Dave Cheong

If someone walks into McDonald’s and asks for a curry, chances are McDonald’s will not make them curry. I’m not talking about adding curry spices to a burger, I’m talking about a full blown Vindaloo. My bet is even if you paid them and brought the ingredients yourself, the store manager is going to say, “Sorry, we can’t accept your money because we just don’t make curry“.

Why is that? McDonald’s probably could make the curry. They have all the cooking implements to do so. Let’s say you brought the ingredients yourself, is there a reason why they couldn’t make the curry? Maybe, maybe not. However, I believe there are several reasons why they won’t do it. This article discusses a few of them, in particular the importance for a business to stay focused on their objectives and send a consistent message to consumers about who they are and what they do.

Being focused

Recently, I wrote about the Top 14 stumbling blocks for new businesses. In that list, one of the things small businesses have to be mindful of is not chasing any and every sale. Why not? When you’re starting out or simply operating in the small business space, in the most likely scenario your resources are already stretched. If you diversify your energies and focus on too many initiatives, projects and clients at the same time, chances are you won’t be able to give any the attention it rightfully deserves.

Instead of doing a single job well, what you end up with is a number of mildly satisfied clients and a mediocre track record. For small businesses, especially those that operate on word of mouth advertising and testimonials, doing things in a mediocre fashion can be poisonous to their ongoing survival. Maybe this is a little extreme, but in many cases, the reality is one might as well not bother being in business at all.

Sending out a consistent message

One of the things that make McDonald’s successful is their branding. I’m not sure about you, but of all the burger joints out there, I would hardly classify McDonald’s as the best in terms of taste and overall quality. However, that doesn’t stop me from dropping in every now and then when I’m famished or after a boozy night out with some friends.

Now ask yourself, why is that? Given that McDonald’s isn’t the best tasting burger joint and certainly not the best thing for you healthwise, why do so many people all over the world flock to the Golden arches? I believe it has a lot to do with their branding, messaging and customer expectations. People go to McDonald’s because when they think of having satisfying fast food, they think of McDonald’s. They go there expecting a certain thing and they always get it.

How would all that change if McDonald’s started serving you, alongside their traditional Big Macs and Coke, a gourmet inspired Indian curry? The message just doesn’t gel, does it? It doesn’t matter how cheaply they can do it or how nice the curry would taste. The bottom line is, companies need to spread a consistent message about who they are, what they do and what customers can expect to get when they hand over their money.

Concentrate on the core business

So far I’ve used McDonald’s and curry in a useful metaphorical sense. From a literal sense, what if you did go up to the counter and offer $500 for a curry. Should McDonald’s take you up on that offer and make the curry for you just this once?

For McDonald’s, I think the answer is no. For small businesses, I think the answer is it depends. McDonald’s shouldn’t do it even though it’s tempting because they need to stick to their strategy. Making curry just once, earns them some money and kudos now but does nothing for the company in the long run. That move is not consistent with their overall strategy. It sends mix signals to the market place and within their own team. Doing adhoc requests just once, sets a precedence for more. What happens when someone else comes along and ask for curry? Or Mexican food? At what point do you say no, and how would you select who you say yes and no to?

I think many small businesses often face a similar problem. It’s often tempting to accept a piece of work even though it is not that company’s core business. If a piece of work gives your company another 6 months of income, then it’s worth considering. After all, that could mean you stay operating for another half year vs closing down for good. For smaller jobs, I think it is a definite no. The strain on the resources for the company would mean less time, money and brain cycles on the things that matter. In a competitive environment, taking your eye off the ball just for a split second could spell death for your fledgling business.

From a branding perspective, I think doing things that are not core to your business can take away the thing that make you special in the market place. In order to be special, small businesses have to focus on doing one or two things really well, instead of bits of lots of things. What you want to be known for is being special at one or two of those things.

Specialisation and streamlined processes

Being focused isn’t just important for small businesses. For big businesses, like McDonald’s, being focused allow them to specialise, refine what they do and how they do it. Instead of hiring 10 people and training half of them to be good at flipping burgers and the other half to be good at making curries, McDonald’s consolidate all its resources and create a single unified workforce, aligned to a common goal.

