POET is a leader in first generation of ethanol production and has launched Project Liberty, for developing second generation cellulosic ethanol using corn cobs.

Project Liberty is a $200 million plant being built in Emmetsburg, Iowa, for which POET received an $80 million grant from the Department of Energy to build a cellulosic refinery.

What can we learn from the successes of POET Energy and CEO Jeff Broin?
What are the core principles that POET’s management team utilizes as the world’s #1 ethanol producer, while it remains standing - when other ethanol producers have closed their doors and gone bankrupt? 

While there are no silver bullets, and your business is different from everyone else’s, there are principles and tools developed by those who came before you that can guide you in taking smarter calculated risks. 

Applying the seven PROFITS Principles as a guide for how operate a business effectively, (from the newly released book, Run Your Business Like a Fortune 100: 7 Principles for Boosting PROFITS), you can learn how to use proven best management practices. 

Today’s column addresses three of the PROFITS Principles when applied to POET.

1. Position Only for Growth –
Profitable companies stay focused.  Though there may be several goals, these companies are like laser beams.  They maintain direction and strategic changes are planned, organized and financially assessed.

Clarity of vision
POET is clear about what it wants to accomplish – finding ways to be the most efficient ethanol producer and moving away from all fossil fuel inputs in its processes and plants. 
In 2007 The Energy Policy Act was updated.  There is an expectation that there will be 36 gallons of renewable fuel by 2022, with 21 billion gallons produced from cellulosic ethanol.  POET wants to produce what no other company has been able to produce, a true disruptive technology in the biofuels space.

Maintaining focus for the future
POET continuously finds ways to address the nation’s future needs ahead of its competitors.  In addition to Project Liberty and building the cellulosic ethanol refinery for the future, POET continues its strategic alliance with Novozymes, collaborating on the development of ethanol from cellulosic biomass. Forbes magazine named them both as renewable energy companies to watch.

Expansion focus
POET is always on the lookout for options to purchase production facilities for future growth.  In December they were rumored to purchase the bankrupt VeraSun Energy Corporation, the nation’s #2 ethanol producer.  So far, this has not occurred but speaks to POET’s focus on future growth.

2. Reality –
Operating a business within the current economic and political arena is a minefield for ethanol producers.  POET addresses these issues head-on.  These are some examples.

Facing the critical facts
Congress mandated that the EPA, in 2005, introduce renewable fuel into the nation’s energy supply and to increasing add to the supply each year. This legislation, The Energy Policy Act, resulted in the Renewable Fuel Standard, which required that 5 billion gallons of ethanol be added to the US supply of fuel within the year.  This legislation was updated in 2007 (see above).  POET participates actively in politics and legislation.

US move towards energy independence
POET explores sources for the raw ingredients for ethanol production.  One key way POET is doing this is by developing relationships with farmers – the people who have the resources (corn, corn cobs and corn stovers), by better understanding farmers’ needs and developing alliances with them.  POET does this in anticipation of future ethanol demand – which POET itself is helping to create.

Financial disruption in industry
POET is dealing prudently with its capital structure and financial situation.  Due to debt load and expansion, based on $2.00 bushel corn and upward costs of $7.00 for a barrel of oil in 2006, ethanol producers overextended themselves and now are out of business or facing bankruptcy. 
POET is not independent financially however.  It only owns minority stakes in the ethanol plants that it builds and operates.  This makes for a potentially precarious financial situation and POET is being cautious.
According to the New York Times on February 12, 2009: ‘gasoline consumption is declining even as federal mandates for ethanol are increasing.  The demand for ethanol and cellulosic ethanol may be insufficient.  Essentially it (ethanol) is costly to produce and there are technological hurdles to solve.  Although it can be done, very little, if any cellulosic ethanol is being produced on a commercial scale.’  Thus, POET has many challenges ahead.

Future based on current financial performance
POET is articulate about the current state of its business.  In every interview, management can speak specifically to the costs, acreage, logistics and costs of corn crops, fossil fuels and related expenses.  Company spokespeople demonstrate clarity about their financial performance and their areas of market strength and weakness.  They speak to what is required for POET to become more profitable.  For example, POET purchases corn in advance and uses affordable pilot testing for new projects.

3. Obtain Vital Information
An essential ingredient for a thriving business is obtaining vital information.  POET has a presence at all levels of government, listens to customers and stakeholders and strongly communicates its focus.

