Don’t compete, CREATE!

As a small business owner, you've probably heard about the growing need for creativity and innovation. Let's put things in perspective. Firstly, we know that franchised businesses are generally more profitable and successful. We've heard the rule-of-thumb regarding the 80/20 rule. 80% of small businesses go out of business in the first 5 years, while the reverse is true of franchises - 80% of franchises are not only still in business, but thrivingE-myth.

So what do franchises get right? Good systems, and strong marketing. Do you need to be a franchise in order to have good systems? No, there's good-value help available from companies such as "Brain in a box" who focus on providing robust, effective systems for small businesses.

At the very least, reading and applying Michael Gerber's E-Myth material (on systemising the business) is invaluable to your future business success. But having good systems is only half the story - creativity, innovation or being imaginative is highly important to small businesses, and increasingly so. Research confirms that Einstein was right all along.

Imagination really is more important and profitable than knowledge. Experience, and what you know about your market, together with good systems is helpful, but new data reveals that entrepreneurial startups are the real engine of economies:

"a new data set from the U.S. government, called Business Dynamics Statistics, ... provides details about the age and employment of businesses started in the U.S. since 1977.  What this showed was that startups aren’t just an important contributor to job growth: they’re the only thing. Without startups, there would be no net job growth in the U.S. economy."1

Without startups, there would be no net job growth in the U.S. economy! Can we assume it's much the same story for the Australian economy? Take a look around, at the new businesses doing things differently. Creativity matters. Still not convinced? Research also confirms that trying to out-execute your competitors in your existing markets is around 4 times less important and effective than being creative and working new markets.

"... a company's choice of where to compete is almost four times more important than out-executing its competitors in its market."1

Besides, when we're creating and exploring new ideas and markets we stretch, learn and grow ... and we're happier as a result, at least according to Nobel Prize winning author, William Butler Yeats:

"Happiness is neither virtue nor pleasure nor this thing nor that but simply growth. We are happy when we are growing."

If you want more profit, business growth and fun, contact Stephen Pirie.

ps. I once saw a large banner in a trading room of one of my (past) clients (well-known merchant bank) that read, in big letters:

Don't compete, create!