i want to build a 10 million dollar business !
DESCRIPTION
Business beyond Marketing ! While building business you need a structured metrics to achieve a scalable growth. See how it is framed.TRANSCRIPT
I want to build a
10 million dollar
business !
4 Metrics of Business building
M
Ba 20
How To Grow From A Small Entrepreneur To A Big Business ?
A key thought that often keeps troubling most entrepreneurs is :
Some want to go on a long leave and manage operations like a CEO of a large corp. without hiccups !
Others want to grow quickly to an eye popping $10 million business.
Since I have been an entrepreneur who has gone through the grind and also worked in mega
corporations
I thought I could try provide some of the answers that would help bridge the gap.
An entrepreneur often needs some structured thinking ( they teach that in management schools ) to scale up her
operations to the next level.
But most entrepreneurs like Bill Gates or even the mom and pop shop next door don’t have the time or patience to learn what they call ‘all the crap’ these B schools teach.
If you want the entire module it is in my book The Project Management Time Cycle ISBN 1440493331 which I don’t suggest you buy. Frankly it may be a little too complex for the uninitiated, as it is aimed at the seriously big, written for
resource optimization in large projects .
So I will show you few easy ways of how to structure your business to a scalable format.
First thing you want is to define
Your business need and goal :
To define your “Business Need” you muststructure it into the 4 Metrics of business. These are also called the 4 constraints of
Project Management.
4 Metrics Business
•Scope of Work or Service Deliverable
•Time specified from start to completion of work
•Budgeted Cost of the deliverable
•Quality of Service that you want to deliver
As they are essentially talented, most entrepreneurs want to plan all this in the mind. Surprisingly many of them succeed, because of their strong vision and deep commitment , at least for some time.
… but employees can’t read your mind !
Employees want a structured route map to follow. Without that you cannot get the desired output from your employee and entrepreneurs hit a road block as the grow.
So many struggle even after finding clients and business, not knowing how to grow to the next level and few never make it big .
……so break up your business goal into the metrics format, so that you can
know exactly where you are tripping up!o break u
Scope : Define your long term goal in terms of scope and break it up in short term, annual / quarterly targets
Each target must be clearly defined in terms of scope of work / revenue target /number of customers / or any other quantifiable goal.
If you want to be an owner of a fast food chain , you must clearly define your scope of service.
….What you will serve?
….. Whose taste buds you will look to satisfy (Italian, Chinese, the
steak lover or vegan)
…..The size (50 seater or 100 seater) and the style of the food joint….
…..The number of joints you want at the end of each year.
….. And surely your target revenue.
Convert your entrepreneur dream into brick and mortar by defining SCOPE.
What is your business deliverable? Clearly define your scope of work with exclusions.Check the revenue generation capability of your service either from industry data or from market survey or through professionals and experts.
Fix your time scheduleGoal setting is incomplete without defining time . If you want to replace Facebook as the world’s biggest social network, then you must plan and schedule for your first million customers within a realistic time frame.
Annual target / 1 million customers
1st Quarter / 100,000
2nd Quarter / 3,00,000
3rd Quarter / 6,00,000
4th Quarter / 1000,000
Work out the quality aspect
This is usually challenging for the first time entrepreneur. If she wants to challenge Facebook, she must know how to make her website cool and interesting for teenagers . She must have developers who can write code quickly and accurately for new happenings. She must have servers to withstand the load of a million downloads without crashing, and have a team to ensure that the customer turnaround time is minimal and trouble free.
Quality Certifications help
If you are an software developer or a garment factory or an advisory service, the quality is normally defined as per any acceptable industry standard like Microsoft approved partner / ISO 9001 / any other Government or major industry body standard or even your own internal quality norms.
To Grow Big Define Quality First
REMEMBER : YOU CAN NEVER GROW BIG WITHOUT SETTING DOWN RIGID QUALITY STANDARDS FOR PERFORMANCE.
For Zuckerberg it was creating a network that ensured servers did not crash like the Harvard servers did when he wrote his now infamous but highly popular ‘grade the girls’ app.