Understand your industry
Jeff Broin, POET CEO and his Co-Chairman, Wesley Clark have become the voice of the industry.  Obtaining industry information regarding customers, competitors, advocates and challengers, along with the ability to address these is essential to POET’s mission – and is crucial to its survival.

Know the technologies
Perhaps it goes without saying that a company needs to know the technologies that exist within its industry.  Many do not and remain internally focused.  POET stays current with new developments in science and engineering in both related and non-related industries as the way to develop its own intellectual capital.

Be aware – laws differ
Every state has its own laws.  So do other countries.  For example, Louisiana has a ‘fuel to pump’ strategy where Renergie, Inc. which includes ethanol produced form other feedstocks (not corn), decentralized network of small advanced biofuel manufacturing facilities, market expansion, use of alternative fuel vehicles for State agencies and advanced price preferences, provide jobs for those still unemployed as a result of Hurricanes Katrina and Rita.

POET’s voice
The ethanol industry’s own ‘civil war’ resulted in the emergence of Growth Energy, a new ethanol trade group that is a challenger to Renewable Fuels Association (which has been the leading ethanol voice until now, yet perceived by some as the lobbying arm for Archer Daniels – which raises questions for smaller ethanol producers who are now going out of business).
POET created Growth Energy and when Wesley Clark became POET’s Co-Chairman, he became the organization’s central spokesperson, along with Tom Buis, Growth Energy CEO (previous President of National Farmers Union and a very strong, top agriculture staffer for former US Senate majority leader Tom Daschle.) 

For example, Renewable Fuels Association is not perceived by some as sufficiently aggressive, especially in last year’s anti-ethanol PR campaign by the Grocery Manufacturers Association, and Wesley Clark took the lead.

POET is also at the forefront in the debate regarding raising the current blend of ethanol to gasoline (currently at E10 (10%) to E15 (15%) which pits ethanol producers at odds with other groups including automakers, boating groups, environmentalists and food who say there has not been enough testing. 
POET, particularly Wesley Clark is an aggressive spokesperson for E15. 
The only way to step up demand for cellulosic ethanol is to legislate for a higher blend of ethanol in gas.  
 
POET also speaks out on the issue of indirect land use.  The premise is that when US corn is taken out of the food supply, one indirect result is deforestation, particularly in Brazil.  The argument is that this practice is less carbon friendly than oil consumption because third world farmers now have to plow new fields to compensate for the decrease in the food supply due to using corn for ethanol instead of for food.  This was a consideration in California when the state issued new carbon standards designed to cut carbon emissions by 80% by 2050 and could lead to sharp reduction in ethanol sales in California after 2011.  POET is making sure its voice is heard.
Another important issue for POET is the push for the federal government to work on incentivizing pump conversion and flex fuel vehicle production for E12 and E15.  POET wants to be sure that the industry is ready for ethanol.

It is no accident that POET is growing and profitable.  The company demonstrates all seven of the PROFITS Principles.  The other four principles will be discussed in relation to POET in weeks to come.

The question now is how long this featured iTunes function will remain available to the Palm Pre before Apple stamps it out again.
The iTunes battle is part of a larger rivalry developing between Apple and Palm, whose chairman and CEO, Jon Rubinstein, once was an executive at Apple and oversaw the iPod.

The $200 Pre launched in early June as a competitor to Apple Inc.’s iPhone, and became the first non-Apple device that could connect directly to iTunes. Apple crippled that function with an iTunes update last week, saying Pres were “falsely pretending to be iPods.” 

This can happen when a Palm Pre is connected to a computer through a USB port.  The device gives out a hardware vendor code that Apple has been assigned by an industry standards group, the USB Implementers Forum. ITunes then recognizes the Pre as an Apple device and allows users to transfer content to it.

Say you’re in business.  You’re not exactly a ‘first-adopter’ yet you’re not too far behind.  Does this make you a wanna-be or do you have a perfectly legitimate claim to first rights? 

Or….is the question something entirely different when you shift your perspective?

PALM PRE, WebOS, iTunes and PROFITS Principles

If we think of the PROFITS Principles:  What is Palm attempting to do?

