Archive

Archive for the ‘History’ Category

Good customer, bad customer, how to find the ideal ones

March 2nd, 2011 No comments

When a startup or an entrepreneur looks for customers, for the most part they look for ANY customer just to bring in revenue. Any customer that pays the bills is a customer that a new startup company wants. It’s all about generating sales, revenue, and ultimately profit. But then again, there is always a good customer, bad customer approach to your customers, customers that are more difficult than the others and potentially more costly.

Using the Pareto principle, we’ll see how to analyze your customer base, to find which customers are your most expensive or profitable to maintain. The Pareto principle is normally referred to as the 80-20 rule. For example, 80% of your revenues come from your top 20% of your customers, or the richest 20% of Americans pay 80% of the federal tax bill, or fixing the top 20% of software bugs that cause 80% of software crashes.

The Pareto principle is a tool to analyze data to find the sources of a problem and to determine the priority of resources to apply to the problem. Asking the right question is the start of good Pareto analysis.

In our example to the left, customers A-G shows a transaction count and you can see using the Pareto principle you see that almost 80 percent of the number of transactions come from customers A-D. But this also begs the question for more information: How much is the average sales per transaction and how much time to service your customer are additional data that needs to be examined? How much can you reduce your time and effort in handling a less than ideal customer? Is there something within your operational capability that can change your customer dynamics? Your first choice, in most cases, is to look inside your business data to find answers.

The next question is how much time and effort does it take to service your top 20%? Generally whenever you are looking at your customer base your worst customers probably will be in the bottom 80%. But not so fast, customer revenue is only one factor in determining business profitability, a customer’s expense, the time and effort it takes to service one, is equally as important. So it is the combination of both revenue and expense that will determine the Pareto principle used in analyzing your customer base and finding other solutions for your less than ideal customers.

No one wants to lose a customer or have to let one go to a competitor, but it is about being profitable as a business.

Once you have done the analysis, now is the delicate balance on how to handle a less than ideal customer.  And that is for another blog post.

Categories: 7 Sales, 8 Operations, 9 Finance, History, Tips Tags:

Just finished this book: Titan: Life of John D. Rockefeller

February 17th, 2011 No comments

Titan: The Life of John D. Rockefeller, Sr.Titan: The Life of John D. Rockefeller, Sr. by Ron Chernow

My rating: 5 of 5 stars

A great biography about Rockefeller, not only about, but our US history, dealing with the amount of wealth he had, and how people viewed him. Could not put it down from all of the things I learned from it.

View all my reviews

Enhanced by Zemanta
Categories: Book, Business, Entrepreneur, History, Writing Tags:

Talent and opportunities abound, keep your eyes and ears open.

January 10th, 2011 No comments

Startup entrepreneurs look for opportunities to make some money, but what you do not want to miss is the talent that is around you. As I write this on Wednesday, January 5th, 2011 at 1:15PM MST this YouTube video about homeless radio announcer Ted Williams has gone viral with over 5.4 MILLION views in less than 2 days!!

Getting laser focused as an entrepreneur means you concentrate on what’s important to your goals. But too often our laser focus means we miss out on things that are happening in the periphery. You’ve heard of the saying, “Stop and smell the roses” haven’t you? Well, stop and look around to what’s happening around you. You just might catch an opportunity to make a new customer or find a new talent that can help you in your business.

From my Jewish and Christian friends, here’s the idea about Ted Williams. Read Leviticus 19: 9-10:

9 ‘Now when you reap the harvest of your land, you shall not reap to the very corners of your field, nor shall you gather the gleanings of your harvest. 10 Nor shall you glean your vineyard, nor shall you gather the fallen fruit of your vineyard; you shall leave them for the needy and for the stranger. I am the LORD your God.”

What it states here is to leave some of your harvest for the needy. But notice that it does not say GIVE them the food, but allow them to WORK for it, allowing them to have some self respect and to overcome their struggle. Giving them a hand out  might help them for the moment, but it’s important for their self respect and motivation to earn their keep. It’s up to us to give them that opportunity, however small. It is NOT for you to take advantage of someone’s plight and abuse their situation either.

Ted Williams is a human being, treat him as such.

Never give up and never stop looking. And most of all, never count out someone who is willing to help themselves and is looking to fish for themselves if just given a fishing pole. Seems like Ted Williams has gotten a job within 48 hours of this video.

Good for him and Godspeed in his journey.

