present value on investment, profit before or after depreciation, interest or other factors, and expected value discounted for risk. Understanding profit and investment requirements also differ for service, retail, manufacturing, technology and other types of companies.
To compare varying goals, let’s look at small business entrepreneurs and venture capital investors. The small business entrepreneur is mostly concerned with earning enough cash to pay bills and stay in business. (If you recall, 90% of small businesses go out of business within five years.) Venture capital firms are looking at multiple investments and expecting that enough will make significant profit in a few years to more than cover the unprofitable ones. Even the venture capital business has changed dramatically in the last few years. Initial investments are smaller and for shorter periods, profit expectations are more carefully reviewed, and growth expectations are more reasonable.
Measurement is a critical aspect of goal setting. What, when, how and criteria of how we evaluate an effort are critical in decision-making and goal setting. For example, we debate the potential and impact of a recession. However, there are several different ways to measure it such as length, type, impact, etc. Measurement can also be considered from an absolute or relative perspective. In little league, showing up is frequently considered excellence. Improvement from a weak team can also be considered excellence while winning a championship is expected from the best teams. So, knowing what your measurement parameters are is key. Consider cooking, for example. We know measurement is critical, but when a recipe calls for a pinch, dash, shake, and smidgen… what exactly does that mean? It seems like only grandmothers really get it right.
Don’t forget about bias. Bias is, perhaps, the biggest culprit in distorting the development of goals. For example, when evaluating performance, profit can reduce the importance of variables like quality, customer service, logistics, etc. Bias can also cause issues because many non-quantitative goals are more difficult to measure. For example, sports teams generally focus on winning rather than development, culture, or team concept, which may be more important. Look how many teams in various sports have failed by trying to hire super stars and ignoring other requirements for winning.
Timing and time parameters are crucial. Long-term versus short-term is the most frequent difference. However, periods of time are also important. For example, the stock market has been highly volatile in recent years. 2020 and 2021 saw significant gains, 2022 saw significant losses, and 2023 appears to be regaining much of those losses. Goals will vary depending on whether you need cash immediately, are saving for your retirement, investing for inheritance, or any number of other needs and the timeline they require.
Flexibility is key. Businesses are subject to more radical change and need to build adaptable mechanisms into their processes. As we face more uncertainty and instability, we need to focus on changing and simplifying processes to reduce the risks, and our goals must align accordingly. Strategies like pivoting and develop/test/measure/adapt need to be built into our organizations.Examine alternatives and change when necessary. Reevaluate a system that isn’t working and set new goals that will yield worthwhile measurements.
Human and cultural factors must also be considered. How important are excellence and change in our processes? How much innovation effort is in our programs? How complex or detailed are our goals? And keep in mind that customer, supplier, and employee satisfaction can dramatically affect results.
The debate of pursuing improved excellence versus change is affected by a number of issues. We need to understand how problems affected by goals versus tactics can require different solutions. The most frequent issue with change is insufficient support and operations. For example, excellence in quality, delivery, and customer service are even more important during periods of innovation. As change is inevitable, organizations simply need to understand their new environment and execute fundamental change.
Make goal setting a priority and communicate your goals to those involved. Be certain to understand the varying needs of different situations. Use clear and simple measurement tools, and be sure to utilize the process for improvement, rather than criticism. And remember, we set goals to make progress, and even if we don’t achieve what we set out to accomplish, we still end up further along than where we started. So, stay focused on your goals, make them work for you, measure your growth, and keep moving forward.
Dr. Bert Shlensky, President of www.startupconnection.net, offers experience, skills, and a team devoted to developing and executing winning strategies. We guide your plans for business success and unlock your profits.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.We welcome comments, suggestions, and questions. You can write us at: bshlensky@startupconnection.net or call at 914-632-6977
Have you ever met someone and, after they introduced themselves, you forgot their name within seconds? Why does this happen? Why does so much information go in one ear and out the other? Are we at capacity and simply cannot retain any more data? Or are we too distracted thinking about what we’ve going to say next? Why are we not listening to each other?
Listening is key for communication and building positive relationships—both personally and professionally. When we improve listening, we improve our interpersonal connections and our collaboration skills.
When it comes to getting others to listen to you, think about how you are presenting the information and how you want it to be received. Consider factors like timing, delivery, and environment. When, where, and how are you telling someone something? In general, the audience, whether on the Internet or in person, forms perceptions of a presentation in the first 90 seconds—that gives you a small window to capture their attention and make a good impression. Environmental issues can be the most ignored factor in communication. For example, if you’re giving a presentation in a room that’s too hot or has a lot of distractions, your audience is less likely to retain what you say.
Additionally, when we engage others genuinely, they are naturally more inclined to pay attention. Too often we underestimate the power of a smile, a kind word, an honest compliment, or the smallest act of caring. The most effective tool to enhance listening that I use is the “out of the box” approach of “FOOD WORKS.” Fruit and penny candy are truly unheralded aids in making a great presentation.
Here are some specific suggestions to help improve our own listening as well as get others to effectively listen to us:
Have a clear focus especially with regard to goals. Time frame, perceptions, quantity versus quality, topic, and especially the sharing of goals can critically affect listening. Providing an outline is helpful so people can see what will be covered and can easily follow along.
Don’t ignore bias. Whether we admit it or not, we all have biases. And it’s a huge problem when it comes to listening. Analysists love to discuss mathematical formulas and measurement in affecting bias; however, most bias (especially in small businesses) is simply human. For example, our most recent experience, preferences, and desires can have a significant impact on what we hear.
Be willing to hear both sides. It’s important (and frequently imperative) to take risks in order to expand, grow, and adapt. By listening to the real benefits and potential consequences of actions, you may be willing to take more chances. Additionally, this will help you make more informed decisions overall.
Don’t assume people know what you’re talking about. For example, common business terms like Gross Profit, EBITA, Clicks, Conversions, Fixed Costs, and Investment may not be understood by some of the audience.
Be clear and concise. Simplify wherever possible and focus on factors that really affect your presentation. The audience will lose interest if the presentation is too long, complex, or poorly communicated.
Be the expert. If you’re not confident in what you’re saying, you’re more likely to communicate it wrongly or ineffectively. Make sure you know what you’re talking about.
Prioritize openness. Does the listener trust what is being said? And does it cover relevant issues? When we share information openly, we establish a sense of trust.
Actively look for ways to improve. Discuss challenges and opportunities. For example, if miscommunications are happening, find the source of the problem. Is it coming from the presenting side or the listening side? You can then implement supportive strategies.
Understand the audience and diversity. Demographics are affected by age, location, socioeconomic status, race, gender, etc. Current events have certainly affected trends for many minority groups. Staying up-to-date on your target audience, the issues they face, and their habits will help improve your awareness and communication.
Listening should always be a priority. Understanding the purpose, content, and importance of communication can help you improve outcomes. You should also consider your own listening process. The next time you catch yourself asking someone to repeat their name or find yourself zoning out during a presentation, ask yourself why? Figure out where the communication failed and learn from it. Maybe the speaker wasn’t being clear or maybe you’re someone who needs to take notes or repeat a name out loud in order to retain it. The more you understand your own communication strengths and weaknesses, the better equipped you’ll be to listen and be heard.
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. For more information, please visit our website: www.StartupConnection.net.
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!
