“The competitor to be feared is one who never bothers about you at all, but goes on making his own business better all the time.” – Henry Ford
What does it take to start a home-based business and turn it into a global organization? I am sharing the many lessons I’ve learned to do just that.
In 1985, I started a small business from my home in Southern California. Today, BNI has over 7,400 locations in more than 65 countries around the world (see the member growth chart to the right).
From business networking to management, scaling a business, and surrounding yourself with good people, I will be sharing with you the secrets for building a global brand.
Go here and subscribe to my new Garage to Global Channel (part of the Entrepreneur Network) on YouTube: http://tinyurl.com/garagetoglobal.
Share with me below what you think it takes to go from “garage to global” (but don’t forget to subscribe to my new channel. 🙂
As business people and networkers, and even in our personal lives, we are often trying to make things harder than they need to be. There is an abundance of techniques, for sales, communicating, and general business practices, that are tried and true, so much so that they seem too simple to truly be effective. We re-evaluate them, we “improve” upon them, and we overcomplicate them. Possibly worse, we sometimes just scrap the old way and try to start over from scratch.
Often, we think we are smarter than those who came before us. Our egos prevent us from listening to those who have more history. The danger here with reinventing the wheel is that it puts us in danger of history repeating itself.
Here are three common warning signs that you may be falling into the danger zone of repeating work, and what to do about them.
- Instead of solving a problem, you come up with new features to cover it up. First and foremost, this is poor customer service to add features to try to distract from a known issue with a good or service. Instead of wasting your time coming up with new features on an old issue, spend time diving into the old issue and make minor changes on existing features to elevate the whole product.
- When something with history doesn’t work perfectly, you think it might be easier to start over. Without a doubt, there was a reason things got to where they are. Instead of erasing all of the work of those before you, do a little research. Take time to talk with your predecessors and learn what the motivation behind choices were. Chances are you will discover the core problem, and be able to instead make moves to target that issue, instead of starting over.
- The wheel you’re looking at reinventing is a common wheel that many business people are faced with. Is your wheel unique to you, or is it something that many in your profession are faced with? If the latter, it is highly possible that there are many people also working to reinvent that wheel right now. Perhaps it is a standard business practice in your field that simply doesn’t work. Instead of putting forth resources (including time and money) to tackle it on your own, see if there is a group in your field working on this issue. If you are working to forge new paths at the same time others are trying to do the same thing, you’re all wasting resources and could likely work more effectively as a team.
Have you ever tried to reinvent the wheel? What happened?
How are you tracking your business success? You’re probably not, which is fine, but can make it extremely difficult to not only expect, but quantify, growth and success. You’d be surprised the number of businesspeople I talk to from all industries who say they want to grow their business, but when I ask by how much, they simply stare at me. Even worse are the stares I get when I ask what they have actively done to grow your business.
You cannot expect change and growth without actively working to strength your network and business. It simply won’t happen.
Most people can name specific things they do to improve their skill at a hobby they are passionate about, but so rarely is that passion carried over into their own business. Below is a list of quantifiable things you can do to strength your network, improve relationships with referral partners, and ultimately help foster the growth of your business.
How many can you check off? Let me know in the comments!
- Send a Thank You card – but make sure it is handwritten!
- Call to check in
- Arrange a 1-to-1
- Offer a referral to someone without them having to ask for one
- Include them in a regular newsletter for your company
- Send an article of interest to your contact
- Set up a group activity to bring together your networks
- Attend a networking event (and bring someone with you!)
- Display your partner’s brochure or flyer at your business
You should aim to do one to two of these things a week to consistently be developing your relationships with your network. And, of course, there are plenty of things you could do that aren’t on this list. What could you add?
The number of referrals you should expect to receive is dependent on the type of business you’re in and the effort you exert to develop your network. Some professions receive more referrals than others.
For example, a florist is going to get many more than a real estate agent. However, the florist will have to sell a lot of flowers to make up for one real estate sale. Hence, the type of profession can somewhat determine a range in the quantity of referrals.
Having said that, however, the actual number that someone in a specific profession can get varies dramatically depending on their efforts to develop those referrals. This variation depends on how they “work” their networks. You remember the old computer adage “garbage in, garbage out”? It means that if you put bad information into the system, you’re going to get bad information out of the system. Well, one’s networking efforts are very much the same.