Thanksgiving: The real story of the Pilgrims and our national holiday

November 25th, 2010 No comments

As startup entrepreneurs we need to take a day of rest to be thankful and grateful to have what we have, but did you know that the Pilgrims and their business investors actually caused the Pilgrims suffering, mostly it was the Pilgrim’s issue? What was the reason for their thanksgiving and what was the cause?

Pilgrims Life and Thanksgiving. The Pilgrims landed in November 1620 with 101 people (about half died within months) and in 1621 had their first thanksgiving. While thanks were given as was the custom for these religious people, it was not a very successful year of food production. They were trained by the Indians how to grow food, albeit needing some time to get proficient at it. They were given land to grow the food on. They had houses to live in and clothes on their back sufficient to do the work. So why did they have to ration out their food and scrounge for more?

Because their first efforts at food production were defined as one of communal living, mostly called today as the redistribution of wealth. In this case wealth is being defined as the rewards of ones total efforts and talents applied to a particular task or endeavor. All of the Pilgrim’s production was one where the results were put into a storehouse for “the common good” and portioned out as was needed by each individual and family. However, this resulted in a bunch of “freeloaders” that would not or by way of trickery did not want to work and the Governor

found them in the streete at play, openly; some pitching the barr and some at stoole-ball, and shuch like sports. So he went to them, and tooke away their [play] implements, and tould them that was against his consciente, that they should play and others worke. Source: William Brandford, 173

Because of the communal aspects of their results, many did not want to work and some resorted to stealing from the storehouse, from the Indians, and from each other and in some cases rationing had to be instituted to keep them alive. However, a decision was made:

And so assigned to every family a parcell of land, according to the proportion of their number for that end, only for present use (but made no devission for inheritance), and ranged all boys and youth under some familie. This had very good success; for it made all hands very industrious, so as much more torne was planted then other waise would have bene by any means the Govr or any other could use, and saved him a great deall of trouble, and gave farr better contente. The women now wente willingly into the feild, and tooke their litle-ons with them to set torne, which before would aledg weaknes, and inabilitie; whom to have compelled would have bene thought great tiranie and oppression. William Brandford, 216

Now notice this key ingredient: communal or collectivist living is the taking of your wealth, via community acts and redistributing it among others. That’s far different than one deciding to give your wealth to others by your own volition or choice to whom you decide to give it to. It was when the Pilgrims switched from this communal living to private property, owning your own wealth, and then “taxes” being imposed that improvements were made in their overall economic situation, i.e. producing enough food to live and to make a living. Source: Pilgrims switching from communal living to private property. A historical primary source is William Bradford, the second governor of the Pilgrims, and his history writings, Of Plymouth Plantation.

In 1622 that’s when the real Thanksgiving bountiful harvest was recognized.

President George Washington’s Thanksgiving Proclamation. As President, on October 3, 1789, George Washington made the following proclamation and created the first Thanksgiving Day designated by the national government of the United States of America:

Whereas it is the duty of all Nations to acknowledge the providence of Almighty God, to obey his will, to be grateful for his benefits, and humbly to implore his protection and favor, and whereas both Houses of Congress have by their joint Committee requested me “to recommend to the People of the United States a day of public thanksgiving and prayer to be observed by acknowledging with grateful hearts the many signal favors of Almighty God especially by affording them an opportunity peaceably to establish a form of government for their safety and happiness.

Now therefore I do recommend and assign Thursday the 26th day of November next to be devoted by the People of these States to the service of that great and glorious Being, who is the beneficent Author of all the good that was, that is, or that will be. That we may then all unite in rendering unto him our sincere and humble thanks, for his kind care and protection of the People of this Country previous to their becoming a Nation, for the signal and manifold mercies, and the favorable interpositions of his providence, which we experienced in the course and conclusion of the late war, for the great degree of tranquility, union, and plenty, which we have since enjoyed, for the peaceable and rational manner, in which we have been enabled to establish constitutions of government for our safety and happiness, and particularly the national One now lately instituted, for the civil and religious liberty with which we are blessed; and the means we have of acquiring and diffusing useful knowledge; and in general for all the great and various favors which he hath been pleased to confer upon us.

And also that we may then unite in most humbly offering our prayers and supplications to the great Lord and Ruler of Nations and beseech him to pardon our national and other transgressions, to enable us all, whether in public or private stations, to perform our several and relative duties properly and punctually, to render our national government a blessing to all the people, by constantly being a Government of wise, just, and constitutional laws, discreetly and faithfully executed and obeyed, to protect and guide all Sovereigns and Nations (especially such as have shown kindness unto us) and to bless them with good government, peace, and concord. To promote the knowledge and practice of true religion and virtue, and the encrease of science among them and Us, and generally to grant unto all Mankind such a degree of temporal prosperity as he alone knows to be best.

