What beats printing money?

93840 - Printing money is great, but the high risk is that the feds can come after you. So I guess we can all forget about printing money!

However, there is an activity that beats printing money. It's also extremely legit (no feds will come after you).

It's called the "art of cashflow design."

Let me explain.

Today, information allows us to create ANYTHING. (Read Thomas Friedman's The World is Flat for detailed info).

And technology (especially the Web, but also DVDs, telecome, etc.) allows us to reach ANYONE.

So if you can create anything and reach anyone, what's the main obstacle to you becoming RICH?

Cashflow design.

In other words, basic business skills and basic entrepreneurship skills.

Will gettting an MBA help? No. MBA stands for Master of Business Administration. MBAs are hired to run other people's business, they are not expected to CREATE any new business.

You need an MBC degree (Master of Business Creation). Of course, that degree doesn't exist yet.

However, it doesn't change the fact that more and more people are secretly learning the art of Business Creation.

That's what my BMW workshop is all about. I teach people the simplest way to view business and thoroughly understand what business is all about, so they can easily design "cashflows."

Some of my coaching clients have already seen the power of "cashflow design" as they've heard my ideas and are actually getting busy in creating and running new businesses that they did not think about before!

20. How to seduce employers

If you want to seduce women, you have to think like women.

If you want to seduce employers, you have to think like employers.

The above is very much common sense, yet many job seekers do not think at all like the business decision-makers who have the power to hire them.

Companies are not looking for people with an awesome resume (which is mostly fiction), or people who can impeccably answer interview questions (which is mostly rehearsal).

However, they are ALWAYS looking for people who are able, willing and motivated to solve business problems. They are always looking for people who can help the company grow profitably.

The problem, of course, is that most employees don't understand how business operates.

This is why we created the BMW workshop -- Job Seeker version -- for people who want to know HOW their current (or future) employer is thinking. How they actually create value, remain successful and ensure profitable growth.

At the same time, with the BMW knowledge, you can fairly easily "reverse engineer" the value-creation processes of your employer and learn how to do business.

Someone who knows the BMW principles is never afraid of the pink slip. Such a person knows that he/she can add value to any other employer in the same industry. In other words, such a person can seduce any employer by simply demonstrating thorough understanding and mastery of the business model of the targeted employer.

With the BMW knowledge, you can sit in front of any employer and be able to "make him an offer he can't refuse."

That's power.

20. How to seduce employers

If you want to seduce women, you have to think like women.

If you want to seduce employers, you have to think like employers.

The above is very much common sense, yet many job seekers do not think at all like the business decision-makers who have the power to hire them.

Companies are not looking for people with an awesome resume (which is mostly fiction), or people who can impeccably answer interview questions (which is mostly rehearsal).

However, they are ALWAYS looking for people who are able, willing and motivated to solve business problems. They are always looking for people who can help the company grow profitably.

The problem, of course, is that most employees don't understand how business operates.

This is why we created the BMW workshop -- Job Seeker version -- for people who want to know HOW their current (or future) employer is thinking. How they actually create value, remain successful and ensure profitable growth.

At the same time, with the BMW knowledge, you can fairly easily "reverse engineer" the value-creation processes of your employer and learn how to do business.

Someone who knows the BMW principles is never afraid of the pink slip. Such a person knows that he/she can add value to any other employer in the same industry. In other words, such a person can seduce any employer by simply demonstrating thorough understanding and mastery of the business model of the targeted employer.

With the BMW knowledge, you can sit in front of any employer and be able to "make him a offer he can't refuse."

That's power.

19. Nobody makes money!

"Are you making a lot of money?"
"It's tough to make money in business these days."
"A business is a money-making machine."

We often hear these statements, yet they are completely false. Totally untrue. Utterly misleading.

Nobody makes money. The only people who "make" or print money is the federal government, through the Bank of Canada.

For the rest of us, the only thing we do is pass around money (paper or electronic). The money usually goes to where there is a lot of value (defined as the ratio of "perceived utility" to "sacrificed cash"). If "sacrificed cash" equals zero, then value is infinite. Hence, the enormous success of Netscape, Yahoo!, Skype, etc.