The results you can expect to get out of your efforts will be based on the quality of people you put into it. I recently conducted an Internet survey of business professionals in which I asked, “What percentage of your business comes from word-of-mouth or referrals?” Even I was surprised by the results. More than two-thirds of the respondents said they received 70 percent or more of their business from word-of-mouth. Only 14 percent said that referrals accounted for less than 30 percent of their business, and only 2 percent said they got no business from word-of-mouth!
Clearly, word-of-mouth and referrals are critical to the success of many businesses today. The question is, how do you increase it? First, consider professions that are part of your contact sphere. These are businesses that have a symbiotic relationship to yours. Contact spheres are the building blocks of your referral business because they help to build a solid base of repetitive referrals for you. Read “Developing a Networking Contact Sphere” for a more thorough explanation.
Next, you should diversify your networks. That is, you should participate in different kinds of networking groups so that you may have a diverse cross section of businesses and professionals as part of your center of influence. It’s important for you to understand that you must first build the foundation I speak of above before you can have high expectations for developing referrals. Based on research that I conducted at the University of Southern California a number of years ago, I found that the average participant in a strong contact network or a business development network (groups that meet weekly and allow only one person per profession, and whose primary purpose is to pass business referrals) generated, on average, 4.2 referrals per member, per month, or roughly 50 referrals per person, per year.
See Chapter 8 of my book The World’s Best Known Marketing Secret for additional information about the payoffs of networking. Please note that there are many intervening variables to this number. In my study, these variables included such things as length of membership, the profession they represented, the years of experience, the level of participation and more. One thing that didn’t seem to make a difference was gender. Both men and women generated substantially similar numbers of referrals throughout their participation.
To summarize, the number of referrals you can expect will vary depending on your profession and your efforts in the networking process. However, on average, I’ve found that many businesspeople can generate more than 50 referrals per year via their participation in a single networking organization. What makes this number truly significant is that most people would agree that a referred contact is much easier to close into business than other types of contacts. I believe this is the reason that so many businesses say they generate most of their business through referrals and word-of-mouth.
I’m currently in Asia doing a number of speaking engagements and yesterday I had the pleasure of speaking at the BNI Japan National Conference. Today, I’d like to share with you an excerpt from the speech I gave where I explain the following five ways in which your network can promote you:
- Display your literature and products
- Make announcements for you about your business
- Endorse your products and services
- Provide you with referrals
- Introduce you to people / arrange meetings on your behalf
This is content straight from my book Business by Referral and if you’d like to learn about the additional ten ways your network can promote you (which I share in the book but not in this video), click here for an article I wrote specifically on this topic.
If you have any favorite tactics which you’ve personally found to be highly effective when it comes to putting your networking circle to work for you, please share them in the comment forum below. Thanks!
Do you know who really cares about your business and wants to help you? Realistically, there are only a few basic ways of motivating people to care about and help build your business. Basically, it comes down to relationships and rewards.
Some folks, usually friends or family, will simply want to help because they like you and want you to do well. These people will be motivated by the relationship itself.
But in most other cases, the long term motivation to build your business is not based primarily on whether or not the other person likes you. Business partnerships, including referral relationships, almost always include some form of mutual reward; typically in the form of social or financial gain. Both you and your networking partner have something to gain, and you are both eager to help each other achieve it.
Some people are motivated by the potential for business referrals you can send, while others are motivated by the prestige and opportunities created by having a relationship with you. Regardless of the underlying motivation behind them, relationships can take time to prove profitable in a substantial way, but that doesn’t mean they aren’t worth cultivating. Ultimately, strong relationships will steer back opportunities because of the nature of networking itself and of the endless variety of products and services to which it can lead.
I firmly believe that most relationships will probably prove rewarding in the long term, even in cases where you don’t receive referrals in return. There are a few super successful people to whom we send referrals who’ve never reciprocated with a referral back. We’re motivated to continue helping them in any way we can simply because they will work with people we refer to them. That makes us look good, because it’s very difficult for the average person to start a working relationship with these very successful, very busy people.
If we refer someone, it opens a door that might never have otherwise opened. The new person that we are referring to our very busy friends or associates is the one who now goes out of his way to reciprocate. That’s our motivation; helping our networking partners achieve their goals. And, of course, in one form or another, it winds up coming back in some way.
What are some experiences you’ve had in which you’ve benefitted in some way or another as a result of truly caring about others’ businesses and helping them to grow and achieve their goals? I’d love to hear your story/stories so please share your experiences in the comment forum below. Thanks!