 POSITION ONLY FOR GROWTH
Palm has been jockeying for positioning in and around Apple for a very long time.
Though this may be merely perception, there appears to be a strong ‘copy cat’ strategy at work.
What do you think is the best way for Palm to position for growth - where they may win in their market space, rather than continue to come in as a sometimes close second - and be perceived as a sore loser?
What are the unique characteristics that Palm has to offer on its own reconnaissance?

REALITY
The reality is that Palm is always a step or more behind Apple.
The latest example is another indication that Apple is not going to let the grass grow under its feet.  In this latest episode, Apple makes it clear that they will next change the software so it is no longer able to be ‘tricked’ by Palm around the issue of the USB port code.
What are some of the positive differentiators that Palm has to better position itself as a key competitor in its market?

FLEXIBILITY
How can Palm demonstrate its ability to adapt and be flexible in the market to drive its own best competitive advantage?  It has demonstrated its ability to quickly adapt with the new Palm Pre.  Can Palm create a newer, better hardware or software application that stands on its own?
How else can Palm differentiate itself in either the music market for the future or in another market where it can be the first mover?

As more companies find technology the way to seamlessly integrate software and web ware from other companies - what are the rules of engagement?  Is there an etiquette that is about to emerge or will companies fight dirty to get what they consider to be their fair share of the market?

As always - please contribute your experience, wisdom and comment to the PROFITS Principles Community!

Warm regards,
Rosalie

What are some of the critical issues and possible solutions?  

 An example is the Kyoto climate change conference.The objective of the Kyoto climate change conference was to establish a legally binding international agreement, whereby all the participating nations commit themselves to tackling the issue of global warming and greenhouse gas emissions.  The target agreed upon was an average reduction of 5.2% from 1990 levels by the year 2012.

The Intergovernmental Panel on Climate Change (IPCC) has predicted an average global rise in temperature of 1.4°C (2.5°F) to 5.8°C (10.4°F) between 1990 and 2100. This affects the entire planet including the oceans, forests, polar ice regions, plants, animals, humans, etc.  No one knows what the exact tipping point is for global warming irreversibility - only that humanity has an opportunity to avoid it  - by holding carbon dioxide concentrations to no more than 450 ppm, to keep the average temperature increase at or below 3.6 degrees F (2 degrees C.)  Once the tipping point occurs, there may not be a way to stop the cumulative effects of climate changes such as droughts, flooding, loss of coastlines, species extinctions, etc.

Fossil fuels are the primary source of human produced greenhouse gases causing global warming.  A wide variety of renewable resources are being developed to take the place of oil, coal and gas. These energies include:

• Geothermal - heat which comes from the warmth of the earth
• Hydro - water power which can turn turbines and create electricity
• Solar - direct heat from the sun
• Waste - methane harnessing (from garbage dumps, byproducts of agriculture)
• Wind -clean electricity generated for homes, businesses, energy grids

 Today, Jim Lane, Editor and Publisher of Biofuels Digest, referred to the controversy of cellulosic ethanol and the debate about whether its production was actually responsible for more carbon emissions than previously thought.  There was also an article about ExxonMobil and its entry into the ‘algae race’.

So what does all this talk of carbon, algae and global warming have to do with your business?

If we think about the PROFITS Principles, the ones that come to mind are:

REALITY

• What is your business doing to both reduce energy costs and at the same time reduce carbon and other greenhouse gases into the atmosphere?
• How conscious are you about the affects your business has on the environment, especially if you are producing products that use chemicals and create waste?

 OBTAIN VITAL INFORMATION

• Are you tracking greenhouse gas emissions within your business? This includes energy usage.
• How educated are your staff about the environment and the hazards your business may be contributing to the environment.

INTEGRATION

• Do you have an energy strategy for the current and/or future of your business?
• If so, how do you coordinate your various business functions to work seamlessly to incorporate this strategy?
• How are you creating a strategy that takes into consideration your financial plans and day to day operations as your business contemplates energy resources for the next three years?

 Future blogs will focus on renewable energy issues and global warming trends.  We will also feature specific companies that are dedicated to environmental concerns.  We hope this will be an exciting topic that encourages your business to be thoughtful about how it utilizes natural and renewable resources.

As always, we welcome your experience, wisdom and comments.

 Warm regards,
Rosalie

 CIT Group Inc., the small-business lender with $1 billion in bonds maturing next month, pressed for more aid from regulators who are reluctant to use taxpayer funds for a company that may not be a risk to the financial system, people familiar with the matter said.

