Every day there are a hundred of issues that come across our desk that we know we need to solve. Against better judgement, we start to think that the options in front of us – an employee you may hire, a vendor you may select, an investor you may take money fromโfits your needs even though in your heart of hearts you know you are making a bad decision. The pressure we’re under makes it very difficult to distinguish between the right and wrong solutions to our needs.
“The daily pressure we’re under makes it very difficult to distinguish between the right and wrong solutions to our needs.”ย
We are under pressure. We have limited time and resources. We want customers. We want money. We want people. We want investors. Nope. We need customers. We need money. We need people. We need investors. Gaining market acceptance is key to our success. Forging relationships with key employees, vendors and investors is critical. When we interact with the market, interview an employee, evaluate a vendor or present to an investor, we wantโsorry, needโthings to move in a positive direction. We want to believe that the customer, employee, vendor or investor sitting in front of us wants to do business with us or is right for our business
You will be evaluating a consultant who seems to have a lot of experience and isnโt that expensive. He can also start right away. Our first thought is, โWow, someone who we can afford and who is available?โ Do you ask yourself, โIf he is good, why is he cheap and why is he not working?โ Of course not. We want to believe.
The Wrong Perspective
Entrepreneurs with a flawed perspective let the pressure, passion, pleasure and pain overcome their judgment, and the judgment of others, to ignore the facts in front of them. For example,
- Employees.ย You interview a prospective employee who has never worked in your industry. You convince yourself that if the individual knows his functional area, you can teach them the industry, even if the industry is nuclear physics.
- Investors.ย Or you meet with potential investors who have a track record of negotiating contracts that require an exit event in one to two years. You turn a blind eye to this risk, and convince your team that this will force you to be more focused and efficient than your original five-year plan.
- Underestimating Time.ย This perspective also causes us to underestimate the amount of time it takes to forge relationships with key constituents such as customers and investors.
- Customers.ย You want to win this customer. You need to win that customer. Donโt get me wrong, you can influence and shorten a sales cycle. However, winning customers takes time. At every stage, you must earn the right to advance with customers. Objectively understanding where you are in a sales cycle is critical to tailoring your strategic and tactical approach to winning customers. That starts with understanding where you stand, not where you want to stand with a customer.
- Investors.ย The same is true when it comes to investors. You are running out of money and time. You need investment. Not surprisingly, you walk out of an investor meeting assuming the following: The investor youโve just met for the first time, is perfect. The investor is definitely interested and will finalize an investment in thirty days. Be realistic with yourself. Investments take a long time. Assume six months. If it happens quicker, great. Donโt forget, investors are deliberate and see a lot of deals.
There is nothing wrong with being excited, but donโt let your need or desire (or panic) about the necessity of capital cloud the details of the meeting, terms, or relationship that is actually occurring.
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