(The above paragraph contains a powerful business secret, and if you got it, I predict you will soon open a Swiss bank account).

Money is sex, value is love.

Asking a business person how much money he's making, is like asking a husband: "Are you having a lot of sex with your wife?"

Not only is it none of anybody's business, it also shows a complete misunderstanding of the purpose of a business.

A business, like a marriage, exists to build something for the long-term. Something we often call a legacy.

And anything built for the long-term should be planned, tested, verified, audited, and continually improved.

But these critical activities can only be performed IF the business system is clearly documented.

In conclusion, although nobody can "make" money, we can create value for customers. The greater the quantity and quality of value we produce, the more money will flow to us. To improve the quality and quantity of value produced, we need a system. To improve that system continually, we must document it thoroughly.

18. Focus, focus, focus

Harvard Business School professor Theodore Levitt wrote: "The purpose of a business is to create and keep a customer."

When you think about it, this is precisely what Nike is doing: they specialize in marketing, branding and advertising. In other words, they are experts at "getting" and "keeping" customers.

Although the company's signature slogan is "Just do it", they chose NOT to do it. That is, they outsource manufacturing and distribution to other companies (in other countries)!

The lesson here is that even a big company cannot do everything; they have to specialize and focus on what they do best.

A first-time entrepreneur usually is cash-strapped, so he/she should focus even more. We advise participants in our BMW workshop and in private consulting to focus on either:

1. marketing
2. selling or
3. production

17. Fire vs Insurance

I remember a Far Side cartoon I read a few years ago. Two cavemen were standing around a little fire which, apparently, they had discovered by accident. They had a look of surprise and joy on their face, and their hands were in the air.

The first caveman exclaimed: "I invented fire!"

The second caveman exclaimed: "I invented insurance!"

The insight here is pretty deep: although fire is one of the four elements, nobody has ever been able to create a business, let alone an industry, based on fire.

Insurance, however, is a multi-billion-dollar industry.

In a way, the Internet is like fire. The inventor of the Internet, Vincent Cerf, didn't make money from it. One Christmas eve, he generously decided to "give it away" to the millions of people on Earth (he was rewarded only years later with a $500,000 prize from a European organization).

Other people, such as the founders of Netscape, Yahoo!, Amazon, eBay, Skype, etc. DID make a lot of money from the Internet.

The basic difference between inventors who don't make money (inventors or discoverers of fire, Internet, etc.) and entrepreneurs who DO make lots of money, is that the latter had a clear system for creating value and for delivering that value to people who wanted it and were willing to pay for it.

This is precisely what we teach in the BMW workshop: create a business system that creates economic value all the time, so you can make money all the time (even when you're sleeping).

16. How Donald Trump teaches Business 101

In the first episode of The Apprentice, Trump separated the participants into two teams: a girls team and a boys team.

He gave each team $200, and told them to set up a lemonade stand on a street in New York and make money.

The girls team won by generating revenues of $800 (400% return on investment). The boys team only generated $400 (200% return on investment).

I believe the first lesson from billionaire Donald Trump is that you've got to understand and be able to go through a complete business cycle. You've got to go from marketing (attracting busy pedestrians to stop at your lemonade stand), to selling (interacting one on one with each potential client and persuade him/her to buy a lemonade), to production (actually producing the lemonade and collecting the money).

Notice that Trump didn't ask them to write a business plan!

In other words, if you're afraid of people, if you're afraid of selling, you should reconsider your idea of going into business.

Like the saying goes, "Show me a guy who's afraid of rejection, and I'll show you a guy you can beat every time."

In the end, I think that lemonade exercise was brilliant.

In subsequent episodes, Trump tested the "apprentices" on various other business models, focusing on event management, project management, etc.

15. Size matters not

If you truly understand business fundamentals, the way a CEO should understand them and master them, then the size of your business shouldn't matter. You could run a $50,000,000 business as easily -- relatively speaking -- as a $5,000,000 business.

Business is fundamentally about leverage, and it is how a CEO plays with various levers that determine success. The main leverage occurs through management, of course, so it helps to master management basics.