It’s been widely written that specialisation leads to a more effective workforce - employees only need to concentrate on doing one thing and do it well. In McDonald’s case, anyone can come off the streets and become an employee. If one person leaves, another can easily replace them. The point here is the effectiveness of a McDonald’s store isn’t tied to any single person. In every aspect, McDonald’s operations are turn key - that means what they do is repeatable and consistent, irrespective of the people involved in doing the actual work. As a result, you can be fairly certain a McDonald’s store in one neighbourhood produces burgers that taste the same and the overall quality is consistent with another store.

In that sense, if you walked up to the counter and asked for curry, chances are they won’t be able to do it. Their equipment and staff are trained to be efficient burger producers and only that.

Spreading overheads and economies of scale

Overheads are things that exist in a business which must be present in order for the business to operate. Different businesses have different overheads. For McDonald’s their overheads are things like electricity, real estate, fixtures and fittings, cash registers, cooking equipment and burger grills. Without any of these, a McDonald’s store cannot possibly continue producing.

However, McDonald’s also utilise specialised equipment to ensure overall quality and consistency. These equipment are essential ingredients in the burger production process. It allows McDonald’s to do what they do cheaply and efficiently.

Let’s imagine, McDonald’s started making curries for the curry lovers out there. What’s going to happen? In order for them to be able to make curries as cheaply and efficiently as they can make burgers, McDonald’s is going to have to invest in and then utilise specialised curry making equipment. In order to be commercially successful on a global scale at both, they’re going to need two sets of specialised equipments at every store. It doesn’t take much to see that this is going to cause all sorts of logistical problems including shop layout, equipment maintenance, staff training etc.

What does this mean to small business owners?

Why would you not be able to get curry at McDonald’s? You won’t because even though you pay them, it is not in their best interest to make and sell you curry. As metaphor, it is useful for remembering the importance of being focused on doing a few things right, sending consistent messages to the market place and employees as well as the efficiencies that you can get by concentrating on doing a few things effectively.

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Improve your life one step at a time

I used to work at a job that demanded 60+ hours a week from its employees. Maybe “demanded” is too strong a word - certainly the company seldom asked outright for us to continue working at 10pm on a Friday. However, when all your fellow team mates are still at work and have full intentions to be in the next morning, you feel pressured to doing the same yourself.

To be fair, I didn’t have to. No one was forcing me to do crazy hours. After all, my employment contract says I only needed to work 40 hours each week. However, as I learnt the hard way, these things often reared their ugly heads during annual performance reviews. If you were an employer, who would you reward? The guy who stayed till 10pm or the guy who left at 5:30pm sharp?

As it was my first job out of university, I wanted to impress and went along like everyone else. For three years I worked for this company content with the fact that every annual review I had was exemplary. I was performing well compared to my peers. I had this career thing worked out. I was on top of the world.

Wrong.

I’ve long since left that job, having burnt myself out completely. The thing that stuck with me most from my experience there was the fact that about three months after I left, people didn’t even remember my name or care about what I did or how I’d spent every weekend consistently at work for six months. I can’t blame management - after all the project has to survive the people involved in it.

Since then, I knew I would never be truly happy being an employee for another faceless company. I gave 150% for three years of my life. What did I get out of it? Recognition from my superiors? Respect from my peers? A mediocre bonus during Christmas for a job well done?

Perhaps that’s enough.

For some people, yeah, this is enough. For me, I’m just wired differently. I feel that God has given us the ultimate gift called Life. However, we only have this gift for a limited time. How long remains to be seen. He has left us with a choice to choose how we spend our time. This precious gift should not be squandered on doing things that don’t matter to us. Life is a collection of our experiences, thoughts and feelings. If our actions do not positively contribute to these things, are we not wasting our gift?

Why are we even bothering?

Do you want to spend 60+ hours a week working for someone who doesn’t know your name? Is it wise to sacrifice the best years of your young adult life enslaved to an organisation motivated solely by the bottom line and the share price?

No.

Every moment you spend at an unhappy workplace is another moment you don’t have to spend pursuing your dreams. Most people think pursuing dreams is a thing you do next year. The thing is, there is no next year. There is only now. You exist here and now. If you are unhappy with your current work situation, you owe it to yourself to do something about it.

Not next year. Not tomorrow. Right now.