How many businesses would you say you’ve supported over the years by being a loyal customer? Think about it, you could have been solely responsible for the new wing your veterinarian added to her office last year, just from all the money you’ve invested in your pet’s care over the last ten years. For some businesses, not only may you have been a customer–you may also have recommended them to other people. When was the last time those businesses returned the favor and helped your business succeed? There’s a strategy I like to call “following the money trail” which shows you how to leverage the law of reciprocity with the businesses you have financially supported.
Before you read on and get deep into this strategy, go find your checkbooks–both personal and business. I’ll wait . . . There, now that you have your checkbook(s) in front of you, it’s time to follow the money trail. Scan your checkbooks for local businesses that you have paid. You may notice regular expenditures, such as your hair stylist, veterinarian, physician, lawn care service, housecleaning service, dry cleaners, day care, pet resort, or grocery store.
First, let’s put this money trail into perspective. Start by analyzing just how much you have invested in these businesses. Get out a piece of paper and draw a table like the one shown below.
The law of reciprocity states that if I help you, you will, in time, help me in return. I would venture to guess that most of these establishments have never been approached by their customers with a request of reciprocity. What would you say to them? How would they react? Why bother? You might wonder: What could a hairstylist do for me–or for a financial planner–other than style hair?
Seeking reciprocity begins with your willingness to ask the question. Your request needs to be specific and needs to be supported by how much you have invested in their business over the last year or so. Are you willing to approach your favorite businesses and ask them to support your business in some way? If yes, let’s start with the example below and then consider what you could do for your business.
Example: Financial Planner Seeks Reciprocity from Hairstylist
First, the financial planner needs to take the hairstylist–let’s call her Joan–to lunch or coffee and engage her in conversation.
Financial planner: Thank you for joining me for lunch. I wanted to get some time with you away from the salon so I could talk with you about your business–and to ask for some help with my own business. I’ve enjoyed being your client for the last five years, and I’m glad I was able to refer four other people to your salon who have become clients. I wanted to ask if you might be willing to help support my business as well.
Joan: I have very much enjoyed you as a client, and I really do appreciate your referrals. What do you have in mind?
F.P.: As a client, I receive your quarterly newsletter. I see that you often have advertisements from community businesses. Would you give me space in your newsletter for an ad for one year?
J: Sure, but that would cost about $500 for the year.
F.P.: I was hoping that you would give me the space for no charge in return for my past referrals and for being such a loyal customer, even after moving twenty miles away.
J: I see your point. No one has ever asked me to do anything like this before. But it makes sense to me since you are actively supporting my business. The least I could do is give you ad space. Sure. I’d be happy to help you. Is there anything else you’d like me to do?
F.P.: As a matter of fact, there is. Could you leave one of my newsletters in your waiting area for your patrons to read while they wait?
J: Of course–that would be no problem.
In this example, Joan was willing and able to help the financial planner expand her visibility. Most people, once it’s pointed out to them, understand that the law of reciprocity goes both ways. If they seem reluctant to help you, it’s time to reconsider your loyalty. Should you continue to support someone else’s business when he or she flatly refuses to help your business in return?
As a client, you’re giving a lot to someone else’s business. It’s not unreasonable to ask for something that supports your business in return. Now think about your business and the businesses you support. What can you ask of them? Can you contribute to their newsletter? Will they display your pamphlet? Will they post your business announcements? Can you leave a stack of business cards on their coffee table? Will they pass out your business’ coupons to their customers at the register? Will they sponsor your next event?
Make it a point this week to approach at least one establishment for help with promoting your business. After all, when you follow the money you’ve spent on other people’s establishments, isn’t it about time some of it came back around to you? Also, I’d love to hear about your experiences with this so please come back and share your thoughts and experiences in the comment forum below. Thanks!
All of us are in business to make a profit. But if that’s the primary driving force in business, we become mercenaries to that process. I believe that I should serve a greater need than simply to make a profit. I believe that business can be honorable. It can make a difference in individual lives as well as communities.
Small business is the engine that drives many of the economies around the world. Small business doesn’t have the resources of large corporations. However, if they network together – the sum of the whole becomes greater than the individual parts. Well-designed collaboration based on an effective system and strategy can lead to small business success.
However, in the final analysis, the true foundation for success rests in an organization’s culture. In fact, I believe that culture eats strategy for breakfast. An organization needs a sound strategy to succeed but, it needs a great culture to excel. For me, that approach has been about creating core values around a culture of collaboration.
Core values establish culture. It’s never too late or too early to think about your core values in business and in life. Here are my core values:
- The Philosophy of Givers Gain®(What goes around comes around).
