Forums: Discussions for entrepreneurs and small business.

A few weeks ago, Danielle Keister, founder of the Virtual Assistance Chamber of Commerce, posted the question "How many small business owners are running everything themselves?"

I think she asked one of the key questions of small business.  I`ll ask it a different way using the entire history of man (in one short paragraph).

For thousands of years we were hunter/gatherers, which took up all our productive time.  Along came farming and instantly 20% of the community could now do something completely unrelated to bringing home the bacon.  Today less than 2% of us are focused on farming and virtually none on hunting/gathering (except by choice).  The other 98% of us are free to choose how to invest our time in "higher" pursuits and things we love doing rather than hunting/gathering and farming.

The Mexican government coined the phrase "The Green Revolution" in 1948 to describe the process of planting 90% in proven seed/fertilizer/watering techniques and the other 10% as a test ground.  Eventually we all learned how to increase our yield per acre.

Two questions -
1) What percentage of small businesses do you think are Hunter/Gatherers?
2) How do we increase our yield per hour so we can get from survival (hunting/gathering) through success (farming) to significance (ability to choose how to invest our time)?


-------------------------

Team Nimbus facilitates peer teams who advise each other from their collective business experience to raise profits in less time, so they can focus on the passion that brought them into business in the first place. We help move their business from survival, through profitable success, to significance.

Can you elaborate on what a hunter / gatherer business looks like? The same for the others?

Are you talking about the owners doing menial tasks?


-------------------------

Great Q -

For me, a hunter/gather business is spending most of its time on survival - shooting everything that moves and eating anything it can pick, because tomorrow is too uncertain not to - tomorrow is not in the planning.  There is little or no discretion as to who they do business with, and have never thought about high-cost customers vs. low-cost customers.   It would also be owner-dependent.  If the hunter/gathering takes two weeks off he starves to death.   I know some small business that net $10 million a year but have never moved past H/G because the owner is too critical to the day-to-day and can`t be gone for 2-3 weeks or the whole thing comes tumbling down.

A "farming" business has figured out how to get more predictable revenue from less time than hunting/gathering, either by dropping high-touch customers and courting more low-touch ones, or by hiring people to work IN the business doing the day-to-day operations while they spend more time working ON the business - planning, improving processes, systemizing, etc.  The ideal farming scenario has the owner doing as little day-to-day as possible, free to take vacations both physically and mentally at any time.

The "significant business" to me is one where the owner is spending so little time farming that they now can work solely on whatever their long-term plan for the business would be - succession by an employee or relative, selling it, involvement in charities, mentoring, being a "green" business, having a positive measurable impact in the community, etc.  At this stage I think the owner is free to truly choose how to invest their time.

If that clarifies, I`m curious as to what percentage of small businesses are in the H/G, farming, and/or significance stage, and how they are increasing their "yield per hour" to get to the next one.





-------------------------

Team Nimbus facilitates peer teams who advise each other from their collective business experience to raise profits in less time, so they can focus on the passion that brought them into business in the first place. We help move their business from survival, through profitable success, to significance.

I would say only a few companies actually work on the strategic level and not the day to day operations level.  (of course I am talking about small businesses here)  A lot of medium and larger businesses will have more strategy due to specialization etc.   I believe that each has its own advantages and disadvantages though.




-------------------------

Smart Capitalist | Coffee Shop Funding | Tyler Weaver Personal Blog

One of the most difficult premises in modern western society involves the question of whether or not societies are the result of natural selection. The seeming majority of "scientists" hold that our individual DNA (genetics) is the single most important factor in determining our actions. As such, we have a "natural" conflict with social groups and forming a society.

I don`t at all agree. People form societies routinely, so the question becomes why? What natural selector(s) find for success in groups versus success as the individual? The hunter-gatherer (nomadic society) is based on the individual surviving alone. The "farming" (agricultural) society isn`t based on farming alone. It`s instead based on the function of groups.

We don`t have as many people involved in farming because when we move beyond that in a society, we develop technology. We also build commerce and trade, communication, transportation, and many other forms of action requiring a society---a group.

I`ll argue that there are two fundamental principles of human life that will always place success of the group over success of the individual. The first is efficiency of resources, the second being transfer of information. Without language, humanity would be just another species of animal. Language provides that transfer and storage of information.

