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They say a typical entrepreneur fails five times on average before succeeding. That makes me a below-average entrepreneur since my business hasn’t failed — so far, anyway.
Andy Grove, former CEO of Intel, was known for his "paranoia." He never discounted the possibility that Intel would fail. He excised a huge chunk of Intel’s business where he saw failure approaching (memory chips) and focused on microprocessors, where he saw the real opportunity. Many entrepreneurs are like Grove — realist optimists, who live a dual life of anxiety over possible failure and deep optimism they can find a way to succeed.
The opposite of a realist optimist is the "not today" optimist. Many powerful corporate chiefs believe change is coming, but not today. As a result, their sense of urgency is muted by default, and worse, they are less likely to listen to different perspectives.
However, if you have recently graduated, there’s a good chance you have some fabulous ideas on how to make a business more successful as the market changes in fundamental ways.
Expect rejection. Yeah, yeah, change is coming, but not today.
It’s actually understandable. Large, successful companies believe their economies of scale or network externalities will fend off any challenge. The first refers to production or distribution or purchasing power due to size, and the second refers to Facebook.
They are dead wrong. Consider this example: German automakers are world-renown for their leadership in performance. Mercedes, VW Group (which includes Audi) and BMW are unrivaled for their reputation in internal combustion engines (ICE). Their combined sales in 2017 were around half a trillion Euros. Read this again: EU 500,000,000,000. Yet their market capitalization — the value of their shares as voted by millions of investors, analysts and institutions, is a puny $190 billion combined.
It’s not that these tech companies can produce better cars than the German automakers. Google hasn’t produced one car yet, and Tesla has plenty of problems. But in the likely case autonomous vehicles become popular, who cares about their brands? Do you choose a car service based on the car that comes to pick you up? Would riders have anything to say about which cars autonomous-ride companies lease for their fleets?
The possible decline of brand power in the performance cars’ market is combined with the real possibility that the internal combustion engine (ICE) will be replaced by more eco-friendly engines. The German venerable reputation in ICE is not extended to other engines.
It’s not that the executives at the German car companies are completely blind to the enormous change. But, in their heart of hearts they think, not today. They do pay some lip service to the change: They are all chasing what they call "talent." But, this talent — young mavericks, some right out of school, just don’t fit the culture. They don’t want to work in Detroit or Wolsfburg. The old-school engineers in control of the car industry are not their cup of tea (and vice versa). At the end, the German car companies might face the same fate as Packard (no, not Hewlett-Packard). Do you know Packard?
Your first job might be at a big, culture-heavy company that employs millions. If so, what are your options? You are a newbie, your ideas are discounted because you are a newbie, and the implicit message that you should shut up and do as you are told. Maybe you can gain some credibility in 10 to 15 years. Corporations are not a democracy, and your vote is not equal.
If you listen to conventional advice, you learn to become a good team player, assemble slides full of data to confirm your bosses’ perspective and reserve your perspective to yourself. But what if one day, in the elevator, you run into the feared SVP and say, with reverence and respect, "I think our strategy in sector X is ignoring some big changes in the market."
You may be asked to leave the elevator mid floor. You may also jumpstart your career. If you don’t take risks, you will never know.
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March 5, 2019 at 01:44PM