So You Want to Be #1… at What?
Here in the United States, it seems to be so important for us to be #1.
Most of our politicians constantly want us to fix this or that so we can “be #1 again.”
But exactly what is it we want to be the best at? More importantly, is what we think we want to be #1 at is really best for us?
For example, here in the US our current measurements for success are essentially the GDP (Gross Domestic Product) and stock prices.
These measurements for success are flawed at best, and downright dangerous at worst.
GDP basically measures our economic success based on how much product we sell. If we sell more “stuff” from the previous period, our economy is “growing”. If we sell less, our economy is “in trouble”.
Hardly a sustainable business model!
Monitoring the stock market to see if stocks are going up in price or down is the other tool. This has little, if anything to do with how the companies listed on the stock exchanges are actually doing as a company.
Many of the stock prices fluctuate based on things completely out of the businesses’ control. Like investors’ mood swings on the economy, or a natural disaster in another part of the world.
“As a country [United States], we have consistently relied on indicators that keep us focused on the interests of business, financial institutions or the defense industry whereas equity, quality of life and even social mobility metrics are played down.” David Rothkopf, The New York Times’ Sunday Review, October 9th 2011.
As a result to this, our corporations and financial institutions (i.e. Wall Street) become more influential than they should.
Hence the turmoil with all the #Occupy demonstrations.
Newsweek recently published an extensive research on the World’s Best Countries, based on each country’s Health, Education, Quality of Life, Economics and Political environments.
Overall, the US ranked #11.
Not even close to #1!
In fact those countries who’ve ranked higher than the US, primarily northern European countries along with Japan and Canada, focus on a different definition of success, like “quality of life” instead of GDP and stock prices.
We achieve the wrong goals when we set the wrong definition of success.
How about you? What do you want your company to be #1 at:
- Gross Sales?—how much you sell every year. Are sales increasing or decreasing?
- Net Profit?—at the end of the day, do you have more in your pocket or less?
- Branding?—do you outshine your compeition?
- Customer Loyalty?—are you retaining your current customers or constantly relying on new ones?
- Impact on the planet—what is the impact you have on your surroundings?
- Happiness—of your employees, communities, vendors, and lenders towards your company? Most importantly, how happy are YOU ?
We entrepreneurs usually focus on financial performance as our key metric for success.
Understandable, for sure!
But at what costs? Cost of your time and health? Your stakeholder’s health? The environment’s health?
I learned this one the hard way when in the ‘90’s I took one of my companies into bankruptcy by expanding before we knew why we were profitable. I lost millions of dollars and let down many employees, vendors, investors and customers.
Be clear on your metrics.
Making sure you use the correct measurements of success. Why they are important to you and your company.
Lastly, being #2 or #3 is not so bad!
- avoid the mistakes as the current #1—remember MySpace?
- reinvent yourself if you slip from #1 slot
- use the momentum of the #1 business to position yours (i.e. if you’re a lighting store, open up next to a WalMart and sell everything they don’t sell!)
While not being #1 is a good thing, striving to be is.
So, I think it really is OK for the United States to not be #1. It allows us the freedom to reinvent ourselves. It allows us the permission to not feel compelled to police other nations.
And it allows us to focus on building the right measurements for success.
Action Steps for the Week
What are you striving towards? You want to be #1? If “yes”, good. Exactly at what, though? Make sure it’s specific and measurable.
Start with your vision. Be clear on where your company is going.
For example, how much capital, financing, revenue growth do you really want? How big do you want to grow? And why?
Then create metrics to measure this. Clear milestones along the way.
And if you get stuck or want a sounding board, you know where to find me!