Success is no accident.

Let's say you pick 100 people at random. How many of thosepeople do you think could bake a great chocolate cake?A few? Many? Most?

Wouldn't you say success depends on whether they have agood recipe? Without a recipe, most people would not be ableto bake a chocolate cake!

"94% of failure is due to lack of a proven system."

A good recipe is a proven system that "works" every singletime. Obviously, the cook does the actual work.

Can you develop a recipe for success in business?

Here's the problem (I mean, challenge): 95% of allbusinesses fail within 10 years of start up. The primarycause is management incompetence. The solution is formanagement to build success into the business by developinga "recipe" to make the business work.

In round numbers, let me show you the business failurestatistics.

40% fail in the first year80% fail within 5 years95% of all new businesses fail within 10 years

Still, small business is, and always has been, the backboneof our US economy.

Today, about 33 million (1 in 4) Americans run solopractices or micro-businesses with a max of 9 employees.

Further, mill'ions of other small businesses employ tenor more people.

Surprisingly, small businesses employ MOST of the workforce,create MOST of the new jobs, and produce MOST of the privategross domestic product (GDP).

Hard to believe, right? Typically, we hear about BIGbusiness in the "news"!

Why do most business fail?

Compelling research shows repeatedly: "managementincompetence."

Many people who start businesses make this fatal assumption:

"I am an expert in doing the technical work of abusiness. Therefore, I will be an expert in managinga business that does the technical work."

However, knowing the technical work of the business becomesthe new entrepreneur's biggest liability! Why? Because mostentrepreneurs snap right back into doing the technical work(tactics) and forget about strategy (as I discussed in lastweek's PVT).

They get so busy baking chocolate cakes that theyforget to build the company, innovate, and watch themarket. They forget the BIG IDEA, and theirEntrepreneurial Dream turns into a technical nightmare!

Doing the technical work of a business is way different thanmanaging the business of doing the technical work! Forexample, I have seen very few great salesmen make goodsal'es managers.

14.3 million more business failures?

Economic forecasts predict that self-employed people willincrease by up to 50% by 2010. Why? Corporate downsizingand human desire for independence.

But, more people going into business means even morebusiness failures.

If 95% fail within the first 10 years, and if15 million more people start businesses by 2010,about 14.3 million more business will fail by 2020!

(Now there's an opportun'ity if I ever saw one!)

Most businesses fail because they fail to use a provensystem. Conversely, most businesses that use a proven systemsucceed.

Whether you're an employee or an owner, will your businessbe the 1 in 20 that survives?

The way for a company to survive is to create a system, a"recipe," for making the business work.

But wait! A recipe is more than ingredients. A good recipeincludes the right process!

"If you can't describe what you are doing as a process,you don't know what you're doing."W. Edwards Deming (1900 - 1993)

Here is an overview of the basic 7-step process (actually aloop) that I discussed in PVT 5. Let's review:

1. Assess current conditions (what does incomingcommunications tell you n0w?)

2. Communicate your intentions (promote your purposesand delegate downward)

3. Organize resources for producing your product

4. Produce your product

5. Qualify your product (does it pass muster?)

6. Distribute (deliver) your product

7. (Return to step 1.)

People make a big mistake starting in Step 4. They thinkthat their product is the COMMODITY (chocolate cake).

Thus, they omit the most important products that makelong-term success possible. The most importantproducts are their proprietary recipes and processes- and the company itself!

These products must be developed refined, proven, andkept up-to-date. (Unfortunately, most people don'trealize the company is a product.)

To achieve this, you must include your proprietary recipesand processes - and the company itself in all 7 steps! Ifyou don't, your focus will remain on the COMMODITY and thetechnical work. And you can kiss your Entrepreneurial Dreamgoodbye!

My critical message is this:

According to research, most businesses fail becauseof "management incompetence" and the solution is formanagement to build success into your businessprocesses.

If what I've said is true for a business, what is true forindividual employees? I will discuss that issue in nextweek's PVT. Don't miss it!

Success is no accident. Success leaves clues. You can createsuccess on purpose.

You decide.

What did you learn today that you found most beneficial?How will you apply what you have learned at work?Comments are welcome. mailto:Mike@SeniorManagementServices.com

Until next week...

Best Regards,

Mike Hayden, Principal/ConsultantYour partner in streamlining business.

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