Treasury officials have indicated in talks that they are reluctant to deploy funds from the $700 billion bank-rescue program, and the Federal Deposit Insurance Corp. continues to balk at debt guarantees.   As of late Tuesday afternoon (yesterday) the Federal Reserve was considering granting permission to shift some CIT parent assets to its bank. That could boost the amount New York-based CIT could borrow from the Fed’s discount window, affording more time to restructure its debt. 
Today, CIT was turned down for a federal bailout and it probably won’t receive a federal bailout and is studying alternatives with advisers.

“They’re too little to be politically relevant, and therefore too little to obtain substantial federal support,” said Sean Egan, President of Egan-Jones Ratings Co. “You’ve heard of ‘too big to fail.’ This is ‘too little to succeed.’ “ 

The FDIC is concerned that standing behind CIT would put taxpayer money at risk because the company’s credit quality is worsening, people familiar with the regulator’s thinking said last week. CIT’s collapse would be the biggest bank failure measured by assets since regulators seized Washington Mutual Inc. in September. CIT reported $3 billion in deposits at the end of the first quarter.

The general consensus is that some of CIT’s riskier clients, for instance, entrepreneurs in the start-up phase of their businesses who lack a proven track record, or those that have a blemish on their credit, may find themselves abandoned.  Also, new lenders would likely demand stiffer terms, including higher rates, to offset risks. The banks might also ask borrowers to put more equity into their business.

The problem small businesses have right now is that they have fewer customers, lower cash flow, less equity. Borrowing for small businesses is not going to get easier anytime soon.

WHAT ARE YOUR OPTIONS?

Before you either panic or throw up your hands in disgust, it may be useful to ask yourself some questions that provide perspective about your expenses that may impact how you design your current and future funding and borrowing strategy - by cutting through the complexity of your business.

Cut through complexity

• § What expenses beyond the obvious ones do you bear?
• § Are you earning sufficient return on your investment in advertising promotions, marketing, discounts and other related fees?
• § What is your cost of capital?
• § Are your margins shrinking or increasing?
• § Are your inventories too high or adequate?
• § Are you paying overtime frequently to complete orders? If so, is this because due dates are often missed?
• § Do priorities change often? § Is it difficult to respond to customer demands?
• § Are there frequent shortages of materials, parts and/or supplies?
• § Do improvements in one department often come at the expense of others?
• Do you measure what you do?

Can you find a cause and effect connection between the answers to these questions and issues that your current financial structure may or may not be addressing optimally? 

In depth questioning about your business financials is the first step in developing a funding and borrowing strategy.

As always - PROFITS Principles Community encourages your wisdom, experience and thoughts!

Warm regards,
Rosalie

You now have an inexhaustible and clear ‘well’ to draw from. 

Though you want to be on the cutting edge and as proactive as you can be, 2009 is a year to respect the limitations of the economy.  Though I do not suggest  you follow a different approach than you might follow in a prospering economy, I do suggest that you take more time to make decisions and exercise caution.  Time and caution means exchanging information with customers, competitors, supplies and other sources.  It also means conducting yourself with the utmost professionalism.

PROFITS PRINCIPLES TIPS FOR A PROACTIVE BUSINESS

• Reality
  ANSWER THIS QUESTION:  WHO GETS THE PROFITS?                           

The first step is to think about how you perceive your current value chain.
Typically, your end user will have the most direct relationship with consumers.
Yet, you, the business leader are losing control of the consumer through social networking.  You may not agree or want to consider this. 
Reality is - that you need to ‘get your social networking’ in order because your end users and consumers provide vast on line feedback about you…..and THEY ARE DETERMINING PRICING AND PROFITS.

A month ago, Don Bartholomew, member of the Measurement Commission of the Institute for Public Relations, asked the question, “Is 2009 the tipping point for social media accountability?’ The answer was a resounding YES.
Your next question for guiding your proactive business approach is:
Am I attempting to control my brand - or am I willing and able to interact with social media and engage effectively?

David Cearley, of Gartner spoke at the Emerging Trends Technology Conference in Melbourne last June, about the total disruptive social media technology.  Social media IS NOT a tool.  It is the key shaper of your business.  Social media provides a platform that encourages participation and feedback from employees and customers alike,” he said. “The added value for businesses is being able to collect this feedback into a single point that reflects collective attitudes, which can help shape a business strategy.”