Work out the cost of dreams
Budget the cost. The cost required to achieve the defined deliverable and clearly identify the capital adequacy for the project. You will have to work out the projected financials. The profit and loss and balance sheet along with the cash flow statement, the break even point and the rate of return. This would need number crunching with the help of those who have been through the grind or with help of experts after studying the industry data.
The cost defines the product pricing
RIGHT COSTING LEADS TO ACCURATE PRICING
Prices initially are closer to costs than at a later stage.Pricing it right means both knowing your segment and increasing margins as you grow.Established FMCG multinationals price their products from 6 to 20 times the manufacturing cost to pay for advertisement, promotion and cost of scaling up operations . A nuts and bolts company could mark up their budgeted cost by just 1.5 to3 times, while a software developer could mark up her project cost by 40to 50 times to take care of high risk of failure and obsolescence.
Jot down all the details you have of your present business and work to find out your route map (present position in terms of your goals) within the 4 metrics framework
i.e. Scope, Time, Quality and Cost.
Locate your self on the route map
Find out where you are .Where you want to go?
For you can’t scale up your business to the next level unless you can clearly define where you are today.
To grow big you must map and develop your business in the 4 metrics
framework
If you have not done it before do it now!
SCOPETIMEQUALITY COST
Once you have mapped your present position in the 4 Metrics frame work
Write ToUs For the next steps ahead
Author ProfileI have over 20 years of experience in manufacturing and consultancy in the energy and knowledge management sectors . Besides I am an author , a freelance journalist and international business consultant. Follow me at www.twitter.com/ecothrust or read my writings at
CleanBiz Asia HK
Economic Times New Delhi
ISEdb Ohio
NewsCollective Stockholm/Mumbai
Suite 101 Vancouver
Technorati San Francisco
My column What Happens If ? In Economic Times & www.ecothrust.blogspot.com
References: Page 1 to 7 of The Project Management Time Cycle ISBN 1440493332The Project Management Time Cycle – Vol. I From Concept To Feasibility 0493332)Our Blog : Economy to Ecology: Our goal is to help promote clean, safe and better practices in economy and ecology worldwide. Balanced, efficient and a little more sustainable. Kindle Blog Ecothrust ASIN: B0029ZAUAY For non kindle users : www.ecothrust.blogspot.com
Our Blog at Economic Times on Risk Management : What happens If http://blogs.economictimes.indiatimes.com/Whathappensif/entry/can-nuclear-risk-mitigation-be
Follow me at twitter : www.twitter.com/ecothrust Acknowledgements:To Google, flickr photolibrary and other image sources.
For any queries or questions, mail to Sandip Sen [email protected]
Other presentations by usBusiness Risk management Series
http://www.slideshare.net/SandipSen/living-dangerously-managing-risks-in-business-ba01ppt
Business Risk Case Studies Ba31http://www.slideshare.net/SandipSen/business-risk-case-study-ba31
Business Risk Case Studies Ba32http://www.slideshare.net/SandipSen/business-risk-case-study-ba-32-1751378
Business Risk Case Study – Ba 33 http://www.slideshare.net/SandipSen/business-risk-case-study-ba33
Risk Managing Oil Explorations ERM 03 http://www.slideshare.net/SandipSen/cfakepathrisk-managing-oil-explorations-erm-03
.
What is Carbon ?
Energy Risk Management Series ERM 01
Energy Risk Management Series ERM 01
What is Carbon – ERM-01 http://bit.ly/bjDTl2
Countering Peak Oil – ERM-02 http://www.slideshare.net/
SandipSen/countering-peak-oil-erm-02
Risk Managing Turbulent Markets BA 41http://www.slideshare.net/SandipSen/risk-managing-volatile-markets
Will Arab Youth Revolt Turn Global :
7 Metrics of Revolt
Asia’s Rainy Day Economics BA 41http://www.slideshare.net/SandipSen/asias-rainy-day-economics-currency-wars-and-market-volatility