So to examine the question as a metaphor, does a small, single-owner business exist entirely isolated and alone? Is it truly a nomadic structure and economy? Take a street peddler, for example.

How far would the peddler get without goods? Where do those come from? We could then go back to a trapper in 1800 America. They hunted and gathered pelts, doing it alone. But what would they do without a market? Where did that market come from? Isn`t a market a function of a society?

What does it mean to say, even metaphorically, that a micro business is "hunting-gathering?" Yes, I get the idea of using all resources (money from sales) to buy more resources for sale. But the implication is that hunting-gathering is somehow a successful form of endeavor. It`s not. It`s the most primitive form of survival.

Any business that sees itself as hunter-gatherer, in my opinion, doesn`t qualify as a business. It`s a survival method, similar to selling apples during the Great Depresson. As with the development and principles of agriculture, a business requires a surplus of production beyond the farmer`s personal needs, to take to a market for sale. Then it`s a business.

Awhile back, there was a question as to when does a hobby become a business. That topic didn`t develop, and I wonder if it`s because people really don`t know how to make the differentiation. So I`d ask again, what distinguishes basic financial survival from running a business? Isn`t that the same question as above in yet another form?

Just my 2 cents - you hire a capable assistant! You`d be surprised how much they can free you up!

 

 

This is very interesting thing to look at. With the computer, and if you own a small internet business, you are able multi-task, and get things done quicker eliminating having to hire someone to do it for you. How would you look at it in technology age versus the old age of doing business?

I`m not sure the question changes.  If the owner can`t go on vacation without having a significantly negative impact on their business, it`s in survival mode. 

Interesting side-note on technology.  The advent of the desktop computer was supposed to reduce the workload of the employee significantly - all the research shows the workload increased significantly.  Not a surprise - we also spend significantly more time washing clothes since the advent of the washing machine then we did when we washed them by hand.  All technology does is speed up the processes and create more expectations for more and faster production.  Savvy companies buy their employees laptops to take home because research shows they spend 10-20% more time working than those with only desktops.

Back to hunting/gathering.  if the owner of the small internet business can`t take two weeks off, it`s in survival mode and will "starve" if the owner isn`t out their hunting/gathering.  Just guessing here, but I`d say 80%+ small businesses are stuck in survival mode, having accepted the notion that this is the way its supposed to be if you own a small business (or in this case, the business owns you).



-------------------------

Team Nimbus facilitates peer teams who advise each other from their collective business experience to raise profits in less time, so they can focus on the passion that brought them into business in the first place. We help move their business from survival, through profitable success, to significance.

Here`s my .02 cents, for what it`s worth

I think a lot of it has more to do with poor time management skills.

Tick...tock.....tick.....tock...

For most small business owners, they`re simply isn`t enough time in the day. But, if you learn how to use your time more wisely, you actually create more time (get more done, with less time ----- thus having more time left to do more).

Dr. Edward Kramer said it best, "Eliminate the time between the idea and the act, and your dreams will become realities."

Ooops....something just came up, so I won`t be able to go into detail as much as I like, but I`ll come back and post the following.

But in the interim, here are a few things we all can do to buy a few more hours out of the day...

Check email once a day - select a time out of the day you`ll check email and stick with it. Small business owners find themselves peeking in the email several times an hour, and before you know, you`ve probably spent 3-5 hours in the email. For instance, if you dedicate 3 p.m. (and gave yourself only 1 hour), most of the replies and messages could all be done within that hour.

Guess what, you bought yourself an extra 2-4 hours per day (20 hrs in a week). Guess how much time could be saved if you hired an assistant to check mail, and he/she will only forward to you whats necessary.....it`ll take some time to get him/her trained to screen your messages, but you`ll also get more time.

The telephone --- don`t answer it! Pay someone else to answer it. There are plenty of order taking services who will learn your script, FAQs and everything. Yes, it may cost you money, but how much are you losing by answering your phone when you should be working "ON" your business? When you get calls that must be returned by you, dedicate a certain time when you`ll call back...maybe even only schedule 3 days out of the week when you`ll return calls back. Guess what happens...you get more time.

The cell phone....As Dan Kennedy once said, "this has got to be the most evil invention ever created" Folks feel like they MUST answer it when it rings...some people can`t even go to the toilet without having to yack on that device.