• Flexibility
  ENGAGE YOUR BUSINESS PROCESSES TO RESPOND TO SOCIAL MEDIA INFLUENCES 

There is nothing more important than creating responsive customer processes.

The late Michael Hammer, in his business revolutionary books, Reengineering the Corporation:  A Manifesto for Business Revolution, HarperBusiness, 1993), The Agenda, What Every Business Must Do To Dominate the Decade, (Crown Business Books, 2001), speaks to the FLEXIBILITY OF PROCESS.

This may sound like an oxymoron, as process defines a structure - yet you will find the flexibility and freedom that process truly provides.  It’s being ‘in control, out of control’ at the same time.
If you have not already done so - allow social media to influence how you shape and brand your business processes, rather than the other way around. 

Think about how you will best adapt to how your customers make decisions - not only psychologically, but through the influence of their on-line influencers.  Many times, decision making becomes an instantaneous ‘interaction effect’ between customer and social media, much like the new physics highlighted the shaping of the observer and the observed.  (Gary Zukav,The Dancing Wu Li Masters: An Overview of the New Physics: Bantam Books, 1984).  Make sure your processes allow for quick adaptations.

• Obtain Vital Information
  ENGAGE WITH INFORMATION SOURCES 

Find out what people are saying about your company, your competition, your vendors, your sales outlets, your leaders.
In the past, companies relied on focus groups and pilot studies, as well as information research databases such as Neilson and others.
This is no longer sufficient. 

Your leadership MUST have the mindset - a sixth sense in absorbing social media information into the fiber of their being - otherwise, they will miss vital information.  (See Frank Rushkuch, PR Media, July 1, 2009).  Many business leaders still tend to resist its influence and persist in controlling their brands, rather than adapting quickly to customer’s ‘legitimate’ demands as contrasted with fickle demands.  You must develop the judgment to sort between these.

According to Jeffrey Henning, the biggest advantage of online feedback is that it becomes an asset.  Where focus groups are variable costs, online communities, when companies create them are fixed costs.  Where focus groups must be organized to address the issue at hand, not providing results for weeks or months, online communities are like ongoing focus groups that can provide answers in hours or days.  Where focus groups can only provide qualitative research, well-designed marketing-research online communities can provide qualitative and quantitative research.      
                                  

 
Your comments keep this blog alive.  Thanks all, for the wonderful responses, particularly those who migrated their comments from Linked In and Twitter for the previous entries.  Keep posting!

Warm regards,
Rosalie

You may be incubating your dreams of a better product than those currently offered….so don’t talk yourself out of it!  Don’t listen to the non-believers or the nay-sayers who tell you what a lousy time this is to start a business.  It’s nothing personal…..they’re just projecting their own fear onto you.

 Not only can small businesses survive and thrive during the economic downturn; these small businesses can be the driving force for economic recovery, according to Stephen Betts, at the Proceedings of the Academy of Entrepreneurship. 

As of March 2009, the United States has fulfilled the definition of a recession - two successive periods of negative growth in the GDP and an increase greater than 1.5% in unemployment (Black, 2008). 

Due to many factors, the small business owner is dealing with the effects of the economic downturn.  Under financial distress, small firms behave erratically  (Pinadad, Rodrigues & de la Torres, 2006) and sometimes frantically (Lober, 2009).  A decrease in capital expenditures and profits is typical (Monte & Castillo, 2009). 

As may be expected, as layoffs increase, so do start-ups of small businesses.  Although there is a stimulus package this time, only $730 million in funding is for the Small Business Association.  Congress left out tax change provisions that could have saved many US small businesses (Robinson, 2009). 

The current paradigm has shifted from helping small businesses to preventing small business shutdowns (Heerwagen, 2009). 

Message:  Be Your Own Stimulus Package

Bottom line:  Small businesses are not beholden to Wall Street (Bandyk, 2008).  In past recessions, it has always been small businesses that drive the economic recovery. 
How can your small business be one that thrives and drives?

Two approaches: 
Defensive strategy - go into survival mode 
Proactive strategy - re-engineer your processes
Though both approaches cut costs, re-engineering prepares you for recovery and innovation.

KEY TIPS  FOR SMALL BUSINESSES TO THRIVE, SURVIVE AND DRIVE THE ECONOMY

First, be defensive and make sure your business plan is operationally and financially sound.