Given under my hand at the City of New York the third day of October in the year of our Lord 1789.

National Thanksgiving Celebrations. Who set aside this day of Thanksgiving? President Lincoln. He was the first president to announce and set aside a national day of thanksgiving for everyone in America, here is his Proclamation of Thanksgiving.

So, our Thanksgiving should be not only for the food and blessings we have received, but also the lessons learned as to how to keep the food and blessings flowing.

From the Jewish and Christian Bible: ”Enter His gates with thanksgiving, and His courts with praise. Give thanks to Him and praise His name. For the LORD is good and His love endures forever; His faithfulness continues through all generations.” (Psalm 100:4-5)

Sources:

WikiPedia link about Thanksgiving.

First recorded histories of thanksgiving.

Life lessons from an American Cherokee Indian

November 19th, 2010 No comments

An elder cherokee was teaching his grandchildren about life. He said to them, “A fight is going on inside me. It is a terrible fight and it is between two wolves.

One wolf represents fear, anger, envy, sorrow, regret, greed, arrogance, self-pity, guilt, resentment, inferiority, lies, false pride, superiority, and ego.

The other stands for joy, peace, love, hope, sharing, serenity, humility, kindness, benevolence, friendship, empathy, generosity, truth, compassion, and faith.

This same fight is going on inside you, and inside every other person, too.”

The children thought about it for a minute and then one child asked his grandfather, “Which wolf will win?”

The old cherokee simply replied,”The one you feed.”

And you can apply it to those that you deal with as well. How?

Feed only the good wolf of any family, friend, or neighbor that you come in contact with and not their bad wolf.

Veterans Day: What does it mean to be a Vet?

November 11th, 2010 No comments

A “Veteran” — whether active duty, discharged, retired, or reserve — is someone who, at one point in his life, wrote a blank check made payable to “The United States of America,” for an amount of “up to, and including his life.” (author unknown)

How did Veterans Day start? Here’s a link to how it came about.

It is the Soldier, not the minister
Who has given us freedom of religion.
It is the Soldier, not the reporter
Who has given us freedom of the press.
It is the Soldier, not the poet
Who has given us freedom of speech.
It is the Soldier, not the campus organizer
Who has given us freedom to protest.
It is the Soldier, not the lawyer
Who has given us the right to a fair trial.
It is the Soldier, not the politician
Who has given us the right to vote.
It is the Soldier who salutes the flag,
Who serves beneath the flag,
And whose coffin is draped by the flag,
Who allows the protester to burn the flag.

Charles Michael Province, U.S. Army

Copyright Charles M. Province, 1970, 2005.
All rights reserved.

God bless our veterans!

Categories: History Tags: ,

The 3+2 Rs of school and education: Readin’, ritin’, ‘rithmetic, and …

November 5th, 2010 No comments

When you’re a kid, you go to school to learn the basics, the three R’s, reading, writing, and ‘rithmetic. But what is just as important in these three is adding two more Rs: Responsibility and Revenue. What do I mean? Let’s discuss this.

Responsibility. In this case, it means that kids should be taught taking responsibility:

  • for themselves first,
  • then for others second, which includes both determining the proper role of business and their local, state, and federal government in a society and the role of each individual’s involvement in the process to ensure a civil society.

I have used this illustration many times before, but it bears repeating:

Individual responsibility means taking care of yourself first, then helping others.

Just like you hear when flying in an airline that if the aircraft’s cabin depressurizes that you are to put on the oxygen mask on yourself first, then help others, so goes with being here on the ground, helping ourselves first and then others in our society.

Revenue. For this term I mean how to handle money in general, but with first staring with knowing how to handle:

  • personal finances,
  • how working for others affects money,
  • having their own business to earn their own money,
  • and lastly how the government and taxes affect each of the above perspectives of money.

This last part, revenue, is the last part that needs the most attention in our schools. Since parents may not be telling kids about finance, schools need to integrate that into the curriculum.

Kids Survey. According to the Kauffman Foundation‘s “Fact Sheet on 2007 Youth Interest in Entrepreneurship Survey,” those who want to have their own business say their top reasons are:

  1. to use their skills and abilities (92 percent),
  2. build something for their future (89 percent),
  3. be their own boss (87 percent),
  4. see their ideas realized (81 percent)
  5. and earn lots of money (85 percent).

Here are some links to further

The Daily Infographic “Who are the Entrepreneurs?” gives some insights into who the entrepreneurs are.

What information and sites do you recommend?

Switch to our mobile site