But no matter how much leverage you command, the basics of business should be present: marketing, selling, production.

There are about 22 different business models (e.g. a movie production company is a different business model than a downtown retail boutique), yet they all share the same critical need for marketing, sales and production.

14. Why startups fail

4 out of 5 new startups fail within the first five years.

It doesn't have to be that way. All it takes is a daily objective assessment of the company's status in three major areas: marketing, sales and production.

This is what the BMW workshop teaches. It's a ruthless system of objective business performance evaluation.

A business owner who practices the BMW philosophy, will have reality stare at him / her every single day. He/she will not be able to escape the (harsh yet necessary) truth. Truth is needed for growth.

It is said that you can choose to take any action you want, but you cannot choose the consequences of your actions.

The Business Modeling Workout workshop is just an application of that principle, and I think it can help first-time entrepreneurs to get acquainted with the fundamentals of how a business operates.

The key to business success is to leverage emotion within the target market, and to leverage logic within the enterprise.

13. A job is often an economic black box

A lot of people, especially staffers, don't know exactly how they create value. In other words, they don't know nor comprehend the process by which they actually create economic value.

All they know is that they get a paycheck once every two weeks, and that's their only indication that they are actually producing value.

I guess this is why Ram Charan, a highly respected advisor to CEOs, wrote the book What the CEO wants you to know. Charan understands that today, EVERYBODY, from the receptionnist to the C-level executive, is in business for himself / herself.

In the BMW Workshop - Professional Version, we teach people how to evaluate their position in the business cycle of a company.

There are only three critical activities: marketing, sales and production.

Any person who occupies a position OUTSIDE of these three critical areas, is a prime target for outsourcing or outright elimination from the payroll.

12. From possible to probable

I wrote a posting HERE on using one's brain to go from what is "possible" to what is "probable."

Statistics show that within 3 years, 70% of all new businesses fail. In other words, most entrepreneurs will probably fail.

The challenge is for them to develop a system that makes it more probable for them to succeed.

This is perhaps the key benefit of the BMW workshop: it shows all the risks that a business MUST face, and how he should continually find ways to reduce or eliminate certain risks in order to increase his/her probability of success.

In other words, by having a business system that you improve daily (in the same way that Amazon founder Jeff Bezos says that he tries to improve his e-commerce system every day), you dramatically increase your odds of success.

11. Business plan vs business model

Many people ask, "what's the difference between a business plan and a business model or system?"

A business plan is like a giant flashlight: it shows you the future and what's ahead of you (3-5 years).

A business system, on the other hand, is the car that allows you to move forward.

A plan doesn't have to deal with present reality, although it should tell you how to deal with future reality. A plan is only your best estimate as to what reality will be like, and it's a description of what you intend to do in that future reality.

A system deals with reality, and with the present.

A plan usually has a lot of assumptions; a system usually has no assumption. Every element that is part of the system has been tested in the real world.

Your car, for example, is a system. You absolutely need to know that everything works smoothly before you take the highway! If a part of your car wasn't reliable, then your life would be in danger -- and of course nobody wants to put their own lives in danger.

In business, there are also many dangers. This is why you need to have a system that you KNOW will work flawlessly -- especially the critical processes.

10. Intrasystem vs extrasystem information

Have you ever thrown a peanut in the air and tried to catch it with your mouth wide open?

If you succeed, then you get to eat the peanut. If the peanut falls to the floor, then I highly recommend letting it go!

Similarly, the BMW workshop enables participants to create a business model so they know exactly what information is relevant, and what information is NOT relevant.

The relevant information -- just like the peanut -- enters the system and provides fuel (I don't know exactly how many calories a peanut contains, but you get my point!).

The problem is, people who don't have a business model will try to get a lot of information and knowledge, most of which are IRRELEVANT!

This is why Peter Drucker wrote about "information literacy." He said we don't know what information we need, and we don't know how to get it. Lester Thurow wrote the same thing, arguing that every company should have a Chief Knowledge Officer, whose job is more or less like the CIA director's job: to scout and scan the environment for information relevant to decision-making and policy design.

