Why should I care about politics? It’s just a bunch of doublespeak from a collection of greedy, grimy people with big egos. Why should I care about the Consumer Sentiment Index? Isn’t it just some arcane statistic that gets published every so often? Why should I care about the financial crisis in Greece? Why should I care about the number of Baby Boomers who will reach 65 each year for the next ten years?
Entrepreneurs are a busy lot. We’re always on the run and totally consumed by what goes on in our world. So it’s tough to stay abreast of what is happening “on the outside.” And besides, there’s so much information out there that it’s simply overwhelming. Right? All of this is pretty much true . . . and more. But here’s the big “however.” Everything that is happening around us – 24/7 – is a treasure trove of opportunity. If we invest some time and effort, the information we uncover may help us connect the dots. These are the dots that could lead us to discover a new and innovative product; or identify a trend that could help or hurt our business.
Connecting the dots will require an open mind, a healthy dose of curiosity and the ability to think critically. I’ve always wanted to be the one to connect the dots as opposed to having someone else do so because that “someone else” could very well be a competitor. Some things we learn may have no direct connection to anything to do with our business or personal lives. And yet, we never know exactly when a supposedly random tidbit might be that final puzzle piece we’ve been desperately seeking and didn’t even know what it looked like. I’m constantly advocating that we entrepreneurs should be voracious readers of everything we can get our hands on. And what we read should be broad and diverse.
Allow me to try and tie all of this together with a hypothetical example. Let’s assume that you and I own a company that manufactures fine oak barrels for premium wines. Why do we care about politics? A stiff tariff was being proposed on the special metal bands that we import from Japan to secure our barrels. Our relationship with several elected officials enabled us to educate them on the unintended consequences of this action and the tariff idea was scrapped. Dot A was connected to Dot B. As students of the Consumer Sentiment Index (compiled and published monthly by the University of Michigan) we learned that Americans are becoming increasingly more optimistic about the future of the country. Based upon history, we know that Americans drink more expensive wines when the future outlook is bright. With this knowledge, we make the decision to expand production of our wine barrels to meet increased demand. Dot C was connected to Dot D and then Dot E.
The ongoing financial crisis in Greece proved to be a tipping point for us with respect to a significant customer there who bought large lots of our wine barrels periodically. Because the Greek government restricted the amount of cash that could be withdrawn from the banks on a daily basis, we became concerned that this customer might have difficulty selling his product. We suggested that he scale back his order until more normal conditions existed in his country which saved us from carrying a large account receivable with him. Dot F was connected to Dot G.
Finally, by studying the demographic trends involving the number of retiring Baby Boomers and matching that with their buying habits, we projected that there could be a large increase in their purchase of premium California wines. We deployed one of our top salespeople, armed her with this data and sent her to call on the wineries in the Napa Valley. She came back with a terrific picture of how these wineries intend to introduce several new brands that match with the emerging tastes of the Baby Boomers. Dot H was connected with Dot I.
Paying attention to the world around us can yield valuable information. We can then connect the dots using this data in ways that contribute to the success of our enterprise.
This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.