1.  Review your contracts, suppliers (and their businesses and   customers), customers, laws and industry regulations, capital structure.
2.  Examine and change business processes as needed
3.  Re-train and upgrade your workforce - especially management and think of your company as being a ‘pool of talent.’
4.  Review how any changes you make, effect your business valuation,   exit strategies, partnerships,  terms of all contracts and agreements.
5.  Then…Think about approaching investors - they still need to invest in great, well-managed companies.

 The next blog will focus on adopting a PROACTIVE market orientation that will not only help your small business thrive…..but DRIVE the economy out of recession!

Stay tuned…..and please offer your suggestions for what is working for your business.

Rosalie

 This morning, I was saddened to read about the bankruptcy of Seattle based retailer Eddie Bauer - the seller of high quality casual sportswear and accessories for the “modern outdoor lifestyle”, with 370 stores throughout the US and Canada.  The chain also has catalog and on-line divisions, participates in joint ventures in Japan and Germany and has numerous licensing agreements across many product categories.

With $268 million in outstanding debt, CEO, Neil Fiske, recruited to the company in 2007, told industry analysts that “the capital structure has simply too much debt for the economic reality we now face.”  Industry analysts simplify the problem further by stating that “sales are down and so is revenue.” It seemed like Eddie Bauer was doing all the right things.  They focused on the customer and built strong relationships with business partners for social responsible practices around issues such as the environment and global labor practices.

 Eddie Bauer, with its changing ownership landscape was formerly owned by Spiegel, until 2003 and previously by General Mills - with two very different corporate cultures and demands.

 Yet the higher they climbed, the more they seemed to lose their outdoorsy edge.

Once known for their exhibition creed - providing the US Army Air Corps in World War II with more than 50,000 parkas  and outfitting the 1963 summit at Mt. Everest, the company began to shift its focus to indoor casual.

 With a focus on turnaround strategy to return Eddie Bauer to its heritage as an active outdoor brand, the CEO states this may be thwarted due to previous crushing debt from the Spiegel reorganization in 2005 and the current recession environment. 

 Now - in its second Chapter 11 filing, the board received a limited guarantee from two affiliates of CCMP Capital on payment obligations.  There may be regrets about turning down a deal in 2007 to go private for $280 million with Sun Capital Partners, Inc. and Golden Gate Capital. 

 We will see what happens next….

 THE KEY FOR AVOIDING FINANCIAL DISASTER USING PROFITS Principles 
Go back to the “well” (your company’s raison d’etre) and replenish.

As you wonder how Eddie Bauer could have avoided this sad state of affairs - ask yourself what you are doing to avoid financial disaster for your company….before it happens.  As with Eddie Bauer, disaster doesn’t happen in a moment of time.  It is convenient to blame our problems on the economy.  What are the PROFITS Principles, that you, as either an intrapreneur or entrepreneur of your own company, utilize to avoid financial disaster?

• REALITY Review your financial structure and ask:  What decisions am I making when structuring for debt/equity? These require both long and short term considerations.
• OBTAIN VITAL INFORMATION Focus on the competition - to obtain vital information and do not adopt a new anxiety-driven shotgun strategy.  Instead, first focus on how you can differentiate yourself from the competition.
• INTEGRATION Integrate all aspects of your business.  Eddie Bauer kept adding more and more to their strategy.  Has anyone studied whether these strategic moves (adding indoor casual, adding strategic partners, selling licenses, on-line shopping, catalog division) worked together as an integrated whole?  I haven’t seen anything!
• FLEXIBILITY Are you nimble enough  - financially, strategically, operationally to be proactive in a volatile and disruptive competitive environment?  How can you become moreso?

 Our PROFITS Principles Community is growing rapidly.  As always, we welcome your comments in expanding the PROFITS Principles.

 Though he already researched the size of the market, (which appeared to be approximately $200 million) and the competitive landscape, Jon still needed to obtain vital insider information about specific competitors – their strengths, weaknesses, customers and end-users.  He had to learn about other disruptive technologies on the horizon and then determine if he knew enough about his potential customers and their customers.

 After meeting with the technology transfer division at MIT and a venture capitalist investor, Jon realized it could take at least a year or more to negotiate terms with MIT and to position his company for funding.  Jon would to have to bring on some heavy hitters for his management team.  More than likely, MIT, the venture capitalists and his new team, could quickly chip away at the wealth he envisioned as his own. 