- Building Meaningful Relationships
- Lifelong Learning
- Traditions + Innovation
- Positive Attitude
I believe that it is possible to make a good living while serving a greater good. The core values I have tried to apply in my life and in my business have helped to create a culture of collaboration within the context of building a business. This approach is not only a great way to get business, I believe it is an even better way to do business.
Business can be honorable. It can be something that improves people’s lives as well as supports and helps local communities. It can do so, by not only helping to generate more business for one another, but by giving back to the community, mentoring others, immersing in a culture of shared learning, and by collaborating with others.
I have a big hairy audacious goal (a BHAG) for businesses around the world. I believe we can “Change the Way the World Does Business” and we can do that by incorporating core values into our business that support collaboration and positive meaningful relationships.
We are coming up on the 30th anniversary for my company (BNI) and I believe that our focus on these core values, philosophy, and vision are responsible for our 30 years of consecutive growth. Through strong economies and serious recessions – my organization has grown year in and year out for 30 years without exception. Few organizations can say that. I think that is a testament to our approach to doing business.
Have you given thought to your organization’s core values? If so, share your company’s core values here. I’d love to hear your comments.
I had a great conversation a while back with my business partner in the Referral Institute, Mike Macedonio (pictured to the right). He was explaining why he feels there are only a few criteria that must be met to make people referrable by him.
The first criterion is that the individual must be an expert at what he or she does. He looks for people who have invested in learning their trade and continue to invest to master their trade. Do they specialize in a certain area? What achievements have they attained in their area of expertise?
Another one of Mike’s requirements is that the person is passionate about what he or she does. This especially makes a lot of sense to me because if you’re not passionate about what you do, how can you expect other people to get excited about working on your behalf?
Mike’s last criterion stipulates that the person he is referring understands and honors the referral process. More specifically, Mike wants to ensure that the person receiving the referral understands his or her number-one responsibility. To quote Mike, “The number-one responsibility when you receive a referral is to make the person who gave you the referral look great.” As long as the people Mike gives referrals to are doing this for him, Mike can remain confident that his reputation will be protected. It also compels him to continue giving these people referrals.
Mike’s list of qualifications that make a person referrable is short, yet very powerful. After discussing it, we both agreed that we should expect others to evaluate our referrability by these same criteria. Are we invested experts, and do we continue to invest in our trade? Are we passionate about what we do? Are we practicing what we preach? Do we make our referral sources look great? I’m glad to say that I’m confident we both do all of these things.
So what makes people referrable by you? I’m sure many of you have some great ideas in response to this. I’d love to hear them, so please feel free to leave a comment.
The business I’m in involves a lot of coaching and guiding of franchisees to teach them how to coach and guide entrepreneurs, salespeople, and professionals to generate referrals for themselves and others. Sometimes this feels a little like ‘herding cats’; entrepreneurs hate being told what to do and it takes a real skill set to move them in a direction that involves a lot of hard work but will help them achieve the results they want.
One of the biggest challenges I have in this process is not with the actual entrepreneur or salesperson but with the individual I’m coaching to be able to guide the entrepreneur or salesperson. These people have gone through many hours of training, tend to have a fair amount of field experience, and have support manuals that exceed a thousand pages of documentation to assist in the process. They are true experts. I’ve discovered, however, that sometimes expertise can actually be a problem. Just because your expertise may arm you with the knowledge to recognize the solution to a problem or challenge, it doesn’t mean other people are going to automatically ‘believe’ you know the solution and/or want you to actually tell them the solution. I know that sounds counter intuitive; however, if you’ve ever raised a child, you know that this is often times absolutely true!
So, let’s say you’re an expert. You know you’re an expert. You know that you can help someone else. You also know that this “someone else” is a grownup who runs their own business or is an independent sales rep who chose their particular career for good reason . . . they like the freedom of being independent. How do you move these people in the right direction?
I had a person who worked for my company who once went into one of my locations and was appalled by how badly things were being run by the members of the group. She let them know in no uncertain terms what they were doing wrong and how they needed to turn it around. Her assessment of the situation and the solutions she proposed were spot on but her presentation of them was all wrong. She was so blunt with the group’s members that she received a very negative reaction from them and ended up leaving the place an even bigger mess than it was when she first walked in. When I met with her to talk about how she might have done things differently, she grew furious with me for not supporting her since she was right and the members of the group were wrong. I wasn’t arguing that she was right–she was. The problem I had was how she handled the situation–in that area, she was completely wrong. I tried to explain this to her by sharing one of my favorite sayings relating to the dilemma: “Don’t burn down the barn to roast the pig.” In other words, don’t make things worse than you found them when you were trying to fix them in the first place.