There is never a better time to make a change. Ok, sure you might be better prepared next year or more financially secured. However, most of the time, the only thing holding us back, is our own fears. Nobody wants to fail. That’s true, but I’d rather not live my life knowing I didn’t try because I feared to fail. After all, our limitations are self imposed.

Ask yourself - Are you a happy employee? For some people the answer is yes. In which case, I’m truly happy for you. You are one of the relatively few people who are lucky enough to have found a vocation that is fulfilling. For the rest, if you are unhappy about your current work situation, you need to find out the reasons why and do something about it.

I’m not asking you to quit your job. I’m not asking you to throw away the four years you spent studying for it. What I’m asking is for you to look at yourself and your surroundings. Are you happy doing what you’re doing? Do you wake up each morning and look forward to doing your life’s work? Is it something you love and admire?

For me, what I want to do is transform “working for” to “working with”. As an independent software contractor, I think I’m somewhere in the middle. I’m responsible for my own career. I pick the projects to work on and the clients to work with. If I feel like it, I can take three months off between contracts.

However the reality is, I’m still committed to a 9 - 5:30pm work day, five days a week. My income is proportionately tied to how many billable hours I do. Ultimately, I’m building someone else’s dream.

What I aim to attain is to be a fully fledged Entrepreneur - building businesses that contribute real value to my customers in the industries I’m interested in and deeply passionate about. I’d like to wake up each morning, eager to check how things have gone on while I had been asleep. I’d like to spend the day, thinking about ways I can improve what I offer.

Being an Entrepreneur is not for everyone. I believe each of us has a calling, something we’re naturally pre-disposed towards. Steve Pavlina even goes so far as listing 10 reasons why you should never get a job. Life is a journey. It is about seeking this calling and fulfilling your life’s purpose. It won’t be easy. You will need to approach it one step at a time.

In conclusion, ask yourself - Are you a happy employee? If you’re not, why and what would you rather be doing? Seek your life’s purpose. Do what you have been put on the Earth to do. In the end, you will live a happier and more fulfilling life.

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Developing positive patterns

In the last couple of days, I’ve been doing some research on the challenges typically faced by new businesses. It turns out there are plenty throughout the early stages. Starting and growing a new successful business is a skilful balance between talent, timing and luck. Mostly though, I believe it is about recognising common mistakes and avoiding them.

This is a list of what I consider are the top 14 stumbling blocks for new businesses. Most of these stumbling blocks seem obvious on the surface. However, from what I have read, many businesses fail to avoid them nonetheless. This may serve as a timely reminder to the budding Entrepreneurs out there.

1. Bad initial concept.

At the core, I believe all businesses need to create value. Although the implementation is key, it wouldn’t hurt to start with a good idea. A good idea is one which fulfills a genuine need and has a unique selling proposition.

2. Inadequate planning.

I believe having a business plan really helps, even if it is sketchy. Firstly, the act of writing the plan forces the founding team to think through the steps and map out the landscape they will be operating in. Secondly, the plan can be a good communication tool between the parties involved.

3. Failure to do proper research.

Starting a new business takes time, money and commitment. I believe it really pays in the long run to research the opportunity, industry, domain specifics and competition before jumping in. A bit of work in the beginning can save you a lot of grief later.

In addition, some find professional help and mentors useful. I think it depends a lot on who is providing the help and in what form the help comes. However, anything you can do to avoid the same mistakes others have made has got to be a good thing.

4. Insufficient capital.

Many businesses fail because they under capitalise. The level of funding required depends largely on the type of business, barriers to entry and the skills composition of the founding team. Some industries just takes more starting money to create a viable business than others. Whatever your industry, I think it is important to understand what the cost requirements are before you start.

A key question to ask yourself is how long the business can survive before making that first sale. As a general rule, err on the conservative side - it tends to take longer and cost more than what you think.

5. Poor cash management.

Having sufficient funds is essential for any business to stay alive and grow. There’s no doubt about that. It doesn’t really matter how brilliant an idea is or how clever the founders are. If there isn’t sufficient cash in the bank to pay the suppliers, employees or monthly bills, a business cannot remain operating for long.

Apart from ensuring the ongoing survival of a business, I think cashflow management can enable a business to capitalise on opportunities as they arise. Why else do you think Microsoft has $50 billion in the bank for?