If you're running a business, you know what I'm talking about. You know about the importance of relevant information, because you know your decisions are only as good as your information.

But if you're an employee, you might wonder: "Why do I need to be information-literate? Why do I even need to create a business model?"

You need a business model because your job, whatever it is, IS a business. You were hired to produce "something," and in return, the employer pays you a salary that reflects the value of that "something."

To increase your salary, you can either increase the quality or the quantity of that "something." But to do either one (increase quality or quantity), you need to become a business manager! You need to see clearly the system that guides you in doing your job.

In the BMW workshop, we just teach people to make visible their business system. Since you can only improve and manage what you see, it makes sense to create a system or model that accurately shows HOW you actually create value.

Once you have your business system clearly drawn on paper, you can then easily determine which information coming your way is relevant, and which is NOT relevant.

9. Everybody needs a BMW

Something not so funny happened on the way to the New Economy: your job disappeared.

Wait, don't panic. You will still have a paycheque, except that it won't come from an "employer." Rather, it will come from a client.

What's the difference between an employer and a client?

An employer is more bureaucratic. Translation: through office politics, red tape, corporate protocol, ambiguity about accountability, shielding from market forces, etc. a person who's doing a lousy job can still keep his/her job.

A client is much more demanding: you stop performing to HIS standard, and he can tell you not to come back on Monday.

The solution?

Act like a businessperson. An entrepreneur. Be in business for yourself. Consider yourself to be what Brian Tracy calls "the CEO of your own personal services corporation." In other words, don't think you have a "job." Think that you are just renting out your personal/professional services to a client (who can fire you anytime).

Note: Much to his credit, Tracy wrote this 10 years ago!

Because everybody -- without exception -- has to think that he / she is in business and is only serving a client (not an employer), then it means that the BMW workshop is for everyone.

Yes, 6.5 billion people on Earth could use the systematic, strategic and stringent framework that we teach in the workshop to "attract, sell to and serve clients."

Without the knowledge imparted by the BMW framework, you cannot be secure economically; your economic future and destiny will be at the mercy of someone else.

8. Business Model Innovation

Business Model Innovation (BMI) is the new name of the game, according to strategy guru Michael Porter.

Yet, most people are not even familiar with the simple idea of a "business model." That's because we were educated and trained to become employees, not business owners.

Employees can be relied upon to do their job, but not to understand how the company they work for actually operates. And because they do not understand how the company makes money or creates value, they cannot increase their contribution to the employer's success -- this makes them highly vulnerable to any slash in workforce.

Fortunately, it's not hard to figure out how a company makes money. There are only 22 business models, and they have been studied extensively by business schools.

In our BMW workshop, we showcase those 22 business models, and teach people how to master their specific business model in order to ensure success.

As an employee, if you truly understood how your company makes money, you can then begin to contribute DIRECTLY to their bottom line. This will make your job virtually "unslashable."

What if you don't know exactly how your job contributes to the company's profitable growth? Well, chances are, the CFO (chief financial officer) also won't know, in which case he might slash your job -- i.e. send someone to give you the famous pink slip).

BMW is your career security.

7. Make 100 mistakes in 60 minutes

Here's the biggest advantage of putting on paper your business system: when you go over it with an experienced business trainer or coach, you can actually make 100 mistakes in less than an hour.

In other words, a good business coach will ask you over 100 questions and, chances are, your answers will be incorrect, suboptimal or less than ideal. Your business coach can then "correct" you, so you can make better decisions in real life.

It is indeed much cheaper to fail on paper than to fail in real life.

6. Employee vs Business Owner

When you work for a company, you have a clear job description. You have a manager who oversees your work and corrects you when needed. In that situation, it's hard to stray because if you think or act outside the "box," there are corporate / bureaucratic mechanisms that will alert you.

But when you run your own business, the chances that you will make mistakes are much greater; this makes sense, since there is no boss to oversee your work. You are your own boss.

This is why it's so important to have a clear system, and to use that system to manage your company on a day-to-day basis.

5. It's okay to be emotional

In many situations in life, it's okay to be emotional: when you watch a good movie, when you hang around with friends, when you meet new people, etc.