She could never really wrap her head around the concept that people may not welcome her advice with enthusiasm and agree with her stance on an issue when she was clearly right. She didn’t work for me for much longer (make of that what you will) and, eventually, we got an expert to work with that group who ‘listened’ to their issues, Built relationships with the group members, and then coached them into achieving the greatness they had within them. It’s important to note that this process took time and patience.
There are two things I try to teach people in this situation.
First, “people don’t care how much you know until they know how much you care.” If you want people to listen to you when you are coaching them or re-directing them, they have to know that you care about them and want them to succeed. If they don’t know this down to their core – they will not listen to your advice. Ever.
Second, is a saying given to me by mother on a paper weight when I was about 16 years old and I was running an uphill battle for a student council race. My mother gave me this paper weight (which is still on my desk in my home to this date). The paper weight says: “Diplomacy is the art of letting someone else have your way.” When she gave me that, she explained that I had to learn how to work “with” people – not “through” people. She said that even if I did know the answer to a problem – it did no good if no one else believed me. That advice helped me win the election and it has helped me many times throughout my life. I have to admit that I don’t always use it as well as I can – however, when I do use it, things almost always go more smoothly.
The bottom line is this: being right doesn’t help much if no one is willing to follow you.
What are your thoughts on this issue? Maybe you can share a story . . . but, remember to keep it positive. Let’s focus on positive outcomes more than just horror stories.
Last week I posted a blog on how to meet the right people and I focused on explaining how to meet people who serve the same professional client as you. Today, I’d like to continue this discussion but I’d like to focus specifically on how to meet people who can help you meet your business goals.
First off, if you haven’t set business goals then let’s stop right here–you need to make that your top priority this week! If you do have business goals, don’t let them collect dust on your bulletin board or get covered up in your drawer. Make it a point to review them each month. Choose a goal. The big question you need to ask yourself is “Who do I need to meet to help me accomplish this goal?”
It’s tough to make it alone in today’s competitive business environment. Even the biggest sports stars or governmental candidates can’t reach their goals alone–so why should we try to go it alone? Let’s say that one of your business goals this year is to write an article for a local paper. How would you network your way to achieving that goal? Well, first, you would start reading the paper. You’d find out who writes the articles, who writes for other papers in your area, who the editors are, etc. Then you would get the word out to your own network as there’s a fair chance it includes someone who could put you in contact with the right individual. You would let it be known that you wanted to meet writers, editors, and others working for local papers so you could gain insight and knowledge into how they accomplished something you were aspiring to do–you would also let it be known that you were in no way intending to try to sell to these people.
You would also look for networking events sponsored by these publications. You’d probably find staff members there providing support and you’d want to focus on meeting and speaking with the right people–professionals connected with the publication–again, with the intention of learning how to write an article for your local business paper. No matter what your goal is, writing and publishing an article or otherwise, if you network with the people who have the experience and connections to guide you toward your goal, you will be well on your way to accomplishing it.
Another example of this strategy is to think of the people involved in the six degrees of separation study. They had a goal to achieve . . . to get a package to a specific person whom they did not know. I would venture to suspect that the successful people in the study began by scouring their network for the right people who could help them accomplish this goal. Choosing anyone and everyone would have increased the links along the way . . . which was obviously the strategy of the 71% of the people who never connected at all.
In summary, remember: When you’re considering asking someone in your personal network for a favor, ask yourself whether she’s simply a contact or an actual established connection. Avoid the trap of having unrealistic expectations of your network, such as support that your contacts may feel you don’t deserve. You have to earn the loyalty and engagement of your referral sources. Your current goal has two parts: (1) to meet the right people, and (2) to develop deep relationships with them over time.
So, to help you pinpoint who you should be focusing on meeting the next time you’re at a networking event, make a list of the following:
- 5 professions (other than your own) that serve your preferred client market
- 2 business goals of yours
- 2 individuals you might seek out for help in accomplishing goal #1 and 2 individuals who might help you meet goal #2
How do you feel about the list you came up with? Do you find it helpful? Does it give you a clearer picture of where you want your business to go and who you should focus on meeting in order to steer your business in that direction? I’d love to get your feedback on this so please leave your thoughts in the comment forum below. Thanks!