Business Articles - "How To" | The Word Man | John Suddath

So You Want to Go Into Business

Fri, 15 Sep 2006 16:10:11 -0400

The Triangle is a very good area in which to start a new business because of the booming economy, the support of business and educational institutions, and the increasing influx of venture capital. Although the majority of publicity has focused on the high tech companies around the Research Triangle Park, many other opportunities abound. For general business advice, start with the Small Business Centers at Durham Tech and Wake Tech, one of the 11 Small Business & Technology Development Centers of UNC, the Senior Corps of Retired Executives (SCORE), and the area chambers of commerce. For specific business requirements, start with the NC Business License Information Office in downtown Raleigh, and they can direct you to other government offices such as the County Registry of Deeds, NC Revenue Dept., NC Secretary of State, as well as local communities. A number of licenses and fees are required even for sole proprietors providing professional services.

Why do you want to start a business? Do you have a great idea that you know the world is just waiting for? Better do a little market research and testing first. Are you bored in retirement and your spouse is tired of having you sitting around the house? That's not much motivation for sustaining a business just to avoid inactivity. Perhaps you should consider volunteering or taking up a new hobby. Have you always wanted to be your own boss with no one to tell you what to do? You'll have dozens of bosses, including your customers, vendors, suppliers, and shareholders. Will you offer something unique and can you prove it?
First, you have to have a business plan. A plan is more than just a financial outline and a list of goal and objectives for the proposed company. It is a process of organizing and committing your thoughts and ideas not only to paper but also to practice. It doesn't have to been a long, detailed document based on extensive research, but you better have the basic facts straight and based on something more than just a hunch. Every bookstore has a shelf on business plans, and a number of books on starting a new business are available at the public library. It's worth your time to read a couple, but don't take them as a cookbook of how to develop your business. Computer software applications also are available that provide templates of the basic parts of a business plan. They can be helpful if you have no idea where to start or just aren't a very organized person and need structure.
Just because you're retired and "have the time" to mess around with those ideas you kept putting aside for years doesn't mean that you should consider going into business. Your entreprenurial urge may be the spark, but you will need sustained effort, time, and money to keep the flame going. The second thing is capital, more commonly known as other peoples' money. Double what you think you'll need, and it will about fit. There are other options in addition to bank financing, and you don't have to give up control just to get a few investors. But they will demand financial discipline, a documented financial statement, and realistic sales projections. Whether or not to take in partners, solicit funds from family members, to incorporate or not, are all controversial decisions that you must face as part of planning process.
One practical consideration is to create an informal board of directors, that is a group of advisors, who can fill in some of the gaps where you are weak and also serve as a sounding board in brainstorming ideas. Will you have employees? That adds another level of complexity in forming a business, particularly in the areas of taxes, employment policies and regulations, and compensation. Once you have one other employee, you've got to get everything in writing and you have to budget for those administrative and accounting costs. The cliche that you should find a need and fill it has historical precedence, but you also need focus, perseverance, and enthusiasm. If you're lacking any of the three, reconsider whether or not you're really ready to get into business. No matter how great your idea, product, or service, it will take more to sustain a fledgling business.
The basic concepts of business are well defined, and many companies and schools offer educational opportunities to learn the basics. You may not need a MBA, but you or your partners must master the basics. You've got a lot of factors to consider, and it's easier to do it before you open the doors than when you're facing a crisis. A realistic self-appraisal of your skills and weaknesses, an overview of your market and your place in it, and consideration of the proper timing are more than academic exercises. So you've considered all these issues and decided that you still want to go into business. Good luck and enjoy being an entrepreneur!
John Suddath is the owner of The Word Man, a marketing consulting firm, and may be reached at jsuddath@earthlink.net, via his web site at http://www.johnsuddath.com, or (919) 785-1516 in Raleigh.

Ten Tips on Being a Successful Project Manager

Thu, 14 Sep 2006 17:20:10 -0400

1. Put People before Process – Even a manufacturing operation isn’t a purely mechanical process, but the desire to quantify or measure activities often leads to the temptation to overlook the human element. People control and influence processes based on many internal, external, and cultural factors emanating both from within and outside the organization. Some are uncomfortable in dealing with the “touchy feely stuff”, but the interactions within your group ultimately will determine your success or failure.

2. Planning is an evolving process, not a rigid guideline – Preparation, commitment, goal-setting, budgeting, scheduling, and establishing priorities get you off to the right start but don’t guarantee that you’ll reach the goal. Flexibility, adaptability, and assessing risks are part of the process of monitoring the progress of a project. Don’t be afraid to say “whoa!”

3. Measurement validity depends on getting real data, not just collecting numbers – The usual cost containment mindset is to monitor “budget versus actual” figures as though the budget was set in stone. Quantifying data means more than just collecting time sheets and writing weekly reports. Operational data has to be collected at the individual level and then compiled into meaningful and usable summary data which can be easily interpreted. Don’t get wrapped up in the structure of maintaining a schedule or monitoring a grand “to do” list.

4. Accountability has to be related to authority, performance and rewards – at both the individual and group level. These variables are interrelated and can’t be proscribed in isolation. Dictating goals from the top down or artificially imposing team goals overlooks the opportunity for ideas to evolve from the ground up.

5. Achievement must be linked to incentives and to rewards – Offering bonuses or threatening dismissal are too extreme to be useful controls in motivating people within the usual boundaries of a fixed length project. The more innovative companies also aren’t averse to risking failure knowing that such openness offers the potential for great rewards. Don’t wait for the completion to offer rewards or rebukes.

6. Management by exception – is merely an institutionalization of the adage that the squeaking wheel gets the grease. The real problem may not be obvious; in fact it may be hidden under a blanket of minutiae and only appear when a crisis is reached. Look for the under currents, engineers called it critical path; in other words distinguish what is important and what is not.

7. Meetings, reports, team playing, and the corporate culture – Good communications are essential both up and down the line. “Management by walking around” achieved some notoriety as a method of top management keeping in touch with workers. Consistency is more important than whether the communication channels are structured or informal. If you say one thing and do another, that communicates a lack of commitment or a conscious duplicity.

8. Strategic goals, business outcomes, priorities, and trade-offs are just different ways of describing what gives direction and momentum to a project. Top management may be totally committed to a project but dead wrong, which may become apparent as the project moves along.

9. Assessing risks versus benefits – Critical judgement involves a lot of input as well as analytical thinking. Not every idea or every individual is equal or valid, and brainstorming has its limits. Risk management involves an entire segment of the insurance industry, but there are financial as well as safety risks. And the risk of lost opportunities is perhaps the most insidious of all.

10. Learn how to define success and failure – So you came in under budget, on time, and achieved all your goals. The customer must be happy, right? Your contract will be renewed? Often research projects end with the call for more research, ergo more grant money. Did your project come to closure or just move the organization along a few steps? How does the perspective of hindsight change the view that you had at the beginning?

John Suddath is a transplanted Texan who after several contracts with some of the alphabet soup of agencies and associations in Washington concluded that the business climate of the Triangle is a more rational environment than the buzzwords of bureaucrats. A survivor of a long-term reinventing government project, John also is known as the Word Man. Phone: 919-785-1516. Email: jsuddath@earthlink.net