Get rid of the cell phone...don`t believe me? Look at your phone bill and convert the monthly minutes into hours. Some of you will be amazed at how many hours you spent on the phone yacking about nothing....if those 14 hours of cell time didn`t produce any income for your business, you`re guilty of wasting time.

Time Management:

Create a schedule for each hour of the day..

Here`s a brief view of mine.

I don`t wake up till 8:30 a.m. (unless one of the kids wake me up first).

9:00 (i check & reply to all email - I dedicate 1 hour)
10:00 (1 hour devoted to writing -- I`m writing a new book)
11:00 (1 hour coaching session)

12:00 (lunchtime 45 minutes to an hour)
1:00 (I watch All My Children -- my favorite soap opera...I got hooked by watching with my mom when I was younger, old habits still remain).

2:15 (1 hour coaching session)

After 3:15 p.m., I`m free to do whatever, I generally work on side projects and play with the kids.

I follow this schedule 4 days out of the week(some days, I don`t have coaching sessions).

One day out of the week I spend 4 hours on marketing/advertising the business. That day is typically on Monday (from 9:00 a.m. 12:00) and I do another hour at 2:00 p.m., and then an hour for emails.

Most of my calls are routed to an order taking service.

I have about 10 different internet biz projects going on, but someone else manages the entire operation and I just collect a check each month. I`m not good with the details of running a day-to-day operation, but the partner I`m with is excellent with that.

I`ll generally get the new business venture started and to the point where revenue is generated and then I turn it over to him. Which he`s good at creating systems, and he eventually pulls out of it because now we`ll bring on employees to run the system.

One day out the month, I`ll spend a few hours reviewing reports/stats, etc...but thats it. Most everything I do can be done remotely. I can stay gone for months and can still operate my business without missing a beat.

Systems must be created. Being self-employed is similar to being an employee. You`re trading time for hours and if you`re not working, you`re not making money. I learned that lesson when I was laid up in the hospital for nearly a week. Almost lost it all as a result of not having a system to run my business. Took me one time to learn.

Anyhow, I gotta run for now, but I`ll continue later.

(And yes..I know it`s 1:30 a.m. at night and what does my time management schedule say about that? Well, I generally take November 15th - January 1st off each year, with the exceptions of my coaching program).

Plus...my wife is in the last stages of her pregnancy and she snores like hell...so I stay up as late as possible now so I can almost "literally" passout once I climb up the stairs and into the bed...at that point, the snoring won`t even phase me:

And with child # 4 being on the way, I`m trying to get as much done as possible before she arrives...

I`ll finish later.

-------------------------

Website Startup Coach: Step-by-Step Coaching to Help You Build a Profitable Business Online!

this thread can be summed up in one word : TUGG

 

It comes down to rules, training, leadership procedures and culture.

 

Think about the haphazard hunters that wander off in a different direction every day. They don’t know what they will hunt or how many they will bag.

 

Then comes the rules. They realize that they only seem to catch the ducks around the swamp and never in the scrub. OK they are never going hunting for ducks anywhere but the swamp, anybody who does otherwise get the evil eye.

 

So they now have a rule for hunting ducks that increases their chances of finding what they want.

 

Suddenly they realise that Ugg knows that rule but Fugg still hunts for ducks in the scrub. Eventually Ugg tells Fugg to not go in the scrub thus they now know about training.

 

Then one day Smugg realises that Fugg forgot to train Lugg the son of Ugg to hunt correctly so Smugg reminds Fugg to tell Lugg to not hunt in the scrub, thus giving rise to Smugg the first leader to them all.

 

Now Smugg is no Mugg and can never remember if it was Ugg or Lug who shouldn’t hunt in the scrub so poor Mugg is left to write down all the rules passed by Smug for Lugg, Ugg and Fugg. Thus the first systems analyst is a poor old Mugg.

 

Then under Smugg happily go Ugg, Fugg Lugg son of Ugg and Poor old Mugg. They know the rules and abide by them every day thus they realise the benefits of a culture.

 

By now they all benefit from the rules and leadership of Smugg they spend less time wandering about thanks to the training of Ugg and with all the rules written down by Mugg they now can always tell what is the best thing to do, at the best time in the best way. And they find that they have so much time to sit around and  play scrabble.

 

Everything went so well that they decided to name their town Tugg.

 

J