But when it comes to your career or your business venture, it's time to become Mr. Spock!

In other words, you should be ruthlessly rational when making business decisions.

(Here, many people might argue that career decisions can be emotional, based on one's passion. I would argue that a career CHOICE can be emotional, since that's when you decide which field to get into, and this obviously has to do with your interests and passions. But a career DECISION must be rational. A choice is about doing the right things, a decision is about doing things right.)

Here's a tip to "enforce" rationality in your business thinking and behavior: make your business information, data, plans, decisions, etc. as public as possible. In other words, share the info with people you trust. Get their blunt feedback (tell them you don't want polite feedback, which is useless; you want the truth, so you can improve).

4. Business system vs business plan

A business plan, especially one written for investors, is a wonderful work of fiction.

Seriously!

A business system, on the other hand, is a bit more trustworthy. It shows precisely what happens, when, where, how and why. It is an accurate reflection of reality unfolding in the marketplace. If you have such a system under your nose, in the form of a business system blueprint, I can guarantee that you have a high likelihood of success in business.

If you don't have such a system, the odds that you will fail will be great. In fact, the overwhelming majority of people who start a new business fail within 3 years.

Compare this to people who buy a franchise (which is a clearly documented system) -- the success rate is 98%.

Conclusion: without a formal, explicit, self-adjusting system to guide you in business, you will fail. It makes sense, therefore, to do everything you can to "visibilize" your system and improve it relentlessly in order to ensure its superior performance over time.

The most successful entrepreneurs work relentless at improving their business system.

For example, Jeff Bezos said that even on week-ends, he looks at the pages of Amazon.com in order to find ways to improve the system.

3. Make it visible

The BMW workshop teaches people to make VISIBLE the system that generates income for them.

If your value-creation (i.e. money-making) system is not visible, then you cannot improve it. Worse yet, you cannot repair it if/once it's broken.

A system is an invisible machine, and a machine is a visible system.

Once you make your career/business system visible, so many people can help you. But as long as that system is in your head, not many people can help you. You might not even be able to help yourself!

E.M. Forster put it this way: "How can I know what I think unless I see what I say?"

2. The concept of a "job" is most unprofitable

In today's global economy, there are no "jobs" anymore.

Everyone is responsible for offering a business service, and for charging fairly for that service.

I say a "business service" because most people work for a business organization.

Yet, many people still think in terms of a "job." Although the concept of a job, especially a permanent job, may sound comforting, it is in fact misleading.

In the old days, if you had a job at a big company, you were assured of a certain economic stability. Not so anymore. Today, there's always someone in management who's looking at your job description, your performance, your output, the criticality of your work, etc. and who is a flick of the pen away from slashing your job.

Management doesn't keep you on the payroll out of the goodness of their heart. They keep you on the payroll because they are convinced you provide a valuable business service that helps the company grow profitably.

Therefore, the more you understand business, the more secure your job and career will be.

If you don't understand business and how your work specifically contributes to the company's profitable growth, your job will never be secure. Your economic survival will always be at the mercy of someone else.

1. S.Y.S.T.E.M.

The ultimate purpose of the BMW workshop is to help you create a money-making system.

A S.Y.S.T.E.M. means "Save Your Self Time, Energy & Money."

Most people who go into business, often start by offering professional services (graphic design, communications services, consulting, etc.) and this is good. They do what they do best.

But it's not enough to survive in business. You have to be able to create an impersonal system that supports your work. Michael Gerber wrote about such a system in his book The E-Myth.

For example, a website where prospects can fill out a form and type in their needs, goals, questions, etc. is one small system that works for you (even while you're sleeping!).

The idea is to create as many of those little systems as possible, so that you save time, energy and money.

Welcome!

I created the BMW (Business Modeling Workout) workshop to help first-time entrepreneurs succeed in their new business ventures.

In this blog, I will share with you valuable information from the BMW workshop.

If you have questions, please feel free to email me at omnidigitalbrain@yahoo.com

Best regards,

Peter Nguyen, BCom
Co-founder, trainer, coach
Talentelle
www.talentelle.com