 Based on initial calculations, Jon projected the need for $2.5 million to fund the project for two years. This included capitalization to further develop the platform, to obtain the required content licenses, for technology hardware and software, hiring consultants and meeting fixed expenses such as office space, utilities and administrative help. 

 Yet… what experience did Jon have with these negotiators?  None!  Jon knew he was smart and good at what he did.  And yet, he was a specialist with good ideas.  He could spot opportunities and then dig in and do the work.  He was a good manager and knew how to influence others.  Would he be a good entrepreneur?

 If you are contemplating whether you should remain with your current company – or start up one of your own, consider the strengths of the intrapreneur.

1. You have a good sense of timing.  You have patience and know when it is opportune to make the move.
2. You stay focused. You can keep your ‘eye on the prize’ when you are not the decision maker.  You are able to continue making inroads without giving up or alienating those who are decision makers. 
3. You know when to hold back. When your suggestions are thwarted, you view it as temporary and continue working behind the scenes.
4. You are a skilled manager. Using gentle influence, especially when there are cross-functional considerations, you maintain respect and integrity – and keep communication open.
5. You are humble and do not take all the credit. Validating the importance of others’ contributions, people clamor to be part of your team.

We welcome the comments of our PROFITS Principles community!

And now…..2009, the year you expected to launch your new business is fraught with a sagging economy and possibly a recession. You have a job that’s ok. You don’t love it. You enjoy most of your colleagues. You have some flexibility. The reality is…it works, it pays the bills and gives you the mental, if not physical time to design your dream.

“Now what?”, you ask yourself. Do you keep your day job longer with your 401K and benefits? Ah…you can feel the freedom. It’s so close….yet so far.

And on it goes. The back and forth – the pros and cons, along with the nagging voice that says “Now is the time. If I don’t do this, I’ll never know if I could make this business a success. Yet, if I am worried about money because my customers can’t pay, will I fail anyway?”

This thinking is not as rare or strange as it might sound. Millions of people are having these conflicting thoughts and emotions. Conventional wisdom – and even the wisdom of well-respected business gurus like Donny Deutsch (CNBC show: The Big Idea, which CNBC removed from its programming this year, because the powers that be anticipate that future small business entrepreneurs are awaiting a better economic climate); and Suze Orman (also with a CNBC show: The Suze Orman Show) who advises mainstream Americans on how deal with their finances, suggests that we hold onto our day jobs before we take the leap into the great unknown.

PRACTICE THESE SKILLS AND ADVANCE IN YOUR DAY JOB
BECOME AN INTRAPRENEUR….

Key Skills to Advancing Anywhere…

• Presentation Skills
Learn to be clear, articulate and focused
Breathe…..and speak from your diaphragm
Use visuals
Skip the jokes if you’re not a comedian

• Consulting Skills
Understand your client’s business – inside and out
Learn to partner and collaborate – not tell
Listen, listen, listen and listen some more
Manage expectations

• Communication Skills
Find the human connection
Focus to get the outcome you want
Provide your full attention

We look forward to your comments, sharing your experiences and wisdom.

Perhaps you now face a competitor’s new product on the market that sells like hot cakes, stealing your market share percent by percent.

Maybe a valued employee leaves your company, after you’ve sent her at a $5000 seminar and confided your five most exciting growth ideas for next year.  Your most reliable supplier discontinues a chemical you require for your product line and customer demand is in the triple digit range.

Business life, even as we strive with dignity and class, is usually messy and inconvenient.  Did the thought ever cross your mind – “This wouldn’t impact a Fortune 500 company.  No way! They’re bigger.  They have other divisions to absorb the loss of this product.  They have more people and can switch gears quickly.”
Your thoughts are certainly realistic and I’d like to add one tidbit of information – Fortune 500 companies can trip over their complexity.  Many large companies may know what to do and the big question for them is:  Can they deliver the results they promise and in what timeframe?

Small companies must use everything they can to succeed.

In his new book,The Strategy Paradox, Michael Raynor states, “The external environment in which we find ourselves is very uncertain, where changes in regulations, the economy, competitors’ behavior, customer preferences or new or disruptive technologies could each, or in combination, dramatically change the operating landscape.  The ability to take bold action with urgency, while maintaining strategic flexibility has never been more important.”

I invite you to please share your musings and thoughts as you concur that we are not alone in the entrepreneurial journey……