Tag Archive for 'Blasingame'

Are you asking the Outsourcing Power Question?

Biutou Doumbia lives in a tiny village in Mali, in western Africa. She and her family live in poverty, very close to the line between survival and, well, you know.

Oh, one more thing: Biutou is a small business owner. She makes and sells peanut butter.

In Mali, as reported in a Wall Street Journal article, peanut butter is made the same way African women have made other staples for millennia: by grinding the seeds on a rock with a wooden pestle. You might say Biutou’s operation is vertically integrated: She grows the peanuts, then manufactures, sells and distributes her product.

Over two centuries ago, in The Wealth of Nations, Adam Smith explained how markets are made by the division of labor. And free markets created capitalism, which Ayn Rand called, “the only system geared to the life of a rational being.”

Biutou doesn’t know Smith or Rand from a warthog – she’s illiterate. But she is one of Rand’s rational beings. And as such, she recognized the division-of-labor efficiencies offered by a diesel-powered grinder/blender when it became available. Now for 25¢ and a 10-minute wait, the sack of peanuts Biutou carries to the central grinding location turn into better peanut butter than she could make pounding all day with a pestle.

So Biutou now practices outsourcing, a division of labor process which is the employment of contractors to create efficiencies. Outsourcing is a valid business strategy, as is its opposite – you guessed it – insourcing, the process of removing vendor layers, usually to get closer to customers.

These two strategies are as different as chocolate and vanilla; but, like ice cream, choosing one doesn’t mean the other is wrong, just different. When Biutou practiced insourcing she didn’t have a choice. You have many choices; but are you choosing wisely?

One of the things every 21st century small business must do is focus on core competencies: what you do that makes your business valuable to customers. Everything else, theoretically, can be performed by a specialist in your non-core activity.

Take a look at your own operation to see if – like Biutou – you can find efficiencies and recover time through outsourcing. Ask yourself and your staff Blasingame’s Outsourcing Power Question: Must this task be done in-house? The answer will come from these three questions:

• How much control do we lose, and can we live with it?
• What impact will our decision have on customers?
• How much of not using outsourcing is about ego?

Remember, any decision to employ outsourcing – or not – should be driven by the desire to seek efficiencies and improve customer service.

Write this on a rock … Blasingame’s Outsourcing Power Question: Must this task be done in-house?

Small business owners have the right stuff

One of my favorite books is The Words Lincoln Lived By, by our good friend and Brain Trust member, Gene Griessman. That’s where I found this Lincoln quote about tenacity:

“I expect to maintain this contest until successful, or till I die, or am conquered, or my term expires, or Congress or the country forsakes me.”

Sound familiar? If you are a small business owner, I bet it sounds very familiar. It might even give you a little chill when you read those 140-year-old words. you know, hearing the essence of your being translated into the spoken word in a way in which you may never have actually spoken it out loud.

As an Army officer I was taught to be responsible for everything my unit did or failed to do. In small buisness, and you’ve heard me say this before, “You turn the lights on, you turn the lights off. Whatever it takes.”

Tenacity. I sure do like that word, and I admire tenacious people. Are you tenacious? The tenacious have the courage of their convictions. Courage, period. Passion. A strong spirit. Maybe even an indomitable spirit.

If you are a small business owner you know how far down inside of you that you have to reach to rise above all of the challenges, train wrecks and surprises that are thrown at you. Sometimes deeper than you knew you could. Testing your mettle. I don’t care what anybody says, astronauts are heroes, but they don’t own the franchise on “the right stuff.” Small business owners have it, too.

I am so proud of you.

Dispelling the myths of ownership

As the economy recovers, you’re likely to meet a starry-eyed human babbling on about becoming a business owner.

Probing for the object of this person’s entrepreneurial infatuation will precipitate the what, where, how and when questions and, finally, the most important question: Why do you want to own a business? Answers to this last question, unfortunately, often produce what I call, “The Myths of Small Business Ownership.” Here are four:

Myth 1: When I’m an owner, I’ll be my own boss.
That’s right; you won’t have an employer telling you what to do. But you’ll trade that one boss for many others: customers, landlords, bankers, the IRS, regulators, even employees.

Modern management is less “bossing” and more leading, managing and partnering. In a small business, everyone must wear several hats and the dominator management model doesn’t work well in this modern multi-tasking environment.

Myth 2: When I own my own business I won’t have to work as hard as I do now.
This is actually true, you will work much harder. Ramona Arnett, CEO of Ramona Enterprises, said it best: “Owning a business means working 80 hours a week so you can avoid working 40 hours for someone else.”

The irony is you will actually want to work harder when you understand that everything in your business belongs to you. Even the irritating, frustrating and frightening challenges will take on a new perspective when you realize that you also own the opportunities you turn them into. You’ll turn the lights on in the morning and off in the evening not because you want to work more, but because you won’t want to miss any part of your entrepreneurial dream coming true.

Myth 3: When I own my own business I can take a day off whenever I want.
Well, maybe. However, you may find that your business has such a compelling attraction that you won’t want to take off. Indeed, it’s more likely that whatever interests you had as an employee will become jealous of your business.

Myth 4: When I own my own business, I’ll make a lot of money.
If the only reason you want to own a business is to get rich, you probably won’t be a happy owner. It’s true ¬ you actually could get rich. But it’s more likely that you’ll just make a living.

Being a successful business owner first means loving what you do. Pursuing wealth should be secondary and, ironically, is actually more likely to happen when in this subordinate role.

Find a higher level of happiness

Did you know that there is actually a level of happiness, higher than your garden variety happiness, that can be attained by knowing that you are happy, and knowing why you are happy? Consider this quote from Henry Miller,

“It is good to be happy; it’s a little better to know that you’re happy; but to understand that you’re happy and know why and how … and still be happy, be happy in the being and the knowing, well that is beyond happiness, that is bliss.”

I like that thought, but reading it made me coin a new term: happiness-squared, or H2 for short. I like that better than bliss. Bliss is such a presumptuous word, don’t you think?

Here’s the question: What makes you happy? No, really. Think about it this time. Close your eyes, take two deep breaths and think about what is most important in your life; because that is where your happiness comes from. Might be children, work, creating, faith, things like that. Not money. Not stuff. If money and stuff are what you think makes you happy, I propose that you aren’t really happy.

Here’s the challenge: Work hard, create, build, yeah, make money, too. But don’t forget where real happiness comes from. Work on attaining some of the H2.

On The Small Business Advocate Show I’ve talked with two of my Brain Trust members, Jim Ballard and Jim Donovan, on how to be in charge of your own happiness. Jim Ballard is a management consultant, leadership trainer, motivational speaker, consulting partner with the Ken Blanchard Companies, and author of What’s the Rush? and Whale Done. Jim Donovan is an international bestselling author whose books include Handbook to a Happier Life and This is Your Life, Not a Dress Rehearsal, and his latest Don’t Let an Old Person Move Into Your Body. Take a few minutes to click on one of our discussions below and leave your thoughts on what makes you happy.

The paradox of happiness with Jim Ballard

Are you able to be happy with what you have? with Jim Donovan

Are you taking charge of your own happiness? with Jim Donovan




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