6. Lack of business domain specific knowledge.

Every industry operates in different ways. I believe having a good understanding of the market dynamics is important. It isn’t enough to just be an expert in your particular product or service. The deciding factor between success and failure could be a business’ ability to recognise and respond to changes in the market place. Having domain specific knowledge and a solid understanding of what customers need are essential ingredients.

7. Chasing any potential sale.

Some projects and customers have less strategic value than others yet may require the same if not more effort to work with. I’ve found this to be the case in my professional work as a Software Engineer for hire. There are clients who just don’t understand technology and it can be an uphill battle working with them.

In a small (but busy) business, the resources tend to already be stretched, so chasing all sales opportunities can be time consuming and wasteful. I believe it is more important to focus on the quality and not the quantity of a sale. As the saying goes, if you try to catch all the rabbits, you’ll catch none of them.

8. Late billing and collections.

I think this goes hand in hand with cash management. Concentrating on the product or service a business produces is important but being able to recover the costs and make a profit is essential. After all, cashflow is the life blood of a business. For new businesses especially, I think they have to be extra careful and ensure they are charged correctly, billing cycles aren’t too long and customers pay on time.

9. Lack of focus.

A new business can go through several iterations before its form and shape is finalised. In some instances, the part of a business that finally takes off may not even be something the founders had originally envisioned. I read this all the time. To me this is fine, as businesses must adapt as they learn more about the customers’ needs and usage patterns. However, I believe a business must focus at some point to turn a plan into action and actions into results.

10. Lack of internal control systems.

Running a business well is about having the right operational procedures. Internal control systems play a key role in ensuring that the right procedures are followed. To me, this is pretty important - without the right systems, how can you possibly manage the cost, ensure financial compliancy, timely invoicing, accurate product dispatches etc?

One thing I didn’t find much information about though is the fact that the type of systems put in place should probably match the size and complexity of the business. A simple business is unlikely to need a powerful reporting solution for example.

11. Hiring the wrong people.

Although I believe in being a generalist, I also believe when the time requires, hiring the right people can be beneficial for a growing company. A common mistake Entrepreneurs tend to make is not hiring the right skills when needed especially when they have solely been responsible for getting the business to its current successful state.

In addition, I think it depends a lot also on hiring the right people - not just people with the right skills but people who are best for the company. Ill fitted people on a team can adversely affect the productivity of the entire team as a whole. Choosing the wrong people can change a company’s dynamics and destroy whatever it is that made it unique and successful.

12. Reliance on few suppliers or customers.

Running a business is about managing risks. To me, businesses that rely on a few suppliers or customers are operating under risky conditions. Any change in the relationship or circumstances can significantly affect such a business. For example, how would a business cope if their primary supplier decides to increase the cost of all products by 5%? Or what impact does it have on a business when its only major customer decides to move their business elsewhere?

13. Not having enough perseverance and resilience.

It’s hard for me to say for sure, but it seems to me some businesses fail because they do not persevere long enough. There could be several reasons for this. Perhaps the founding team underestimated the timelines. Or the enthusiasm and passion have dried up. Whatever the reason, sometimes building in the redundancy and resilience is enough for a business to weather the storm and emerge victorious at the other end.

14. Insufficient performance metrics.

It’s pretty important to have metrics you can use to measure how you are progressing. It doesn’t matter in what area the business operates in, metrics that identify cost to produce goods, sales, productivity etc is essential. Sometimes what you think is happening can be completely out of synch with reality. Without timely metrics, management cannot make informed decisions.

Running a new business on your own can be trying and stressful. However, the rewards can be fantastic too. How successful you are is only limited by your own creativity and hard work. If you run a relatively new business, ask yourself how many of these common stumbling blocks have you encountered? Perhaps more importantly, think about the mitigating actions you can put in place before they occur. Avoiding some or all of these common stumbling blocks could be the difference between your business surviving or otherwise.

In my research, I found the following resources useful and inspirational:

• 10 stupid mistakes made by the newly self-employed
• Ready to start your own business?
• 7 biggest mistakes of business startups
• 12 most common mistakes new entrepreneurs make
• 10 mistakes new design businesses make
• Top 10 mistakes that entrepreneurs make

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